Extensive SWOT Analysis of Goldman Sachs + Infographic | IIDE (2024)

In our last blog, we had done an outright SWOT analysis of one of the largest private-sector banks, HDFC. In this blog, we will be discussing the SWOT Analysis of Goldman Sachs.

Goldman Sachs is one of the largest banks in the world in terms of total assets. It was also the 2nd largest bank in the world by revenue generated from investment banking in 2020. It is the leading financial advisor to mergers and acquisitions all over the world with deals worth $152.8 billion. It was able to gain such large deals with the help of its strong digital marketing presence which gave them a wider reach. So if you are interested in learning the latest skills in digital marketing – check out our Free MasterClass on Digital Marketing 101 by the CEO and Founder of IIDE, Karan Shah.

This makes us keen to know how Goldman Sachs is able to gain such a large presence in all parts of the world, here we have done a comprehensive study on the SWOT Analysis of Goldman Sachs.

But before we look into its SWOT analysis let us first know about Goldman Sachs as a company, its services, competitors, financials, and more.

About Goldman Sachs

Goldman Sachs Group Inc is an American multinational investment bank that was founded in 1869 by Marcus Goldman, and Samuel Sachs. The company is headquartered in New York and has its offices in most of the world’s major financial centers with over 40,000 employees under it.

They advise businesses in decision-making and managing risks. They help local, state, and national governments in funding their projects such as investing in the infrastructure of schools, hospitals, roads, etc. Along with this, they also deal with various transactions and investments for their clients as well as their own business. They do this to ensure that both their client’s business as well as the economy grow and generate jobs. Additionally, Goldman also provides managerial services to grow assets for various institutions as well as individuals.

Goldman Sachs’s mission is to promote sustainable economic growth and financial opportunity around the world. With more than 150 years of experience working with the world’s leading companies, entrepreneurs, and institutions, Goldman mobilizes their people and resources to drive its customer’s success, increase individual prosperity and accelerate economic progress for all.

Goldman Sachs had a market capitalization of US$90.73 billion as of 2020 and had generated net revenue of US$44.6 billion in the same year. It has total assets of around $1.2 trillion as of 2020.

Services of Goldman Sachs

Goldman Sachs is dealing with a wide range of services in the market for different customers. Some of the services that they provide are as follows:

• Asset Management
• Consumer Financing
• Global Investment Research
• Investment Banking
• Private Wealth Management
• Global Investment Research

Close Competitors of Goldman Sachs

Goldman Sachs is one of the biggest financial institutions in the world, therefore it has many competitors in the market. Some of Goldman Sachs competitors are:

• Goldman Sachs
• HSBC
• Citi
• Bank of America
• Trust Financial
• United Bank

Now that we know the company let us start with the sequence-wise SWOT Analysis of Goldman Sachs.

SWOT ANALYSIS OF GOLDMAN SACHS

SWOT analysis is nothing but a detailed analysis of a business in terms of its internal factors Strengths, Weaknesses, and external factors Opportunities, and Threats. The importance of a SWOT analysis is to help a business understand where they stand, what they need to work on, and how to reach the next level of success.

Let us now understand its SWOT analysis by first starting with the Strengths of Goldman Sachs.

Strengths of Goldman Sachs

Strengths are the positive factors that help the business grow. Goldman Sachs has many strengths some of which are listed below:

• Wide range of services – It provides a wide range of investment banking, securities, investment management, and consumer banking financial services to a broad and diversified customer base including corporations, financial institutions, governments, and individuals.
• Strong geographical presence – It is quite interesting to note that the company has several branches all around the world in over 60 cities. Most of them are located at prime locations. This helps them create a strong visual presence in their audience’s mind. Having several branches all around the world really does have a few major advantages.
• High investments into Research and Development – In this dynamic world that we live in, it is more than necessary to pay keen attention to research and development. Market trends and consumer trends are changing by the second therefore it is crucial for a company to stay updated at all times. This is exactly the reason why Goldman Sachs is among the top players in its field. The company agrees with the importance of R&D and invests hefty funds into the same. Market trends and consumer trends are changing by the second therefore it is crucial for a company to stay updated at all times.
• Remarkable Performance in New Markets – As the company has accumulated excellent expertise over the years, it is much easier for them to enter new markets without any hassle as they are backed with ground-breaking experience and knowledge. Professionals from different countries do bring different skill sets, this is a major advantage that Goldman Sachs has over its competitors. Encouraging contributions from various employees located in different countries will help the overall performance of the organization.
• Great Digital Marketing Presence – 90% of Goldman Sachs’ marketing is performed online. The benefits of having a strong digital marketing presence are endless. Although the company is not yet present on Instagram or Pinterest, they have engaged with their target customers on other social media channels like Twitter, LinkedIn, Google +, and YouTube. They use both organic as well as paid strategies in their digital marketing campaigns.

