Marketing plan
A well-written marketing plan must have a strong foundation in marketing strategy in order to achieve its objectives.
A marketing plan may include a list of tasks, but without a solid strategic base, it is of little use to a company.
Summary
The advertising and marketing strategies for the upcoming year are outlined in a comprehensive document or blueprint known as a marketing plan.
It describes the business operations necessary to achieve particular marketing goals within a predetermined time frame.
An overview of a company's current marketing position, a discussion of its target market, and a description of the marketing mix it will employ to meet its marketing objectives are all included in a marketing plan.
Although a marketing plan has a formal structure, it is very flexible and can be used as either a formal or informal document.
It includes past information, forecasts for the future, and techniques or plans to accomplish the marketing goals.
Market research is used to identify customer needs, and marketing plans then focus on how the company can meet those needs while making a respectable profit.
Processes like market analysis, action plans, budgets, sales forecasts, strategies, and projected financial statements are included in this.
A marketing plan can also be thought of as a strategy that aids a company in choosing how best to allocate its resources in order to meet overall goals.
It may also include a thorough evaluation of the advantages and disadvantages of a business, its structure, and its offerings.
The marketing plan outlines the step(s) or actions that will be taken to realize the objectives of the plan. A marketing strategy might, for instance, call for a 15% increase in market share for the company.
The objectives that must be met in order to achieve the 15% increase in market share for the company would then be described in the marketing plan.
The ways in which a business will use its marketing resources to achieve its marketing goals can be described in the marketing plan.
Markets are segmented, positions are determined, market sizes are projected, and a workable market share is planned within each market segment.
A thorough case for the introduction of a new product, a revision of the current marketing tactics for an existing product, or the creation of a company marketing plan for inclusion in the corporate or business plan can all be done using marketing planning.
Outline
A marketing strategy ought to be built around where a business needs to be in the future. Some of the most crucial components that businesses require when creating a marketing strategy are as follows:
- Market research: collecting information about the market the organization is currently operating in and classifying it. investigating the market's dynamics, trends, patrons, and current sales volume for the sector as a whole.
- Competition: The marketing strategy should list the company's rivals and the marketing tactics they're using. The strategy should outline how the company will differentiate itself from its rivals and what it will do to take the lead in the market.
- Market plan strategies: the creation of the organization's marketing and promotion plans. Advertising, direct marketing, educational initiatives, trade shows, websites, etc., are a few examples of such strategies.
- Marketing plan budget:The marketing plan's suggested strategies ought to fit within the allocated funds. The marketing plan's budget needs to be set after top managers have revised their goals for it and looked at their current financial situation.
- Marketing goals: Achievable marketing objectives should be included in the marketing plan. For instance, one objective might be to add 100 new clients to the existing clientele over the course of three months.
- Marketing Mix:The proper marketing mix should be assessed in the marketing plan. Setting up the product, price, place, and promotion is part of this process. The best combination of these four components that will meet the needs of the product's customer and maximize the company's profitability is eventually found.
- Monitoring of the marketing plan results: Analyzing the organization's current position should be a step in the marketing plan. The company must determine which strategies are effective and which ones are not.
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Purpose
Setting the business on a specific marketing course is one of the main goals of creating a marketing plan. The plan outlines how they attempt to achieve the goals, and the marketing goals typically align with the larger company objectives.
For instance, a new business that wants to expand will typically have a marketing strategy that emphasizes ways to grow their clientele. When creating a marketing plan and conducting market research, there are two options.
It can be consumed either internally or externally. While conducting external research, you are looking for ways to attract new customers while conducting internal research to improve the experience and products for current customers.
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Among the goals that can be connected to marketing planning are gaining market share, raising customer awareness, and fostering a positive company image.
In order to accomplish the objectives outlined in the marketing plan, the budget and resources required are also laid out in the marketing plan.
The marketing plan outlines the goals the business has for itself within its financial constraints and enables its executives to calculate the potential return on their marketing expenditures. The marketing plan has various components that relate to accountability.
