Marketing plan

 

I.       Executive Summary PRIVATE

         A one- to three-page synopsis of the plan providing highlights of the current situation, objectives, strategies, principal actions programs, and financial expectations.

        

II.      Situation Analysis

         Often called SWOT Analysis, (Strengths, Weaknesses, Opportunities and Threats), this section serves to help you understand your current business situation.  By looking at where you have been and where you are now, in terms of your resources and competition, you will be better able to determine where you are likely to be tomorrow.                

        

         The situation analysis consists of two parts: (1) an EXTERNAL analysis of the uncontrollable factors that affect business operations, and (2) an objective evaluation of your INTERNAL strengths and weaknesses.

 

         A.     Industry analysis

                  Every business is part of a larger industry that exists within a macro external environment. In this section it is important that you analyze the trends and characteristics of the environment that you compete in.

                  1.   Market

                        a.   Size, scope, and share of the market sales history of all producers and their market shares

                        b.   Market potential and major trends in supply and demand of this and related products

                  2.   Market activity

                        a.   Pricing history through all levels of distribution and reasons for principal fluctuations

                        b.   The distribution channels

                        c.   Selling policies and practices

                        d.   Advertising and promotion

                  3.   Sales, costs, and gross profits

                        a.   Sales history by grades, varieties; by sales district; by end user; by industry

                        b.   Cost history

                        c.   Profit history

                        d.   Changes in volume and profit rankings of product lines and items in a product line

                  4.   Technology -- Product and process improvements

                        We live in an era of rapid technological change. You must look at the developments within your industry that may make your product, service, or business obsolete, or even less competitive. How close are you to the cutting edge of technological advance? This will help you decide whether you need a short-term strategy or if you can be comfortable with a long-term strategy. In addition, you must look at all of the variable components of marketing to stay abreast of what’s happening. Look at your product, place/distribution, price and promotion when dealing with available and future technology.

                        a.   Rate (life cycle)

                        b.   Lead time required for design and development of a new product

                        c.   Market impact (primary versus selective demand)

                        d.   How interrelated are product and process?

                  5.   Market characteristics: Trends in

                        a.   Industry use patterns

                        b.   End-use patterns

                        c.   Frequency, quantity, and timing of purchase

                        d.   Buying procedures and practices

                        e.   Service

                  6.   Government and social

                        a.   Regulatory climate

                              Complying with federal, state, and local regulations can be costly. However, not complying with them can be fatal! You must know the regulations which affect your business and be prepared to adapt if necessary. What regulations and controls current exist? Are any pending political or legal actions likely to affect your product?

                        b.   Fiscal and monetary policy

                              The impact of economic conditions has a strong effect on the products and services that consumers purchase. You will want to be aware of the current situation within the area that you are competing. Factors which can affect your business include macroeconomic conditions such as inflation, unemployment, and interest rates. Further, you must look at the ability of your customer to buy your product or service in relation to gross, disposable, and discretionary components of his or her income.

                        c.   Consumerism

                        d.   Environmental impact

                        e.   Social/cultural

                              What are the characteristics of the general population and your particular customer segments in terms of population trends, cultural values, lifestyle and occupation changes, etc? Look for relevant situations which pose either an opportunity upon which to capitalize or a threat which may affect your marketing strategy if left unattended. For example, the maturing “baby boomers” who have higher incomes, are more convenience-oriented, and more health conscious. As well, there are a growing proportion of women and minorities in the workplace.

                  7.   Industry attractiveness analysis

                        a.   Market factors:

                              (1)  Size

                              (2)  Growth

                              (3)  Series (Cycle)

                              (4)  Seasonality

                        b.   Industry factors:

                              (1)  Capacity

                              (2)  New product entry prospects

                              (3)  Rivalry

                              (4)  Power of suppliers

                              (5)  Power of buyers

                              (6)  Threat of substitutes

                        c.   Environmental factors:

                              (1)  Social

                              (2)  Political

                              (3)  Demographic

                              (4)  Technological

                              (5)  Regulatory

         B.      Sales analysis

                  This section should be an intensive study to uncover problems hidden by aggregate numbers. For example, an overall sales increase of a product line may be hiding the fact that one particular product in that line is unprofitable.

                  1.   Market area performance versus company average

                  2.   Trends of sales, costs and profits by products

                  3.   Performance of distributors, end users, key customers

                  4.   Past versus current results by area, product, channel, and so on

         C.     Competitor analysis

                  In addition to the items in this formal outline, ask yourself questions like: how easily can potential customers substitute something else instead of using your product or service? How difficult is it for other to enter this market? Is there anything you can do to prevent new competitors from entering this market? What factors are barriers to your entering this market? What factors are barriers to others entering this market?

                  1.   For each major competitor and your own company ask:

                        a.   How does he measure and evaluate his results?

                        b.   How did he achieve the results and what factors helped or hurt him?

                        c.   What are his important strengths and liabilities and how are these likely to change?

                        d.   What is his future strategy likely to be?

