How to... A Guide to Writing a Marketing Plan

How to... A Guide to Writing a Marketing Plan

How you can succeed in writing a marketing plan A good marketing plan will identify your business goals, set objectives and targets, and most importantly, state the steps you will take to achieve it. For many businesses the idea of writing a marketing plan can appear a difficult and time-consuming activity, however, to support the business plan all businesses should produce one. The investment made in devising an effective marketing plan will ultimately save time and money as it will clearly show the direction your business should take. Once your plan is complete don t abandon it, never to be looked at again until the following year. Revisit it regularly, update and adapt it as your business needs change. Getting Started Marketing plans can take many different forms, but there is a proven structure that will greatly help you shape your thinking. In this guide, we will go through the structure step-by-step, showing you how to address each section of a marketing plan. All marketing plans aim to address these three basic questions: Where are we now? Where are we going? How are we going to get there? Executive Summary This summarises the plan, setting out the key points and providing an overview of the activity required. Although it is at the beginning of the document, you could consider writing this once you have completed the plan, not least because it is a useful way of reviewing the plan one last time.

Introduction This establishes the context for the plan. It states the name of the company and describes its activities Who are you and what do you do? It also sets out the purpose of the plan, following the principle of tell them what you are going to tell them. In other words, it summarises why you are preparing this marketing plan. The Company Mission The Company Mission states why your company exists its basic purpose in a couple of compelling sentences. A Company Mission statement remains constant from year to year. Think about the reason why the company was formed in the first place. This is strategic thinking at the top level, addressing the fundamentals of your business purpose. To help you, here is the Microsoft UK Company Mission statement as an example: It started with Windows and the journey continues. Our Mission is to make Britain a better place to live, learn and trade. Together our talented people, awesome products and great partners will make IT simple, affordable and accessible, to help the people of Britain realise their full potential. The Company Vision Having established your mission, how do you see the future? Where do you want the company to be in five years time? This is clearly a crucial consideration, because the plan will set out how your vision is to be realised. The Company Goal Having established your mission and set out your vision, you can now set specific goals that will enable you to make the vision reality. These may include a target for profitability or turnover, a statement regarding plans for expansion or ideas for possible acquisitions. Examples of company goals are: Where do you want to be in terms of financial performance? How do you want to be perceived in certain market segments? What will your big achievements be e.g. number 1 in market X? Situational Analysis where are we now? Before you start thinking about the real detail within your marketing plan, you will need to take stock of the situation that your company is currently in recognising the good, the bad and the ugly where necessary. It is only when you completely review and analyse the current situation that you can start to think about the steps you need to take to grow. To ensure that you have a comprehensive overview, you may wish to consider conducting a situational analysis workshop with colleagues from various departments within your business. Earlier in this guide, we mentioned that a marketing plan will ask you to look at three core questions. The first, Where are we now? is covered within the Situational Analysis. The Situational Analysis looks at the company from an external and internal perspective, giving an overall view of the company s position. From this you will be able to write an effective marketing plan.

The Situational Analysis will help you to understand who your current customers are, how they perceive your business, your products and services and what they value most about your offerings. It also explores the structure of your customer relationships, setting out how customers buy from you. For example, do they buy direct or through a channel? You will also use these techniques to explore your competitive position and possible barriers to growth that need to be addressed. External Analysis PESTEL Conducting a PESTEL analysis (also known as PEST or STEP) helps you to understand the external influences that are effecting the economy you operate in. These are situations that you are unlikely to be able to influence, but they will help you understand the environment that businesses are currently operating in and allow you to take this into consideration within your planning process. PESTEL stands for: Political factors may include forthcoming elections or changes in government policies that may affect your business Economic factors to consider include interest rates, taxation policies, employment policies and credit availability Social factors include changing demographics, educational standards, public order and crime trends and changing attitudes towards your industry sector Technological influences might include new products or services introduced within the industry, the speed of technological evolution and the need to keep pace Environmental factors may encompass issues such as health scares, the trend towards greener business practices, concerns about climate change and the drive for greater corporate social responsibility Legal issues may include changes in specific regulations affecting your industry sector or those of your customers. Examples may be; changes in employment law or health and safety regulations, or new requirements or laws introduced by the European Community You may also see a PESTEL analysis referred to as a PEST or STEP analysis. This is exactly the same process, but with Environmental and Legal considerations omitted. External Analysis Competitor It is also vitally important to gain a real understanding of the competitive environment that your business operates within. Identify who your main competitors are and find out as much as you can about their activities. Draw up comparisons between their key capabilities and offerings and your own. Internal Analysis SWOT In this part of the plan you look specifically within your business. SWOT stands for: Strengths Weaknesses Opportunities Threats Begin with your strengths, identifying where you have the strongest competitive advantage, what your core competencies are and where you are making the most money. Then examine your weaknesses, determining where you lack resources, which areas of potential you are avoiding and where you are losing money. Your analysis of opportunities should then set out any beneficial trends in the market place, or niche

