What is a SWOT analysis? How to do it?

What is a swot analysis ?

A SWOT analysis or SWOT matrix is an internal analysis of your company. It is a marketing tool that is widely used when defining a strategy.

Particularly used for its simplicity, it is an excellent way of gathering all the information you need to design your strategy. In this article we will discuss what a SWOT analysis is, its advantages and limitations, how to carry it out and how to maximise its value. The SWOT is used in the initial development phase of your online shop.

SWOT analysis: definition, purpose and benefits…


The term SWOT is an acronym derived from the following four words :

  • Strengths
  • Weaknesses
  • Opportunities
  • Threats
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The SWOT allows you to highlight the strengths, weaknesses, opportunities and threats that your company faces.

A double analysis

The SWOT puts two analyses into perspective:

  • The internal analysis, strengths and weaknesses, which aims to list the elements internal to the company, such as the resources, processes and skills that enable your business to create value or, on the contrary, those that are missing from your business and that slow it down.
  • The external analysis aims to analyse your organisation within an environment and to understand what impacts this environment might have on your company. These impacts can be positive and create opportunities, or negative and create threats to your business.

The benefits of SWOT analysis

The SWOT analysis is very interesting for several reasons:

  • For comparative purposes: because it allows you to position your company in relation to your close competitors. It therefore allows you to assess what your competitors are offering in comparison with your activities. It is therefore in itself an analysis that is similar to a monitoring exercise.
  • Its dual level of analysis: Many strategic analyses only deal with an internal diagnosis or an external diagnosis. The SWOT is a condensed version of both, which means that thanks to a SWOT you have an overall view of your company and its positioning within its market, with the industry players, etc.
  • Its simplicity: it is much easier to carry out than other internal and external analyses.
  • Its strategic outlets: The SWOT aims to highlight strengths, weaknesses, opportunities and threats in order to choose an appropriate strategy that allows your company to build on existing elements and therefore be more efficient, less costly and faster. Through SWOT you can define your objectives and make recommendations.

However, you should be aware that SWOT analysis has some weaknesses. It does not highlight elements according to their levels of priority, it is more of a list, which can take into account elements that are very distant from your business as well as elements that are very close.

How to do a SWOT analysis?

Here is the methodology to follow to carry out a SWOT analysis:

A work of reflection

Carrying out a SWOT analysis means first of all accepting that your company is not perfect. Try to be as objective as possible, otherwise you will miss elements that could be detrimental to you in the future. It is therefore advisable to work with your teams and create a real general reflection. Take advantage of the fresh eyes that will bring in elements that you might not have thought of.

A two-stage analysis

Internal analysis 

The internal analysis invites you to reflect on the strengths and weaknesses of your company compared to your competitors. Not all elements are relevant to include in the internal analysis, as some elements may seem advantageous to you without being a strength, as your competitors also have this advantage. Strengths and weaknesses are therefore elements that only your business has. 

In this logic, the SWOT will highlight your strategic advantages and the delays you have on your competitors, which is much more useful than just listing everything that is “good” or “bad” in your E-Commerce.

How can you do this?

Your company has 3 main categories of assets, which you can analyse to see which are strengths and give you an advantage or which are deficiencies.

  • Skills and knowledge: employees, partners and collaborators in your organisation have skills, know-how, soft skills and knowledge that can give you a real strategic advantage. This knowledge enables your company to excel in innovation, research and development, management and generally in value creation
  • Assets: your inventory, your office location, your cash flow…
  • Intangible assets: your brand image, your customer portfolio, your databases, your distribution channels, your communication channels, your influence on social networks, partnerships.

For each of these three categories, ask yourself the question “Am I doing better or worse than my competitors? If you are doing better, that is a strength. If you are doing less well, that is a weakness. If you are in a similar situation, then don’t take this into account.

External diagnosis 

The external analysis of the SWOT aims to anticipate the elements outside your company that could impact you, positively or negatively. The objective of this part is to look at the potential opportunities for the development of your E-Commerce and to identify and monitor the evolution of threats that would be detrimental to you. Although it is counter-intuitive, unlike the internal diagnosis, consider all the elements that could affect you, whether or not they affect your competitors. You need to be sure that all the threats and opportunities stand out in your SWOT analysis. 

How can you do this?

One of the easiest ways is to use the PEST analysis: for each of the following categories, think about all the things that could affect you, both good and bad. Here is a summary table of the PEST analysis.

For all these categories, think of your organisation as part of an ecosystem: think also of your competitors, your customers, your suppliers, your employees, the market and trends.


Now that you have completed your internal and external analysis, you are ready to fill in your SWOT. Indeed, you now have your strengths and weaknesses from your internal diagnosis and your opportunities and threats from the PEST analysis. All that remains is for you to fill in the form.

Filling in the model :

The format commonly used is a table with 4 boxes for the 4 criteria already mentioned: strengths, weaknesses, opportunities and threats. If you wish, you can divide the boxes into sub-categories, if these allow you to show your strategic advantages or disadvantages more pertinently.

What can you learn from the SWOT analysis?

The purpose of the SWOT analysis is to give you an overview. Once you have analysed this, you have several strategic options at your disposal.

You need to assess the level of each of the four categories of strengths, weaknesses, opportunities and threats. Do you have many strengths and few threats? Do you have many weaknesses and few opportunities? As you might expect, the dominant category is going to be your priority: if it is positive, you should capitalise on it, if it is negative you should increase your efforts to counter it.

Photo credit : Abeena Lijo