                  2.   Thorough analysis requires:

                        a.   Exploration of past results

                        b.   Reconstruction of past strategy

                        c.   Evaluation of resources

                              (1)  Ability to conceive and design new products

                              (2)  Ability to produce or manufacture

                              (3)  Ability to market

                              (4)  Ability to finance

                              (5)  Ability to manage

                              (6)  Will to succeed in this business

                        d.   Comparative analysis of existing and anticipated future products

         D.     Customer analysis -- key questions to better understand your market

                  Knowledge of consumers is critical to developing successful marketing plans. In addition to answering the questions in this formal outline, you need to determine what your answers will be based on: primary or secondary sources of information, and how you will acquire that information (e. g., will you conduct your own research or hire an outside research firm?).

                  1.   Who:

                        a.   Who are your customers?

                        b.   How can they be classified?

                        c.   Which classification is most important to you and your competitors -- today and tomorrow?

                  2.   Why:

                        a.   Why do customers buy when, as much as, and the way they do?

                        b.   How involved and prolonged is the purchase decision?

                        c.   How many people are involved and at what level?

                        d.   What are the objectives of each person involved?

                        e.   Which objectives are most important?

                  3.   What does the product or service offer the customer . . .

                        a.   functionally?

                        b.   in terms of image or perception?

                  4.   What if . . .

                        a.   What would cause a change in customers’ objectives?

                        b.   What information will help anticipate these changes?

                  5.   So what?

                        a.   What are the implications of changes in customer behavior?

                        b.   What is the expected impact on you and your competitors?

                  6.   What then?

                        a.   How will this customer analysis improve your understanding of the total market, size, mix growth rate, and timing?

         E.      Planning assumptions

                  It is important to honestly articulate your assumptions since you must be prepared to answer questions like: How badly will the product’s market position be hurt if your assumptions turn out to be incorrect?

                  1.   Explicit statement of assumptions about the future

                  2.   Projections, predictions, and forecasts

         F.      Forecasts

                  1.   Industry

                  2.   Product

        

III     Situation Analysis - Internal

         A.     Resource capabilities

                  1.   Financial resources

                        What is the current scope of the business in terms of size, growth, and profitability?

                  2.   Human resources

                        Do the managers of this plan have special talents or abilities that provide some competitive advantage? Do you have sufficient and adequately training staff to meet the needs of your business at the present time? Will you need additional staff to implement this plan? Where and how will you get additional staff if required?

                  3.   Manufacturing/production resources

                        Do  you have the facilities and equipment necessary for increasing production? At what capacity do you presently operate? What impact will increased demand have?

                  4.   R & D resources

                        What is the effectiveness of your organization’s research and development effort? What can be done to modify these resources to suit the needs identified by this plan?

                 

IV.    Objectives

         This part of the plan spells out what the plan is expected to accomplish. Objectives should be stated for each target market.

         A.     Corporate objectives (if appropriate)

         B.      Divisional objectives (if appropriate)

         C.     Marketing objectives

                  1.   Quantity (sales, share, and so on)

                  2.   Direction

                  3.   Number

                  4.   Time frame

                  5.   Rationale

         D.     Program objectives

                  1.   Pricing

                  2.   Advertising/promotion

                  3.   Sales/distribution

                  4.   Product

                  5.   Service

 

V.     Marketing Strategy

         This part of the plan discusses how the objectives will be achieved, or how the plan will be implemented.

         A.     Strategic alternative(s)

         B.      Customer targets

         C.     Competitor targets

         D.     Core strategy

 

VI.    Marketing Programs

         This part of the plan focuses on the marketing mix considerations of product, place (distribution), price and promotion.

         A.     Pricing

         B.      Advertising/promotion

                  1.   Copy

                  2.   Media

                  3.   Trade versus consumer promotion

         C.     Sales/distribution

         D.     Product development

         E.      Service

         F.      Market research

 

VII.   Financial Documents

         In today’s business environment, the product or marketing manager must be knowledgeable about the financial dimensions of his or her job. In fact, in many ways this marketing plan can be seen as comparable to a start-up plan for a new business. In addition, in order to be part of the firm’s overall decision making, the product manager must understand the financial implications of his or her decisions.

         A.     Budgets

                  1.   Advertising/promotion

                  2.   Sales

                  3.   Research

                  4.   Product development

         B.      Pro forma statements

                  1.   Costs

                        a.   Dollar, unit

                        b.   Variable, fixed

                  2.   Revenues (forecasted)

                  3.   Profits

                        a.   Dollars, dollars per unit

                        b.   ROI

                        c.   Versus company average

        

VIII.  Monitors and Controls: Specific research information to be used

         This section of the plan specifies the type of marketing research or information needed to measure progress toward achieving the stated objectives. The kind of information collected often depends on the objectives.

         A.     Secondary data

                  1.   Sales reports

                  2.   Orders

                  3.   Informal sources

         B.      Primary data

                  1.   Sales records (Nielsen, IRI)

                  2.   Specialized consulting firms

                  3.   Customer panel

        

IX.    Contingency Plans and Other Miscellaneous Documents

         This section of the plan discusses both contingencies (what action should or will be taken if conditions and assumptions used in this plan change), and alternative strategies which were considered and then rejected.

         A.     Contingency plans

         B.      Alternative strategies considered

         C.     Miscellaneous

 

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