How to Write a Marketing Plan – Part 2

In Part 2 of our highly detailed How to Write a Marketing Plan tutorials, we extend what was covered in How to Write a Marketing Plan Tutorial – Part 1 by focusing on the key decision areas that marketers must address. Overall, this section of the Marketing Plan is often the most time consuming and, consequently, will likely represent the most detailed section of the entire plan. And, as would be expected, it will likely be the section of the plan that will require the most time to produce. For marketers who are using the plan to obtain spending increases or for marketers who are seeking funds from outside sources, this part of the plan, and in particular Section 4, will be the most important part of the entire plan.

1. Tactical Decisions: Target Market

If the target market remains the same as what was identified in the Situational Analysis, then identifying the market will be relatively easy, though justification for continuing with this market is required. For new markets, a more detailed discussion is needed. This section also includes the sales forecast, which is the driving force for all financial forecasts. Depending on the depth of detail sought in the Marketing Plan, it may be a good idea to include likelihood scenarios, such as best case, worst case and probable case, when developing the sales forecast. (Length: 1-2 pages)

1. Target Market Description

• Brief summary of current target market

• Identify planned changes:

  • Summarize changes:

    • Describe using profile (e.g., demographic, psychographic, behavioral, etc. )

    • Describe how it will be accomplished

  • Justify planned changes:

    • Due to results

    • Due to research

    • Due to competition

  • Others

• Describe tactics to carryout changes:

  • Objectives

    • e.g., percentage of target market that will buy

  • Methods used to change the target market

2. Product Positioning

• Brief summary of product position

  • How does target market view product in relation to competitor’s products?

• Identify planned changes:

  • Summarize changes in product positioning

  • Justify planned changes:

  • Due to results

  • Due to research

  • Due to competition

  • Others

• Describe tactics to carryout changes:

  • Objectives

    • e.g., what is desired position?

  • Methods used to change position

3. Sales Forecast for Each Product

• Brief summary of current sales

• Identify changes

  • Summarize changes in forecast

  • Justify forecast (i.e., figures determined based on what information?)

• Describe forecast

  • Objectives

    • e.g., why is forecast method used?

  • Methods used to carry out

  • Numerical estimates

    • Categories:

      • Total

      • By segment(s)

      • By distribution channel

      • Others

  • Consider likelihood scenario analysis

2. Tactical Decisions: Product

In this section, discuss the tactical product decisions to be made for existing or new products and services. Make sure to consider all aspects of product decisions (branding, labeling, packaging) and not just the product itself. Also, keep in mind product decisions can also impact distributors (e.g., distributor’s response to packaging used to ship the product). (Length: 1-3 pages)

1. Brief Summary of Current Product Decisions for Users and Distributors in Terms of:

• General description

  • e.g., category of product, product line information

• Features/attributes offered

  • list key features

  • main benefits target market receives

• Branding

• Packaging

• Labeling

2. Identify Planned Changes

• Summarize changes

  • For existing products:

    • Explain key changes

  • For new products address:

    • How was product developed?

    • Stage in development process

    • Timetable for availability

• Justify changes:

  • Due to results

  • Due to research

  • Due to competition

  • Others

3. Describe Planned Changes

• Identify changes directed to the targeted user market:

  • Objectives:

    • e.g., modify existing products, extend existing product line, develop new products, develop new uses/benefits for existing products, delete current product, etc.

  • Features/attributes offered

  • Branding

  • Packaging

  • Labeling

• Identify changes to the distributor network:

  • Objectives:

    • e.g., improve distribution, improve protection, lower cost of handling, gain distribution, etc.

  • Features/attributes offered

  • Branding

  • Packaging

  • Labeling

3. Tactical Decisions: Promotion

Describe the decisions related to how the product will be promoted. In general, promotion consists of four major areas – advertising, sales promotion, public relations, and personal selling – though not all may be used. Timetables for promotion are important since certain types of promotions (e.g., magazine ads, trade shows) require long lead times. Most information in this section can be shown in tables and graphs. Each of the four promotion areas is separated out, however, some planners find it easier to combine the areas. For instance, the promotional areas could be combined within special promotion programs, such as Holiday Promotion Program, Summer Promotion Program, etc. (Length: 1-4 pages)

1. Brief Summary of Current Promotional Decisions For Users and Distributors in Terms of:

• General description for four promotional areas:

  • advertising

  • sales promotion

  • personal selling

  • public relations

• Message/theme

• Methods used:

  • Summarize methods used

  • Summarize spending for each method

• Interrelation of four promotional areas

  • e.g., explain how advertising supports sales promotion

2. Identify Planned Changes

• Summarize changes

• Justify changes:

  • Due to results

  • Due to research

  • Due to competition

  • Others

3. Describe Planned Changes

• Identify changes directed to the targeted user market:

  • General description for four promotional areas

  • Objectives

    • Advertising – e.g., build general awareness/inquiries/traffic, encourage product trial, shift awareness (e.g., change attitude), response to competitor promotion, increase use or purchase rate, support other market decisions (e.g., support sales force), general corporate/product image building, etc.

