Table of Contents It’s Good to Have a Plan 2

LAP-MP-007-SP © 2016, MBA Research and Curriculum Center® A Winning Plan 1

Explain the benefits associated with having a marketing plan.

Objectives:

LAPLeadership, Attitude, Performance...making learning pay!Market Planning LAP 7 Performance Indicator: MP:007 Student Guide

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Nature of Marketing Plans

A Winning Plan It’s Good to Have a Plan

Identify the components of a marketing plan.

Put It on Paper

Why bother learning about the nature of marketing plans?

What would you do?

Table of Contents

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7

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8

Use what you’ve learned—right now!

20


Madelyn just moved to the big city and has start-ed her own small courier business. She has a small car and a bicycle and is making herself available to deliver documents and packages throughout the city. Now, she just needs to get her name out there.

A national pizza chain has decided to introduce a new barbecue chicken spe-cialty pizza. The company is currently successful in its target market, but it really wants to push this new product in the coming year.

Both Madelyn and the pizza company need marketing plans to achieve their business goals. Marketing plans organize and provide focus for a firm’s marketing strategies. Whether you want to start your own small busi-ness, or work for a big, established company, mar-keting plans are essential tools for organizational success. Learn more about marketing plans and the benefits they can provide for your business.

It’s Good to Have a Plan

What’s a marketing plan?

There’s an old saying that goes something like this: “Those who fail to plan,

plan to fail.” In other words, success is hard to achieve without putting in some

thoughtful, careful planning. This fact is especially evident in the business world.

Whether a business is just starting up or has been established for decades, it

must have a marketing plan in place to succeed.

Many different ideas and strategies must come together to form a successful marketing effort. That’s why it’s important to think carefully and plan ahead!

LAP-MP-007-SP © 2016, MBA Research and Curriculum Center®

Melpomenem/iStock/Thinkstock


A marketing plan is a set of procedures or strategies for attracting the

target customer to a business. There are three common reasons for writing

a marketing plan:

1. The marketing plan may be included as part of the organization’s overall business plan.

2. The plan may be presented to upper management by the marketing team as a way to demonstrate and solidify its goals and strategies for the upcoming year.

3. The marketing plan may outline the company’s intentions for introducing a new product, entering a new target market, or trying a new marketing strategy.

Marketing plans are also:

• Important for businesses both big and small. A small business may have one simple marketing plan, while a major corporation may have hundreds of them—one for each individual product.

• Read by a wide audience. Marketing plans may be read by marketing team members, employees in departments throughout the company, upper management, board members, potential investors, etc.

• Time-consuming. Writing a marketing plan can involve quite a bit of time, effort, and research, but your business and product have a much greater chance of success if you do the legwork first.

Check out “Free Sample Marketing

Plans” by Mplans.com to see how mar-

keting plans work for many types of

businesses: http://www.mplans.com/

sample-marketing-plans.php?a=mc#.

VmsU8vkrKUl.

iStock/Thinkstock


For your benefit

How exactly do marketing plans contribute to success in business? Here are some specific benefits your organization

can receive through the process.

The Internet makes it easier than ever to research target markets and understand customers.

Understanding past marketing decisions and

outcomes better. They say that history repeats itself.

In business, sometimes you want it to, and sometimes

you don’t! When a business creates detailed marketing

plans, it allows itself the opportunity to look back and

see which strategies worked well—and which didn’t. The

marketing team can build on its knowledge of the past

to create ideas and plans for the future and to avoid

repeating mistakes unnecessarily.

Understanding target market(s) better. The cus-

tomer is king—no firm achieves success unless it satis-

fies customers’ needs and wants. To do this, the busi-

ness must have a deep understanding of its target

market(s). The level of research and detail required to

write a marketing plan helps the marketing team to

know and understand its target market(s) as well as it

possibly can.

Setting goals. Writing a marketing plan forces the

marketing team to set specific goals. When goals are

put in writing, they are easier to remember, to stick to,

to measure, and to achieve.

Jacob Ammentorp Lund/iStock/Thinkstock


Planning marketing strategies with more precision. Once marketing goals have been set, marketing strategies must be

designed and implemented to achieve those goals. Without a marketing plan, things can get chaotic. One member of the team may

plan a television advertising campaign, while another sets sales promotions into action, and yet another runs social media cam-

paigns—without coordination, these marketing strategies can compete with each other and create confusion among customers.

