Introduction
In today’s fast shifting economic realm and in the midst of technological developments, large or small scale businesses have to calculate and plan ahead in order to succeed. While there are many multifaceted elements that add to setting up, sustaining and refining any business, a significant tool that is extensively used is the marketing plan. This paper aims to analyze and discuss the full spectrum of the fundamentals of developing a marketing plan by presenting and analyszing the structures and elements that constitute it.
Developing a comprehensive marketing plan is always a challenging task because it is not one-sided in perspective, but draws on the complex elements of psychology, economics and sociology. As people evolve, so do their inclinations and dispositions. Marketing is highly reliant on developing relationships with people, synergizing layers upon layers of experiences with molding brands and public image, and leveraging available resources for the most favorable profit mark-up. It is therefore indispensable to plan and develop a well-organized marketing plan, in order to be ahead and be ready for changes and trends that may emerge from time to time.
While the end-result of developing a marketing plan is ensuring that a business maintains an optimal relationship with its customer base, it thrives on the idea of reaping profits at any economic climate. Planning is a key element and a primary principle in finding a competitive advantage and nurturing sustained growth. If one element of the plan is missing or done incorrectly, it is possible for the business to lose profit.
Role and Nature of Marketing Plan
In order to fully understand the role of a marketing plan in a business, it is first advantageous to start by defining and contrasting it with the business plan. A business plan is wider in scope as it covers strategies and objectives for the whole company, encompassing all undertakings and roles. A business plan is the very first plan that is initiated and analyzed before creating any more new plans. Under a business plan, there are many sub-plans, such as marketing plans, financial plans, sales plans, distribution plans, purchasing plans and IT plans. A marketing plan outlines all the necessary factors that span from understanding market drivers, studying market trends, comparing different media channels for branding and campaigns, just to name a few. The business plan exists to provide the reason or reasons as to why the enterprise operates and remains unchanged, unless there is a necessary step that needs to be taken when operations change. The marketing plan does not remain stagnant; it is built upon learning how to respond to market trends and drivers.
The connection between the marketing plan and the business plan is a vital one. Developing a well-organized marketing plan provides clarity as to where the business is headed to, therefore making it a key driver of a business’ performance (Zoltners, Sinha and Lorimer, 2009). It can be said that without a marketing plan, the business lacks an integral element in meetings its targets. Ferrell and Hartline (2011, p. 32) compares “the marketing plan to a road map, in the sense that it implements the marketing strategy. It instructs employees as to their roles and functions in fulfilling the plan.” The best marketing requires preparation.
Developing a marketing plan is an important part of the business plan but is not a one-time task. It is a continuous process that covers the strategies of an organization and is always connected to the organization’s objectives. Because of the volatility of the market, it is increasingly more important to plan.
Reid and Bojanik (2010, p. 166) have provided some important aspects of consideration when creating a tactical marketing plan. These include finding out the market share, analyzing the organization’s strengths and weaknesses, analyzing promotions retrospectively and identifying sales strategies to use during non-peak period. In order to create an optimal marketing plan it is always recommended to have a thorough understanding of the business plan. All activities, projects and components of the marketing plan should be aligned with the business plan.
Structure of a Marketing plan
Not all marketing plans will have the same lay-out as there is no universal template, this will depend on the size of the company, its objectives, its strategies and its focus. Typically all marketing plans will share common elements. These key elements will be detailed in order to attain a clearer understanding of the topic. Tassiopolous (2008, p. 133) identified the main elements as an executive summary, situational analysis, marketing strategies and implementation.
When developing a marketing plan, Baron and Keller (2007, p. 59) recommend an approach that utilizes coming up with answers to important questions. The first is relevant to product (“What product do I produce and sell”), the pricing decision (““What price do I need to sell my products for to meet my objectives?”), the methods decision (“How do I establish a price for my product?”, and the merchandising decision or “When, where and how do I make delivery of the product to the buyer?”)
The executive summary gives an overview of the plan, and also contains information on what actions will be taken in order for the plan to be effectively implemented. Objectives that are measurable must be identified. Each objective should be measurable in order to determine if the plan is successful. A widely accepted way of creating goals is using the SMART Model, which according to Goodlet (2011) are “ Be specific about your goals; measure what you want to achieve (state your revenue, growth, and profitability goals); explain how you plan and want to attain those goals; be realistic about your goals, don’t set standards so high that it is impossible to reach your goals; and, make your goals be time-bound, set a schedule and stick to it.”
