Transcript Marketing planning

Marketing planning
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Key Terms
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Product Life Cycle
Marketing Budget
Test marketing
Sales forecasting
Marketing Planning
• Develop tactics to support the marketing
strategy
• Sets targets
• Develops different elements of the mix
• Allocates funds to different activities
• Decides on a time schedule
Advantages and Disadvantages of
marketing planning
• ADVANTAGES
• Sets out in detail what it wants
to achieve
• Managers can review firms
progress by comparing actual
outcomes with planned
outcomes
• It forces managers to think
ahead and consider what
might happen
• Provides direction
• DISADVANTAGES
• The plan may become out of
date with changes to the
market
• Can take up a lot of time and
delay vital decision making
Evaluation of the plan
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Is it realistic?
Does it help achieve the strategy?
Is it affordable?
Does it fit with the firms strengths?
Sales Budget
A target level of sales for a product (actual or
market share) – SALES BUDGET
Size is dependent on:
– Past sales of the product
– Expenditure budget
– Market conditions
– Objectives and strategy
Expenditure Budget
A target level of expenditure a firm sets to achieve its
marketing objectives – EXPENDITURE BUDGET
• Size depends on:
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The firms overall financial position
The firms marketing objectives and strategy
The amount the firm expects to receive back
Competition
Sales forecasting
• This sets out targets for overall sales for
products and is a goal for the firm to
achieve
• It influences other decisions:
– Production schedule
– Cash flow forecast
– Human resources decisions
Producing a Sales Forecast
• It may be based on historical / back data
• The firm can use market research to try and
identify likely future trends
• It may be based on the firms best guess
• Nature of the forecast depends on nature of the
firms product and the market situation
Problems with forecasts
• Customer-buying behaviour suddenly
changes
• Original market research was poor
• The experts got it wrong
Reliability of Forecasts
• Forecasts are most likely to be correct when:
– Trend has been extrapolated and market conditions
continued as before
– Test market is used and represents entire population
– Forecast is made by experts
– Firm is forecasting in the near future