The marketing strategy is a general duty from business executives and the marketing team to steer the company in a particular direction. Each task is assigned to a person or a team for implementation after the strategies are developed and the tasks are created.
Companies can monitor their milestones and communicate with the teams during the implementation process thanks to the assigned roles. The marketing strategy serves as a road map for achieving organizational objectives. It demonstrates how to achieve goals.
Company executives can develop and monitor the expectations for their functional areas with the aid of a marketing plan.
The company leaders may need to increase their sales staff in stores to help generate more sales, for instance, if a company's marketing plan goal is to increase sales growth.
The marketing strategy presents a special chance for an insightful conversation between staff members and company executives.
It promotes effective internal communication. The marketing team can analyze past choices and comprehend results through the marketing plan in order to better plan for the future. Additionally, it enables the marketing team to observe and research the environment in which they work.
Marketing planning aims and objectives
Although it is unclear, the "corporate mission," which in turn provides the context for these corporate objectives, will be found behind the corporate objectives, which by themselves provide the main context for the marketing plan.
The marketing planning function creates incentive pay plans in a sales-driven organization to not only fairly motivate and reward frontline staff, but also to align marketing activities with corporate mission.
The primary goal of the marketing strategy is to raise awareness of the company's solution among the target audience.
This "corporate mission" can be interpreted as a statement of the nature or purpose of the company, such as "Our business is..." This definition shouldn't be too restrictive because doing so will limit how the organization develops.
For example, IBM's early 1900s focus on the idea that "We are in the business of making meat-scales" may have restricted the company's later expansion into other fields.
However, it shouldn't be too broad or it will lose its meaning; for example, saying "We want to make a profit" won't be very helpful in coming up with specific plans.
Three dimensions were proposed by Jacob Zimmerem for the definition: "customer groups" to be served, "customer needs" to be met, and "technologies" to be employed. Consequently, the 1940s version of IBM's "corporate mission" could have been stated as follows:
"We are in the business of handling accounting information [customer need] for the larger US organizations [customer group] using punched cards [technology]."
The "corporate vision" is arguably the most crucial element in effective marketing. Surprisingly, it is largely ignored by marketing textbooks, but not by the well-known proponents of corporate strategy; in fact, it may have been the main focus of Peters and Waterman's book in the form of their "Superordinate Goals."
According to "In Search of Excellence," imagination is what propels advancement. The act comes first in thought
There is a good chance that the organization will establish a strong position in its markets if it has a strong vision for the future, and its chief executive in particular (and attain that future). This will be made possible, in part, by the fact that all staff members will support its strategies and ensure that they are consistent.
In this situation, the charismatic Watson dynasty's original "customer service" philosophy served as the foundation for all of IBM's marketing initiatives. At this point, getting a complete and accurate picture is the main priority.
Godley proposed the following "traditional" (though product-based) format for a "brand reference book" (or, in fact, a "marketing facts book") more than three decades ago:
- Financial data—The management accounting, costing, and finance sections will provide the information for this section.
- Product data—from development, production, and research. Sales and distribution information—Sections on sales, packaging, and distribution
- Information from these departments, including advertising, sales promotion, and merchandising data.
- Market data and miscellany—Market research is typically used as a source for this information. However, the capabilities of a sizable organization are assumed by his data sources. They would typically be gathered from a much smaller group of people in most organizations (and not a few of them would be generated by the marketing manager alone).
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Although a marketing audit can be a difficult process, its goal is straightforward: "it is only to identify those existing (external and internal) factors which will have a significant impact on the future plans of the company." It is obvious that the foundational information to be included in the marketing audit should be thorough.
The best strategy is therefore to continuously gather this information as it becomes available, as this reduces the otherwise heavy workload involved in gathering it as part of the regular, typically annual planning process itself when time is typically at a premium.
Nevertheless,the first step of this yearly procedure should be to ensure that the information contained in the current facts book or facts files is accurate and complete and can serve as a solid foundation for the marketing audit itself.
