Chapter 8

Marketing Plan
 Warren G. Jackson, Circulation Expert,
LTD.
Some experts argue that organizing
and launching a but of busines is the
easiest part of getting started, while
sustaining the business is the most
difficult and challenging part. But the
real problems relate to marketing issue
are, identifying the customers, defining the
right product or service to meet customer
needs, pricing, distribution and promotion.
 Industry Analysis
•Prior to the preparation of the marketing plan the
entrepreneur will need to complete the industry
analysis section of the business plan.
•The primary focus is to provide sufficient
knowledge of the environment (national and local
market) that can affect marketing strategy decision
making.
•It begins with the broadest-based assessment of
environmental and industry trends.
 Competitor Analysis
•The entrepreneur should begin this step
by first documenting the current strategy
of each primary competitor.
•The information on competitors can be
gathered initially by using as much public
information as possible and then
complementing this with a marketing
research project.
 Marketing Research for the
new
• Information for venture
developing the marketing plan
may necessitate conducting some marketing
research.
• Marketing research involves the gathering of
data in order to determine such information as
who will buy the product or service, what is
the size of the potential market, what price
should be charged, what is the most
appropriate distribution channel, and what is
the most effective promotion strategy to
inform and reach potential customers
Steps in Marketing Research
1. Defining the purpose or objective
2. Gathering data from Secondary
Sources
3. Gathering information from primary
sources
4. Analyzing and interpreting the
results.
Step 1 – Defining the Purpose
or Objective
• One objective would be to ask people what they
think of the product or service and whether they
would by it and to collect some background
demographics and attitudes of these individual.
• Other objective may determined by:
1. How much would potential customers be willing to
pay for the product or service?
2. Where would potential customers prefer to
purchase the product or service?
3. Where would the customer expect to hear about
or learn about such a product or service?
Step2 – Gathering data from
secondary sources
• There are many secondary sources that
may be used to address the specific
objectives.
• Trade magazines, newspaper articles,
libraries, government agencies, and
the internet can provide much
information on the industry market
and competitors.
Step 3 – Gathering information
from primary sources
• Gathering primary data involves data collection
procedure – such as observation, networking,
interviewing, focus groups or experimentation – and
usually a data collection instrument, such as
questionaire.
Observation – the entrepreneur might observe potential
customer and record some aspect of their buying
behavior.
Networking – Is more of informal method to gather
primary data from experts in the field, can also be a
valuable low-cost method to learn about the market
place.
Interviews or surveying – is the most common
approach used to gather market information. It may
be conducted in person, telephone, through the
mail, or online, an approach growing in popularity,
particularly for firms with an existing customer base.
Questionnaire or data collection instrument, used by
the entrepreneur should include questions
specifically designed to fulfill one or more of the
objectives of entrepreneur.
Focus groups – is a sample of 10 to 12 potential
customers who are invited to participate in a
discussion relating to the entrepreneur’s research
objective.
Step 4 – Analyzing and
interpreting the Results
• the result should be evaluated and
interpreted in response to the research
objectives that were specified in the first step
of the research process.
• Summarizing the answers to questions will
give some preliminary insights.
• Then the data can be cross-tabulated in order
to provide more focused results.
 Understanding the Marketing
Plan
•Once the entrepreneur has gathered all
the necessary information, he or she can
sit down to prepare the marketing plan.
•The marketing plan represents a
significant element in the business plan for
a new venture.
•It establishes how the entrepreneur will
effectively compete and operate in the
marketplace and thus meet the business
goals and objectives of the new venture.
• The marketing plan like any other type of
plan, may be compared to a road map used
to guide a traveler.
• It is designed to provide answers to three
basic questions:
1. Where have we been?
2. Where do we want to go (in the short-
term)?
3. How do we get there?
Characteristics of Marketing
Plan
• It should provide a strategy for accomplishing the company
mission or goal
• It should be based on facts and valid assumptions.
• An appropriate organization must be described to implement
the marketing plan
• It should provide continuity to that each annual marketing
plan can build on it
• It should be simple and short
• The success of the plan may depend on its flexibility
• It should specify performance criteria that will monitored
controlled.
Marketing plan – Written statement of
marketing objectives, strategies, and
activities to be followed in business plan.

