Marketing Plan Guide

Most new businesses experience a pressing need to pay bills and meet expenses, which in turn generates pressure to make sales as quickly as possible. This highlights the importance of preparing in advance and understanding how your business is going to make sales. You have to figure out how it can be done profitably, in a way that helps to build up your share of the market. To do this effectively, you need to understand the basic principles of marketing, how to identify your customers and generate profitable sales. You also need to estimate the size of the market available for your business' products or services and how you 're going to capture that market ahead of your competitors. To put it in a nutshell, marketing is all about selling the right product, at the right price and in the right place, ensuring customers are happy with what they buy. Remember that the most effective form of advertising is word of mouth, so it is vital to look after your existing customers !

The Marketing Plan can help you to achieve the above and it should become a working document, being referred to frequently to monitor progress. It should also be regularly updated, to reflect changes in the business environment. A Marketing Plan is also useful to secure support from investors, like banks or government development agencies. The plan should cover what you want to achieve, by when and how you propose to achieve this. There are numerous variations of Marketing Plan structures, but the following outline is one suggestion you can follow:

THE MARKETING PLAN OUTLINE

A. EXECUTIVE SUMMARY

One to two pages in length, the executive summary should provide an 'at a glance' summary of the plan. It should instantly put the reader in touch with the key issues and strategies in the plan. Though it appears first, it should be written last, once you have completed all the other parts.

B. BUSINESS SUMMARY & OBJECTIVES

This section provides an account of the business performance to date. An existing business will provide key information like previous sales. and profits, and any major developments within the company. It is also important to provide evidence of management's ability and qualifications, which are relevant to running the business.

Also state what the business objectives are. This is as simple as writing down all.. of the ideas you have regarding what you would like to achieve and then tidying them up a bit! This is where SMART objectives come in useful.

SMART is an acronym for objectives that are:

Specific Measurable Achievable Realistic Time-framed

Let me explain! It would be very easy to say, for instance:

‘Ah yes, I would like to have more customers.’

But take this statement and make it a SMART objective.

‘I would like to increase the number of people I have as customers who live in Harris, by 5% within the next six months.’

The importance of this is that you know when you should have achieved this target and you have a deadline at which to revise it. Revise this objective in six months time and assess your company performance.

C. OVERVIEW OF THE MARKETPLACE

Your knowledge of the marketplace should be provided, in some detail. You could consider any Political, Economic, Social and, Technological issues (pEST analysis), and also include any environmental elements that may affect your company. Relevant facts and figures should be included, like the value of the markets the company operates in, particularly the ones that are or will be important to the company's development. Provide information on any major developments, like new products that have been introduced by competitors. Include details of any trends and hence, the opportunities that can be predicted for your company. (It is useful to highlight any market research you may have carried out).

D. PRODUCTS & SERVICES

An adequate description should be provided of your company's products and services. This should include the purpose they serve, what the features are, the benefits each gives to a buyer, and any unique selling points i.e. what makes them different from competitors' products/services. Remember that your product may be different on a number of things e.g. the product features, the price, the types of service available, the product's availability, the product's packaging, the image that the company projects, and so on.

E. COMPETITION

In order to strengthen your position, undertake what's known as a SWOT Analysis. This stands for Strengths, Weaknesses, Opportunities and Threats. It is good to do this to consider any developments within your company and also in the industry/environment, i.e. everything outside your front door! If you haven't done one before then here's what to do:

.STRENGTHS:

Write down all the Strengths of your company, for example, if your company offers a product that nobody else does in your area (considering choice or certain brand names for instance)

.WEAKNESSES:

Don't be afraid of this section! An apparent 'Weakness' can sometimes be turned in to a positive aspect. It may help you realise there's room to expand in to other areas, or will help you to identify areas in which you need to improve. Either way, it's good to recognise such points to try and make sure you see your business from the perspective of your (potential) customers. Examples could include, ineffective use of advertising so not reaching target market effectively and not being cost efficient-

.OPPORTUNITIES:

For this, you need to look 'outside' your company -absolutely anything that could hold potential for your business in the 'external environment'. For instance, new product released that nobody else sells and after weighing up the pros and cons, you believe would result in a significant increase in your sales/profit margins.

.THREATS:

This also applies to anything 'outside' your company. They may just be potential threats and not necessarily a current issue, but you should think as widely as you can to make your company as secure as possible just in case they do occur. For instance, change in market trends away from the products/service you offer. Although, competition can be seen as a healthy aspect of doing business, encouraging other companies to move with the trends, it is vital to be aware of what the competition is doing as their existence can also prove to be a threat to the success of your business. Therefore, Provide details of all your main competitors -their names, where they are based, what they offer, their key strengths and weaknesses, and their position in the marketplace. For example, if they are the market leader because they have the most customers, or perhaps they occupy a niche with the most expensive product in the marketplace.