    • Sales promotion – e.g., build inquires, increase product trial, encourage repurchase, build traffic, support other promotions

    • Personal selling – e.g., new account development, account support/maintenance, increase product trial, encourage purchase/repurchase, build traffic, support other promotions

    • Public relations – e.g., build general awareness/inquiries/traffic/customer involvement, encourage product trial, shift awareness (e.g., change attitude), respond to negative news/perception, image building, prepare markets for future activity (e.g., new product)

  • Methods and message

    • type and media used: e.g., ad type (e.g., television spots, digital ads, roadside billboards, direct mail, etc.) , sales promotion type (e.g., coupons, products demonstrations, etc.), selling type (e.g., sales force, call center), PR type (e.g., social media, press release, pitch to media, etc.)

    • message conveyed

  • Spending and timetables

    • total spending

    • sub-divided by:

      • type

        • e.g., ad spending, sales force compensation

      • media used

      • targeted users

• Identify planned changes directed to the distributor network:

  • General description

  • Objectives

    • Advertising – e.g., build general awareness/inquiries, encourage product handling, shift awareness (e.g., change attitude), response to competitor promotion, increase purchase rate, support other market decisions (e.g., support sales force), general corporate/product image building, etc.

    • Sales promotion – e.g., build inquires, encouraging inventory building, support other promotions, encourage handling of new products, obtain distributor assistance

    • Personal Selling – e.g., new account development, account support/maintenance, encourage purchase/repurchase/inventory building

    • Public Relations – e.g., build general awareness/inquiries, encourage distribution trial, shift awareness (e.g., change attitude), image building, prepare markets for future activity (e.g., new product)

  • Methods and message

    • type and media

    • message conveyed

  • Spending and timetables

    • total

    • sub-divided by:

      • type

      • media used

      • targeted distributor network

4. Tactical Decisions: Distribution

This marketing tactics section lays out the distribution plan for the product or service. Distribution is a broad concept that includes all activities and entities (e.g., value chain partners) responsible for getting the product or service to the customer. Distribution costs can represent a high portion of the overall cost of the product so an efficient distribution system may be critical for marketing success. (Length: 1-3 pages)

1. Brief Summary of Current Distribution Network/Value Chain Decisions

• Types of channels used:

  • direct – e.g., direct via sales force, internet, etc.

  • indirect – e.g., retailers, wholesalers, agents

  • combination

• Level of market coverage:

  • intensive – e.g., mass availability

  • selective – e.g., wide availability

  • exclusive – e.g., restricted availability

• Outlets handling product:

  • types

  • number/level of penetration

  • geographic location

• Perceived product positioning:

  • in relation to competitors

• Distribution costs

2. Identify Planned Changes

• Summarize changes

• Justify changes:

  • Due to results

  • Due to research

  • Due to competition

  • Others

3. Describe Planned Changes

• Objectives:

  • e.g., account development, gain distributor support, account maintenance, account penetration

• Types of channels employed

• Level of market coverage

• Outlets handling product

• Product positioning

• Distribution costs

5. Tactical Decisions: Pricing

Pricing decisions can be a complicated undertaking that requires knowledge of the market, competitors, economic conditions and, of course, customers. For this section, it is not necessary to provide extensive financial evaluation of the pricing decision since most of this will take place in Section 5 Budgeting and Implementation. However, the use of tables and graphs may be helpful in showing pricing trends and pricing decisions within various categories. (Length: 1-2 pages)

1. Brief Summary of Current Pricing Decisions

• Describe pricing decisions by:

  • model/product

  • segment

  • channel

  • geography

  • other

• Adjustments and Allowances

  • discounting

  • payment terms

2. Identify Planned Changes

• Summarize changes

• Justify changes:

  • due to results

  • due to research

  • due to competition

  • other

3. Describe Planned Changes

• Objectives

  • e.g., return on investment, market share, profit level, price leadership, match competition, etc.

• Factors affecting price setting

  • Cost factors

    • fixed costs to be covered

    • variable costs

  • Customer expectations

  • Company expectations

    • e.g., margins, ROI

  • Demand considerations

    • market elasticity

    • position on product life cycle

  • Competition

  • Economic conditions

  • Legal/regulatory considerations

• Pricing Options

  • list, preferred or suggest pricing

  • adjustments and allowances

  • sub-divided by:

  • product/model

  • customer

  • channel

  • other

6. Tactical Decisions: Other Issues

(Note: Coverage of these items may not be applicable for all Marketing Plans.)

