business plans and marketing strategy

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free business planning and marketing tips, samples, examples and tools - how to write a business plan, techniques for writing a marketing strategy, strategic business plans and sales plans

Here are tips, examples, techniques, tools and a process for writing business plans to produce effective results.

This free online guide explains how to write a marketing or business strategy, a basic business plan, and a sales plan, using free templates, tools and examples, such as SWOT Analysis. PEST Analysis. the 'Ansoff Matrix' and the 'Boston Matrix'.

Separately the marketing guide offers more specific explanation and theories and tools for marketing strategy and marketing planning, including techniques and tips for advertising, public relations (PR), press and media publicity, sales enquiry lead generation, advertising copy-writing, internet and website marketing, etc.

The sales training guide offers detailed theories and methods about sales planning and selling, extending to cold calling and negotiation skills and techniques. especially relating to selling.

Sometimes people use the term business plan when they are referring to a project. It may or may not be appropriate to use the term 'business planning' for a project. Some projects are very substantial and equate to an autonomous (independent) business activity, in which case a business plan is entirely appropriate. Other projects are smaller, perhaps limited to internal change or development, and are less likely to require a conventional business plan, and are quite adequately planned and managed via project management methods.

Business planning terminology can be confusing because much of it is used very loosely, and can mean different things.

Here is a way to understand it better:

business planning terminology..

Terminology in business planning is often used very loosely. When people talk and write about business planning different terms may mean the same thing, and a single term can mean different things.

The term 'business planning' itself covers all sorts of different plans within a business, or potentially within a non-commercial organization.

The words 'strategy' and 'strategic' arise often in the subject of buisness planning, although there is no actual difference between a 'business plan' and a 'strategic business plan'. Every business plan is arguably 'strategic'. Everyone involved in planning arguably adopts a 'strategic' approach.

Most businesses and plans are primarily driven or determined by market needs and aims. This increasingly applies to many non-commercial activities (government services, education, health, charities, etc), whose planning processes may also be described as 'business planning', even though such organizations may not be businesses in the way we normally imagine. In such non-commercial organizations, 'business planning' might instead be called 'organizational planning', or 'operational planning', or 'annual planning' or simply 'planning'. Essentially all these terms mean the same, and increasingly the tendency is for 'business planning' to become a generic (general) term to refer to them.

I should clarify that finance is of course a major and unavoidable aspect of business and organizational activities, but in terms of planning, finance is a limiting or enabling factor; finance is a means to an end, or a restriction; finance in itself is not a basis for growth or strategy. Markets/customers, product/service development, and sales, provide the only true basis for businesses to define direction, development, growth, etc. and thereby business strategy and planning.

Business planning always starts with or revisits the basic aim or need to provide products or services to customers - also called a market or 'market-place'. Consequently business plans tend first to look outwards, at a market, before they look inwards, at finance and production, etc.

This means that most business plans are driven by marketing, since marketing is the function which addresses market opportunity and need, and how to fulfil it.

Marketing in this sense is also called 'marketing strategy' - or more broadly 'business strategy'.

In many simple, small, and/or old traditional businesses, 'marketing' is often seen instead to be 'sales' or 'selling' (usually because in such businesses selling is the only marketing activity), in which case a 'sales plan' may be the main driver of strategy and the business plan.

Many people use the words 'sales' or 'selling' and 'marketing' to mean the same thing - basically selling products or services to customers, in the broadest sense. In fact, marketing refers to much wider issues than sales and selling. Marketing involves the strategic planning of a business (or other organizational provider) through to every aspect of customer engagement, including market reserach, product development, branding, advertising and promotion, methods of selling, customer service, and extending to the acquisition or development of new businesses. Sales or selling is an activity within marketing, referring to the methods and processes of communicating and agreeing and completing the transaction (sale) with the customer.

Given all this, it is hopefully easier to understand why, depending on a person's role or standpoint or the department in which they work, 'business planning' may be referrred to in many and various ways, for example as 'sales planning', 'marketing planning', 'strategic planning', etc. and that all these terms might mean slightly different things, according to the situation.

