Strategic Marketing Development and Planning Guide

1. Market Your Business 5.1 Develop the Marketing Plan 5.2 The Marketing Mix─Product 5.3 The Marketing Mix─Price

2. Lesson 5.1Developing the Marketing Plan Goals • Explain the importance of marketing a business. • Discuss how to develop a marketing strategy for a business. • Describe what information is included in a marketing plan. Chapter 5

3. Vocabulary • marketing • marketing concept • marketing mix • marketing strategy • marketing plan Chapter 5

4. What is Marketing? • marketing • all of the processes used to determine and satisfy the needs of customers and the company • planning • pricing • promoting • distributing • selling Chapter 5

5. marketing concept • Uses the needs of customers as the primary focus of a product or service during: • planning • production • distribution • promotion Chapter 5

6. A successful marketing concept will: • Identify what will satisfy the customers’ needs and wants • Develop and market products or services that customers consider better than other choices • Operate profitably Chapter 5

7. marketing mix • reaching the target market through a blend of: • product • price • distribution • promotion Chapter 5

8. Why is marketing important to a business? Chapter 1

9. The Marketing Strategy • marketing strategy • a plan that identifies how business goals will be achieved through marketing efforts • product introduction or innovation • pricing • distribution • promotion • sales or market share • projected profitability Chapter 5

10. marketing goals should: • be achievable with your available resources • be written following the SMART guidelines • reflect short, medium and long-term goals Chapter 5

11. Short-Term Goals • Achievements for the next year are the focus of short-term goals. • number of customers • level of sales • level of profits Chapter 5

12. Medium-Term Goals • Achievements for the next two to five years are the focus of medium-term goals. • Make sure your marketing strategy facilitates achievement of medium-term goals. Chapter 5

13. Long-Term Goals • Achievements for a 5, 10, or 20 year time horizon are the focus of long-term goals. • Long-term goals can help define current marketing plans. Chapter 5

14. Why is goal setting important when developing a marketing strategy? Chapter 1

15. Write Your Marketing Plan • marketing plan • defines your market • identifies your customers and competitors • outlines a strategy for attracting and keeping customers • anticipates changes Chapter 5

16. The marketing plan should include the following information: • Product or Service • Target Market • Competition • Marketing Budget • Business Location • Pricing Strategy • Promotional Strategy • Distribution Strategy Chapter 5

17. Marketing plans should include performance standards that are measurable. • Actual results should be compared to performance standards quarterly. Chapter 5

18. Why is it important to put your marketing plan in writing? Chapter 1

19. Lesson 5.2The Marketing Mix─Product Goals • Explain how the marketing concept affects decisions regarding the product mix. • Define and describe the importance of product management. Chapter 5

20. Vocabulary • product mix • features • brand • positioning Chapter 5

21. The Marketing Concept and the Product • If you can convince your customers that your products satisfy their needs better than any competitor’s products, then your products become a marketing tool for your business. Chapter 5

22. Consumer-Driven Market • The wants and needs of customers are the most important consideration when developing any product or marketing effort. • The U.S. has changed from a product-driven market to a consumer-driven market. • Consumers are more educated. • Competition includes the global market. Chapter 1

23. Product Mix • product mix • the different products and services a business sells • Entrepreneurs may carry some products that are not profitable just to please customers. • A small percentage of the product selection often makes up the majority of sales revenue. Chapter 5

24. How does the marketing concept affect decisions made about the product mix? Chapter 1

25. Product Management • There is more to a product than consumers may realize. • features • branding • packaging • labeling • positioning Chapter 5

26. Select Product Features • features • product characteristics that will satisfy customer needs • The target market should be considered when selecting product features. Chapter 5

27. Consider Branding, Packaging, and Labeling • brand • the name, symbol, or design used to identify your product • package • the box, container, or wrapper in which the product is placed Chapter 5

28. label • where information about the product is given on the package • The brand, package, and label that you choose for a product help differentiate it from others on the market. Chapter 5

29. Position Your Products or Services • Different products and services within the same category serve different customer needs. • positioning • creating an image for the product in the customer’s mind Chapter 5

30. Why is product management important? Chapter 1

31. Lesson 5.3The Marketing Mix─Price Goals • Identify pricing objectives for a business. • Calculate the price for products using various methods. • Discuss factors to consider when pricing services. • List and describe various pricing strategies. Chapter 5

32. Vocabulary • return on investment • market share • demand-based pricing • cost-based pricing • competition-based pricing • psychological pricing • discount pricing Chapter 5

33. Set Pricing Objectives • price • the amount a customer pays for a product or service • needs to be low enough that customers buy from you • needs to be high enough so revenues exceed expenses Chapter 5

34. Price objectives might include: • maximize sales • discourage competition • establish an image • increase profits • attract customers Chapter 5

35. Return on Investment • investment • the costs of making and marketing a product • return on investment(ROI) • amount earned as a result of the investment • usually expressed as a percentage Chapter 5

36. Market Share • market share • a business’s percentage of the total sales generated by all companies in the same market • The total market for a product must be known in order for market share to be determined. Chapter 5

37. Market Share = Amount of Sales ÷ Total Market Size Chapter 5

38. Chapter 1

39. There are multiple ways to increase market share including: • lowering prices • advertising and promotion • networking with potential customers Chapter 5

40. Why is it important to determine pricing objectives before pricing goods and services? Chapter 1

41. Determine a Price for a Product • There is usually more than one price that can be charged for a product. Chapter 5

42. Demand-Based Pricing • demand-based pricing • pricing that is determined by how much customers are willing to pay for a product or service • Survey potential customers to determine what they would be willing to pay for a product. • The highest price identified is the maximum price that can be charged. Chapter 5

43. Cost-Based Pricing • cost-based pricing • determined by using the wholesale cost of an item as the basis for the price charged • markup price • determined by adding a percentage amount to the wholesale cost of an item Chapter 5

44. Markup amount = Wholesale cost × Percentage markup • Retail Price = Wholesale cost + Markup amount Chapter 5

45. markdown price • determined by subtracting a percentage amount from the retail price Chapter 5

46. Markdown amount = Retail price × Percentage markdown • Markdown Price = Retail price - Markdown amount Chapter 5

47. Competition-Based Pricing • competition-based pricing • pricing that is determined by considering what competitors charge for the same good or service Chapter 5

48. List three methods for determining the price to charge for a product. Chapter 1

49. Price a Service or an Idea • To set a price for a service, consider the following: • the cost of items used in providing the service • the amount of time required to produce the service Chapter 5

50. Time-Based Pricing • The amount of time it takes to complete a service will be the basis for determining the price of the service. • Providers must decide whether the cost of materials will be: • included in the price • listed as a separate charge Chapter 5