An analysis of the product vis-à-vis the market setting is another integral element in the marketing plan. This part of the plan will contain information on the market trends and forecasts as well as the buyers’ habits and inclinations. This part of the plan necessitates that there is a clear understanding of the current business situation as this will help the organization positions itself in terms of how it can fare alongside market trends and challenges.
Elements of a marketing Plan
An all-inclusive marketing plan will seek to understand factors such as the current market position of the organization in comparison with competitors. Through the use of SMART goal setting, an organization can leverage strategies that will work in their favor. The marketing plan should also contain information that covers distribution costs, manufacturing costs, advertising fees and related expenses.
SWOT (strengths, weaknesses, opportunities, and threats) analysis that provides a realistic review internal and external factors that can affect results. Tassiopolous (2008) further points out that the SWOT analysis has been extensively acknowledged as a simple structure for assessing the strategic position of an organization in implementing its plans. Analyzing the profiles of competitors is another segment that forms part of the structure of the marketing plan. Ryans (2007) argues that there are five points to look into when completing a competitor analysis. These are: listing the competitors and their products or services, their strengths and weaknesses. It is also important to know what marketing mix they use. Lastly, knowing the market outlook forms part of the competitor analysis. Some of the tools that can be used to delve into competitor analysis are the traditional methods such as going through the competitors’ quarterly and annual reports, press releases and advertising.
The key to the competitor analysis is a comparison of the specific features and values of the competitor’s products and services. Greenfield (2010) suggests using customer satisfaction surveys through a third party. It is an ingenious way of knowing how the customers perceive the competitor’s strengths and weaknesses. When putting together this list, Hisrich (2004) advises that the list should be objective. Some of the tools that can be used to identify competitors’ strengths and weakness are through going to their websites or by reaching out to journalists and consultants.
Writing a competitive analysis can be a perplexing exercise. However it is through this that an organization can learn about how they can position themselves in the market sector that they are intending to get into or improve to present more value for their customers. It is also about measuring trends and being honest with leveraging tools to get market share.
The next section focuses on developing marketing strategies that must be outlined clearly and in detail. This process includes formulating mission and marketing objectives, analysing how to position the organization among competitors in the market sector in order to gain a competitive edge and introducing marketing mix. Cohen (2006) and Hatton (2010) stipulate that the following broad factors can be used in determining market objectives: “increasing market segment, increasing market productivity, expanding current markets, developing new product A marketing plan brings together all relevant market factors and identifies the strategies and actions required to achieve your sales goals for existing and future markets, developing new markets for existing products and finding an initial market position.”
Moreover, the marketing plan should include details on its marketing strategies. A wealth of research body shows the most common strategies include the 4ps of marketing (price, product, promotion and place). First introduced by McCarthy in the 1960s, the traditional 4Ps of the marketing mix is widely used and remain popular. The management of an organization must make use of different strategies that involved these four elements.
Although companies will differ in how they present their marketing plans, there are certain common fundamentals. Gilligan & Hird (1986, p. 166) points out these elements, namely “stakeholders’ expectations, internal organization inspections that point out the assets and flaws, prospects and threats that can be found externally, the goals of the organization, strategies that can be taken up by different sections of the organization and alternative strategies.”
It is necessary to identify the target market, determine which products or services are targeted for them, define a market position, study how to price these products or services, and determine which the best ways to deliver these. Only after all the elements of the marketing plan have been understood and developed will it be feasible to create strategies for advertising and promotion.
In developing promotion and advertising strategies, it is important to first understand what message the organization wants to send and what medium should be used. The message should address the needs and wants of an organization’s targeted demographic. It is critical to first identify a predicament and then formulate alternatives to deliver a solution. The purpose of any promotion or advertising is to enlighten, influence, remind existing customers or create new customers.
When identifying the target market there is some literature that recommends getting all the details of the market segments, such as the age, sex, racial and ethnic background. These variables can also be used alongside identifying the accurate training for the organization’s employees. Because marketing is about people’s relations, it is important for employees to know their customers in order to sell their products.
