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INTRODUCTION Marketing plan

A marketing plan is a written document that details the necessary actions to achieve one or more marketing objectives. It can be for a product or service, a brand, or a product line. Marketing plans cover between one and five years. A marketing plan may be part of an overall business plan. Solid marketing strategy is the foundation of a well-written marketing plan. While a marketing plan contains a list of actions, a marketing plan without a sound strategic foundation is of little use.

The marketing planning process


Marketing process can be realized by the marketing mix in step 4. The last step in the process is the marketing controlling. In most organizations, "strategic planning" is an annual process, typically covering just the year ahead. Occasionally, a few organizations may look at a practical plan which stretches three or more years ahead. To be most effective, the plan has to be formalized, usually in written form, as a formal "marketing plan." The essence of the process is that it moves from the general to the specific, from the overall objectives of the organization down to the individual action plan for a part of one marketing program. It is also an interactive process, so that the draft output of each stage is checked to see what impact it has on the earlier stages, and is amended.

Marketing planning aims and objectives


Behind the corporate objectives, which in themselves offer the main context for the marketing plan, will lie the "corporate mission," which in turn provides the context for these corporate objectives. In a sales-oriented organization, the marketing planning function designs incentive pay plans to not only motivate and reward frontline staff fairly but also to align marketing activities with corporate mission.
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A "traditional" - albeit product-based - format for a "brand reference book" (or, indeed, a "marketing facts book") was suggested by Godley more than three decades ago:
1. Financial dataFacts for this section will come from management accounting, costing and finance sections. 2. Product dataFrom production, research and development. 3. Sales and distribution data - Sales, packaging, distribution sections. 4. Advertising, sales promotion, merchandising data - Information from these departments. 5. Market data and miscellany - From market research, who would in most cases act as a source for this information. His sources of data, however, assume the resources of a very large organization. In most organizations they would be obtained fro a m much smaller set of people (and not a few of them would be generated by the marketing manager alone).

It is apparent that a marketing audit can be a complex process, but the aim is simple: "it is only to identify those existing (external and internal) factors which will have a significant impact on the future plans of the company." It is clear that the basic material to be input to the marketing audit should be comprehensive. Accordingly, the best approach is to accumulate this material continuously, as and when it becomes available; since this avoids the otherwise heavy workload involved in collecting it as part of the regular, typically annual, planning process itself - when time is usually at a premium. Even so, the first task of this annual process should be to check that the material held in the current facts book or facts files actually is comprehensive and accurate, and can form a sound basis for the marketing audit itself.

The structure of the facts book will be designed to match the specific needs of the organization, but one simple format - suggested by Malcolm McDonald - may be applicable in many cases. This splits the material into three groups:
1. Review of the marketing environment. A study of the organization's markets, customers, competitors and the overall economic, political, cultural and technical environment; covering developing trends, as well as the current situation.

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2. Review of the detailed marketing activity. A study of the company's marketing mix; in terms of the 7 Ps 3. Review of the marketing system. A study of the marketing organization, marketing research systems and the current marketing objectives and strategies. The last of these is too frequently ignored. The marketing system itself needs to be regularly questioned, because the validity of the whole marketing plan is reliant upon the accuracy of the input from this system, and `garbage in, garbage out' applies with a vengeance.


Portfolio planning. In addition, the coordinated planning of the


individual products and services can contribute towards the balanced portfolio.

80:20 rule. To achieve the maximum impact, the marketing plan


must be clear, concise and simple. It needs to concentrate on the 20 percent of products or services, and on the 20 percent of customers, which will account for 80 percent of the volume and 80 percent of the profit.

7 P's: Product, Place, Price and Promotion, Physical Environment,


People, Process. The 7 P's can sometimes divert attention from the customer, but the framework they offer can be very useful in building the action plans.

It is only at this stage (of deciding the marketing objectives) that the active part of the marketing planning process begins. This next stage in marketing planning is indeed the key to the whole marketing process. The "marketing objectives" state just where the company intends to be at some specific time in the future. James Quinn succinctly defined objectives in general as: Goals (or objectives) state what is to be achieved and when results are to be accomplished, but they do not state 'how' the results are to be achieved. They typically relate to what products (or services) will be where in what markets (and must be realistically based on customer behavior in those markets). They are essentially about the match between those "products" and "markets." Objectives for pricing, distribution, advertising and so on are at a lower level, and should not be confused with marketing objectives. They are part of the marketing strategy needed to achieve marketing objectives. To be most
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effective, objectives should be capable of measurement and therefore "quantifiable." This measurement may be in terms of sales volume, money value, market share, percentage penetration of distribution outlets and so on. An example of such a measurable marketing objective might be "to enter the market with product Y and capture 10 percent of the market by value within one year." As it is quantified it can, within limits, be unequivocally monitored, and corrective action taken as necessary. The marketing objectives must usually be based, above all, on the organization's financial objectives; converting these financial measurements into the related marketing measurements. He went on to explain his view of the role of "policies," with which strategy is most often confused: "Policies are rules or guidelines that express the 'limits' within which action should occur."Simplifying somewhat, marketing strategies can be seen as the means, or "game plan," by which marketing objectives will be achieved and, in the framework that we have chosen to use, are generally concerned with the 8 P's. Examples are:
1. Price - The amount of money needed to buy products 2. Product - The actual product 3. Promotion (advertising)- Getting the product known 4. Placement - Where the product is located 5. People - Represent the business 6. Physical environment - The ambiance, mood, or tone of the environment 7. Process - How do people obtain your product 8. Packaging - How the product will be protected

