A Killer Marketing Plan Essay

If you are the founder of a new startup or an existing business it’s highly recommended that you develop a roadmap that will get you from where you are today to where you want to be tomorrow, six months from now, or a year or longer down the road. The roadmap is a guide to help you overcome roadblocks, prevent costly mistakes and eliminate time-consuming detours that can prevent you from attaining your goals, and reaching your ultimate destination. We typically refer to this roadmap as a marketing plan. A marketing plan should be a formal written document, not recalled from memory or something scribbled on a napkin. To take your business to the next level requires preparing a written marketing action plan. There are 12 recognized marketing planning models in use today. The Top 5 most popular marketing planning models include: * 7 P’s Marketing Matrix – The seven elements of the marketing mix: Product, Price, Place, Promotion, People, Process and Physical evidence , form the core tactical components (see below) of the marketing plan. * Segmentation, Targeting and Positioning – This three stage process involves analysing which distinct customer groups exist and which segment the product best suits before implementing the communications strategy tailored for the chosen target group. * SOSTAC ® – This acronym stands for Situation, Objectives, Strategy, Tactics, Actions and Control and is a very popular classic marketing planning framework for creating marketing plans. SOSTAC is more comprehensive and borrows elements of several of the other popular marketing planning models. * Ansoff’s Growth Strategy Matrix – Ansoff’s Growth Strategy Matrix identifies alternative growth strategies by looking at present and potential products in current and future markets. The four growth strategies include: market penetration, market development, product development and diversification. * Porter’s Five Forces – In a blog post dated November 21, 2011, I covered Michael E. Porter’s Five Forces marketing planning model. The Five Forces are Rivalry, Supplier Power, Threat of Substitutes, Buyer Power and Barriers to Entry and are used to analyse the industry context in which the organisation operates. Porter’s Five Forces are required reading in any graduate course on Marketing or Strategic Planning. For my money, the SOSTAC ® marketing planning model is the model I use the most when developing marketing plans. First, let’s begin by defining what SOSTAC is: What is SOSTAC ®? SOSTAC ® is a marketing planning model, originally developed in the 1990s to help with marketing planning by PR Smith, who together with Dave Chaffey co-authored Emarketing Excellence. SOSTAC ® stands for: * Situation – where are we now? * Objectives – where do we want to be? * Strategy – how do we get there? * Tactics – how exactly do we get there? * Action – what is our plan? * Control – did we get there? SOSTAC has been used to develop marketing plans for a broad range of industries. Here’s how SOSTAC is used to summarise the main issues to consider within a digital marketing strategy: You can see it gives a logical order for tackling your plan (with iterations) and a great way to summarise the main elements of each. Why is SOSTAC ® useful? SOSTAC ® has become very popular since it’s simple, easy to remember and covers all the main issues which you need in a marketing plan or business plan. Tips for using SOSTAC ®Ã‚  Here are some tips on how to use SOSTAC ® based on Chaffey’s experience applying the model in companies and in academia. 1. Use SOSTAC ® to review your process – Before looking at how you apply SOSTAC ® at each step to create a marketing plan, use it to review your planning process and how you manage your marketing. Ask yourself what you and your organisation are good at. Maybe you spend too much or too little time reviewing the situation. Perhaps you’re not so good at setting SMART objectives, or developing strategies to support them or the control stage of assessing how effective your strategies and tactics are and adjusting them? 2. Get the balance right across SOSTAC ® – Oftentimes, there is too much time spent on analysis within a plan and not enough on setting the strategies. So as a rule of  thumb, this is how your balance of content could look: Situation Analysis (20%), Objectives (5%), Strategy (45%) and Tactics (30%) = 100% 3. Summarise your Situation in a SWOT Analysis – To give focus to your situation analysis it is recommended that you utilize this form of SWOT analysis. This helps integrate SWOT with strategy. I also recommend that you read my blog post dated November 29, 2011 on how to prepare a SWOT analysis to plan for the future of your company. 