Market Planning Tools - Creating A Winning Marketing Plan

WRITING THE WINNING MARKETING PLAN

''Many people believe that the basic issue in marketing is…
convincing customers you have a better product, that in the long run
the best product will win.

Not true… It's an illusion…there is no objective reality. The perception is the reality

Marketing is a battle of perceptions not products. All that exists in the world of marketing are perceptions in the mind of customers''

Source: the 22 immutable laws of marketing by Jack Trout, Al Ries

Contents
1	Background
1.1	Highlights of feedback from you
2	The Marketing Planning process
2.1	Objectives and expectations
2.2	The planning cycle
2.3	How all the plans fit together
3	Writing and presenting Marketing Plans
3.1	Tools to help you
3.1.1	Overview of available tools
3.1.2	The user manual
3.1.3	The plan structures
3.1.4	The toolbox
3.1.5	The presentation pack
4	Facilitating the Marketing Planning Process
4.1	Meeting 1 - Planning Initiation
4.2	Situation Analysis
4.3	Meeting 2 - Agree Analysis
4.4	Prepare for strategy development
4.5	Meeting 3 - Select strategy
4.6	Finalise strategy section
4.7	Meeting 4 - Action Planning
4.8	Plan Consolidation and Integration
4.9	Graphical summary of the Marketing Planning
5	Segmentation and Branding Methodologies
5.1	Customer Segmentation Methodology
5.1.1	The customer segmentation process (Figure 5.1 (a) steps 1-6)
5.1.2	The targeting (of segments) and positioning (within segments) process (Figure 5.1 (b) steps 7-11)
5.2	Branding Methodology
5.2.1	The branding process (See figure 5.2 steps 1-8)
6	If you have questions
6.1.1	Frequently asked questions and answers
6.1.2	Useful contacts
7	Glossary of Terms and Issues Worksheet
7.1	Glossary of Marketing Planning Terms:
7.2	Issues Worksheet

Background

As part of our work with one of our larger customers, we introduced a revised common Marketing Planning process and single common format early this year.

Why is Marketing Planning important?

Marketing Planning is concerned with managing your business responsibilities in the future, to make best use of two limited resources time and money, in order to generate the planned profits by satisfying the needs of your customers.

"Marketing Planning is a means of ensuring an orderly and profitable transition from today in to the future. If, as a manager, you enjoy letting things happen, if things are good as they are, or if you like panic decisions, then Marketing Planning has no value. However, if you want to understand and control your growth, improve your profits or increase the chances of your company's survival, then Marketing Planning is not an option, its mandatory. Planning is not something apart from the rest of the business. To be successful, it must determine activities and be recognised for what it is by the whole company."

The discipline of Marketing Planning also requires your to continually re-investigate your perceptions of your customers and your market environment or 'playing field' to develop and test alternative options for your business. It allows you to be more prepared for the unexpected, the essence of which, was effectively summed up by Pasteur:

"Chance favours the prepared mind"

Pasteur

The Marketing Planning process

Objectives and expectations

The Marketing Plan serves several purposes:

The Marketing Plan will therefore have many readers.

The Company Marketing Plan will be read by all of the internal managers and by the Company's directors in order to help them understand the global strategy and direction. The senior management team will all participate in the Company Marketing Plan to ensure that the Company's business objectives can be achieved through the investment in Marketing.

Most importantly, the Marketing Plan is to become an effective and living management tool for you.

To ensure that your next Marketing Plan fulfils your expectations, you should:

clearly identify opportunities and sources of competitive advantage through more intimate and shared market understanding;
clearly state prioritized and focused objectives, tactics & strategies to achieve corporate expectations, consistently aligned across the marketing & sales organisation; and
efficiently plan resources, based on focused and detailed action plans.

