8-2Industry Analysis It provides sufficient knowledge of theenvironment that can affect marketingstrategy decision making. Information can be gathered throughsecondary sources and market research. The entrepreneur can begin to understandcompetitors’ strengths and weaknesses;provides insight into how to positionproducts or services.
8-3 Competitor Analysis Document current strategies of primarycompetitors. Information can be utilized to formulate themarket positioning strategy. This analysis provides a solid basis for marketingdecision making.Industry Analysis (cont.)
8-4Marketing Research for the NewVenture Step One: Defining the Purpose orObjectives Make a list of the information that will beneeded to prepare the marketing plan. Step Two: Gathering Data from SecondarySources Secondary sources can include trade magazines,newspaper articles, libraries, governmentagencies, the Internet, and commercial data.
8-5 Step Three: Gathering Information fromPrimary Sources Data collection procedures - Observation,networking, interviewing, focus groups, andexperimentation. Data collection instrument - Questionnaire.Marketing Research for the NewVenture (cont.)
8-7 Step Four: Analyzing and Interpreting theResults Results can be tabulated by hand or on acomputer. Evaluated and interpreted should be based onresearch objectives. Cross-tabulated data can provide more focusedresults.Marketing Research for the NewVenture (cont.)
8-8Understanding the Marketing Plan Marketing plan - A written statement ofmarketing objectives, strategies, andactivities to be followed in business plan. It is designed to provide answers to threebasic questions: Where have we been? Where do we want to go (in the short term)? How do we get there?
8-9Characteristics of a Marketing Plan A marketing plan should: Provide a strategy. Be based on facts/assumptions. Describe an organization for implementation. Provide for short-term and long-term continuity. Be simple and short. Be flexible. Specify criteria for control.
8-11The Marketing Mix A combination of product, price, promotion,and distribution and other marketing activitiesneeded to meet marketing objectives.Variable Critical DecisionsProductQuality of components or materials, style, features, options, brand name,packaging, sizes, service availability, and warranties.PriceQuality image, list price, quantity, discounts, allowances for quickpayment, credit terms, and payment period.Channels ofdistributionUse of wholesalers and/or retailers, type of wholesalers or retailers, howmany, length of channel, geographic coverage, inventory, andtransportation.PromotionMedia alternatives, message, media budget, role of personal selling, salespromotion (displays, coupons, etc.), and media interest in publicity.
8-12Steps in Preparing the MarketingPlan Defining the Business Situation Situation analysis - Describes past and presentbusiness achievements of new venture. In case of a new venture, information shouldrelate to how and why the product or servicewas developed. After a new venture has started up informationshould relate to: Present market conditions. Performance of the company’s goods and services. Future opportunities or prospects.
8-13 Defining the Target Market/ Opportunitiesand Threats The target market is specific group of potentialcustomers toward which the venture aims itsmarketing plan. Market segmentation - Dividing a market intodefinable and measurable groups for purposes oftargeting marketing strategy.Steps in Preparing the MarketingPlan (cont.)
8-14 Process of segmenting and targeting customers Decide on general market or industry to pursue. Divide market into smaller groups based on: Characteristics of the customer – Geographic,demographic, and psychographic. Buying situation – Desired benefits, usage, buyingconditions, and awareness of buying intention. Select segment or segments to target. Develop a marketing plan integrating product, price,distribution, and promotion. Consider the strengths and weaknesses in thetarget market.Steps in Preparing the MarketingPlan (cont.)
8-15 Establishing Goals and Objectives These are statements of level of performancedesired by new venture. Realistic and specific marketing goals andobjectives respond to the question: “Where dowe want to go?”. Not all goals are quantifiable. Limit the number of goals or objectives tobetween six and eight. Goals should represent key areas to ensuremarketing success.Steps in Preparing the MarketingPlan (cont.)
8-16 Defining Marketing Strategy and ActionPrograms Product or service May consider more than the physical characteristics. Involves packaging, brand name, price, warranty,image, service, delivery time, features, style, and eventhe Web site. Pricing Costs - Material costs, labor costs, cost of goods fromsuppliers, labor and overhead expenses, etc. Margins or markups - Expected to cover overheadcosts and some profit. Competition.Steps in Preparing the MarketingPlan (cont.)
8-17 Distribution Provides utility to the consumer. Must also be consistent with other marketing mixvariables. Promotion To inform potential consumers about the product’savailability or to educate the consumer. Methods include print, radio, or television advertising,Internet, direct mail, trade magazines, or newspapers. The entrepreneur should considering both costs andeffectiveness of the medium in meeting the marketobjectives.Steps in Preparing the MarketingPlan (cont.)
8-18Table 8.8 - Major Considerations inChannel Selection
8-19 Marketing Strategy: Consumer versusBusiness-to-Business Markets Business-to-business markets involves selling ofproducts or services to another business. Usually aims at selling a large volume in onetransaction. Involves a more direct channel of distribution. Use trade magazine advertising, direct sales, and tradeshows. Consumer markets involve sales to householdsfor personal consumption.Steps in Preparing the MarketingPlan (cont.)
8-20 Budgeting and Implementation Budgeting Costs should be reasonably clear. Assumptions, if necessary, should be clearly stated. Useful in preparing the financial plan. Implementation The plan is meant to be a commitment by theentrepreneur to a specific strategy. Entrepreneur should ensure coordination andimplementation of the plan.Steps in Preparing the MarketingPlan (cont.)
8-21 Monitoring the Progress of MarketingActions Involves tracking results of the marketing effort. Entrepreneur should prepare for contingencies. Minor adjustments in the plan are normal;significant changes indicate a poorly preparedplan. Weaknesses in market planning may be due to: Poor analysis of the market and competitive strategy. Unrealistic goals and objectives. Poor implementation of the outlined plan actions. Unforeseen hazards like weather or war.Steps in Preparing the MarketingPlan (cont.)