The essence of marketing is to understand you customers' needs and develop a plan that surrounds those needs to create your offers. Let's face it anyone that has a business has a need and desire to grow their business. The most effective way to grow and expand your business is by focusing on organic growth.
You can increase organic growth in four different ways. They are:
All four of these increase your revenue and profit. Let me encourage you to focus on the first which is to acquire more customers. Why? By acquiring more customers you increase your customer base and your revenues then come from a larger base.
How can you use marketing to acquire more customers?
If you are like the majority of small business owners your marketing budget is limited. The most effective way to market your company is to create a well rounded program that combines sales activities with your marketing tactics. Your sales activities will not only decrease your out-of-pocket marketing expense but it also adds the value of interacting with your prospective customers and clients. This is priceless.
Small businesses typically have a
limited marketing budget, if any at all.
Does that mean you can't run
with the big dogs?
Absolutely not...
It just means you have to think a little more creatively. How about launching your marketing campaign by doing one of the following:
When you do spend money on marketing, don't forget to create a way to track those marketing efforts. You can do this by coding your ads, using multiple toll-free telephone numbers, and asking prospects where they heard about you. This enables you to notice when a marketing tactic stops working. You can then quickly replace it with a better choice or method.
When it comes to your customers keep in mind the importance of target marketing. The reason this is important is that only a proportion of the population is likely to purchase any products or service. By taking time pitch your sales and marketing efforts to the correct niche market you will be more productive and not waste your efforts or time.
It's important to consider your virtual segmentation by selecting particular verticals to present your offerings to. Those verticals will have particular likelihood of purchasing your products and services. Again, this saves you from wasting not only valuable time but also money.
By being diligent in your marketing and creating an easy strategy -- such as holding yourself accountable to contact 10 customers or potential customers daily five days a week -- you'll see your business grow at an exceptional rate. The great thing is it didn't take a large marketing budget to make it happen.
The Elements Of A Marketing Plan (Quick Fact Sheet)
The Basics
Many first-time business owners think that by simply placing an ad in a local newspaper or a commercial on a radio or a television station, customers will automatically flock to purchase their product or service. This is true to a certain extent... Some people are likely to learn about your business and visit, just out of curiosity. But hundreds, even thousands, of other potential customers may never learn of your business. Do develop an adequate marketing program.
What you as a potential business owner must do is maintain a thorough understanding of your marketing program, and use it to extract advantages from the marketplace. Go over different strategies and techniques until you understand how to apply them to get the results you desire. Remember, your aim is not only to attract and keep a steady group of loyal customers, but also to expand your customer base by identifying and attracting, new customers and to reduce risks by anticipating market shifts that can affect your bottom line.
To help you accomplish this aim, your marketing plan should include strategies typical of any marketing plan. The plan should especially include what marketers dub as the four P's of Marketing:
Review your plan. Make certain it contains the strategies listed below -- and then determine how these strategies will be applied by you. Include a brief explanation for each strategy.
Identify and describe your customers (target market) by their age, sex, income/educational levels, profession/career and residence. Know your customers better than you know anyone -- their likes, dislikes, expectations. Since you will have limited resources, target only those customers who are more likely to purchase your product. As your business grows and your customer base expands, then, you may need to consider modifying this section of the marketing plan to include other potential customers.
Identify the five nearest direct competitors and the indirect competitors. Start a file on each identifying their weaknesses and strengths. Keep files on their advertising and promotional materials and their pricing strategies. Review these files periodically determining when and how often they advertise, sponsor promotions and offer sales.
Try to describe the benefits of your goods from your customer's perspective. Emphasize its special features -- i.e., the unique selling points. Successful business owners know or at least have an idea of what their customers what or expect from them. This type of anticipation can be helpful in building customer satisfaction and loyalty.
Operating an effective marketing plan requires money, so you will have to allocate funds from your operating budget to cover advertising, promotional and all other costs associated with marketing. Develop a marketing budget based on the cost for the media you will use, and the cost for collecting research data and monitoring shifts in the marketplace.
Again, try to describe the location of your business from your customer's perspective. Describe its assets -- i.e., the convenience, whether or not public transportation is accessible, the safety aspects -- street lighting, well lit parking lot or facility, decor, etc. Your location should be built around your customers, it should be accessible -- and should provide a sound sense of security.
Although your pricing strategy may be based on the strategy devised by others, you should study this plan and the strategies used by competitors. That way you will acquire a thorough understanding of how to price your product, and you can determine if your prices are in line with competitors, if they are in line with industry averages and what adjustments you can make to bring them in line.
