A digital ‘audit’ can seem a daunting task but once broken down into stages the process becomes quickly achievable. This first planning step to take involves reviewing the digital health of your business and analysing your business’ current situation in terms of:• Your business’ ability to handle change• The online market place• Your online and offline market position• The external environment your are operating inThis is an opportunity to spot weaknesses in your business profile and marketing power online, so you can then build a marketing strategy based on your strengths as well as any opportunities to sell.Don’t worry about your research findings. This is a useful business exercise not a personal comment. Better to find ways of improving your marketing situation online than to ignore the need to improve. Try to make a point of taking a bird’s eye view of your business as online audits are very useful if you respond with logic rather than emotion.Remember, if you find holes in your business, you are not alone. Very common business audit discoveries include:• The business hasn’t planned well in the past• Not enough is known about a business’ customer groups (segments).• Pricing is inconsistent with competitors• Cash-flow is a worry and marketing budget isn’t enough to meet objectives.• Brand, website and customer loyalty needs building• Not enough is known about the potential of the internet as a tool for sales• Business team doesn’t have much IT technical knowledgeIt’s worth keeping in mind that if you are in a fast moving industry you will need to review your audit more often.Consider your internal environment (factors you can control)a. Decide what you want to get out of your audit, do you want:• More effective business procedures• Better return on investment (ROI)• Market insights to plan campaigns• Build customer relationshipsb. Consider the success of what information you already have (and how it translates online):• Internal written, digital or word of mouth data about customer service and productivity• Any marketing strategy• Business strategy• Product development, customer service and communications systems• What product / service distribution system and service network do you have currently? how would it have to change online?c. Consider your current assets to help you decide how you will reach digital objectives. These include cash flow, business competencies and internal and external resources such as your:• Management, employees, stakeholders, suppliers, partners, agency workers- their digital skills/ experience/ contacts/ goodwill and support• Current Customers – their digital preferences (what they use in terms of hardware, software, social media, advertising, downloads, webinars, podcasts, games)• Business budget (and partner business budget)• Materials and technology• Review all your marketing materials – what are they, how are they used? Are they cost-effective and what return on investment do you get?• Brand, (including its character, business culture and location)• Processes and systems, speed of operations and delivery to market• Previous business activity, competitor and market research/insight, financial history, campaign results.d. Define your current and target customers – by considering the things your regular customers have in common:Tip1: Create current and target market groupings (segments) based on their buying behaviour and demographics. It can help to define each group as a person. For example, a live music venue may target someone like ‘Johnny’ who is 32, single and likes a pint with his mates at a club where he hears new bands and then uses his iPhone to download the tracks off iTunes. He’s an impulse buyer who responds to what he sees/hears.Tip 2: Learn to use a search marketing tool such as Google Keywords SEOmoz, LongTail Pro or Market Samurai to find out what products, services, and information (relevant to your business) your target customers are they searching for online. There are plenty of tutorials available for each of these on YouTube or their respective websites.e. What are your business’ planned objectives and KPIs? Have any been achieved online or offline? Why did they succeed? Do you have customer feedback? Especially review what plans exist to recruit, convert and retain customers?Consider the marketing environment in which your business is located and your market position (on and offline)a. How does your business brand (personality) and your products/services fit into the wider marketplace and how will it be affected by it? You may want to use a free survey design service such as Survey Monkey to ask current customers and prospects for their views on your business credibility, reputation, products / services and future online growth. This process also helps to remind customers of your brand and intention to trade online.b. Consider your marketplace online and offline:• What does your industry look like online?• Who are your chief competitors? Are they the same offline? How would you describe their online brands, promotional techniques, customers? What’s unique and emotionally appealing about them to their customers? How can your brand be different and more appealing than theirs (without losing money?)d. What market share do you currently have (shows how competitive you are)? You can define this as Value (your market sales revenue divided by the total market sales revenue available) or Volume (your market unit sales volume divided by the total volume of units sold in that market). You can also look at your relative market share against a market leader (your market share volume divided by the market leader’s share volume). Be careful of planning price wars on this basis though as they harm the pricing structure of the industry down.e. What alternative partners and agencies exist in the online marketplace to help you with your supply chain, research, marketing, services, offers, weblinks, advertising etc?g. Asses your business’ digital ‘marketing mix’- this is a combination of marketing factors that collectively represent your business online. They include where you can find your business’ brand online, how you promote your business, your current online pricing mechanisms, your products or services offered online, your representatives and processes online and evidence of your existence (for example, if you offer services do you display testimonials, awards, guarantees, transparent customer service).h. analyse your brand’s market strength online:• How will potential customers come in contact with your brand and what it means to them (logos, products, website, promotions, social network interaction, downloads, employees, email responses, purchase systems, after sales added-value services etc)• How do you value those aspects of brand equity• Are you planning to expand your brand/products/services• Does your brand reinforce your business valuesConsider the external environment (factors beyond your control)a. Marketers use an analysis tool known as PESTEL (shortened to PEST) to consider the external environment within which a business operates and the factors which could impact upon that business’ goals.PESTEL is an acronym that represents the words Political, Economic, Social, Technological, Environmental and Legal. You can create your own PESTEL analysis by setting out these words and then bullet pointing with specifics that affect your business’ ability to achieve the aim of setting up and operating online.A bullet point example under the heading ‘legal’ might be:• UK Data Protection Act 1998This is important as you will need to comply with this law to protect customers’ data you hold as a result of trading online (and offline).You will probably be able to list at least 5 factors under each heading that are important influencers over your online success.PESTEL analyses are useful as they can help you identify potential threats to your business or opportunities if they are considered in light of your strengths and resources.b. Your online Strengths, Weaknesses, Opportunities and Threats can be expressed using an SWOT tool (you may well have carried out this exercise to create your offline marketing plan or business plan). A SWOT helps you take a bird’s eye view of your business, for you to consider how well you can compete, where your business is weak, where it could be threatened and then you can build a strategy for your digital plan.It’s worth taking the time to learn how to do this specifically for your business needs and to avoid the pitfalls. For further guidance on SWOT development see this American site Smes internet marketing.Audit summaryNow in light of your audit findings try to answer the following questions and see how they fit with any current marketing/business plan you have:1. Which of your KPIs and objectives have you achieved already and which ones can you achieve as a result of your audit?2. What does your SWOT/PESTEL analysis tell you about the potential for your business reaching and retaining target customers? What specific opportunities are there which are not inhibited by weaknesses?3. Who can you compete with and what are their weaknesses / strengths /plans? What specifically (within budget) will you offer customers that’s different from your competitors, offering greater value?4. Can you summarise your target markets’ buying behaviour?5. Are you clearer about what you need to produce and how you need to supply your goods/services online?6. Have you got the clues you need to provide good customer service online in a way your current and target customers appreciate?