Marketing the fundamentals

SmallBizU Online eLearning
www.smallbizu.org

Christene Swanepoel
www.christene-marketing.info

•To help you understand what marketing is.

•To help you learn how to conduct market research.

•To help you understand how to analyze your market
environment and determine your target market.

•To help you determine how to position your product.

•To educate you on the 4 P’s (product, price, place & promotion)
and how to apply them to marketing.

•To show you the basics on how to create a marketing plan.

Most people mistakenly identify marketing with
selling and promotion.

While selling and promotion are a part of marketing,
they are not most important part.

In Principles of Marketing Philip Kotler stated:

If the marketer does a good job of identifying consumer needs,
developing appropriate products, and pricing, distributing, and
promoting them effectively, these goods will sell very easily.

Marketing can be defined as an activity directed at
satisfying needs and wants through exchange processes.

The ultimate goal of marketing is to make selling
nonessential,

To know and understand the customer so well that the
product or service fits him or her and sells itself.

Marketing deals with goods, services, and ideas.

A good is something someone can touch.

A service is providing an intangible benefit to
customers.

An idea can include concepts or images.

For this course, we will use the word product to refer
to goods, services, and ideas.

One of the underlying concepts of marketing is
trying to satisfy a customer’s needs, wants and
demands.

Needs are plentiful. Basic human needs include
food, clothing, warmth, safety and belonging.

Wants are simply needs shaped by culture and the
individual.

Demands are simply the wants of a consumer when
backed by the ability to pay for that want.

Marketing usually occurs to help facilitate
an exchange between a buyer and seller.

There are many forces that affect the marketing
environment, including:

Competition
Laws and Regulations
Economic and Social Conditions
Cultural Factors

These forces can be dramatic and difficult to predict.

Be aware of these forces because they can create threats
and generate opportunities for your business.

The marketing mix is another important concept
when it comes to marketing.

The marketing mix refers to activities that a firm can
control to produce the response it wants from the
target market.

These variables can be categorized into four groups,
also know as the four P’s of marketing.

1. Product – This is what you are offering to
your target market, be it a tangible
product or a service.
2. Price – The amount you will charge for
your product.
3. Place – Channels your product will go
through to reach the customer.
4. Promotion – How you raise awareness
with your target market.

While the previous four P’s are important to the
marketing mix, there is one that is left out.

Positioning
Positioning is not dealing with where you will
place your product in the market, but where you
will place you product in the mind of the
consumer.

There are two main types of data that will help you
in researching your market.

The first is secondary data. Secondary data is
information that already exists somewhere. It was
collected for another purpose.

Primary data, consists of information collected for the
specific purpose at hand.

Researchers will usually start by collecting
secondary data.

Secondary data can be obtained quicker and at lower
costs.

When collecting secondary data evaluate it carefully to
make sure that it is:

Relevant
Accurate
Current
Impartial

With all the resource outlets that exist today,
there are many opportunities for you to gather
secondary information on the industry you will be
participating in.

The following sources should help you in getting
started:

NAICS Code
Hoovers
Standard & Poor’s

Before you start researching your customer, it is
important that you determine whether they will
be individuals in a particular area or if they will be
other businesses.

There are many secondary data sources for
researching consumers.

Consumer expenditure surveys
Census data
VALS – (Values, Attitudes, & Lifestyles Surveys)

If your target customers are other businesses,
the following links may be helpful in conducting
research:

Business expenditure survey
IRS data
Economic census

After you have determined who your customer
will be and found some of their characteristics,
You need to estimate the size of your target
market.

IRS, Census, RMA, and Dun & Bradstreet are all
sources that can help you estimate your target
market size.

Since primary data does not already exist it can
become very costly and time consuming to gather.

There are several ways to collect primary data.

The most common methods are observation, survey,
and experiment.

These methods can be done by mailings, telephone
calls, and personal interactions to name a few.

Data is gathered in the observational approach by
watching people in either a natural or artificial setting.

The survey approach is best suited for those who are
looking to gather descriptive information.

The experimental approach involves selecting two
groups, giving them different treatments, and then
measuring the effects.

