Marketing is a business discipline. The Institute of Marketing defines marketing as 'the management process responsible for identifying, anticipating and satisfying customer requirements profitably'. That sounds rather a mouthful; in simpler words, marketing is about finding and satisfying customers - identifying the need for a product or service and then providing it at the right time, in the right place and at the right price.
Marketing covers all aspects of your business, from defining your product or service to the identification of market opportunities and filling those opportunities at a price that covers your costs and generates a profit.
Too many businesses define their market by looking at the product or service they are providing; that is, they are product-led. Whilst sometimes that can be effective, in most cases businesses need to be market-led: they should be looking at, and planning, everything from the viewpoint of the customer, identifying what needs customers are seeking to fulfil when they buy a particular product or service.
Careful planning increases the chances of successfully accomplishing what you set out to achieve. The principles of good planning can be applied to almost any project and remain the same irrespective of the task. However, the outcome of planning, the plan, can differ according to the nature and purpose of the task.
There are three stages in the process of preparing a marketing plan.
The final outcome of your marketing plan very much depends on your approach to customer targeting and how you decide to position your products or services in the marketplace.
Once you are clear about your target market and about the position you propose to adopt in the market you can begin to define some marketing objectives. The first of these might be the purpose of the business: be as specific as possible regarding the business area in which you will operate, eg product type, customer groups, market needs, etc. For example:
to provide toys and games for children under 12 years old.
to provide an environmentally friendly range of packaging materials for use in the food industry.
The marketing mix is made up of the following elements, often referred to as “the four Ps”:
Product (or service)
Place (location and distribution)
For a business to succeed, you need to:
get all of the elements right
strike a balance between the elements
By stating how you intend to deal with each of the 4Ps you will have begun to create a set of task objectives.
If you opted for a cost focus positioning approach you might note under ‘product’ that, amongst other things, there is a need to add a particularly important feature to your product and also reduce the cost of some aspect of the production process. You may already have some idea of how to tackle cost reduction, in which case your task objectives stemming from this point will be to:
Whatever the stage of your business development, looking at the future may be helpful in defining your marketing objectives and your marketing mix.
The most common objectives are usually to achieve sales and profitability targets in year one and to increase sales and profitability levels in subsequent years. Bearing this in mind, how can you develop your product, service or customer groups to achieve this business growth?
By examining the product/market matrix below you can identify the major classes of growth opportunities:
Developing a corporate identity is important as it will make your business:
- look professional;
- more appealing to potential customers/clients; and
- look established and appear bigger than it really is.
Your corporate identity will impact on how your employees (if you have any), suppliers and customers see your business. Ask for their opinions on how they see your business and use this feedback to help develop your desired corporate identity. Also look at other companies, both large and small, and see how they have successfully cultivated their image.
The first thing any potential customer finds out about your business is its name. The name that you choose is an important element in communicating your message. Short names are best; it is not by accident that brand names in the very competitive detergent market have names like Ariel, Daz and Lenor, or in the soft drinks market, Coke and Pepsi. Since you will have less to spend on achieving brand recognition, the name should ideally give some indication of what the business does rather than being, say, a combination of the partners’ names.
The greatest danger when setting a price for the first time is to pitch it too low. Raising a price is always more difficult than lowering one, yet there are great temptations to undercut the competition. It is clearly important to compare your prices to your competitors’, but it is essential that your price covers all your costs. There are a number of possible pricing strategies from which you might choose. These include: