Creating A Marketing Plan


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Slides to help a small business think about and work through in order to create a marketing plan.

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Creating A Marketing Plan

  1. 1. Nick Webbe Trevor Lever Creating a Marketing Plan
  2. 2. Where are you now? Developing an agreed understanding of where the business currently stands
  3. 3. Where are you now? y • Write a brief summary of your current business position. • Things you might mention include: – Sales – Markets – Customers – Competition – Products
  4. 4. Internal Information • Too much data not enough information • Information is not always agreed on • Information is in the wrong format • Have you defined what information you need, or are you j t working with what you can just ki ith h t get?
  5. 5. External Information • What external information do you have access to as well?
  6. 6. Where are we now? • Consists of documenting both internal and external information relative to the business • Internal Information – Hi t i l Sales, P&L, Sales Forecast, Account Historical S l P&L S l F t A t Analysis, Turnover / Market Segment / Product… •E External Information lI f i – Market Reports, Government Statistics, Trade Directories, Web, Competition, Trade Forums, Companies House…
  7. 7. SWOT Analysis y • SWOT = – Strengths – Weaknesses – Opportunities – Threats • For a company, product, market etc.
  8. 8. SWOT Analysis y Positive Negative Internal Strengths Weaknesses External Opportunities Threats
  9. 9. SWOT Analysis: Company y p y Strengths Weaknesses Part of large UK group Sales in UK stagnant Good Image – Quality Company Products thought of as “old Good Resources – financial, fashioned” f hi d” technical Few marketing staff Established export sales p Website is dated Opportunities Threats Parent company in acquisitive Low priced Low-priced Japanese competition mode Local niche competitors New group R& facility Exchange rate Academic joint ventures Loss of patent L f t t Asia factory
  10. 10. SWOT Analysis: Product ABC y Strengths Weaknesses Market Leader Limited options and accessories Established Poor academic position Large customer base Service Reliability Opportunities Threats Move manufacturing to Asia Alliance between competitors New accessories open new Improved service from XYZ markets New product from DEF Low-Cost 2nd generation model
  11. 11. SWOT Analysis y • Strengths => Exploit g p • Weaknesses => Overcome • Opportunities => Grasp • Threats => Defend One of the most important parts of the planning p p p g process. SWOT Analysis asks the questions that enable you to decide if the company and its y p y products can fulfil your plan
  12. 12. Opportunities / Threats pp Likelihood High Low L High ortance Impo Low
  13. 13. Situation Analysis y • Review Economic & Business Climate • How do we do this?
  14. 14. PEST Analysis y Political Economic Social Technology
  15. 15. Summary y • Should now be able to agree and document the current position of the company. • This might be stated by: – Product – Market – Geography – Competition – Oth ? Other?
  16. 16. Where might we go? A collection of tools and ideas that can be used to develop different business strategies
  17. 17. Destination Options? p • Sell up after 3 years with quantified equity to retire • Grow business to turnover X by buying others • Pass profitable business onto kids p • Be first person in my street with a Mercedes • W k 3 days a week but maintain current Work d kb t i t i t income
  18. 18. What are your destination options? y p • If you have had to think for more than 5 seconds – then you’ve just made it up
  19. 19. What is marketing? g • Marketing is the vehicle that gets the business g g to its destination • However, it cannot function without a defined destination • A business going nowhere – will usually get there • You cannot get to London on the M5
  20. 20. Marketing is not g • Something that only big companies do g y g p • Something that always costs lots of money • Something that is always very difficult to do •S Something that i full of jargon thi th t is f ll f j • Something that is an optional extra
  21. 21. What is Marketing? g • Marketing is a business philosophy. It s a philosophy It’s way of thinking • The company seeks to solve customers’ problems to their complete satisfaction whilst creating maximum profit to the company • It’s a long term thing • Marketing means solving customers’ problems profitably
  22. 22. How do you do it? y • Define the problem(s) that the company can solve • Define the customer group(s) who have these problems • Define the customer group(s) with these problems the company can serve profitably • Define the method(s) of communicating with them