Marketing system – interacting internal and

external factors that affect venture’s ability to
provide goods and services to meet customer
needs.
Some of the Major Internal
Variables

1. Financial resources
2. Management team
3. Suppliers
4. Company mission
 Financial Resources
Any marketing plan or strategy
should consider the availability
of financial resources as well
as the amount of funds needed
to meet the goals and
objectives stated in the plan.
 Management Team
It is extremely important in
any organization to make
appropriate assignments of
responsibility for the
implementation of the
marketing plan.
 Suppliers
The suppliers used are
generally based on a
number of factors such
as price, delivery time,
quality, and management
assistance.
 Company Mission
•Every new venture should define the
nature of its business.
•This statement helps to define the
company’s mission and basically
describes the nature of the business
and what the entrepreneur hopes to
accomplish with that business.
 The Marketing Mix
The above environmental variables will
provide much important information in
deciding what will be the most effective
marketing strategy to be outlined in the
marketing plan.
The four important marketing variables:
1. Product
2. Pricing
3. Distribution
4. promotion
Steps in Preparing the
Marketing Plan
1. Defining the business situation
2. Defining the target market
3. Considering strength and weakeness
4. Establishing goals and objectives
5. Defining marketing strategy and action programs
6. Marketing strategy: consumer vs business-to-
business markets
7. Budgeting the marketing strategy
8. Implementation of the marketing plan
9. Monitoring the progress of marketing plan.
 Defining the Business
Situation
• Situation analysis - describes
past and present business
achievements of new venture.
• The entrepreneur should
provide a review of past
performance of the product
and the company.
 Defining the Target
Market/Opportunities and Threats
• Target market - Specific group of
potential costumers toward which
venture aims its marketing plan.
• Either from the industry analysis
or from the marketing research
done, the entrepreneur should
have a good idea of who the
costumer or target market will be.
 Market Segmentation
• Is the process of dividing the
market into small
homogeneous groups.
• Market segmentation allows
the entrepreneur to more
effectively respond to the
needs of more homogeneous
costumer.
 Considering Strengths and
Weaknesses
• It is important for the entrepreneur to
consider the strength and weaknesses
in the target market.
• Weakness could relate to the venture’s
inability to gain complete credibility in
the town – given such widespread
concern regarding the abduction and
molestation of children.
 Establishing Goals and
Objectives
• Marketing goals and objectives –
statements of level of performance
desired by new venture.
• Before any marketing strategy
decisions can be outlined, the
entrepreneur must establish
realistic and specific goals and
objectives.
• These marketing goals and
objectives respond to the
question: “Where do we
want to go?” and should
specify things such as
market share, profits, sales,
market penetration, number
of distributors, awareness
level, and etc.
Defining Marketing Strategy and Action
Program
Marketing strategy and action plan – specific
activities outlined to meet the venture’s
business plan goals and objectives

Some possible decisions that might be made

for each variable are :
1. Product or service
2. Pricing
3. Mark-ups or margins.
4. Distribution
5. Promotion
 Product or Service
This elements of the marketing
mix indicates a description of
the product or service to be
marketed in the new venture.
This product or service or
service definition may consider
more than the physical
characteristics.
 Pricing
Prior to setting the price, the
entrepreneur, in the majority of situations,
will need to consider three important
elements:
1. costs,
2. margins
3. competition.
a. Costs
•One of the important initial
considerations in any pricing decision is
to ascertain the costs directly related to
the product or service.
•For a manufacturer this would involve
determining the material and labor costs
inherent in the production of the product.
•In service venture’s costs relate entirely
to labor and overhead expenses.
b. Markups or margins
In any industries, such as
jewelry, beauty supplies,
furniture, and clothing, the
retailers of the product use
a standard markup to price
goods in their stores.
c. Competition
When products cannot be
easily differentiated, the
entrepreneur is force to
charge the same price as
the competition.
d. Distribution
It provides utility to the
consumer; that is, it makes
a product convenient to
purchase when it is needed.
This variable must also be
consistent with other
marketing mix variables.
e. Promotion
It is usually necessary for
the entrepreneur to inform
potential consumers about
the product’s availability or
to educate the consumer,
using advertising media such
as print, radio, or television.
 Marketing Strategy:
Consumer versus Business-
to-Business Markets
•Marketing strategy decisions for a consumer
product may be very different from the
decisions for a business-to-business product.
•In business-to-business markets the
entrepreneur sell the product or service to
another business that uses the product or
service as part of its operations.
•Involves a more direct channel of distribution
because of the volume of each transaction and
the need to relate product knowledge to the
business buyers.
 Budgeting the Marketing
Strategy
Effective planning decisions must
also consider the costs involved in
the implementation of these
decisions. If the entrepreneur has
followed the procedure of detailing
the strategy and action programs to
meet the desired goals and
objectives, costs should be
reasonably clear.
Implementation of the market
Plan
The marketing plan is meant
to be a commitment by the
entrepreneur to a specific
strategy. It is not a formality
that serves as superficial
document to outside financial
supporters or suppliers.
 Monitoring the Progress of
Marketing Actions
Monitoring of a plan involves
tracking specific results of
the marketing effort. Sales
data by product, territory,
sales rep, and outlet are a
few of the specific results
that should be monitor.