Creating a Powerful Marketing Plan

Building a Guerrilla Marketing Plan Marketing

The process of creating and delivering desired goods and services to customers. Involves all of the activities associated with winning and retaining loyal customers.

Guerrilla marketing strategies

original, low-cost creative marketing techniques that allow a small company to wring more bang from its marketing bucks.

A Guerrilla Marketing Plan

1. Pinpoints the specific target markets the company will serve. 2. Determines customer needs and wants through market research. 3. Analyzes a firm's competitive advantages and builds a marketing strategy around them. 4. Creates a marketing mix that meets customer needs and wants.

Pinpointing the Target Market First step in building a guerrilla marketing plan is to pinpoint the company's target market
The specific group of customers at whom the company aims its products or services.
The more a business learns about its local markets, its customers and their buyers habit and preferences, the more it can focus its marketing effort.

Without a clear image of its target market, a small company tries to reach almost everyone and ends up appealing to almost no one!
Learn how to reach the target market and offer goods and services designed specifically for them

Determines Customer Needs And Wants Through Market Research

Market research is the vehicle for gathering the information that serves as the foundation for the marketing plan.
It involves systematically collecting, analyzing and interpreting data about companys market, customers and competitors. The objective of marketing research is to learn how to improve the level of satisfaction for existing customers and to find ways to attract new customers.

Market research does not have to be time consuming, complex, or expensive to be useful.

Determines Customer Needs And Wants Through Market Research

How to Conduct Market Research: Define the problem.
List all possible factor that could have caused it.

Collect the data.

Individualized (one-to-one) marketing
A system based on gathering data on individual customers and developing a marketing program designed to appeal specifically to their needs tastes and performance
Customer survey Focus group Daily transaction Other idea (suggestion system)

Data mining
A process in which computer software that uses statistical analysis, database technology and artificial intelligence finds hidden patterns, trends and connections in data so that business owners can make better marketing decisions and prediction about customers behavior.

Analyze the data and interpret the results. Draw conclusions and act.

Plotting a Guerrilla Marketing Strategy: Relationship Marketing Customer Relationship Management

Involves developing and maintaining long-term relationships with customers so that they will keep coming back to make repeat purchases. Small companies have an advantage over their larger rivals at relationship marketing. Requires a company to make customer service an inclusive part of its culture.

Steps in CRM
Collect meaningful information on existing customers and compile it in a database. Mine the database to identify the companys best and most profitable customers and their buying habits. Use the information to establish lasting relationships with these customers. Attract more customers who fit the profile of the companys best customers.

Guerrilla Marketing Strategies

Find a niche and fill it.
Niche strategy allows a small company to maximize the advantage of its size

Dont just sell; entertain.

Entertailling- a marketing concept designed to draw customers into a store by creating a kaleidoscope of sights, sounds, smells and activities, all designed to entertain and of course sell.

Strive to be unique.
To create an image of uniqueness.

Create an identity for your business.

Can use vision to market their companies and their product and services

Connect with customers on an emotional level.

Customer receives an emotional boost every time they buy the product.

Guerrilla Marketing Strategies

Focus on the customer.
Develop a customer focus and inspire a customer satisfaction attitude throughout the company.

Devotion to quality.
World-class companies treat quality as a strategic objective, an integral part of the company culture. This is the philosophy of Total Quality Management (TQM).
Quality in the product or service itself. Quality in every aspect of the business and its relationship with the customer. Continuous improvement in quality

Attention to convenience.
Customers increasingly are looking for convenience
Location, timing, service, extra offer, well trained employees, efficiency

Guerrilla Marketing Strategies

Concentration on innovation.
Entrepreneurs often create new products and services by focusing their efforts on one area and by using their size and flexibility to their advantage.

Dedication to service and customer satisfaction.

Listen to customers. Define superior service. Set standards and measure performance. Examine your companys service cycle. Hire the right employees. Train employees to deliver superior service. Empower employees to offer superior service. Use technology to provide improved service. Reward superior service. Get top managers support. View customer service as an investment, not an expense

Guerrilla Marketing Strategies Emphasis on speed.

Use principles of time compression management (TCM):
Speed new products to market. Shorten customer response time in manufacturing and delivery. Reduce the administrative time required to fill an order.