If there is a technically correct definition of 'business planning', then perhaps we can best say that 'business planning' refers to the plan of the overall organization, or to a unit or division within an organization with responsibility for a trade or profit. A business plan technically contains and reflects the individual plans for the different functions within the whole operation, each of which may have its own detailed 'business plans', which might be called business plans, or more correctly departmental or functional plans according to their purpose, such as a marketing plan, sales plan, production plan, financial plan, etc.

Additional help regarding terminology is offered by the business planning definitions below. Other definitions and explanations are offered in the business glossary. and in the shorter glossaries of the sales and marketing sections.

Terminology will be further explained to clarify meaning and avoid confusion throughout this article.

introduction

Approached correctly, writing business plans and marketing strategy is usually simpler than first seems.

Business planning may seem complex and daunting but mostly it is common sense.

Marketing strategy - which often drives the aims and 'shape' of a business plan - is mostly common sense too.

Business plans, and the strategy which drives them, are based on logic, or cause and effect.

"I want to achieve a certain result - so what will cause this to happen?"

Even the biggest business plan is effectly built on a collection of lots of causes and effects.

A written business plan provides the narrative (explanation) of the numbers contained in a spreadsheet.

When we see lots of numbers in a computer spreadsheet we can forget this, but the numbers are merely a reflection of scale and detail, and of computerised calculations and modelling, etc.

In fact often when we are confronted with a complex planning spreadsheet containing thousands of numbers, what we are actually being offered is a ready-made planning tool. In many cases, where business planning is a continuation of an ongoing situation, the most frightening spreadsheets can provide a very easy template for future plans, especially with a little help from a colleague in the acciounts department who understands how it all works.

Ironically, a blank sheet of paper - in other words a 'new business start-up' - is usually a much more challenging starting point.

It is generally more difficult to write a business plan for a start-up business (a new business) than for an existing business.

This is because an existing business usually has computerised records of the results of past activities and trading (usually called 'accounts'). Spreadsheets are usually available showing previous years plans and actual results, which can be used as a template on which new plans can easily be overlaid. Writing a new business plan for the continuation or development of such an existing situation obviously enables much of the planning to be based on existing figures, ratios, statistics, etc.

New business start-up situations by their nature tend to have no previous results, so we often refer to this sort of planning as 'starting with a blank sheet of paper'.

New business start-ups - especially if you are the owner or entrepreneur - present bigger planning challenges in some respects because we have no previous records to act as a guide, but in other respects they offer wonderful opportunities to create genuinely innovative and exciting founding principles - your own new business philosophy - on which your plans can be built and developed.

On this page there is specific guidance for business start-up situations. See the simple business start-up principles.

Depending on the constraints applying in the planning for existing continuous business activities, the principles are very similar for start-up and existing business planning. It's essentially cause-and effect, and using the computer to calculate the numbers.

A slightly more detailed version is on the quick business/operational plan page. and begins with

To explore personal direction and change (for example for early planning of self-employment or new business start-up) see the passion-to-profit exercise and template on the teambuilding exercises page.

See also the simple notes about starting your own business. which to an extent also apply when you are starting a new business initiative or development inside another organisation as a new business development manager, or a similar role.

Here's a free profit and loss account spreadsheet template tool (xls) for incorporating these factors and financials into a more formal phased business trading plan, which also serves as a business forecasting and reporting tool too.

Adapt it to suit your purposes. This plan example is also available as a PDF, see the Profit and Loss Account (P&L) Small Enterprise Business Plan Example (PDF). The numbers could be anything: ten times less, ten times more, a hundred times more - the principle is the same.

Towards the end of this article there is also a simple template/framework for a feasibility study or justification report. such as might be required to win funding, authorisation or approval for starting a project, or the continuation of a project or group, in a commercial or voluntary situation.

If you are starting a new business you might also find the tips and information about buying a franchise business to be helpful, since they cover many basic points about choice of business activity and early planning.

