01/10/2023
Reading Time: 11 minutes

Tourism SWOT Analysis: Step-by-Step Guide with Examples

 

In the world of tourism, crafting a strategic marketing plan is crucial for the success of your venture. One indispensable tool for such planning is the SWOT analysis.

What is a SWOT Analysis?

A SWOT analysis is a strategic planning tool that helps tourism businesses identify and evaluate their internal strengths and weaknesses, as well as external opportunities and threats. It provides a structured framework for assessing various aspects of a business and its environment, which can inform strategic decision-making.

Understanding the Structure of a SWOT Analysis

Before we delve into the details, it’s essential to grasp the framework of a SWOT analysis, which is divided into four distinct areas:

Internal Factors

Strengths (S): These are internal attributes and characteristics of your business that give you an advantage over others. Strengths are factors that you control and can leverage for your business’s benefit.
Weaknesses (W): These, too, are internal aspects, but they represent limitations or shortcomings within your organisation. Weaknesses are factors within your control, and you can work to address them to improve your business’s performance.

External Factors

Opportunities (O): Opportunities are external factors outside your organisation but can be favourable for your business. These factors are beyond your control, but you can adapt your strategies to exploit them.
Threats (T): Threats are also external factors that pose potential risks or challenges to your business. These factors are often beyond your immediate control. Still, you can develop strategies to mitigate their impact or prepare for them.
Table of Internal and External SWOT analysis issues

Why is a SWOT Analysis Important for a Tourism Business?

A SWOT analysis is particularly crucial for tourism businesses due to the industry’s dynamic nature.

  • Strategic Planning: Tourism businesses need to adapt to ever-changing market conditions. A SWOT analysis offers a structured approach to identifying areas that need attention and resources.
  • Competitive Advantage: Tourism businesses can leverage their unique attributes to gain a competitive edge by understanding their strengths and weaknesses. This can be critical in a crowded marketplace.
  • Risk Mitigation: Recognising potential threats in advance allows tourism businesses to proactively address them, reducing the likelihood of being caught off guard by external factors.
  • Opportunity Maximisation: Identifying opportunities ensures that tourism businesses can exploit emerging trends and market shifts, potentially increasing revenue and market share.

Identify Internal Influences – Strengths and Weaknesses

Strengths (S):

Strengths are internal attributes that are intrinsic to your business, and you have control over them. They represent the positive aspects of your organisation that provide you with an advantage. When considering strengths for your tourism business, think about attributes such as:

  • Unique Selling Points: What sets your tourism business apart? It could be your location, the experiences you offer, or your exceptional customer service.
  • Quality of Service: Assess the level of service you provide. Do you have a strong reputation for delivering exceptional experiences to your guests?
  • Loyal Customer Base: Consider the number of repeat customers. A strong base of loyal guests is a significant strength.
  • Resource Availability: What resources do you have, both tangible and intangible, that contribute to your success?
  • Expertise and Skills: Evaluate the skills and expertise of your team, which can be a vital strength.

Weaknesses (W):

Weaknesses are internal aspects that can hinder your business’s success. These factors represent limitations or areas that need improvement within your organisation. As you identify weaknesses in your tourism business, think about elements such as:

  • Budget Constraints: If your tourism business operates with a limited marketing or operational budget, it can affect your reach and competitiveness.
  • Seasonal Demand: Assess whether your business faces significant fluctuations in demand due to seasonality.
  • Infrastructure Limitations: Consider any limitations or maintenance issues related to your physical facilities.
  • Staffing Challenges: Are there any issues related to staffing, such as understaffing during peak seasons?
  • Outdated Technology: Outdated technology, including your website or reservation systems, can be a weakness in today’s digital age.

SWOT ANALYSIS

Identify External Influences – Opportunities and Threats

Opportunities (O):

Opportunities are external factors beyond your tourism business control but can be favourable for your business. These factors exist outside your business and can create opportunities for growth and success. When identifying opportunities, consider aspects such as:

  • Market Trends: Identify emerging trends in the tourism industry, such as eco-tourism or experiential travel.
  • Collaboration: Look for opportunities to collaborate with local businesses, attractions, regional, state and national tourism industry bodies or online travel agencies (OTAs).
  • Digital Marketing: Explore the potential of leveraging digital marketing and online booking platforms.
  • Government Incentives: Investigate any government grants or incentives related to tourism.
  • Diversification: Can you diversify your product or services, such as adding adventure packages or event hosting, to tap into new customer segments?
  • Local Events and Festivals: Capitalise on local events and festivals to boost bookings during peak seasons.