In this section, include a discussion of other marketing decision areas. Two additional areas – customer support service and marketing research – are provided though it is possible others exist. (Length: 1 page or less each)

Customer Support Services

1. Brief Summary of Current Customer Support Services Decisions

• types offered:

  • e.g. call center, online, text, service desk, walk-up, on-site

• customers being serviced:

  • e.g., current customers, potential customers, distributor network

• service delivery method:

  • e.g., internally managed, contracted, partnership arrangement

2. Identify Planned Changes

• Summarize changes

• Justify changes:

  • Due to results

  • Due to research

  • Due to competition

  • Other

3. Describe Planned Changes

• Objectives

  • e.g., availability, response time, satisfaction level

• Types offered

• Customers being serviced

• Service delivery method

• Spending and timetables

Marketing Research

1. Brief Summary of Current Marketing Research Efforts

• Projects

  • e.g., completed, in process, under consideration

• Research responsibility

  • e.g., internally managed, contracted, partnership arrangement

2. Identify Planned Changes

• Summarize changes

• Justify changes:

  • Due to results

  • Due to research

  • Due to competition

  • Other

3. Describe Planned Changes

• Objectives

  • e.g., customer analysis, market analysis, competitor analysis, exploratory

• Projects

• Service responsibility

• Spending and timetables

In many ways, this part of the Marketing Plan is the area that will ultimately “sell” the plan to those who have the power to give final approval. This step consists of three key topics:

1. Setting the Marketing Budget

This section on setting the marketing budget should present a clear picture of the financial implications of the plan by laying out spending requirements necessary for meeting the plan’s objectives. It is expected that several tables and graphs will be presented along with narratives explaining important budget issues. (Length: 2-3 pages)

1. Outline Spending Requirements for Each Tactical Marketing Decision

• Breakdown each tactical category

  • e.g., types of advertising, types of services offered, marketing research expense, etc.

• Show detailed spending timetable by:

  • Month

  • Year

• Show spending by:

  • Product (if plan is for more than one)

  • Segment/Geographic area

  • Distribution Network/Channel

2. Performance Analysis

This section should present the expected results of the plan and should contain various performance metrics, including the financial implications of the plan in terms of contributions to the company’s bottom line. HOWEVER, as was stated in the beginning of the Marketing Plan tutorial, the marketing plan is generally a component of a larger business plan. We do not cover a full financial discussion, such as a full balance sheet, income statement, detailed ratio analysis, etc., though these could be included if necessary. Again, numerous tables and graphs should be presented. (Length: 2-3 pages)

1. Marketing Contribution

• Show revenue versus expenses for marketing decisions

  • Revenue should follow sales forecasts (see Section 4)

  • Show expenses by category (e.g., advertising) and sub-category (e.g., types of advertising)

• Breakdown by:

  • Product

  • Segment/Geographic area

  • Distribution Network/Channel

2. Breakeven Analysis

• Primarily for plans involving the sale of tangible products, the breakeven analysis indicates the level of sales (generally described in terms of number of units sold) required before the organization realizes positive marketing contribution.

• Requires understanding of:

  • Fixed costs – cost that occur no matter level of sales

  • Variable costs – cost that may change as level of sales varies

• Present as both graph and chart

  • Show breakeven point over level of sales volume

    • From zero through best scenario sales level

  • Show breakeven over time

3. Ratio Analysis

• Limit to important marketing ratios that are common to the industry

  • e.g., sales cycle, advertising-to-sales, conversions from trial to purchase, website traffic-to-search engine marketing, etc.

3. Implementation

This section discusses how the plan will be carried out, offers timelines, and identifies those responsible for performing tasks . (Length: 1-2 pages)

1. Detailed Schedule of Tasks and Those Responsible

• Breakdown by important tactical marketing decisions

  • Best presented in a Gantt chart format

• Identify those responsible for each important task:

  • If unsure leave generic

    • e.g., sales department, advertising agency, consultants, distributors, etc.

The final major section in the Marketing Plan prepares the reader for potential situations that may affect the plan. In this way, the reader is provided with a somewhat more balanced picture of what the organization may face as it attempts to implement the plan. (Length: 2-3 pages)

1. Internal Factors

• Discuss organizational factors that may affect the plan

  • e.g., loss of funding sources, loss of key personnel, current plan is linked to success to other products that may not reach their goals, production problems, etc.

2. External Factors

• Discuss outside factors that may affect the plan

  • e.g., supply chain problems, competitor reaction, technological developments, legal environment, societal changes, economic issues, governmental concerns, etc.

3. Research Limitations

• Discuss problems that may exist with the research information on which assumptions are being made

  • e.g., difficult to find solid data on a certain subject