Developing your marketing strategy and objectives should be straightforward once you have completed the background and SWOT analysis.
Clear articulation of a marketing strategy and setting objectives to help you achieve it are key components to a marketing plan, giving the whole process a purpose, outlining what the plan is trying to achieve and highlights how the plan’s success will be measured.
So what is the difference between a strategy and objective and how do you write them?
The strategy outlines exactly what you are trying to achieve, big picture. It is developed based on your current market situation, life cycle and identified opportunities. It needs to draw from the information you have gathered from assessing the market situation.
For example, a marketing strategy could be developed around:
- Retention of existing customers
- Diversifying the customer base
- Brand or product launch
- Market share growth
- Market entry
- Market leadership
- Increasing purchase frequency
Whatever the marketing strategy is, it needs to be in line with delivering on the overall company strategy and will involve cooperation and input from across the business to ensure its success.
The objectives spell out how the marketing plan will produce the identified strategy. When objectives form part of a marketing plan, they need to be written from both a financial and marketing perspective. Let’s look at what that means.
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 centered 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 of growth and the ensuing financial objective; for the company to achieve a $3M net profit, an increase in market share is 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 outlined above, 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.
As mentioned above, the strategy and objectives are what you will measure the plan’s success or failure against so it is vital you monitor performance regularly, this will enable you to identify any issues and make any necessary changes to the plan in a timely and proactive manner.
The next step 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.