Threats (T):

Threats are external factors that can pose potential risks or challenges to your business. These factors, like opportunities, are beyond your immediate control but can impact your business negatively. When identifying threats to your tourism business, think about elements such as:

  • Competition: Recognise the competitive landscape in your area or niche. New businesses and established competitors can affect your market share.
  • Economic Downturns: Economic fluctuations can impact discretionary spending on travel and tourism, affecting your business.
  • Weather-Dependent Tourism: Poor weather can be a significant threat if your business relies on favourable weather conditions.
  • Regulatory Changes: Be aware of potential changes in local or national regulations that might affect your business, such as zoning laws or safety standards.
  • Online Reputation: Negative online reviews, social media backlash, or customer complaints can harm your business’s reputation and deter potential guests.
  • Natural Disasters: Unpredictable natural disasters, such as storms, earthquakes, or wildfires, can disrupt travel plans and affect tourism in your area.
  • Environmental Factors: Increasing awareness of environmental sustainability and concerns about the ecological impact of tourism.
  • Global Pandemics: The outbreak of global pandemics, like the COVID-19 pandemic, can lead to travel restrictions, reduced tourism demand, and concerns about health and safety.

An Example of Tourism SWOT Analysis

Now that you understand a SWOT Analysis, here is an example based on an accommodation provider – a historic bed and breakfast accommodation in the Yorke Peninsula.

Internal Factors – Strengths and Weaknesses

Strengths:
  • Prime Location: The bed and breakfast is on the Yorke Peninsula, known for its natural beauty and outdoor activities.
  • Charming Aesthetic: The property features a charming, vintage aesthetic that appeals to guests seeking a unique experience.
  • Excellent Customer Service: The bed and breakfast has a track record of providing exceptional customer service and personalised experiences.
  • Loyal Customer Base: The business has a loyal customer base that often returns for repeat visits.
  • Well-Maintained Facilities: The property is well-maintained and offers modern amenities in a rustic setting.
  • Unique Ambiance: The bed and breakfast offers a unique, cozy ambience that sets it apart from chain hotels.
  • Excellent Guest Reviews: Past guests consistently leave positive reviews praising the accommodation, hospitality, and overall experience.
  • Dedicated Staff: The small family team is committed to delivering personalised service and ensuring guest satisfaction.
  • Well-Defined Brand Identity: The bed and breakfast has a well-defined brand identity that resonates with its target audience.
Weaknesses:
  • Limited Marketing Budget: The business struggles with marketing due to a limited budget, which affects its visibility and reach.
  • Seasonal Demand: The Yorke Peninsula experiences significant seasonal fluctuations in tourism, which involves the business’s year-round revenue.
  • Limited Capacity: The bed and breakfast has a limited number of rooms, which can lead to turning away potential customers during peak seasons.
  • Staffing Challenges: The small staff needs help managing peak occupancy, leading to occasional service delays.
  • Aging Infrastructure: The property’s infrastructure, while charming, requires ongoing maintenance and can be costly to update.
  • Limited Marketing Budget: The business struggles with marketing due to a limited budget, affecting its visibility and reach.
  • Limited Marketing Expertise: The team lacks in-depth marketing expertise, hindering the development of effective marketing strategies.
  • Seasonal Demand: The business experiences significant seasonal booking fluctuations, challenging consistent marketing.
  • Outdated Website: The website, a critical marketing tool, is outdated and not optimised for mobile devices.
  • Inconsistent Social Media Presence: The establishment’s social media accounts are sporadically updated, leading to missed engagement opportunities.

 External Factors – Opportunities and Threats

Opportunities:
  • Eco-Tourism Trend: Increasing interest in eco-tourism aligns with the natural beauty of the Yorke Peninsula, presenting an opportunity for niche marketing.
  • Collaborations with Local Businesses: Partnering with local tour operators, restaurants, and complementary businesses can enhance the guest experience and create mutually beneficial relationships.
  • Online Booking Platforms: Leveraging online booking platforms can expand the bed and breakfast’s reach to a broader audience.
  • Government Grants and Incentives: Government incentives for historic, unique or eco-friendly accommodations can provide financial support for property upgrades.
  • Diversification: Expanding the business to include experience packages such as private tastings, property tours, or spa services can attract a broader clientele.
Threats:
  • Competition: An increasing number of accommodation options on the Yorke Peninsula means fiercer competition.
  • Economic Downturn: Economic downturns can impact discretionary spending on travel and tourism.
  • Weather-Dependent Tourism: Poor weather conditions can deter tourists from visiting the region, affecting revenue.
  • Regulatory Changes: Changes in government regulations, such as zoning laws or safety standards, could require costly modifications to the property.
  • Online Reputation: Negative online reviews or social media backlash can harm the business’s reputation and deter potential guests.
  • Economic Downturn: Economic downturns can affect discretionary spending on travel and tourism.
  • Online Reputation Management: Negative online reviews or social media backlash can harm the establishment’s reputation and deter potential guests.
  • Natural Disasters: Unpredictable natural disasters, such as bushfires, floods, or extreme weather events, can disrupt travel plans and impact tourism in the area. Preparing contingency plans for such events is essential to ensure guest safety and business continuity.
  • Environmental Factors: Growing concerns about ecological sustainability may lead to changing preferences and demand for eco-friendly accommodations. To address this, consider implementing eco-friendly practices and promoting your establishment as an environmentally responsible choice.
  • Global Pandemic: The outbreak of global pandemics, like the COVID-19 pandemic, can lead to travel restrictions, reduced tourism demand, and concerns about health and safety. Developing and implementing health and safety protocols, as well as flexible booking policies, is crucial to address the challenges posed by global pandemics and ensure the safety and confidence of guests.

