CHPTER 6 The Marketing Plan By T. Norah Al Jasser

Understanding the Marketing Plan Marketing plan - A written statement of marketing objectives, strategies, and activities to be followed in business plan. It is designed to provide answers to 3 basic questions: Where have we been? Where do we want to go (in the short term)? How do we get there?

Selecting a Market and Establishing a Position in the Market Important Question That All Startups Must Ask (Who are our customers are how will we attract them?) by following a three-step process: Segmenting the market. Selecting a target market. Establishing a unique position in the target market

Place (or distribution) The marketing plan will consist of four important marketing variables, called the Marketing Mix “The Four Ps of Marketing for New Ventures” Product Price Marketing Mix Place (or distribution) Promotion

Marketing mix: A combination of product, price, promotion, and distribution and other marketing activities needed to meet marketing objectives. Product Is the good or service a firm offers to its target market. The initial rollout is one of the most critical times in the marketing of a new product. All firms face the challenge that they are unknown and that it takes a leap of faith for the first customers to buy their products.

2. Price: Price is the amount of money consumers pay to buy a product. Most entrepreneurs use one of two methods to set the price for their products: Cost-Based Pricing Value-Based Pricing

Core Product vs. Actual Product Cost-Based Pricing Value-Based Pricing The list price is determined by adding a markup percentage to a product’s cost. The list price is determined by estimating what consumers are will to pay for a product.

3. Promotion: Advertising Refers to the activities the firm takes to communicate the merits of its product to its target market. There are several common activities that entrepreneurs use to promote their products and services such as: Advertising Advertising is making people aware of a product or service in hopes of persuading them to buy it.

Pluses and Minuses of Advertising Raise customer awareness of a product. Explain a product’s comparative features and benefits. Create associations between a product and a certain lifestyle. Minuses Low credibility. The possibility that a high percentage of people who see the add will not be interested . Relative costliness compared to other forms of promotion.

Steps Involved in Putting Together an Advertisement

B. Google Ad Words: C . Public Relations: Allows advertisers to buy keywords on the Google home page. Advertisers pay a certain amount per click. The program includes local, national, and international distribution C . Public Relations: One of the most cost-effective ways to increase the awareness of the products of a company The major difference between public relations and advertising is that public relations is not paid for.

4 .Distribution: Involves all the activities that move a firm’s product from its place to the consumer. The firm should decide how to sell its products, directly to consumers or through intermediaries (such as wholesalers and retailers). The decision depends on how a firm believes its target market wants to buy its product.

Selling Direct Versus Selling Through a Intermediary 2 of 2

Marketing Research for the New Venture Step One: Defining the Purpose or Objectives How -Make a list of the information that will be needed to prepare the marketing plan. Marketing objectives define what you want to accomplish through your marketing activities. There are several important factors to consider when establishing effective marketing objectives. SMART Approach = Setting specific, measurable, achievable, realistic and time specific objectives

Step Two: Gathering Data from Secondary Sources Secondary sources can include trade magazines, newspaper articles, libraries, government agencies, the Internet, and commercial data.

Analyzing and Interpreting the Results Step Three: Gathering Information from Primary Sources Data collection procedures - Observation, networking, interviewing, focus groups, and experimentation. Data collection instrument - Questionnaire. Step Four: Analyzing and Interpreting the Results Results can be tabulated by hand or on a computer.

Characteristics 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.

10 Steps in Preparing the Marketing Plan Defining the Business Situation: Situation analysis Is a review of where the company has been and considers many of the environmental factors. The entrepreneur should provide a review of past performance of the product and the company. Industry analysis should include information on market size, growth rate, suppliers, new entries, and economic conditions.

In case of a new venture After a new venture has started up information should relate to: Present market conditions. Performance of the company’s goods and services. Future opportunities or prospects.

2.Defining the Target Market/ Opportunities and Threats : Steps in Preparing the Marketing Plan (cont.) 2.Defining the Target Market/ Opportunities and Threats : Process of segmenting and targeting customers on general market or industry . Divide market into smaller groups based on: Characteristics of the customer – Geographic, demographic, and psychographic. Buying situation – Desired benefits, usage, buying conditions, and awareness of buying intention.

Market segmentation - Dividing a market into definable and measurable groups for purposes of targeting marketing strategy. The Target market - is specific group of potential customers toward which the venture aims its marketing plan.

3 .Considering Strengths and Weaknesses: Steps in Preparing the Marketing Plan (cont.) 3 .Considering Strengths and Weaknesses: It is important for the entrepreneur to consider its strengths and weaknesses.

4.Establishing Goals and Objectives Steps in Preparing the Marketing Plan (cont.) 4.Establishing Goals and Objectives These are statements of level of performance desired by new venture. These goals should specify such things as market share, profit, sales, market penetration, pricing policy, and advertising support. Realistic and specific marketing goals and objectives respond to the question: “Where do we want to go?”. Not all goals and objectives must be quantifiable. Goals should represent key areas to ensure marketing success.

5. Defining Marketing Strategy and Action Programs Marketing Strategy Steps in Preparing the Marketing Plan (cont.) 5. Defining Marketing Strategy and Action Programs Marketing Strategy Consumer VS Business-to-Business Markets Business-to-business markets involves selling of products or services to another business. Usually aims at selling a large volume in one transaction. Involves a more direct channel of distribution. --Consumer markets Involve sales to households for personal consumption.

6.Coordination of the Planning Process Steps in Preparing the Marketing Plan (cont.) 6.Coordination of the Planning Process The management team must coordinate the planning process. The entrepreneur may be the only person involved but may lack experience in preparing the plan.

7. Designing Responsibility for Implementation: Steps in Preparing the Marketing Plan (cont.) 7. Designing Responsibility for Implementation: The plan must be implemented effectively to meet all of the desired goals and objectives. Someone must take the responsibility for implementing each decision made in the marketing plan

8. Budgeting the marketing strategy : Steps in Preparing the Marketing Plan (cont.) 8. Budgeting the marketing strategy : Costs should be reasonably clear. Assumptions, if necessary, should be clearly stated. This budgeting will be Useful in preparing the financial plan. 9. Implementation of the marketing plan: The plan is meant to be a commitment by the entrepreneur to a specific strategy. A commitment to make adjustments as needed by market conditions is also valuable.

Involves tracking results of the marketing effort. Steps in Preparing the Marketing Plan (cont.) 10.Monitoring the Progress of Marketing Actions: Involves tracking results of the marketing effort.

Minor adjustments in the plan are normal; significant changes indicate a poorly prepared plan. 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.

H.W NOW ITS TIME TO START THINKING AND WRITING ABOUT UR MARKETING STARTEGY START WORKING ON IT? ALWAYES THINK BIG TO REACH WHAT YOU PALN FOR ENJOY IT 