Transcript Develop_a_Marketing_Plan

Develop a Marketing Plan for
Your Direct Marketing
Activities
Wen-fei Uva
Senior Extension Associate
Department of Applied Economics and Management
Cornell University
Ithaca, NY 14853
Modified by Georgia
Agriculture Education
Curriculum Office
June, 2002
Marketing is:
• Marketing is EVERYTHING you do to
promote your business, from the moment you
conceive of it to the point at which customers
buy your product or service and begin to
patronize your business on a regular basis.
»
Jay Conrad Levinson (“Guerrilla
Marketing”)
• The key words to remember are everything
and regular basis.
Basic Elements of Marketing
1. Research
2. Analysis
3. Strategies and Tactics
Marketing 4 Ps:
Product, Price, Promotion, Place
(& People, Process, and Presentation)
A Marketing Plan is a Road Map
Strategies you will utilize
to achieve your goals.
•
•
•
•
•
•
Budget
Calendar
Responsibilities
Deadlines
List of tools
Media List
•
Events / Activities
Promotion
Products
Target
Market
Place
Price
Five Steps of Developing a
Marketing Plan
1. Strategic planning to identify marketing
opportunities (SWOT Analysis) - look at
the big picture and a longer time-horizon
2. Select target markets -- only the segments
that you can satisfy in a superior way
3. Develop a marketing mix (4 Ps) to support
the product’s positioning
4. Implementing the marketing strategy
5. Control phase
Set Goals and Objectives
• Translate the plan into quantifiable and
measurable terms -- so you can evaluate it
• Real Goals and Objectives
What is it you want to achieve?
 This year?
 Over the next 3 years?
 Over the next 10 years?
• How reasonable are those goals?
• Don’t set yourself up to fail!
Determine Your
Target Markets
Promotion
Products
Target
Market
Place
Price
A Target Market is a group of customers
(people or firms) at whom your business
focuses its marketing effort.
 The target market consists of the individuals
or businesses that you identify as the MOST
DESIRABLE CUSTOMERS -- Not whoever
is now buying or will buy your products
 Determining a target market can help
identify a COMPETITIVE ADVANTAGE
for the firm in the market.
Choice of target market will
determine your marketing
strategy not vice versa
Know Your Target Market
• Demographic
• The psychological determinants & social
factors
• Market Segmentation - consumers and
competitors
• Determine why customers buy your product
or service for each market segment
 Who are your most profitable customers?
 What is important to them
 When, where, how and what do they buy?
 Read what they read..
4 Primary Motivators of Today’s
Consumers
 Convenience - On-the-go foods, meal
solutions, and functional packaging
 Wellness - Fear about aging, declining
health, and increasing medical costs; Look
for products offer health benefits
 Food Quality and Safety- Quality is the
basic
 Gratification - I am worth it, Help them
succeed
Make Sense of Your Position
• Your strength and weakness
• Your competitors’ strength and weakness
• Find out your position in customers’ mind
– The Best Product
– The Best Total Costs
– The Best Solution - best product mix, best
service, convenience, customization
Choose Your Marketing Position and
Differentiate Yourself
Product Strategies
Promotion
Products
Target
Market
Place
Price
•
What are your products and/or
services
 Sell the benefits not just the product
 Give your customer a REASON to buy
your products
•
Agricultural products and services
are often generic. -- Differentiate
your products and service is the
ONLY way to enhance sales and
prices.
Ways to Differentiate Your Product
• Physical Characteristics: features, performance,
durability, packaging
Value-added, Convenient
Something
Bigger or Better
Something Unique
• Availability: stores, by phone, fax or internet,
diversity
Product Diversification
7
6.0
6
5.6
5
# of retail activities
6.2
4.7
4.5
4.1
4
3.7
3.2
3
2
1
0
Less than $10,000$10,000
24.999
$25,00049,999
$50,000- $100,000- $250,000- $500,000
99,999
249,999 499,999 and over
Total
• Service: delivery, installation, guarantee, training,
maintenance, repair
Think for your
customers
Think like
your
customers
Share your knowledge
The teachable moment
• Image: symbol, event, media, information
Make the image tangible
Something for
the kids
Make it close to
home
Make it fun
Ways to Differentiate Your Product cont.
• Price: from very high to very low
Pricing Strategies
“VALUE” to consumers
= Quality + Service + Information + Price
Pricing Questions
• How much do your competitors charge?
• How much are customers willing to
pay?
• Does your product or business have
additional value/image for which price
may be raised?
• What is your cost to produce the
product? -- Pricing for profit
Cost Accounting 101
Price
(Revenue)
Contribution
Variable Costs
Break-even
Fixed Costs
Profit
(variable cost are items that
vary with production )
(fixed costs are items that
do not vary with
production)
Profit Equation
Fixed Costs ($)
Unit Costs ($)
=
+
Variable Costs ($)
Units Produced (lbs, dozens, bag)
(Don’t forget to take into account shrinkage)
VOLUME (PRICE-COST)
=
PROFIT
Some Pricing Strategies
Price-Lining
- Feature products
at limited prices
Single-pricing
- Charge same
price for all items
Everyday low price
- a value image
Odd-ending pricing
• $.99, $.49 endings
• How about $.50 ending?
Not for
Farmer’s
Market
Volume pricing
- 1 for $2.50; 2 for $4.99 (or $5.00)
- No real discount
Quantity discount pricing
- One for $2.00 and three for $5.00
- Encourage people to buy more
Cumulative pricing
- Base on the total volume purchased over
a period of time
- Incentive for return purchases
Trade discount/Promotional
allowances
- Reduction in price for marketing
function buyers will perform
Cash discount
- Encourage buyers to pay their
bills early/on-time
Seasonal discount
More Pricing Reminders
•
Price clearly
•
Having the “Lowest Price” in the town
image can’t get you higher prices for
higher quality.
Place Strategies
Promotion
Products
Target
Market
Place
Price
Place/Distribution Strategies
Depend on the target market’s needs & wants,
and where you have a competitive edge.
 Farmers markets

