Marketing Plan Development

Study Notes

Marketing Planning

Marketing plans are an essential function for marketers, focusing on a product or product lines, and improving coordination and performance.
A marketing plan can be divided into two parts: situation analysis and objective strategy programs.

Types of Marketing Plans

Retailing typically has short planning cycles due to seasonality and fashion trends.
Industrial firms and firms manufacturing consumer durable products often have annual marketing plans.
Automobiles have longer planning cycles due to longer product development lead times.

Hierarchy of Planning

Strategic planning occurs at the corporate, group, or strategic business unit levels and has a long-term nature (3-5 years or more).
Marketing planning takes place at the business center level and has specific objectives (e.g., market share) and strategies (e.g., pursuing small business segments).

Objectives of Planning

Define the current situation facing the product and how it was achieved.
Identify problems and opportunities facing the business.
Define strategies and programs necessary to achieve objectives.
Pinpoint responsibility for achieving product objectives.
Encourage careful and disciplined thinking.
Establish a customer-competitor orientation.

Frequent Mistakes in the Planning Process

Speed of the process: too slow or too fast.
Amount of data collected: insufficient or too much.
Who does the planning: delegated to professional planners or line managers.
Structure: too formal or too loose.
Length of the plan: too long or too short.
Frequency of planning: too frequent or too infrequent.
Number of courses of action considered: too few or too many.
Who sees the plan: limited to marketing department or shared with other departments.
Not using the plan as a sales document.

Situation Analysis

Presents relevant background data on sales, cost, market, competitors, and macro-environment.
Defines market size, growth rate, and relevant trends.
Conducts SWOT analysis to develop sound marketing strategies.

Marketing Objectives and Strategy

Statement of marketing objectives: defines where the product wants to go.
Marketing strategy: defines how to achieve objectives, including mission, marketing and financial objectives, and competitive positioning.

Supporting Marketing Programs

Decisions on pricing, channel of distribution, customer service programs, advertising, and other marketing programs.
Implements marketing strategies.

Financial Projections

Sales forecast: predicts sales volume by month and product category.
Expense forecast: predicts marketing expenses broken down into finer categories.
Break-even analysis: shows how many units must be sold to offset monthly fixed costs and average per-unit variable costs.

Implementation Controls

Outlines controls for monitoring and adjusting the implementation of the plan.
Spells out goals and budget for each month or quarter.

Financial Analysis

Product managers need to be knowledgeable about financial dimensions of their jobs.
Financial analysis is essential for understanding the financial implications of decisions.
Contribution-oriented system: focuses on the amount of money left over after accounting for variable costs that contribute to covering fixed costs.

Break-Even Analysis

Refers to the level of sales at which the company breaks even.
Managers often focus on the break-even level of sales to determine how far estimates could be before the company begins to lose money.

Description

Learn about the importance of marketing plans, which are typically annual and focus on a product or product lines, and how they improve coordination and performance. Discover the two general parts of a marketing plan: situation analysis and objective strategy programs.