One of the most important aspects of starting and running your corporation is first developing a comprehensive marketing plan. Many first-time business owners think placing an ad, running a television commercial and designing a glossy brochure will automatically bring in customers. However, the "build it and they will come" aspect doesn't work in the business world; it takes careful planning and a comprehensive understanding of the marketplace in order to develop a business strategy that will ensure success.
What is a Marketing Plan?
A well-written marketing plan will outline the basics of your business, its goals and how it will achieve its goals through specific strategies and techniques. The plan not only identifies potential customers and specific ways to reach those customers; it outlines your budget, researches your competition, and develops adequate advertising and promotional activities.
Each section of a marketing plan should detail specific ways to achieve your corporation's objectives. Because of this, marketing plans must be reviewed annually and modified accordingly.
Below are the top ten sections of a corporation's marketing plan, although specific sections may be customized for specific corporations' needs:
1. The Executive Summary:
The first section of your marketing plan is the Executive Summary, which summarizes the key elements to your overall marketing plan. This includes a description of your company, including a brief description of the products and/or services, the customer market, your competition, and the company's financial projections. This section should also supply readers with your company's mission statement and a listing of the management team.
Although this is the first section of the plan, it is many times the last section to write in that it summarizes the entire plan. If you have trouble brainstorming your executive summary, review your marketing plan after it's completed and summarize each section briefly. The executive summary should be between one and two pages and, because it's the first part your reader will see, should describe a positive outlook of your company.
2. Your Corporation's Goals:
This section should briefly discuss your marketing objectives. They should be clear, measurable and attainable within a specific time period (one year is usually the most effective time period for a marketing plan). If you have more than one goal, make sure they compliment each other, and make sure that components of your plan support your marketing goals.
3. Market and Customer Review:
The next section of your marketing plan should review your target market and trends in the marketplace. Examining the primary and secondary target audiences and their needs is an important aspect of a successful corporation. In addition, researching your specific industry's marketing needs will help you stay competitive within the marketplace.
By analyzing market research, marketplace data, and trends, you will be able to adjust your marketing objectives accordingly. You should also analyze the demographics of your target market, including the age, sex, profession, income, and education of your customers and potential customers. Where do your customers shop? What qualities do your customers value most about your product or service? What qualities do they least like about your product or service? Are there prospective customers who haven't heard about your product?
This section should be reviewed periodically, as you will need to determine who your potential customers are, their needs, and the demand for your product in your market area. Some questions to answer through research include:
- Who are your potential customers?
- Where are they located (this is especially important if you're selling your products on-line).
- Where is there a need for the product and/or service you are selling?
- What is the size of your industry?
- What are the local, national and (if appropriate) international trends of your industry?
- Are your prices consistent with the marketplace?
4. Competition Overview:
Although the above section details the industry as a whole, you also need to specify your competition in this section of your marketing plan. Who are your competitors and how do you differ from them? How do your promotion methods differ from theirs? Is there a specific demand for your product or service, based on other competitors' successes? What are the similarities and dissimilarities between your product or service and your competitors'? By using your market research data, you can identify your direct and indirect competitors, their strengths and weaknesses, and how you will compete against them. Examine what market segments your competitors serve, their advertising and promotional strategies, their pricing strategies, and what customers purchase their products and/or services.
You can investigate your competitors through the Internet, newspapers, magazines, or by simply visiting them in your area. You can also talk to your own vendors who may also service your competitors or even ask your own customers what other companies they solicit.
5. Product/Services Review:
Now that you understand your customers and your competition, you can describe the benefits of your product and/or service to those customers, and how competitive your products/services are versus your competition's. This section should not only describe what your products and/or services are; they should emphasize the unique features and selling points of your products, and how your customers will benefit from using the products and/or services you are offering. Some questions you can use to summarize this section include:
- What are the unique features of your product or service?
- What are the physical attributes of your product or service?
- How do your products or services differ from your competitors' products or services?
- How do your products or services benefit your customers?
6. Your Pricing Strategy:
After you've described what your products and services are, you can them describe your pricing strategy. This is where you'll determine how you will price your product or service, and how your price will compare to your competition. How will you price your products or services? Will it be below or above the competition? Will you factor in internal costs, such as materials, labor, overhead, etc.? You should list your pricing techniques and give a brief description of each technique. In addition, you will need to calculate your costs to produce your product or service, estimate the benefits your customers receive from your product or service, and compare your competitions' prices.
7. Management Plan:
This section defines the important characteristics about your corporation, including the ownership structure, the management team and the staff. Because you are running a corporation, the internal and external structure of the corporation will be detailed in this section, including the owners, the board of directors, managers, staffing requirements, etc.
8. Operating Plan:
A description of your business location and the advantages and disadvantages of the location are included in this section. In addition, equipment, inventory requirements, suppliers and vendors needed, manufacturers used, and other operating details will be included. Explain, in detail, who your suppliers and vendors are, their prices, terms and conditions, and any alternative arrangements you have if something happens to these suppliers and/or vendors.
Your day-to-day operations and your sales and distribution strategy will also be detailed in this section. How are you going to get your products or services to your customers? This section outlines just this. For example, will you use the Web, direct mail, outside sales representatives, manufacturers, or simply use retail sales? Once you will decide if you'll use one, two or all of these outlets, this section will detail the costs associated with this distribution, the distribution methods, and other integral parts of selling your products.
9. Advertising and Promotional Plan:
This section of the marketing plan will describe how you are going to promote your products and services. This goes back to your target audience - which type of media will be the best approach to reaching them? In addition, what are the costs allocated for advertising and promotions, including any printing and distribution of materials? List the advertising media you will use and estimate the cost for each medium. Will you use newspapers, magazines, billboards, the Internet, Yellow Pages, radio or television? How about direct mail or telemarketing? Is there money in the budget for public relations activities, such as press releases or community sponsorships? Are there any possible future marketing methods to attract new customers?
After answering these important questions, you can then decide upon what percentage of your annual advertising budget should be invested in each medium. When budgeting this section, first develop your media budget; then you can include the cost of advertising and the projected budget this advertising will bring in. In addition, this section should also discuss any "grassroots" advertising, including coupons, free giveaways, product launches, community involvement, and product demonstrations.
A budget for marketing materials will also be listed in this section, including business cards, brochures, direct mail, a Web site, and even trade show appearances.
Once you compile all of the above information, you will also need to constantly evaluate and review your sales and expenses. But, if you have a well-written, comprehensive marketing plan that describes how you plan to attract and retain customers, how you will compete, and what resources you have available, you will be able to successfully evaluate how you will achieve your business goals.