Pick-your-own farms

Farm stands/ Value-added products

Entertainment farming/Agri-tourism


Community supported agriculture (CSA)
Cooperatives

Mail order/ Internet

Wholesale: supermarket, restaurants,
brokers, etc.
Direct Marketing Methods
80
77
77
70
60
50
40
38
% 40
30
20
8
10
9
10
8
1
3
4
1
0
Roadside
stands
Farmers'
market
Pick-your own
fields
% of businesses
Mail
order/internet
CSA
% of total industry sale
Others
More Than Just Retailing
A New York survey shows that direct marketers
utilized an average of 2.3 marketing channels
Marketing Channels
Wholesale
Retail
Supermarkets
Other farm
markets
Food-service
Other
wholesalers
% of
respondents
36
48
22
29
100
% of total
surveyed farm
sales
8.2
13.7
4.1
29.1
44.8
Promotion Strategies
Promotion
Products
Target
Market
Place
Price
Five Promotion Tools
1. Advertising
 Paid communication - TV, radio, newspaper, etc.
 Change mind don’t change behavior
 Select the appropriate media -What do they listen
to? What do they read?
2. Sales promotion
 Coupons, in-store displays, trade shows, samples,
in-store demonstrations, and contests.
 Change behavior - Most recalled advertisement
 Supplement and coordinate efforts in the advertising
and personal selling efforts.
Five Promotion Tools - cont.
3. Public relations
 Non-paid communication presented by the media.
Publications, Events, News, Community
involvement, Identity media, Lobbying activity, etc.
 Create a positive image
4. Direct marketing/mailing
 Most Targeted
 Database marketing
5. Personal selling
 Employee is your most important asset
 Don’t forget training
Design a Multi-Media
Promotion Strategy
• Target market demographics
 age, gender, location, education, occupation,
income level, household type, marital status
• Be conscious of psychographics (motivators)
 needs, values, buying styles, cultures, interests
• Consider your differentiation marketing position
• Be Small but don’t Look Small
• Communicate & Celebrate
 Don’t forget your customers and don’t let
customers forget you!
om
ire
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(8
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(7
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lin
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io
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Effectiveness of Marketing Tools
5
4.5
4.2
4
3
4.1
4.0
3.9
3.7
3.6
3.2
3.2
3.2
3.2
2.8
2.2
2
1
“Word of Mouth” Promotion -Need to Generate Publicity
Ability to Write
Press Releases
• Anyone can write a press
release - Will it get
printed?
• Key elements of a good
press release:
Title – Who - What
When - Where
Utilize the first
paragraph to
summarize the entire
release.
 Add the details starting with
the most exciting.
 Closing statement to
encourage participation.
 Let press know more
information and photos are
available.
 At least one press release per
month and work your way
up to two.
When to Promote?
Monthly Sales
as %
of Total Industry
Sales by Month
% of Surveyed
Direct
Marketing
Sales,
18
17
16
Percent of Total Sales
16
14
13
12
13
11
11
10
8
6
6
5