The planning cycle

The Marketing Planning cycle 2001 follows an annual process. The schedule of events are outlined in the table below:

Marketing Planning Cycle 2001 Schedule of Events
Planning Activity	Month


Kick-off planning cycle
Extended team planning meetings (strategy presented)
Sales and Marketing presentation of joint plans
Marketing Plan completed
Submission to Board
Business Plan completed
Submission to Board
Board Approvals
Management roll-out meeting
Quarterly review of progress against plans

How all the plans fit together

Marketing management will present a global analysis of the market situation, from which it will identify the key issues critical to the company's success on a worldwide basis. These key issues will then drive the Company's objectives and its global strategies, which the Company will want to see deployed consistently throughout its local markets.

Not only is the alignment of the Marketing Plan of critical importance, but also the relationship of the Marketing Plan with the plans of the other functional areas of the business (e.g. Sales, HR, Finance, Operations & Engineering.); to ensure co-ordination and integration of cross functional activities at a local level. For example, the Marketing Plan should define customer segmentation that can be used and developed by the sales team in the preparation of their sales and key account plans.

Writing and presenting Marketing Plans

Tools to help you

Overview of available tools

1.1.1 The user manual

The purpose of the user manual is to provide you all the relevant information to get you started with your Marketing Plan.

It explains:

the objectives of the planning process
the timing of the planning cycle and the key milestones
the key processes of customer segmentation and branding
explanations on how to use the different tools provided
how to facilitate the Marketing Planning process (i.e. how to plan the plan), including guidelines on key steps and roles and responsibilities.
a Glossary, introduced to help build a common understanding of the most relevant marketing terms, used throughout the Marketing Plan structure.

1.1.2 The plan structures

The Marketing Plans follow a logical structure, made up of 9 chapters outlined below:

Facilitating the Marketing Planning Process

The objective here is to describe a possible planning process or 'how to plan the plan'. It is presented as guidance only, and it is expected that each planning team will adapt it as necessary to best fit their own requirements. The process involves four key group activities:

Planning Initiation
Analysis agreement
Strategy selection
Action Planning

The VP of Marketing ideally should form a Marketing Planning team with representation or input from sales, finance, product management, Engineering and HR. In this way, maximum leverage is made of local expertise and the link to sales planning is ensured. Between each group activity team members work individually to develop plan materials and write the individual plan sections.

Meeting 1 - Planning Initiation

The initial team meeting is required to establish roles, responsibilities, time scales and planning approach to be taken. This should cover not only the overall activity but in particular the details of rewriting or updating the situation analysis section of the plan. The following objectives are suggested for this first meeting.

Objectives

Agree on the team
Agree on the overall timetable
Agree on the team meeting schedule
Agree on the work split for the situation analysis section

Process. It is suggested that the VP Marketing prepares suggestions for the first three objectives before the meeting and may choose to circulate these to proposed team members before the meeting. In any case these items should be agreed on rapidly so that the main part of the meeting can be focused on the situation analysis. The team next reviews what resource materials they have available including:

Previous company strategy, situational analysis and marketing plan
Available sources of market data
Marketing Plan structures, Excel tool sheets and the tables and methodologies toolbox.

Then the team can decide what can be achieved and which approach should be taken. In particular the team should consider which of the planning templates from the toolbox should be used. Having decided on the approach, the work of filling in the templates, graphs and developing the plan text should be allocated between the team members. A team member should also be appointed to consolidate and integrate the various outputs.

A possible strategy is for team members to develop the templates and key bullet points, and for a single team member to write the overall section. Once this is agreed the team can disperse and work individually.

Situation Analysis

The situation analysis itself is best done by team members working on their own but in communication with others using e-mail. There are four key activities during this phase of planning:

Data Gathering - locating data sources and updating the situation
Individual Analysis - extracting the key "so what" bullet point from the data
Consolidation - bringing together the contributions and integrating into a single "story"
Individual Review - team members critically reviewing the integrated output

If these are completed successfully, then the team is well prepared for the next group session. During the situation analysis, issues could be compiled on an 'Issues Worksheet' included in Section 7.2 to help compile issues on an on-going basis.

Meeting 2 - Agree Analysis

The purpose of meeting two is to ensure that the quality of the data analysis and key issues identification is high, by using the team to provide both challenge to and building on individual ideas.

