Writing Your Business Plan, Step 5: Marketing Plan (Products/Services, Customers, Competition)

May 13, 2009 at 6:28 am Leave a comment

Creative Commons License

Creative Commons License

Yesterday, we covered the first part of the marketing plan: research and economics.  Today, we will cover the second part of marketing, broken into three sub-sections:

  • Products and/or Services
  • Customers
  • Competition

Away we go!

Products and/or Services

In this section, you will be describing your products and/or services as the CUSTOMER sees them.  In other words, describe the selling points of your product or service.  These are some tips and questions that are helpful in writing this section:

Describe your lines of business
If you have a few (or several) products or services break them down into separate sections.  For example, if you have a dessert business, you may want to break this section down into cakes, pies, tarts, and cupcakes.

Describe the features of each product or service
Under each product or service, discuss its characteristics.  If you are a photographer, you may describe not only the product you use, but also your photographic style.  What makes them special and different?

Describe the benefits
How would the customer benefit from your product or service? If you are a wedding planner, discuss how the engaged couple would save time, stress, and heart-ache with your services.

Customers

In this section you will be covering the demographics for your customer.  You may pull some of this information from the research that you did before writing the marketing plan.  But, you may inherently know some of these facts if you’ve been in business for a while.  (If you business goes beyond the wedding industry, you may break this into your different types of customers.)

You’ll want to include:

  • Age of your customers
  • Gender
  • Level of education
  • Level of income
  • Occupation and/or class
  • Geography (do you sell regionally or nationwide)
  • Other (for example, you may be a planner who works mostly with casual outdoorsy couples with a love of the Northwest)

Competition

In this section, you’ll be discussing your competitors.  Let me FOREWARN you: I think this is important to understanding your place in the market and the advantages your business has.  I think it is important in understanding your niche and how to better market and sell your goods.  However, I think it is a mistake to get caught up in your competition.  After being in business for 5 years, I know that collaboration within my industry has benefited my business and the industry as a whole.

First, you’ll list your major competitors and briefly discuss how they compete with you.  For example:

  • Competitor A, located in Wichita, has a bridal shop 2 blocks away from my business but sells to a lower pricepoint.
  • Competitor B, is a web-based bridal shop but makes up 32% of the bridal market business.
  • Competitor C, located in Wichita, has a bridal shop with many of the same labels as my business, but does not have strong branding.

Second, create a competitive analysis table or spreadsheet.  This is a WONDERFUL table created by SCORE (SBA’s counselors to small businesses):

competitive-jpg

In the first column are key competitive factors. Because these vary with each market, you may want to customize the list of factors.  In the cell labeled “My Business,” state honestly how you think you stack up in customers’ minds. Then decide whether you think this factor is a strength or a weakness for you. If you find it hard to analyze yourself this way, enlist some disinterested party to assess you. This can be a real eye-opener.

Now analyze each major competitor.  (We recommend you list 3 competitors for now.) In a few words, state how you think they stack up. In the last column, estimate how important each competitive factor is to the customer. 1 = critical; 5 = not very important.

After you finish the competitive matrix, write a short paragraph stating your competitive advantages and disadvantages.

Next step

Understanding your products or services, how they relate the customer, and how they differ from the competition are all important pieces of your marketing plan.  It enables you to better market yourself, and better separate yourself from others in your industry.  Tomorrow, will delve into this further with our discussion of niche, strategy, and sales distribution.

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Entry filed under: 13 Step Business Plan, Excercises, Market It, Plan It, Strategy.

Writing Your Business Plan, Step 4: Marketing Plan (Research and Economics) Writing Your Business Plan, Step 6: Marketing Plan (Niche, Strategy, and Forecasting)

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