A marketing plan provides clear guidance on what strategies will be used, by whom, and when.

Obtaining funding. A very important benefit of writing a marketing plan can be obtaining funding for specific products or projects.

This funding might come from within the company or from outside investors. For example, large companies often have different

marketing teams for each of their specific products. These teams might have to compete to get the funding they want out of each

yearly budget—and a well-written marketing plan can be the key to obtaining it. A small business, on the other hand, might need

investment dollars to get off the ground. A marketing plan, as part of an overall business plan, is something that potential investors

will want to see before deciding whether or not to put money into the business.

Often, marketers must present their plans in order to obtain funding. A well-done plan should demonstrate the importance of investing in marketing efforts—and help the presentation run smoothly!

A Winning Plan 5

vitchanan/iStock/Thinkstock


Providing direction for everyone in the organization. Marketing plans

provide clear direction for everyone in the organization, both inside and

outside the marketing team. All company departments are interrelated. Can

you see why sales representatives, accounts payable clerks, and shipping

supervisors would all need to know what’s in the marketing plan? When

everyone in the organization is informed, it’s easier to stay on track.

Tracking progress more effectively. It’s hard to gauge the effective-

ness of marketing when no specific objectives have been set. A well-written

marketing plan allows a business to track its progress in a measurable way.

Being able to demonstrate success can be essential for obtaining further

funding or getting the go-ahead to continue with certain products or

marketing strategies.

iStock/Thinkstock

Summary

A marketing plan is a set of procedures or strategies for attracting the

target customer to a business. Writing a marketing plan can have many

benefits for a business, including understanding past marketing deci-

sions and outcomes better, understanding target market(s) better, set-

ting goals, planning marketing strategies with more precision, obtaining

funding, providing direction for everyone in the organization, and tracking

progress more effectively.

The video “The Importance of a Marketing

Plan in Generating Results” demonstrates

a real-life example of a marketing plan

in action: https://www.youtube.com/

watch?v=HXmr-0b_r9k.

1. What is a set of procedures or strategies for attracting the target customer to a business?

2. What types of businesses use marketing plans?

3. Whatarethebenefitsofwritingamarketingplan?

https://www.youtube.com/watch?v=HXmr-0b_r9k


Put It on Paper

Not every marketing plan looks exactly the same. Different organizations have different needs, types and numbers of products, and

audiences. Therefore, marketing-plan formats may vary from business to business. Most marketing plans, however, will include the

following sections.

Executive summary. The executive summary serves as an introduc-

tion. It allows the reader to understand the purpose of the marketing

plan. It should include:

• Background information on the organization, for those readers who may not be familiar with the company

• The organization’s mission statement

• A brief introduction to the organization’s management team and/or the marketing management team

• A brief review of the plan’s highlights and objectives

Although the executive summary may be short compared to other sec-

tions of the marketing plan, its importance should not be underestimated.

For many readers, this is the only part of the marketing plan that they

will take the time to read. Many important decisions may be made based

solely upon the information contained in the executive summary. For this

reason, the summary must clearly and concisely state the purpose of the

marketing plan.


Experts tend to disagree on when the executive summary should be written. Traditionally, it has been written after the

rest of the marketing plan, as a summary, then positioned at the beginning of the document. Some experts, however,

recommend writing the executive summary first, as an outline for the rest of the plan. No matter what the authors decide,

the executive summary must sell the marketing plan to the reader, and it must include all the major highlights from the

body of the plan.

You’re on the marketing team for a product made by a big company that also makes hundreds of other products.

To get the money you need out of the budget this year, your marketing plan has to wow those in upper manage-

ment. In the financial plans section of your document, one of your team members has overestimated the expected

revenues your marketing programs should bring in. He explains to you that he has not fudged the numbers too

much, just enough to give your team the edge for the budget money it needs. He tells you that overestimating is

not exactly lying, and it’s all right to round up because your team really needs funding for its marketing programs.

What do you think? Is it okay to inflate the numbers a bit if you believe it will help the company in the long run, or

is it unethical?


Situation analysis. In a marketing plan, situation analysis is the determination of a firm’s current marketing situation.

