What is Marketing Planning? Definition, Elements, Importance

What is Marketing Planning?

A marketing plan is a written document that summarizes what the marketer has learned about the market place and indicates how the firm plans to reach its marketing objectives. It is one of the most important outputs of the marketing process.

Marketing plan and product planning is becoming more customer and competitor-oriented and is becoming a continuous process to respond to rapidly occurring and changing market conditions.

Marketing Planning Definition

Philip Kotler define it as “Marketing plans are developed for individual products, lines, brands, channels, or customer groups. The marketing plan is one of the most important outputs of the marketing process”.

According to Winchester “An effective marketing plan defines how and why the company is in business, what markets are good targets for its products, and how customers should be pursued. With a marketing plan in place, a company uses the plan to measure how effectively corporate goals have been met”.

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Elements of Marketing Plan

The marketing plan is often a complex and diverse document that examines many areas. For most plans the key elements of marketing plan found in the document include:

1. Organizational Mission
2. Executive Summary and Table of Contents
3. Situation Analysis
4. Marketing Strategy
5. Marketing Strategy
6. Financial Projections
7. Implementation Control

Organizational Mission

Represents the guiding force of an organization by identifying the long-run vision for what the organization hopes to achieve. The mission comes from the top leaders of the organization and often remains unchanged for many years.

Executive Summary and Table of Contents

The marketing plan should open with a brief summary of the main goals and recommendations. A table of contents outlines the rest of the plan and all the supporting and operational details.

Situation Analysis

This section presents relevant background data on sales, costs, the market, competitors and various forces in the macroenvironment. All this information is used to carry out SWOT analysis.

Marketing Strategy

Achieving objectives requires the marketer to engage in marketing decision-making which indicates where resources (e.g., marketing funds) will be directed. However, before spending begins on individual marketing decisions (e.g., where to advertise) the marketer needs to establish a general plan of action that summarizes what will be done to reach the stated objectives.

Marketing Strategy

Here, the product manager defines the mission and marketing and financial objectives. The manager also defines those manager then establishes the product lines competitive positioning which will inform the game plan to accomplish the plan’s objectives.

Financial Projections

Financial projections include a sales forecast, an expense forecast and a break-even analysis on the revenue side, the projections show the forecasted sales volume by month and product category. On the expense side, the projections show the expected costs of marketing.

Implementation Control

This section outlines the controls for monitoring and adjusting implementation of the plan. Typically the goals and budgets are spelled out for each month or quarter so management can review each period’s result and take corrective actions as needed.

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Characteristics of Marketing Plan

Following are the characteristics of market plan:

• A good marketing plan should communicate to every member what is desired of each member so that they have some level of goal clarity, understanding of assumptions that lie behind the goals and the context of each activity and decision.
  
  
• Since in most of the organizations planning is a mutually agreed-upon activity, a good marketing plan should also stimulate individual and group commitment.
  
  
• An effective marketing plan provides you with objective information to confidently make decisions. This includes research that identifies the consumer need for your product or service, customer demographic characteristics, the competition from which they are buying, the places they are buying and the prices they are willing to pay.
  
  
• Different organizations follow different kinds of planning approaches. Organizations where top management sets both the goals and plans for the lower management follows a top-down approach.
  
  
• In democratic and participative organizations, there is a bottom-up approach in which each unit in the organization creates its own goals and plans, which are then approved by the top management.
  
  
• The third approach is to have goals down-plans up approach. In this approach the top management sets the goal but various business units create their own plans to meet these goals.
  
  
• A good marketing plan would include a section on identifying, comparing and recommending distribution strategies.

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Importance of Marketing Plan

We can summarize the importance of marketing planning in the following manner:

• It helps in avoiding future uncertainties.
• It helps in management by objectives.
• It helps in achieving objectives.
• It helps in coordination and communication among the departments.
• It helps in control.
• It helps the customers in getting complete satisfaction.

Example: Here is an example of how HUL benefited by doing effective marketing planning:

• HUL has gone into strategic partnerships with technology companies for such targeted market development. In this direction the company’s sales persons will be expected to carry hand-held devices in which all details of kirana stores will be there of the areas they operate in.
  
  
• HUL has also launched initiatives like ‘go to market’ and ‘Bushfire’ so that the company can ensure reaching its products to seven million outlets instead of selling the product in just 2,000 modern trade stores.

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Process of Marketing Plan

Careful planning increases the chances of successfully accomplishing what you set out to achieve. The principles of good planning can be applied to almost any project and remain the same irrespective of the task.However, the outcome of planning, the plan, can differ according to the nature and purpose of the task.

There are three stages in the process of preparing a marketing plan.

1. Reviewing your Overall Strategy
2. Determine the Impact of your Targeting and Positioning Decisions
3. Review these Needs and Prepare an Action Plan

Reviewing your Overall Strategy

The first involves reviewing your overall strategy to confirm the definition of your target customer and decide on the positioning strategy you want to adopt. Positioning is generally concerned with how you differentiate your products and services from those of your competitors.

Determine the Impact of your Targeting and Positioning Decisions

The next step is to determine the impact of your targeting and positioning decisions on your strategy for the marketing mix. The marketing mix deals with such issues as product specification and development, pricing policies, delivery systems (place) and promotional activity, and is sometimes referred to as ‘the 4Ps’.

By this point you will be making decisions that indicate the need for specific action to be taken which, in turn, have implications for the operational resources you will need.

Review these Needs and Prepare an Action Plan

The last step is to review these needs and prepare an action plan that states, using ‘action-oriented’ statements, what will be done and when preferably with allocated responsibilities for each task.

When you have formulated your marketing plan it can be helpful to produce a written document. Actually writing out the plan and including justification for intentions will help crystallize your thinking and ensure that you have covered all the important points.

If you will be seeking external finance to support your marketing development, any potential patron will insist on a written plan possibly as part of an overall business plan.

The core elements of a marketing plan are:

• Description of the products and/or services you intend to sell—what they do, how they work, the customer benefits they offer and how they differ from those of the competition.
  
  It may be helpful to incorporate here or possibly as a separate section, a description and analysis of your chosen market including market size, market structure, competitors and market trends.
  
  
• Definition of your target customers, including an explanation of why you believe they will buy your products/services—the benefits they seek and the reason why they are likely to choose your products in preference to those of your competitors.
  
  
• A section dealing with each element of the marketing mix stating what you will do and why.
  
  
• An assessment of the resource implications of your plan—additional people, equipment, etc.—noting why you need them and the costs involved.
  
  
• Summary action plan time-table.

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Reference

• V. S. Ramaswamy, S. Namakumari; 2009; Marketing Management; MacMillan Publishers Pvt Ltd.
• Kotler, Keller, Koshy, Jha; 2009; 13th Edition; Marketing Management: A South Asian Perspective.

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