In principle, these strategies describe how the objectives will be achieved. The 7 P's are a useful framework for deciding how the company's resources will be manipulated (strategically) to achieve the objectives. It should be noted, however, that they are not the only framework, and may divert attention from the real issues. The focus of the strategies must be the objectives to be achieved - not the process of planning itself. Only if it fits the needs of these objectives should you choose, as we have done, to use the framework of the 7 P's. The strategy statement can take the form of a purely verbal description of the strategic options which have been chosen. Alternatively, and perhaps more positively, it might include a structured list of the major options chosen.
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One aspect of strategy which is often overlooked is that of "timing." Exactly when it is the best time for each element of the strategy to be implemented is often critical. Taking the right action at the wrong time can sometimes be almost as bad as taking the wrong action at the right time. Timing is, therefore, an essential part of any plan; and should normally appear as a schedule of planned activities.Having completed this crucial stage of the planning process, you will need to re-check the feasibility of your objectives and strategies in terms of the market share, sales, costs, profits and so on which these demand in practice. As in the rest of the marketing discipline, you will need to employ judgment, experience, market research or anything else which helps you to look at your conclusions from all possible angles.

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BikeArt
Executive Summary BikeArt is a stand-alone kiosk located in the busy Valley River Mall. BikeArt sells assorted pieces of art as well as furniture made out of recycled bicycle parts. Through outstanding terms and conditions of their lease, BikeArt will be able to display their larger items on the surrounding floor space. This should significantly increase sales as walk through traffic in the wall is very high. BikeArt will target two market segments, industrial art aficionados and bicycle enthusiasts. Both of these groups are populous in Kulai. Kulai is a progressive, liberal city which favors forward-thinking art collectors. Additionally, Kulai is Bike City for Johor Bahru, meaning bicycling is hugely popular. Having good numbers of these populations will fuel growth. BikeArt is forecasted to reach profitability by month nine and will have profits of almost $40,000 by year three.

Situation Analysis BikeArt is a start-up company. Marketing is critical to success and future profitability. The company offers art work constructed out of recycled bicycle parts. BikeArt possesses good information about the market and knows a great deal about the common attributes of the most prized and loyal customers. BikeArt will leverage this information to better understand who is served, their specific needs, and how BikeArt can better communicate with them.

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Market Analysis 2009 Potential Customers Industrial art collectors Bicycling enthusiasts Other Total Growth 8% 10% 0% 5,644 6,096 6,584 7,111 7,680 2010 2011 2012 2013 CAGR 8.00%

12,545 13,800 15,180 16,698 18,368 10.00% 0 0 0 0 0 0.00%

9.39% 18,189 19,896 21,764 23,809 26,048 9.39%

Market Needs BikeArt is providing customers with cutting edge, creative art work designed out of recycled bicycle parts. BikeArt seeks to fulfill the following benefits that are important to their customers:
y

Novelty Items: The products that BikeArt produces are unique and interesting.

y y

Selection: A wide selection of bicycle art work. Accessibility: BikeArt is located in the Valley River Mall and is open all hours that the mall is.

Customer Service: The patron will be impressed with the level of service and attention that they receive.

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Competitive Pricing: BikeArt will price their products to receive a fair margin and to provide the artist with reasonable compensation.

Market Trends One trend within the art industry that BikeArt is riding on is the trend of art to utilize everyday items. This is seen with BikeArt's use of bicycle components. It can also be seen with other artists that go to junk yards to find pieces of metal and then weld the metal into objects such as animal lawn ornaments. The trend of creativity in the construction of art from everyday objects has picked up more and more artists over the last several years.

Market Growth The world wide art industry is huge. Within the industry there are so many niches that artists fill. Art is used as a creative expression, as well as an investment that appreciates over time. As stated before, one trend in the industry is to create art out of ordinary objects. BikeArt will leverage this trend to grow their business. BikeArt forecasts their market to grow at 9% for the next three years.

