The Concept of Marketing Mix - Term Paper Example

MARKETING PLAN {Insert university name} {Insert instructor’s name} {Insert student’s name} July 30, 2012 Table of Contents Table of Contents 2 MARKETING PLAN 3 INTRODUCTION 3 Definition of a marketing plan 3 Marketing plan and business plan 3 Business plan 4 Marketing plan 4 Uses of marketing plans 5 Interdependency between marketing plans and business plans 5 STRUCTURE OF A MARKETING PLAN 5 Executive summary 5 Situation analysis 6 Marketing goals and objectives 7 Marketing strategies 8 Marketing mix 8 Long and short-term projections 9 Marketing implementation 9 Evaluation and control/financial projection 10 Evaluation 10 MISCONCEPTION OF MARKETING PLANS 10 CONCLUSION 11 REFERENCES 11 Armstrong, G., & Kotler, P., (2004).principles of marketing. New Jersey: Pearson Education Inc. 11 Dibb, S & Simkin, L. (2008). Marketing Planning : a workbook for marketing managers. 11 Kotabe, M., & Helsen, K. (2001). Global Marketing Management, second edition. New York: John Wiley & sons 11 Payne A, (1993). The Essence of Services Marketing, Britain: Pearson Education Ltd 11 MARKETING PLAN INTRODUCTION This report seeks to explore the concept of marketing plan. It will define the concept and relate it to the business plan. The report will further highlight the elements of marketing plan and interdependency between the elements. It will further highlight the tactical and strategically functions of a marketing plan. The structure of marketing plan will be highlighted and each element discussed. Finally a misconception on marketing plan will be included as an aspect of reflection. The report is divided into different sections which are clearly shown in the table of contents. Definition of a marketing plan Marketing plan is defined as a document that provides a vivid description of the marketing environment as well as an outline of the strategies and marketing objectives (Luther, 2001). Additionally, it specifies individuals responsible for carrying out the parts outlined in the marketing strategy. However, it is essential for organizations to decide on the particular products or services they want to market prior to design a marketing plan (Bangs & David, 2001). Marketing plan and business plan Studies have proven that both marketing plan and business plan are essential for successful operation of a business. According to Cohen (2010) business plans and marketing plans assist businesses in organizing their daily operations as well as benchmarking the failure or success of businesses. Moreover, due to the fact that organizations/businesses change with economic environment and the demands of the customers, it is essential for the marketing plans and the business plans to evolve throughout business’s lifespan (Westhood, 2010). Business plan Cohen (2010) describes business plan as any document that gives a broad view of any given business that includes information on the financial aspects, location, staff, operations and marketing in addition to goals and missions that are clearly outlined. Westhood (2010) points out that business plans are mostly used as a financial tool that provides lenders with essential information in determining the viability and financial status of the business. Even though business plans are commonly used in helping new businesses, they are essential throughout the lifetime of a business. One of the key functions of a business plan is to develop strategies that are competitive in nature. Before giving the interdependency between a business plans and marketing plan, it is essential to describe marketing plan in detail providing its tactical and strategic functions (Dibb & Simkin, 2008). Marketing plan According to Dibb & Simkin (2008) marketing plans provide detailed action that aims at achieving the goals and mission of the company. Wood (2010) in his study points out that marketing plans not only identify competition and marketing plans, but also detail price points and the business. It further provides an explanation on ways used by businesses in generating customers. Some of the ways used to generate customers include: trade shows and fairs, referrals and advertisements among other methods (Cohen, 2010). Due to the fact that marketing plans explains various ways of businesses overcoming challenges associated with competition, they are perceived as a major section in the business plans and thus they require not only detailed industry research but also consideration (Wood, 2010) Kotabe & Helsen (2001) adds that there is little differences between the marketing plan structure of a product and that of a service in the marketing mix section. In the marketing plan structure of a product there are 4 Ps i. e place, product, price and promotion while that of a service has 7 Ps which are: product, promotion, place, people, price, process and physical environment. Uses of marketing plans Wood (2010) in his work outlines various uses of marketing plans. Marketing plans are used for the purpose of clarifying business marketing elements as well as mapping out not only objectives and directions but also activities for the business as well as for the employees. Additionally, marketing plans are essential as they focuses on the issues associated with the 4Ps i.e place, price, product and promotion or the 7Ps i.e product, promotion, place, people, price, process and physical environment (Cohen, 2010). Interdependency between marketing plans and business plans Payne (1993) points out that marketing plan and business plan are interdependent for the successful operation of a business and therefore there should be an element of consistency between them. The business plan has the role of identifying the missions and goals of the business while the marketing plan provides a detailed description of how to attain the identified missions and goals. Armstrong & Kotler (2004) point out that it is essential for the marketing plan to change if there is a change in the business plan. Essentially, a marketing plan should be in line with the business plan objective