PRINCIPLES OF MARKETING

FINAL PAPER GUIDELINES

Prof. Jenny Malabrigo

Assume you will present your marketing plan to the CEO of the Company. You will be evaluated on the quality and
comprehensiveness of your marketing plan and your interesting sales presentation. Using the framework below, you need to:

Framework for Presentation

 Choose the name of your product. Be creative.
 Develop a slogan or tagline for the product
 Identify your target market. Consider the following:
 Demographics (age, gender, income, occupation)
 Psychographics (lifestyles, leisure time)
 Geographic (town, county, state, region, country, etc.)
 Consumer behaviors
 Explain your product strategies and decisions
 Packaging, product benefits, special features that will set this product apart from its competitors, etc.
 Explain your place strategies and decisions
 The Company has historically been the manufacturer and wholesaler (distributor). What is going to be
the distribution strategy to get this new product into the hands of consumers? (Think about practicality,
efficiency, and cost when considering the best distribution strategy).
 Explain your price strategies and decisions
 Demand-based, cost-based, competition-based, combination, etc.
 psychological pricing strategies
 Explain your promotion strategies and decisions
 What’s your message and how will you communicate it?
 How and in what format will you reach your customer?
 Print, broadcast, special events or sales promotions, etc.
 Describe any advertisements

Remember, the more defined your target market, the easier it will be to figure out how to reach them. All marketing
decisions should be made with the target market in mind.

Classroom Presentation: A fifteen-minute presentations of your findings: preferably using PowerPoint software.

Focus of Marketing Plan:

1. Your plan should address the business’ Target Market and the 4Ps. (Place, Product, Promotion, & Price)
2. Your plan should include some element of Market Research – whether it is primary or secondary. You should explain
what data was collected, how it was collected, its analysis and any conclusions/recommendations based on it.
3. Your plan should consist of specific marketing recommendations based on your plan that address Target Market, 4Ps,
and Market Research.
4. Length: Approximately 15 typed pages (double space) with well documented references and bibliography
5. Submission: Final paper is due the day you select for classroom presentation (March 10 or 17, 2018).

Points Criteria
Task Beginning = 0
Typed, structured, No report was submitted.
well written, Final report is
grammar, spelling unacceptable.
---Marketing Plan (O Points)
Content –Major Content is unacceptable or
sections (Target missing.
Market & 4Ps, Market (O Points)
Research)
---Marketing Plan &
Sales Presentation
Actual presentation/ Did not present to class or
Presentation of very poor communication
Content of presentation.
---Sales Presentation Enthusiasm and interest
level was absent from
presenters. Maintained
unacceptable level of eye
contact and voice volume.
Confidence was missing
from presentation.
(O Points)
Duration Less than 7 minutes
---Sales Presentation (O Points)
What is Marketing Research?
Developing = 60
Few parts of report are
structured or well written.
Many grammar and
spelling errors. Amateur
look. Doesn’t look very
professional.
(15 Points)
Few sections are
completely addressed in a
superior manner. Few
sections are organized &
well thought out.
(30 Points)
Communicated few aspects
of presentation to class.
Displayed little enthusiasm
during the presentation.
Maintained unacceptable
level of eye contact and
voice volume. Need to
develop confidence.
(15 Points)
7-10 minutes
(15 Points)
Focused = 80
Most parts of report are
structured or well written.
Few grammar and spelling
errors. Could’ve looked
more professional.
(20 Points)
Most sections are
completely addressed in a
superior manner. Most
sections are organized &
well thought out.
(40 Points)
Communicated some
aspects of presentation to
class. Displayed some
enthusiasm during the
presentation. Maintained
acceptable level of eye
contact and voice volume.
Fairly confident
presentation.
(20 Points)
Exemplary = 100 100
Report is typed, well 25
structured, well written,
with no grammar and
spelling errors. Very
professional look.
(25 Points)
All sections are completely 50
addressed in a superior
manner. All sections are
organized & well thought
out. Comprehensive report.
(50 Points)
Clearly communicated all 25
aspects of presentation to
class. Displayed enthusiasm
during the presentation.
Maintained exemplary eye
contact and voice volume.
Confident presentation.
Communicated content of
report effectively.
(25 Points)
10+ minutes (25 Points) 25

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It is the process of collecting, analyzing and interpreting data about problems related to the marketing of goods and
services. It is used to investigate markets and competition.

