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What is a Marketing Environment Audit?
Kotler and Keller (2007) defined marketing audit as the “…comprehensive, systematic, analysis, evaluation, and the interpretation of the business marketing environment, both internal and external, its goals, objectives, strategies, principles to ascertain the areas of problem and opportunities and to recommend a plan of action to enhance the firm’s marketing performance.”
Marketing audit is usually conducted by a third person outside of the organization and isn’t connected in any way with the founders or promoters of the organization.
While carrying out a Marketing Audit, there are certain points that should be kept in mind and adhered to. They are as follows −
The Audit should cover all the areas of marketing and not just where there is a problem exists.
A systematic approach should be adopted for analyzing the company’s both micro and macro environments (the SWOT analysis), marketing principles, objectives, strategies, and other activities that directly and or indirectly influence the marketing performance.
The most objective way to carry out a marketing audit is to employ a third party who will show no bias and will not have the pressure of historic influences. When selecting someone to carry out the audit, a company or a business will need to allow them to completely submerge themselves in the company culture and activity to get a full picture of the company.
While a third party is being asked to actually put together the findings of the audit, the business owners should also be prepared to invest some of their own management time to the process to get the best results.
Periodical − The marketing audit should not be a standalone event. While a full audit, which is a part of a company’s strategic marketing plan, need only be carried out once or every alternate year, it would be prudent to audit the marketing activities more regularly to make sure a business is still on track to meet its objectives.
Components of Marketing Audit
Marketing Strategy Audi
A major part of the audit checks the feasibility of the business mission, marketing objectives, goals and marketing strategies that have a direct impact on the firm’s marketing performance. It doesn’t matter how efficient the marketing activity is in achieving the objectives if the objectives are wrong for the company’s future.
This includes all the factors outside the firm that influence the marketing performance and covers the ‘Opportunities’ and ‘Threats’ part of your SWOT. These factors are Demographic, Economic, Environmental, Political, and Cultural.
Micro Environmental Audit
Micro environmental audit covers the internal factors, the ‘Strengths & Weaknesses’ of the SWOT.
Role of Marketing Audit to Meet Company Goals
A comprehensive review of a company’s marketing and communication really helps a business understand where it is heading from a marketing perspective. By reviewing issues such as customers and the target audience; business competitors; the marketplace in general and the internal situation, an organization will be more informed about the success of previous marketing activities.
A marketing audit analyses the business objectives and understands what the business is trying to achieve by providing leaders with the opportunity to make more informed decisions on their future marketing direction. This information also helps small- to medium-sized businesses build a successful marketing strategy and highlights what they will need to deliver the most cost-effective marketing strategy in order to meet their business objectives.
A marketing audit is often used by a company reviewing its business strategy. A marketing audit can inform management with an invaluable customer and market insight, vital to help them set realistic business objectives.
Key elements that may be covered in a marketing audit should include the following −
Customer and prospect research
Competitor landscape analysis
Review of current internal marketing activities assessing their impact and results in the past
Overview of external market factors covering the PESTLE analysis
Conducting SWOT Analysis
It is critical for any business to look at the strengths and weaknesses of the business from a customer's point of view. The key is to understand what the strengths are that are also important to customers, rather than what a business is just "good at".
Another important area is to understand the weaknesses and where the performance affects customer relationships and market opportunities. The opportunities and threats available need to be considered to understand how you can maximize the opportunities and minimize the threats. The opportunities and threats to any business come from the external factors affecting them and this will be touched on throughout the PESTLE (Political, Economic, Sociological, Technological, Legal and Environmental) analysis.
Market Research to Understand Customers’ Prospects
As part of conducting a marketing audit, companies should do a research on their customers and prospects to understand why they buy from their organization and perhaps why they do not buy. It helps develop and improve the products and services further. It also helps in the customer experience and branding campaigns that position the organization to prospective buyers.
Competitor Landscape Analysis
A key part of the marketing audit is also undertaking competitor analysis. This could include some so called ‘mystery shopping’ that helps a company compare itself against its competitors in areas related to service, analysis of your online activity, website, Google ranking.
Reviewing Internal Marketing Environment
Some companies really miss the point and skip this step altogether, even though It is probably the most important of all. It is time to put your own business and its marketing environment under the microscope. More importantly look at all the aspects of your business from a marketing perspective including the following key elements −
What resources does the company have for marketing & sales?
What type of marketing material, brochures and flyers is used to promote your company to prospects? How is it used? How often?
What promotional vehicles are utilized which include website, collaterals, direct marketing, interactive and online marketing?
What is the state of the technological and analytical vehicles used for marketing purposes, including database, market research and CRM systems? How could they be used more efficiently and in an integrated manner?
How effective is the website like and how is it being used?
What social media channels is the business using and how’s the engagement with the followers across the various platforms?
What do the customers and prospects think of the company? How do they engage with the organization and at what level?
What about the overall customer experience that is provided? What is the customer experience at various touch points?
External factors are equally as important when undertaking a comprehensive marketing audit. It is important to recognize that although a business may have no control over external factors, they are still hugely influential and therefore very important to consider when setting your business and marketing objectives. One of the best approaches used by businesses for analyzing the external environment is the PESTLE analysis – it is useful for identifying the economic factors that affect the decisions of the business. It is about taking the political, environmental, social, technological, environmental, and legal factors all into consideration and identifying how they are impacting your overall marketing strategy and objective setting.
The marketing audit is really a 'back to basics' marketing approach that many businesses do away with only to find they suffer the consequences later down the track.
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