SWOT, PEST and PESTLE - Do You Know The Difference? Definitions, Examples And A Free Template

SWOT, PEST and PESTLE - do you know the difference? If not, it could be the missing ingredient for your marketing campaigns.

When you are preparing a marketing plan, it is obviously very important that you take a detailed look at your current situation so that you can make the correct decisions in terms of deciding which marketing processes are viable and which are not.

To do this effectively, you need to take a detailed look at internal factors that you can control and external factors that you cannot (directly) control.


SWOT, PEST and PESTLE - Do You Know The Difference? Definitions, Examples And A Free Template


One of the ways in which you can do that is to carry out a SWOT and a PEST/PESTLE analysis. They are ideal because they help you to analyse both internal and external factors that could impact the success of your marketing campaigns.

Here's a quick look at what these terms actually mean:

SWOT - Strengths, Weaknesses, Opportunities, Threats

PEST - Political, Economic, Social, Technological
PESTLE - Political, Economic, Social, Technological, Legal, Environmental


It's a very good idea to conduct this analysis right at the beginning of your marketing strategy. This is for the following reasons:

-   It's really helpful to have a clear idea of your current situation before you decide on your next steps
-   This type of analysis might help uncover important areas to focus on that you might otherwise miss or neglect to think about

Here is a more detailed look at both the SWOT and PEST framework so you can have a clear understanding of it before putting together your own analysis.

I'll mostly be explaining the terms below in a marketing context, although you'll be able to see how you can apply the framework to any other area too. 

SWOT Analysis - Strengths, Weaknesses, Opportunities, Threats
Internal factors that you have some direct control over

Strengths

These are the strongest aspects of your current situation. For example, you could include the following types of information in this section:

-   Ranked on the first page of Google for key search terms
-   Well known local brand that customers trust
-   Most customers come from word of mouth referrals

Weaknesses

These are the weakest parts of your current situation. For example, you could include the following types of information in this section:

-   Lack of customer database segmentation
-   Social media activity is irregular and ineffective at best
-   Weak internal sales and marketing skills 

Opportunities

These are areas that offer some potential if attended to properly. For example, you could include the following types of information in this section:

-   An extensive customer database that can be segmented and developed
-   A new product currently in development will be the first to market
-   Marketing budget can be increased by 20% if required for the next 12 months

Threats

These are the areas that could impact you negatively if not attended to properly. For example, you could include the following types of information in this section:

-   Search rankings can slip if new guidelines aren't understood and adhered to
-   Unhappy customers can spread their feelings through social media if they're not taken care of properly
-   If new product is delayed, a competitor can get to market first

PEST Analysis - Political, Economic, Social, Technological
External factors that you have no direct control over

Political

In this section, you would think about political issues that might affect your marketing plans. It might be that the Government or your local authority are making a big push in an area that affects your business, such as trying to make people more active or trying to make national businesses more attractive to do businesses with than off-shore rivals.


The key here is just to consider if there are any large movements such as this that can affect your own niche and marketing plans. For a small business, this section doesn't normally need a lot of focus - just have a think to make sure you're not missing anything really important. 

Economic


These are elements of a wider financial nature that are outside of your control but might affect your business and marketing. For example:


-   What effect is the current interest rate having on your customers disposable income? 
-   Does the current economic situation mean that businesses are more or less likely to use your particular service?

Social

These are socially based elements that are out of your direct control but that might affect your business and marketing plans. Areas to think about here are 'people' based, such as :


-   Demographics - which members of the population are experiencing the worst financial crunch? Does this impact your target market?
-  General trends - for example, if you are in the travel business and more people are holidaying at home rather than going abroad, how does this affect you?

Technological

These are tech-based elements that are outside of your direct control, but that might affect your business and marketing plans. For example, you might want to consider the following:

-   More people are using smart-phones to surf the web - how does this affect your website design and lead generation plans?
-   Social sharing through sites like Facebook and Twitter has increased exponentially - should you then plan to create highly shareable content?


