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Marketing Strategy

Part 1 - Introduction

Firms that are successful in marketing invariably start with a marketing plan. Large companies have plans with hundreds of pages; small companies can get by with a half- dozen sheets. Put your marketing plan in a three-ring binder. Refer to it at least quarterly, but better yet monthly. Leave a tab for putting in monthly reports on sales/manufacturing; this will allow you to track performance as you follow the plan.

 

The plan should cover one year. For small companies, this is often the best way to think about marketing. Things change, people leave, markets evolve, and customers come and go. Later on we suggest creating a section of your plan that addresses the medium- term future—two to four years down the road. But the bulk of your plan should focus on the coming year.

 

You should allow yourself a couple of months to write the plan, even if it's only a few pages long. Developing the plan is the "heavy lifting" of marketing. While executing the plan has its challenges, deciding what to do and how to do it is marketing's greatest challenge. Most marketing plans kick off with the first of the year or with the opening of your fiscal year if it's different.

 

Who should see your plan? All the players in the company. Firms typically keep their marketing plans very, very private for one of two very different reasons: Either they're too skimpy and management would be embarrassed to have them see the light of day, or they're solid and packed with information . . . which would make them extremely valuable to the competition.

 

You can't do a marketing plan without getting many people involved. No matter what your size, get feedback from all parts of your company: finance, manufacturing, personnel, supply and so on—in addition to marketing itself. This is especially important because it will take all aspects of your company to make your marketing plan work. Your key people can provide realistic input on what’s achievable and how your goals can be reached, and they can share any insights they have on any potential, as-yet-unrealized marketing opportunities, adding another dimension to your plan. If you're essentially a one-person management operation, you'll have to wear all your hats at one time—but at least the meetings will be short!

 

What's the relationship between your marketing plan and your business plan or vision statement? Your business plan spells out what your business is about—what you do and don't do, and what your ultimate goals are. It encompasses more than marketing; it can include discussions of locations, staffing, financing, strategic alliances and so on. It includes "the vision thing," the resounding words that spell out the glorious purpose of your company in stirring language. Your business plan is the U.S. Constitution of your business: If you want to do something that's outside the business plan, you need to either change your mind or change the plan. Your company's business plan provides the environment in which your marketing plan must flourish. The two documents must be consistent.


Part 2 - Researching Your Market

The purpose of market research is to provide relevant data that will help solve marketing problems a business will encounter. This is absolutely necessary in the start-up phase. Conducting thorough market surveys is the foundation of any successful business. In fact, strategies such as market segmentation (identifying specific segments within a market) and product differentiation (creating an identity for your product or service that separates it from your competitors') would be impossible to develop without market research.

Whether you're conducting market research using the historical, experimental, observational or survey method, you'll be gathering two types of data. The first will be "primary" information that you will compile yourself or hire someone to gather. Most information, however, will be "secondary," or already compiled and organized for you. Reports and studies done by government agencies, trade associations, or other businesses within your industry are examples of the latter. Search for them, and take advantage of them.

Primary Research

When conducting primary research using your own resources, there are basically two types of information that can be gathered: exploratory and specific. Exploratory research is open-ended in nature; helps you define a specific problem; and usually involves detailed, unstructured interviews in which lengthy answers are solicited from a small group of respondents. Specific research is broader in scope and is used to solve a problem that exploratory research has identified. Interviews are structured and formal in approach. Of the two, specific research is more expensive.

When conducting primary research using your own resources, you must first decide how you will question your target group of individuals. There are basically three avenues you can take: direct mail, telemarketing or personal interviews.

Direct Mail

If you choose a direct-mail questionnaire, be sure to do the following in order to increase

your response rate:

  • Make sure your questions are short and to the point.
  • Make sure questionnaires are addressed to specific individuals and they're of interest to the respondent.
  • Limit the questionnaire's length to two pages.
  • Enclose a professionally prepared cover letter that adequately explains what you need.
  • Send a reminder about two weeks after the initial mailing. Include a postage-paid self-addressed envelope.

Unfortunately, even if you employ the above tactics, response to direct mail is always low, and is sometimes less than five percent.

Phone Surveys

Phone surveys are generally the most cost-effective, considering overall response rates; they cost about one-third as much as personal interviews, which have, on average, a response rate which is only 10 percent. Following are some phone survey guidelines:

 

  • At the beginning of the conversation, your interviewer should confirm the name of the respondent if calling a home, or give the appropriate name to the switchboard operator if calling a business.
  • Pauses should be avoided, as respondent interest can quickly drop.
  • Make sure that a follow-up call is possible if additional information is required.
  • Make sure that interviewers don't divulge details about the poll until the respondent is reached.

 

As mentioned phone interviews are cost-effective but speed is another big advantage. Some of the more experienced interviewers can get through up to 10 interviewers an hour (however, speed for speed's sake is not the goal of any of these surveys), but five to six per hour is more typical. Phone interviews also allow you to cover a wide geographical range relatively inexpensively. Phone costs can be reduced by taking advantage of cheaper rates during certain hours.

 

Personal Interviews

There are two main types of personal interviews:

 

  1. The group survey. Used mostly by big business, group interviews can be useful as brainstorming tools resulting in product modifications and new product ideas. They also give you insight into buying preferences and purchasing decisions among certain populations.
  2. The depth interview. One-on-one interviews where the interviewer is guided by a small checklist and basic common sense. Depth interviews are either focused or non-directive. Non-directive interviews encourage respondents to address certain topics with minimal questioning. The respondent, in essence, leads the interview. The focused interview, on the other hand, is based on a pre-set checklist. The choice and timing of questions, however, is left to the interviewer, depending on how the interview goes.

 

When considering which type of survey to use, keep the following cost factors in mind:

 

  • Mail. Most of the costs here concern the printing of questionnaires, envelopes, postage, the cover letter, time taken in the analysis and presentation, the cost of researcher time, and any incentives used.
  • Telephone. The main costs here are the interviewer's fee, phone charges, preparation of the questionnaire, cost of researcher time, and the analysis and presentation of the results of the questioning.
  • Personal interviews. Costs include the printing of questionnaires and prompt cards if needed, the incentives used, the interviewer's fee and expenses, cost of researcher time, and analysis and presentation.
  • Group discussions. Your main costs here are the interviewer's fees and expenses in recruiting and assembling the groups, renting the conference room or other facility, researcher time, any incentives used, analysis and presentation, and the cost of recording media such as tapes, if any are used.

 

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