Next steps…

Marketing Strategy Based on the Example SWOT Analysis

Now that we have a comprehensive SWOT analysis for the small bed and breakfast on the Yorke Peninsula, it’s time to craft strategies based on the insights gained:

Based on the SWOT analysis, we can formulate strategies to strengthen the marketing plan of the small bed and breakfast:
The strategies developed through the SWOT analysis provide a roadmap for the small bed and breakfast to leverage its strengths, mitigate weaknesses, seize opportunities, and defend against threats. It’s essential to continually assess and adjust these strategies as the marketing landscape evolves.

Strengths-Driven Marketing Strategies:

  • Leverage Unique Ambiance: Emphasise the cozy and vintage ambience of the property in marketing materials. Highlight how it offers a distinctive experience compared to chain hotels, appealing to guests seeking something unique and charming.
  • Customer Testimonials: Utilise excellent guest reviews by showcasing them prominently on the website and in marketing materials.
  • Refine Brand Identity: Build on your well-defined brand identity to ensure it resonates with the target audience. Consider refreshing your branding to reflect the vintage aesthetic and unique ambience.
  • Repeat Guest Incentives: Implement a loyalty program that offers discounts, special packages, or exclusive access to returning guests.
  • Partnerships with Local Businesses: Collaborate with tour operators, restaurants, and complementary businesses to create exclusive guest packages. Cross-promotion can attract more visitors and enhance the overall experience.

Weaknesses-Addressing Marketing Strategies:

  • Marketing on a Limited Budget: Focus on cost-effective marketing strategies, such as social media marketing, content marketing, and email marketing. You can also explore low-cost or free local advertising options and leverage your loyal customer base to spread the word.
  • Staffing Challenges: Consider hiring temporary cleaning staff during peak seasons to help manage the increased turnover demand. Provide additional training to ensure the service quality remains high even during busy periods.
  • Infrastructure Maintenance: Prioritise necessary maintenance and updates for aging infrastructure. Highlight any renovations or improvements in marketing materials to show that the guest experience is continuously enhanced.
  • Website and Social Media: Invest in updating the website to make it mobile-friendly, easy to navigate and search optimised. Establish a consistent social media posting schedule to engage with potential guests regularly and promote unique offerings.

Opportunities-Exploiting Marketing Strategies:

  • Eco-Tourism Marketing: Highlight the eco-friendly aspects of the location and property. Embrace sustainable practices and promote as an environmentally responsible choice to attract eco-tourists. Do not greenwash, though.
  • Online Booking Platforms: Regularly update and optimise presence on online booking platforms, ensuring that listing is appealing, well-maintained, and contains high-quality images and accurate information.
  • Government Grants and Incentives: Research and apply for government incentives that support historic or eco-friendly accommodations. This can provide financial support for property upgrades and sustainability initiatives.
  • Diversification: Expand offerings to include experience packages, such as private tastings, property tours, or spa services, to attract a broader clientele and differentiate your B&B from competitors.

FURTHR READING: Tourism Greenwashing: How to Avoid it and Control Your Marketing Message

Threats-Mitigation Marketing Strategies:

  • Competition: Monitor competitors and adjust marketing strategies accordingly. Differentiate offerings and continuously seek ways to stay ahead in the competitive landscape.
  • Economic Downturn: Diversify marketing efforts to target budget-conscious travellers, offering special deals and packages during economic downturns to maintain bookings.
  • Regulatory Changes: Stay informed about regulatory changes and proactively adapt the property to meet new standards, ensuring compliance while avoiding costly last-minute modifications.
  • Online Reputation Management: Actively manage online reputation by responding to positive and negative reviews promptly and professionally. Showcase commitment to guest satisfaction.
  • Natural Disasters: Develop and communicate contingency plans to address the impact of natural disasters on travel plans. Ensure the safety and comfort of guests during such events.
  • Global Pandemic Preparedness: Develop health and safety protocols and flexible booking policies to address the challenges posed by global pandemics.The strategies developed through the SWOT analysis provide a roadmap for the bed and breakfast to capitalise on its strengths, mitigate weaknesses, seize opportunities, and defend against threats. It’s essential to continually assess and adjust these strategies as the business environment evolves.

Wrapping it Up

A SWOT analysis is not a one-time exercise. It should be revisited regularly to adapt to changing circumstances and ensure your marketing efforts remain competitive and aligned with your business goals. Whether you’re just starting your marketing plan or looking to revamp an existing one, the SWOT analysis is a foundational step in the strategic planning process that can make a significant difference in your tourism business success.

Tania Shirgwin

Tania Shirgwin

Founder + Head Consultant

Tania is a marketing strategist specialising in tourism, wine and hospitality marketing. As founder of Decant Digital (formerly bizeez communications), Tania’s unique role over the past 14 years has enabled her to follow her passions of travel and her marketing obsessions of strategic marketing planning, consumer-focused web development, search optimisation, and training. With over 80 customised websites built to date, successful event marketing campaigns and new business branding, Tania’s wealth of experience ensures businesses continually increase website traffic, direct bookings, and sales via proven marketing tactics.

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