markets that competitors are failing to address. In particular, what new customer needs can you identify that can be aligned with your identified strengths? Finally, explore any possible threats to your business mission. These may include aggressive competitors attacking one of your key markets, adverse economic conditions, or technological changes that may supercede one of your key offerings. You will also see a pattern emerging within this analysis your areas of strength can be threatened and weaknesses seen as opportunities by your competitors. With this in mind, it is also wise to draw up a SWOT analysis of your key competitors to identify their areas of strengths and weaknesses and how you can align these to your areas of threats and opportunities. If you decide to run SWOT analysis against a number of competitors, consider grading each point within the analysis on a scale of 1-10 so that you can see where you perceive your competitors to be in each area. Goals and Objectives Where are we going? You are now ready to consider the Where are we going? part of the plan. It s important to understand the key difference between a goal and an objective a common mistake that many organisations make when producing their marketing plans. Goals are the end result desired, the state of affairs that a plan is intended to achieve and that determines the behaviour required to achieve it. Objectives are defined as: agreed intentions within a defined and agreed period to accomplish the company goals. Your objectives are the indicators that tell you how well you are progressing towards your goals. Within your objectives you should look to state where you need to get to and in what timeframe; as well as having specific indicators to measure whether you are being successful or not. Objectives are always SMART: SMART Specific, Measurable, Achievable, Realistic and Timed Specific Describe exactly what needs to be achieved Measurable Show how you will know that it has been achieved Achievable Confirm that the commitment and resources necessary to meet the objective are available Realistic Ensure that it is practical that the objective can be reached Timed Set out the timeframe by when the objective should be achieved Example of a SMART objective: Increase net profitable revenue for the professional services division by 15% between January 1st and December 31st, 2007 Every objective should help you achieve one or more of the following: Retain existing profitable customers Customers purchase more products, solutions or services from you Customers make larger purchases than before Win new customers Target Market Now you can begin to examine how you will achieve your objectives, starting with an analysis of your customers. You need a thorough understanding of who your customers and prospective customers are, how they interact with you and, crucially, what their own business needs are.

Segmentation is a vital tool here. You can develop more effective sales and marketing campaigns if you group your customers into segments determined by common business needs. You can then develop offerings and propositions targeted specifically at each segment. It will help to establish an understanding of your ideal customer: What size and value of business might they be? What do they do industry sector, turnover etc? What are the business needs of the customer? How do they make money? What key issues do they face? Are they located within a reasonable travel distance to support? Is it profitable to work with them? What technology do they use? What is their attitude to technology are they risk averse or early adopters? What do they think about your organisation? How would they buy from you? What prospects for future sales do they represent? Analyse your customer base against these criteria to see how close your customers come to your ideal. You may wish to consider allocating points against each criteria. Those with the highest scores are the closest to your ideal customer, and therefore most likely to generate profitable opportunities for your business. As a result, you may decide that you need to stop focusing on driving business with low scoring customer types. Also, look at the possible niche segments; are there are any groups whose needs are not currently met by competitor offerings? You may have capabilities that meet those needs, enabling you to develop new markets. The Positioning Statement This is another critical part of the plan, which often takes longer than you expect. It is, in effect, the elevator pitch, the statement that expresses what your business is about and why it is better than the competition. Your elevator pitch should ALWAYS address the business requirements of your customer so that they clearly understand the benefits for them. Remember that an elevator pitch is exactly that you need to be able to effectively get across this message in less than 30 seconds the time the average elevator ride takes! You may wish to have your elevator pitch in three versions: Verbal - 30 seconds Up to 50 words - written introduction Single paragraph - for collateral

Points you may wish to consider within your positioning statement might be: What advantage do you have to differentiate you from your competition? Unique, value, quality, reliability, speed of service, customer service Is your advantage sustainable? Strategies: How do we get there? This is where you set out the specific approaches that will ensure that your objectives will be achieved. Your areas of focus will be defined within the market segments and customer types to be targeted. What do your customers and prospects want, and what do you offer over that of your competitors? Do you need to make changes to your current portfolio? A sensible strategy would be to focus on those customer segments where you have the advantage and that are big enough to generate the required revenues. At the strategic level, you may consider approaches such as partnerships, acquisitions or mergers, if you feel they are necessary to enable you to capitalise on the opportunities you have identified as priorities. Don t forget to also look at what needs to be done internally within your organisation. You may need to recruit new people, or move teams around to focus your resources on the most productive areas. If this is the case, you must look at ways to ensure that you have secured the positivity and support of your colleagues. Tactics The tactics are your to do list - now that you understand where you are, where you need to go and how you are going to get there - all that is needed now is to put the plan into action! At this stage we are at the frontline of marketing, your tactics show the detail of how your strategies will be implemented and you re objectives achieved. There are lots of things to consider when planning your tactics all of them begin with P! The most commonly considered elements are known as the 4 Ps Product, Price, Place and Promotion. Translated this simply means what are your selling, how much are you selling it for, where will you sell it and how will you market it? In addition, there are three further Ps that you may wish to consider the People involved in selling, the Physical evidence required and the Process behind the sale. Product: You need to consider the markets for each product, in many cases your product may be the service that you are offering. Are they growing, or declining? Is there strong competition, or do you have a clear advantage in terms of price or quality? You can adapt your products, or the way they are presented, to give you the maximum advantage in each market. Price: Where do you place your product on the competitive pricing scale? There are many approaches that companies take ranging from a premium pricing approach, building on the added value and quality of their offering, right through to undercutting the competition by lowering pricing in order to drive volume sales. Place: Your offerings must be readily available when the demand comes. Place is concerned with distribution and the ways in which customers can actually purchase; whether it is direct to the customer, through a channel model or online, through mail order, or from a store or retail outlet.