  23. 23. Four Step Programme p g • Define the problem(s) • What are the problems that we can solve could we solve others solve, • Define the customer group(s) • How can we segment into meaningful groups • Define the group(s) that can be served profitably • Which can we serve profitably and which will cost us money • Define the method(s) of communicating with them • What is the best medium to convince customers that we can solve their problems
  24. 24. Customers / Problems Matrix Problem 1 Problem 2 Problem 3 Group A Group B p Group C
  25. 25. Marketing Summary g y • Marketing places the customer at the centre of the business • The objective of the enterprise is to satisfy customers above their expectation and make a good profit • This is very difficult to achieve. If it was easy, then everybody could do it
  27. 27. Customers And solving their problems
  28. 28. Customers Cost Money y • The real cost of doing business is the sum of the costs incurred in finding satisfying and keeping finding, customers • Customers are the only real assets of a company as they are the only source of revenue. • Costs fall into four categories – Acquisition costs q – Product/Service cost – Fulfilment costs – Retention costs R i
  29. 29. Customers Cost Money y • Fi di customers - A Finding t Acquisition Costs i iti C t – All those marketing and communication costs targeted at potential customers • Making it - Product / Service Costs – The prime manufacturing or service delivery costs - materials, labour and overhead • Delivering it - Fulfilment Costs – All costs incurred in creating the product and delivering it from the point of creation to the point of consumption • Keeping customers - Retention Costs – All those marketing and customer care costs targeted at existing customers
  30. 30. Finding and Keeping Customers g p g • Finding Customers - Acquisition Costs – You must be able to able to communicate with potential customers to convert them into actual customers – What to say – How to say it – What medium to use • Keeping Customers – Retention Costs – Customers need to believe that they should continue to buy from you and not try elsewhere – What to say – How to say it – What medium to use
  31. 31. Customer Segmentation g • What ways are there to classify the types of y y yp customer you currently sell to? • How do you do this at the moment? • Here a e so e opt o s to c ass y custo e s e e are some options classify customers…
  32. 32. Basic Customer Types yp Loyalty y y High Low High Box 1 Box 2 True friends Butterflies Profitability Box 3 Box 4 Barnacles Strangers Low
  33. 33. Add 5 of your customers to each box y Loyalty y y High Low High Box 1 Box 2 Profitability Box 3 Box 4 Low
  34. 34. True Friends True Friends – Good fit between customer’s needs and company s company’s offering – Highest profit potential • What actions should we take? – Build loyalty in thought and action – Communicate consistently but not too often – Delight them by delivering superior value – Beware of discounting = Barnacles
  35. 35. Butterflies Butterflies – Good fit between customer’s needs and company’s offering – High profit potential • What actions should we take? – Identify those that can be turned into True Friends – Profit from the remainder – Monitor profitability routinely
  36. 36. Barnacles Barnacles – Limited fit between customer’s needs and the company’s needs ’ d – Low profit potential • What actions should we take? – Learn to say “No” – Consider other products – Identify those than can be converted into True Friends d
  37. 37. Strangers g Strangers – Little fit between customer’s needs and the company’s offering ’ ff i – Lowest profit potential • What actions should we take? – Make no investment in these relationships – M k a profit on each transaction Make fit ht ti
  38. 38. Options for Business Growth p Products/Services oducts/Se v ces Existing New Existing Box 2 Box 1 Market Product Penetration Development Markets/Customers Box 3 Box 4 Market Diversification Development New
  39. 39. Business Growth • Market Penetration – This is a safe place to be but will not produce a significant revenue increase unless each customer buys more • Product Development – A good understanding of customer's needs reduces the risks involved in selling new products (cross selling up-selling) selling, up selling) • Market Development op – Go out and find new customers, either non users or competitive users • Diversification – Be very bold - develop new products and sell to new customers. customers Dangerous
  40. 40. What are your options for g y p growth? Products/Services oducts/Se v ces Existing New Existing Box 2 Box 1 Markets/Customers Box 3 Box 4 New
  41. 41. How are we going to get there?
  42. 42. Brands What is a brand? What does it do? What can be a brand?
