What is TOWS Analysis?  

 The TOWS Analysis or TOWS Matrix is a variant of the SWOT Analysis model, which investigates and analyzes Strengths, Weaknesses, Opportunities, and Threats that a business has to confront.

 The primary aim of the TOWS Matrix is to help a decision-maker for improving strategic options from an internal-external analysis. It is an immensely functional and practicable method, especially, in the field of marketing.

Advantages of The Tows Analysis 

Making the analysis is not only brainstorming a lot of optional strategic ideas. It’s also about connecting internal factors to external ones for generating the most proper blueprints for the organization.

Furthermore, it allows you to convert analysis from SWOT into strategy formulations and helps you get a more comprehensive perception of the strategic decision that you make. 

Explanation:

SWOT analyses brand and market in a 2-by-2 matrix:

• Brand -> Strengths and Weaknesses
• Market -> Opportunities and Threats

TOWS formulates strategic alternatives by multiplying dimensions of SWOT:

• Strengths x Opportunities (Maxi-Maxi Strategies): How can brand X get maximum from the opportunity by focusing on its strengths?
• Strengths x Threats (Maxi-Mini Strategies): How can the brand minimize the impact of threats by utilizing its strengths at the maximum level?
• Weaknesses x Opportunities (Mini-Maxi Strategies): How can a brand minimize its weaknesses by taking advantage of opportunities at the maximum level?
• Weaknesses x Threats (Mini-Mini Strategies): How can the brand impact of its weaknesses and avoid threats?

Outcomes:

•  Generating strategic options.
• A better understanding of how to take advantage of the opportunities open to you.
• Minimizing the possible effects of weaknesses.
• Protecting against threads.
• A better understanding of the external environment.
• Generating ideas to use the external environment for strategic advantage.

How to Apply TOWS Analysis

Before creating alternative strategies with TOWS, the first SWOT analysis needs to be done. Here are two critical points while preparing SWOT properly:

• Strengths and weaknesses stem from the brand. Since the brand is “perception in minds of customers”, strengths and weaknesses should be identified based on the perceptions of the customers, not product properties. One of the most frequent mistakes while determining strengths and weaknesses is to exaggerate the importance of tiny product aspects that are negligible for customers based on the brand manager’s own beliefs.
• Opportunities and threats stemming from the external environment, i.e., market. Opportunity is any external factor that, when taken advantage of, can impact the business positively. On the contrary, the threat is any external factor, when cannot be avoided, can impact business negatively. 

After determining strengths and weaknesses, opportunities and threats properly, a 3-by-3 matrix is prepared as shown in the figure.

Briefly;

TOWS enrich the thinking process by transforming cliche SWOT into an effective strategy formulation tool.

TOWS Analysis was conceptualized in 1982 by Heinz Weirich.

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