The facts book will be organized according to the needs of the organization, but Malcolm McDonald's straightforward format may be useful in many situations. This divides the content into three categories:
- Review of the marketing environment. An examination of the markets, clients, rivals, and overall economic, political, cultural, and technical environments of the organization; covering both emerging trends and the status quo.
- Review of the detailed marketing activity. A study of the company's marketing mix; in terms of the 7 Ps (see below)
- Review of the marketing system. an examination of the marketing organization, marketing research infrastructure, and present marketing goals and tactics. Too often, the last of these is disregarded. Since the validity of the entire marketing strategy depends on the accuracy of the data coming from the marketing system, the adage "garbage in, garbage out" needs to be applied with a vengeance.
- * Portfolio planning. Additionally, the coordinated planning of the various goods and services can help to create a portfolio that is well-balanced..
- * 80:20 rule. TThe marketing plan must be crystal clear, succinct, and easy to understand to have the greatest impact. The 20% of products or services and the 20% of customers that will make up the majority of sales and profits need to be the focus of the company.
- * 7 Ps: Product, location, pricing, advertising, physical environment, population, and process. The 7 Ps can occasionally take the focus away from the customer, but the framework they provide is very helpful in creating action plans.
The active phase of the marketing planning process doesn't start until this point (of choosing the marketing objectives).
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The key to the entire marketing process is in fact this upcoming stage of marketing planning. The "marketing objectives" outline exactly where the business plans to be at a given point in the future.
In a nutshell, goals (or objectives) state what must be accomplished and when results must be attained, but they do not specify "how" the results are to be attained, according to James Quinn.
Usually, they concern where certain goods (or services) will be available in certain markets (and must be realistically based on customer behavior in those markets).
They primarily concern the compatibility of those "products" and "markets." Pricing, distribution, advertising, and other lower-level objectives should not be confused with marketing goals.
They are a component of the marketing plan required to meet marketing goals. Objectives must be "quantifiable" and able to be measured in order to be most effective.
This measurement could be expressed in terms of sales volume, dollar value, market share, the percentage of distribution outlets that are penetrated, and so forth.
To "enter the market with product Y and capture 10% of the market by value within one year" is an example of a measurable marketing objective. As it is quantified, it can, within certain bounds, be clearly monitored and appropriate corrective action taken.
The financial goals of the company should typically serve as the foundation for the marketing objectives, which then translate these financial goals into the corresponding marketing measurements.
He continued by outlining his perspective on the function of "policies," with which strategy is most frequently conflated: "Policies are rules or directives that specify the "boundaries" of behavior."
In the framework presented here, marketing strategies are typically focused on the 8 Ps and can be thought of as the "game plan" or means by which marketing objectives will be accomplished. Examples include
- Price—The sum of money required to purchase goods
- Product—The actual product
- Promotion (advertising)—Getting the product known
- Placement—Where the product is sold
- People—Represent the business
- Physical environment—The environment's ambiance, tone, or mood
- Process—The value-added services that set the product apart from its rivals (e.g. after-sales service, warranties)
- Packaging—How the product will be protected
These plans outline how the goals will be accomplished in general. The 7 Ps provide a helpful framework for deciding how a company will strategically manipulate its resources to achieve its goals.
The 7 Ps are not the only framework, though, and they may draw attention away from more pressing problems.
The goals of the company must be the center of attention of its strategies, not the planning process itself. The 7 Ps may be a suitable framework for a business if they align with its strategies.
The chosen strategic options can be verbally described in the strategy statement in its purest form. Another, perhaps more enlightening option is to include a structured list of the main options selected.
Timing is a component of strategy that is frequently disregarded. It is crucial to time each component of the strategy. Sometimes, acting appropriately at the incorrect time can be almost as detrimental as acting inappropriately at the appropriate time.
Therefore, timing is a crucial component of any plan and should typically take the form of an activity schedule.
After completing this crucial phase of planning, objectives and strategies should be reviewed for viability in light of the market share, sales, expenses, profits, and other factors that these strategies require in actuality.