An organization must be able to analyze existing or potential customers. It would be very challenging to satisfy them if
you don’t know who they are, how they will use it, why they want it or what they want.

Every small business owner-manager must ask the following questions to devise effective marketing strategies:

 Who are my customers and potential customers?

 What kind of people are they?
 Where do they live?
 Can and will they buy?
 Am I offering the kinds of goods or services they want - at the best place, at the best time and in the right
amounts?
 Are my prices consistent with what buyers view as the product's value?
 Are my promotional programs working?
 What do customers think of my business?
 How does my business compare with my competitors?

Marketing research is not a perfect science. It deals with people and their constantly changing feelings and behaviors,
which are influenced by countless subjective factors. To conduct marketing research you must gather facts and
opinions in an orderly, objective way to find out what people want to buy, not just what you want to sell them.
Why do it?
It is impossible to sell products or services that customers do not want. Learning what customers want, and how to present it
attractively, drives the need for marketing research. Small business has an edge over larger concerns in this regard. Large
businesses must hire experts to study the mass market, while small-scale entrepreneurs are close to their customers and can learn
much more quickly about their buying habits. Small business owners have a sense their customers' needs from years of experience,
but this informal information may not be timely or relevant to the current market.

Marketing research focuses and organizes marketing information. It ensures that such information is timely and permits entrepreneurs
to:

 Reduce business risks

 Spot current and upcoming problems in the current market
 Identify sales opportunities
 Develop plans of action

How to do it
Without being aware of it, most business owners do market research every day. Analyzing returned items, asking former customers
why they've switched, and looking at competitor's prices are all examples of such research. Formal marketing research simply makes
this familiar process orderly. It provides a framework to organize market information.
Market Research - The Process

Step One – Define Marketing Problems and Opportunities

Market research, like other components of marketing such as advertising, can be quite simple or very complex. You might conduct
simple market research such as including a questionnaire in your customer bills to gather demographic information about your
customers. On the more complex side, you might engage a professional market research firm to conduct primary research to aid you in
developing a marketing strategy to launch a new product.

Regardless of the simplicity or complexity of your marketing research project, you'll benefit by reviewing the following seven steps in the
market research process.

Step One: Define Marketing Problems and Opportunities

The market research process begins with identifying and defining the problems and opportunities that exist for your business, such as:
 Launching a new product or service.
 Low awareness of your company and its products or services.
 Low utilization of your company's products or services. (The market is familiar with your company, but still is not doing
business with you.)
 A poor company image and reputation.
 Problems with distribution, your goods and services are not reaching the buying public in a timely manner.

Step Two: Set Objectives, Budget and Timetables

Objective: With a marketing problem or opportunity defined, the next step is to set objectives for your market research operations. Your
objective might be to explore the nature of a problem so you may further define it. Or perhaps it is to determine how many people will
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buy your product packaged in a certain way and offered at a certain price. Your objective might even be to test possible cause and
effect relationships. For example, if you lower your price by 10 percent, what increased sales volume should you expect? What impact
will this strategy have on your profit?

Budget: How much money are you willing to invest in your market research? How much can you afford? Your market research budget
is a portion of your overall marketing budget. A method popular with small business owners to establish a marketing budget is to
allocate a small percentage of gross sales for the most recent year. This usually amounts to about two percent for an existing business.
However, if you are planning on launching a new product or business, you may want to increase your budget figure, to as much as 10
percent of your expected gross sales. Other methods used by small businesses include analyzing and estimating the competition's
budget, and calculating your cost of marketing per sale.