Objectives

Agree Analysis
Generate SWOT
Agree Key Issues

Process. The VP of Marketing should first test for a team consensus on the materials and give opportunities for the team members to explain to the group what choices they made and why. Allowing some constructive changes on the material is normally important at this stage. Once the basic analysis is agreed, the team should work on producing a SWOT again ensuring that there is a real consensus on the output. Once the SWOT has been completed, the team should identify a small number of key issues for the upcoming year. The final activity of this session needs to be to agree on the pre-work that each team member should do, based on the issues and SWOT, before the next team meeting

Prepare for strategy development

Before the group strategy making activity each team member should do some individual preparation, the amount and content will depend upon the outcome of the analysis/SWOT meeting, but the following are general issues that should usually be considered.

Have the issues changes since last year? - how? - why? - is this what I expected?
Did our strategy work last year? - to what extent? -what can we learn?
Has the Company strategy changed from last year? -how? -why? -what does this mean for me?

Taking this preparation activity seriously is important as it enables a much more productive strategy selection meeting, but it is often practically difficult to find the time and many people tend to overestimate their capacity for contributing without preparation.

Meeting 3 - Select strategy

Meeting 3 is required to ensure that the goals/objectives answer the key issues and that the strategy is developed to meet the goals/objectives. The purpose of the team meeting is to provide some "out of the box" thinking and challenge to the current strategy and to get agreement to the broad way forward. Detailed development of the strategy section is best done after the team meeting.

Objectives

Agree Goals/Objectives
Agree strategy in outline
Agree work to develop strategy materials
Agree approach to finalising strategy section

Process. The team leader should ensure that the meeting starts with a re-statement of the key issues and that these remain visible/accessible to the team throughout. Goals/Objectives need to be developed to answer the key issues and meet corporate requirements. This can be done with a simple four stage process:

Analyze and state corporate constraints - what does the strategy and budget require?
Re-state key issues
Set goals/objectives
Review goals/objectives - check that they meet corporate and market requirements

Brainstorming strategy options is a good approach as it helps people to think outside the current strategy. Comparison with the existing approach helps to generate further issues. Options can then be considered in terms of:

Feasibility - can we afford it? Do we have the right resources/skills?
Suitability - will it meet our objectives? At what level of risk? Is it effective and efficient. -does it need to be?
Acceptability - will key corporate or market place stakeholders object or obstruct? Why?
Robustness - If market or corporate conditions change can the strategy be adapted? How sensitive is success to planning assumptions?

Final strategy selection can be made by eliminating extreme options and ranking the remainder. Once a strategy has been agreed by the team, work can be allocated to team members to develop the ideas and write the strategy section of the plan.

Finalize strategy section

Developing the details of the strategy section is probably best done either by all team members working individually or by using a nominated team member as a writer and the rest as reviewers. Whichever way it is done, the section will need to be consolidated and reviewed before action planning is started.

Meeting 4 - Action Planning

Meeting four is required to ensure that the actions and tactics are co-ordinated across the area and that the linkage to sales planning is explicit and effective. A key requirement is to check that the planned actions fit within the strategy and meet the goals/objectives.

Objectives

Translate strategy into actions
Agree linkage to sales planning
Check that the plan goals/objectives will be met
Agree plan finalization

Process. In translating the strategy into actions, resource constraints are the key. For this reason, the team need to identify early any "exceptional" or one off activities that will need to be accommodated within the plan. Marketing Planning product launch is the most common of these events. The planning process could then be approached as follows.

Plan for product launch activities and other "one off" events
Plan for in-market product marketing activities
Develop linkage to sales planning
Review and agree responsibilities for plan elements
Review and agree in outline resource requirements
Check that plan elements meet goals/objectives

If agreement can be achieved on all the major points, detailed planning and refining resource requirements is best achieved by working on an individual basis and consolidating and integrating the results.

Plan Consolidation and Integration

Integrating and consolidating the final plan is probably best achieved by one or two team members working on the total document to ensure consistency. However before finalization the plan should be reviewed by all team members. A final meeting may be required, or the process of review and issue can be conducted by e-mail. Once the plan is reviewed and agreed it can then be issued.

