CHAPTER 8:

THE MARKETING PLAN

INDUSTRY ANALYSIS
• To provide sufficient knowledge of the environment
(national and local market) that can affect marketing
strategy decision making.
• The entrepreneur can begin to understand
competitors’ strengths and weaknesses, which may
provide valuable insight into how to position the
products or services of the new venture.
COMPETITOR ANALYSIS
 MARKETING RESEARCH FOR THE NEW VENTURE
• Step One: Defining the Purpose or Objectives
• Make a list of the information that will be needed to prepare the
marketing plan.
• Ask people what they think of the product or service and whether
they would buy it, and to collect some background demographics
and attitudes of these individuals.
• How much would potential customers be willing to pay for the product or service?
• Where would potential customers prefer to purchase the product or service?
• Where would the customer expect to hear about or learn about such a product or
service?
• Step Two: Gathering Data from Secondary Sources
• To obtain information that will assist the entrepreneur in
making the best decisions regarding the marketing of a
product or service.
• Trade magazines, newspaper articles, libraries,
government agencies, and the Internet
• Commercial data may also be available, but the cost may
be prohibitive to the entrepreneur.
• Step Three: Gathering Information from Primary Sources
• Involves a data collection procedure—such as observation,
networking, interviewing, focus groups, or experimentation
—and usually a data collection instrument, such as a
questionnaire.
• Questions should be designed so they are clear and concise,
do not bias the respondent, and are easy to answer.
• Step Four: Analyzing and Interpreting the Results
• The results should be evaluated and interpreted in
response to the research objectives that were specified
in the first step of the research process.
• Summarizing the answers to questions will give some
preliminary insights.
• Data can be cross-tabulated to provide more focused
results.
UNDERSTANDING THE MARKETING PLAN

• Establishes how the entrepreneur will effectively compete

and operate in the marketplace and thus meet the business
goals and objectives of the new venture.
• The entrepreneur can assign costs to these strategies, which
then serves the important purpose of establishing budgets
and making financial projections.
• It is designed to provide answers to three basic questions.
1. Where have we been?
2. Where do we want to go (in the short term)?
3. How do we get there?
 CHARACTERISTICS OF A MARKETING PLAN

• It should provide a strategy for accomplishing the company

mission or goal.
• It should be based on facts and valid assumptions.
• It must provide for the use of existing resources. Allocation of
all equipment, financial resources, and human resources must
be described. An appropriate organization must be described to
implement the marketing plan.
• It should provide for continuity so that each annual
marketing plan can build on it, successfully meeting longer-
term goals and objectives.
• It should be simple and short. A voluminous plan will be
placed in a desk drawer and likely never used. However, the
plan should not be so short that details on how to accomplish
a goal are excluded.
• The success of the plan may depend on its flexibility.
Changes, if necessary, should be incorporated by including
what-if scenarios and appropriate responding strategies.
• It should specify performance criteria that will be
monitored and controlled.
Since the term marketing plan denotes the
significance of marketing, it is important to understand the
marketing system.
STEPS IN PREPARING THE MARKETING
PLAN
1. Situation analysis describes past and present business
achievements of new venture.
The entrepreneur should provide a review of past
performance of the product and the company. It should
describe how the product or service was developed and why it
was developed. Any future opportunities or prospects should
also be
included in this section of the plan.
2. Defining the Target Market: Opportunities and Threats
provides a basis for determining the appropriate
marketing action strategy that will effectively meet its. Needs
Market segmentation is the process of dividing the
market into small homogeneous groups.
Target market is the specific group of potential
customers toward which a venture aims its marketing plan.
THE PROCESS OF SEGMENTING AND
TARGETING CUSTOMERS
I. Decide what general market or industry you wish to pursue.
II. Divide the market into smaller groups based on characteristics
of the customer or buying situations.
A. Characteristics of the customer
1. Geographic (e.g., state, country, city, region)
2. Demographic (e.g., age, sex, occupation, education,
income, and race)
3. Psychographic (e.g., personality and lifestyle)
 B. Buying situation
1. Desired benefits (e.g., product features)
2. Usage (e.g., rate of use)
3. Buying conditions (e.g., time available and product
purpose)
4. Awareness of buying intention (e.g., familiarity of product
and willingness to buy)
III. Select segment or segments to target.
IV. Develop a marketing plan integrating product, price, distribution,
and promotion.
3. Considering Strengths and Weaknesses
4. Establishing Goals and Objectives
5. Defining Marketing Strategy and Action Programs-
Specific activities outlined to meet the venture’s business plan
goals and objectives.
Product or Service- indicates a description of the product
or service to be marketed.
The product is more than its physical components. It
involves packaging, the brand name, price, warranty, image,
service, delivery time, features, style, and even the Web site that will
be seen by most customers.
• Pricing- consider three important elements:
costs, margins or markups, and competition
• Distribution- make a product convenient to purchase when it is
needed.
• Promotion- to inform potential consumers about the product’s
availability or to educate the consumer, using advertising media
such as print, radio, television, social media, and electronic
media.

• .