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A written marketing plan is important for business owners to identify customer needs and state how your product or service will meet those needs at a target price. Plans set target goals for marketing efforts, number of potential customers reached, budgeted expenses and sales projections. It also explains the types of advertising that will be used to meet those goals. The plan is used internally by the business owner but also helps communicate the business's goals to investors and creditors.
The first step is to develop a mission and purpose statement for your marketing plan, other than the obvious one of simply selling your product. A good mission statement explains why your company is in business and how the marketing strategy you employ will help reach specific business goals in keeping with your stated mission. A sample marketing mission statement would include a statement such as, "to deliver prompt, courteous and quality service to all customers." A marketing mission statement should be consistent with the overall business mission statement.
Describe Product or Service and Market
In the second and third steps give a detailed description of the product or service offered, and the market to be served. If you are selling a product, include the color, size, shape or any other distinguishing characteristics. If you are selling a service, give the details of exactly what the customer will receive. List positives and negatives of your offering and how the positives will satisfy the identified target market. Give specific demographic details as to who exactly is going to buy your product.
Identify the Competition
The fourth step is to identify your direct and indirect competitors. Direct competitors are businesses offering a product or service that rivals your product. Identify how these companies or products compare to yours in their makeup, marketing and price. Indirect competition is any environmental factor or barrier that affects sales. An example would be opening a specialty barbecue restaurant in an area where chicken and hamburger restaurants may be more popular.
Setting the Price
In step five look at internal costs to determine minimum pricing. The profit margin you receive is based on these costs and how much the competition charges for similar offerings. In this step, determine your pricing strategy. Will you follow the competition and price similarly, or will you cut profit margin to be a low cost provider?
The Advertising and Promotion Mix
The sixth and seventh steps -- developing a promotion mix and advertising plan -- are similar in that they both involve explaining what type of advertising, specific media outlets and specific promotions you will use to reach your market. Develop a promotion mix, or what marketing activities you will use to reach prospects. Choose a mix of online, print, e-mail, direct mail and direct sales promotion that will be effective in reaching your audience. For example if your audience is younger, more online resources may be used in lieu of certain print advertising. From this information determine what specific advertising opportunities are available and will be most effective.
Develop a Budget
Step eight is to develop a budget plan based on available capital that will give you the best return on investment. If you find from marketing research that pay-per-click online advertising and email campaigns may be more cost effective than purchasing specific website banner advertising, your budget should reflect this choice.
Step nine mostly applies to businesses that have a physical storefront, as location can drive traffic and increase sales. Determine what location will give you the most exposure without breaking your business budget. For those businesses where location is not a driver of sales, state how a chosen location or other logistical issues factor into the speed of your product or service delivery.
Estimate Your Sales
Step ten is to estimate potential sales based on the demographics of your target market. These demographics can be obtained through your own previously conducted market research information, census data or through available research conducted by business and trade associations.
Production and Business Demands
Step eleven is to determine how many products you will need to produce or how many customers your service business will need to meet the established sales goal. This affects expenditures on employees, materials and equipment.
The last step is to list individual action items in order of importance that will need to be completed to carry out your marketing plan. This may need to be reviewed periodically as elements of your marketing or overall business plan are revised or updated.
Tim Burris has over seven years experience writing and editing formal sales proposals and marketing materials. Tim has also worked as a freelance journalist for two news organizations. His cover story in "NUVO Newsweekly," Financial Disclosure, May 5, 2004, won an award from the Indiana Society of Professional Journalists. Tim has a Bachelor of Science degree in business, finance from Indiana University.