How to conduct a marketing audit
The marketing audit is a fundamental part of the marketing planning process. It is conducted not only at the beginning of the process, but also at a series of points during the implementation of the plan. The marketing audit considers both internal and external influences on marketing planning, as well as a review of the plan itself.
There are a number of tools and audits that can be used, for example SWOT analysis for the internal environment, as well as the external environment. Other examples include PEST and Five Forces Analyses, which focus solely on the external environment.
In many ways the marketing audit clarifies opportunities and threats, and allows the marketing manager to make alterations to the plan if necessary.
This lesson considers the basics of the marketing audit, and introduces a marketing audit checklist. The checklist is designed to answer the question, what is the current marketing situation? Lets consider the marketing audit under three key headings:
- The Internal Marketing Environment.
- The External Marketing Environment.
- A Review of Our Current Marketing Plan.
1.The Internal Marketing Environment.
What resources do we have at hand? (i.e. The FIVE 'M's):
- MEN (Labor/Labour).
- MONEY (Finances).
- MACHINERY (Equipment).
- MINUTES (Time).
- MATERIALS (Factors of Production).
- How is our marketing team organised?
- How efficient is our marketing team?
- How effective is our marketing team?
- How does our marketing team interface with other organisations and internal functions?
- How effective are we at Customer Relationship Management (CRM)?
- What is the state of our marketing planning process?
- Is our marketing planning information current and accurate?
- What is the current state of New Product Development? (Product)
- How profitable is our product portfolio? (Product)
- Are we pricing in the right way? (Price)
- How effective and efficient is distribution? (Place)
- Are we getting our marketing communications right? (Promotion)
- Do we have the right people facing our customers? (People)
- How effective are our customer facing processes? (Process)
- What is the state of our business's physical evidence? (Physical Evidence)
2. The External Marketing Environment.
As a market orientated organisation, we must start by asking - What is the nature of our 'customer?' Such as:
- Their needs and how we satisfy them.
- Their buyer decision process and consumer behaviour.
- Their perception of our brand, and loyalty to it.
- The nature of segmentation, targeting and positioning in our markets.
- What customers 'value' and how we provide that 'value?.'
What is the nature of competition in our target markets?
- Our competitors' level of profitability.
- Their number/concentration.
- The relative strengths and weaknesses of competition.
- The marketing plans and strategies of our competition.
What is the cultural nature of the environment(s)?
- Beliefs and religions.
- The standards and average levels of education.
- The evolving lifestyles of our target consumers.
- The nature of consumerism in our target markets.
What is the demography of our consumers? Such as average age, levels of population, gender make up, and so on. How does technology play a part?
- The level of adoption of mobile and Internet technologies.
- The way in which goods are manufactured.
- Information systems.
- Marketing communications uses of technology and media.
What is the economic condition of our markets?
- Levels of average disposable income.
- Taxation policy in the target market.
- Economic indicators such as inflation levels, interest rates, exchange rates and unemployment.
Is the political and legal landscape changing in any way?
- Laws, for example, copyright and patents.
- Levels of regulation such as quotas or tariffs.
- Labour/labor laws such as minimum wage legislation.
3. A Review of Our Current Marketing Plan
- What are our current objectives for marketing?
- What are our current marketing strategies?
- How do we apply the marketing mix? (Including factors covered above in (a))
- Is the marketing process being controlled effectively?
- Are we achieving our marketing budget?
- Are we realising our SMART objectives?
- Are our marketing team implementing the marketing plan effectively?
- Levels of staffing.
- Staff training and development.
- Experience and learning.
What is our market share? (total sales/trends/sales by product or customer or channel) Are we achieving financial targets? (profit and margins/ liquidity and cash flow/ debt: equity ratio/ using financial ratio analysis)