Graphical summary of the Marketing Planning

The following charts summarize the main steps in the process of preparing and writing Marketing Plans. It also gives indicative estimates of how much time you should spend at each stage.

Segmentation and Branding Methodologies

One of the key aims for any Marketing Plan is to better understand the needs of the customers. In support of that aim, two marketing methodologies, (1) Customer Segmentation and (2) Branding, are presented in this section of the user manual.

For both customer segmentation and branding, the company's strategies should provide guidance on the extent of a global implementation. Should this be worldwide or merely US, not in theory, but in practice and to what extent and over what timetable?

Guidance:

For customer segmentation, the planning team should first outline segmentation criteria for customers based on qualitative factors (e.g. group/segment customers based on their behavioural characteristics that help determine prescription patterns). Having done this, the planning team then needs to develop local segmentation criteria based on quantitative factors (e.g. unit sales by type of customer.). Finally, the planning team needs to apply to the selected qualitative segmentation factors a tactical approach that reflects customers' needs and provides an effective means of selecting and targeting the most attractive segments for the Company.
For branding, the planning team should define the brand values that meet the needs of customers in all markets meaning both US regions and other countries. The team then needs to deploy the corporate branding strategy where applicable and also adapt it where required, to meet the local needs of the market.
At this point, the segmentation and branding processes come together. This then allows the positioning of products within the targeted customer segments, to implement the brand locally and to develop a marketing mix that meets the needs of the customer segment.

Customer Segmentation Methodology

What is market segmentation?

The process of splitting customers, or potential customers, within a market into different groups, or segments, within which customers have the same or similar requirements.

Why segment?

A company that decides to operate in a broad market recognizes that it normally cannot serve all the customers in that market. The customers are too numerous, dispersed, and varied in their buying requirements. The company, instead of competing everywhere needs to identify the most attractive segments that it can serve effectively. Therefore segmentation has many benefits:

To assess the attractiveness of customers segments to help define focus
- Not every customer has the same potential
- Great opportunity to get more out of limited resources by focusing on high potential customers
To build the basis for development of segment-specific strategies to win the war one battle at a time

What are the key characteristics of a good segmentation?

The segmentation process is one of the first steps in approaching a market and a good segmentation scheme must be such that:

(a) the needs within one segment are similar
(b) the needs from segment to segment are significantly different
(c) the segments are measurable (definable), accessible and actionable
(d) the segments should make sense for the local market

How should we effectively segment our customers?

A common customer segmentation targeting and positioning process has been developed (see Figure 5.1(a) and (b)). This methodology has been developed as a tool to help you segment your customers. In this way, the process is designed to be as practical as possible, to provide a systematic way of approaching the segmentation of your market. The process has been split into two parts, Customer segmentation (described in section 5.1.1) and targeting and positioning (described in section 5.1.2).

The customer segmentation process (Figure 5.1 (a) steps 1-6)

Developing customer segmentation using quantitative factors (steps 1-2):

The first two steps of the segmentation methodology involve the gathering of quantitative information (unique to your market) to define the full potential of your market and to develop a way of segmenting the market, based on these quantitative factors.

Developing customer segmentation using qualitative factors (steps 3-4):

Steps 3 and 4 of the segmentation process consider (and select) additional ways of segmenting customers based on qualitative factors such as customer behavior, values or attitudes. As these qualitative factors may be common across all or many of your global markets, you should first look for guidance form your own company business strategy before you develop your segmentation. This part of the process should develop a framework or a 'segmentation map' based on qualitative factors that quantified customers can be plotted on to in step 5 of the process.

Plot key customers on to the segmentation map and validate segmentation (steps 5-6):

The next stage of the segmentation process is to complete and validate the chosen qualitative segmentation.

The targeting (of segments) and positioning (within segments) process (Figure 5.1 (b) steps 7-11)

Once segmentation is complete, the next consideration is which segment(s) to target and how to position your product offering into the target segment. Steps 8 to 10 of the process considers the positioning of the brand(s) by segment (and is the key link to the branding process outlined in figure 5 and described in section 5.2) as well as developing a marketing mix by segment.