With mail questionnaires you can collect a fairly
large amount of information at a low cost.

Telephone interviewing costs more than mail questionnaires but
can provide more information quickly.

Individual interviewing is another way of gathering information.
This type of interviewing may require an incentive to get people
to participate.

Gathering a group of people together to discuss certain topics
with a trained interviewer is known as group interviewing.

When developing a questionnaire keep the
following in mind:

Take your time to make sure that it is carefully developed
and tested.

Carefully choose your wording of each question.

The sequence of the questions is also important.

Make sure that all the questions included in the survey are
necessary.

Interpreting data can easily become
overwhelming if you are not careful.

Make sure that you report only major findings.

Do not use too many statistical analyses just for the
sake of using them.

Put your findings into simple terms so that even
someone not familiar with the survey will be able to
understand them.

The marketing environment is made up of two
environments;

The micro-environment is the immediate
environment that effects the companies ability to
serve customers.

The macro-environment consists of larger social
forces that affect all players in the
microenvironment.

All groups in a company - Accounting, R&D,
Manufacturing, Top Management – are part of a
company’s microenvironment.

All these departments will have an impact on the
marketing decisions and actions of the company.

For this reason, the marketing manager should try to
work closely with these departments and others when
establishing a marketing plan.

Distribution channels will also play a role in the
microenvironment.

Suppliers, middlemen, warehouses and transporters
are just a few of the factors that will effect the
business.

Be aware of these factors and how they will affect
your market planning and decisions.

Which customer market will the company
operate in?

Consumer
Industrial
Reseller
Government
International

Each of these markets’ characteristics should be
analyzed on how they will effect the company.

The number of firms that supply a similar
product will play a role in the competitive
environment.

Once you determine the number of competitors,
you should then analyze competitive tools that will
set you apart from the competition or give the
competition an advantage over you.

The first competitive tool most companies will use is
price.

Be aware of the actions of your
competitors.

Also develop an understanding of the
market you are participating in, and what
the customers in this market want.

A SEPTE analysis is a process that helps in
analyzing the macro-environment.

SEPTE stands for…

Social environment
Economic environment
Political and legal environment
Technological environment
Environmental issues

Social environmental factors include
demographics and cultural aspects.

These factors affect customer needs and the size of
potential markets.

Some social factors include:

population growth rates
population shifts
age structure (youths, young adults, retirees, etc.)
the changing in family structure

Economic trends can affect the marketing
environment in several ways.

Fluctuations in real income determine how much
consumers will have to spend on discretionary
goods and services.

Also take into account the income distribution and
the average income of your target market.

Other economic factors include income, cost of
living, interest rates, and savings and borrowing
patterns.

These factors can have a substantial impact on the
marketplace.

Developments in the political and legal
environment can have serious consequences on
your marketing efforts.

Be aware of:

Legislation regulating business
The affects of government agencies such as the
FDA, FCC, or EPA on your company.
Growth of public interest groups that positively or
negatively affect your business.

Technological factors can lower barriers to entry
and influence outsourcing decisions.

Some examples of technological factors include R&D
activity, automation and rate of technological
change.

Another factor that may affect the technological
environment is if a company concentrates only on
minor improvements or major innovations.

In our ever changing world, marketers should pay
close attention to certain environmental factors that
could create tremendous impacts on the
marketplace.

Impending shortages on raw materials, increased
cost of energy, increased levels of pollution, and
government regulations and intervention all play a
role in the environmental marketplace.

The first step in selecting your target market
is to determine whether your customers are
consumers or businesses and industries.

Keep in mind that you can have more than one
target market. However, if you find the
description of your market too broad or general,
then ask yourself:

Is there really more than one target market
here?

Next consider the geographic level you will target.
Will your customers be mostly at the local, state,
national or international level?

You also need to decide what the geographic
makeup of your target market will be.

You can classify your target market as either rural,
suburban, urban, or a mix of any of these.

What characteristics will your target market share
that will differentiate them from others?
These variables should be measurable and can
include any of the following:

-Age - Education
-Gender - Occupation
-Race - Family Size
-Ethnicity - Marital Status
-Income - Social Class

Many resources are available to help you define
the demographics of your target market.