  43. 43. How Brands Began g • Branding cattle with a hot iron goes back to 2,000 BC and still continues today where cattle are allowed to roam y • This way of identifying ownership was adapted to differentiate one grocery product (tea coffee, flour salt etc) from another (tea, coffee flour, salt, another. Prior to that these products were undifferentiated commodities • The branded product became the way to guarantee the quality and consistency of the product. This offered better value to customers f which they were prepared to pay more money for h h h d
  44. 44. What do Brands do? • They give the customer reassurance of the quality and consistency of th product i t f the d t • Th give something extra to th customer – it doesn’t j t They i thi t t the t d ’t just play music – it’s an iPod. It’s not just a training shoe it’s a lifestyle – Nike • Because they deliver more to the customer they command a customer, higher price
  45. 45. The Evolution of the Brand • When a business starts out the business o owner is the brand • As the business grows and begins to establish a reputation the business becomes the brand b th b d • As the business matures its product(s) become the brand
  46. 46. Why create Brands? y • The major payoffs are: – Creates consumer preference or even loyalty – Provides greater strength to withstand competitive pressure – Creates a stronger bargaining position in the supply chain pp y – Produces an improvement in profit
  47. 47. Your Competitive Advantage How to develop and maintain it
  48. 48. How do you compete in y y p your market? • How many competitors do you have? • How are you different from them? y • How do you compete against them? o o p aga • How do they compete against you?
  49. 49. What is Sustainable Competitive Advantage? a s us a a e Co pe e d a age • SCA is a distinctive way of competing. It is not just doing the same things more efficiently • It i not gene ted b a single activity – th t is generated by ingle ti it that competitors can easily copy • It is achieved by creating advantages in one area which allows you to create advantages in other area
  50. 50. Competitive Advantage p g Do you have a competitive advantage? What are you doing to create one?
  51. 51. Price Setting What is the value (£) to the customer in having their problem solved
  52. 52. What is the price? p • For a glass of water? • For a airline ticket to New York? • For a printer cartridge? • For AA breakdown cover? • For a mobile phone?
  53. 53. Pricing Plan g • Product pricing is one of the most fundamental decisions made by a company. • Price represents the amount of value that a customer has to give up in order to acquire your product. g p q y p
  54. 54. Pricing Plan g • Almost every aspect of the marketing of a product will impact upon the pricing decision. decision What are the key considerations in setting your price? – What is the prime cost of the product – What is the product’s perceived competitive advantage – What are the prices of competitive products – Is the product or service a strong brand
  55. 55. The Pricing Plan g Objectives Company’s Costs market p profile Legal THE constraints PRICING Competitors PLAN Customer’s Potential attitudes competitors Differentials
  56. 56. Marketing Communications What to say How to say it Who to say it to Where to say it
  57. 57. Marketing Communications g Marketing Communications Marketing Strategy Marketing Planning (Everything we talked about before lunch)
  58. 58. Marketing Communications g Marketing Communications Marketing Strategy Marketing Planning (Everything we talked about before lunch)
  59. 59. There are three different audiences • First time buyers/non users • Existing buyers • Competitive buyers
  60. 60. What to say and to whom? y First Time Buyers - Could this problem be yours? - Are you concerned by this? - W understand your situation We d t d it ti - Here is a possible solution
  61. 61. What to say and to whom? y - Existing Customers - Thanks for buying us - Lots of others are like you - We appreciate your custom - Relax, you’ve made the right decision - There is no need to look elsewhere
  62. 62. What to say and to whom? y - Competitive Buyers - You know you have this problem - You value an answer to this - Y h You have experience of a solution i f l ti - Here is a superior alternative
  63. 63. How to say it y • When communicating with customers it is not sufficient to say we exist and we have things to ll t sell you • It is the first step to building a relationship with the customer which is designed to be long term and mutually beneficial • The communication will be more powerful if it contains and idea which transcends the simple benefits of the product
  64. 64. Where to say it? y •Advertising – Powerful, expensive, takes time to work •Direct marketing – Powerful, good value, immediate •Sales Promotion – In store/on pack, good value, immediate •Internet – Need to promote website, very competitive •Events – Expensive but targeted audience
  65. 65. Where to say it? y •Public Affairs (PR) ( ) – Slow, opinion forming, not under your control •Selling – Requires intense knowledge of product and customers •Email Marketing – Cheap, low level background, controlled •Corporate Identity – Low Cost, essential sta t g po t Dangerous to do in-house o esse t a starting-point. a ge ous ouse •Networking – L Low cost, t k ti t takes time t work. N t controlled to k Not t ll d
  66. 66. Assessing Marketing Communications g g MEASURE ANALYSE ACTIVITY MODIFY
  67. 67. Marketing Communications g • Message – what is it you want to say? • Market – who is it you want to say it to? • Motive – why are you sending this message out? • Map – where is the message going to? • Moment – when is the right time to do it? g • Media – how will you communicate the message? • Motivation – what will encourage a response? g p • Measurement – how will you define and measure success? • Management g – how will you manage / review the p g y g program? • Money – what are the total costs?