4. Make your goals SMART and link them to your analytics/control process – Since digital marketing is so measurable, it makes sense to be specific as possible about your goals by developing a funnel conversion model. You should also setup specific goals in Google Analytics. But it’s worth thinking about the full range of goals indicated by the 5Ss. 5. Integrate the different elements of your SWOT Analysis – Oftentimes in a plan or report there isn’t good flow relating sections. To help this I recommend summarising your entire SOSTAC ® plan within a table. It’s important to note that a marketing plan can be for a product (the iPhone), a series of similar products (e.g. mobile devices) or an all-encompasing plan for a company. General Rules For Creating A Killer Marketing Plan There is no shortage of general rules for developing marketing plans, but if you want to create a killer marketing plan I have found that the following general rules work the best: * Stay focused – Don’t try to â€Å"boil the ocean† by going overboard or overstate the case with too many ideas, products or services. Know what your core business is going to be. Focus on one product or service at a time. * Where Are You Today – You must know where you are today in order to develop a roadmap to where you want to be in the future. * Keep Things Simple – Less is better. Avoid long sentences. Be brief. Avoid geeky tech terminology and acronyms. Use bullet points. Embellish with graphs, charts and images. * Be Realistic – Set realistic and measurable goals. Don’t try to conquer the world. Set goals that you can reasonably accomplish. * Know Your Strengths and Weaknesses – Take an inventory of your individual and management teams strengt hs and weaknesses. * Do Your Homework – Before you do anything do your research. Know your market, your ideal customers, market niches, your competitors, latest trends,  barriers-to-entry, methods of opeation, distribution channels, pricing models, and promotions and advertising methods used in the industry. The Key Steps To Develop A Killer Marketing Plan Using SOSTAC ® For large corporations it is not too unusual to see 100 page marketing plans. For a small startup, a marketing plan should be between 10-15 pages in length including graphs, charts and tables. The Apple iPhone launch marketing strategy provided above is a great example. Before you start preparing your marketing plan make sure that you have completed sufficient market research to determine if your idea, product or service is viable given all that you know about the marketplace you are entering. Situational Analysis – Where are we now? This is where you take inventory of where you are right now. I recommend that you conduct your market research before you prepare your marketing plan. The Situational Analysis should include the following: * Product or Service – Describe the product or service in simple terms. Describe the market need filled or problem your product or service solves. Identify the total value proposition your produce or service offers customers. * Market and Competition – Describe the type, size and geographic location of the market in which your product or service will compete, competitive landscape including the number of competitors, major competitors, direct competitors, market shares, market niches, stage of development and market trends. * Target Customers – Identify the individuals or organizations (â€Å"target market†) and customer segments you are targeting. In some cases, you may have more than one target market. Determine the following: * Who needs your product or service and why? * What is the profile of your ideal customer and what are their attributes? * How many potential customers are there? * How many different customer niches are there? * Is the target market or market niches underserved? * Describe your customers by their shared characteristics for individuals and organizations. * Individuals – Describe them by demographics: age, income, geographic location, and lifestyle. * Organizations – Describe them by number of employees, sales, geographic location,  and industry. * SWOT Analysis – Identify your competitive strengths and weaknesses, business opportunities and potential threats. Arrange your strengths, weaknesses, opportunities and threats into a four-quadrant grid like the one below: The purpose of a SWOT Analysis is to help you build on your business’ strengths, minimize and correct the weaknesses, and take the greatest possible advantage of potential opportunities while formulating a plan to deal with potential threats. Think of a SWOT Analysis as a checkup for your business. Be honest with yourself, if you lack a strong marketing and sales team, list it as a weakness. I also recommend that you read my blog post datedNovember 29, 2011 on how to prepare a SWOT analysis to plan for the future of your company. * Management Team – List the key members of your present management team and very brief description of their business and industry experience and education. If you believe you will need to add key individuals to the management team list their position, title and duties. * Milestones Accomplished – Elaborate on significant milestones that have accomplished to date. Include major new customers, revenues, no of unique visitors, downloads, new patents, major personnel additions and awards. Objectives – Where do you want to be? * Goals and Objectives – Set realistic goals and objectives. Make sure your goals and objectives are measureable and achievable. Measure them against your own efforts and abilities, not your competitors. There are two types of goals and objectives: * Quantitative – Those with specific, measurable results and numbers. * Qualitative – Those that increase value, like improving image or visibility. Strategy – How do we get there? Your marketing strategies answer the big question: HOW do you get from where you are today to where you want to be tomorrow? Be creative and brainstorm with your team. Don’t