U.S. Census Bureau

Psychographics help define characteristics of a
group based on their lifestyle, personality, and
social class.

One of the most popular surveys of
psychographics is known as the VALS.

Value, Attitude, Lifestyle Surveys

VALS place consumers into certain segments
based on their responses to a particular survey.
There are eight segments that they may be placed
into.

These segments are then defined by certain
characteristics and traits that they share.
For more information go to:

http://www.sric-bi.com/VALS/

To recap, when selecting your target market it
is easiest to start broad and then move to more
narrow to define your market.

Are you targeting consumers or a business/industry?

What is the geographic makeup of your target market?

What are the demographics of your target market?

What are the psychographics of your target market?

One of the best-known names in American
advertising circles is David Ogilvy.

After spending several billion dollars on advertising,
Ogilvy listed 32 things his ad agency had learned.

Of the thirty-two, he said that the single most
important decision involved positioning the product.

He claimed that marketing results depended less on
how advertising was written than how the product or
service was positioned.

In their 1981 book, Positioning: The Battle for your Mind,
Al Ries and Jack Trout describe how positioning is used as a
communication tool to reach target customers in a crowded
marketplace.

Not long thereafter, Madison Avenue advertising executives
began to develop positioning slogans for their clients and
positioning became a key aspect of marketing
communications.

While positioning begins with a product, the concept really is
about positioning that product in the mind of the customer. In
other words, marketing is a battle of perception, not products.

Ries and Trout explain that the concept is really
about positioning a product in the mind of the
customer. Strategy is therefore planned in the mind,
not the marketplace.

This approach is needed because consumers are
bombarded with a continuous stream of high-volume
advertising.

The consumer's mind reacts to this high volume of
advertising by accepting only what is consistent with
prior knowledge or experience.

It is quite difficult to change a consumer's
impression once it is formed.

Consumers cope with information overload by
oversimplifying and are likely to shut out anything
inconsistent with their knowledge and experience.

In an over-communicated environment, the advertiser
should present a simplified message and make that
message consistent with what the consumer already
believes by focusing on the perceptions of the consumer
rather than on the reality of the product.

The easiest way of getting into someone's mind is to be
first.
It is very easy to remember who is first, and much more
difficult to remember who is second. Even if the second
entrant offers a better product, the first mover has a large
advantage that can make up for other shortcomings.

However, all is not lost for products that are not the first.
By being the first to claim a unique position in the mind of
the consumer, a firm effectively can cut through the noise
level of other products.

Miller Lite was not the first light beer, but it
was the first to be positioned as a light beer, complete
with a name to support that position.

Similarly, Lowenbrau was the most popular German
beer sold in America, but Beck's Beer successfully
carved a unique position using the advertising:

"You've tasted the German beer that's the most
popular in America. Now taste the German beer that's
the most popular in Germany."

If a product is not going to be first, it then must
find an unoccupied position in which it can be first.

At a time when larger cars were popular, Volkswagen
introduced the Beetle with the slogan "Think small.”
Volkswagen was not the first small car, but they were
the first to claim that position in the mind of the
consumer.

Sometimes there are no unique positions to carve out.
In such cases, Ries and Trout suggest repositioning a
competitor by convincing consumers to view the
competitor in a different way.

Tylenol successfully repositioned aspirin by running
advertisements explaining the negative side effects of
aspirin.

Repositioning a competitor is different from comparative
advertising. Comparative advertising seeks to convince the
consumer that one brand is simply better than another.

Consumers are not likely to be receptive to such a tactic.

Sun Tzu stated, "battles are won or lost before
they are ever fought.“

The concept of positioning applies to products in the
broadest sense.

Services, your business itself, tourist destinations,
countries, and even careers can benefit from a well-
developed positioning strategy that focuses on a niche
that is unoccupied in the mind of the consumer or
decision-maker.

Ask yourself, “How can I be the first to claim a
unique position in the mind of my customer.”
What exactly is my positioning message?

Remember, your consumer's mind reacts by accepting
only what is consistent with their prior knowledge or
experience.

