Business Success Starts with a Marketing Plan
Here you are with a strong desire to start a business on your own. You have some ideas and some financial resources, but what’s the next step to business success? Of course, there is the legal requirement for licensing and registration of the business, but that is only a formality.
- Should you write a strategic plan?
- Should you buy or rent a building?
- Should you buy a sign and business cards?
Let’s consider developing a marketing business success plan first
The term “marketing” is widely misunderstood in the business world. Many people are surprised when they realize how many ideas and activities are included in the term marketing. It’s more than advertising. It’s more than sales. It’s the totality of the business and how it relates to the community and its customers. It is your plan for business success. It starts with developing an understanding of who your customers are, what they need, and what they want. It’s followed by matching the product, its pricing, promotion, and placement to satisfy those customer wants and needs. It is the key to business success.
A marketing plan which leads to business success consists of four parts;
- Define and understand the target market
- Create a marketing mix which satisfies the needs of the target market
- Develop a marketing strategy
- Implement the strategy with a marketing plan.
The Target Market For Business Success
A simple technique to understand your customers is to define a target market. On too many occasions, when you ask a new business person to define their target market, they respond by saying, “everybody”. That response indicates a business person with great enthusiasm, but one that needs to count on good luck to succeed. Consider the following general questions:
- Where are your potential customers located? (a local town, a local county, your state, national wide, internationally)
- What are their age range, income level, sex, ethnicity, and marital status?
- What are their interests, such as golfers, boaters, readers, sports fans, gardeners, etc?
- What are their occupations or professions, such as doctors, carpenters, engineers, accountants, business owners, etc?
- In the adoption of new technologies and products, are they innovators, early adapters, the majority or laggards?
The questions above and perhaps others develop those items by which the market segment is defined and are referred to as its dimensions.
Once the dimensions are established there are two important questions which will drive business success.
- What are the “needs” of those in this market segment? Needs may be economic such as available income to make the purchase. Needs may be functional in that, “I need a hammer to build a house.” Needs may be psychological in that,” I need a new luxury car so my friend appreciate my success in business.”
- What wants might be developed within those in the market segment?Wants are learned needs. We did not know we needed a “smart phone” until, through advertising or word of mouth, we learned about their great advantages. I had no need for a Nook, until I learned about it and its features.
The Marketing Mix for Business Success
The marketing mix is those elements which you as a business owner or manager control. They are Product, Promotion, Place and Price. Your business success depends on how well you structure each one of those elements to satisfy the wants and needs on the defined target market.
Let’s consider how a product or service can be structured to satisfy the wants and needs of a target market. This may be best done through example. The target market is the business community. The need is to get a package delivered the next day with certainty. FEDEX service is that guaranteed delivery with electronic tracking at every step of the way. A need has been satisfied. The second target market is middle income families with young children who are traveling on vacation. The need is to find a place to have lunch thar the children will enjoy and will not take much time form the traveling day.McDonalds satisfies that need with its “happy meals” and playground areas.
The second element in the mix is promotion for business success. It not only includes the various forms of media advertising and publicity, but personal selling and sales promotion. With advertising and publicity the key question is how to reach your target market individuals. One example of this being done well is the advertising on the 6:00 PM major network news. If you ask a group of younger people where they get their news, very few will say watching the 6:00 PM news. But baby boomers grew up watching the 6:00 PMHuntley/ Brinkley and Walter Cronkite programs after dinner on TV. Now, decades later, those habits continue and that leads to the nature of advertising on those programs.
Products advertising promote the cures from the pain of arthritis, or an over active bladder, or other concerns of those over 60 years of age. The issue with personal selling is the need to develop a personal relationship with those in the market segment. This is important in the sale of real estate, but not so important in the sale of beer. Promotion is a area which needs careful consideration and a close control of cost for business success.
Place is the third element. In many cases, the decision on the place at which we deliver our product or service is a simple one. If I have a landscape business, I will deliver my service at your house. If I am a dog groomer, I may deliver my service in my office or at your house. If the product is a wide screen television the place of product delivery may be an electronic retailer or department store. The place decision also includes the method of delivery and distribution channel. A book may be purchase on the internet and shipped to the buyer the same day by UPS. The same book may be sent form the publisher to a wholesaler, who in turn ships it to a book store where the customer comes to make the purchase. The question is where the customer prefers to receive the product and how to make that economically feasible.
Price may seem to be the simplest element to consider for business success, but it’s not. The first consideration is setting a level of pricing that those in a target market will accept. Those in the luxury car market will accept a different level of price from those in the economy car market. One must first understand the economic needs of the market. But there are other considerations. If the product is new and unique, do you price it high to maximize profits or low to gain market share and make potential competitors hesitant. Should adjustments be made due the change in seasonal demand? Should canoes be sold at a lower price in January then in May? Should pricing be adjusted based on transportation costs. Is pricing fixed regardless of the market segment being served? Knowledgeable pricing decisions make a great product or service into a profitable product or service.
The Marketing Strategy for Business Success
The marketing strategy is an expression of the company’s understanding of its market and the use of the marketing mix to satisfy its needs.
Wal-Mart’s strategy is “everyday low prices”. It focuses on the price element of the marketing mix, but as a result it does a remarkable job of the place or distribution element. Its distribution systems keep prices low and the shelves always full. One would not want to be a distribution manager at Wal-Mart with a major stock-out.
Starbucks has a strategy which is centered on the supply of high quality coffee, but it also provides a store environment which is friendly and welcoming. Part of its marketing strategy for business success is to, “gain employee loyalty by providing them dignity”. Their employees provide friendly service because of the environment provided by management.
These are two examples of the effective marketing strategies of large effective strategies, but remember that these strategies were one of the driving forces that allowed them to grow. Smaller firms can develop strategies which can impact their success. One local firm built a successful business on selling Italian ices on the beaches of North Carolina. They recognized that a large portion of their market were transplants from the northeast, who had grown up with Italian ice. They saw an initial demand and a product without competition in the local market. They provided a high quality product at a fair price and quickly saw their business grow from a push cart operation to a multi-store business.
The Marketing Plan for Business Success
It’s great to have a strategy, but making it a reality takes a great deal of effort. That effort is inthe development and implication of the marketing. It includes action items, responsibilities, and timing. Action items for business success might include:
- Determining a selling price
- Building a store
- Developing a distribution system
- Hiring sales people
- Training sales people
- and many more
Each item should be written out in chronicle order and crossed off as completed. Each item needs to be assigned to someone who takes responsibility. In a small company, many of those will be the responsibility of the owner, but people such as bankers, partners, real estate agents, to whom roles can be delegated, should be included for your business success. A targeted completion date for each item is very important. A good product launch or the institution of a new marketing strategy does not occur at the last moment. There are many steps which need to be completed either in series or parallel.
The development of a business success marketing plan is not a complex process. It is a systematic means of asking and answering the questions a business owner or manager should be continuously asking. It can help the business stay focused and eliminate many of the wasteful costly alternatives suggested by associates and those in the promotional field.