When did you last see your marketing plan
Telegraph Business Club 25 Aug 09
For many businesses
both large and small, the marketing plan is just one element of the annual
round of the planning process. Depending on the culture of the business, that
planning process precedes or follows the annual budget.
In some organizations, it is not unusual for the budget to be set first, followed
by the planning process. When this happens, the budget may be set by the Chief
Executive Officer (CEO) and Chief Financial Officer (CFO) in an apparently
arbitrary way, which is often based on an extrapolated increase or decrease
in income, costs and investment. The new budget is then announced and managers
are expected to plan accordingly. Surprisingly, there are a number of successful
companies that perform in this way. However, making a budget without a proper
appreciation of the current and prevailing marketing situation, means that
at best, the budget will probably be set too low. This could mean that while
the business achieves its targets, it may well be performing at less than
capacity. At worst, when set in this way without relation to the marketing
resources or prevailing market conditions, the financial objectives may be
beyond the capability of the business to achieve them.
The Chief Marketing Officer (CMO) is responsible for producing the income
of the business through the anticipation and satisfaction of customers’
demand for its products or services. How much income the marketing function
produces, depends in part on the state of the market, in terms of the level
of demand, as well as the customers’ ability and desire to purchase.
In addition, the suitability of the product or service to meet the requirements
of customers, the strength and activity of competitors, as well as the ability
of the marketing organization to find potential customers, and complete profitable
sales, are all fundamental in achieving the financial and marketing objectives.
It is unfortunate that for many executives, business and marketing plans tend
to be seen as annual rituals, rather than working documents. For the marketer,
the marketing plan sets out the financial objectives in terms of the expected
level of revenue, and the return on investment. The plan should also outline
the marketing strategy to be employed, the sales actions and sales support
that are required, and the financial resources available for costs and investment.
If marketing plans are set out properly, they will have clear achievement
requirements at regular points throughout the year, so that progress may be
assessed and verified. However, the current state of world markets may be
described as volatile, so that as the Chinese say, we live in “interesting
times”. While the marketer must continually measure performance against
the marketing plan, it is also important to consider the plan in relation
to developments in the market. It is especially important to understand how
market conditions and financial constraint affect customers and their ability
and willingness to continue to buy. In these circumstances, what should the
marketer do?
The first thing that the marketer should do is to look at the planned marketing
objectives and assess whether they are still valid in the present situation,
and if not, how they may have changed. The business is dependent on marketing
achieving the desired level of profitable income, but with changed market
and economic circumstances is this still possible with the existing plan?
Are sales targets likely to be achieved from the principle customers, or have
their requirements been deferred or no longer needed?
“No battle plan survives contact with the enemy” and the same
may be said for business and marketing plans. As soon as marketing plan is
put into action, it requires change and development to meet changing market
conditions. In the current business climate, marketers must expect business
conditions to be changing, perhaps quite rapidly, and therefore they need
to be continually revising their action plans or if necessary enacting pre
prepared contingency actions. While constantly re-appraising the marketing
plan, marketers need to be able to answer the following questions:
* Is the money coming in as planned? If not, - why?
* Are the principle orders likely to be confirmed as planned?
* Are customers intentions still valid, - how do we know?
* Will the contingency plan need to be enacted or is it already in operation?
Both the business and marketing plans should not be just annual rituals, but
working documents in constant use, defining the route to take a business from
where it is to where it has to be. For the marketing plan, the only elements
that should be fixed are those of the marketer’s financial objectives,
and possibly the business and marketing strategies to be employed it their
achievement. But to be useful, the plan must be constantly updated, in the
light of market conditions and business success. The actions, by which the
marketer produces sustainable business income, may be subject to frequent
change. Ignoring the marketing plan, especially in times of market volatility,
means that resources are unlikely to be used efficiently, and objectives,
especially in terms of financial revenue are less likely to be achieved.
© N.C.Watkis, Contract Marketing Service 14 Jul 09
Contract Marketing Service, (Marketing Performance Consultants)