Don’t try to change their mind, instead find a position
that they already believe to be true or have trouble
being in opposition to such as the “Clean Air Act.”

Remember, you must own your niche and own it
outright. No one else can occupy your space.
If you can’t own it, especially from a marketing
expenditure outlay, then decrease the size of
niche until you can.

If somebody else occupies your chosen space try
to reposition them.

Your positioning message is what you will consistently
reinforce to your selected niche.

The message should help your customer identify, understand,
and remember your position.

To be effective, your message needs to be short—usually under
five words—three or less is better.

You should also try to let go of the intangibles such as your
product features and price points and speak to your customer’s
emotions. For example: Just do it—Nike.

Begin by listing why your customers choose to do
business with you rather than your competitors.

Try to list about three to five reasons listed in the
order of importance.

Now, narrow down the key difference between
your business and your competitors in a single
word.

When you listed why your customers choose
to do business with you, it is probably true that you
included words like: quality, customer service,
expertise, selection, or location.

Repeat this to yourself:

These words represent boring, rational argument.
In fact, they are probably the exact words that your
competitor would list as well.

When you appeal to rational thought you, in effect,
create an argument in the customer’s mind.

To solve this issue, try moving your message from
the customer’s head to their heart.

To do this you need to appeal to their emotions.

A grass seed company tried an experiment.

They took their seed and put it into two separate packages:

One simply said Grass Seed and the price of $.99.
The second was named Lawn Seed and showed a beautiful
lawn flowing down toward a river. The price was $3.99.

Remember, the seed inside the packages was identical. But
nonetheless, the Lawn Seed outsold the grass seed by a factor
of 4:1.

People don’t want grass seed but rather the hope, feeling, and
aspiration of having the beauty of that pictured lawn—and
that’s really what they are paying for.

Go back and review your positioning message and ask
yourself, “Does it create boring, rational argument or does
it sell emotional hope and aspiration?”

Start by re-writing your message in a sentence and then
whittle your message down to three words or less.

Remember Nike didn’t say, “We have the highest quality
shoes made through state-of-the-art processes of the best
procured materials meaning they are long-lasting, durable,
and offered at an excellent price point.”
No, be very clear, they said: “Just do it.”

One of the first questions to ask yourself is
what does your product do?

Other questions that you should address are:

What need is addressed by the product?
What are its features and benefits?
Who supplies the products or materials?

Whether you make or resell a product, these
questions are important to answer.

If you manufacture a product, the following questions
need to be addressed:

How is it produced?

What materials and labor are required?

How will its quality be measured and controlled?

What is its technological lifespan?

What research and development has been conducted and
what still needs to be done?

Delivering a service can be quite different then
manufacturing a product.

Some questions to address may include:

What services do you offer?
How do they work?
What materials or equipment is needed?
What are your labor needs for these services?
What are the steps in your service process?
What benefit(s) do you provide customers?

Intellectual property is any product of the human
intellect has some value in the marketplace.

Intellectual property can include business strategies,
images, ideas and concepts.

In some cases it can be worth more to a business
than tangible assets.

For more information on intellectual property visit
the World Intellectual Property Organization.

An important issue that comes up when
discussing intellectual property is how to protect it.

Protection can be obtained through a trademark,
patent or copyright.

For information on patents, trademarks and copyrights go
to…

United States Patent and Trademark Organization
United States Copyright Office

After you have addressed questions about your
product, you should then consider how you will
package it?

The primary function of packaging use to be to hold
and protect the product.

Today, however, packaging is becoming an
increasingly important marketing tool.

Once a company has designed the packaging for a
product, many want to include a UPC barcode on
their product.

You can obtain a UPC barcode through the…

Uniform Code Council, Inc.

Product liability may occur when a customer
suffers harm from using the product.

To incur liability you don’t necessarily have to be the
manufacturer.

Everyone down the supply chain (including the
wholesaler and retailer) could be affected.

A competent professional can help you determine
what level of insurance your business will need.

While some companies only offer one product or
service, most companies try to diversify
themselves by offering a product mix.

A product mix is the set of all product lines and
items that a particular seller offers to buyers.

A new product will go through a four stage
process throughout its lifetime.

