MARKETING STRATEGIES The marketing strategy section of the business plan will explain the business’ strategy on how to get the target customers to buy the product or service. It includes the following parts: 1. Customer profile 2. Marketing Mix (Product, Price, Place, Promotion) 3. Marketing Communication Mix 4. SWOT Analysis of the business.
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3 1. CUSTOMER PROFILE
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CUSTOMER SEGMENT The target customer must be specific and not general. Customer segmentation is the practice of dividing a customer base into groups of individuals that are similar in specific ways relevant to marketing. A customer maybe divided into attributes: 1. Demographics 2. Buying Habits 3. Psychographics
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DEMOGRAPHICS Age Gender Educational Level Income Level Occupation Family Life Geograpic location
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BUYING HABITS Role Frequency Online/Mobile/Offline Recommendations from family, friends or colleagues Social proof
CUSTOMER PROFILE After segmenting the customers, there should be a detailed explanation to match the product or service to the target customers.
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9 2. MARKETING MIX
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MARKETING MIX The marketing mix is the combination of marketing activities than an organization engages in so as to best meet the needs of its target market. Traditionally there are four elements, Product, Price, Place and Promotion. The mix of these elements enables the organization to meet its marketing objectives and to satisfy the requirements of customers. MIchael Karl M. Barnuevo, MBA 10 PRODUCT Products are offerings that a business offers to the target market to satisfy their needs and wants. Product can be tangible good or intangible service. In this part the product must be described and explained: 1. Physical Attributes 2. What does the product do 3. What are the benefits 4. How do they differ from competitors
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PLACE Place or distribution refers to making the product available for customers at convenient and accessible places. It should explain the following: Where is the strategic location of the business Where does the business manufacture it’s product How does it get to the customers What are the distribution methods
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PRICE Price is the amount that is charged by marketer of his offerings or the amount that is paid by consumer for the use or consumption of the product. Price is crucial in determining the organization's profit and survival. Adjustments in price affects the demand and sales of the product. Businesses are required to be aware of the customer perceived value of the product to set the right price. The following should be identified: 1. The right price for the product 2. Justification on the price, based on the customer segmentation
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PROMOTION Promotion represents the different methods of communication that are used by marketer to inform target audience about the product. Different promotional efforts is called Marketing Communication Mix
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3. MARKETING 15 COMMUNICATION MIX
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MARKETING COMMUNICATION MIX The marketing communication mix is the specific mix of advertising, personal selling, sales promotion, public relation, and direct marketing a company uses to pursue its advertising and marketing objectives. Elements of the mix are blended in different quantities in a campaign.
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ELEMENTS OF COMMUNICATION MIX Advertising - Reaches large, geographically dispersed audiences, often with high frequency; Low cost per exposure, though overall costs are high; Consumers perceive advertised goods as more legitimate; Dramatizes company/brand; Builds brand image; may stimulate short-term sales; Impersonal, one-way communication; Expensive Personal selling - Most effective tool for building buyers’ preferences, convictions, and actions; Personal interaction allows for feedback and adjustments; Relationship-oriented; Buyers are more attentive; Sales force represents a long-term commitment; Most expensive of the promotional tools
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ELEMENTS OF COMMUNICATION MIX Sales promotion - May be targeted at the trade or ultimate consumer; Makes use of a variety of formats: premiums, coupons, contests, etc.; Attracts attention, offers strong purchase incentives, dramatizes offers, boosts sagging sales; Stimulates quick response; Short-lived; Not effective at building long- term brand preferences Public relation - Highly credible; Very believable; Many forms: news stories, news features, events and sponsorships, etc.; Reaches many prospects missed via other forms of promotion; Dramatizes company or product; Often the most under used element in the promotional mix; Relatively inexpensive (certainly not 'free' as many people think--there are costs involved)
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ELEMENTS OF COMMUNICATION MIX Direct marketing - Direct communication with carefully targeted individual consumers to obtain immediate response and cultivate lasting relationship. Many forms: Telephone marketing, direct mail, online marketing, etc.; Four distinctive characteristics: Nonpublic, Immediate, Customized, Interactive; Well-suited to highly-targeted marketing efforts Sponsorship - Sponsorship is about providing money to an event, in- turn the product or company is acknowledged for doing so. E-marketing - Online marketing is also gaining importance these days. It is selling through the use of internet.
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20 SWOT ANALYSIS
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SWOT ANALYSIS A SWOT analysis is an organized list of your business’s greatest strengths, weaknesses, opportunities, and threats. The point of a SWOT analysis is to help the firm develop a strong business strategy by making sure you’ve considered all of your business’s strengths and weaknesses, as well as the opportunities and threats it faces in the marketplace.
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STRENGTHS (INTERNAL, POSITIVE FACTORS) Strengths describe the positive attributes, tangible and intangible, internal to your organization. They are within your control. What do you do well? What internal resources do you have? Think about the following: Positive attributes of people, such as knowledge, background, education, credentials, network, reputation, or skills. Tangible assets of the company, such as capital, credit, existing customers or distribution channels, patents, or technology. What advantages do you have over your competition? Do you have strong research and development capabilities? Manufacturing facilities? What other positive aspects, internal to your business, add value or offer you a competitive advantage? MIchael Karl M. Barnuevo, MBA 22 WEAKNESSES (INTERNAL, NEGATIVE FACTORS) Weaknesses are aspects of your business that detract from the value you offer or place you at a competitive disadvantage. You need to enhance these areas in order to compete with your best competitor. What factors that are within your control detract from your ability to obtain or maintain a competitive edge? What areas need improvement to accomplish your objectives or compete with your strongest competitor? What does your business lack (for example, expertise or access to skills or technology)? Does your business have limited resources? Is your business in a poor location?
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OPPORTUNITIES (EXTERNAL, POSITIVE FACTORS) Opportunities are external attractive factors that represent reasons your business is likely to prosper. What opportunities exist in your market or the environment that you can benefit from? Is the perception of your business positive? Has there been recent market growth or have there been other changes in the market the create an opportunity? Is the opportunity ongoing, or is there just a window for it? In other words, how critical is your timing?
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THREATS (EXTERNAL, NEGATIVE FACTORS) Threats include external factors beyond your control that could place your strategy, or the business itself, at risk. You have no control over these, but you may benefit by having contingency plans to address them if they should occur. Who are your existing or potential competitors? What factors beyond your control could place your business at risk? Are there challenges created by an unfavorable trend or development that may lead to deteriorating revenues or profits? What situations might threaten your marketing efforts?
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THREATS (EXTERNAL, NEGATIVE FACTORS) Has there been a significant change in supplier prices or the availability of raw materials? What about shifts in consumer behavior, the economy, or government regulations that could reduce your sales? Has a new product or technology been introduced that makes your products, equipment, or services obsolete?
Marketing Management for Beginners: How to Create and Establish Your Brand With the Right Marketing Management, Build Sustainable Customer Relationships and Increase Sales Despite a Buyer’s Market