Timetables: Prepare a detailed, realistic time frame to complete all steps of the market research process. If your business operates in
cycles, establish target dates that will allow the best accessibility to your market. For example, a holiday greeting card business may
want to conduct research before or around the holiday season buying period, when their customers are most likely to be thinking about
their purchases.

Step Three: Select Research Types, Methods and Techniques

There are two types of research: primary research or original information gathered for a specific purpose and secondary research or
information that already exists somewhere. Both types of research have a number of activities and methods of conducting associated
with them. Secondary research is usually faster and less expensive to obtain that primary research. Gathering secondary research
may be as simple as making a trip to your local library or business information center or browsing the Internet.

Secondary Research
Secondary research exploits published sources like surveys, books, and magazines, applying or rearranging the information in them to
bear on the problem or opportunity at hand. A tire sales business owner might guess that present retail sales of tires are strongly
correlated with sales of new cars three years ago. To test this idea, it's easy to compare new car sales records with replacement tire
sales three years later. Done over a range of recent years, this should prove or disprove the hypothesis and help marketing efforts
tremendously.

Primary Research
Primary research can be as simple as asking customers or suppliers how they feel about a business or as complex as surveys
conducted by professional marketing research firms. Direct mail questionnaires, telephone surveys, experiments, panel studies, test
marketing, and behavior observation are all examples of primary research.

Step Four: Design Research Instruments

There are many research instrument s that are used to collect data. Within each instrument, there are advantages and disadvantages.
The design of the instrument will also impact the reliability of the collected data.
Method of Data Collection Advantage Disadvantages
s
Telephone Survey
Personal Interview
Focus Group
Paper Survey/Questionnaire
Online Surveys (discounts)

Step Five: Collect Data

To help you obtain clear, unbiased and reliable results, collect the data under the direction of experienced researchers. Before
beginning the collection of data, it is important to train, educate and supervise your research staff. An untrained staff person conducting
primary research will lead to interviewer bias.

Stick to the objectives and rules associated with the methods and techniques you have set in Step Two and Step Three. Try to be as
scientific as possible in gathering your information

Step Six: Organize and Analyze Data

Once your data has been collected, it needs to be "cleaned." Cleaning research data involves editing, coding and the tabulating results.
To make this step easier, start with a simply designed research instrument or questionnaire.

Some helpful tips for organizing and analyzing your data are listed below.
 Look for relevant data that focuses on your immediate market needs.
 Rely on subjective information only as support for more general findings of objective research.
 Analyze for consistency; compare the results of different methods of your data collection. For example, are the market
demographics provided to you from the local media outlet consistent with your survey results?
 Quantify your results; look for common opinions that may be counted together.
 Read between the lines. For example, combine U.S. Census Bureau statistics on median income levels for a given location
and the number of homeowners vs. renters in the area

Step Seven: Present and Use Marketing Research Findings

Once marketing information about your target market, competition and environment is collected and analyzed, present it in an
organized manner to the decision makers of the business. For example, you may want to report your findings in the market analysis
section of your business plan. Also, you may want to familiarize your sales and marketing departments with the data or conduct a
company-wide informational training seminar using the information. In summary, the resulting data was created to help guide your
business decisions, so it needs to be readily accessible to the decision makers.

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 Developing Marketing Plans
Marketing Plan – Documented roadmap that includes objectives/goals, strategies, budgets, and how you
plan to meet your marketing objectives/goals. You can refer to it as a roadmap, blueprint or game plan.

Marketing objectives (goals) should:

 be clear
 be measurable
 Have a stated time frame for achievement.

Examples of marketing objectives follow:

 Increase product awareness among the target audience by 30 percent in one year.
 Inform target audience about features and benefits of our product and its competitive advantage,
leading to a 10 percent increase in sales in one year.
 Decrease or remove potential customers' resistance to buying our product, leading to a 20 percent
increase in sales in six months or less.

