Entrepreneurship and Small

Business Management

Chapter 7
Developing the Right Marketing Mix
and Plan
 Ch. 7 Performance Objectives
 Combine the four Ps—product, price, place,
and promotion—into a marketing mix.
 Choose the attributes of your product or
service.
 Determine the mix of promotion to use for
your business.
 Find a way to add the fifth P, philanthropy,
to your business.
Entrepreneurship and Small Business Management, 1/e © 2012 Pearson Education, Upper Saddle River, NJ 07458.
By Steve Mariotti and Caroline Glackin All Rights Reserved.
2
 Ch. 7 Performance Objectives
(continued)
 Understand the importance of a
marketing plan.

 Identify the critical components of a

marketing plan.

 Use breakeven analysis to evaluate

your marketing plan.
Entrepreneurship and Small Business Management, 1/e © 2012 Pearson Education, Upper Saddle River, NJ 07458.
By Steve Mariotti and Caroline Glackin All Rights Reserved.
3
 Marketing Mix: The Four Ps
 Product—What are you selling?
 Price—What does the price “say” about
your product?
 Place—What is the best location for
your business?
 Promotion—How will you advertise and
publicize your product?

Entrepreneurship and Small Business Management, 1/e © 2012 Pearson Education, Upper Saddle River, NJ 07458.
By Steve Mariotti and Caroline Glackin All Rights Reserved.
4
 Create Your Product Concept
 Products are defined by:
 Physical attributes
 Performance characteristics
 Pricing
 Branding
 Delivery
 Key to successful branding: focus on
the product’s primary benefit

Entrepreneurship and Small Business Management, 1/e © 2012 Pearson Education, Upper Saddle River, NJ 07458.
By Steve Mariotti and Caroline Glackin All Rights Reserved.
5
 Establish Your Brand
 Choose an easy-to-remember name
that describes your business.
 Design a logo that symbolizes your
business.
 Develop a good reputation.
 Create a brand “personality” and
communicate it to your target market.

Entrepreneurship and Small Business Management, 1/e © 2012 Pearson Education, Upper Saddle River, NJ 07458.
By Steve Mariotti and Caroline Glackin All Rights Reserved.
6
 Build Your Brand’s Reputation
 Provide a high-quality product/service.
 Maintain high ethical standards.
 Define the product/service clearly.
 Treat employees well.
 Make ads positive and informative.
 Associate the company with a charity.
 Be involved in the community.
Entrepreneurship and Small Business Management, 1/e © 2012 Pearson Education, Upper Saddle River, NJ 07458.
By Steve Mariotti and Caroline Glackin All Rights Reserved.
7
 Price Considerations
 Simply undercutting competitors’
prices will not necessarily win you
the largest market share.

 Consider the psychology of pricing:

consumers tend to infer things about
a product/service based on its price.

Entrepreneurship and Small Business Management, 1/e © 2012 Pearson Education, Upper Saddle River, NJ 07458.
By Steve Mariotti and Caroline Glackin All Rights Reserved.
8
 Place
 The type of business affects the
location that works best.
 Who are your customers?
 Where do they shop?

 Goal: Find a location affordable for you,

yet also convenient for customers.

Entrepreneurship and Small Business Management, 1/e © 2012 Pearson Education, Upper Saddle River, NJ 07458.
By Steve Mariotti and Caroline Glackin All Rights Reserved.
9
 Promotion
 Promotion—use of advertising and
publicity to get your marketing
message to your customers.
 Advertising—purchased promotion
(billboards, TV ads, magazine ads, etc.)
 Publicity—free mention of a company,
person, or product/service in the media

Entrepreneurship and Small Business Management, 1/e © 2012 Pearson Education, Upper Saddle River, NJ 07458.
By Steve Mariotti and Caroline Glackin All Rights Reserved.
10
 Promotion Methods
 Advertising specialties  Networking
 Banner ads  Newsletters
 Billboards  Print media
 Blogs  Promotional clothing
 Broadcast media  Public speaking
 Brochures  Samples/demos
 Business cards  Special events
 Catalogs  Sponsorships
 Coupons  Telemarketing
 Direct mail  Toll-free numbers
 Directories  Web sites
 Flyers
Entrepreneurship and Small Business Management, 1/e © 2012 Pearson Education, Upper Saddle River, NJ 07458.
By Steve Mariotti and Caroline Glackin All Rights Reserved.
11
 Philanthropy: The Fifth P
 Philanthropy—a concern for human
and social welfare, expressed by giving
money through charities/foundations
 Foundation—not-for-profit organization
that manages funds donated to help
people and social causes
 Philanthropy creates goodwill—
favorable reputation, name recognition,
and positive customer relations
Entrepreneurship and Small Business Management, 1/e © 2012 Pearson Education, Upper Saddle River, NJ 07458.
By Steve Mariotti and Caroline Glackin All Rights Reserved.
12
 Cause-Related Marketing
 Inspired by a commitment to a social,
environmental, or political cause
 Simple way to work philanthropy into
your business
 Examples:
 Donate fixed % of revenue to charity
 Donate products/services
 Encourage employees to volunteer
Entrepreneurship and Small Business Management, 1/e © 2012 Pearson Education, Upper Saddle River, NJ 07458.
By Steve Mariotti and Caroline Glackin All Rights Reserved.
13
 Roles of a Marketing Plan
 Convince skeptical investors that your
plan has merit.
 Use and disclose market studies.
 Identify the target market.
 Evaluate the competition.
 Demonstrate the pricing strategy.
 Detail the advertising plan.
Entrepreneurship and Small Business Management, 1/e © 2012 Pearson Education, Upper Saddle River, NJ 07458.
By Steve Mariotti and Caroline Glackin All Rights Reserved.
14
 Marketing Plan Components

Components Stand-Alone Bus. Plan

Plan Section
Opportunity Analysis: X
• Industry Analysis X
• SWOT Analysis X
• Environmental Analysis X
• Competitive Analysis X

Entrepreneurship and Small Business Management, 1/e © 2012 Pearson Education, Upper Saddle River, NJ 07458.
By Steve Mariotti and Caroline Glackin All Rights Reserved.
15
 Marketing Plan Components
Components Stand-Alone Bus. Plan
Plan Section
Marketing Analysis: X X
• Overall Market and Target X X
• Goals and Objectives X X
• Marketing Strategy X X
Product/Service X X
Pricing Strategy X X
Promotion Strategy/Plan X X
Place/Distribution X X
Philanthropic Plan X X

Entrepreneurship and Small Business Management, 1/e © 2012 Pearson Education, Upper Saddle River, NJ 07458.
By Steve Mariotti and Caroline Glackin All Rights Reserved.
16
 Marketing Plan Components
Components Stand-Alone Bus. Plan
Plan Section
Marketing Analysis (continued): X X
• Future and Contingency Plans X X
Financial Projections X
Implementation Time Line X
Measurement X
Supplemental Materials X

Entrepreneurship and Small Business Management, 1/e © 2012 Pearson Education, Upper Saddle River, NJ 07458.
By Steve Mariotti and Caroline Glackin All Rights Reserved.
17
 Can You Afford Your
Marketing Plan?
 Marketing is part of your business’s fixed
costs and should not be budgeted as a
percent of sales.

 Calculate breakeven units to determine if

the business can cover marketing costs with
the number of units you expect to sell.
 Breakeven units = Fixed cost (per month or
per year) divided by gross profit per unit

Entrepreneurship and Small Business Management, 1/e © 2012 Pearson Education, Upper Saddle River, NJ 07458.
By Steve Mariotti and Caroline Glackin All Rights Reserved.
18