To properly manage your marketing plan, it’s vital to develop a sound marketing strategy and objectives, otherwise you are just wasting your time (and money).
A clearly articulated strategy and objectives are key components of a functioning marketing plan, and when they are working together they give your marketing plan a definite purpose, outlines what the plan is trying to achieve and highlights how the plan’s success will measured.
The marketing strategy and ensuing objectives are developed once you have completed the background and SWOT analysis. These two sections will identify the crucial market, industry and consumer insights that will help you develop a competitive strategy and set realistic objectives.
SO, HOW DO YOU SET A MARKETING STRATEGY AND OBJECTIVES?
The strategy outlines exactly what you are trying to achieve, big picture. It is developed based on your current market situation, lifecycle and identified opportunities. The strategy needs to be in line with the overall company strategy, and will involve cooperation from other business units to ensure its success. For example, a marketing strategy could be about retention of existing customers, diversifying the customer base, launch, market share growth, becoming the leader, being the competitor or increasing purchase frequency. For more on marketing strategy, read this post .
The plan’s objectives spell out how the plan will achieve the identified strategy, and they need to be written from a financial and marketing perspective.
Financial objectives will cover off the financial performance of the product or service line covered in the marketing plan – specifically its return and overall profitability. The objectives will support the strategy so for ease of demonstration, let’s assume our strategy is centred on ‘growth’. As a result one of the financial objectives could be: Produce a net profit of $3M through sales of product X within the next 12 months.
The marketing objective will convert the financial objective into something more tangible and specific, spelling out how to reach the desired end result ($3M net profit). Using the above strategy example of growth and the financial objective; for the company to achieve a $3M net profit, an increase in market share would be needed.
To grow market share it may be necessary to increase distribution channels, embark on advertising or amend pricing. To identify the best course of action, the marketing manager needs to crunch numbers and develop scenarios around the financial objective to determine exactly what needs to be done to achieve the $3M net profit target. Let’s imagine in this instance to achieve the financial objective, a market share increase of 5% is needed. It is also identified that the financial objective could be achieved through distribution alone.
A marketing objective therefore may be:
Increase dealer distribution network of product X by 20% over the next 12 months. In both instances, the objectives must be written as S.M.A.R.T, meaning they should be:
- Specific – this is stating exactly what the business is trying to achieve such as increase in sales, revenue or market share.
- Measurable – this puts a measure on the specific and essentially will allow you to know if the objective has been achieved. For example, this measurable can be written as a percentage, raw number or volume.
- Achievable – the objective should be attainable with the current business structure and resources.
- Relevant/Realistic – Is this a sensible objective? Does it match the business capabilities and the current market situation covered in the background analysis?
- Timely – objectives must have a time frame attached to them stating when the objective will be achieved i.e. in 3 months, 12 months or 3 years.
The marketing strategy and objectives are what you will measure the plan’s success or failure against, so it is vital that you monitor its performance regularly. Monitoring your plan will enable you to identify any issues and make the necessary changes to the plan in a timely and proactive manner.
Once you have set your marketing strategy and objectives, the next step of your marketing plan is to identify the marketing mix, in particular identifying what you will need to do in order to achieve success, including any price, product, place or promotional tactics.