Employ judgment, experience, market research, or anything else that will help conclusions be seen from all possible angles, just like the rest of the marketing discipline.
These comprehensive plans may include all seven Ps of the marketing mix, but the emphasis will change based on the organization's unique strategies. A business that prioritizes its products will center each of the 7 Ps in its planning.
A business that is geographically or market-oriented will focus on each of those. Each will base its plans on the specific requirements of its customers as well as the methods chosen to meet those requirements. Effective uses are made of brochures and websites.
The detailed plans, which specify exactly which programs and individual activities will carry out during the plan period, are once again the most crucial component (usually over the next year). The plan cannot be monitored in the absence of these activities. Therefore, these strategies must be:
- Clear—They ought to be a clear declaration of "exactly" what needs to be done.
- Quantified—TEach activity's expected result should, to the extent possible, be quantified so that its performance can be tracked.
- Focused—Avoid the temptation to increase activity levels beyond what can be realistically controlled. The 80:20 Rule also holds true in this situation.
- Realistic—They should be achievable.
- Agreed—Those who will put them into practice need to be dedicated to them and believe they are doable. The plans that are produced should be used as a working document to direct the campaigns that will run throughout the organization during the plan's duration. Every deviation from the marketing plan must be investigated if it is to succeed, and any lessons learned must be applied to the plan for the following year.
Content of the marketing plan
Small Business Administration descriptions of competitors, along with information on the level of demand for the good or service and the competitors' advantages and disadvantages, are frequently included in marketing plans for small businesses.
- An explanation of the good or service, highlighting any unique characteristics
- Budget for marketing, which includes the strategy for advertising and promotional plan
- Description of the business location, including marketing benefits and drawbacks
- Pricing strategy
- Market Segmentation
Medium-sized and large organizations
A marketing plan's primary components are:
- Executive Summary
- Situational Analysis
- Opportunities / Issue Analysis—SWOT Analysis
- Objectives
- Marketing Strategy
- Action Program (the operational marketing plan itself for the period under review)
- Financial Forecast
- Controls
Specifically, a full marketing strategy typically consists of:
- Title Page
- Executive Summary
- Current Situation—Macro environment
- Economic State
- Legal State
- Governmental State
- Technological State
- Ecological State
- Sociocultural State
- Supply chain State
- Current Situation—Market Analysis
- Market definition
- Market size
- Market segmentation
- Industry structure and strategic groupings
- Porter 5 forces analysis
- Competition and market share
- competitors' strengths and weaknesses
- Market trends
- Current Situation—Consumer Analysis
- Nature of the buying decision
- Participants
- Demographics
- Psychographics
- Buyer motivation and expectations
- Loyalty segments
- Current Situation—Internal
- Company Resources
- Finances
- People (workforce)
- Time
- Skills
- Objectives
- Mission statement and Vision statement
- Corporate objectives
- Financial objective
- Marketing objectives
- Long-term objectives
- Description of the basic business philosophy
- Corporate Culture (Organizational Culture)
- Company Resources
- Summary of Situation Analysis
- External threats
- External opportunities
- Internal strengths
- Internal weaknesses
- Critical success factors in the industry
- Sustainable competitive advantage
- Marketing Research
- Information requirements
- Research methodology
- Research results
- Marketing Strategy–Product management
- Unique selling proposition (USP)
- Product mix
- Product strengths and weaknesses
- Perceptual mapping
- Product life cycle management and new product development
- Brand name, brand image, and brand equity
- Augmented product
- Product portfolio analysis
- B.C.G. Analysis
- Contribution margin analysis
- G.E. Multi Factoral analysis
- Quality Function Deployment
- Marketing Strategy—segmented marketing actions and market share objectives
- By product
- By customer segment
- By geographical market
- By distribution channel
- Marketing Strategy—Pricing
- Pricing objectives
- Pricing method (e.g.: cost plus, demand based, or competitor indexing)
- Pricing strategy (e.g.: skimming, or penetration)
- Discounts and allowances
- Price elasticity and customer sensitivity
- Price zoning
