HOW TO WRITE A MARKETING PLAN
A customer focused business ethos is a proven method to increase the chances of a sustainable and profitable future. The marketing planning process is at the heart of any truly marketing orientated company, and ensures the customer is at the centre of all key decisions.
The plan is a detailed written document which can be used to promote a single product, of form the annual business strategy. We have split the marketing plan into three steps, which are easy to follow and equally relevant to both small and large businesses.
Stage 1: Research and planning
Understand your customer and the marketing environment, look for opportunities for growth.
Stage 2: Developing your marketing strategy
Identify objectives and choose the right path to exploit opportunities highlighted in the research stage.
Stage 3: Determining actions and controls
Implement your strategy and track success.
The marketing planning process is summarised in the diagram below
A diagram of the stages reflected in a marketing plan
The marketing plan should provide direction for all relevant members of the organization and should be referred to and updated throughout the year. The main purpose of the marketing plan is to provide a structured approach to help marketing managers consider all the relevant elements of the planning process.
STAGE 1: RESEARCH & PLANNING
This section includes the following:
Statement of your current situation and scope of the plan
Research into potential / current customers
Examining the marketing environment
Identifying opportunities for growth
CURRENT BUSINESS SITUATION
Summarise your current position, possible items include:
Sale figures and trends
Level of repeat business
THE MARKETING ENVIRONMENT
Examining both the internal and external marketing environments can identify both opportunities and threats to the business and is a core component of the plan. The whole area is usually broken down into the macro, micro and internal environments as summarised in the diagram below.
The marketing environment
A commonly used method of quantifying the macro external environment is with aPEST analysis. PEST is an acronym which divides the macro-environment into four areas – Political, Economic, Social, and Technological, examples of which are explained below.
Political environmental factors
Economic environmental factors
Rate of inflation
Growth of the housing market
Social environmental factors
Shifts in attitude
Attitudes to career
Technological environmental factors
Emergence of new communications channels
Improved production processes
Advances in computing and the internet
New technologies such as electric vehicles
Reduced cost of materials
The micro-environment includes factors which are still not directly under the control of the company, but more directly relevant to strategy such as consumer trends, stakeholders, suppliers and competitors. Some example items are listed below.
Summary of your market segment
Market growth, trends and competition
Potential new markets
Direction from shareholders
Supplier costs and service quality
Changes in consumer behaviour
Understanding your customers and market
Ensuring a thorough knowledge of the consumer is vital for successful marketing planning. Use the primary and secondary (first and second hand) market research information at your disposal to describe your customer. As your understanding of the audience improves, you’ll be able to design products which cater for their needs better, and you will be able to communicate with them more directly. If you have a broad customer base, you might need to split your customers into groups (segmentation). Some examples are shown below.
Typical customer demographics
Article on segmentation, targeting & positioning
Understanding your competitors
Who are your competitors?
What are they likely to be doing?
Reputation and brand equity
How are they using the marketing mix?
Infrastructure and supply chain
The internal marketing environment includes factors that the business can directly influence. This can include:
The organisational structure
The strengths and weaknesses of a department
Financial stability and resources
Spare production capacity
IDENTIFYING OPPORTUNITIES IN THE MARKETING ENVIRONMENT
Once you have completed the internal and external environmental audit, you can summarise your findings using a SWOT analysis which can be used to make key decisions.
A ‘SWOT analysis’ is a useful way of summarizing the results of the environmental audit and presenting the current status of a business. SWOT simply stands for the Strengths, Weaknesses, Opportunities and Threats which have emerged from examining the macro, micro and internal marketing environments.
For example, here is a SWOT analysis for a fictional electric car manufacturer
Our electric motors are cheap to produce and maintenance free
Charge time is class leading
Production capacity can be increased
R&D department is class leading
Batteries are heavy, slow to charge and provide limited mileage
Dealer network is small
Customer trust in the segment is low
Market is highly competitive
Government grants are available
Road tax breaks for electric cars
Market is growing rapidly
Battery technology is evolving
Tesla has secured a large government grant
The big players are investing heavily
Hybrid and diesel technology is evolving fast
STAGE 2: MARKETING STRATEGY
This section includes the following elements:
Development of a mission statement
Statement of objectives
Strategy and tactics to accomplish the objectives
Your mission statement is a formal commitment and focus for the business. It should explain to customers concisely what the nature of your business is and where you are going, and also provide a motivational tool for employees. It should be aspirational, something to strive for, yet obtainable and relevant. Once this has been defined it should form the focus for your business strategy.
A vision statement is a more long term, ideal-world statement which outlines where you would like to take the business in the long run.
Combined with the mission statement, your objectives should be the key statements that drive your business. The most successful goals follow the SMARTacronym. Specific, measurable, achievable, realistic and time bound.
What do you want to achieve by the end of this year?
Where do you want to be in one, five, ten years?
Objectives must be quantitative in order to measure success accurately. For example, ‘sell 600 units in the next year’ or ‘increase customer retention by 20%’.
SELECTING A SUITABLE STRATEGY
DEVELOPING A STRATEGY FOR GROWTH – THE ANSOFF MATRIX
Most businesses need to grow, and the Ansoff Matrix (below) is a method of determining the best course of action if growth is your priority.
The Ansoff matrix
Increasing market share in a current market with a current product.
Aggressive pricing policy (see ‘cost leadership’ in Porter’s model)
Increasing marketing spend
Taking existing products into new markets
Finding a new use for an existing product
Expanding the distribution network
Strategic partnerships in international markets
Developing a new product for a market that you have already entered
Creating a range of similar products, for example, shaving foam if you are already manufacturing razors
Developing a new product for a completely new market
Product research and development
DEVELOPING A PRICING STRATEGY
Once you have determined the product and market you want to be in, the next problem will be setting a price. Porter’s model discusses three strategies for competitive advantage based on price.
Three generic strategies for competitive advantage – Porter’s model
Cost leadership: A good quality product at a lower price than the competitors
Differential strategy: A product or service which is perceived as unique within a particular market
Focus strategy: Delivering focused attention to a particular segment to deliver service which competitors cannot compete