Promotion: Your promotional activity, or marketing communications campaign, raises awareness of your business and its offerings and seeks to establish a positive perception of them in the minds of your customers. You will need to consider which channels of communication you will use and how to construct your messages to have the biggest impact on - and relevance to - each target group. People: The plan stands or falls on the quality of the people tasked with implementing it. You need to have people with the right mix of skills assigned to the right tasks, and with the right leaders to motivate them. This may require recruitment, or reorganisation and training. They will certainly need an internal marketing campaign to ensure that they understand the direction of the company and how it will affect them within their roles. People are a hugely important factor for success within any organisation, yet it can be easy for them to be overlooked within a marketing plan. Physical Evidence: Case studies, samples, customer testimonials and proofs of concept; are examples of the kind of supporting evidence that can help close sales by reassuring customers of the integrity and value of your offering. Process: Customers will not buy more than once if the purchasing process is difficult and the post-sales customer service is unsatisfactory. You should ensure that your sales and customer services are customer-friendly in every channel, so that customers have the confidence to do business with you again. Action Plan - making it happen Your plan will only work if you have a clear statement of the activities required to make it happen. Take each tactic within your plan and set out the budget allocated to it, with details of the people responsible for completing the activity. Include a calendar showing the activities, the targets, the deadlines and the owner assigned to each task. Results Conclude your plan with a detailed explanation of how you will measure its effectiveness. Show how much the plan will cost and what the expected return on investment will be. You can base your figures on results from previous years. Produce three scenarios to illustrate the possible outcomes, looking at the worst case, the most likely case and the most optimistic case. Show how you will respond to each scenario. Once your plan has been implemented, you will need to consider how you will monitor its effectiveness. Controls These define the criteria that you will monitor and the frequency. Setting controls will help you analyse your progress against your original objectives and enable you to determine areas of concern and, if necessary, take corrective action. Return On Investment (ROI) Monitoring the results of your marketing plan is the only way by which you will be able to measure your ROI. At a basic level, you should aim to capture the following criteria: Reach - a number of individual customers contacted Response - number of individuals responding positively Leads - number of contacts that respond with a tentative requirement Opportunities - number of customers who have a specific business need Budget allocated and timeframe for delivery Revenue realised

It is important to have a clear understanding of the difference between a lead and an opportunity or this may lead to confusion which will dilute your Return on Investment figures. Microsoft currently determines the difference between a lead and an opportunity as follows. Leads = Customer is thinking about the possibility of a new IT project but there may not yet be a budget, timescale etc therefore the first stage probability of making a sale is graded less that 20% likely to close within 12 months. Opportunities = The number of responses who have a definite project with a budget, timescale, a decision maker onboard, and is more than 20% likely to close within 12 months. It is also worthwhile tracking the media that you have used. For example, using response codes will help you identify where your responses have generated from and therefore understand the most effective marketing media. You should also take into account your marketing expenditure versus the profit realised per new sale generated i.e. cost per sale. Finally, take into account any unforeseen external factors that may have affected the success of your campaign. Review During the life of your marketing plan, it is vitally important to ensure that you review progress at appropriate intervals against objectives. Usually, the individual who is ultimately responsible for the marketing plan will review on a monthly basis to measure success and execute any additional actions required. In addition, you may also wish to review with colleagues and management at less frequent intervals, perhaps quarterly and half yearly. Whilst every effort has been made to ensure the high quality, accuracy and usefulness of the information set out in this guide, Microsoft Limited ( Microsoft ) makes no warranty, express or implied concerning such information (the Content ). Microsoft expressly disclaims all warranties, including but not limited to warranties of fitness for a particular purpose and warranties of merchantability in respect of the Content. In no event will Microsoft or its affiliates be liable for direct, special, incidental, or consequential damages (including, without limitation, damages for loss of business profits, business interruption, loss of business information or other pecuniary loss) arising directly or indirectly from your use of or reliance on the Content, even if Microsoft has been advised of the possibility that such damages may arise. Microsoft does not guarantee the accuracy, relevance or timeliness of the Content.

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