Benefits of Marketing on the World Wide Web

Even the smallest companies can market their products and services around the globe. 67% of small businesses that established Web sites said their sites brought in new customers. The Web can be the Great Equalizer in a small companys marketing program.

The Marketing Mix

Product Place Price Promotion

Stages in the Product Life Cycle

Introductory stage
Slow sales growth, highest promotional expense, highest product prices and negligible profit. Strategy
Rapid Skimming Strategy- high price, high promotional expense Slow Skimming Strategy- high price, low promotional expense Rapid Penetration Strategy low price, high promotional strategy Slow Penetration Strategy- low price, low promotional strategy

Growth and acceptance stage

Strategy
Improve product quality and add new product features and improved styling Add new models Enters new market segment Increase distribution coverage and enters new distribution channel Shift to product conviction promotion Lower price to attract new price sensitive buyers

Stages in the Product Life Cycle

Maturity and competition stage
Increase in sales at decreasing rate Strategy
Market modification Sales can be increased by increasing the brand users or by increasing the usage rate per user or both Product modification quality improvement, feature improvement, style improvement Market mix modification change any component of marketing mix

Product decline stage

Lower sales due to availability of new substitutes and changes in the consumer tastes and preferences. Strategy
Reducing the number of items produced and promotional expense. Discarding the product Repositioning the product

Stages in the Product Life Cycle

Introduction Growth Maturity Decline

Total market sales

Total market profit

Lunching of the product

Rapid Increase in Sales and Maximum Profitability

Increase sales at decreasing rate

Sales & Profits Fall

Channels of Distribution Consumer Goods

Manufacturer Consumer

Manufacturer

Retailer

Consumer

Manufacturer

Wholesaler

Retailer

Consumer

Manufacturer Wholesaler Wholesaler

Retailer

Consumer

Channels of Distribution Industrial Goods

Manufacturer

Industrial User

Manufacturer

Wholesaler

Industrial User

Developing a Marketing Communications Plan

Step 1: Create specific, measurable objectives. Step 2: Identify and analyze the target audience. Step 3: Design an advertising message and choose the media for transmitting it.

Promotion Includes Publicity

any commercial news covered by the media that boosts sales but for which the small business does not pay.

Personal selling
the personal contact between sales personnel and potential customers resulting from sales efforts.

Advertising
any sales presentation that is non-personal in nature and is paid for by an identified sponsor.

Build Ads Around a Unique Selling Proposition (USP)

USP - A key customer benefit of a product or service that answers the critical question that every customer asks: What's in it for me?
Identify your product or service's USP by describing the primary benefit it offers customers and then list other secondary benefits it provides. Dont overlook the intangible or psychological benefits your product or service offers. Briefly list a few facts that support this USP. Then, focus your ads to stress these top benefits and the facts supporting them!

Five Fundamentals of a Successful Advertisement.

It should attract attention. It should emphasize a key benefit of the product or service to the customer.

It should communicate the companys Unique Selling Proposition (USP).

It should prove the USP and benefits to the customer with facts, statistics, or testimonials.
Source: Adapted from Jerry Fisher, Fine Print, Entrepreneur, November 1994, pp. 145-

It should motivate customers to take action immediately.

Successful Personal Selling Requires a Selling System

Create trust and respect - Establish rapport with prospect. Interview the prospect - Let the prospect talk to determine the key criteria that influence the buying decision. Demonstrate, explain, and show Make clear the benefits of your product or service. Validate - Prove the claims about your product or service. Overcome objections- Listen for objections and try to overcome them. Close - Stop talking and ask for the order.

Advertising Media Options

Word-of-Mouth Newspapers Radio Television Magazines Direct mail World Wide Web

Outdoor ads Transit advertising Directories Trade shows Specialty advertising Point-of-purchase ads

Newspapers
Disadvantages Advantages Wasted readership Selected geographic coverage Reproduction limitations Flexibility Lack of prominence Timeliness Declining readership Communication potential Short ad life Low cost Prompt responses

Radio
Advantages
Universal infiltration Market segmentation Flexibility and timeliness Friendliness

Disadvantages
Poor listening Need for repetition Limited message

Television
Disadvantages Advantages Brief exposure Broad coverage Clutter Visual advantage Zapping Flexibility Fragmented audience Design and production assistance Costs

Magazines
Advantages
Long life spans Multiple readership Target marketing Ad quality