think in terms of what other organizations or individuals have done, but how you are going to get it done. Your marketing strategies should include the following: * Core Marketing Message – Your core marketing message is a short description of your business, products and services, employees, core values, business philosophy, mission and value proposition you bring to the customer  relationship. Your core message should project what makes you unique and be conveyed in a manner that instantly connects with your ideal customers. * Define Your Brand – Your brand isn’t just your corporate identity like your logo, tag line, motto or its visual associations such as unique design, colors or packaging, but the relationship you have with your customers. Your brand’s value proposition in cludes everything you have promised your customers: quality products, great prices, better selection, great service, more locations, moneyback guarantee, free delivery, etc. * Positioning Statement – How you intend to position your company in the marketplace. Will you compete on the basis of differentiation (e.g. technology leader, quality, durability, broad selection, etc.), target a specific market niche (e.g. Affluent, professionals, SMB’s, management, etc) or compete on the basis of price (e.g. luxury, premium, medium, bargain or low price). Explain why you have chosen this particular market position. * Business Model – According to Peter Drucker, the late Harvard management guru, â€Å"A business model is nothing else than a representation of how an organization makes (or intends to make) money.† But, a business model is far more than this. Mark W. Johnson, the Harvard professor and author of â€Å"Seizing The White Space,† says that a business model consists of three components: 1) It identifies an important job a customer needs to get done and then proposing an offering that fulfills that job better than any alternative the customer can turn to–in short, the customer value proposition (CVP), 2) A pricing model and profit formula that shows quantitatively that you can make a profit delivering on the CVP, and 3) You can identify which company resources and which processes are essential to delivering the CVP. To develop your business model I highly recommend that you read my blog post dated November 5, 2011, January 26, 2012, and February 26, 2012. * Pricing Model – Describe the methodology you will use to set prices for your products and services. Prices should reflect competitive factors, economic conditions, nature of the market and how you intend to position yourself in the marketplace. Pricing should take into account fixed and variable costs associated with each product or service, so that you can generate a sufficient gross profit. Prices and profit margins should be determined by distribution channel. Describe if you will use different price levels depending on quantities ordered and type of customer. * Launch Strategy  Ã¢â‚¬â€œ Describe your go-to-market strategy for your product or service. Describe when, the method used to announce your market entry, and how you will manage your market entry during the first 30-to-90 days. * Distribution Strategy – Describe the distribution channels you will utilize to get your product or service to your target market (e.g. direct-to-consumer, ecommerce, retail stores, dealers and distributors, infomercials, mail order catalog, direct mail, email, etc.) and specific reasons you are using each channel. * Sales Strategy – Describe who is actually going to sell your product or service. Will you be using inside sales personnel, inbound or outbound sales personnel, outside sales personnel, manufacturer’s representatives, independent salespeople or network marketing personnel. * Advertising and Promotions Strategy – Determine what media channels you will use to market and promote your products and services to your target market (e.g. print ads, television, radio, direct marketing, ecommerce, social media and events). The types of media channels you will use will depend on your unique requirements, budget constraints, and practices within your industry. * Public Relations Strategy – Describe the methods you will utilize to inform, communicate and educate your public (e.g. customers, media, vendors, academia) about your company and its products and services. * Strategic Alliances – Describe the nature and type of third-party alliances you anticipated will be needed in order to compete effectively in the marketplace. * Word-of-Mouth – Describe how and the methods you will utilize to create word-of-mouth. A few final pointers about developing marketing strategies: * Think strategic first – Too many individuals believe that the marketing tactics — the newsletters, press kits, trade shows, banners, 800-numbers, display advertisements, logos and giveaways — comes before the marketing strategies. Those promotional, publicity and advertising tactics should be contained within a well-orchestrated marketing action plan. But first create your marketing strategy items that will generate leads, build awareness and enhance credibility. * Make the first the last. The executive summary consists of a one-page, top-level summary of the entire marketing plan. It’s placed at the front of the document, but it’s the last thing you’ll write. Its purpose is to convey the gist of the plan to