Marketing Planning

What is Marketing Plan?

A marketing plan is a written document containing the guidelines for the business centers marketing programs and allocations over the planning period. The objectives of a marketing plan can be stated as follows: 1. To define the current situation facing the product 2. To define problems and opportunities facing the business 3. To establish objectives 4. To define the strategies and programs necessary to achieve the objectives 5. To pinpoint responsibility for achieving product objectives 6. To encourage careful and disciplined thinking 7. To establish a customer-competitor orientation.

Some Frequent mistakes in the Planning Process:

The speed of the Process The amount of data collected Who does the planning? The structure Length of the Plan Frequency of Planning Number of Courses of action Considered Who sees the Plan Not using the Plan as a Sales Document Insufficient Senior Management Leadership

The Planning Process:

Planning Analysis Objectives Strategies

Evaluating

Implementing

Steps in the Planning Process:

Step 1: Update the historical data Step 2: Collect background data Data collection focuses on information available about current situation, which forms the situation analysis part of the plan. Step 3: Analyze historical and background data Analyze the existing data to forecast competitors actions, the behavior of customers, economic conditions, etc. Such analysis leads to delineating key opportunities and threats to the business.

 Step 4: Develop objectives, strategies, and action programs The implications drawn from the background data are used to formulate objectives, strategies, and marketing mix decisions. This part of the process generally involves (1) setting product objectives, (2) developing strategies and programs to achieve the objectives, (3) comparing programs in terms of their abilities to achieve objectives within the terms of company policies and legal constraints, and (4) selecting a basic objective, strategy, and program combination. Step 5: Develop pro forma financial statements Such statements typically include budgets and profit-and-loss figures.

 Step 6: Negotiate The marketing plan generated from steps 1 to 5 are implemented only after several rounds of negotiations with senior management. The plans are themselves marketed both inside and outside marketing as managers compete for their desired portions of corporate or divisional resources. Step 7: Measure progress To correct the plan for any environmental changes, progress towards the stated objectives must be monitored. Therefore, marketing research and other information relevant to measuring the quantities stated as objectives must continue to be collected.

 Step 8: Audit After a planning period, it is customary to determine variances of planned versus actual results and sources of variances. This audit provides important diagnostic information for both current and future planning efforts and thus acts as a source of feedback on the planning effort.

Components of the Marketing Plan:

I. Executive Summary II. Situation Analysis
A. B. C. D. E. Category/competitor definition Category analysis Company and competitor analysis Customer analysis Planning assumptions

III. Objectives IV. Product/Brand Strategy V. Supporting Marketing Programs VI. Financial Documents VII. Monitors and Controls VIII. Contingency Plans

The Executive Summary

It is a brief summary of the marketing plan focusing on the objectives, strategies, and expected financial performance. This brief overview is useful for quickly reviewing the major elements of the plan and easily comparing product plans.

Situation Analysis
No strategy should be developed without first analyzing the product category in which the product competes. It is composed of six major parts. The first major section is the definition of the competitor set or category definition. In this part, the product manager considers both close and distant competitors and prioritizes them. The category analysis identifies factors that can be used to assess the attractiveness of a product category in which the product competes at a given point of time. Since all markets are dynamic as far as the competitors, customers, technology, and sales growth rates are concerned, the underlying attractiveness of a product category as a target for investment can also change.

Competitor analysis asks who the key competitors are in the market and what their likely future strategies are. A critical section of the competitor analysis component is what is often termed as resource analysis or self-assessment. The aim of the customer analysis is to guarantee that the product manager retains a customer focus at all times. It is vital to understand not only who the customers are but also how and why they behave the way they do. The fifth part of the background assessment deals with a wide variety of planning assumptions. The products market potential is a key number in making decisions about expected future category growth, resource allocation, and many other areas. Market and product forecasts & assumptions about uncontrollable factors, such as raw materials or labor supply.

Marketing Objectives/Strategy
It is logical to follow the background assessment by the strategy portion of the plan, which includes two sections: a statement of marketing objectives and the marketing strategy itself.

Supporting Marketing Programs

Decisions about pricing, channels of distribution, customer service programs, advertising, and other relevant marketing programs are described in this section.

Rest of the Plan

The financial documents report the budgets and pro forma profitand-loss or income statements. The monitors and controls section specifies the type of marketing research and other information necessary to measure progress toward achieving the stated objectives. The kind of information collected depends on the objectives; for e.g. if a market share increase is the objective, information must be collected in time to check for possible shortfalls. The contingency plans are helpful in dynamic markets where either new products or new competitors create the need for changes in strategy before the end of the plans horizon.