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Marketing plans help target customersBy Bud Gayhart
For any business to be successful, revenue must be generated through the sale of products and/or services. This makes development of a marketing plan extremely important. In this month's column, I present an overview of the elements of a marketing plan and delve deeper into getting started on your plan by examining market segmentation. The following months' columns will cover the remaining elements in detail to help you develop a complete marketing plan for your business. Drafting a comprehensive marketing plan takes time and requires thorough research. A comprehensive marketing plan will include the following: • An evaluation of the various market segments • Identification of the target audience • Delineation of customer demographics and psychographics • Competitor analysis • Technology trends • Pricing strategies • Advertising and promotion campaigns • Sales force development /training All of these elements need to be addressed. Some will be more relevant than others, depending upon the nature of your business. Finally, you need to pull all of these components together into a formal roadmap for the future. To get started, spend time looking at market segmentation and how that allows you to identify customers through demographic clusters and psychographic similarities. There are several ways to segment a market: by geography, by demographics and by psychographics. You need to determine which technique will best serve your business. When you segment a market by geography, you choose to promote your goods or services to a community, county, region, state, nation or globally. What option(s) will provide you with the greatest benefit at the lowest cost? What do you know about your current customers? Where are they located? If you have their address in your customer database you can easily sort them based upon Zip codes to find out where they reside. If you do not have a system capable of tracking that, ask your customers (as they are buying things) what their Zip code is. Also, ask them how they heard about your company. Did they respond to an advertisement or did they just happen to wander in? You really need to know where your customers are coming from so you can plan future advertising campaigns. If you are missing some regions, how can you construct a campaign to attract them? Identifying your customers by demographic categories enables you to develop more effective advertising and promotion programs aimed at your distinct customer groups. As you look at the demographic components, ask yourself: What gender are my customers? What age groups do they fall into? What income level do they have? What education level have they attained? Is ethnicity or religion an important factor? What about children - do they have kids at home and what are their ages? If you don't know the answers, start collecting that information via an anonymous survey tool. Another method of market segmentation is the grouping of customers by psychographic similarities. Psychographics is the use of demographics to study and measure attitudes, values, lifestyles and opinions for marketing purposes. This includes personality, buying motives and the consumers' usage of the products. Understanding your customers at this level aids in optimizing your promotional strategies to appeal to their purchase motives, usage styles and lifestyles. For example, the market for sunscreen may consist of psychographics segments with purchase motives of health, beauty and safety. The usage styles for sunscreen may include multiple times a day, daily, event-only or less frequently. The lifestyles of sunscreen purchasers may include athletes, parents with young children, older people concerned about skin cancer, people who spend recreational time outdoors or boating enthusiasts. Psychographic characteristics inform not only advertising decisions but also packaging and distribution of products. Methods of gathering psychographic data include conducting individual interviews, organizing focus group studies and purchasing reports from companies that compile market research. A comprehensive marketing plan is a challenge to create but is necessary for a business to allocate advertising/promotion dollars that will have the greatest potential for generating additional revenue and growth for the business. Spend some time thinking about market segmentation and decide how to best evaluate your customers. As we look at the remaining elements of the marketing plan over the next few months, you will have the tools to customize your plan to make it conform to your market. Bud Gayhart is interim director of the Center for Innovation and Business Development at UW-Whitewater. madison.com ©2009 Capital Newspapers. All rights reserved. |
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