If you have multiple objectives, make sure they are consistent and not in conflict with each other. Also, your
marketing strategy (based on 4Ps) and budget should support your marketing objectives.

Keep the following question in mind as you evaluate your marketing plan on an ongoing basis:

 Do you have the resources (human, financial, technological) necessary to accomplish your objectives?

Your marketing strategy should include information about:

 Product - your product(s)and services

 Price - what you'll charge customers for products and services
 Place (distribution) - how you will bring your product(s) together with your customers.
 Promotion - how you will promote or create awareness of your product/service in the marketplace

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 Sample Video Store Marketing Plan: Independent Choice Flicks

Introduction:
Independent Choice Flicks (ICF) is an alternative video rental store located in Ann Arbor; MI. ICF will rent movies not
often available from the larger chains: film festival movies, independent releases, foreign films and other "arts" films. Ann
Arbor clearly has the market for these types of films, as evidenced by the general demographics (liberal, educated,
college town) and the popularity of the Monarch Arts Cinema, a first run movie theatre concentrating on this same genre
of movies. This market has been ignored by the dominant stores in Ann Arbor. They may have a few films that fit these
descriptions, but in general they are far and few between. It is too difficult for the large corporations to market to this
specific segment, particularly with their current business model which is putting a store in all cities that are very similar in
feel, with a concentration on large scale commercial releases.

SWOT Analysis (of Current Situation)

The following SWOT analysis captures the key strengths and weaknesses within the company, and describes
opportunities and threats that ICF faces.

Strengths
 Strong relationships with distributors.
 Excellent staff who are well informed and customer attentive.
 A centrally-located store front.
 An unmatched selection.
Weaknesses
 The struggle to raise brand awareness.
 A limited budget to acquire customers.
 Not having the buying power that the giants have, increasing acquisition costs.
Opportunities
 A growing rift in the market between artsy and commercial films and the corresponding viewers.
 The opportunity to decrease customer acquisition costs over time as more customers are acquired through
referrals.
 The ability to leverage the fact that the "giants" ignore the majority of the alternative/intellectual population
segment.
Threats
 Competition from the giants if they decide to change their course and address the alternative crowd.
 A significant increase in movie theatre technology that makes the in-the-movie experience more difficult to
replicate at home.
 Increased popularity of independent and foreign films, ensuring that the giants carry these titles.

Proposed Target Market

ICF is focusing on these two groups because they are underserved in Ann Arbor. Currently, there are two large corporate
rental chains, Hollywood Video and Blockbuster that hold the majority of the market. In order for them to be successful,
they must concentrate on the middle of the market, the mean. This allows them to use economies of scale to drive down
the costs of operating a movie rental business. While this works for the general population, it does not address the fringes
at all. ICF is addressing the fringe movie rental market.

Geographics
 The immediate geographic target is the city of Ann Arbor, Michigan with a population of 123,000.
 A 15 mile radius is in need of ICF's services.
 The total targeted population is estimated at 64,500.

Demographics
 Male and female.
 Ages 18-55. This age range draws off a combination of university students and locals within the community.

ICF's customers can be divided into two general groups that are differentiated by age, over 30 and under 30.
 Under 30: This market segment has a diverse interest that certainly overlaps with the over 30 crowd. The under
30 movies might have more of a concentration on action, violence, drugs, sex, etc. This is not to say that the
movies are about these subjects solely, it is just that these topics might relate better to someone under 30 than
over 30.
 Over 30: This market segment has a bit more mature tastes, the humor may be more sophisticated, they are
more likely to enjoy a foreign film relative to the under 30 group. Generally, the topics of the movies will reflect
issues that this group is most used to or closer to their experiences.

 Have (or are getting) a college education and some with graduate degrees.
 An income over $40,000 (except the students who earn far less).

