What does a marketing plan cost these days?
Hundreds, thousands? Not that much if you know what to do your self!
Have you asked a Marketing Agency for a quote todraw up a Marketing Plan recently? If you own a small business, then it is hard to justify spending the 600 a day one asked for. We all have to watch our bottom lines like hawks, especially in the difficult-trading-conditions we seem to be in. But here is a dilemma! A Marketing Plan is a really essential tool that will show a small business owner where their business is and map out where it needs to go. It is vital in today's competitive environment that even small business should have one.
When you overdraft comes up for renewal and your bank manager has to justify lending the bank's money to your business, think how much easier it would be to convince them with a plan laid out in neat systematic form.
It is the case that far too many small companies don't have a Marketing Plan, or the owner has it locked up in his head. A place of storage that is really difficult to access when you need to show it to the potential investor or the bank manager. Inevitably this event usually occurs when you are really busy and committing your plan to paper, or computer file, is added pressure that you really could do with out. I run a small retail business and recently I studied for, and obtained, the UK's Chartered Institute of Marketing's "Professional Diploma in Marketing". It was a convergent learning course on the net and in four intensive workshop days in my local town. It brought home to me that what we did in our own business was fine up to a point. As the course was very practical, with the chance to use any organisation of the student's choice in the assignments that we had to submit, I ended up formally setting down the Marketing Plan on paper, that had been up there in my head for no one to see!
So what is a Marketing Plan for?
Well, its purpose is to lay down, direct and co-ordinate all your marketing activities and events. It is like a map. With a map it is easier to get some place. With a marketing plan it is easier to get the business to where you want it to head. This is, hopefully, to huge profits!
Perhaps you are the owner or director of a company seeking backing or further investment? Well a good marketing plan can be really important in attracting new investment or better bank facilities.
Perhaps you need help in making choices regarding which parts of the market to focus on and how to compete in that target market (Marketing Strategy)?
Often the mere process of preparing a marketing plan will help you to develop a successful marketing strategy through the discipline and process that you go through.
A good marketing plan will describe all the marketing actions to be carried out within a specific time period. It will contain details of your company, its products or services, its marketing objectives and strategies and information on how to measure the results of the marketing activities.
It might help if I give you a framework of basic elements that a Marketing Plan should include.
Basic Elements of a Marketing Plan
So what do you need?
1.Executive Summary - introduces and explains the major features and recommendations to executives (or your bank manager).
1.1 Introduction - a brief description of your organisation, its products and or services.
The context and objectives of the plan should be described and a description of what your business activities are. You should include current revenues, customers and your market position. You can also blow your own trumpet here! Note your accomplishments and successes to date.
If it is a new market entry or entirely new markets you are going for, then here is the place to describe any experience, training or competencies that your company has.
1.2 Vision, Mission Statement and Objectives
Mission statements focus on the long-range purpose of your marketing plan.
"To educate entertain and enlighten our clients so that they become more successful Marketers."
Company objectives should be more specific and oriented towards action.
"We will deliver a balanced range of Marketing Solution Publications to the U.K. and Europe through mail order and Internet."
1.3 Team description
Who will deliver the plan? What are the resources and structure of the team who will do so?
Management skills and capabilities. List any Marketing knowledge, sales skills, copy-writing ability, etc.
Agencies - Include any Marketing consultants, PR agencies you are using.
If there are any gaps honestly point them out and do a Training Needs Analysis.
1.4 Main marketing objectives
You need only give a brief statement of these here to close the Executive summary.
2.1 Current market conditions
What are the trends in your market?
What are the dynamics facing businesses such as yours?
Who are your target customers?
What competition do you face?
2.2 Market trends:
You should describe the macroeconomic trends that directly affect the target market that your marketing plan is aimed at.
This is where the PEST Framework is useful to include. (Sometimes referred to as PESTEL, SLEPT or PESTE) the components are:
Political
Economic
Social
Technological
Environment
Legal
2.3 Target market
It goes without saying that you should be aiming all your marketing efforts precisely at a target market or you are heading for a disaster.
All good marketing planning should follow from a very detailed segmentation of the market.
Size? Is it growing, staying the same, or shrinking?
Customer characteristics e.g. age, sex, income level, location, marital status, number of children etc.
Habits, patterns and values of target customer.
What are their wants, needs and desires?
What are their buying habits? - How do they spend their disposable income and when do they buy and how do they buy? How many times and when?
