Marketing Plans: Do I Really Need One?

What happens when you go to the grocery store without a list? You typically end up buying a bunch of stuff you don’t really need, spending more money than you planned, and come home to realize you forgot quite a few things. Then you have to go back again to get everything right. This is the same scenario you will face when you don’t sit down and write a marketing plan. It may seem like a waste of time, when all you want to do is jump in and get started, but actually sitting down and writing a marketing plan will save you time, money, and frustration in the long run. Here is what a marketing plan can do for your business:

Help you Focus on a Target Market

Without a marketing plan, it’s easy to get caught up marketing to everyone instead of a specific target audience. When you sit down and write a marketing plan, you think about who has a need for your product or service. You look at demographics such as age, gender, location, and education. When you narrow down your target market, you’ll be able to focus all your marketing dollars on an audience who actually has a need for your product or service, and stop wasting money marketing to an audience who has no interest.

Help you Spend Your Money More Efficiently

How do you know how much money you will allot to your marketing efforts, or determine if you are over or under-spending? Generally, around 10% of sales should be spent on marketing. Once you figure out this number and actually get it written in your plan, you will easily see how much you will be able to spend of each marketing strategy, and keep yourself from going over-budget.

Help You Focus on Specific Goals

Are you trying to get more sales? More leads? Increase brand awareness? Without a marketing plan, you don’t have a specific goal to work towards. All of your marketing efforts are going to help you work towards your goal, but if you don’t have a concrete goal written down ahead of time, you may find yourself getting off track in your marketing efforts.

Help You Monitor Your Competition

You know your business is going to have competition, but do you know how you compare to them? With a marketing plan, you take the time to find out exactly how you stack-up against the competition in terms of price, products offered, marketing strategies, etc. When you are able to see a side-by-side comparison, it will help you know what you need to do to gain the competitive edge.

Focus Your Marketing Strategies

Are you going to run a newspaper ad, or send out marketing emails, or focus on social media? There are tons of choices when it comes to marketing strategies, and you can’t do them all. If you have taken the time to define your goals and target audience in a marketing plan, you can decide what strategies will work best to achieve those goals.

Creating a marketing plan requires some effort on your part. You have to do quite a bit of research and planning ahead of time, and it is an ongoing process that will change as your business grows. But a well-written marketing plan is like a map, leading you the direction you want to go and preventing you from getting lost along the way. Take the time to write a detailed marketing plan now and your business will definitely reap the benefits down the road.

Retail Marketing Planning: How to Get Started With Marketing Planning

Marketers struggle with marketing campaign planning for different reasons: incomplete or inaccessible historical data, new marketing channels with no obvious comparables, lack of expertise or understanding of what really matters. We’ll explore how to address more of these issues in upcoming blog posts.

Understand Your Channels – Differentiate between Marketing and Order Channels

Even the most sophisticated marketers create confusion by using the word “channel” interchangeably between Marketing and Order Channels.

Marketing Channels are those that you spend your marketing efforts in: direct mail, email, display/retargeting, natural and paid search, affiliate, social media, etc. Order Channels are ones in which a customer places an order: call center, ecommerce/internet, and retail. Mobile is unique in that it can be categorized either way – for example, if a company has a mobile app which serves as a marketing tool, and a customer can also order through, the channel can be classified as either a Marketing or Order Channel. Keep in mind that the categorization should be consistent.

Plan Marketing Channels, then Forecast by Order Channel

Since you have much more control over marketing campaigns than where a customer will choose to place an order, start by planning your marketing campaigns. Each company has its own set of terminology, but there are typically three levels of marketing planning, depending on the complexity and depth of each channel. I’ll define my definitions for clarity:

Campaign – Overall theme that the marketing supports. This can be a season (Winter, Summer, Holiday), event (webinar, concert), membership drive (wine club, subscription-based purchase), promotion (semi-annual sale, clearance). Crosses between Marketing Channel and Communication since both are instrumental in supporting the campaign.

Marketing Channel – direct mail, email, search, display, affiliate, social media (same as above)

Communication – individual marketing treatments such as an email, postcard, Facebook ad, mobile ad, SEM ad.

For some marketing channels, such as direct mail, marketers typically plan at the Communication level. Direct mail requires more advance planning since print orders need to be placed, customer lists modeled and hygiened, list rentals ordered, and postage costs calculated.