(Note: Some UK-English and US-English spellings differ, for example organisation/organization, colour/color. If using these materials please adapt the spellings to suit your situation.)

how to write strategic marketing plans, business plans and sales plans

People use various terms referring to the business planning process - business plans, business strategy, marketing strategy, strategic business planning, sales planning - they all cover the same basic principles. When faced with business planning or strategy development task it's important to clarify exactly what is required: clarify what needs to be done rather than assume the aim from the description given to it - terms are confused and mean different things to different people. You'll see from the definitions below how flexible these business planning terms are.

business planning definitions

a plan - a statement of intent - a calculated intention to organize effort and resource to achieve an outcome - in this context a plan is in written form, comprising explanation, justification and relevant numerical and financial statistical data. In a business context a plan's numerical data - costs and revenues - are normally scheduled over at least one trading year, broken down weekly, monthly quarterly and cumulatively.

a business - an activity or entity, irrespective of size and autonomy, which is engaged in an activity, normally the provision of products and/or services, to produce commercial gain, extending to non-commercial organizations whose aim may or may not be profit (hence why public service sector schools and hospitals are in this context referred to as 'businesses').

business plan - this is now rightly a very general and flexible term, applicable to the planned activities and aims of any entity, individual group or organization where effort is being converted into results. for example: a small company; a large company; a corner shop; a local window-cleaning business; a regional business; a multi-million pound multi-national corporation; a charity; a school; a hospital; a local council; a government agency or department; a joint-venture; a project within a business or department; a business unit, division, or department within another organization or company, a profit centre or cost centre within an an organization or business; the responsibility of a team or group or an individual. The business entity could also be a proposed start-up, a new business development within an existing organization, a new joint-venture, or any new organizational or business project which aims to convert action into results. The extent to which a business plan includes costs and overheads activities and resources (eg. production, research and development, warehouse, storage, transport, distribution, wastage, shrinkage, head office, training, bad debts, etc) depends on the needs of the business and the purpose of the plan. Large 'executive-level' business plans therefore look rather like a 'predictive profit and loss account', fully itemised down to the 'bottom line'. Business plans written at business unit or departmental level do not generally include financial data outside the department concerned. Most business plans are in effect sales plans or marketing plans or departmental plans, which form the main bias of this guide.

strategy - originally a military term, in a business planning context strategy/strategic means/pertains to why and how the plan will work. in relation to all factors of influence upon the business entity and activity, particularly including competitors (thus the use of a military combative term), customers and demographics, technology and communications.

marketing - believed by many to mean the same as advertising or sales promotion, marketing actually means and covers everything from company culture and positioning, through market research, new business/product development, advertising and promotion, PR (public/press relations), and arguably all of the sales functions as well. Marketing is the process by which a business decides what it will sell, to whom, when and how, and then does it.

marketing plan - logically a plan which details what a business will sell, to whom, when and how, implicitly including the business/marketing strategy. The extent to which financial and commercial numerical data is included depends on the needs of the business. The extent to which this details the sales plan also depends on the needs of the business.

sales - the transactions between the business and its customers whereby services and/or products are provided in return for payment. Sales (sales department/sales team) also describes the activities and resources that enable this process, and sales also describes the revenues that the business derives from the sales activities.

sales plan - a plan describing, quantifying and phased over time, how the the sales will be made and to whom. Some organizations interpret this to be the same as a business plan or a marketing plan.

business strategy - see 'strategy' - it's the same.

marketing strategy - see 'strategy' - it's the same.

service contract - a formal document usually drawn up by the supplier by which the trading arrangement is agreed with the customer. See the section on service contracts and trading agreements.

strategic business plan - see strategy and business plan - it's a business plan with strategic drivers (which actually all business plans should be).

strategic business planning - developing and writing a strategic business plan.

philosophy, values, ethics, vision - these are the fundamentals of business planning, and determine the spirit and integrity of the business or organisation - see the guide to how philosophical and ethical factors fit into the planning process. and also the principles and materials relating to corporate responsibility and ethical leadership.

You can see that many of these terms are interchangeable, so it's important to clarify what needs to be planned for rather than assuming or inferring a meaning from the name given to the task. That said, the principles explained here can be applied to business plans of all sorts. Business plans are often called different names - especially by senior managers and directors delegating a planning exercise that they do not understand well enough to explain. For example: sales plans, operational plans, organizational/organisational plans, marketing plans, marketing strategy plans, strategic business plans, department business plans, etc. Typically these names reflect the department doing the planning, despite which, the planning process and content required in the document is broadly similar.

Other useful and relevant business planning definitions are in the business dictionary ; the sales and selling glossary ; some are also in the financial terms glossary. and more - especially for training - are in the business and training acronyms listing. which also provides amusing light relief if this business planning gets a little dry (be warned, the acronyms listings contain some adult content).

when writing a business or operating plan, remember.