Branding Methodology

What is effective Brand or 'Perceptual' Marketing?

Intimately knowing the values and needs of our customers… and then…

...ensuring that every element of our marketing mix is aligned behind creating, delivering and communicating the values which will trigger our customers to prescribe our brand over our competitors.

Why is Perceptual Marketing or Branding important?

"Products often struggle to demonstrate major differences in terms of their technical benefits … highlighting the need to obtain greater insight into user perceptions of brands, and factors motivating them to actually purchase and use"

"The company that fails to examine and monitor the equity of its brands in the consistently evolving technology markets, does so at its own peril".

"Marketing Managers who don't take account of the emotional factors in brand choice and prescribing miss the opportunity to maximize the value of their brands"

How do we become more customer focused?

Since effective Brand or 'Perceptual' Marketing is about intimately knowing the values and needs of our customers (customer focused)…

Product Focused	Customer Focused
Segment by products Scientific focus Relies on relationships; has difficulty disciplining sales force to provide useful reports & intelligence Talks about product performance, factory volume/sales achieved Knows competitive product features Checks Marketing Plan only when it's time for a new version.	Segment by customers Focus on customer perceptions Tracks market changes & modifies strategy based on market research & systematic collection of sales reports Talks about customer needs, share, uses & segments.Uses Marketing Plan to manage activities & invest effectively

What are the Key Elements to Brand Equity?

1. The physical element: perceived functionality

relative effectiveness of product is very important
how well product advantages (key data, science) are communicated so that our customers perceive that our products offer superior value than our competitors, is key

2. The emotional element: developing affinity to a brand

trust and innovation
brand identification via:

nostalgia, pleasant association of successful treatment bonding, sharing the users values or perspectives

What are the Challenges with Branding?

Consumers buy products but they choose brands. Consumers form relationships with brands, not products, and not corporations.

The performance of the product, what it does, and how it does it, is the core identity of the brand. But the brand also has a distinctive personality and character that makes an emotional and trust-based connection with the consumer and distinguishes it from competitive brands.

Source: Winning with P&G

How can we more effectively brand our product offering to meet customer needs?

A common branding process has been developed (see Figure 5.2) as a key methodology to assist your marketing teams to prepare your Marketing Plan. This process has been designed to be as practical as possible, to provide a systematic way of considering branding in your market. This process is primarily driven by the senior management planning team in order to develop a consistent world-wide brand image. The branding process is not limited to a particular section of the Marketing Plan, it has components that are located in the situation analysis (e.g. understanding customers perceptions and values), objectives and strategies (e.g. how are we going to close the perception gap?) and action plans.

The branding process (See figure 5.2 steps 1-8)

Brand Development (steps 1-4):

The starting point for the branding process is to understand the customer's current perceptions of brands, and the customer's values that cause them to prescribe a particular brand (e.g. market research to help map out customer's perceptions of brands).The next step is to identify any gap between current customer perception of our brand (step 1) and the key customer value driver (step 2). Indeed this gap can be visulized through the use of a perceptual map.. The final step of brand development is to define the key brand essence of our brand to match customers' key value drivers (step 4). What product attribute (or Core Value Component (CVC) can be turned into an advantage and match customer beliefs / needs?

Brand Deployment and Tracking (steps 5-8):

Steps 5-8 of the processes are deployed locally. The brands need to be positioned by customer segment and a marketing mix developed to support the positioning.

If you have questions

Frequently asked questions and answers

Q. Can I include tables and graphs that are not included in this outline?

A. We would encourage you to include new ideas if they help explain the issues in your market more clearly.

Q. Must I answer all the questions in the Word Marketing Plan structure?

A. The 'Questions to be answered by this section' are designed as guidance to help you cover the main issues. You should carefully consider each, however, if they are not relevant for your market or other issues are more critical, please use your judgement on which content is best covered.