Other marketing channels need less rigor and can be planned at the channel level. For example, if your affiliate program is fairly even and predictable, it probably makes sense to plan at the channel level rather than have individual plans for each publisher.

Depending on your business, you may also plan by Campaign. An example of this is a large semi-annual sale promotion – you would plan communications in each of your channels to support the promotion. You may send a catalog or direct mail piece, a series of emails, a social media contest, and targeted display ads to reinforce your message.

Increases in Circulation: Need to Account for Growth and Lower Performance

The next step is to take historic data as the plan starting point. Response rates, average order, click through rates, and other relevant metrics are helpful for planning for communications targeted at similar audiences.

Two common mistakes that marketers make are:

  1. Not adjusting for audience growth/shrinkage (if the same quality audience has grown, you can assume a similar response rate even though your circulation size has changed).
  2. Increasing/decreasing the audience of a different quality without accounting for a difference in performance. This is important – by increasing circulation, the quality of the audience will decrease and the expected revenue per person for the incremental circulation will be lower.

One way to determine the revenue increase/decrease per person for different quality circulation is based on a loose rule of thumb (divide the % increase by three so that the larger the increase in circulation, the greater the drop-off in revenue per person).

Using historical data and trend, you can then forecast your sales curves by order channel. Most large companies that have multiple order channels typically forecast by fiscal week for both call center staffing and managing the revenue/inventory predictions. Smaller and more internet-based companies may choose to forecast on a monthly basis.

Why Not Consider Viral Marketing to Help Your Marketing Communication Effort?

When asked about marketing communication, what normally comes to mind are the more obvious above the line stuff. This means commercials in the electronic media and ad messages we come across in billboards, buses and the like, as well as print ads in newspapers, magazines and so on.

And, of course, this could also be messages found on web pages. This can be banner ads, pay-per-click ads through different search engines, ads in web portals and so on.

And, of course, there are other means like brochures, catalogues and below the line stuff like PR articles. What about marketing communication received through viral means? What’s that you ask.

Let’s look at defining this: Viral marketing refers to a marketing strategy that motivates individuals to pass on a marketing communication to others, with the potential for exponential growth in the exposure and influence of the message. As this usually is internet-based, it is similar to the spread of computer viruses, or viral illness in real life. These tend to multiply rapidly and reach thousands, if not millions of people.

The classic example of how viral marketing works is how Hotmail spread and got a hold in the marketplace, being widely spread over the internet.

How did the strategy proceed. Yahoo, who owned Hotmail, gave away free e-mail addresses and services, by attaching a simple tag at the bottom of every free message sent out: offering those receiving the message a change to get their private, free email at hotmail.com.

Hence, each person in receipt of an email, passed the message on and this asked him/her to sign up for their own free e-mail service, and then with each passing of the message the communication spreads out further and further, being received by more people, with each turn.

In Australia, an example of the spread of a message virally, I remember the “Big Ad” commercial for Carlton Draught. It was a very unusual commercial, which was first viewed over the internet by many individuals. Originally passed on via email, this commercial landed in many a computer -long before it was aired on TV.

Hotmail was a free email account, which was “cool” and became a must have. Hence, this proved a good enough motivation for this service to be passed around. And, of course, with the offer embedded with emails that used the service, it was a tagged-on message that could easily be passed on.

With the second example, the unusual nature of the ad and it’s big-ness made for enough motivation for those receiving the clip to pass on to friends. And, with each pass, the circle became wider and got more people involved.

So, we see that the basic strategy is to use other people to pass on your marketing message. And, to do that they need a motivation. The first example used the motivation of a free service. It also helped the unstated must-have nature of the service also came into force.

And, with the Carlton Draught example, it was the unusualness, the being the first to see the ad before this was aired proved a good enough motivation to pass this on.

How can you get viral marketing working for you? There are several things you have to consider. First of all, what is the message you want to pass virally? You will need to figure this out first. Then work out the means to pass this on.

A means I think is a good means for viral marketing, is a blog. How do you push this virally?

First of all you will need good content, that is worth reading and passing on to others. Offering freebies on your blog is another possible means. The latter is especially good for viral means of spreading because who can pass up a good thing-especially if this is free.

There are many more considerations and other points that you must take into account, when planning a viral marketing exercise. What’ve given here are some basic considerations to get your viral message going.