  69. 69. Marketing Consistency Everything that can be given, shown, heard or seen by anybody who might want to buy your product must be consistent
  71. 71. Marketing Material g • There must be a consistent and appropriate look pp p and feel to all your business material: Business Cards Letterhead Brochures Product Information Presentations Case Studies Emails Newsletters Web Site Packaging
  72. 72. Repetition and Consistency p y
  73. 73. Marketing Collateral g Make it very easy for a potential customer to: – Understand what you do – Understand what problems you solve – Understand you are relevant to them – Make contact with you – Obtain relevant information from you y – Ultimately, to say “yes” to you
  74. 74. Advertisement or Announcement? • An advertisement creates a relationship d ti t between the brand and viewer/reader – It creates an understanding between the seller and the potential buyer – It persuades the potential buyer that the seller is best able to solve his/her problem • An announcement says we have stuff to sell p please will you buy it? y y
  76. 76. How to brief the experts p • Do not tell them what to do • Tell them what you want to achieve • Tell them the type of company you are • Tell them about the target customers • Tell them about the problems you solve Write all this down – use it to judge their work
  77. 77. Creating your Marketing Plan Putting it all together
  78. 78. Stages in creating a Marketing Plan g g g • Defines where are we now • Defines where are we going • Defines how will we get there g • Defines how will we know we have arrived
  79. 79. Marketing Plan - Structure g • Introduction – Overview of current situation •E Executive Summary ti S – 1 page A4 summary of the entire plan • Situation Analysis – Where are we now • Assumptions • S l History Sales Hi t • Key Markets • K Products Key P d t
  80. 80. Marketing Plan - Structure g • Marketing Objectives • Marketing Strategies • Sales Tactics • What are we doing & when • Sales / Promotions • Costs / Projected Profits / Cash-Flow • Controls and Measures • Resources
  81. 81. Marketing Planning ( g g (What & When) ) 2006 Marketing Communications Plan Messages: Jan Feb Mar Apr May June July Aug Sept Oct Nov Dec Total Advertsing yellow pages local press trade press total advertising Literature company brochure product overview case studies Direct Mail summer promotion newsletter Internet email newsletter ad-words web site updates Events seminars open-house PR case studies new premises new staff Promotional Gifts seminar gift mouse mats
  82. 82. The Marketing Plan g • Management Summary: Provides an g y overview of your marketing plan and what you feel the marketing function should deliver g • Situation Analysis: What business you are in and the key issues and objectives • Targets: Sales target for the year ahead + the th number of contracts / clients you will need b f t t li t ill d in order to hit your sales target
  83. 83. The Marketing Plan g • Market Overview: Your target market in terms of geography, client types, needs and trends, market growth • Market Research: How many potential new clients are there? Profiles of different types of client. Analysis of their specific needs • Competitive Analysis: Approximate number of competitors. Brief profiles key competitors, competito s B ief p ofiles of ke competito s including: SWOT analysis; key products / services; how they differentiate themselves
  84. 84. The Marketing Plan g • Segmentation Strategy: Smart businesses focus on niche market areas. Thi k hard about this – it i h k t Think h d b t thi may be the single most important thing you do • Positioning Strategy: How do you want clients to p perceive you in your marketplace? For example - y y p p Lowest price? Best service? Highest quality? This is all part of the differentiation process... • Differentiation: Your decisions on segmentation and positioning, combined with your competitive analysis, will help you to decide on how you are going to make your business 'stand out from the crowd'
  85. 85. What do you do with the plan? y p • Written Down • Agreed • Circulated • Acted Upon • Reference for future decision making
  86. 86. Thank You Emaiil: Website: www trevorleverconsulting com Blog: Blog: www trevorlever co uk Twitter: @RealTrevorLever Facebook: Trevor_Lever Trevor Lever Ecademy: Trevor_Lever Skype: Trevor.Lever