Every manager should consider this 5C analysis before making marketing decisions.
As a good marketing manager, it would be a big mistake for the business to make decisions based on emotions and guesswork. An experienced manager knows that decisions should be made based on principles in every step of marketing and environmental analysis should be well reviewed. 5C is one of those marketing models that must be considered, especially for smaller businesses. But what is the meaning of 5C analysis? What does it mean and how should we implement this analysis for our business?
These questions will be answered in this article.
Table of Contents
What is 5C marketing analysis?
There are various analytical models, such as the SWOT matrix, to identify various environmental factors that affect an organization’s marketing decisions. But one of the most important analyses is the 5C marketing analysis model, with which you can conduct a complete environmental survey and somehow predict the appropriate response for your customers.
In other words, organizations use the 5C marketing model to identify and evaluate the potential challenges they may face in the future in various fields. In fact, by doing this analysis, you can find out in which areas your business performs well and in which areas it has performed poorly.
What is the 5C marketing model?
In the 5C marketing model, there are 5 areas of basic research, each of which is somehow related to your business model. These 5 areas include the following:
- Company
- Collaborators
- Customers
- Competitors
- Climate
We will explain each in detail below:
1- Company
In this part of the 5C analysis, an analysis of the company’s product line, organizational culture, goals, and brand image in the target market is done. Even factors such as the experience and technology used by the company are examined to determine whether the brand is in its best position and whether it can meet all the needs of customers. In the company sector, it is very important to be able to identify your competitive advantage and see if this competitive advantage is short-term or long-term based on the business model you have.
This part of the model examines three basic parts:
Fixed capital: These assets exist throughout the life of an organization, such as real estate and production equipment.
Variable capital: These assets are not fixed during the life of the organization, like the budget allocated to a department.
Innovative assets: These assets are types that are specific to the organization, such as the company’s various investments.
What questions should we ask ourselves in analyzing the company?
What is your product or product?
What is your main product?
Why should customers buy from you? (What is your competitive advantage?)
Which part of the company needs improvement?
In which sectors do you have effective investments?
Have you set long-term goals for your business? what are they
How much is your fixed and variable capital?
What are your annual expenses?
2- Collaborators
Any person or organization that somehow helps your business grow and is in your supply chain is considered your partner. For example, suppliers and distributors are considered your colleagues. Even organizations that invest in your business are considered your colleagues.
Here you should prepare a list of all your colleagues, including their contact numbers and emails. Then ask yourself the following questions.
What questions should we ask ourselves in analyzing colleagues?
Who is responsible for the company’s daily supply and executive operations?
Do you have a partner to help you turn the company around?
Are there investors or shareholders other than yourself?
What person or company do you get help from when sending products?
Have you outsourced? For example, how many freelancers or contractors work with you?
Do you have a financial advisor or lawyer for your company?
3- Customers
You may have heard the phrase “Identify customer needs” many times and it seems like a cliché. But the fact is that the most important principle in a business is to satisfy customers by satisfying their needs and desires. Start with market research, segment your market, and record customer repeat purchase intervals, purchase volume per customer, distribution channels, and customer needs at any point in time.
Be aware of the product you produce and don’t try to exceed your potential by making a promise to the customer that you can’t keep, most importantly, to compete in the market, you must have an incentive that will lead the customer to buy your product. Allows you to identify
What questions should we ask ourselves in customer analysis?
Who is your ideal customer?
Who is your target persona?
Which category of people are your customers now?
Which of your products do customers like the most and which do they ignore?
According to analytics statistics, which website pages are visited the most?
Do you have many loyal customers or a high churn rate?
What suggestions and criticism does the customer give you?
Why does the customer prefer you over competitors?
4- Competitors
Try to identify your closest competitors, who are they or what are their strengths and weaknesses? What is your strategy to take market share in front of them?
In this part, you should analyze the industry in which you operate identify your niche market, and offer a product or service that is special and unique, or at least covers a segment that competitors have ignored. For example, if you are a startup, check what makes you different from your competitors. If you haven’t written your business model yet, be sure to focus on this to be the most unique possible and make a big difference between yourself and your competitors.