The key to success is to have an well-planned strategy, to establish your policies and to constantly monitor prices and operating costs to ensure profits. Keep abreast of changes in the marketplace because these changes can affect your bottom line.
Develop a promotional strategy that uses various media for promoting your business. Monitor the different media identifying those that most effectively promote your business. Concentrate on developing material for these formats that clearly identifies your services, its location and price.
Since financial institutions weigh the soundness
of your marketing plan when deciding whether your business is a good risk for
their money, it is important that you prepare and present credible market data
that shows there is a need in the community for your business and that
demonstrates your ability to compete.
A well-written, comprehensive marketing plan is the focal point of all business ventures because it describes how you plan to attract and retain customers, the most crucial aspect of a business. The marketing plan is essential to any successful business. It is the heart of the business, the basis from which all other operational and management plans are derived. Marketing offers you a wealth of information that if applied correctly virtually can ensure your success. Therefore, it is important that you, as a first-time business owner, develop a comprehensive, effective marketing plan.
An effective marketing plan will certainly boost your sales and increase your profit margins. You must be able to convince customers that you have the best product or service for them at the best possible price. If you cannot convince potential customers of this, then you are wasting your time and money. This is where the marketing plan comes into play, and this is why it is so important. By having a well thought out ,marketing plan, you'll be ahead of more than 90%+ of other small businesses that generally speaking, do not have one!
There are other numerous advantages you can extract from the marketplace -- if you know how. And the marketing plan is an excellent tool for identifying and developing strategies for extracting these advantages.
Now is good time to review what goes into a
marketing plan. Write down what you can remember on a blank sheet and then
compare it to the "Quick Fact Sheet" above. The marketing plan offers
numerous advantages; however, as you can see, there can be drawbacks as well.
Remember however, the advantages definitely outweigh the drawbacks and, you can
seek professional assistance when you are developing the marketing section of
your business plan. It may be worth the investment of both time and money.
How well your advertisements and promotions draw customers will ultimately determine how effective your marketing strategy is. It becomes your responsibility to cultivate your designated market, if you decide to market your products at all. One of the ways to do this is through advertising and promotions. Remember the aim of the advertising and promotional strategy is to create awareness of your products, to arouse customers' needs and expectations to the point of consumption and to create a loyal stream of satisfied customers who will continue to patronize your business.
Perhaps, the first step in developing an effective advertising and promotional strategy is to understand the difference between the two concepts. Most people think that advertising and promotions are one in the same; there is, however, a clear distinction between the two. While both advertising and promotions use the different media formats -- print, radio, and television -- as a way of conveying a message, promotion encompasses much more. It is the method of advertising and can entail community involvement. For example, this could mean sponsoring a Youth Organization, allowing non-profit organizations to use your facility, such as, letting the high school drama club use your parking lot for a car wash fund raiser, sending an underprivileged child to day camp, or involvement in any type of positive community activity that will bring much-welcomed attention to your business.
While advertising is a way of keeping your business is the public's eye -- promotions are a way of signaling that you are concerned and committed to the welfare of the community and its residents. This commitment may be one of the most effective techniques for building customer loyalty. People tend to be more supportive of businesses and organizations that give something to the community rather than those that just take from the community, never giving anything in return.
Advertising plays an important role in successful business ventures. It entails identifying and selecting the media that provide the greatest amount of exposure for your business and developing effective, yet appropriate materials for each medium. It is more than running an ad in a local newspaper, on a radio or television station or just simply hanging a sign outside your business and waiting for the customers to purchase your product. It requires that you know your product -- that is, the unique selling points -- and that you develop sales and marketing literature that can arouse the customers' consciousness levels to the point that they are curious enough to investigate it, and then raises their need or desire levels to the point that they are willing to purchase it.
Advertising keeps your products or services in the public's eye by creating a sense of awareness. Yet this awareness alone will not ensure the success of your business. Thus, advertising not only has to be effective, it also has to be a continuous process.
It may be a good idea to mix the different media formats that you use. For example, design a brochure that describes your products, emphasizing their unique selling points (special features). Place copies of the brochure in strategic locations of your business to use as customer handouts. Or, devise a customer survey. The survey should focus on whether customers like the products, the quality of the products, ways to improve it, the quality of service provided by staff -- their friendliness and courtesy. Place the survey with a self-addressed, stamped envelope near the check-out counter and ask customers to mail in or return the survey when they come back. Review their comments with staff and implement those suggestions that are practical, cost efficient and can improve the overall quality of service your business provides.