A useful first rule of business planning is to decide what you are actually trying to achieve and always keep this in mind. Write your aim large as a constant reminder to yourself, and to anyone else involved. Keeping your central aim visible will help you minimise the distractions and distortions which frequently arise during the planning process.

An increasingly vital and perhaps second rule of business planning is to establish a strong ethical philosophy at the outset of your planning. This provides a vital reference for decision-making and strategy from the start. A strong clear ethical code communicates your values to staff, customers, suppliers, and creates a simple consistent basis for operations which conventional financials, processes, systems and even people, do not address. It is very difficult to introduce ethical principles later into an enterprise, especially when planning shifts into implementation, and more so if problems arise relating to integrity, honesty, corporate responsibility, trust, governance, etc. any of which can have massive impact on relationships and reputation. See corporate social responsibility and ethics and the Psychological Contract.

It is easy to address issues of ethics and corporate responsibility when you are the owner of a new enterprise. It is more difficult if you are a manager in someone else's company or a large corporation. Nevertheless ethics and corporate responsibility are highly significant in planning, and strong justification for their proper consideration can now be made. There are now plenty of recent examples of corporations - indeed entire national economies and governments - which have failed because of poor regard to ethical considerations. The world is changing and learning, slowly, but it is, and anyone ignoring ethics in planning today does so at their own peril.

A third crucial requirement for business plans is return on investment. or for public services and non-profit organisations: effective use of investment and resources, which is beyond simple 'cost control'.

For the vast majority of organisations, whether companies, public services, not-for-profit trusts and charities, all organisations need to be financially effective in what they do, otherwise they will cease to function.

Ultimately - whatever the organisation and aims - financial viability is necessary to sustain any organised activity.

While it's essential to manage ethical and socially responsible aspects of organisational aims. these must allow for adequate return on investment (or in less traditional and 'non-profit' enterprises, must allow for the effective use of investment and resources. according to the financial requirements of the particular organisation).

Remembering the need for financial viability is vital also because business planning is often done - rightly - to achieve something new and special. This tends

to focus thinking on creativity, innovation, ambition, quality, excellence, perhaps even social good, etc. which can easily distract planning away from the basic need to be financially viable - and crucially not to make a loss. By treating return on investment as a vital requirement of planning we increase the likelihood that plans will be viable and therefore sustainable.

Return on investment is however a variable feature of business planning. It is flexible according to the type of enterprise, its main purpose and philosophy.

In a conventional profit-driven corporation return on investment (at an optimal rate) is typically a strong strategic driver for local planning and decisions, and by implication also a basic requirement of the enterprise as a whole. On the other hand, in a business or organization less focused on shareholder reward, such as a public services trust or charity, or a social enterprise or cooperative, return on investment (at a relatively lower rate), may be a requirement simply to sustain viable operations, according to the aims of the enterprise. In the first example, return on investment is the aim; in the second example, return on investment enables some other higher aim to be achieved. In more detail:

In a traditional profit-driven corporation, return on investment tends to be the main requirement of any business plan and also the main aim or purpose or driver of the plan. In most traditional corporations return on investment tends to be at the heart of all activities, since typically the corporation exists to maximize the yield (profit and growth effectively) of shareholder funds invested in the business. Planning in traditional corporations at times forgets this basic obligation, especially when a junior manager is asked to 'write a business plan' for the first time.

In traditional profit-driven corporations, when a new manager starts to write a business plan or operational plan for the first time (and for some experienced managers also, for the umpteenth time), the manager wonders: What is the aim? What am I trying to achieve? Often when they ask their own manager, the manager has the same doubts. The central aim is usually return on investment.

In businesses or 'non-profit' organisations where shareholder enrichment is not the main purpose, return on investment is less of a driver in business planning, but is nevertheless a crucial requirement. Such enterprises are becoming more popular, and will continue to become so, since the collapse of the western economies in 2008, and increasing disillusionment with old-style business thinking. Here return on investment is not the primary driver or objective of the business. Instead the main driver of enterprise may be some other purpose.