Glossary of Terms and Issues Worksheet

Glossary of Marketing Planning Terms:

AVC (Augmented Value Components). The AVCs are the customised elements of value for the brand that are expected to tip the scales in favour of our brand versus the alternatives from the competitors. These are often developed locally.

Assumptions. The major market assumptions (e.g. estimated future market growth rates) on which the Marketing Plan is based.

Core Marketing Model. One of the tables, diagrams or graphs that is considered an essential component of the Marketing Plan.

Customer. An individual or organisation that can materially impact the process of delivering prescriptions.

Critical Success Factors (CSF). The relatively few factors that determine success.

CVC (Core Value Components). The CVCs are the intrinsic elements of value for the brand common to all regions and countries.

Implications. The potential result(s) arising from a particular action.

Issue. Opportunities for which the company is not competitive, and or/threats.

Key Issues. The few most critical market issues (typically 3-5 identified from the SWOT analysis) that need to be addressed and overcome for business success.

Market Segment. A group of actual or potential customers who can be expected to respond in approximately the same way to a given offer. A finer more detailed breakdown of a market.

Marketing Objectives. A statement of the targets or goals to be pursued and achieved within the period of the Marketing Plan. Where do we want to go/be.

Marketing Plans. The outcome of the Marketing Planning process. A good discipline in preparing 'internally consistent' Marketing Plans is to use the following format:

SWOT/Issues > Objectives > Strategy > Specific Actions or Tactics

Marketing Plan Skeleton. A formatted word document to assist Marketing Planning.

Marketing Actions Tactics/Programs. The actual concrete steps to be taken to achieve the marketing strategy.

Marketing Strategy. A description of the course of action to be taken to achieve a specific marketing objective. The strategy is often referred to as the connecting link between marketing objectives and marketing tactics.

Measure. Quantitative (not necessarily financial) measurement of the impact of the activity.

Opportunity. A feature of the market environment that is commercially attractive.

Product Positioning. The process of selecting, and matching the customer segment of the market with a product that will be most compatible (to meet the needs of those customers). One of the major objectives of product positioning analysis is to discover how well your product is perceived by customers to meet their needs in relation to the competition.

Segmentation. A finer more detailed breakdown of a market, by splitting customers or potential customers into different groups or segments, within which customers have the same or similar requirements.

Situation Analysis. Reviews the business environment (with particular attention to market, competitive and economic aspects) as well as the company's own internal operation.

Strength. Elements within the company's control that are considered stronger than those of its' competitors.

SWOT Analysis. The SWOT is a summary of the Strengths, Weaknesses (of the company), Opportunities and Threats (from the market environment) emanating out of the marketing audit.

Threat. A feature of the market environment which is unattractive because it could have a damaging impact. It could be either through reducing market potential or through closing the window of opportunity.

Qualitative Segmentation criteria. Criteria used to segment the market, which are not derived from quantified market statistics (e.g. customer behavior).

Quantitative Segmentation criteria. Criteria used to segment the market which are based on a definite amount or number (e.g. geographical market statistics such as patient numbers by region.)

Weaknesses. Elements within the company's control that are thought to be weaker than that of its competitor(s).

Issues Worksheet

Marketing Planning Key Issues Worksheet

Section	Proposed key issues arising from analysis for discussion	Identified by
Market Analysis
Definition of market dynamics
Environmental forces analysis
Customer analysis
Stakeholder analysis and customer pipeline and volume analysis
Customer analysis and segmentation
Competitive Situation and Product Information
Competitive analysis
Product Information
Others

In Conclusion:

What we have provided here is a framework for you to think about and hopefully to use. At the very least it provides you with the necessary questions that you need to answer if you expect to be able to use your Marketing Plan for something more than a document that you prepare once a year for the purpose of presenting to your board and investors. The real benefit of creating a Marketing Plan is be able to have a robust and actionable set of highly integrated plans that should be able to change the direction of your company over the long term and provide a roadmap for success in the short term.

We also don't expect that you should be able to use this document without questions or your own set of ideas, so make sure that you give us a call or email us.

Derby Management

Derby Management
399 Boylston Street, Boston, MA 02116
Tel: 617-292-7420