The Product Life Cycle Diagram

In the introduction stage the firm is seeking
to build awareness and develop the market.

During the growth stage the company is seeking to
increase their market share by building preference
over their competitors.

In the maturity stage growth slows as similar
products appear on the market.

Sales fall rapidly in the decline stage.

There are a number of internal and external
factors that will come in to play when setting
prices.

Some of the internal factors may include pricing
objectives, strategy and costs.

External factors may include nature of the market
and demand, competition and the economy.

Pricing objectives help answer the question:

What are you trying to achieve with your pricing
strategy?

Survival
Profit
Return on Investment
Market Share
Cash Flow
Status Quo
Product Quality

Once you have determined your objectives you
should then focus on the methods you will use to
determine your prices.

Keep in mind laws that regulate pricing and pricing
strategies such as the Clayton Act.

For more information on the Clayton Act go to:

http://www4.law.cornell.edu/uscode/15/12.html

There are several basic pricing strategies.

Skim Pricing - Set your price high with the goal of
capturing short-term profits.
Penetration Pricing - Set your price low to discourage
competition and appeal to a larger market segment.
Fixed Pricing - Price is set by manufacturer or middleman
and not subject to negotiation.
Variable Pricing - Price is negotiated between buyer and
seller.
Price Lining - Establishes only a few prices for all the items
within a given product line.
Keystone Pricing - percentage markup applied to the
product’s cost.

Other pricing strategies include:

Customary Pricing - set price at the considered
standard level for the product.
Psychological Pricing - strategies that try to make
the product’s price more desirable.
Prestige Pricing - encouraging consumers to equate
pricing with quality and status.
Geographic Pricing - charging different prices for
different regions of geography.
Pricing Leader - determining if you will be a price
leader or follower.

Be aware of the floor and ceiling prices in your market.

The costs of the product will set the floor for the
marketer.

The ceiling is set by the market and its demand.
Set your price between these two points but keep in mind
consumers will compare the price of the product against
the value of owning it.

Avoid establishing where the costs will outweigh the
benefits, and consumers will no longer buy your product.

Consumers will compare the price and value of a
product to that of comparable items.

Learn the prices and quality of your biggest
competitors.

Use this information in helping you to establish a
pricing point of your own.

Booms, recessions, inflation and interest rates all
effect the pricing of a product.

These economic turns will affect the costs to
produce and consumers’ sensitivity to price and
benefits of the product.

Be aware of the current economic conditions and
the economic forecast for the future when
establishing a price.

Once you have set the cost you can then
determine the gross margin for the product.

Product Price (to consumer)
minus Product Cost (to you)
equals Gross Margin of Product

Compare your product’s gross margin with
industry standards from sources such as RMA.

Placing your product is the third of the four P’s.

It encompasses channels of distribution that serve
as a transporter for getting your product to your
customers.

Decisions you will need to make in placing your
product include market coverage, channel
member selection, logistics, and location.

You must first determine which markets you are
going to reach and with what objectives.

Be sure to include items such as the desired level of service and
functions to be performed by channel members.

Constraints to developing your objectives may come from several
sources.

Customers, products, intermediaries, company policies,
competitors, and the environment.

Marketing channels direct the flow of products from
producers to consumers.

They may go directly from producer to buyer.

Producer Consumer

Or the may have several steps between production to consumers.

Producer Wholesaler Retailer Consumer

What part of the distribution process does your
business handle, if any?

Warehousing
Order processing
Inventory management
Packaging
Materials handling
Receiving
Transportation and shipping

As you move down the marketing channel from
manufacturing, to wholesaling and so on, it may
become unclear what your distribution channel will
look like.

Often, retailers believe that they do not have a
distribution channel.

The fact is a retailer’s location is their distribution
channel.

You must decide how many intermediaries will be in the
marketing channel.

Several middlemen will be needed for intensive distribution -
stocking your product in as many outlets as possible.

Limited dealers will be granted the rights to distribute your
product with exclusive distribution.

Selective distribution stands in the middle. It requires more
than one intermediary, but fewer than the intensive
distribution.