An example of 'some other purpose' might be the activities of a social enterprise or cooperative, or maybe an employee ownership company, or perhaps a trust or charity, whose main aim is (rather than the traditional profit generation for external/institutional shareholders) perhaps to benefit its members/staff, and/or to sustain local jobs, and/or to benefit the local community, or maybe to advance science or learning or health, etc. Here, while return on investment may seem less crucial or appropriate to planning and operations, the enterprise must nevertheless remain financially viable. or it ceases to be able to operate at all.

In such examples, return on investment in business planning is not usually maximized, but must still be treated as an underpinning requirement to planning, and flexed according to the fundamental aims and financial requirements of the enterprise.

Before planning, therefore, it is helpful to understand clearly:

  1. What are we actually aiming to achieve?
  2. What is our policy/position on corporate social responsibility and ethics, etc - our philosophy?
  3. And what return on investment (or alternative financial performance) does our activity/enterprise require - is this a strategic driver in itself, or simply the means by which we maintain our activities in support of our (point 1) aims?

planning - cause and effect..

The basic methodology of business planning is identifying causes and effects. according to your relevant business requirements (financials and ethics) and strategic drivers (what we are actually aiming to achieve).

Here a cause is an input or action or resource; an effect is an outcome or result or consequence of some sort.

We want to achieve xyz effect (for example a given return on investment, or a certain sales level or market share, whatever) - so what should we plan to cause this to happen?

Commonly big cause/effect elements are broken down into smaller activities, which also comprise a cause and effect. (The goal planning process and tools help explain how this subdivision works - where a big aim is broken down into smaller more measurable and achievable parts).

Junior managers have responsibility for plans and activities which feed into larger departmental plans and activities of senior managers. The plans and activities of senior managers feed into the divisional plans of executives and directors. There is a hierarchy or tree structure of cause and effects, all hopefully contributing to the overall organizational aim.

In many good businesses a substantial business planning responsibility extends now to front line customer-facing staff, and the trend is increasing. In this context, the business plan could be called also be called a marketing plan, or a sales plan - all departmental plans are basically types of business planning:

"What you are going to sell to whom, when and how you are going to sell it, how much contribution (gross profit) the sales will produce, what the marketing and/or selling cost will be, and what will be the return on investment."

Where a department is a 'cost centre' not a 'profit-centre' - providing products or services internally to other departments rather than externally to customers - then the language and planning elements may alter, but the principles remain the same.

Also, these principles and methods apply to very large complex multinational organizations, which tend to entail more and different costs, fixed overheads, revenues, and consequently larger planning formats; more and bigger spreadsheets, more lines and columns on each, more attention and people working on the numbers, more accountants, and typically - especially at middle-management level and above - more emphasis on cashflow and the balance sheet, alongside basic 'profit and loss' planning.

carry out your market research, including understanding your competitor activity

'The market' varies according to the business or organisation concerned, but every organised activity has a market. Knowing the market enables you to assess and value and plan how to engage with it. A common failing of business planning or operational planning outside of the 'business' world, is to plan in isolation, looking inward, when ideas can seem very positive and reliable because there's no context and nothing to compare. Hence research is critical. And this applies to any type of organisation - not just to businesses. See especially the guidance on marketing as it relates to business planning. Planning very much concerns processes. The principles of marketing will explain additionally how to put meaning and values into what you plan.

Your market research should focus on the information you need, to help you to formulate strategy and make business decisions. Market research should be pragmatic and purposeful - a means to an end, and not a means in itself. Market information potentially covers a vast range of data, from global macro-trends and statistics, to very specific and detailed local or technical information, so it's important to decide what is actually relevant and necessary to know. Market information about market and industry trends, values, main corporations, market structure, etc, is important to know for large corporations operating on a national or international basis. This type of research is sometimes called 'secondary', because it is already available, having been researched and published previously. This sort of information is available from the internet, libraries, research companies, trade and national press and publications, professional associations and institutes. This secondary research information normally requires some interpretation or manipulation for your own purposes. However there's no point spending days researching global statistical economic and demographic data if you are developing a strategy for a relatively small or local business. Far more useful would be to carry out your own 'primary' research (i.e. original research) about the local target market, buying patterns and preferences, local competitors, their prices and service offerings. A lot of useful primary market research can be performed using customer feed-back, surveys, questionnaires and focus groups (obtaining indicators and views through discussion among a few representative people in a controlled discussion situation). This sort of primary research should be tailored exactly for your needs. Primary research requires less manipulation than secondary research, but all types of research need a certain amount of analysis. Be careful when extrapolating or projecting figures to avoid magnifying initial mistakes or wrong assumptions. If the starting point is inaccurate the resulting analysis will not be reliable. For businesses of any size; small, local, global and everything in between, the main elements you need to understand and quantify are:

