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Creating a PowerfulMarketing Plan

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Building a Guerrilla Marketing Plan

Marketing

The process of creating and delivering desiredgoods and services to customers.

Involves all of the activities associated with

winning and retaining loyal customers.

Guerrilla marketing strategies

original, low-cost creative marketing techniques

that allow a small company to wring more bangfrom its marketing bucks.

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A Guerrilla Marketing Plan

1. Pinpoints the specific target markets thecompany will serve.

2. Determines customer needs and wants throughmarket research.

3. Analyzes a firm's competitive advantages andbuilds a marketing strategy around them.

4. Creates a marketing mix that meets customer

needs and wants.

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Pinpointing the Target Market

First step in building a guerrilla marketing planis to pinpoint the company's target market The specific group of customers at whom the

company aims its products or services.

The more a business learns about its local markets, itscustomers and their buyers habit and preferences, themore it can focus its marketing effort.

Without a clear image of its target market, a

small company tries to reach almost everyoneand ends up appealing to almost no one! Learn how to reach the target market and offer

goods and services designed specifically for them

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Determines Customer Needs And WantsThrough Market Research

Market research is the vehicle for gathering theinformation that serves as the foundation for themarketing plan.

It involves systematically collecting, analyzing andinterpreting data about companys market, customers

and competitors.

The objective of marketing research is to learn how toimprove the level of satisfaction for existing customers

and to find ways to attract new customers.

Market research does nothave to be timeconsuming, complex, or expensive to be useful.

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How to Conduct Market Research: Define the problem. List all possible factor that could have caused it.

Collect the data. Individualized (one-to-one) marketing

A system based on gathering data on individual customers anddeveloping a marketing program designed to appeal specifically totheir needs tastes and performance

Customer survey Focus group Daily transaction Other idea (suggestion system)

Data mining A process in which computer software that uses statistical analysis,

database technology and artificial intelligence finds hidden patterns,trends and connections in data so that business owners can makebetter marketing decisions and prediction about customers behavior.

Analyze the data and interpret the results.

Draw conclusions and act.

Determines Customer Needs And WantsThrough Market Research

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Plotting a Guerrilla Marketing Strategy:Relationship Marketing

Customer Relationship Management Involves developing and maintaining long-term

relationshipswith customers so that they willkeep coming back to make repeat purchases.

Small companies have an advantage over theirlarger rivals at relationship marketing.

Requires a company to make customer service

an inclusive part of its culture.

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Steps in CRM

Collect meaningful information on existingcustomers and compile it in a database.

Mine the database to identify the companys bestand most profitable customers and their buying

habits. Use the information to establish lasting

relationships with these customers.

Attract more customers who fit the profile of the

companys best customers.

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Guerrilla Marketing Strategies

Find a niche and fill it.

Niche strategy allows a small company to maximize theadvantage of its size

Dont just sell; entertain. Entertailling- a marketing concept designed to draw

customers into a store by creating a kaleidoscope of

sights, sounds, smells and activities, all designed toentertain and of course sell.

Strive to be unique. To create an image of uniqueness.

Create an identity for your business. Can use vision to market their companies and theirproduct and services

Connect with customers on an emotional level. Customer receives an emotional boost every time they

buy the product.

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Guerrilla Marketing Strategies

Focus on the customer. Develop a customer focus and inspire a customer

satisfaction attitude throughout the company.

Devotion to quality. World-class companies treat quality as a strategic

objective, an integral part of the company culture. This is the philosophy of Total Quality Management (TQM).

Quality in the product or service itself. Quality in every aspect of the business and its relationship with the

customer.

Continuous improvement in quality

Attention to convenience. Customers increasingly are looking for convenience

Location, timing, service, extra offer, well trained employees,efficiency

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Guerrilla Marketing Strategies

Concentration on innovation. Entrepreneurs often create new products and services by focusing

their efforts on one area and by using their size and flexibility to theiradvantage.

Dedication to service and customer satisfaction. Listen to customers.

Define superior service.

Set standards and measure performance.

Examine your companys service cycle.

Hire the right employees.

Train employees to deliver superior service.

Empower employees to offer superior service.

Use technology to provide improved service.

Reward superior service.

Get top managers support.

View customer service as an investment, not an expense

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Guerrilla Marketing Strategies

Emphasis on speed.

Use principles of time compression management(TCM):

Speed new products to market.

Shorten customer response time in manufacturing anddelivery.

Reduce the administrative time required to fill anorder.

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Benefits of Marketing on theWorld Wide Web

Even the smallest companies canmarket their products and servicesaround the globe.

67% of small businesses thatestablished Web sites said theirsites brought in new customers.

The Web can be the Great

Equalizer in a small companys

marketing program.

