Situation Analysis

April 13, 2006

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The primary purpose for the situation analysis section of a marketing plan is to describe what is happening in the markets in which the company competes, and the company's product and distribution trends. A simple, common-sense approach to organizing and providing only relevant information is recommended for this section.

Subsections should go from the "big picture" of macroenvironment influences on your business down through total market descriptions, the competition, target buyers/end users, and, finally, product trends and your company distribution channels description.

Information in this section provides rationale and support for the marketing objectives, plans, and strategies. Key subsections include:

macroenvironment situation, which presents information on trends for demographic, economic, technological, political, social, cultural, material supply, etc., that impact on the company
market situation, which includes size, growth trends of total market, and key segments
competitive situation, which provides a description of major competitors with size, goals, market share, product quality comparisons, marketing strategies, marketing spending, etc.
target buyer or end user situation, which analyzes the identification and behavior of target buyers/end users and consumer wants and needs
product situation, which includes sales, prices, and contribution margins; net profits of each company product line are shown
distribution situation, which provides information on size, trends, and importance of each distribution channel for the company's products