Weaknesses of Goldman Sachs

These are the factors that slow down the growth of the business which need to be tackled as soon as possible. Following are some of the weaknesses of Goldman Sachs:

• High Employee Turnover Rate – Goldman Sachs has a higher turnover rate compared to its competitors, which means more employees are leaving their jobs and, as a result, more money is spent on training and development when employees leave and join. A high employee turnover rate discourages new employees from joining an organization as they think that the organization may not be as good as they claim and in turn affect the organization’s brand image. Such an issue must be resolved diligently and as fast as possible. With the help of Human Resource Management specialists, this problem can be handed over to professionals. However, this will be an expensive procedure but if such an issue is not handled at the earliest then the repercussions may be a difficult task to handle.

• Legal Problems – Lack of legal experience and legal staff are not highly qualified. If not handled properly, lawsuits can get quite expensive and cost the company a lot hence increasing their expenses. Lawsuits that go on for a really long time tend to be quite expensive and may give rise to negative press for Goldman Sachs.

Opportunities for Goldman Sachs

Opportunities are the factors that arrive anytime in the life of a business. The company has to be able to grab these opportunities and grow its business. Following are some of the opportunities that Goldman Sachs has:

• Can start focusing on the crypto-currency market – With new market trends come new investment options. Crypto-currency is one such form of investment that has caught the public eye. As many people are interested in investing in this new form of digital assets but have little to no knowledge in how to do so, focusing on this will not only help the company attract more customers but also help in diversifying its product portfolio and compete in the market.
• Can generate more online sales by using large data analysis – The world is digital now, the companies that do know how to leverage this are now amongst the top companies in the world. Starting business operations online will not only help Goldman attract more customers locally but also internationally. The biggest benefit of going online is access to big data! This data helps a company understand where their customers are, what they are looking for, and how much they are willing to spend on it. Having access to such data will surely give the company an edge over its competitors.

Threats to Goldman Sachs

Threats are the factors that come along with success. The more the company is successful the more threats it gets. A company needs to know how to tackle these threats and see that it doesn’t become a problem. Following are some threats for Goldman Sachs:

• Large competitors- It faces large competition from different companies from all around the world some of which are JP Morgan Chase & co., Morgan Stanley, Lazard, The Blackstone Group, etc.
• Irregular supply of innovative products- Over the years the company has developed numerous products, but these are often a reaction to the development of other players. Moreover, new product deliveries are not regular, resulting in high and low fluctuations in sales over time. Innovation is key and without innovation, no company can stay competitive for a really long time.
• Exposed to fluctuating exchange rates- As the company operates in many countries, it is exposed to currency fluctuations, especially given the volatile political climate in various markets around the world. Sometimes these fluctuations may be in their favor and sometimes they may not. However, decisions must be taken while keeping such fluctuations in mind as these may lead to hefty losses in the future.

With this, we have completed the SWOT Analysis of Goldman Sachs. These types of studies help the company know where they stand in the market and know what to improve.

Conclusion

After going through this detailed SWOT Analysis of Goldman Sachs, we know that it is one of the largest banks in the world in terms of total assets. It has shown a remarkable performance in different markets with the use of the latest digital tactics. It can evolve its business by simultaneously using large data analysis to grow its sales. Although it has a large presence in the market still has some drawbacks.

High employee turnover rates and fluctuating exchange rates can bring losses to the company this can be tackled through enhanced digital marketing skills which will lead to an increase in sales and brand reputation. Although Goldman Sachs does have a decent digital marketing presence, they should devote more resources to the department for a better result. If you are interested in learning more and upskilling, check out IIDE’s 3 Month Advanced Online Digital Marketing Course to know more.

If you would like to read such detailed analyses of companies, find more such insightful case studies on our IIDE Knowledge portal.

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