Psychographics
 Value and participate in cultural activities.
 Watches at least one movie per week.
 Reads at least one book per month
 Contributes at least $100 towards social causes per year
 Volunteers at least 2-3 hours per month towards civic activities

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Behavior Factors
 Enjoy alternative, or less commercial, movie options.
 Prefer to be stimulated intellectually when viewing their films.

Marketing Objectives
 Increase repeat customers by 7% each quarter.
 Decrease customer acquisition costs by 8% per year.
 Increase brand equity, measured by the number of new customers that are already familiar with ICF and their
niche before arrival into the store.

Proposed Marketing Mix

ICF's marketing mix is comprised of the following approaches to Price, Place, Product and Promotion.

 Price: ICF's pricing scheme will be based on maintaining a competitive price relative to the giants. Competition
based pricing will be used in conjunction with odd-even pricing to suggest a bargain. In addition, the store will
offer deep discounts for midweek rentals to increase demand during these times. There will also be promotional
discounts based on specific movies. Indicate pricing structure HERE for video rentals.

 Place: ICF has established a relationship with three different movie vendors. This was done to reduce the
possibility of being held hostage by one firm in case a vendor wants to renegotiate its terms for movies. In the
future, ICF will evaluate whether it wants to exclusively deal with one vendor and attempt to negotiate more
favorable terms. All of the services will be distributed through ICF's storefront on a walk-in basis. Possible future
enhancement would be to add home delivery as well as Internet orders.

 Product: ICF has decided to purchase VHS and DVDs for genre specific movies that are aligned with its
target market focusing on cultural awareness, art and intellectual stimulation. We offer extended night-
time drop box for movie returns, and advantages of being a member of the store in which members
receive special offers and promotions.

 Promotion: The most successful advertising will be advertisements in the local theatre and weekly art guides as
well as strategic alliances with select restaurants. Obsessive customer is the mantra. This will be accomplished
regardless of the short-term cost, recognizing a happy customer ensures long-term profits. News releases from
major newspapers in the Ann Arbor area are planned to create public awareness and buzz. We are contemplating
a future movie night theme and attempting to develop strategic partnerships with secondary schools and
universities in the Ann Arbor area.

Marketing Research
During the initial phases of the marketing plan development, several focus groups were held to provide ICF with insight
into customer preferences. These focus groups provided ICF with a wealth of information regarding the attributes of the
most prized customers, and insight into their decision-making processes.
An additional source of market research is a survey that was placed at the Monarch Arts Cinema capturing valuable
feedback regarding questions of video rentals. These surveys were completed by customers at the theatre and were
developed in part by a mathematics graduate student at the University of Michigan. Leveraging the graduate student's
help was instrumental in developing a statistically significant survey instrument.
Cite facts from Market Research process HERE.

Marketing Strategy

Summary
ICF's marketing strategy will be based on generating visibility of ICF with its targeted population segment. This will be
achieved through a multi-faceted advertising campaign. The campaign will utilize advertisements in a local
art/entertainment weekly guide, advertisements at the local artsy movie theatre, and promotional activities with a couple of
local restaurants that have similar demographics.
The marketing strategy will first seek to create customer awareness regarding the services offered, develop the customer
base, and work toward building customer loyalty and referrals.
The message that ICF will seek to communicate is that they offer a quality, independent, non-commercial alternative to
the norm of Blockbuster and Hollywood video. This message will be communicated through a variety of methods. The first
is an advertising campaign in the Ann Arbor Weekly, an entertainment guide that serves the alternative crowd of Ann
Arbor. This weekly has similar customer demographics as ICF so it will be well targeted.
The second method of communication will be with advertisements at the Monarch Arts Cinema, a local theatre that plays
the same genre of films as ICF. The advertisements will be in the form of visual posters in the cinema as well as
advertising within the trailers of the films.
The last method of communication will take the form of strategic relationships with various restaurants that have similar
customers. The alliances will often include some sort of promotion that combines the services of both the restaurant and
ICF.