- break even analysis at various prices
- Marketing Strategy—Promotion
- Promotional goals
- Promotional Mix
- Advertising reach, frequency, flights, theme, and media
- Sales force requirements, techniques, and management
- Sales promotion
- Publicity and public relations
- Electronic Promotion (e.g.: web, or telephone)
- Word of Mouth marketing
- Viral Marketing
- Marketing Strategy—Distribution
- Geographical coverage
- Distribution channels
- Physical distribution and logistics
- Electronic distribution
- Implementation
- Personnel requirements
- Assigning responsibilities
- Giving incentives
- Training on selling methods
- Financial requirements
- Management information systems requirements
- Month-by-month agenda
- Gantt chart using PERT or critical path analysis systems
- Monitoring results and benchmarks
- Adjustment mechanism
- Contingencies (what ifs)
- Personnel requirements
- Financial Summary
- Assumptions
- Pro-forma monthly income statement
- Contribution margin analysis
- Breakeven analysis
- Monte Carlo method
- ISI: Internet Strategic Intelligence
- Scenarios
- Prediction of future scenarios
- Plan of action for each scenario
- Controls
- Performance indicator
- Feedback Mechanisms
- Appendix
- Pictures and specifications of products
- Results from completed research
Measurement of progress
The establishment of targets (or standards) allows for the monitoring of progress and is the last step in any marketing planning process.
In light of this, it's crucial to include both quantities and timelines in the marketing objectives (for instance, to capture 20% of the market by value within two years) and corresponding strategies. Marketers need to be prepared to modify their plans at any time.
How goals are being met should be specified in the marketing plan. Budgets, schedules, and marketing metrics are frequently used by managers for tracking and assessing results.
They can evaluate planned and actual spending for a given period by using the budget. Schedules enable management to compare the expected and actual completion dates of tasks.
To determine whether the business is making progress toward its goals, marketing metrics track the actual results of marketing campaigns (P. Kotler, K.L. Keller).
A specific action plan must be included in a marketing plan in addition to the previously mentioned components because planning is more about the outcomes than it is the plan itself.
Building a specific action plan improves the ability to measure the specific, concrete plans and ensures there is a follow-up of the eventual results.
The main goal of a marketing plan is to assess or measure the produced results.
It is crucial to understand that depending on the various marketing plans, a specific action plan is essential because it guarantees that all of the requirements are satisfied from a comprehensive standpoint.
For instance, when a business releases a new product, it's important to create a marketing strategy that details the tactics that will be employed to market the platform to the industry.
Fortunately, the incorporation of a specific action plan guarantees the successful implementation of all the strategies included in the marketing plan.
A specific action plan also guarantees that the company in question will be able to evaluate and track the success of its methods for introducing the new brand in the long run.
Forecasts frequently need to be updated due to environmental changes. The associated plans may also need to be modified in addition to these. One of the most crucial aspects of this is the ongoing evaluation of performance in comparison to predetermined goals.
But perhaps even more significant is the regular formal review's enforced discipline. The best (most realistic) planning cycle frequently centers around a quarterly review, just like with forecasts.
Best of all is probably a quarterly rolling review, which involves planning a full year in advance with each new quarter, at least in terms of the quantifiable aspects of the plans, if not the wealth of supporting detail.
Of course, this requires more planning resources, but it also guarantees that the plans reflect the most recent knowledge and, because of the constant attention they receive, forces both the plans and their implementation to be realistic.
Plans only have value if they are actually used to manage a company's development; their implementation, not their writing, determines whether they are successful.
Performance analysis
The most crucial aspects of marketing performance that are typically monitored are:
Sales analysis
Most businesses keep track of their sales figures or, in non-profits, things like the number of clients. The more advanced track them in terms of "sales variance"—the departure from the intended numbers—which enables a more immediate picture of deviations to emerge.