4
4
2
3
1
1
0
Jan Feb Mar Apr May Jun
Jul
Aug Sept Oct Nov Dec
Marketing Budgets
Urban (N=38)
Rural (N=84)
All respondents (N=122)
7
6.0
Marketing budget as % of total retail sales
6
4.8
5
4.8
4.4
3.8
4
3.4
3.3
3.4
3.2
3.1
2.9
3
2.4
2.4
2.0
2.4
2.0
2
1.5 1.5
1.7
1.5
1
0.5
0
< $10,000
$10,000 24,999
$25,000 49,999*
$50,000 99,999*
$100,000 249,999**
>=$250,000
total
3 Additional Ps
- in the Experience Economy
Processes- Businesses need to develop
orderly, efficient processes to take care of
customers,
Easy In;
Easy Out
e. g. U-pick operations need to design a
systematic way to handle customersparking, containers, assigning rows or areas
to pick, and handling the cash register.
People- personnel expenses represent the
largest category of cash expenses.
It was identified by New York Direct
Marketers as the number 1 barrier to
success.
 Especially important for businesses with a
service component
Your Staff is the Most Important
Marketing Asset
• Friendly, courteous • Fact: Customers will return to
your business if they are unhappy
and knowledgeable
with a product but will not return
staff
if they are unhappy with an
employee.
They are a reflection
of your business
even more so than
your signs, your
displays and your
products, because
they talk.
• Fact: Customers will patronize
your business if they are treated
pleasantly even if your prices are
higher.
• Fact: Customers will remember
your business by the person who
took care of them more than by the
product they purchased.
• Put your grumps in the back!
Employees Training 101
Some of Simple Customer Service Techniques
 Double check
 Pretend it’s you
 Get involved
 Stay focused and Listen
 Ask questions and Listen
 Do something extra
 Smile - show your teeth
 Use a complete sentence
 Care
 Laughter
Presentation- This could be
considered as the “PACKAGING” of a
business.
Customers often form opinions of a
company and its service on the basis of
the presentations.
Implementing and Control Phase
• Evaluate Goals & Objectives
• Budgeting
 In addition to financial budgets
 Time: Good marketer spends 1520% of his/her time marketing
 How many of us can afford to spend
this much time marketing?
 The real question is…how many of
us can afford not to spend this much
time marketing?
Implementing and Control Phase
• Action Plan and Timeline:
 Who is responsible?
 What tasks are they
responsible for?
 When the tasks are to be
completed?
• Monitor, Evaluate
• Don’t be Shy to Revise the Plan
• Identify New Markets/Diversification
 Product mix, other enterprises/mktg channels, new
buyers, expand season
 Purchase to resale
• Add Services
 Delivery, quality, add hours
• More Marketing
 Promote local family farm reputation, image, and
tradition
 Building strong customer loyalty/relationship
• Become more efficient
 Reduce input use holding price and product


quality
Become a cost leader
Exploit quality differences to increase revenue
more than costs (size, color, taste, variety, etc.)
• Strategic alliance and collaboration
• Reduce Risks -- crop insurance, self insurance,
estate planning