The next section involves determining the appropriate media in which the plans can be delivered. For example, a fitness company attracting young customers can utilize social networking site. Another important avenue in delivering promotions is simply by using an organization’s sales staff. If they are proficient with the current promotions they can easily advertise them to walk-in customers. It is also important to set a budget, which is a significant component of a marketing plan. Since most types of advertising are paid for, there should be an initial understanding of the budgetary limitations prior to determining the factors, resources and activities that can be implemented.
Links between Marketing Plan Elements
As per the aspects discussed above it may be concluded that elements in marketing plan are not independent but interconnected in a manner that all aspects affect one another. This aspect can be observed in the fact that marketing plans generally have a sequence in analysis with regards to the elements or sections encompassed.
Many researchers have emphasized the importance of understanding the difference between a strategic marketing plan as opposed to a tactical marketing plan. McDonald and Wilson (2011, p. 30) points out that the first difference lies in the covered period, where a strategic marketing plan comes from a careful examination of the organization’s marketing objectives and usually delineates strategies in the next three to five years and a tactical marketing plan covers a shorter period of time. This is why it is important to draw up a strategic plan before preparing to write the tactical marketing plan. Because marketing is complex, it is first necessary to understand the market segments and positioning products before a plan on how to effectively respond to competition and shifting situations can be done. How an organization can respond to these elements correspond to its strategy and would normally contain a significant component of the marketing mix, namely product, price, promotion and place or distribution.
A few questions that should be answered prior to setting up the appropriate budget would be identifying what particular problem does the project address, it is key to consider what problem the product and/or service is solving for the existing or prospective customers; identifying the market opportunity, this should include covering the overall size of the market, in terms of units and dollar value; and discussion of the market niche or segment, which includes the composition of the market in the geography that is being targeted, the products/services that will be provided;.
In a fully delegated management structure, the chief executives and top management who are involved in the strategic planning should approve to the components of the final marketing plan. The subsequent activities on how to implement departmental operation plans linked back to the marketing plan are then headed by specific department heads or team managers.
Assumptions of Marketing Plan
Some people mistakenly assume that a marketing plan only delineates an organization’s promotion and advertising strategies. Fleming (2000) supports this when she supposes “Advertising is only a small part of marketing. Yet, it is important to realize that most successful businesses are relationship-oriented organizations.” It is easy to wrongly assume that the most important element of a good marketing plan is the advertising and promotion strategies. Advertising and promotion are both integral parts of a marketing plan but there are several other elements that come into play.
Creating a marketing plan can help a business focus on their high-priority activities that will likely generate more clients quickly. The general assumption that a marketing plan can only be done once when the business starts is also incorrect. Some markets are volatile and market trends may emerge at any period of time, therefore any business should be alert and ready to revise its marketing plan as necessary. The key element of a successful marketing plan is to identify the customers. It is essential to have an understanding of their likes, dislikes and expectations. Another important factor is identifying competitors’ strengths and weaknesses. Both of these factors may change over time as these are not fixed variables. It is therefore important to keep updated about customers and their preferences. When it comes to competitor awareness, it is critical that a business knows what the competitor has lined up on its promotions, products and services. For instance a small-time business may receive funding from a bank or find new partners and launch big scale promotions.
Conclusion
With all the available literature on marketing plan, it is conclusive to say that marketing plans are important tools for businesses that forms part of their total business plan. Not only is the marketing plan a useful tool for laying down goals on paper, allocating budget, time and resources towards attaining goals but it is a springboard for detailing strategies.
According to Callum (2010) the “internet has revolutionized advertising,” as a result many organizations capitalize on firming up their brand as well as increasing their marketing presence from local to global settings. Some of the recent tools with regard to the internet that are being incorporated into marketing plans toady include advertising on different high traffic websites that are frequented by an organization’s target market, advertising in blogs and monthly e-newsletters and incorporation of search engine optimization. For some organizations, it is useful to take account of support from a marketing or public relations company or agent who can render assistance in arranging and guarding their products and services as well as observing and assessing their advertising efforts.
Marketing plans are detailed strategies that organizations can use to help them attain their goals. Decision making is a big part of creating a marketing plan; choosing the best course of action should always be included in the final marketing plan. It is critical that marketing executives have a thorough understanding of the elements that constitute a marketing plan, how they are linked and what makes them essential, dynamic ever changing company tools.
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