Over the past months, we’ve looked at six different marketing topics that will become components of your Marketing Plan. This month, we’re going to talk about the steps in devising your marketing strategy.As you’ve no doubt gathered by now in this series, the differences between different areas of marketing can be rather subtle. So, perhaps the best way to explain how Public Relations differs from Reputation Management or Customer Relations, is with some examples.
Setting objectives for your marketing plan is all about math. Considering your business model, overall business objectives, and customer purchasing data, think about what you need to accomplish with your marketing. If 50% of your existing customers spent an additional $10 a month, would you reach your business objectives? Would a 25% increase in your customer base be sufficient, or do you need to double it? Is there a sufficient population of your target market in the geographic area you currently serve or do you need to expand? When you’ve done your research and calculated the various options, your objectives should be stated as precisely as possible, and in measureable terms. For example:
- Over the next three years, we will increase our customer base by 25%, bringing in 500 new customers.
- In each of the next three years, we will increase the average sales per customer, per month by 10% to a total of $60.
- By June 2019, 20% of our customers will be in the United States.
Setting a Budget
Establishing a feasible marketing budget can be difficult, particularly when you view it only as an expense. The fact is though, that marketing is an investment on which you expect a return. That is, for every dollar you spend, you should earn at least a dollar back. If you earn one dollar and five cents on each dollar spent, your “return on investment” (ROI) is five percent.
The easiest way to set an actual number is to start at 10% of gross revenue, and then add to that.
Consider your current position in the marketplace. If you’re facing stiff competition, you’ll need to invest more to maintain your market share – and even more if you’re looking to pull customers away from an established brand. (Think Coke vs. Pepsi.)
Consider your objectives. Moving into new territories is going to cost more than upselling to your current customers.
Also consider your business plan and objectives. Are you planning to launch a new product or business line? Are you rebranding or feeling the need to better distinguish your brand from your competitors?
If that 10% plus number seems out of reach, think about what other expenses you could decrease to bolster your marketing budget – remembering that you will measure your return on investment from each strategy and tactic, adjusting these as needed to ensure the expected increase in sales.
Before you get the creative minds involved, review your brand character, company values, and other factors that make your company appealing to your customers. Set ground rules to ensure that your marketing strategy and tactics are enhancing your brand. (Review last month’s article for examples.)
The key to devising effective marketing strategies is to remember that marketing is much more than advertising. It includes loyalty programs, free samples, all of the PR areas discussed last month, trade shows, etc.
Think about the characteristics of your target market segments (see Part 2 article) and how you can use what comes naturally to them to meet your objectives. For example, if one of your segments is active on social media, a deep discount flash sale or digital coupon that can be easily shared, might go a long way in attracting new customers. If you have a segment that wants the latest and greatest, regardless of price, a personalized exclusive offer could help you increase the average sales figure.
Since we’re going to delve into advertising in next month’s installment, make your focus for this month’s worksheet strategies that take advantage of what you know about your target market.
For more ideas on ways to follow up, have a look at our Marketing Strategy Worksheet.
Marketing Series Part 1 – What “Marketing” Means
Marketing Series Part 2 – Your Products, Services & Target Markets
Marketing Series Part 3 – Brand Management
Marketing Series Part 4 – Reputation Management
Marketing Series Part 5 – Customer Relations
Marketing Series Part 6 – Public Relations
Marketing Series Part 7 – Marketing Strategy
Marketing Series Part 8 – Advertising
Marketing Series Part 9 – The Components of Your Marketing Plan