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.
Section 4: Tactical Marketing Decisions
This is the heart of the Marketing Plan. It contains descriptions of the detailed tactical marketing decisions to be carried out to achieve the objectives and goals established in Step 3. It is typically the longest section of the plan, often representing 50% or more of total page count.
In this section, details and timetables are presented for six key decision areas:
Target Markets
Product
Promotion
Pricing
Distribution
Other Considerations
Preferably this section includes a brief summary of current marketing decisions (see Section 2: Situational Analysis) so readers of the plan can easily compare what was planned to what is planned.
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
Section 5: Budgeting, Performance and
Implementation
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.
Section 6: Additional Considerations
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