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Strategic Market Planning
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There are two major components to a Marketing Plan:
 | how your business will address the competitive marketplace |
| how you will implement and support the day to day operations of your
business |
In today's competitive marketplace a strategy that takes a consistent
approach to offering your products or services in ways that differentiate you
from the competition is critical. In concert with defining the marketing
strategy you must also have well defined day to day processes in place to
implement it. There is little value in having a strategy if you lack the
resources or the expertise to implement it.
The process of creating a marketing strategy includes many factors that must be
considered. Some of the more important factors are:
| Deciding what the overall objective of your business should be.
 | If the market is very attractive and your business is one of the
stronger in the industry you invest your best resources in support
of your offering. |
| If the market is very attractive but your business is one of the
weaker ones in the industry you intensify efforts on strengthening the
business, using your offering as a passage toward this objective. |
| If the market is not attractive, but your business is one of the
stronger in the industry then a well planned marketing and sales effort
for your offering will generate near term profits. |
| If the market is not attractive and your business is one of the weaker
ones in the industry you should promote this offering only if it
supports a more profitable part of your business Otherwise,
you should determine the most cost effective way to divest your business
of this offering. |
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| Choosing a strategy for the offering that will be most effective in the
market.
| Cost Leadership Strategy
 | Produce and market a good quality product or service at a lower
cost than your competitors. These low costs should translate to
profit margins that are higher than the industry average. |
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| Differentiation Strategy
| Creating a product or service that is perceived as being unique
with customers. The differentiation can be on brand image,
proprietary technology or superior service, to name a
few. This uniqueness should translate to profit margins
higher than the industry average. I |
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| Focus Strategy
| Focusing on a segment of the marketplace when it isn't
feasible to attempt an "across the board" application of
cost leadership or differentiation. It is based on the concept of
serving a particular target in such an example nary manner,
that others in the industry cannot compete. This usually means
focusing on a smaller market segment than others in the industry
where there is minimal competition, creating the opportunity for
very high profit margins. |
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| How you will price the offering.
| Skimming Strategy
| If your offering has enough differentiation to justify a higher
price and you wish to maximize margin contributions and have no
desire to gain significant market share, then you set your prices
very high. |
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| Market Penetration Strategy
| If near term income is not critical and rapid market share growth
for eventual market control is desired, then you set your prices
very low. |
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| Comparable Pricing Strategy
| If you are not the market leader in your industry then price
your offering comparably to those of your leading competitors. |
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| How you will effectively promote and advertise your offering
| Push Strategy
| Maximizes the use of all available channels of distribution to
"push" the offering into the marketplace. |
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| Pull Strategy
| Direct interface with the end user of the offering. The
objective is to "pull" the prospects into the various
channel outlets creating a demand the channels cannot ignore. |
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| How will you distribute your offering to get into the hands of the
customer
| On-premise Sales |
| Direct Sales |
| Wholesale Sales |
| Self-service Retail Sales |
| Full-service Retail Sales |
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Making decisions about your products/services, pricing, promotion and
place/distribution (the "4 P's" of marketing) is a necessary
exercise when developing a marketing plan.
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