A home-based entrepreneur is faced with unique challenges to overcome.
Foremost of these is the negative stereotype that potential customers may
have on home-based businesses. Many people still look at home-based
businesses as part-time or temporary employment, makeshift operations run
from the garage, or worse, not "real" businesses.
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In order to overcome these misconceptions, you must have a
well-thought-out plan on how to present the business to customers and
generate the kind of sales that your business needs. You must develop a
solid marketing plan that will direct the way that you communicate your
business to target customers.
Your Marketing
Plan
According to Kim Gordon in her book "Growing Your Home-Based
Business: A Complete Guide to Proven Sales and Marketing Strategies," a
good marketing plan is "a blueprint for action that will perform a
number of highly critical functions." Writing your marketing plan can
help you identify the most cost-effective strategies you can use to present
your business to your target audience.
A written marketing plan can help you save money by avoiding unnecessary
or impulsive expenditures. Everyday, you will be presented with various
marketing communication opportunities. You may receive an offer in the mail
to create CD-ROM business cards, or a request to sponsor a local festival,
or a request for a radio interview. By planning ahead, it will be easier for
you to decide what works for your business, what fits your budget, and what
reaches your audience. Your marketing plan will keep activities and budgets
on track year-round.
Gordon also adds that the "lack of a comprehensive marketing plan
can lead to dramatic repercussions, not the least of which is a fall-off in
sales." You may not be tapping all possible means of reaching your
audience, resulting in lackluster sales. Having a marketing plan can also
help prevent important communications activities from falling by the wayside
during even the busiest times of the year.
Outline of a
Marketing Plan
Your written marketing plan need not be lengthy and complicated. You can
even make it as simple as possible. It is an internal document where you can
be honest and direct when describing your company's weaknesses.
Gordon suggests the following outline:
1. Situation
Analysis.
Your first step is to take a comprehensive look at your company's
challenges, its position in the market place, level and intensity of
competition, and other factors that may affect your marketing strategies.
This is the market research portion of your plan.
- Challenges. When you open your business, you are faced with the
huge task of letting your target market know that you exist, and willing
to serve their needs. You are faced with the challenge of communicating
with your target market to get them to become your customers.
- Position in the marketplace. Your promotional strategy should
highlight the "unique selling points" of your business.
- Competition. This involves a complete analysis of the
businesses already offering your type of goods and services within your
geographical area (e.g. county, town, and city). You want to learn how
many businesses are already in the marketplace, what they offer, and
where they are located. By looking at this data, you can identify the
relative strengths and weaknesses of your competitors in the area of
price, quality, selection, promotion, services, customer
service/personnel support, facilities/atmosphere, and location.
2. Target
Audience. One of the most
important segments of your market analysis involves identifying the people
or businesses that may have a desire to purchase your type of product or
service. The key is to know who buys what, how often, from whom, and what
they may be looking for. If you are operating in a broad geographical
market, you may have several target group - the primary, secondary, and so
on. Your marketing plan should concentrate on reaching your primary
audience, and allocating smaller budgets for the secondary market.
- Profile of primary audience. You should identify the number of
potential customers, who they are, how often they buy, who they are
currently buying from, how much they spend, and if they are brand or
store loyal. This group is the segment of the market that will consume
your type of goods and services, and hopefully still in search of a
business to patronize. If you are a wedding planner, your main market is
the engaged couple planning to get married within a definite time frame.
- Secondary audience. Utilizing a rifle approach, your secondary
audience is those in the periphery of your main target group.
3. Objectives.
Marketing objectives quantify the results you are looking to achieve. By
clearly stating these results in advance, you provide performance criteria
against which your future results can be compared. Whatever marketing
objectives you decide on, they should meet certain criteria. They must be
realistic, measurable, and be guided by short, medium and long-term
deadlines.
- Profit. Profit objectives state the bottom line progress you
want your marketing efforts to achieve. You may set the goal of
achieving 2 percent profit in your first year, and increasing it by 10
percent every year hereafter.
- Market share. Market share objectives state your desired cut of
the total industry sales pie, or at least the local industry. If the
total revenue of all the wedding planners in your county is $2 million,
how much of that is yours? If you only have 2% of that pie, you may want
to increase your share to about 10% after launching your marketing
campaign.
- Sales volume target. Your sales volume affects your cost
structure: the higher the sales that you generate, the lower your cost.
Specific sales volume levels can give you more bargaining power with
your suppliers. Sales volume objectives should clearly state the total
goods or services you intend to deliver. Your goal can be to increase
your sales in the next two months after a marketing campaign by $10,000.
4. Strategies. This
is the core of your marketing plan. It contains a complete breakdown of
marketing activities that you plan to undertake.
- Marketing communications platform. Your promotional strategy
must address the who, what, where and how much money to spend.
- Marketing tools. Describe how each and every marketing tool
will be used and the purpose. Tools can include advertising, public
relations, special promotions and direct mail. Clarify how direct mail
is to be utilized and who will receive it. Each component of your
promotional mix plans a role in your effort to have potential customers
learn about your business and buy your goods or services.
- Media rationale. This section details how your messages will
reach target audiences, including the list of publications where your
ads will appear, ad sizes and costs.
- Media Schedule. Media schedule is what is called in the
industry as "insertion dates" or when your ads will appear. If
you are running radio ads, for example, this will include the list of
stations that will carry the ad, the duration, target audience, schedule
reach and frequency, and costs.
5. Tactics.
Once your planning is complete, prepare a calendar that will list the
schedule of your strategies and specific activities. Your schedule must be
balanced between executing your marketing strategies and time for crucial
lead generation.
6. Budget.
The final section of your marketing plan is to determine your budget, making
sure that you have the funds to cover your production, printing, media and
other miscellaneous expenses.
- Production. This can include the creation of your logo design,
stationery, mailing labels, company brochure, photography used,
advertising and direct mail costs.
- Printing. This will cover the printing costs of your letterhead
and envelopes, company brochures, and direct mail.
- Media. This is the cost of buying media for your print ads,
radio ads and other tactics.
- Miscellaneous. Other costs that may be incurred such as
postage, holiday cards, thank you notes and others.
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