Transcript Seppo_Monkkonen_Presentation

Marketing issues in business planning
Seppo Mönkkönen
M.Sc Agric.,
Senior Lecturer in Business Economics
Savonia University of Applied Sciences
Iisalmi, Finland
Innotools
14th April 2008
© Savonia University of Applied Sciences
| www.savonia.fi |
What is Business plan?
•
A business plan is a formal statement of a set of business goals, the
reasons why they are believed attainable, and the plan for reaching
those goals.
•
The business goals may be for-profit or non-profit. For-profit
business plans typically focus on financial goals. Non-profit and
government agency business plans tend to focus on service goals
| www.savonia.fi |
Internally or externally focused BP
•
Externally focused plans target goals that are important to external
stakeholders
•
Internally focused business plans target intermediate goals required
to reach the external goals. They may cover the development of a new
product, a new service, a new IT system, a restructuring of finance, the
refurbishing of a factory or a restructuring of the organization
| www.savonia.fi |
Content of a business plan
EXAMPLE
•
•
•
•
•
•
•
1 Executive Summary
2 Organizational Background
3 Marketing Plan
4 Operational Plan
5 Financial Plan
6 Risk analysis
7 Decision Making Criteria
•
There is no fixed content for a
business plan
•
Rather the content and format of
the business plan is determined by
the goals and audience
| www.savonia.fi |
Marketing Plan
Two aspects:
1 Understand markets and customers behavior
Point 1
Diffusion of innovations
Point 2
Producut life cycle (PLC)
Point 3
Market Segmentation
2 Marketing actions (Four P´s)
Product
Price
Place
Promotion
| www.savonia.fi |
Diffusion of innovations
| www.savonia.fi |
Cumulative diffusion of innovations
| www.savonia.fi |
Product life cycle
| www.savonia.fi |
• Market introduction stage
» cost high
» sales volume low
» no/little competition - competitive manufacturers
watch for acceptance/segment growth losses
» demand has to be created
» customers have to be prompted to try the product
• Growth stage
»
»
»
»
»
costs reduced due to economies of scale
sales volume increases significantly
profitability
public awareness
competition begins to increase with a few new
players in establishing market
» prices to maximize market share
| www.savonia.fi |
• Mature stage
» Costs are very low as you are well established in
market & no need for publicity.
» sales volume peaks
» increase in competitive offerings
» prices tend to drop due to the proliferation of
competing products
» brand differentiation, feature diversification, as each
player seeks to differentiate from competition with
"how much product" is offered
» Industrial profits go down
• Decline or Stability stage
» costs become counter-optimal
» sales volume decline or stabilize
» prices, profitability diminish
» profit becomes more a challenge of
production/distribution efficiency than increased sales
| www.savonia.fi |
| www.savonia.fi |
| www.savonia.fi |
Market Segmentation
• A market segment is a subgroup of people or organizations sharing
one or more characteristics that cause them to have similar product
needs
• A true market segment meets all of the following criteria:
1. it is distinct from other segments (heterogeneity across segments)
2. it is homogeneous within the segment (exhibits common attributes)
3. it responds similarly to a market stimuli
4. it can be reached by a market intervention
| www.savonia.fi |
EXAMPLE
| www.savonia.fi |
| www.savonia.fi |
Three possible strategies after market sementation
1. No segmentation in marketing
=> Same marketing to everybody
2. Concentrated marketing
=> Marketing for only one segment
3. Segmented marketing
=> Different marketing for different segment
| www.savonia.fi |
| www.savonia.fi |
| www.savonia.fi |