Ontario Ministry of Agriculture, Food and Rural Affairs i

Developing a Marketing Plan

INTRODUCTION

In today's consumer based marketplace, developing an effective marketing plan for your business
involves understanding what the marketplace wants. It's not a question of what should I grow or
produce to make money, it's what is the marketplace looking for that will result in profit for my
business.

The psychology behind marketing is that human beings acquire and consume products and
services. Therefore, marketing is about persuading minds as to what products and services to
acquire and consume. Consumers have become cautious in their purchasing practices and try to
avoid the following risks: monetary, financial, social and psychological. Thus the marketplace is
no longer about products and services but about the customer.

A marketing plan is a vital component of your overall business plan and is often considered the
most crucial, but often the most difficult to develop. A comprehensive marketing plan examines
global and consumer trends; reviews the marketing mix of product, price, place and promotion;
and provides details of how you will market your product or service over a certain period of
time.

For those new to marketing, it is often described in terms of the 4P's. The 4P's affect every
marketing decision you make from production to the end user and include:

Product: What is your product or service?

Price: What you will charge for it?

Place: Where will your product or service be offered in the marketplace?

Promotion: How will you let people know about your product or service?

Steps to a Successful Marketing Plan

1. Know Yourself, Your Customer, and the Marketplace

Unless you are a large corporation who can afford to market to the masses, it is best to focus on a
specific segment or niche market. How do you find your niche market? This is achieved by
conducting market research which gives you knowledge to help leverage sales. Market research
involves seeking out information and asking the following questions:

 Who will buy, or is buying and using my products or services?

  Who are my competitors and what products are competing with mine? (Referred to as
competitive intelligence).
 What benefits am I selling to the customer?
 What is the customer prepared to pay?
 What does the customer like?
 Where does the customer come from?
 How much does the customer need and how can I build market share?

Market research does not have to involve hiring a research firm as helpful information is often at
your fingertips. You need to examine what information has already been collected also referred
to as secondary research data. Internally, the business owner can review sales reports and
invoices, cash register receipts and other internal records in order to observe sales patterns,
inventory flow, and customer traffic to gain an understanding of what is selling, when it is selling
and to whom.

External sources of secondary research may include government publications, statistical census
reports and countless books and articles on demographic and market trends. Business service
agencies such as your local Chamber of Commerce, Business Enterprise Centre or Small
Business Self Help Office also offer helpful information at the local level. This may include
information on local household income, demographics, travel patterns and more. The Internet
may also provide a huge inventory of information relating to your specific market segment or
product. Secondary research is often the easiest and least expensive way to obtain market
information.

A more detailed approach to market research involves primary research methods.

Primary marketing research is important when considering an innovative enterprise, or a new

and/or local market for which little published data exists. You may want to approach a local
college or business school and present the information gathering as a golden learning
opportunity. Primary research may include test marketing, surveys and observation.

2. The Marketing Strategy

Once you feel comfortable with the research results you have gathered, and have identified your
target market, you need to develop your marketing strategy or strategies.

A strategy captures where your business is headed in a statement that will help guide you on
your way. Example: A marketing strategy may include the following statement: Grow sales of
my XYZ product to young families living in the city of XYZ and surrounding area.

Objectives to meet this strategic statement may include: Provide a quality product for young
families and increase sales by 10 per cent per year over the next five years to reach $250,000 in
gross profit by 2015.
3. Implementation Strategy

Your implementation strategy will be the most detailed and perhaps the most important part of
your marketing plan. This is where you set out, step by step exactly what you will do to meet the
needs of your target customers, and attract them to your product.

How am I going to market and promote my product?

As stated earlier, the amount of time and money you dedicate to marketing will include
advertising and promotional costs. Advertising is expensive; however, the avenue you choose to
get your message out is critical to success.

Advertising Methods to Consider

Website
In today's "connected” world having a website for your business is critical! Make sure that it is
kept up-to-date and has the capability for customers to converse with you through emails or other
methods of social media such as blogs, Facebook, and Twitter.