Disadvantages
Cost Long closing times Lack of prominence

Direct Mail
Advantages Selectivity Flexibility Reader attention Rapid feedback Measurable results and testable strategies Effectiveness

Disadvantages Inaccurate mailing lists Clutter High relative costs High throwaway rate

Advertising on the Web

Banner ads Pop-up ads Cookies Full-page ads Push technology ads E-mail ads
Permission e-mail Spam

Outdoor Advertising
Advantages

High exposure Broad reach Flexibility Cost efficiency

Brief exposure Limited ad recall Legal restrictions Lack of prominence

Disadvantages

Transit Advertising
Advantages
Wide coverage Repeat exposure Low cost Flexibility

Disadvantages
Generality Limited appeal Brief message

Directories
Advantages
Prime prospects Long life

Disadvantages
Lack of flexibility Ad clutter Obsolescence

Trade Shows
Advantages
Natural market Pre-selected audience New customer market Cost advantage

Disadvantages
Increasing costs Wasted effort

Specialty Advertising
Advantages
Reaching selected audiences Personalized nature Versatility

Disadvantages
Potential for waste Costs

Preparing An Advertising Budget

What is affordable Matching competitor's advertising expenditures Percentage of Sales Past Sales Forecasted Sales Objective-and-Task

25% Advertising Expenditures by Medium 23.5% 20% 15%

13 . 0 % 19 . 3 % 19 . 1%

Percent

10%
7.7% 5.9%

5% 0%

4.8% 1. 9 % 2.2% 2.5%

Te le vi si D ire on ct N M ew sp a il ap er s R ad D ire io ct or i M ag es az in es Pa pe rs O ut do In or te rn et O th er
Medium

How To Advertise Big On A Small Budget Take advantage of cooperative advertising. Consider shared advertising. Repeat ads that have been successful. Use identical ads in different media. Hire independent copywriters and artists. Concentrate advertising when customers are most likely to buy. Maximize publicity with techniques such as cause marketing.

The Factors That Must Be Considered When Determining Price

The factors that small business owners must consider when determining price for goods and services includes:
Product/service costs Market factors - supply and demand Sales volume Competitors' prices The company's competitive advantage Economic conditions Business location Seasonal fluctuations Psychological factors Credit terms and purchase discounts Customers' price sensitivity Desired image

What determines price?

Price Ceiling ("What will the market bear?")

?
Acceptable Price Range

? ?

Final Price (What is the company's desired "image?")

? ? ? ?

? ?

Price Floor ("What are the company's costs?")

Pricing Strategy
Introducing new product Goals:
Getting the product accepted Maintaining market share as competition grows Earning a profit

Strategy
Penetration set prices below competitors to gain market entry Skimming set higher prices for new products and for markets with little or no competition. Sliding-down-the-demand-curve set higher prices initially and slide down as technology improves and/or one step ahead of competitors

Pricing Techniques
Odd pricing
12.95 appears to be cheaper than 13.00

Price lining
Several different price range. Ex- DVD price

Leader pricing
Marks down the customary price

Geographical pricing
Zone Pricing - Different price for customers located in different territories because of different transportation cost. Delivered Pricing same price regardless of location FOB pricing sells on the condition that customers will pay all the shipping cost

Opportunistic pricing
Charging high when goods and services are short in supply

Discounts
Multiple unit pricing discounts if purchased in quantity.

Suggested retail prices

Pricing for Retailers: Markup

Dollar Markup = Retail Price - Cost of Merchandise Percentage (of Retail Price) Markup = Percentage (of Cost) Markup = Example: Dollar Markup = $25 - $15 = $10 Percentage (of Retail Price) Markup = Dollar Markup Retail Price

Dollar Markup Cost of Unit

Percentage (of Cost) Markup =

$10 $25 $10 $15

= 40% = 67%

Pricing for Manufacturers: Breakeven Selling Price

Total Variable cost Quantity } Breakeven { fixed { per unit x produced }+ costs Profit X Selling = Quantity produced Price Example: Breakeven $0 X { 6.98/unit x 50,000 /unit } + $110,000 = Selling 50,000 units Price = $9.18 per unit

Pricing for Service Firms: Price per hour

Price per Hour = Total cost per x productive hour Example: Neds TV Repair Shop
Price per Hour = $13.44 per x hour

1.00 (1 - net profit target as % of sales)

1 (1 -.18)

= $16.38 per hour