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The Marketing Mix

Product

Place

Price Promotion

$

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Stages in the Product Life Cycle

Introductory stage

Slow sales growth, highest promotional expense, highestproduct prices and negligible profit. Strategy

Rapid Skimming Strategy- high price, high promotional expense Slow Skimming Strategy- high price, low promotional expense

Rapid Penetration Strategy low price, high promotional strategy Slow Penetration Strategy- low price, low promotional strategy

Growth and acceptance stage Strategy

Improve product quality and add new product features and

improved styling Add new models Enters new market segment Increase distribution coverage and enters new distribution channel Shift to product conviction promotion

Lower price to attract new price sensitive buyers

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Stages in the Product Life Cycle

Maturity and competition stage

Increase in sales at decreasing rate Strategy

Market modification Sales can be increased by increasing thebrand users or by increasing the usage rate per user or both

Product modification quality improvement, feature improvement,

style improvement Market mix modification change any component of marketing mix

Product decline stage Lower sales due to availability of new substitutes and

changes in the consumer tastes and preferences. Strategy

Reducing the number of items produced and promotional expense.

Discarding the product

Repositioning the product

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Stages in the Product Life Cycle

Increase sales

at decreasing

rate

Sales &

Profits

Fall

Lunching

of the

product

Rapid Increase

in Sales and

Maximum

Profitability

Introduction Growth Maturity Decline

Total market sales

Total market profit

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Channels of Distribution Consumer Goods

Manufacturer

Manufacturer

Consumer

Retailer Consumer

Manufacturer Retailer ConsumerWholesaler Wholesaler

Manufacturer Retailer ConsumerWholesaler

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Channels of Distribution Industrial Goods

ManufacturerIndustrial User

Manufacturer Wholesaler Industrial User

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Developing a Marketing Communications Plan

Step 1: Create specific, measurable objectives.

Step 2: Identify and analyze the target audience.

Step 3: Design an advertising message and

choose the media for transmitting it.

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Promotion Includes

Publicity any commercial news covered by the mediathat boosts sales but for which the smallbusiness does not pay.

Personal selling the personal contact between sales personnel

and potential customers resulting from salesefforts.

Advertising any sales presentation that is non-personal in

nature and is paid for by an identified sponsor.

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Build Ads Around a Unique Selling Proposition(USP)

USP - A key customer benefit of a product orservice that answers the critical question thateverycustomer asks: What's in it for me?

Identify your product or service's USP by describingthe primary benefit it offers customers and then listother secondary benefits it provides.

Dont overlook the intangible or psychological

benefits your product or service offers. Briefly list a few facts that support this USP.

Then, focus your ads to stress these top benefitsand the facts supporting them!

Five Fundamentals of a Successful Advertisement

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Five Fundamentals of a Successful Advertisement.

It should attract attention.It should emphasize a keybenefit of the product or

service to the customer.

It should communicatethe companys UniqueSelling Proposition (USP).

It should prove the USPand benefits to the customerwith facts, statistics, ortestimonials.

It should motivate customersto take action immediately.

Source: Adapted from Jerry Fisher, Fine Print, Entrepreneur, November 1994, pp. 145-

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S f l P l S lli R i

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Successful Personal Selling Requires aSelling System

Create trust and respect - Establish rapport withprospect.

Interview the prospect - Let the prospect talk todetermine the key criteria that influence the buying

decision. Demonstrate, explain, and show Make clear thebenefits of your product or service.

Validate - Prove the claims about your product or

service. Overcome objections- Listen for objections and try to

overcome them.

Close - Stop talking and ask for the order.