An important function of the marketing channel is
the joint effort of all members to create a supply
chain.

Supply chain management refers to the long-term
partnerships among channel members to reduce
inefficiencies, costs, and redundancies in the market
channel.

If managed correctly, a competitive advantage can be
established.

When planning your distribution channel you
should be able to answer the following questions.

What will the ordering process look like?

Where will inventory be located?

How much inventory should be kept on hand?

How should goods be shipped?

There are several ways to handle shipping.

FOB Factory Pricing: The costs of transporting the product from
seller to buyer are borne by the buyer.

Freight Absorption Pricing: Paying some of the transportation
costs in order to bring the price in line with competitors.

Uniform Delivered Pricing: A standard price charged regardless
of location.

Zone Pricing: Charging different prices for different regions of
geography.

What will it cost to lease or buy the needed
facility?

Make sure that you can afford the location that
you choose.

Also find out the term and duration of the lease
of the desired location.

There are a multitude of federal, state, and local
laws governing channel management.

Through such laws as the Sherman Antitrust Act and
the Federal Trade Commission Act, the government
is trying to make sure that free trade and
competition are protected.

The promotional mix consists of four main tools.

Advertising,
Personal selling,
Sales promotion and
Publicity

By identifying these tools you will be able to lay out
the basis of a media plan and promotional budget
for your company.

Advertising deals with communicating with
your customers in a very public way.

By advertising you are able to repeat your
message to customers numerous times in various
formats.

However, be aware that while you are able to get
your message to customers, they do not have to
pay attention to it.

Direct mail
Trade shows
Yellow pages
Newspaper
Magazines
Radio
Television
Outdoor advertising
Email advertising
Telemarketing
Internet

Personal selling may be the most effective tool at
certain times due to…

Personal selling involves face-to-face communication.
Lasting relationships can be established with
personal selling.
When face-to-face with a salesperson, the customer
is more likely to respond.

While personal selling is an effective tool, its cost can be
overwhelming to a company.

If you decide to take part in personal selling,
a sales force will be needed.

Be sure to ask yourself how you will handle the
following:

Recruitment and selection of sales personnel
Training sales personnel
Compensation and motivation
Controlling and evaluating sales force
performance

Sales promotions usually have three distinctive
characteristics that help to set them apart.

1. They provide information and help gain
attention.
2. They provide an incentive to the customer.
3. They encourage the consumer to buy quickly.

Sales promotions for consumers can come in
various forms.

These forms include coupons, demonstrations,
frequent-user incentives, point-of-purchase
displays, free samples, money refunds or rebates
and contests or sweepstakes.

There are also numerous ways to offer sales
promotions to businesses or industries.

When targeting these types of customers try
offering quantity discounts, free merchandise,
buy-back allowances, dealer listings or cooperative
advertising.

A well planned publicity campaign along with
other promotional tools can be highly effective
and help you save money at the same time.

Part of the appeal of publicity is that it can offer
high credibility, it can catch people off guard and
help dramatize a product or company.

What types of publicity tactics will you employ?

A press release is one option. Some reasons to
issue a press release include:

Support of a social cause
Winning of quality awards
New product launches
Speeches of top management

Other types of publicity include public speaking
engagements and public events.

After you decide on which tools from the
promotional mix you want to use, you then need
to develop a promotional budget.

This is usually a major obstacle for companies
because while they may know what tools they
want to use, they may not know how to allocate
money to properly use them.

Many companies set their budget as a
percentage of current or forecasted sales.

While other companies mirror their budget to
that of their competitors.

Still some companies will approximate their
budget by how much the objectives they wish to
meet will cost in advertising dollars.

For retail or location based service companies, the
following formula will usually work in helping to
estimate a promotional budget.

Projected Gross Sales

times 12% (.12)
minus Cost of Rent
equals Advertising Budget

Many entrepreneurs insist that hustle is all that
is required in the marketing of their business.

But energy alone is not enough. Energy must be
directed by intelligence.

Intelligent marketing is marketing that is first and
foremost focused on a core idea.

All your marketing must be an extension of this idea—
it isn’t enough to have a better idea—you need to
have a focused strategy.

