MGT403 Ent. Org Chapter 5 PDF

Fall Semester 2024 Chapter 05 2024-2025 Entrepreneurial Organization Dr. Rana M.Zaki  Chapter 5 2024-2025 The Marketing Plan  Complete This section prior...

Fall Semester 2024 Chapter 05 2024-2025 Entrepreneurial Organization Dr. Rana M.Zaki  Chapter 5 2024-2025 The Marketing Plan  Complete This section prior to preparing the marketing plan. Industry The primary focus is to provide knowledge of the Analysis environment that can affect marketing strategy decisions. The upside down pyramid approach or a SWOT analysis allows the entrepreneur to understand competitor’s strengths and weaknesses. 2024-2025 Competitor analysis begins with the current strategy of each competitor. Competitor Use search engines, library databases, and competitor’s social media. Once the strategy is summarized, identify the strengths and weaknesses Analysis of each competitor. All of this information can then be utilized to formulate the market positioning strategy of the new venture. https://www.strike.money/fundamental-analysis/industry-analysis https://penmypaper.com/blog/how-to-conduct-an-industry-analysis/ Industry Analysis 2024-2025 2024-2025 Marketing Research for the New Venture Marketing research gathers data to answer the following. Who will buy the product? What size is the potential market? 2024-2025 What price will be charged? What is the most appropriate distribution strategy? What is the most effective promotion strategy? The entrepreneur may conduct the research or hire someone The research begins by defining objectives or purpose— often the most difficult step. Marketing Research Step 1: Defining the Purpose or Objectives The most effective way to begin the marketing plan is to list the information needed to prepare the marketing plan. 2024-2025 Possible objectives include: Determine what people think of the product/service and if they would buy it. Determine how much customers would be willing to pay for the product/service. Determine where the customer would prefer to purchase the product or service. Determine where the customer would expect to hear about such a product or service.  Marketing Research Step 2: Gathering Data From Secondary Sources Secondary sources can provide information on the industry, market, and competitors. Go online to review competitors website and social media pages. 2024-2025 National and state websites provide free secondary information. Reviewing secondary sources is a good starting point in developing an effective marketing plan. It provides an early assessment of where the opportunities and threats might be. It also determines if more data are needed. If so, then primary data gathering must be planned. Marketing Research Step 3: Gathering Information From Primary Sources Gathering primary data involves a data collection procedure and a data collection instrument. Observation is the simplest approach. 2024-2025 Networking can be a valuable low-cost research method. Interviewing or surveying is the most common approach. The questionnaire used should include questions designed to fulfill one or more of the entrepreneur’s objectives. Focus groups discuss issues in an informal, open format. Marketing Research Step 4: Analyzing and Interpreting the Results The entrepreneur can enter the results on a computer or hand-tabulate the results. 2024-2025 Summarizing the answers to questions may give preliminary insights. Data can be cross-tabulated to provide focused results. Continuing to fine-tune the data provides insights, particularly regarding the segmentation of the market. Plan Differences Marketing Plan Business Plan Focuses on marketing A road map for the entire activities for one year or organization over time. more. Focuses on marketing but 2024-2025 Varies by industry, target also other facets. market, firm’s size, and Keep regularly updated to scope. help management stay Integral to the business focused. plan but also stands alone. Needs short-term management. Understanding the Marketing Plan The marketing plan establishes how the entrepreneur will compete and operate in the marketplace. After establishing the marketing strategies, assign costs to each. 2024-2025 The marketing plan should answer three basic The marketing plan questions. guides marketing decisions and Where have we been? should be prepared Where do we want to go (in the short-term)? annually. How do we get there? Outline for a Marketing Plan Situation analysis. Background of venture. Strengths and weaknesses of venture. 2024-2025 Market opportunities and threats. Competitor analysis. Marketing objectives and goals. Marketing strategy and action programs. Budgets. Controls. Characteristics of a Marketing Plan An effective marketing plan: The marketing system must first Provides a strategy to be understood. accomplish the mission. External and internal factors Is based on facts and valid affect marketing decisions. 