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Advertising Media Options

Outdoor ads

Transit advertising

Directories Trade shows

Specialty advertising

Point-of-purchaseads

Word-of-Mouth

Newspapers

Radio Television

Magazines

Direct mail

World Wide Web

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Newspapers

Advantages

Selected geographiccoverage

Flexibility

Timeliness

Communication potential

Low cost Prompt responses

Disadvantages

Wasted readership

Reproductionlimitations

Lack of prominence

Declining readership

Short ad life

R di

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Radio

Advantages Universal infiltration

Market segmentation

Flexibility and timeliness Friendliness

Disadvantages

Poor listening Need for repetition

Limited message

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Television

Advantages

Broad coverage

Visual advantage Flexibility

Design and productionassistance

Disadvantages

Brief exposure

Clutter Zapping

Fragmented audience

Costs

M i

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Magazines

Advantages Long life spans

Multiple readership

Target marketingAd quality

Disadvantages

Cost Long closing times

Lack of prominence

Di t M il

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Direct Mail

Advantages

Selectivity

Flexibility

Reader attention

Rapid feedback

Measurable results

and testablestrategies

Effectiveness

Disadvantages

Inaccurate mailinglists

Clutter

High relative costs

High throwaway rate

Ad ti i th W b

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Advertising on the Web

Banner ads

Pop-up ads

Cookies

Full-page ads

Push technology ads

E-mail ads

Permission e-mail Spam

O

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Outdoor Advertising

Advantages High exposure

Broad reach

Flexibility Cost efficiency

Disadvantages Brief exposure

Limited ad recall Legal restrictions

Lack of prominence

T i Ad i i

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Transit Advertising

Advantages Wide coverage

Repeat exposure

Low cost Flexibility

Disadvantages

Generality Limited appeal

Brief message

Di t i

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Directories

Advantages

Prime prospects

Long life

Disadvantages

Lack of flexibility

Ad clutter

Obsolescence

T d Sh

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Trade Shows

Advantages

Natural market

Pre-selected audience

New customer market

Cost advantage

Disadvantages

Increasing costs

Wasted effort

S i lt Ad ti i

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Specialty Advertising

Advantages

Reaching selected audiences

Personalized nature

Versatility

Disadvantages

Potential for waste

Costs

Preparing An Ad ertising B dget

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Preparing An Advertising Budget

What is affordable

Matching competitor's advertising expenditures

Percentage of Sales

Past Sales

Forecasted Sales

Objective-and-Task

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2 3 . 5 %

19.3% 19.1%

7 . 7 %

5 . 9 %4 . 8 %

1.9% 2 . 2 %2 . 5 %

13.0%

0%

5%

10%

15%

20%

25%

P

ercent

Telev

ision

Direct

Mail

News

pape

rsRa

dio

Directories

Maga

zines

Pape

rs

Outd

oor

Inte

rnet Other

Medium

Advertising Expenditures by Medium

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How To Advertise Big On A Small Budget

Take advantage of cooperative advertising. Consider shared advertising.

Repeat ads that have been successful.

Use identical ads in different media. Hire independent copywriters and artists.

Concentrate advertising when customers are

most likely to buy.

Maximize publicity with techniques such ascause marketing.

The Factors That Must Be Considered When

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The Factors That Must Be Considered WhenDetermining Price

The factors that small business owners mustconsider when determining price for goods andservices includes: Product/service costs Market factors - supply and demand

Sales volume Competitors' prices The company's competitive advantage Economic conditions Business location Seasonal fluctuations Psychological factors Credit terms and purchase discounts Customers' price sensitivity

Desired image

What determines price?

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What determines price?

Price Ceiling ("What will the market bear?")

Price Floor ("What are the company's costs?")

AcceptablePriceRange

?

?

?

?

?

??

?

?

?

?

Final Price (What is the

company's desired "image?")

?

Pricing Strateg

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Pricing Strategy

Introducing new product

Goals: Getting the product accepted

Maintaining market share as competition grows

Earning a profit

Strategy Penetration

set prices below competitors to gain market entry

Skimming

set higher prices for new products and for markets with littleor no competition.

Sliding-down-the-demand-curve

set higher prices initially and slide down as technologyimproves and/or one step ahead of competitors

Pricing Techniques

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Pricing Techniques

Odd pricing

12.95 appears to be cheaper than 13.00

Price lining Several different price range. Ex- DVD price

Leader pricing

Marks down the customary price

Geographical pricing

Zone Pricing - Different price for customers located in different territoriesbecause of different transportation cost.

Delivered Pricing same price regardless of location

FOB pricing sells on the condition that customers will pay all theshippingcost

Opportunistic pricing

Charging high when goods and services are short in supply

Discounts

Multiple unit pricing discounts if purchased in quantity.

Suggested retail prices

P i i f R t il M k

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Pricing for Retailers: Markup

Dollar Markup = Retail Price - Cost of Merchandise

Percentage (of Retail Price) Markup =Dollar MarkupRetail Price

Percentage (of Cost) Markup = Dollar Markup

Cost of UnitExample:

Dollar Markup = $25 - $15 = $10

Percentage (of Retail Price) Markup =$10

$25= 40%

Percentage (of Cost) Markup =$10

$15= 67%

Pricing for Manufacturers Breakeven Selling Price

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Pricing for Manufacturers: Breakeven Selling Price

BreakevenSelling

Price

Quantity

Example:

=Profit

Variable costper unit produced

TotalfixedcostsX

{{ x

}}+

Quantity produced

Breakeven

Selling

Price

=$0 6.98/unit 50,000 /unit $110,000X { x }+

50,000 units= $9.18 per unit

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Pricing for Service Firms: Price per hour

Price per Hour = Total cost per x 1.00productive hour (1 - net profit target

as % of sales)

Example: Neds TV Repair Shop

Price per Hour = $13.44 per x 1

hour (1 -.18)= $16.38 per hour