Print
May include brochures, business cards, newspaper, magazines, trade magazines, local tourism
guides, etc. There are many opportunities for print advertising and if you are a new business; test
a few out, and be sure to include a 'call to action' which may include a coupon to see if the
advertising is working.

Electronic
Is often more expensive but reaches a broader audience and includes television and radio.

Signage
If you place road signs be sure to check with the local municipality/township and/or Ministry of
Transportation regarding regulations. Consider your vehicles as mobile signs promoting your
business name and key contact information such as telephone number and website.

Direct Marketing
If you are able to collect email, phone numbers, regular mail and other contact information from
customers (with their permission of course), you can reach them through direct marketing to tell
them about upcoming events, specials, etc. Direct marketing is a form of relationship marketing
as you are focusing the message on known customers, not the broader public. Direct marketing
activities should have a call to action to know if your customers are looking at your materials.
Example: If you email customers regarding a special event include a coupon so if they
participate you know they have read the material.

i
Collins, D. (2010) Developing a Marketing Plan. Ontario Ministry of Agriculture, Food, and Rural Affairs (OMAFRA)
FactSheet. Retrived 5 May 2011, from http://www.omafra.gov.on.ca/english/busdev/facts/10-029.htm
Special Events
Coordinating and promoting a special event for your business allows you to target your
advertising dollars even more. Becoming involved in a community event spreads the expenses
and awareness even more. Examples: Farm tours, fall fairs, community BBQ's, fund raiser for a
local charity.

Public Relations
Public relations is how you can reach customers and the media through a number of activities
that require little or no direct spending on advertising. A public relations plan for your business
may include activities such as: speaking engagements at service clubs/schools/community events
to share your expertise and at the same time promote your business. Example: The majority of
the population is not familiar with farming or food production, having the opportunity to 'share
your story' can prove to be beneficial for your business.

Another popular public relations activity is working with the media who are looking for unique
story ideas and news tips. Example: Developing a press release or story about your farm and
sending it to targeted media in your area may not be that effective, however if you accompany
your press release with a sample of your product (e.g. a pint of strawberries, a picture and a
recipe to promote that pick-your-own strawberries are ready at your farm) the odds of a
newspaper story may be improved.

Customer Loyalty
This is the most important marketing tool. Loyal customers or repeat customers represent eighty
percent of your business. Loyalty equals growth and profitability. Complaints from loyal
customers are your golden nuggets as gives opportunity for improvement. Loyal customers help
build your business and spend more money over time. A loyal relationship is built on knowing
your customer. Never make assumptions regarding need and expectations. Therefore, building
customer loyalty is a journey that involves re-inventing and or improving your product or service
on a continual basis.

Word of Mouth
Once you have implemented your marketing strategy and you are experiencing a return on
investment from your advertising efforts - happy customers will tell others about your product
and service. Word of Mouth remains the most popular form of advertising but it takes time to
establish. Ensure exceptional customer service so the word being spread is positive and captures
new customers.

4. Establishing Price

Of the 4P's of marketing, establishing a price for your product or service is important to ensure
you are making a profit. Step one is to understand the costs involved in developing your product.
This includes supplies, equipments, labour, packaging, shipping etc. Then you have to decide
what price you need to charge to cover your costs and make a profit. This is known as your profit
margin. Depending on the attributes of your product or service, you can sell at a premium and
demand a higher profit margin. As a new business owner be sure not to under price your product
or service as it will prove difficult to demand a higher price going forward.
5. Evaluate; Evaluate, Evaluate

Once you have put your marketing strategies in place you will be able to see if sales targets are
meeting or exceeding your expectations. Experience will also tell you what advertising and
public relations activities are not working and should not be pursued in the future. Examples of
simple ways to evaluate your marketing plan: Look at sales records, customer surveys,
redemption of coupons and other special promotions to determine what is working and not
working and continually make improvements.

Your competition, customer and marketplace will continually evolve and if you can keep on top
of such changes, you will be able to adjust your marketing plan to keep your business thriving.