What Is A Marketing Plan?
You may already be familiar with marketing plans, but for those who are not, we will first cover the question of; ‘what is a marketing plan?’ A marketing plan is a key component of any forward thinking, successful organization and should form part of an overall business plan. Marketing plans can be utilized by businesses of all sizes, from small SME’s right through to large multinational corporations. The plan will provide a detailed analysis of the organizations market position, which will include an overview of the market in which it is operating. The plan will design a strategy, which will help the organization achieve its goals and desired market position. These types of plans can be produced for a number of reasons. The organization concerned may want to increase their market share. They may also be introducing a new product, or may be entering a new market. Marketing plans can also be set up to address under performance, particularly if the marketing strategy outlined in the previous plan has failed to work.
What Is Included In A Marketing Plan?
The specific format of a marketing plan will vary from business to business. Plans created for larger organizations are likely to have more steps, as there are likely to be more considerations; this is due to the size of the organization and number of employees involved in the implementation. Generally speaking though, most if not all plans will contain the following steps.
• The Purpose of the Plan and Mission Statement.
• Strategic Planning (SWOT Analysis).
• The Objectives of the Marketing Strategy.
• Marketing Strategy Plan.
• Cost Analysis, Planning and Implementation
Each of the above steps is vital for the success of any marketing plan. But what do they mean?
The Purpose of the Plan and Mission Statement.
This meaning of this section may seem apparent; however it is important for all businesses to have clearly defined goals and a specific sense of purpose. At this stage of the plan the business should create a very succinct statement as to why the plan has been created. They should explain how the plan will be implemented and may include desired results. A mission statement, which is an expansion of the purpose, should also be created, if not in place already. Revisions to existing mission statements for businesses that are changing direction can also be made. The mission statement should provide a clear statement which personifies the long term goals and values of the organization. A good mission statement will explain the mantra of the business, how they intend to operate and why they were created. It will allow internal and external customers and stakeholders understand the vision of the organization and its intended method of operation.
Strategic Planning (SWOT Analysis)
A SWOT analysis is a vital part of any successful marketing plan and will allow an organization to understand its position in the market place. SWOT is an acronym of; Strengths, Weaknesses, Opportunities and Threats. This simple format will allow a business to conduct a full assessment of its market position, providing an excellent overview of it capabilities. The SWOT Analysis will assess the strengths; what does the organization do well and what are its capabilities? It will also look at any weaknesses; what is the organization not doing well? What restrictions are in place, which may be due to the size of workforce, assets, location or economic climate?
The Opportunities aspect of the plan will assess the potential for growth and profitability. The Threat section will look at potential pit falls, which may include economic conditions or may assess competitors who have moved into the market place. A good SWOT analysis will highlight any internal issues; which are the strengths and weaknesses. It will also flag any potential external issues, which may be positive or negative, when the opportunities and threats are analysed. The business will then have a clear understanding of the issues which will aid improved performance and or expansion, (strengths and opportunities).
The business will also have an important understanding of any potential hurdles which they will need to overcome (threats and weaknesses). All of this information will facilitate strategic planning and will allow the planners to understand the true potential of the business in its current state and trading conditions.
The Objectives of the Marketing Strategy.
This aspect of the plan may also seem straight forward but it is a crucial aspect of the overall plan. The strategy will be devised which will include both financial and marketing objectives. Tangible objectives will be set, which will later provide the measures of which the success of the plan can be compared against. The strategy will provide accountability to the plan and should be specific and time bound in its wording.
The Marketing Strategy. This is a follow on from the previous section. The marketing strategy will provide a detailed plan as to how the marketing objectives will be achieved. The marketing strategy will assess the marketing mix and will generally contain the ‘Four P’s’ – namely;
Product, Price, Place and Promotion.
The ‘Four P’s’ can be applied to any marketing plan and cover the essentials of any product launch or on-going promotion. Briefly the ‘Four P’s’ cover;
Product.
Are the products goods (tangible) or services (intangible). If the business is dealing in tangible goods, will they be mass produced with a specific volume in mind? Packaging, storage and delivery of the tangible goods will also need to be taken into account. Intangible goods or services, include sales and customer service operations and also encompass trades such as the hospitality industry. Again there may be the cost of tangible goods to take into account, which are delivered as part of the service.~
Price.