stakeholders,  investors and anyone else who needs to know these facts in a hurry: * The scope of the plan in an outlined paragraph. * The product or service being marketed. * For whom the plan is being prepared. * The time period the plan covers. * The geographic area where the implementation occurs. * The strategic messages and the tactics to get them to the target markets. Tactics – How exactly do we get there This is where you list the specific action steps or programs to achieve each marketing strategy (see above). If you are going to use billboards to advertise your product, indicate the name of the outdoor advertising company, the number of billboards, their geographic locations, cost per billboard and total amount. If you will be conducting focus groups to conduct market research and get feedback about your product, indicate the name of the research firm, dates focus groups will be conducted, cost per focus group and total amount. You should include deadlines and key dates for executing all of your marketing activities. * Media Tactics – If you will invest in different types of media to communicate your core marketing message and product or service offering divide your media into paid, non-paid and non-traditional media. * Paid media: direct mail, newspaper, radio, TV, billboards, direct sales. * Non-paid media – Referred to as public relations because it is exposure through traditional media without paying for advertising in that media. * Non-traditional media: includes everything else — sponsorships, ad specialties,shows/events, electronic media and the Internet. Action – What is our plan? Your business model is the one piece of the marketing plan that puts it all together for you. In a blog post dated February 6. 2012, Floodgate Fund co-founder Ann Muira-Ko says, â€Å"Its the business model that matters the most, rather than the business plan.† According to Miura-Ko, business models do a better job of unearthing assumptions about a company’s users, customers, pricing, demand creation, sales channels, supply chain, and overall logistics – all critical components to building a successful business. A business model answers all the 4 W’s (Who, What, Where and  Why) and the all important How you are going to do it as it relates to the following: * Core marketing message. * Components of your brand identity. * Customer value proposition (CVP). * Industry or market. * Target customers. * Competitive landscape. * Industry life cycles. * Pricing model. * Value chain. * Operations. According to Peter Drucker, the late Harvard management guru said. â€Å"A business model is nothing else than a representation of how an organization makes (or intends to make) money.† But, a business model is far more than this. Mark W. Johnson, the Harvard professor and author of â€Å"Seizing The White Space,† says that a business model consists of three components: 1. It identifies an important job a customer needs to get done and then proposes an offering that fulfills that job better than any alternative the customer can turn to–in short, the customer value proposition (CVP). 2. A pricing model and profit formula that shows quantitatively that you can make a profit delivering on the CVP. 3. identifying which company resources and which processes are essential to delivering the CVP. Use the Business Model Canvas (see below) to guide you in the preparation of your business model provides the answers to the four W’s and the How. The business model canv as is divided into nine grids: * Strategic partners. * Key activities. * Value proposition. * Customer relationship. * Customer segment. * Key resources. * Distribution channels. * Costs. * Revenues. The Business Model Canvas (Click Image To Enlarge) To develop your business model I highly recommend that you read my previous blog posts dated November 5, 2011, January 26, 2012, and February 26, 2012. Control – Did we get there? Establishing a marketing budget allows you to establish quantitative goal and measure actual performance against those goals. Here’s how a marketing budget can help assist you manage, control and measure the return-on-investment (ROI) from the execution of your marketing plan: * Marketing budgets allow you to put a quantitative value to every strategy, tactic or program built into your marketing plan. * Marketing budgets allow you to establish specific budget line items, including sales and related marketing expenses. * Marketing budgets allow you to evaluate and make the best marketing decisions. * Marketing budgets place a cap on every budget line item forcing you to work within those budget constraints. Having a marketing budget in place allows you to evaluate marketing decisions such as advertising in the yellow pages, hiring sales reps or conducting a PR program based on the amount of business a particular initiative generates. Track each initiative and evaluate what worked, what didn’t. Marketing budgets should be established by month, quarter and year so that you can gauge your performance and make adjustments to insure you are within budget. This allows you to determine if you are meeting your stated quantitative goals monthly, quarterly and yearly. Sample Marketing Plan Budget Here’s an excellent of an annual marketing plan budget for a software business: Click Image To Enlarge Apple’s iPhone Launch Marketing Strategy Analysis Example