A note on PEST: depending on your business, you might find that some areas are more important than others, so don't worry if any of the sections seems completely irrelevant to you.

Beyond PEST - The PESTLE Analysis

The PESTLE Analysis would be the same as the PEST example above, only with the two additions below included:

Legal

This header would include legal issues that could impact your marketing campaigns. For example, you could think about looking at the following:

-   Any laws specific to your industry that dictate what you can and can't say in your promotional materials (think health warnings, wrongful advertising etc)

Environmental

This section would highlight environmental factors related to your plans. For example, you could consider the following:


-   Carbon footprint - is there an issue here with marketing and sending your products overseas?
-   Are your marketing partners/affiliates trading ethically and responsibly in their area/region? 


These would probably be considered in your broader business plan, although I included them here for fullness.

Example SWOT Analysis

Here is an example SWOT analysis from a mock charity campaign:


Strengths


23% of all charitable donations are made to children’s charities


11% of all charitable donations are made to disabled charities


Charity ABC is an established and trusted charity


Advocacy from competitive wheelchair athletes


Potential cyclists should be encouraged by the extensive collection of good news stories on the site and motivated to help
Weaknesses


The website lacks a user friendly design


Potential cyclists cannot register online through the website - this may deter prospects


Low staff numbers likely point to a shortage of specialist marketing employees


Medical charities receive the largest portion of donations and sponsorships from the public

Opportunities


The charity biking market is not saturated


Low barrier to entry to reach target audience


New technology and digital marketing platforms facilitate reaching new subscribers


Popular races are already established - there is no need to invent


Existing runners database can be used to attract cyclist sponsors - either the runners themselves or from their network
Threats


Competing charities gaining wider exposure and advocacy


Falling SEO performance


Larger charities receive a large share of charitable giving - - already, 54% of charitable giving is received by only 0.5% of UK charities


Charitable giving has fallen by 20% (£1.7bn) the past year - this could impact funds received from runners via sponsorship

Example PEST Analysis

Here is an example PEST Analysis from the same mock campaign:


Political
Economic
Social
Technological
There is a significant move on behalf of the Government to get people active (METS)


The Big Society Audit has acknowledged that many charities are now struggling due to lack of funding


Back Britains Charities Campaign founded by CAF and NVCO
Disposable income is at a 3 year low


Donations to charities fell by 20% in 2012


The proportion of people giving to charity last year fell from 58% to 55%



The number of individuals engaging in athletic sports has increased since Olympics 2012


23% of charitable donations were made to childrens charities
There is a growing shift toward mobile for media consumption


Most people check email on mobile devices


Most people prefer to be contacted by brands via email


New technology facilitates ease of giving

Blank SWOT/PESTLE Analysis Template

Here is a blank SWOT/PESTLE Analysis layout sheet for you to see how it should all be laid out and for you to practice on using the above information as a guide.



If this isn't displaying correctly, you can get to the original here: Blank SWOT/PESTLE Analysis Template

In Sum

Hopefully this has helped you get to grips with the SWOT and PEST/PESTLE analysis and has shown you that they are nothing to be frightened of.

In short, they are just ways of looking at the entire (current) picture so that you can make the best decisions going forward. Once you have completed this type of analysis, you'll be in a much better position to carry on with designing the rest of your marketing strategy.

Finally, I've said this a few times before, but it's important that you understand the distinction between the two frameworks:


- SWOT is used for internal factors that you can control
- PEST/PESTLE is used for external factors that you cannot control


Using both means you have everything under consideration and the chances of you being taken by surprise and suffering a set back to your marketing campaigns are greatly reduced. 

Thanks for reading,

By Alan MacDougall

Got a nagging marketing question? Ask me here.
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Revenue Builder is a small business marketing strategy advice blog, written to help small business owners and startups maximise sales revenue.