This book will be laid out in sections. We’ll give you the template first with details and explanation following. If you understand the template, you can wiz right through the process. If there’s something you need a little help with, read the details.
The Marketing Plan Template is comprised of three main steps: research, strategy and tactics. All good marketing plans begin with research. The second step is developing a strategy followed by tactics or action plan. Finally, while not a regular step in developing the process, you need to monitor the results from your marketing plan to insure that you get the exposure, sales, or other benefits you planned for in your strategy.
The first part of your plan, as we’ve said before is the research portion. You’ll want to break down your research into four categories, 1) Industry & Markets, 2) Competition, 3) Customers and, 4) Company. The market analysis template is as follows.
- Description of Industry
- Industry Trends
- Market Segment(s)
- Distribution Channels
- Direct & Indirect Competition
- Strengths & Weaknesses
- Company Profile
- SWOT Analysis
Understanding your market is one of the important first steps in preparing to develop a marketing plan. Understanding how your market works, the size and potential for either a new company or an expanded role for an existing company in the market structure are key components. Who are your competitors and why would a potential customer buy from you? Understanding the market is the most important part of the marketing process.
While this part seems to be simple and is often overlooked or skipped, it requires a serious analysis of each component. Brainstorm and research each market segment in which you will compete, and then boil down the results into a form to help you ‘see’ the market at a glance. Once you’ve assembled all the information, list it in a matrix format to get an ‘at a glance’ view of your market. You may also use the Market Matrix Worksheet that is available for download at www.BusinessStart-up101.com.
Some of the critical questions you need to answer are:
How big is the market?
In actual dollar sales, how much combined do all the participants in the market sell? Can the market support another competitor? Knowing how big the market is and who has the major share will help you determine your strategy.
What % of the market share do I want or need?
Based on your own financial projections, what percentage share of the market do your sales represent? Is that a reasonable percentage? If your financial projections show your company with a large percentage of the market share, do a reality check with your advisors or mentors to confirm your projections and assumptions.
If you are hoping to be a national market player, how will the large competitors in the market react to your entry into the market and subsequent rise from a small company that they can ignore, to a real competitor?
What are the different market segments?
Most industries have many different segments that make up a market. For example, in the hand tools market, there are segments for woodworking, vehicle repair, machinery repair and many specialty segments. Within each segment there are sub-segments. For example, within the woodworking segment, there are sub-segments for the casual home repair novice or apartment dweller, the weekend handyman doing major home repairs and remodeling, and the professional tradesmen. Almost all industries have several to dozens of market segments and hundreds of sub and sub-sub segments.
In what market segment will my company compete?
Known as your target market, this is the primary market segment in which you will compete. If you manufacture specialty hand tools for professional commercial HVAC installation and repair, you will not be concerned about the casual home repair novice or apartment dweller market. It is important to identify in which specific market segment or segments you will compete and learn as much about how those segments work as possible.
Many markets likely already have a dominant player who serves a broad section of the market, perhaps operating across many different segments. How will you compete with this dominant player? Perhaps you can find a niche segment or sub-segment in which to operate. If you’re not looking to awaken the sleeping giant, the major player in the market, perhaps your best bet is to think small. By that, I mean to operate within a small niche at first to prove your model and fine tune your business skills. After you have smoothed out the rough spots in your operating model, only then might you want to expand your business to serve a larger segment.
Distribution channels are the way in which you’ll get your products or services to your customers. How you go to market can be largely defined by your individual market. If everyone in the market uses the same distribution method, and your target customer prefers that method, then you’re probably limited to operating largely with that distribution method. That’s not to say you can’t offer your products or services through other channels, but be prepared to be underwhelmed by the response from your customers. However, business is an ever changing dynamic, and new models are designed and tested every day. Who’s to say your new distribution channel isn’t the next best method? Do your research, know your customer preferences and test your methods before investing lots of money in an untested method. Who would have guessed in 1990 that movies would be rented by downloading them directly from your TV and not by driving to a retail store where you would browse the shelves in search of your favorite film in VHS format?
What is your distribution strategy? What channels will you use? How do the standard distribution channels affect the way you plan to do business? Do you need partnerships with distributors, sales reps, manufacturer’s reps or other resellers? Understand the standard channels in your market, how you’ll do business the same or differently and what you can do to differentiate yourself from the competition. How can you improve the standard channels models to make it easier for your customers to do business with you versus your competition?
Stay connected with us on social media and our blog. Next week we will look at analyzing competition.