Newspaper, radio, or television ads (newspaper advertising is the least expensive and television advertising is the most expensive of these formats). You probably will need professional advice and assistance when developing ads for those media formats. The following media formats you probably can do yourself:
Whatever media format you use, be willing to invest the money needed to develop an effective ad campaign.
As discussed earlier, promotion entails more than just selecting the media format to market your business. It can, and oftentimes does, encompass community involvement. This involvement can range from sponsoring a Boy or Girl Scout troop to hosting a charity ball for senior citizens or allowing non-profit organizations to use your facilities.
Your approach to promoting your business should encompass more than creating a sense of awareness about your business. It should include a commitment to community involvement -- the desire to give something back to the community and its residents. An excellent way to foster this type of involvement is to meet with community leaders to find out how you can help, and what events are forthcoming that could or will require your assistance. Keep in mind that community leaders can be an excellent networking tool, especially if they feel your involvement is genuine.
Examples of community programs you can sponsor or take part in are:
Other inexpensive ways of promoting your business that doesn't encompass community involvement are:
While it is impossible for you to participate in every event or program in the community, you should at least get involved in one or two activities, even if it's only on a part-time basis. People tend to be more supportive of businesses, organizations or individuals who give something to the community. And... this is the image you especially want to project in your promotional activities.
No plan that anyone provides will show you how to
promote or advertise your business. These are techniques that you, yourself,
will have to develop. Talk it over with your mentor, business advisors,
neighboring businesses, family and friends, community leaders and so on... then
decide which activities you can afford to sponsor -- and have the time to
commit to before becoming involved. Involvement in the community doesn't
necessarily have a price tag attached. Find a project that you can afford, that
you have time for, and is of interest to you.
Marketing Plan Extras
PRICE / QUALITY MATRIX SALES APPEALS
| PRICE/QUALITY | HIGH | MEDIUM | LOW |
| HIGH | "Rolls Royce" Strategy | "We Try Harder" Strategy | "Best Buy" Strategy |
| MEDIUM | "Out Performs" Strategy | "Piece of the Rock" Strategy | "Smart Shopper" Strategy |
| LOW | "Feature Packed" Strategy | "Keeps on Ticking" Strategy | "Bargain Hunter" Strategy |
MARKETING PLAN - TIPS, TRICKS & TRAPS
1. Marketing Steps
2. Marketing Positioning
3. Sales Strategy
Use Customer-Oriented Selling Approach - By Constructing Agreement
Phase One: Establish Rapport with Customer - by agreeing to discuss what the customer wants to achieve.
Phase Two: Determine Customer Objective and Situational Factors - by agreeing on what the customer wants to achieve and those factors in the environment that will influence these results.
Phase Three: Recommend a Customer Action Plan - by agreeing that using your product will indeed achieve what customer wants.
Phase Four: Obtaining Customer Commitment - By agreeing that the customer will acquire your product.
Emphasize Customer Advantages
Must be Read: When a competitive advantage can not be demonstrated -- it will not translate into a benefit.
Must be Important to the Customer: When the perception of competitive advantage varies between supplier and customer -- the customer wins.
Must be Specific: When a competitive advantage lacks specificity, it translates into mere huff n' puffery -- and is ignored.
Must be Promotable: When a competitive advantage is proven -- it is essential that your customer know it, lest it not exist at all.
4. Benefits vs. Features
The six "O's" of
organizing Customer Buying Behavior
| ORIGINS of purchase: | Who buys it? |
| OBJECTIVES of purchase: | What do they need/buy? |
| OCCASIONS of purchase: | When do they buy it? |
| OUTLETS of purchase: | Where do they buy it? |
| OBJECTIVES of purchase: | Why do they buy it? |
| OPERATIONS of purchase: | How do they buy it? |
Convert features to benefits using the "...Which Means..." Transition
Sales Maxim:
"Unless the proposition appeals to their INTEREST, unless it satisfies their DESIRES, and unless it shows them a GAIN--then they will not buy!"