Here’s a great example of the Apple iPhone launch marketing strategy by Borislav Kilprin: Apple’s iPhone Launch Marketing Strategy Analysis View more documents from Borislav Kiprin I often use Steve Jobs’ â€Å"Digital Hub Strategy† (see my blog posts dated August 31, 2011 and January 20, 2012) for inspiration and as a great  example of a grand vision and all-encompasing marketing strategy for a company. On January 9, 2001, Steve Jobs gave a great presentation at MacWorld where he introduced the public to the concept of the Digital Hub, when he said that the PC was not dead, but was evolving. Steve Jobs declared that the Mac would become â€Å"the digital hub for the digital lifestyle,† an emerging digital trend driven by the internet and an explosion in digital devices: digital camera’s, videocam’s, portable music players, PDA’s and DVD video players. Steve’s idea was to use the Mac as a way to add value to those devices by making them more useful by allowing users to share digital files and be able to combine text, images, video and sound to heighten the overal digital experience. Steve Jobs’ 7 Success Principles When you stop and analyze the Digital Hub Strategy you will discover that Steve Jobs’ 7 Success Principles are evident everywhere: * Do what you love. Steve Jobs once told a group of employees, â€Å"People with passion can change the world for the better.† Jobs has followed his heart his entire life and that passion, he says, has made all the difference. It’s very difficult to come up with new, creative, and novel ideas unless you are passionate about moving society forward. * Put a dent in the universe. Passion fuels the rocket, but vision directs the rocket to its ultimate destination. In 1976, when Jobs and Steve Wozniak co-founded Apple, Jobs’ vision was to put a computer in the hands of everyday people. In 1979, Jobs saw an early and crude graphical user interface being demonstrated at the Xerox research facility in Palo Alto, California. He knew immediately that the technology would make computers appealing to â€Å"everyday people.† That tec hnology eventually became The Macintosh, which changed everything about the way we interact with computers. Xerox scientists didn’t realize its potential because their â€Å"vision† was limited to making new copiers. Two people can see the exactly the same thing, but perceive it differently based on their vision. * Kick start your brain. Steve Jobs once said â€Å"Creativity is connecting things.† Connecting things means seeking inspiration from other industries. At various times, Jobs has found inspiration in a phone book, Zen meditation, visiting India, a food processor at Macy’s, or The Four Seasons hotel chain. Jobs doesn’t â€Å"steal† ideas as much as he uses ideas from other industries to inspire his  own creativity. * Sell dreams, not products. To Steve Jobs, people who buy Apple products are not â€Å"consumers.† They are people with hopes, dreams and ambitions. He builds products to help people achieve their dreams. He once said, â€Å"some people think you’ve got to be crazy to buy a Mac, but in that craziness we see gen ius.† How do you see your customers? Help them unleash their inner genius and you’ll win over their hearts and minds. * Say no to 1,000 things. Steve Jobs once said, â€Å"I’m as proud of what we don’t do as I am of what we do.† He is committed to building products with simple, uncluttered design. And that commitment extends beyond products. From the design of the iPod to the iPad, from the packaging of Apple’s products, to the functionality of the Web site, in Apple’s world, innovation means eliminating the unnecessary so that the necessary may speak. * Create insanely great experiences. The Apple store has become the world’s best retailer by introducing simple innovations any business can adopt to create deeper, more emotional connections with their customers. For example, there are no cashiers in an Apple store. There are experts, consultants, even geniuses, but no cashiers. Why? Because Apple is not in the business of moving boxes; they are in the business of enriching lives. Big difference. * Master the message. Steve Jobs is the world’s greatest corporate storyteller, turning product launches into an art form. You can have the most innovative idea in the world, but if you can’t get people excited about it, it doesn’t matter. Apple’s Five Key Pillars For Product Success When you dig down into the roots of the Digital Hub Strategy it is all about the product. I have identified five key elements or pillars of strength that have been important in Apple’s product successes: * Creating products that disrupt existing industry paradigms. * Creating products that Apple engineers themselves would love to use. * Creating products that customers don’t know they need yet. * Creating elegant, simple and minimalist products that â€Å"people will lust for.† * Controlling every aspect of the product, including the design, engineering, intellectual property, components, operating systems, applications software, manufacturing, distribution, customer service, advertising and pricing. The Digital Hub Strategy has endured the test of time and every new product  launched by Apple represents a â€Å"spoke† in the Digital Hub. In essence, the Digital Hub Strategy has not only become Apple’s core business strategy, but also its grand vi sion.