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SWOT Analysis The following SWOT analysis captures key strengths and weaknesses within the company and describe the threats facing BikeArt. Strengths
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Strong relationships with local artists. Excellent employees who are highly trained to offer outstanding customer service.

y y

Great retail space that provides large amounts of walk-through traffic. High-quality product offerings.

Weaknesses
y y y y

BikeArt lacks visibility. A limited marketing budget to develop company awareness. The struggle to get new, creative, artwork. Ability to keep up with demand for the products.

Opportunities
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A growing market with a significant percentage of the target market still not aware of BikeArt's product offerings.
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The ability to increase the sales volume while maintaining the same overhead costs. The ability to attract new and exciting artists as BikeArt becomes better known.

Threats
y y y

A shortage of art work produced. A slump in the economy which will decrease people's discretionary income. A larger, more established gallery starting to sell more of BikeArt's genre of art work.

Competition BikeArt has several competitors:


y

Other retailers in the

mall. People that are gift shopping at

BikeArt are likely to visit other retailers in the mall. While the other retailers are not direct competitors in the sense that they are selling the same products, their products will act as a substitute product.
y

Art galleries. These retailers specifically sell different types of artwork. While some might specialize or carry a theme of industrial art, none sell bicycle specific art. People that are looking for a wide range of art work are more likely to go to these retailers.

Bicycle retailers. Some bicycle shops carry gifts for cycling enthusiasts, and this gift section may be art work based on bicycles. Some of BikeArt's artists also sell to bicycle shops so they might have identical pieces. The bicycle retailers do not however, have the same selection as BikeArt. As BikeArt grows, they will be able to leverage their vendors to make BikeArt the exclusive dealer for their bicycle art.

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Product Offering BikeArt will sell artwork manufactured from recycled bicycle parts. The art work will be made by approximately three local artists, one of which is Steve's wife Shoodnt. Some of the featured products are: wall clocks, picture frames, chairs, tables, mobiles, wind chimes, book ends, kitchen utensil holders and many other products.

Keys to Success BikeArt's keys to success are the following variables:


y y y y

The ability to develop repeat business. The increase of transaction amounts per customer. The increased diversity and selection of new art work. The foresight of determining future customer preferences.

Critical Issues BikeArt is still in the speculative stage as a retail store. Its critical issues are to continue to take a modest fiscal approach; expand at a reasonable rate, not for the sake of expansion in itself, but because it is economically wise to and continue to develop visibility.

Marketing Strategy BikeArt's marketing strategy will be based on the use of several forms of advertising. BikeArt will generate visibility through advertisements in the local cycling journal,. This journal is read by many cycling enthusiasts, one of the target segments of the market.

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BikeArt will also advertise in the Kulai Weekly, a liberal, progressive living arts newspaper for the Kulai area. The typical reader has a similar market demographics to our customers and the newspaper is read by many because it is the premier source for determining different cultural and musical events that are occurring in Kulai. BikeArt's strategic location of the Valley River Mall will reduce the need to spend a lot of money to generate visibility because the location provides large amounts of walk through traffic which is likely to generate sales. While the typical person that visits Valley RIver Mall is not our typical customer, the mall person will often buy gifts for people and BikeArt's products make excellent gifts. The money saved from not launching a huge marketing campaign is going to be spent in increased monthly rent from the Valley River Mall.

Mission BikeArt's mission is to provide the customer with functional items and art work made out of recycled bicycle parts. We exist to attract and maintain customers. When we adhere to this maxim, everything else will fall into place. Our services will exceed the expectations of our customers.

Marketing Objectives 1. To generate visibility within the art and cycling community. 2. Increase the number of repeat customers. 3. Decrease the amount spent on marketing relative to the sales generated.

Financial Objectives
y y y

A double digit growth rate for the next five years. Decrease variable costs every quarter. Expand from the Valley River Mall store front within the first several years.

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Target Markets BikeArt's market can be divided into two groups, industrial art collectors and bicycle enthusiasts. The industrial art collectors are characterized by people who collect art with an industrial edge. Industrial art is typically characterized through the use of either very technical looking pieces or structures or using parts that existed for another function for the basis of the art work. Industrial art is the opposite of organic art. Industrial art is typically sharp angles, straight lines. The other market is of bicyclist enthusiasts. Kulai is a bicyclist town, one of the hottest in the country. In a town of 130,000, there are three bicycle manufacturers, miles upon miles of bike lanes and independent bike paths. This culture will lend itself to BikeArt. The bicycle enthusiasts are people that ride a lot and appreciate anything related to bicycles, including bicycle art pieces.

Positioning BikeArt will position itself as a cutting edge cycling and industrial art dealer. Both art collectors as well as gift purchasers will be impressed with the selection and creativity of designs. BikeArt will leverage their competitive edge of specialization of a market niche to help position themselves.
y

No one else concentrates on this specific type of art. This is truly a competitive edge since BikeArt is based in Kulai,.