Quality Customer Leads:
Level of
need
Ability to pay
Authority to
pay
Accessibility
Sympathetic attitude
Business history
One-source
buyer
Reputation (price or quality buyer)
CONVERT FEATURES INTO
BENEFITS - THE "...WHICH MEANS..." TRANSITION
| FEATURES | "WHICH MEANS" | BENEFITS |
| Performance | Time Saved | |
| Reputation | Reduced Cost | |
| Components | Prestige | |
| Colors | Bigger Savings | |
| Sizes | Greater Profits | |
| Exclusive | Greater Convenience | |
| Uses | Uniform Production | |
| Applications | Uniform Accuracy | |
| Ruggedness | Continuous Output | |
| Delivery | Leadership | |
| Service | Increased Sales | |
| Price | Economy of Use | |
| Design | Ease of Use | |
| Availability | Reduced Inventory | |
| Installation | Low Operating Cost | |
| Promotion | Simplicity | |
| Lab Tests | Reduced Upkeep | |
| Terms | Reduced Waste | |
| Workmanship | Long Life |
BUYING MOTIVES
| RATIONAL (good) | EMOTIONAL (best) |
| Economy of Purchase Economy of Use Efficient Profits Increased Profits Durability Accurate Performance Labor-Saving Time-Saving Simple Construction Simple Operation Ease of Repair Ease of Installation Space-Saving Increased Production Availability Complete Servicing Good Workmanship Low Maintenance Thorough Research Desire to be Unique Curiosity |
Pride of Appearance Pride of Ownership Desire of Prestige Desire for Recognition Desire to Imitate Desire for Variety Safety Fear Desire to Create Desire for Security Convenience Desire to Be Unique Curiosity |
Even if you are not able to directly market your own products, writing a marketing plan will help you to sell or license your products to retailers and other interested parties. You will be able to intelligently discuss the market for your products with potential buyers.
This tutorial on writing a marketing plan will provide you with the following marketing know-how:
The key element of a successful marketing plan is to "know your customers", their likes, dislikes, and expectations. You must also know your competition (or similar inventions) and their strengths and weaknesses. By identifying these factors, you can develop a marketing strategy that will allow you to arouse and fulfill customers needs, better understand competitors and identify changes in the marketplace.
The purpose of the marketing plan is to define your market, identify your customers and competitors, outline a strategy for attracting and keeping customers -- and to identify and anticipate change.
Again, even if you do not wish to market your own products, having the above knowledge will impress sales professionals.
Understanding the Marketplace
The first step in understanding the market is to study it through market research.
This practice will help you to better understand how the marketplace operates relative to your products, and it can help you develop the skills necessary to identify and anticipate changes in the marketplace.
Start your own file on marketplace trends. Periodically review your data, looking for shifts in the market. If changes are occurring, you should modify your marketing plan to coincide with these changes.
A marketing plan should answer these questions:
Review your marketing plan to ensure that it answers these specific questions. If your current marketing plan doesn't answer the questions, it will need to be updated, modified or re-written.
When you are satisfied that you understand how the marketplace operates relative to your products... When you are satisfied that you understand how to identify market shifts and trends related to your products... You are ready to start writing the marketing plan section of your business plan.
It is your responsibility to promote
your products by cultivating the marketplace, and by attracting and keeping
customers. You can accomplish this aim by knowing your market, your customers,
your competitors and your products. By gathering and analyzing market research
information, you will be better able to determine if your marketing plan is in
line with your competitors, or if it is in line with industry averages and what
adjustments you can make to improve your overall competitiveness.
Researching your market is perhaps your easiest way to conquer the market. Market research does not have to be costly, nor does it have to be a complex process.
Market research can be as simple and as easy as surveying a cross-section of your consumers (a focus group) to get their opinions about the products that you will be offering, or conducting a telephone, or mail survey. However, one disadvantage of using the telephone or mail survey method is that the individuals you contact may not be interested in responding to a survey.
Other market research techniques include:
Whatever method you use, your focus should be on gathering enough information to determine who your potential customers are, their needs, wants, and expectations; and if there is a demand for your product; who your competitors are and how well they are doing.
Market research is often a costly and time-consuming process. There may be biases that: distort information; ignores answers; or lets arrogance or hostility cut off communications at some point in the marketing process. The advantages however, outweigh the disadvantages. Don't forego this process -- or stop halfway because you are not getting the desired results. This may be an indication that you are going with the wrong products -- or that there isn't a market for your products. Don't be discouraged. You simply may need to modify your original marketing plan.
While market research may appear to be a tedious, time-consuming process, it is often necessary if you want to be successful. Think of market research as simply a method of finding out what catches customers' attention by observing their actions and drawing conclusions from what you see or as an organized way of finding objective answers to questions every business owner and manager must answer in order to succeed.
