A lot of entrepreneurs have no idea how to create an effective marketing plan or even how vital having one in the first place will be to the success of their venture. Bottomline, from day one you need to be thinking about how you will effectively capture your target market.
Your ultimate goal for a marketing plan is to grow your business by:
- Creating Awareness
- Driving Qualified Prospects
- Generating Sustainable Revenue
- Building Trust with Customers
So remember your marketing plan is your plan of attack for your business. It needs to be a thoughtful, realistic and, most importantly, an executable road map (using the resources you have on hand) for acquiring customers and keeping them (and getting them to LOVE your products and services). To that end, here’s an overview of what it should look like and things you have to take into account.
First off, what is a marketing plan?
A marketing plan is a written document that defines your marketing objectives over a period (should be a year or more), details the strategy behind these objectives, and the tactics you will use to achieve them. In order for your marketing strategy to work, it’s has to be multi-faceted, realistic and implemented consistently. The marketing plan for your venture will provide a blueprint and will be part of your pitch when you’re looking to raise money.
So assuming you have already defined your product, brand and pricing (if not, check out our other posts covering each of those topics discretely), here are the six steps to developing your marketing plan:
Step 1: Understand Your Situation
The first step in your developing your marketing plan is to define your current situation which means getting to know your company and the market it seeks to operate in. Your business has an identity defined by its strengths, weaknesses and goals, as well as your target market, competition, location and so on. Your situational overview should cover the external and internal strengths, weaknesses, opportunities and threats (aka SWOT analysis), critical success factors in the industry (e.g. regulations) and how you plan to build a sustainable competitive advantage.
This will require market research to confirm and fortify the information your will use as the basis of your marketing plan. Then after you’ve gathered all the needed information, you’ll develop your marketing strategy.
To get started with the situational overview, here are some areas to touch on:
- Your macro-environment
Answering the questions:- What effects will the economy, government regulations, state of existing and emerging technology, cultural trends have on your business?
- Your market
Answering the questions:- What is the size of the market?
- How should you segment the market?
- Who is your competition, what market share do they have and what are each of their strengths and weaknesses?
- What relevant market trends are you seeing?
- Your target customer
Answering the questions:- What is their profile?
- What are their demographics?
- What are their psychographics?
- What motivates them?
- What dictates their buying decision?
- Your internal vision, assets and weaknesses
Answering the questions:- What are your objectives? …financial, marketing, cultural—a description of the basic business philosophy and corporate culture you are building can go here too.
- What are marketing goals? …develop a short list of marketing goals that are measurable, make sure they’re specific and ambitious while realistic.
- What resources you have and/or will need to achieve your goals? …financial, human, etc.
- What capabilities you have and/or will need to achieve your goals?…skills, technologies, etc.
Step 2: Develop a USP for Your Business
To do that, start by thinking about who you want to be as a company, your personality, what’ll make you great, the lens through which you’ll make decisions, your organizing principle and mission, and how you want all that conveyed to the outside world. Ask yourself: what perception do I want the market to have of us? How will I get the market to even care? Then articulate it in your USP.
Specifically, your Unique Selling Proposition (USP) should:
- Tell the market why they should care
A good USP is written in a language that’s meaningful to the target market. It should explain what’s in it for them. Your USP needs to reflect a deep understanding of the customer, should serve to generate demand in them for your product and clearly set you apart from your competition. And keep in mind, your competition might not just be other products, it might also be other ways your customers are solving the problem today and/or a lack of understanding by your target customer as to why your solution is even relevant to them (in other words, you are competing with their lack understanding and apathy). - Create tilt
The USP you are developing needs to be designed to tilt the cost-benefit calculus, in the minds of your customers, in your favor. That is, when they hear your USP, they immediately understand the benefits they will receive by purchasing and consuming your product. And those benefits need to outweigh the price you are asking. Creating tilt comes from a host of things—price, features and your sales pitch (i.e. how you explain, and make relevant, the benefit promises carried in your marketing).
Step 3: Develop Your Tactical Plan
Now you will set your sights on defining a tactical plan. Your tactical plan will cover the channels and creatives that will carry your message. To do that you will:
- Define your promotional mix
Your promotional mix covers tactics like digital advertising, content marketing, social media (paid, organic), email marketing, direct sales, sales promotion, publicity and PR, etc. - Define how to target all stages of the sales cycle
The right marketing program for your startup will target prospects at all stages of the sales cycle. To do that, you’ll align your goals for each stage of the marketing funnel with each of your proposed tactics.
For instance:- Upper Funnel:
- Advertising and PR are generally upper funnel, awareness driving tactics.
- Content marketing can be used to drive brand awareness.
- Mid/Lower Funnel:
- Direct marketing, like email or paid search, are generally mid and lower funnel tactics. They are also often used for driving consideration and conversion.
Step 4: Develop Your Media Plan
At this point, you will consider your customers’ media habits and refine your tactical plan from that perspective. Start by thinking about your target customer:
- The prevailing media channels they use.
- Their geo-locations.
- The potential cost associated with reaching and acquiring them.
- When they will/will not might be in a receptive frame of mind (receptive to your marketing message).
Ultimately, you’ll test each channel and methodically narrow it down to ones that are most effective (for more on that, check out the Bullseye Framework)
Step 5: Define Your Promotional Budget
As you outline a promotional plan for your venture, you need to consider a realistic budget based on your goals, ROI etc. To know what you should be spending on marketing, you need to take into account (among other things):
- The average cost of acquisition in the industry
- The ROI you need to be targeting to make your business model work
- The LTV you might expect from a new customer
But keep in mind, your answer is going to be unique to your business. Budget is a fundamental variable that differs from one business to another.
Step 6: Define Your Metrics
Now on an ongoing basis, you will track and measure your marketing efforts to optimize for ROI. To that end, the first step will be to define your metrics and KPIs. It goes without saying that you must track and measure the results of your marketing tactics (otherwise, how are you able to know which ones are most effective, per #4 in this list?) and optimize your program accordingly. To that end, it’s critical you define upfront which metrics will be most meaningful in assessing your tactics—which are working, which are wasteful.
- Upper Funnel:
