1. Chapter 15 Developing An Entrepreneurial Marketing Plan

2. Copyright © Houghton Mifflin Company. All rights reserved.15 | 2 Learning Objectives Discuss the role of the product adoption/diffusion curve for marketing strategy Explain how to create an effective marketing plan Discuss the forms of advertising and promotion that entrepreneur can tap Describe the role of publicity Explain how entrepreneurs can employ new media to their advantage Discuss the role of personal selling in a marketing strategy

3. Copyright © Houghton Mifflin Company. All rights reserved.15 | 3 The Product Adoption/Diffusion Curve Groups customers into categories based on how quickly they adopt a new product Innovators Early adopters Early majority Late majority Laggards

4. Copyright © Houghton Mifflin Company. All rights reserved.15 | 4 Figure 15.2: New Product Adoption/Diffusion Curve

5. Copyright © Houghton Mifflin Company. All rights reserved.15 | 5 Figure 15.3: The Technology Adoption-Diffusion Curve

6. Copyright © Houghton Mifflin Company. All rights reserved.15 | 6 The Marketing Plan Details the strategies and tactics that will create customer awareness Builds a brand and a develops a loyal customer base Provides a consistent message to the customer and creates an opportunity for the entrepreneur to make a sale

7. Copyright © Houghton Mifflin Company. All rights reserved.15 | 7 The Marketing Plan (continued) Steps prior to writing the marketing plan –Define the approach to the market Message Differentiation tactics Channel strategies Performance goals –Define the value proposition –Analyze and rank the marketing options –Establish sales and marketing goals (SMART)

8. Copyright © Houghton Mifflin Company. All rights reserved.15 | 8 The Marketing Plan (continued) The marketing plan in one paragraph… –Contents Purpose of the marketing plan Benefits of the product/service The target market The market niche The marketing tactics The company’s convictions and identity The percentage of sales represented by the marketing budget

9. Copyright © Houghton Mifflin Company. All rights reserved.15 | 9 5 P’s of Marketing People Product Price Place Promotion –Advertising and promotional goals –The media plan

10. Copyright © Houghton Mifflin Company. All rights reserved.15 | 10 Marketing Plan Outline One-paragraph overview of the marketing plan Key marketing issues that will affect company success Launch objectives and milestones Brand strategy Strategic alignment Assessing effectiveness

11. Copyright © Houghton Mifflin Company. All rights reserved.15 | 11 Advertising and Promotion Advertising is employed to pull the product through the distribution channel (Pull strategy) Promotion tends to be more price-focused or incentive-focused (Push strategy)

12. Copyright © Houghton Mifflin Company. All rights reserved.15 | 12 Push vs. Pull Strategy Factors to ConsiderUse Advertising (Pull)Use Promotion (Push) Price sensitivityNot effectiveEffective Brand loyaltyHigh loyaltyLow loyalty Need for informationHigh needLow need Risk – switching costs, learning curve High risk for customerLow risk for customer Product life cycle stageGrowing or matureNew product or declining product Market statusHigh market shareLow market share Purchasing patternPredictableUnpredictable Contribution to profitAbove averageBelow average DifferentiationStrong differentiationLittle differentiation

13. Copyright © Houghton Mifflin Company. All rights reserved.15 | 13 Advertising Media Print –Newspapers –Magazines –Direct marketing (direct mail, telemarketing) –Yellow Pages –Signs Broadcast Media –Radio –Television

14. Copyright © Houghton Mifflin Company. All rights reserved.15 | 14 Taking Advantage of Publicity Publicity and word-of-mouth (referrals) are two of the most effective entrepreneurial marketing tools around because they don’t cost the company any money –Require a compelling story –Network with the media –Issue a press release

15. Copyright © Houghton Mifflin Company. All rights reserved.15 | 15 Constructing an Effective Press Release Contents: –Date –Name of contact person –Phone number –Release date –Descriptive headline –Release information –The who, what, where, when, and why –Photo/Illustration –Explanatory note regarding why the release was sent

16. Copyright © Houghton Mifflin Company. All rights reserved.15 | 16 Getting Customer Referrals Ask satisfied current customers Take a customer to lunch to get ideas Do a global Internet search on rumors Conduct in-depth third party interviews Administering an open-ended online survey Host an online discussion Create a customer advisory board

17. Copyright © Houghton Mifflin Company. All rights reserved.15 | 17 Giving It Away When the customer is likely to return The cost for each additional item is low and margins are high When customers need to try the product/service in order to risk the money to buy it When samples of the product/service can be offered at a large event

18. Copyright © Houghton Mifflin Company. All rights reserved.15 | 18 Internet Marketing and New Media Internet advertising will be a $26 billion dollar market in 2009 Traditional media boundaries disappearing Barriers to content creation have been breached New challenges and opportunities for entrepreneurs

19. Copyright © Houghton Mifflin Company. All rights reserved.15 | 19 Internet Marketing and New Media (continued) Social Media Search Engine Marketing Affiliate Programs Privacy Issues

20. Copyright © Houghton Mifflin Company. All rights reserved.15 | 20 Personal Selling Become a value-added company by tailoring products to meet customer’ needs Improve personal selling skills –What do customers want from the sale? –Give them what they want Trade shows and exhibits –Expose products –Network on site and after the show –Rent a hospitality suite

21. Copyright © Houghton Mifflin Company. All rights reserved.15 | 21 Customer Relationship Management CRM is a system for gathering/using customer information which combines –Technology –Training –Business strategy The CRM system contains –Names –Addresses –Attributes of people who are likely to purchase

22. Copyright © Houghton Mifflin Company. All rights reserved.15 | 22 Identifying and Rewarding the Best Customers For many companies 24 percent of its customers account for 95 percent of its revenues Calculate lifetime customer value

23. Copyright © Houghton Mifflin Company. All rights reserved.15 | 23 Complaint Marketing A dissatisfied customer will probably tell at least nine other people about the problem Complaints should be viewed as opportunities for continual improvement Satisfaction surveys

24. Copyright © Houghton Mifflin Company. All rights reserved.15 | 24 Review… Product adoption/diffusion curve for marketing strategy Create an effective marketing plan Forms of advertising and promotion that entrepreneur can tap Role of publicity Entrepreneurs can employ new media to their advantage Personal selling in a marketing strategy