Right! Now you have written down all your ideas on the Strengths and Weaknesses within your company and the Opportunities and Threats oufwith your company, you need to link up as many points under the four categories as you can, to make the whole project worthwhile! For instance, look at your strengths and see how you can use them to overcome any weaknesses, make the most of any opportunities, and help to eliminate or at least minimise, any threats. For instance, if one of the threats is a new competitor in the market, then you could try to minimise the risks to your company by looking at your strengths. One main strength which could help to combat against this, is building up good relationships with your customers, some of whom will become loyal and not even consider using another company.

F. TARGET MARKETS & CUSTOMER ANALYSIS

Clearly define the markets the company operates in. If you look at your customers, many will share common characteristics and can be 'grouped' accordingly. (Consumers -by age, sex, income, social status, lifestyle, etc. Business customers - by industry type, size, etc). Markets can also be broken down by sector. For example breakfast cereals and take away pizzas belong to different sectors in the food industry. Finally, you can also split your markets by geographical regions e.g. Western Isles, Scotland, rest of UK, export markets. In summary, this section should state who the key customers are, if not by name at least by type, and what their key characteristics are that make them relevant to purchasing your products/services. This in turn will help you to clarify the sectors you intend to target your products at. If you manage to gain details of specific customers, you should file this information on a company database, with the customer's consent, perhaps for future mail outs re special offers. This is a good way to monitor customer' buying habits and enables you to target people more specifically and directly when you know what products/services may interest them most.

G. MARKETING STRATEGY

A marketing strategy reflects a company's choices about how it intends to operate its business over a given period of time (usuallyone to three years), in response to the current and predicted set of business conditions and market circumstances. Two key variables in every business are :

a) The market -knowing what it wants and needs

b) The product -how it can be tailored to meet the particular needs of a chosen sector.

The marketing strategy is basically a company's proposals about:

• which products it will offer in what size and package
• to which market sectors
• at what price, or prices if there are differences in what each sector is prepared to pay
• with what means of promotion to inform and attract customers to buy your product
• the distribution methods you will use to supply customers

The strategy should describe clearly the company's policy on each of these aspects. This can be best illustrated by using an imaginary example. Consider a Highland based company which produces high quality, hand made chocolates which have a relatively short shelf life. High production costs require a premium price, which precludes it from competing with larger confectionery manufacturers. So, the marketing strategy may be:

• to produce two hand made, high quality loose products -'spirit flavoured truffles' and 'cream and praline'
• target customers/markets are up-market consumers with high discretionary Incomes
• retail price per kilo will be recommended and set at the same level as the market leader; a standard kilo price will be maintained for both large and small scale customers year round with no discounting
• distribution initially will be through exclusive specialist outlets throughout Scotland, with London planned in year two. Contract catering companies for corporate events in Scotland will be via mail order.
• branded point of sale materials, cellophane bags, and adverts in trade journals will be used to promote the product to the retailer/caterer, supported by a PR programme of reviews and adverts in food/homes/local press/publications to target the end consumer and emphasise the Highland imagery.

H. MARKETING ACTIVITIES

This includes the activities you propose to undertake to promote your product to the different target customers, to achieve your sales targets and company objectives. Whatever you wish to do should be written down as an action plan of your promotional tactics. It is best to set it out into monthly activities and to include a summary of the costs for each activity. For example, if you advertise in trade publications or the Internet, note down all necessary costs under each. You may instigate a direct mail campaign to tell potential customers of your mail order service. Or you may wish to issue a press release to coincide with your attendance at a major exhibition. Whatever the promotional activity, it should be included. It is also sensible to include other marketing costs, which are not promotion costs. This may be to carry out market research on the competition by visiting trade shows. You may have costs for providing agents/buyers with familiarisation visits, to brief them personally. Perhaps you want to contract the services of a marketing consultant to carry out a specific task.

The marketing budget needs to cover the total cost of the proposed promotional activities and other marketing activities. View this budget as an investment. Also, remember to evaluate the success levels of these activities as some will work better than others.

I. PROJECTED BENEFITS

Provide details of what the company expects to achieve by implementing the plan. Benefits could include ~ an increase in projected sales and profits; more prestigious customers; an increase in awareness of your company's presence in the marketplace (which will hopefully result in sales at a later stage); an increase in market share; an increase in your product range and/or a presence in new markets (therefore spreading the risk); lower production costs directly related to the upturn in sales; investment in new technology which improves competitiveness; the creation or safeguarding of jobs, etc.