It answers the basic question “Where do things stand right now?” and serves as a snapshot of the business’s current state

of affairs as related to marketing.

Situation analysis is an important and time-consuming component of a marketing plan. It covers the following key areas,

which are sometimes referred to as the 5 C’s.

• Company (the organization itself)

♦ What are the company’s overall goals?

♦ What is the company’s organizational culture like?

♦ What goods and services does the company currently produce?

♦ What are the features and benefits of the company’s goods and services?

♦ What makes the company unique?

♦ What is the company’s current financial situation?

• Customers (target market)

♦ What is the size of the company’s current target market?

♦ What are the demographics (defining characteristics) of the current target market?

♦ What are the purchasing behaviors of the current target market?

A Winning Plan 9olm26250/iStock/Thinkstock


Understanding the competition is essential to achieving success.

• Competitors

♦ What is the market position of the company’s main competitors?

♦ What are the strengths and weaknesses of the company’s main competitors?

• Collaborators

♦ How strong are the company’s relationships with its current distributors?

♦ Does the company currently have any subsidiaries or joint ventures? If so, how do these relationships affect the company’s current marketing situation?

• Climate (external factors): How are the following trends affecting the company’s current marketing situation?

♦ Social and cultural

♦ Demographic

♦ Economic

♦ Technological

♦ Political and legal

linetic/iStock/Thinkstock


iStock/Thinkstock

Some marketers choose to summarize this

section of the marketing plan with a SWOT

analysis chart. This is a chart that lists the

strengths and weaknesses in a company’s

internal environment, as well as its external

opportunities and threats. Using a SWOT

chart can be an effective way to illustrate

the conclusions drawn in the situation

analysis section of the plan.

To see an example of a SWOT

analysis chart, check out “SWOT

Analysis Examples for Every

Business Situation” by Jim Makos:

http://pestleanalysis.com/swot-

analysis-examples/.

Zoonar RF/Zoonar/Thinkstock


When entering a new target market, it is important to carefully research demographic information, such as median income, that might impact marketing strategy.

Desired target market. Next, the marketing plan should include information on the target market the company desires to reach.

If the plan is not written for a new target market or a new product, it may not need to include this particular section. For example,

Madelyn’s courier business targets other small businesses (having 50 or fewer employees) in the city. She provides information about

this target market in the situation analysis portion of her plan—she does not need to repeat it here. However, for a bigger company

entering a new target market or introducing a new product, further information will be needed.

robuart/iStock/Thinkstock


r_a_v_e_n22/iStock/Thinkstock

This section of the marketing plan should include a full demographic description of the target market and should provide

answers to questions such as:

• What does our target market want and need?

• How will our target market use this product?

• How much will our target market be willing to pay for this product?

• What message do we want our target market to hear from our marketing efforts?

• How do we want to position our brand to the target market?

Marketing objectives. This section of the marketing plan outlines the

specific marketing objectives that the company wants to achieve. Keep

in mind that marketing objectives serve as a foundation for achieving

sales and overall financial objectives as well. Setting marketing objectives

is a very important task!

Like any effective goal, a marketing objective should be SMART—specif-

ic, measurable, achievable, realistic, and time-bound. It’s not enough to

say, “We want our target market to love our new product.” The objective

must have more focus. For example, how much market share does the

organization want to achieve? By what date?


Tracking financial markets can help you foresee changes in the economy that could affect your marketing strategy.

There are many different types of marketing objectives that a company can set for itself. They can relate to issues including target

markets, promotions, channels of distribution, and even the research and development of new products. A marketing plan may

even include different sets of objectives for different groups within the same target market. A company may set different goals for

reaching new customers, for instance, than it does for reaching existing customers.

Marketing strategies and programs. Here is the heart of the marketing plan. This is usually the longest section of the plan, tak-

ing up 50 percent or more of the overall length. The plan’s authors may start out by identifying a general marketing strategy, such

as growth (i.e., obtaining a bigger market share), stability (i.e., keeping the same market share), or market exit (i.e., taking a

product off the market before introducing a replacement).

DragonImages/iStock/Thinkstock

The marketing objectives section also mentions any issues that might affect the organization’s ability to

reach its goals. Examples of these types of issues include a competitor coming out with a similar product

or a predicted downturn in economic activity. The plan should address how the organization will overcome

these obstacles with its marketing programs.