and should not deviate from it. STRUCTURE OF A MARKETING PLAN According to Borden (1997) due to the fact that marketing plans should provide detailed explanations of actions that need to be undertaken to realize company’s goals and missions, it should be well written. Baker (2003) the typical outline or structure of a business plan entails: situation analysis, marketing strategies, marketing goals and objectives, executive summary, marketing implementation, and evaluation and control. The next section will describe each of the sections in detail and sequential manner giving the purpose, the content of each section and source of information for each element in a sequential manner. Executive summary Armstrong & Kotler (2004) defines executive summary as the first part of a marketing plan also called as an opening section. In this section, company’s background information is provided. The nature of the business that is the services or products is described in brief. It is essential to provide the customers and the success of the company too. The mission and objectives of the company are also included in this section of the marketing plan as it will assist in conducting situation analysis (McCarthy, 2000). It is also important to include the marketing objective and the business management team. Information regarding the same can be obtained from the management of the company or the company’s website if there is any. In this section, the objectives and goals outlined in the business plan are included (Baker, 2003). This section is important as it provides an overview of the whole marketing plan. Situation analysis This section is also called environmental analysis. According to Baker (2003) it is essential for an organization to discuss its mission statement before commencing on situation analysis. This section entails existing marketing environment. It further examines the external environmental factors such as marketing channels, political climates, technology, legal, economy, competition and the market. Additionally, the section examines internal environmental factors such as human resources, age, profits, costs and age (Hisrich, 2000). The target markets are also included in this section. Hisrich (2000) points out that it is essential for the organization to ascertain the extent at which their marketing objectives are still applicable in the changing environment. The aforementioned information can be obtained through marker research as well as from the management team. Some of the commonly used tools are: focus groups, surveys, field trials, observation, and personal interviews among other methods. The information in situation analysis section is important in helping the organization in coming up with the SWOT analysis (Solomon, 2011). SWOT analysis SWOT analysis is commonly used in marketing plans. Solomon (2011) points out that it is important for companies to have proper knowledge of not only their Strengths and Weaknesses but also their Opportunities and Threats. According to Baker (2003) for the organization to conduct a correct SWOT analysis, it is essential for the organization to know not only know about the industry but also the competition level. Payne (1993) further adds that the section considers resources available within the company and their impacts on the marketing strategies, recent changes and trends, past marketing efforts review and the marketing efforts rationale. Additionally, the section has a competition analysis. In this part, the primary competitors of the company are identified and their target markets. It is important to conduct SWOT analysis on the competitors (Armstrong & Kotler, 2004). According to Solomon (2011) SWOT analysis is essential for a company in building and focusing on its strengths as well as in taking advantage of the opportunities while eliminating or correcting strengths. Additionally, the SWOT analysis is important in coming up with marketing objectives based on the mission and goals of the business plan. Information on the same can be obtained through market research (Hisrich, 2000). The table below illustrates a SWOT analysis diagram. Figure 1 Internal External + Strengths Opportunities - Weaknesses Threats Marketing goals and objectives Westhood (2010) adds that marketing objectives are based on the company’s SWOT analysis as well as being linked to the overall strategy of the business. In this section, it is essential to state the major objectives of the company. According to Dibb & Simkin (2008) marketing objectives are important as they clearly state what the company is trying to achieve via its marketing plan. Additionally, marketing objectives assist in guiding the entire marketing plan and for evaluation purposes. Payne (1993) in his work points out that lack of objective may result into managers getting off-track thus making them fail to realize when they attained their ultimate goals. The company objectives are in terms of factors like sales volume, profitability and market share. Other factors that are included in this particular section are distribution, innovation and image. Information to be included in this section is obtained from the business plan. Marketing strategies Hisrich (2000) points out to major components of a marketing strategy as marketing mix and target market. Westhood (2010) adds that it is important for a business to have an elaborate marketing plan as they assist in enabling a company to attain its objectives. Target market Target market is not only a basic concept of marketing but also important one. According to Westhood (2010) it is important for a business to clearly identify its target market. This is because proper identification assists in creation of messages, promotional methods to be used, and resources to be used. Solomon (2011) the target should be described in terms of: marital status, income, demographics, employment status and even age. Strategies Cohen (2010) defines strategies as actions plans that give detailed description of how the four marketing variables of promotion, price, place and product