By only concentrating on this niche, prospective customers will correctly assume that BikeArt has the largest selection and are more likely to come to BikeArt, as opposed to going to a bicycle shop looking for art.

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Strategies The single objective of BikeArt is to be known as a premier place for cycling and industrial art in Kulai. The marketing strategy will seek to first create customer awareness regarding the products offered, develop the customer base, and work toward building customer loyalty. The message that BikeArt will seek to communicate is that it is a prime retailer which has a good selection of bicycling artwork. This message will be

communicated through a variety of forms including several advertisements in various targeted journals/newspapers. BikeArt will also leverage the large amount of walk through traffic by creating creative and thought provoking displays of their products to lure in walk by customers.

Marketing Mix BikeArt's marketing mix is comprised of the following approaches to pricing, distribution, advertising and promotion, and customer service.
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Pricing: BikeArt's pricing scheme will be established to create fair compensation for the artists, as well as a reasonable profit margin for the company.

Distribution: All products will be distributed through the Valley River Mall store front.

Advertising and Promotion: The most successful advertising will be in the Kulai Weekly and Oregon Cycling. In addition, unique product displays will catch the eyes of the walk through traffic.

Customer Service: Obsessive customer attention is the mantra. BikeArt's philosophy is whatever is needed to satisfy the customer will be done. While this might hurt short-term profits, it will ensure long-term profitability.

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Marketing Research During the initial phase of the business plan development, several focus groups were held to gain insight into the target market. These focus groups provided helpful insight into the decisions and decision making processes of prospective customers. An additional source of market research that is dynamic is a feedback mechanism based on a suggestion card system. The suggestion card system has several statements that customers are asked to rate in terms of a given scale. There are also several open ended questions that allow the customer to freely offer constructive criticism or praise. BikeArt will work hard to implement reasonable suggestions in order to improve their service offerings as well as show their commitment to the customer that their suggestions are valued.

Financials This section will offer a financial overview of BikeArt as it relates to the marketing activities. BikeArt will address break-even analysis, sales forecasts, expenses forecasts, and how those link to the marketing strategy. Break-even Analysis The Break-Even Analysis indicates $15,395 will be needed in monthly revenue to reach the break-even point.

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Break-even Analysis Monthly Revenue Break-even Assumptions: Average Percent Variable Cost Estimated Monthly Fixed Cost 50% $7,800 $7,852

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Sales Forecast The first month will be used to set up the kiosk and get things underway. During this month the part-time employees will be hired and trained. Sales will begin slowly during this first month. From the second month on, sales will steadily increase because there will be a steady flow of customers that pass by the kiosk.

Sales Forecast 2011 Sales Industrial art collectors Bicycling enthusiasts Total Sales $58,229 $87,531 $145,760 $115,475 $178,745 $294,220 $126,547 $189,785 $316,332 2012 2013

Direct Cost of Sales Industrial art collectors Bicycling enthusiasts

2001 $29,115 $43,766

2002 $57,738 $89,373 $147,110

2003 $63,274 $94,893 $158,166

Subtotal Direct Cost of Sales $72,880

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Expense Forecast Marketing expenses will be budgeted to spike during the spring as well as during the winter holidays, two periods where sales are forecasted to increase during the year.

Marketing Expense Budget 2011 Kulai Weekly Other Other Total Sales and Marketing Expenses Percent of Sales $2,250 $1,800 $0 $4,050 2.78% 2012 $5,000 $4,000 $0 $9,000 3.06% 2013 $10,000 $8,000 $0 $18,000 5.69%

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Controls The purpose of BikeArt's marketing plan is to serve as a guide for the organization. The following areas will be monitored to gauge performance:
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Revenue: monthly and revenue. Expenses: monthly and revenue. Repeat business. Customer satisfaction.

Contingency Planning Difficulties and risks:


y y y

Problems generating visibility. Difficulty obtaining sufficient product to sell. Significantly lower than forecasted demand.

Worst case risks may include:


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Determining that the business cannot support itself on an ongoing basis. Having to liquidate inventory to cover liabilities.

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REFERENCES
1. Marketbut strategy Australian administration small business guide.

2. ^ Baker, Michael The Strategic Marketing Plan Audit 2008. ISBN 1902433998. p.3

3. ^ Baker, Michael The Strategic Marketing Plan Audit 2008. ISBN 1902433998. p. 27

4. ^ Marketing basics Marketing strategy based on market needs, targets and goals.

5. ^ Miles, Raymond (2003). Organizational Strategy, Structure, and Process. Stanford: Stanford University Press. ISBN 0804748403

6. "Slimm Buick - Bike Art"

7. "Bikengruvin - Recycled Bicycle ART"

8. Bicycle Forest's Homebuilders' Gallery

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