The marketing strategies and programs section then details the specific marketing

activities that the plan proposes to undertake. This includes schedules, timetables,

and the assignment of responsibility for all the tasks involved in:

• Product

♦ Branding

♦ Variety

♦ Features

♦ Benefits

♦ Quality

♦ Warranty

♦ Packaging

♦ Labeling

For example, a large corporation such as Procter & Gamble may want to introduce a

new brand of anti-chlorine shampoo formulated specifically for frequent swimmers.

The marketing plan will cover all aspects of the product itself—its name, its special

ingredients, what it will look like, etc.


• Price

♦ List price

♦ New product pricing

♦ Bundling

♦ Discounts

♦ Price competition

♦ Credit terms

♦ Payment periods

♦ Leasing options

Procter & Gamble’s marketing plan for its new shampoo brand will include specific details about price. How much will

it cost? Will the company issue coupons to encourage customers to buy the new product? For big-ticket items such as

cars or computers, a marketing plan will likely include detailed information about credit terms and payment periods

offered to customers. Remember, marketing strategies and programs are key to achieving sales and financial goals,

so price decisions are very important!


• Place (Distribution)

♦ Channel members

♦ Locations

♦ Inventory

♦ Coverage (how widely the product will be distributed)

♦ Transportation

♦ Warehousing

♦ Order fulfillment

How will Procter & Gamble get its new shampoo into the hands of its target market? Which wholesale

and retail intermediaries will it choose to become channel members? How much of the new product

will be produced in the next quarter or year? All these questions will be answered in this section of

the marketing plan.


• Promotion

♦ Advertising

♦ Sales promotions

♦ Public relations

♦ Personal selling

♦ Direct marketing

♦ Internet marketing

The marketing plan must detail what promotional activities will be undertaken. For example,

Procter & Gamble is targeting frequent swimmers with its new anti-chlorine shampoo. It might

plan to advertise at aquatic centers or during the television commercial breaks of the Summer

Olympic Games. The company might also plan sales promotions for members of high school and

college swimming and diving teams. Depending on the size of the company, marketers might

complete a separate plan to outline, schedule, and budget specifically for promotional activities.


iStock/Thinkstock

Financial plans. This section of the marketing plan provides details on the expected expenses and profits of the plan’s programs.

How much will each specific marketing program or project cost? What are the projected revenues for each program? It’s all outlined

here, in detail.

Performance and implementation. In this section of the

plan, marketers explain their expected results and indicate

how the marketing plan’s progress will be measured. This por-

tion also describes potential changes and adjustments that can

be made to keep the marketing plan on track.

Appendix. The appendix includes any charts, graphs, or

miscellaneous materials related to the marketing plan. It might

include detailed research findings that are only summarized in

other parts of the plan, samples of proposed marketing litera-

ture, press clippings, product photographs, estimates from

vendors, etc.

Careful planning—in the form of a well-researched, well-

written marketing plan—can mean the difference between

your business’s success or failure. Take the time to do it

right, and then reap the rewards of your hard work.

The video “Marketing Plan: How to Get Started” by Soma Jurgensen provides a detailed

walkthrough that applies the concepts of a marketing plan to real-world examples:

https://www.youtube.com/watch?v=_lo4-GOADVY.

Charts and graphs provide visual representation that can supplement information in other parts of the marketing plan, making it engaging and easier to understand.

Nednapa/iStock/Thinkstock


Think about a local business in your community, whether it be a restaurant, bookstore, coffee shop, or clothing

boutique. Do you think this business has a marketing plan? Why does this business need a marketing plan? What

areas of the marketing plan do you think are most important for this business? Can you see the effects of the mar-

keting plan in action? If so, how? If the business did not have a marketing plan, do you think it would still be able to

keep running? Why or why not?

Summary

Each marketing plan is unique, but a general

plan includes the following sections: executive

summary, situation analysis, desired target mar-

ket, marketing objectives, marketing strategies

and programs, financial plans, performance and

implementation, and appendix.

1. Describe the following parts of a marketing plan:

a. Executive summary

b. Situation analysis

c. Desired target market

d. Marketing objectives

e. Marketing strategies and programs

f. Financial plans

g. Performance and implementation

h. Appendix

Table of Contents It’s Good to Have a Plan 2

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