The price is the amount paid by the end user for the goods or service. The pricing strategy should take into considerations such as; margin, overheads, tax implications and the cost of any raw materials. The pricing strategy may be fluid, to include promotional deals and discounts.
Place.
This is also referred to as the distribution channel. Essentially the place is where the product of service will be brought to market. Historically this would have been a physical location, generally in the form of a shop. These days the telephone and increasingly the internet are more profitable channels of distribution, with some companies no longer having a physical presence to sell their goods. The delivery of services can be flexible in terms of location, dependant on the business. The importance though, of the internet and phone regarding services is perhaps even greater than that of physical products.
Promotion.
Promotion is a broad term which encompasses how the product will be marketed to its target audience. Typically there are two types of promotion. These are known as ‘above the line promotion’ and ‘below the line promotion’. Above the line promotion includes advertising in traditional mediums such as; television, radios, written print ie newspapers as well as more modern forums such as the internet and mobile telephones.
Generally the company looking to market a product will pay an advertising agency to create a bespoke advert, to be featured on one or more of the mentioned mediums. Below the line promotion is perhaps a more subtle method of advertising, but is none the less effective. Very often the target consumer is unaware that the promotion is taking place, but may well take in the advertising message on a subconscious level. Below the line promotion can include; product placement, sponsorship deals, in store merchandising, public relations and mail shots. Most successful promotion campaigns will include both above the line promotion as well as below the line promotion. Promotion campaigns tend to fail when an organisation concentrates entirely on one specific area. Successful promotion campaigns should have a number of clear aims. The first is to present the information regarding the product or service to target consumers and other potential customers. The second aim will be to increase the demand for the product and service. The third critical aim is to provide a reason to buy; the promotion campaign should highlight a Unique Selling Point (USP), so that they can differentiate themselves from their competitors. Typical USP’s centre around cost, quality and ease of use.
Cost Analysis, Planning and Implementation.
The final part of the plan will analyse the businesses ability to deliver the marketing plan. This area will concentrate on the financial aspects of delivery of the strategy. The costs relating to promotion in particular can escalate out of control if left unchecked. Opportunity cost is important here, as it will assess the expected financial return based on the outlay and will help ensure that all resources are used efficiently. A marketing budget will be established which will determine the potential effectiveness of the plan. Performance measures will be established so that the success of the plan can be measured against the cost of implementation. A schedule will be created that will outline the intended implementation. The schedule will quite often contain Key Performance Indicators (KPI’s), which can be used to monitor the on-going success or failure of the plan. The marketing team will liaise with the other stake holders included in the plan to ensure that it is implemented as intended.
Why Is A Marketing Plan So Important?
A marketing plan is essential if you are looking to get any product or service to market. Without it you will be working blind, with little direction or sense of purpose and without budget. A good marketing plan will establish all of the essential factors that you need to consider in order for your product or service to be a success. Any business creating a marketing plan will establish:
1. Target Market. Who is the end user? What are the sales channels where by the product or service can delivered to market? What are the strengths of the business in relation to bringing the product or service to the end user? Who is the competition? What are the unique selling points of the product or service? These are all very important questions. If the business has not established the answers to these in their plan they will be in part relying on luck. A good marketing plan will establish exactly who their end user is. It will also establish how they will deliver the product to market, which will include the most effective sales channels, ie the internet or a physical location.
2. Media. The results of the analysis of the target market will help establish how best to advertise the product or service, which will include the most effective media for the potential advertising campaign. The choice of advertising campaign may also be affected by budgetary constraints, but should always remain highly targeted and relevant to the identified end user.
3. Budget. The marketing plan will help establish how much the business will need to outlay for its successful delivery. Businesses should be realistic. The old adage of speculate to accumulate works here, but the business should never jeopardize its financial security by over committing; which is easily done in relation to promotional costs. The budget should be heavily focused on Return On Investment (ROI) and tangible results should be forecast based on any outlay.
4. Implementation. All good marketing plans will have a schedule of events and anticipated results. It is vital that the schedule is maintained and monitored to ensure successful delivery in line with the company’s mission statement and stated goals.
It is clear that a good marketing plan should be a cornerstone to any successful business. If you have not established your target audience, route to market and budget it is very difficult monitor and maintain strong commercial performance. Marketing plans are effective regardless of the size of the business; the only aspect of the plan that would need to be adjusted is the scale in relation to the size of the business. It is also important to remember though that any plan will only be as good as its implementation. As with most factors in business; action will lead to results.