Market research focuses and organizes marketing information, ensuring that it is timely and that it provides what you need to:
Market research is an invaluable tool that can
save you time, effort, and money.
MARKETING PLAN - PLANNING SHEET
This is the marketing plan of_____________________________________
I. MARKET ANALYSIS
A. Target Market - Who are the customers?
1. We will be selling primarily to (check all that
apply):
| Total Percent of Business | ||
| a. Private sector |
▒ |
% |
| b. Wholesalers |
▒ |
% |
| c. Retailers |
▒ |
% |
| d. Government |
▒ |
% |
| e. Other |
▒ |
% |
2. We will be targeting customers by:
a. Product line
We will target specific
lines _________________
b. Geographic area? Which areas? _________________
c. Sales? We will target sales of _________________
d. Industry? Our target industry is _________________
e.
Other?
_________________
3. How much will our selected market spend on our
type of product or service this coming year?
$_______________
B. Competition
1. Who are our competitors?
NAME _____________________________________
ADDRESS _____________________________________
_____________________________________
Years in business ___________________
Market share ___________________
Price/Strategy ___________________
Product/Service
Features
___________________
NAME ______________________________________
ADDRESS ______________________________________
______________________________________
Years in business ___________________
Market share ___________________
Price/Strategy ___________________
Product/Service
Features
___________________
2. How competitive is the market?
High ____________________
Medium ____________________
Low
____________________
3. List below your strengths and weaknesses compared to your competition (consider such areas as location, size of resources, reputation, services, personnel, etc.):
Strengths Weaknesses
1.________________________ 1._______________________
2.________________________ 2._______________________
3.________________________ 3._______________________
4.________________________ 4._______________________
C. Environment
1. The following are some important economic
factors that will affect our product (such as country growth, industry health,
economic trends, taxes,
rising energy prices, etc.):
______________________________________________________
______________________________________________________
______________________________________________________
2. The following are some important legal factors that will affect our market:
_____________________________________________________
_____________________________________________________
_____________________________________________________
3. The following are some important government factors:
______________________________________________________
______________________________________________________
______________________________________________________
4. The following are other environmental factors that will affect our market, but over which we have no control:
______________________________________________________
______________________________________________________
______________________________________________________
II. PRODUCT OR SERVICE ANALYSIS
A. Description
1. Describe here what the product/service is and what it does:
______________________________________________________
______________________________________________________
______________________________________________________
B. Comparison
1. What advantages does our product/service have over those of the competition (consider such things as unique features, patents, expertise, special training, etc.)?
______________________________________________________
______________________________________________________
______________________________________________________
2. What disadvantages does it have?
______________________________________________________
______________________________________________________
______________________________________________________
C. Some Considerations
1. Where will you get your materials and supplies?
______________________________________________________
2. List other considerations:
______________________________________________________
______________________________________________________
III. MARKETING STRATEGIES - MARKET MIX
A. Image
1. First, what kind of image do we want to have (such as cheap but good, or exclusiveness, or customer-oriented, or highest quality, or convenience, or speed, or ...)?
______________________________________________________
B. Features
1. List the features we will emphasize:
a.___________________________________________________
b.___________________________________________________
c.___________________________________________________
C. Pricing
1. We will be using the following pricing strategy:
a. Markup on cost ____ What % markup? ______
b. Suggested price ____
c. Competitive ____
d. Below competition ____
e. Premium price ____
f.
Other
____
2. Are our prices in line with our image?
YES___ NO___
3. Do our prices cover costs and leave a margin of profit?
YES___ NO___
D. Customer Services
1. List the customer services we provide:
a. ____________________________________________
b. ____________________________________________
c. ____________________________________________
2. These are our sales/credit terms:
a. _____________________________________________
b. _____________________________________________
c. _____________________________________________
3. The competition offers the following services:
a. ______________________________________________
b. ______________________________________________
c. ______________________________________________
E. Advertising/Promotion
1. These are the things we wish to say about the business:
______________________________________________________
______________________________________________________
______________________________________________________
2. We will use the following advertising/promotion sources:
1.
Television
________
2.
Radio
________
3.
Direct
mail
________
4.
Personal contacts ________
5. Trade
associations ________
6.
Newspaper
________
7.
Magazines
________
8.
Yellow
Pages
________
9.
Billboard
________
10.
Other___________ ________
3. The following are the reasons why we consider the media we have chosen to be the most effective:
_______________________________________________________
_______________________________________________________
_______________________________________________________