Marketing Plan By Bruce R. Barringer, PhD Department of Management University of Central Florida Orlando, FL 32816 Email: [email_address]
A marketing plan articulates its marketing strategy, it’s positioning, and its points of differentiation, and then talk about how these overall aspects of its plan will be supported by its price, its promotional mix and sales process, and its distribution strategy.
A firm’s marketing strategy is its approach to marketing is products and services stated in broad terms, which forms the basis of all of its marketing related activities. It’s a good idea to begin the marketing plan section of a business plan by articulating your marketing strategy, because it sets the tone for the entire section .
You should also clearly articulate early in the marketing plan section of your business plan your specific points of differentiation. Limit the points of differentiation that you talk about to two or three points, to make them memorable and distinct. Also, make sure that the value of these points is easy for your reader to see. A useful way for a startup to visually depict its primary point of differentiation is through a product attribute map. A product attribute map is created by articulating two of a products most important attributes, one on the x-axis of the map and the other on the y-axis. A firm then simply plots itself relative to its major competitors
Product Attribute Map
This slide explains how your plan to price your product or service. Price is an important issue because it determines how much money a company can earn. The price a company charges for its products also sends a clear message to its target customers. Cost-based vs. Value-Based Pricing There are two methods for determining the price of a product or service: cost-based and value-based pricing. In cost-based pricing, the list price is determined by adding a markup percentage to a product’s cost. In value-based pricing, the list price is determined by estimating what consumers are willing to pay for a product and then backing off a bit to provide a cushion. What a customer is willing to pay is determined by the perceived value of the product and by the number of choices available in the marketplace
A firm’s promotions mix refers to the specific tactics it uses, such as advertising and public relations, to support the sales process and enhance its overall brand. The process varies by firm, but normally includes the following steps: 1. Prospecting (or sales lead) 2. The initial contact 3. Qualifying the lead 4. Sales presentation 5. Meeting objections and concerns 6. Closing the sale 7. Follow up
A firm’s promotions mix includes the specific tactics that a firm uses to communicate with its potential customers. The approaches to promotions discussed here include advertising, public relations, and other promotions related activities
Advertising is making people aware of a product in hopes of persuading them to buy it. The major goals of advertising are to raise customer awareness of a product, explain a product’s comparative features and benefits, and create an association between a product and a certain lifestyle (or a certain objective in a business to business context). These goals can be accomplished through a number of media, including direct mail, magazines, newspapers, radio, the Internet, television, and billboard advertising.
Public relations refers to efforts to establish and maintain a company’s image with the public. The major difference between public relations and advertising is that public relations isn’t paid for. As a result, many start-ups emphasize public relations over advertising because it’s free and it helps build the firm’s credibility. Some of the more common techniques are as follows: Press release. Media coverage. Articles about the firm in local newspapers, national magazines, or industry press. Blogging. Monthly newsletter. Civic, social, and community involvement. In most cases, firms believe that generating favorable public relations about their company is better than advertising because it is more grass routes and doesn’t seem to be as self-serving
Distribution encompasses all the activities that move a firm’s product from its place of origin to the consumer The key to making the right choices among these alternatives is to think carefully first about where people in your target market shop, and then about the most effective and economical ways to get your products some shelf space in those outlets.
The description of your distribution and sales plan should make it clear whether you plan to field your own sales force. If you plan to distribute your products through intermediaries, you should briefly explain how the intermediaries will be chosen, and the ways in which the intermediaries will interface with the sales outlets in your industry
SEM 5 - B.P- LEC.5c
7-1 Chapter Seven Marketing Plan Dr. Bruce Barringer University of Central Florida