What questions should we ask ourselves in competitor analysis?
How many competitors do you have in your industry and who are they?
Are your competitors newcomers or veterans?
Compared to competitors’ products, what is lacking in your product?
Research the competitor’s brand and identify its strengths and weaknesses.
Are your competitors active on social networks?
Do they provide specific content that is of interest to customers? Can you somehow produce similar content for your audience?
What is the way to attract customers in a competitor’s business?
What personas are your competitors targeting?
5- Climate (external environment)
If you are already familiar with the PEST matrix, that means you know the external environment analysis well. This part is quite similar to the PEST analysis, which analyzes the following 4 parts:
Political Analysis: Whether you like it or not, the fate of your business will somehow change with every policy adopted by different groups. So it is very important to examine different political movements and even predict them for the future and have different scenarios for each one.
Social analysis: Social analysis includes various things, such as the psychology of society, the type of relationships, the main lifestyles of people in society, culture and values, etc. It is very important to know the people in society who are going to be your target audience and to identify their values.
Economic analysis: All economic matters that somehow affect your business are reviewed in this section. Factors such as interest rate, economic growth, inflation, exchange rate, etc. It is very important to check the supply and demand. If the demand is not enough, your business will be at risk.
Technology analysis: In today’s world, businesses that do not adapt to the advancement of technology will be doomed to failure. Because the buyer’s behavior changes according to the advancement of technology you must be able to use the most up-to-date technology. In this section, you should analyze what kind of technology is used by the public, what technologies are coming, and how you can adapt yourself to it.
What questions should we ask ourselves in technology analysis?
Have economic factors changed? If it changes, how can it affect your business?
Do competitors use special technology? What is it and how can you implement it in your organization?
Is there a new law in the country or is it going to be? How does this law affect your organization?
Is there a special culture in your society or has it recently emerged? How can you best use it in your campaign messaging?
In the following, to make the topic more concrete, we have given an example of 5C analysis for a business:
Analysis of the 5Cs of the American sports club Planet Fitness
Planet Fitness is one of the largest sports club brands in America, which was founded in 1992 and has more than 2,000 branches across the United States, its mission is to provide a healthy and quality sports environment.
To better understand the 5C analysis, we want to give an example of this brand and briefly see how each C of this analysis is analyzed.
Company: Planet Fitness has several branches in most parts of America and is popular for its reasonable monthly price. This brand of sports club has designed a very friendly environment so that customers feel comfortable upon entering. Since the number of sports equipment in each club is large, the waiting time for each customer to use the equipment is short, which leaves a good experience for the customer. But on the other hand, there are also weaknesses. For example, sports devices are not so specialized and may not meet the needs of all customers, especially professionals.
Competitors: Planet Fitness has many competitors, but its most important competitors are Anytime Fitness and Gold’s Gym. Compared to these competitors, there is no swimming pool or sauna in the Planet Fitness complex, and this issue may lead customers to the competitors. But on the other hand, Planet Fitness has built its brand on the customer’s comfort and its motto is that no one is judged in its clubs and any ridicule from others is dealt with. This is the competitive advantage of this brand so that any person with any appearance can exercise without being judged for their appearance in Planet Fitness clubs.
Customers: On the Planet Fitness website, the customer is directly asked why he chose this sports club, which helps Planet Fitness to understand the customer’s needs and expectations from a good club.
Collaborators: As we said, collaborators of a collection are people or companies that help the growth of that collection. For a brand like Planet Fitness, colleagues are trainers who help the quality of exercise and customer motivation. Planet Fitness invites even more professional people who use its clubs to cooperate, and even in the expansion of its branches, it does not remain without cooperation with its customers.
Climate: The last C is related to the external environment, i.e. factors beyond the group’s control. In its pricing, Planet Fitness considers all economic factors such as the inflation rate, the cost of each household for sports activities, etc. It follows the tax laws and if a law changes, it will predict and calculate it in its prospects.