2.4 Competition analysis
In the micro environment analysis of a Marketing Audit you will hopefully have identified your present and potential competitors. What are their key products / services? How do they differentiate them selves? You should briefly explain the actions that you will take to oppose or overcome your competitor's offerings.
I highly recommend you use Professor Michael Porter's Five Forces Model for this and the four other threats he identifies. Space does not allow me to go into detail here although I have written a more comprehensive report in which I include a diagram of the Five Forces Model available from my own website:
http://www.promarketer.co.uk2.5 Issues analysis
You should briefly list such key external issues as government legislation affecting your business, or new technological development that impinges on your product.
3.1 SWOT analysis
Strengths
Weakness
Opportunities
Threats
A major component of any marketing plan is the SWOT analysis. Strengths and weaknesses are born of internal elements while opportunities and threats come from outside.
When opportunities and threats are recognised they can then be examined from the point of view of your product strengths and weaknesses.
What could we change or improve about our product to make it easier for the customer?
What are our customers' wants and desires? - We may possibly find new opportunities by thinking about such questions.
It is worth remembering that a threat can also be an opportunity to you, while a strength may also be a weakness depending on your point of view!
A business offering a vast selection of products may see this as one of their strengths. But for the customer, confused by the bewildering array of options as they try to find what they need, sees it as a weakness.
4. Positioning Strategy
Decide how you want your clients to perceive you in your marketplace.
Lowest price?
Best service?
Highest quality?
This is all part of the differentiation process.
5. Differentiation
You want to 'stand out from the crowd' so you need to make some decisions on segmentation and the positioning of your business. Combine this with your competitive analysis and you should be able to differentiate yourself from the competition.
6. Key messages
Thinking about differentiation should also help you to decide on your 'Key messages'. Be warned that it usually takes time for these to make an impact, to 'sink in', as it were. This means it is important to keep repeating your consistent messages throughout any marketing campaigns.
7. The Marketing Mix
The 4 P's.P is for:
Product - List your companies products and services. Include their key features. Is there something unique about them? If you are launching a new product or service include it here.
Price - There are many ways to set a price, some more scientific than others are! Remember that pricing is an integral part of the marketing strategy. Ask yourself is the customer willing to pay the price proposed and will it give you any profit? Some prices may be set on a cost-plus basis - adding a profit on to the costs of producing the goods or services. A better way is the 'market-based' price because it takes into account what your competitors are charging.
Place - where do you sell? Direct, through an intermediary? Bricks and mortar or virtual outlet?
Promotion - what activities are you going to use to create awareness of your product or service to generate sales? This is also referred to as Marketing Communications and includes direct selling, corporate events, brochures, web-sites, advertising. You should be warned that many inexperienced marketers think that the promotional plan is the entire marketing plan. It is, as you can see, but one component of the marketing plan.
7a. Integration of Promotional activity
Have you got a consistent look and feel to all your marketing mix? It is wise to make sure all your communications, brand positioning, propositions, messages, etc are derived from a single brand position so it is not confusing to the consumer by being fragmented. Also are there cross selling opportunities for you to exploit?
Only 4 Ps? - Funny, I thought I heard there were 7!
Before leaving the marketing mix I need to tell you about the Extended mix, which adds People, Process and Physical evidence to Product, Price, Place and Promotion.
If you are a service, or a not-for-profit organisation, then the extra three Ps are most important for you. But don't just assume that because you are not, that they don't apply!
People oriented organisations have to consider how their personnel make the marketing activities more, or less, effective when dealing face to face (or on the phone) with their public.
Process makes it easy for you to deal with the organisation. If it is a charity, for example, today people expect to be able to go on-line, set up direct-debits, pay by card and not just put money in the street collectors tin.
Physical evidence is expected to result from paying for a service or donating to a charity. You expect to see some physical evidence of the use your money has been put to.
8. Marketing Budget
You need a detailed budget for the next year showing the budgeted costs for each of your promotional items.
9. Measurement
Results and feed back must be gathered each month and compared with the marketing plan. When they are going astray you need to take corrective action.
Another tip is to ask your customers how they found you so that you can monitor what parts of your communications plan are working. Note this and include this in your measurements.
10. Milestones
It is a good idea to announce in the plan some marketing milestones you will strive to achieve. When you pass them celebrate!
So there it is a step by step process to create yourself a professional Marketing plan.
The author is Nicholas Thorne who runs an independent bookshop and a gift business on the Internet.
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