  • customer (and potential customer) numbers, profile and mix
  • customer perceptions, needs, preferences, buying patterns, and trends, by sub-sector if necessary
  • products and services, mix, values and trends
  • demographic issues and trends (especially if dependent on consumer markets)
  • future regulatory and legal effects
  • prices and values, and customer perceptions in these areas
  • distribution and routes to market
  • competitor activities, strengths, weaknesses, products, services, prices, sales methods, etc

Primary research is recommended for local and niche services. Keep the subjects simple and the range narrow. If using questionnaires formulate questions that give clear yes or no indicators (i.e. avoid three and five options in multi-choices which produce lots of uncertain answers) always understand how you will analyse and measure the data produced. Try to convert data to numerical format and manipulate on a spreadsheet. Use focus groups for more detailed work. For large research projects consider using a market research organization because they'll probably do it better than you, even though this is likely to be more costly. If you use any sort of marketing agency ensure you issue a clear brief, and that your aims are clearly understood. Useful frameworks for research are PEST analysis and SWOT analysis.

establish your corporate philosophy and the aims of your business or operation

First establish or confirm the aims of the business, and if you are concerned with a part of a business, establish and validate the aims of your part of the business. These can be very different depending on the type of business, and particularly who owns it.

Refer to and consider issues of ethics and philosophy, corporate social responsibility, sustainability. etc - these are the foundations on which values and missions are built.

Consider the Psychological Contract and the benefits of establishing a natural balance and fairness between all interests (notably staff, customers, the organization).

Traditional business models are not necessarily the best ones. The world is constantly changing, and establishing a new business is a good time to challenge preconceptions of fundamental business structure and purpose. A business based on a narrow aim of enriching a few investors while relegating the needs and involvement of everyone else may contain conflicts and tensions at a deep level. There are other innovative business structures which can inherently provide a more natural, cooperative and self-fuelling relationship - especially between employees and the organization, and potentially between customers and the organization too.

When you have established or confirmed your philosophical and ethical position, state the objectives of the business unit you are planning to develop - your short, medium and long term aims - (typically 'short, medium and long' equate to 1 year, 2-3 years and 3 years plus). In other words, what is the business aiming to do over the next one, three and five years?

Bear in mind that you must reliably ensure the success and viability of the business in the short term or the long term is merely an academic issue. Grand visions need solid foundations. All objectives and aims must be prioritised and as far as possible quantified. If you can't measure it, you can't manage it.

define your 'mission statement'

All businesses need a ‘mission statement'. It announces clearly and succinctly to your staff, shareholders and customers what you are in business to do. Your mission statement may build upon a general ‘service charter' relevant to your industry. You can involve staff in defining and refining the business's mission statement, which helps develop a sense of ownership and responsibility. Producing and announcing the mission statement is also an excellent process for focusing attention on the business's priorities, and particularly the emphasis on customer service. Whole businesses need a mission statement - departments and smaller business units within a bigger business need them too.

define your 'product offering(s)' or 'service offering(s)' - your sales proposition(s)

You must understand and define clearly what you are providing to your customers. This description should normally go beyond your products or services, and critically must include the way you do business. and what business benefits your customers derive from your products and services, and from doing business with you. Develop offerings or propositions for each main area of your business activity - sometimes referred to as 'revenue streams', or 'business streams' - and/or for the sector(s) that you serve. Under normal circumstances competitive advantage is increased the more you can offer things that your competitors cannot. Good research will tell you where the opportunities are to increase your competitive advantage in areas that are of prime interest to your target markets. Develop your service offering to emphasise your strengths, which should normally relate to your business objectives, in turn being influenced by corporate aims and market research. The important process in developing a proposition is translating your view of these services into an offer that means something to your customer. The definition of your service offer must make sense to your customer in terms that are advantageous and beneficial to the customer, not what is technically good, or scientifically sound to you. Think about what your service, and the manner by which you deliver it, means to your customer.