are applied in achieving the marketing plan overall strategies and objectives. This section includes the 4Ps of marketing/marketing mix Marketing mix Product According to Dibb & Simkin (2008) product decisions should entail various advantages of the product in addition to ways to be leveraged. The decisions should include: package, brand name, product line scope, quality and warranty. Price Hisrich (2000) points out that it is important to discuss expected volume and pricing strategy. The decisions that should be included in this section are: Discounts, financing options and payment terms, leasing options, and list price Solomon (2011) Place (distribution) According to Solomon (2011) decision variables on place include: location, the channels of distribution, like intermediaries and distributors, retail and direct. It should also entail logistics such as order fulfillment, warehousing and transportation. Finally, there should be a decision on distributors’ evaluation criteria. Promotion This section should include the advertising and the media to be used. It further entails promotional programs, public relations, budget and promotional programs projected results Solomon (2011). Long and short-term projections Solomon (2011) highlights the importance of specifying the projections in the marketing mix as either long or short term. Hence, the section should include, the expected short and long term results and actions that need to be adopted to realize the same. McCarthy (2000) it is essential for the section to include expenses and revenues forecasts in addition to break-even analysis results. Marketing implementation Cohen (2010) points out that this section of the marketing plan provides a vivid description of the actual marketing programs that need to be undertaken with an aim of implementing the marketing strategies. Solomon (2011) in his book highlights the issues to be undertaken and they include specified actions to be undertaken, the cost of each activity, the timing and the person responsible for every activity. Below is a structure illustrating a structure for implementing an action plan. Figure 2 List of activities to be undertaken Timing of every activity Individual responsible Estimated costs Evaluation and control/financial projection According to McCarthy (2000) financial projection is essential in determining the viability and success of the marketing plan. Detailed financial projections are carried out on a quarterly or monthly basis. In most cases, the projections are in terms of market share, profits and sales volumes. According to Wood (2010) it is also important to project cost. This is because total profit + total revenue-total cost. If the organization finds out that the marketing plan is not working effectively it is essential for the management to identify the cause and instead use a contingency plan. Evaluation This is the final section of a marketing plan. Kotler (2001) points out that the function of this section is not only to measure the success but also the extent to which the objects of the company have been met. Even though, the section is usually ignored, it is essential in determining the success of the executed marketing efforts. Additionally, the section helps in giving Return on Investment reports to the constituents and members among other key players. Wood (2010) adds that there are different methods of evaluating a marketing plan and each method depend of the marketing strategies used. However, the key questions that need to be asked in this stage include: Did the company realize its marketing goals? Was the company in a position to report on Return on Investment? What was the level of the success of the marketing campaigns? MISCONCEPTION OF MARKETING PLANS One of the misconceptions is that marketing plan and business plans are one and the same thing. But from this research it is evident that business plans and marketing plans are different but they have elements of interdependency. In most cases, the marketing plan is drawn from the objectives of the business plan. Marketing plan is written after the business plan has been written. Moreover, the elements of marketing plans are interrelated and are not interdependent of each other as the assumption. CONCLUSION Marketing plans are essential for successful operation of any given business. Business plans and marketing plans are not the same but they have some interdependencies. The structure of a marketing plan can be different when it comes to marketing mix but other elements are the same and each element is linked to the other in a sequential manner. Marketing plans have both tactical and strategic functions in a business. REFERENCES Armstrong, G., & Kotler, P., (2004).principles of marketing. New Jersey: Pearson Education Inc. Baker, J.M. (2003). The Marketing Book. New York: Butterworth-Heinemann. Bangs, Jr., David H. The Market Planning Guide: Creating a Plan to Successfully Market Your Business, Products, or Service. New York: Dearborn Trade. Borden, N.H. (1997). The concept of marketing mix. New York: McGraw-Hill. Cohen, W. (2010). The marketing plan. California: John Wiley & sons Dibb, S & Simkin, L. (2008). Marketing Planning : a workbook for marketing managers. Hisrich, D. R., (2000). Marketing. New York: Barron's Educational Series Kotabe, M., & Helsen, K. (2001). Global Marketing Management, second edition. New York: John Wiley & sons Kotler, P. (2001). Marketing Management. London: Kogan page publishers. London : South-Western Cengage Learning, cop. Luther, W. (2001). The marketing plan: how to prepare and implement it. New York: American management association. McCarthy, J. (2000). Basic Marketing: A managerial approach. Homewood: Irwin. Payne A, (1993). The Essence of Services Marketing, Britain: Pearson Education Ltd Solomon, R. M. (2011).Marketing Real People, Real Choices. (7th edition). New York: Prentice Hall. Westhood, J. ().(2010). How to write a marketing plan. London: Kogan page publishers Wood, M. (2010). The Marketing Plan Handbook. New York: Pearson Prentice Hall. Read More