A complete marketing plan includes the
following three sections:

The marketing plan identifies the market and your
strategy.

The creative plan is similar to the marketing plan but is
limited to the content of your marketing materials.

The media plan which sets forth and details your selected
media weapons and media calendar.

The marketing plan identifies the market and
your overarching positioning strategy.

The length of your final marketing plan is up to you
and depends on your organizational culture and the
audience that will read and use the plan.

At first, though, try to state it in just one paragraph.
According to Jay Conrad Levinson, author of Guerilla
Marketing, a simple plan can be created in just seven
sentences.

Sentence one explains the purpose of the strategy.

Sentence two explains how you’ll achieve this purpose. It
describes your competitive advantage and benefits.

Sentence three describes your target market—or markets.
Sentence four, the longest, outlines the marketing weapons
you’ll employ.

Sentence five describes your niche—your positioning.

Sentence six reveals the identity of your business.

Sentence seven states your budget, which should be expressed
as a percentage of projected gross revenues.

Almost any marketing person worth his or her
salt will tell you that marketing is not creative unless
it sells.

Advertising legend Leo Burnett used to remind his
staff that a person can be creative by coming
downstairs with his or her socks in their mouth—but
what’s the point?

There must be a reason for your creativity, and your
creativity should never detract from your message.

A creative strategy is similar to a marketing plan
but is limited to the marketing materials only—and
directed solely at their content.

A creative plan can be written in as little as three
sentences which detail:

The purpose of the creative message
How the purpose will be achieved
The mood, tone, or personality of the advertising

Once you’ve selected the marketing media and weapons
that can propel you to your goal, be sure you use them in
an orderly, logical manner.

This can best be accomplished by the third and final
section of your marketing plan: the marketing calendar.

A marketing calendar indicates whether or not you can
use these methods properly because it forces you to
come to terms with the costs and realities of the media
you select.

In some cases you may need a more in-depth
marketing plan.

This plan can be structured in the following format.

Executive Summary
Challenges
Situation Analysis
Market Segmentation
Selected Marketing Strategy
Short & Long-Term Projections
Conclusion
Appendix

The executive summary is simply a summary of
the marketing plan.

It should highlight the main points of your plan.

The challenge section of the marketing plan should
include a brief description of the product that will
be marketed.

The challenge should also include associated goals
such as sales figures and strategic goals.

The situation analysis should include the following:

Company Analysis - Goals, culture, strengths and
weaknesses.

Customer Analysis - Number and type of customer, value
drivers and decision process.

Competitor Analysis – Market position, strengths,
weaknesses and market share of competitors.

The situation analysis should include a section
on collaborators such as subsidiaries, distributors, etc.
A SEPTE may also be included in the situation analysis.
A SEPTE analysis will help in measuring the:

Social and cultural environment
Economic environment
Political and legal environment
Technological environment
Environmental issues

A SWOT analysis is the last section of the
situation analysis.

This type of analysis helps to determine internal
and external environmental factors.

The internal factors are the strengths and
weaknesses of the business.

The external factors are the opportunities and
threats in the market.

The purpose of the market segmentation section is to
help describe the segment(s) of the market you are targeting.

Included in this segmentation are:

A description of the target market
Percent of sales for this group
What they want
How they use the product
Support requirements
How to reach them
Price sensitivity

Include a segment analysis for each market segment you are
targeting.

This section of the marketing plan should include
a discussion of the strategy you have selected.

It should include decisions you have made
regarding each of the 4 P’s (product, price, place,
and promotion).

Be sure to include things such as brand name,
scope of product line, list price, payment terms,
distribution channels and advertising issues in
this section.

The short and long-term projections should
include immediate and future desired results and how
these results will be achieved.

This section may also include a forecast of revenues
and expenses related to the plan.

A conclusion should be placed at the end of the plan to
summarize the plan’s contents.

Any other information that may pertain to the
marketing plan should be paced in the appendix.

The Father of Modern Management, Peter
Drucker emphasized the importance of
marketing when he said:

“There are only two functions of a
business: marketing and
innovation.”

Remember, there is no business without first
a customer.

Marketing the fundamentals

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