2024-2025 assumptions. The marketing mix should Describes an organization to reflect the environment. implement the plan. The plan should provide Provides for continuity. feedback on the plan’s Is short, simple, and flexible. effectiveness. Specifies performance criteria to be monitored and controlled. The Marketing System 2024-2025 Source: R. Kerin, S. Hartley, and W. Rudelius, Marketing, 12th ed. (New York: McGraw Hill/Irwin, 2015), 40–47. Critical Decisions for Marketing Mix Marketing Mix Critical Decisions Variable Product Quality of components of materials, style, features, options, brand name, packaging, sizes, service availability, and warranties 2024-2025 Price Quality image, list price, quantity, discounts, allowances for quick payment, credit terms, and payment period Place- Channels Use of wholesalers and/or retailers, type of wholesalers or retailers, of distribution how many, length of channel, geographic coverage, inventory, transportation, and use of electronic channels Promotion Media alternatives, message, media budget, role of personal selling, sales promotion (displays, coupons, etc.), use of social networking, website design, and media interest in publicity Preparing the Marketing Plan Defining the business situation. Situation analysis reviews where the company has been and considers factors defined in the environmental and industrial analyses. Defining the target market: opportunities and threats. There should be a good idea of who the target market will be. 2024-2025 Market segmentation divides the market into homogeneous groups. To segment and target customers: Decide what general market or industry you wish to pursue. Divide market based on customer characteristics or buying situations. Select segment or segments to target. Develop a marketing plan integrating the parts of the marketing mix.  Considering Strengths and Weaknesses and Establishing Goals and Objectives The entrepreneur must consider strengths and weaknesses in the target market. Strengths and weaknesses will vary with an international market. 2024-2025 The entrepreneur must establish realistic and specific marketing goals and objectives. These answer the question “Where do we want to go?” Goals should specify such things as market share, profits, sales, and so on. Not all goals and objectives are quantifiable. Limit the number of goals to between six and eight. Defining Marketing Strategy and Action Plan Marketing strategy and action plan decisions answer “How do we get there?” and reflect variables in the marketing mix. Product or Service. Describes tangible and intangible characteristics. 2024-2025 Pricing. A combination of total cost and profit margins—considers three important elements: costs, markups, and competition. Distribution. Middlemen, manufacturer’s representatives, or brokers are options. Promotion. Informs customers about the product. Marketing Strategy: Business-to-Business Versus Consumer Markets Marketing strategy decisions for a consumer product vary from the decisions for a business-to-business product. 2024-2025 Consumer products involve sales to households for personal consumption. B2B marketing involves a more direct channel of distribution. The marketing mix for both markets is the same but the techniques and strategies vary significantly. Budgeting the Marketing Strategy Planning decisions must consider the costs involved in implementing those decisions. First, consider a reasonable budget as a percentage of forecasted sales—start-ups should budget between 12 2024-2025 percent and 20 percent. Next, provide a breakdown of marketing costs. Finally, review each cost for effectiveness and allocate portions of the marketing budget to each cost. This budgeting will be useful in preparing the financial plan. Implementing and Monitoring the Marketing Plan The plan is meant to be a commitment to a specific strategy. A commitment to make needed adjustments is also valuable. Someone should be assigned the responsibility of 2024-2025 coordinating and implementing the plan. Monitoring of the plan involves tracking specific results. What is monitored depends on specific goals and objectives. The entrepreneur must be prepared for contingencies. Appendix 8A: The Social Media Plan An effective social media marketing plan can build awareness, connect with new or existing customers, boost SEO, grow a mailing list, and drive revenue. 2024-2025 Step 1—set goals for the marketing effort. Step 2—select the right platform and approach. Step 3—identify influencers. Step 4—link all posts to the company’s website. Step 5—assess and analyze the plan’s effectiveness.  Appendix 8A: Pitfalls of Social Media Social media requires the cultivation of relationships, which takes time—be patient. It is important to have a strategy. 2024-2025 Avoid making all posts just on your brand. Do not avoid the tracking or the analytics on post effectiveness. The social media plan should be an integral part of any promotional efforts and tied to the company’s website.