Traditionally, in sales and marketing, this perspective is referred to as translating features into benefits. The easiest way to translate a feature into a benefit is to add the prompt ‘which means that. '. For example, if a strong feature of a business is that it has 24-hour opening, this feature would translate into something like: "We're open 24 hours (the feature) which means that you can get what you need when you need it - day or night." (the benefit). Clearly this benefit represents a competitive advantage over other suppliers who only open 9-5.

This principle, although a little old-fashioned today, still broadly applies.

The important thing is to understand your services and proposition in terms that your customer will recognise as being relevant and beneficial to them.

Most businesses have a very poor understanding of what their customers value most in the relationship, so ensure you discover this in the research stage, and reflect it in your stated product or service proposition(s).

Customers invariably value these benefits higher than all others:

  • Making money
  • Saving money
  • Saving time

If your proposition(s) cannot be seen as leading to any of the above then customers will not be very interested in you.

A service-offer or proposition should be an encapsulation of what you do best, that you do better than your competitors (or that they don't do at all); something that fits with your business objectives, stated in terms that will make your customers think ‘Yes, that means something to me and I think it could be good for my business (and therefore good for me also as a buyer or sponsor).'

This is the first 'brick in the wall' in the process of business planning, sales planning, marketing planning, and thereafter, direct marketing, and particularly sales lead generation.

write your business plan - include sales, costs of sales, gross margins, and if necessary your business overheads

Business plans come in all shapes and sizes. Pragmatism is essential. Ensure your plan shows what your business needs it to show. Essentially your plan is a spreadsheet of numbers with supporting narrative, explaining how the numbers are to be achieved. A plan should show all the activities and resources in terms of revenues and costs, which together hopefully produce a profit at the end of the trading year. The level of detail and complexity depends on the size and part of the business that the plan concerns. Your business plan, which deals with all aspects of the resource and management of the business (or your part of the business), will include many decisions and factors fed in from the marketing process. It will state sales and profitability targets by activity. In a marketing plan there may also be references to image and reputation, and to public relations. All of these issues require thought and planning if they are to result in improvement, and particularly increasing numbers of customers and revenue growth. You would normally describe and provide financial justification for the means of achieving these things, together with customer satisfaction improvement. Above all a plan needs to be based on actions - cost-effective and profitable cause and effect; inputs required to achieved required outputs, analysed, identified and quantified separately wherever necessary to be able to manage and measure the relevant activities and resources.

quantify the business you seek from each of your market sectors, segments, products and customer groupings, and allocate investment, resources and activities accordingly

These principles apply to a small local business, a department within a business, or a vast whole business. Before attending to the detail of how to achieve your marketing aims you need to quantify clearly what they are. What growth targets does the business have? What customer losses are you projecting? How many new customers do you need, by size and type, by product and service? What sales volumes, revenues and contributions values do you need for each business or revenue stream from each sector? What is your product mix, in terms of customer type, size, sector, volumes, values, contribution, and distribution channel or route to market? What are your projected selling costs and net contributions per service, product, sector? What trends and percentage increase in revenues and contributions, and volumes compared to last year are you projecting? How is your market share per business stream and sector changing, and how does this compare with your overall business aims? What are your fast-growth high-margin opportunities, and what are your mature and low-margin services; how are you treating these different opportunities, and anything else in between? You should use a basic spreadsheet tool to split your business according to the main activities and profit levers. See the simple sales/business planning tool example below.

ansoff product-market growth matrix - strategic tool

A useful planning tool in respect of markets and products is the matrix developed by Igor Ansoff (H Igor Ansoff, 1918-2002), who is regarded by some as the 'Father of Strategic Management'.

Fully titled the Ansoff Product-Market Growth Matrix, the tool was first published in Harvard Business Review, 1957, in Ansoff's paper Strategies for Diversification.

The Ansoff product-market matrix helps to understand and assess marketing or business development strategy. Any business, or part of a business can choose which strategy to employ, or which mix of strategic options to use.

This is a fundamentally simple and effective way of looking at strategic development options.

Source: www.businessballs.com

Category: Forex

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