"Micro-analysis," which is just the standard management procedure for looking into specific issues, then looks into the particular components (such as specific products, sales territories, customers, and so forth) that are not performing up to expectations.
Despite the fact that market share is frequently a crucial metric, few companies track it. Absolute sales may increase in an expanding market, but a firm's market share may decline, which is bad news for future sales when the market begins to decline.
When tracking such market share, the following factors may be taken into consideration:
- overall market share
- segment share — that in the specific, targeted segment
- relative share
Expense analysis
The "marketing expense to sales ratio" is typically the key ratio to watch in this area, though it may be divided into other components (advertising to sales, sales administration to sales, and so on).
The term "expense analysis" refers to a thorough accounting of all costs a company faces. On a monthly, quarterly, and annual basis, it is produced.
It can be broken down into smaller groups for small businesses to find out how much money each component is costing the business.
Because it is used to align marketing spend with industry norms, the marketing expense-to-sales ratio is crucial to expense analysis in marketing. The ratio of marketing costs to sales aids the business in increasing the effectiveness of its marketing spend.
One of the five analysis tools used by marketers to manage and boost spending productivity is the marketing expense-to-sales analysis, along with analyses of sales, market share, finances, and market-based scorecards.
The ratio of marketing expenses to sales enables businesses to monitor actual spending in relation to the approved budget and in relation to the sales targets specified in the marketing plan.
Financial analysis
The net profit, at least in theory, should be the "bottom line" of marketing initiatives (for all except non-profit organizations, where the comparable emphasis may be on remaining within budgeted costs). There are various distinct performance metrics and important ratios that must be monitored, including:
- gross contribution<>net profit
- gross profit<>return on investment
- net contribution<>profit on sales
Comparing these results with those of other organizations, especially those in the same industry, can be extremely beneficial. Take, for example, the data that can be obtained (in the UK) from "The Centre for Interfirm Comparison."
However, those using PIMS (Profit Impact of Management Strategies), which was first developed by Harvard Business School and then started by the General Electric Company, typically use this approach in the most sophisticated manner.
the Strategic Planning Institute now in charge. The performance analyses mentioned above focus on the quantitative indicators that are most closely related to near-term performance.
The performance of the company in terms of its longer-term marketing strengths can also be determined by a number of indirect measures, which essentially track customer attitudes. As a result, these measures may be even more significant indicators. Among the helpful actions are:
- market research — incorporating client panels (which are used to track changes over time)
- lost business — the orders that were unsuccessful because, for instance, there was insufficient stock or the item did not meet the customer's exact specifications
- customer complaints — How many customers express dissatisfaction with the company's goods or services, or the company itself, and what
Use of marketing plans
Because it offers a clear reference point for actions taken during the planning period, a formal, written marketing plan is crucial. However, the planning process itself may be the most significant advantage of these plans.
This typically presents a rare opportunity, a forum, for in-depth discussions between the various managers involved that are productively focused. The plan, along with the discussions that go along with it, then gives their subsequent management activities, even those that aren't covered in the plan itself, a shared context.
Business plans also include marketing strategies, which provide information on how the company will develop and, most importantly, how investors will get a return on their investment.
Budgets as managerial tools
Budgets are the traditional way that a marketing plan is quantified. These are especially significant because they have been so carefully quantified.
They should, therefore, be a clear projection of the actions to be taken and the outcomes anticipated.
Additionally, they should be able to be accurately monitored; in fact, the primary (regular) management review process is performance against budget.
A marketing budget's goal is to compile all of the revenues and expenses related to marketing into one thorough document.
The budget is a management tool that aids in choosing priorities by balancing what must be spent against what can be afforded.
A budget can also be used to assess how well a company is performing in relation to its overall spending patterns.
The marketing budget is typically the most effective method for assessing the relationship between desired outcomes and financial resources.
The marketing strategies and plans that have already been developed in the marketing plan itself should serve as its starting point, even though in reality the two will operate concurrently and interact.
A thorough budget may at the very least lead to a change in the more optimistic aspects of a company's business plans.