How to create a complete marketing strategy
This article is the seventh part of our marketing research stages overview series. To check all the previous stages, click here to find a list of our articles. Today, after learning everything about the market, potential customers, channels of communication, and the proposition, you can offer your customer, we are moving on to composing the grand picture – formulating the marketing strategy. As a reminder, for a more detailed overview, we use the example of an imaginary startup entering the market with an innovative orthopedic pillow made from a rubber grid.
What is a marketing strategy?
In our article about the general view on marketing research, we compared the marketing strategy with military intelligence. Business slang took a lot from the military terminology – tactics, strategy, offense, and defense. Competitors are often perceived as enemies, new products or marketing campaigns as attacks and maneuvers, and so on and so forth. So it’s totally legit to say, that marketing strategy is a general war plan of the company, the plan of action – how to reach potential consumers and turn them into customers.
Speaking of military terminology, there are different levels of military operations – strategic, operational, and tactical – from the biggest scale to the smallest. To be brief, the tactical level is a level of separate battles. In the case of business, it can be the competition between two local stores on one street. The operational level is a level of separate campaigns. For example, the campaign for a separate product from the catalog. And the strategic level is an overall scale. In the case of business, it’s everything related to the business activity. The master plan. But, not the “marketing plan”.
Marketing plan vs marketing strategy
These two terms are often misused. Although they are closely related, you need to distinguish these two concepts. Marketing strategy is a general guideline for your business. Language misleads us here for a bit – the “marketing” part of the strategy refers to the market in general, and the same part in the “plan” refers to “marketing” as an advertising process. The marketing plan is a plan of action you have to do to enforce your promotional activity – how you are going to promote, where, when, and how you will measure the results of your campaigns.
So, to summarize, a marketing strategy is a master plan for your business, and the marketing plan is a plan for promotion activity.
Why the marketing strategy is essential?
Clearly, you can’t act without a plan. While creating the plan for your business activity, you will, basically, conduct marketing research as we are doing now and did in our previous articles. And in the process, you will find out all the details of the process, the obstacles you will face, and the ways you can provide your activity in the most effective way. All the marketing research stages eventually give you results, which become a part of your marketing strategy.
- During the market and competitor analysis, you learn about the state of the market and make conclusions about how much power you have over your market.
- By studying the target audience, and building up the buyer persona, you learn who your promotion has to reach.
- By exploring the communication channels and formulating the sale proposition, you learn how to reach your target audience.
- By knowing to whom, how, and where to sell, you can figure out how to spend your resources in the right places.
- Knowing precisely the numbers, you can theoretically achieve, and you can properly measure your real outcome.
- And finally, as we said, the complete marketing strategy serves as a guideline.
How to develop an effective marketing strategy
Define objectives and goals
Clearly, the main goal of any business is to make profits. Creating the marketing strategy implies defining specific goals – quantity of sales, customer interactions, leads; or the revenue you want to get e.g. each month, or the number of subscribers, likes, and followers on your social media. These countable aims will allow you to determine the exact numbers for the required budget, actions, and effort you have to put in to achieve these goals.
Let’s return to our example startup with a cervical pillow. Of course, the goal of this startup is to sell as many pillows as possible. But this “as many” hinges on the reality – market capacity, the company’s ability to reach and convince the customer, and the production capacity limits. Let’s assume, that our startup already has an arranged shop with all the required equipment and the financial resources for purchasing the raw materials for production. And the max production capacity of this shop is 40 pillows per day, which is equal to 880-920 pillows per month. Let’s not go into financial details and just state that for sustaining the business (buy raw materials, pay salaries and rent) our startup needs $50,000. The price for the product is $100, which means for keeping the business alive, we need to sell 500 pillows per month. We understand, that in reality, the numbers can be absolutely different, all this is just for the example’s sake.
So, here is one of the possible goals we can set – 500 pillows per month minimum. Taking this number, we can set KPIs for the sales team and marketing campaigns. Notionally, if you require 500 sales per month with a response rate of 5%, you have to reach [500×(100/5)=500×20=10000] at least ten thousand people with your advertisements. Up next, knowing these numbers, you can plan further steps. For example, if you reach 900 sales per month, you can afford to expand your production base or spend more on marketing – hire a marketer or create more high-quality ad content (make high-end clips or renders for visualizations).
Conduct the marketing analysis
Well, we won’t go into details about the advantages of full-fledged marketing analysis/research and what results from it you can get. Just click here if you haven’t read about this yet. We made some kind of loop here 🙂
If it was a real go-to-market process, we would have already completed this point. We analyzed the market for our example startup, found the target audience, and formulated the sale proposition in our previous related articles.
Sometimes, as a separate stage of creating the marketing strategy, the “Know your customer” step is singled out. But the marketing research itself contains the stage of studying the targeted customer. It is often highlighted, because of an overwhelming customer-centric approach to business. And it’s ok, you will study your customer, pains, needs, and motivations constantly, anyway.
Know your product and resources
Again, this step is a combination of the previous marketing research steps – market analysis, defining the communication channels, and creating a UVP. All these stages have already been covered in our previous articles. Here we will only say, that for the summary analysis of your product you can use a 4Ps model:
- Product – what you offer and how it meets the client’s needs and pains.
- Price – taking into account the competitor analysis, your expenses, and goals, define the most adequate price you can charge for your product.
- Promotion – where and how to promote to reach the most of your target audience – define communication channels and sale proposition.
- Place – where to sell your product – physical store, website, or some other model.
For our example pillow startup, we already defined, that our product offers the solution to back pain and a smart substitute for casual pillows. It’s a physical product, so it requires at least a minimal showroom, but the main marketing effort will be put on the website and sales through the Internet. Later, when there will be more resources for promotion, some additional options, such as loyalty programs, gifts, partnerships with themed stores, and creative advertisements, can be used.
Define selling techniques
What selling techniques you are going to use? This is not only where and how you are going to advertise your product. At this point, you have to choose a plan or model for the overall algorithm of interaction with your customer. Starting from the first contact (seeing the ad) and up to the confirmed order. This path is called a Customer Journey. It is the set of interactions that a customer has to go through from brand discovery to purchasing and beyond. You need to model this path in detail to predict customer behavior and make it easier. One of the most popular models for building customer journeys is AIDA. It stands for “Attention, Interest, Desire, Action”. This is a very exciting and wide topic to speak about right now, so, we will cover it in one of our future articles.
Again, this is all for the sake of an example – the simplest option of a customer journey for our pillow. Our target customer, a clerk, who suffers from back pain while sitting in the office 8 hours per day, 5 days a week, sees our ad in the news feed of some social networks. The message on the picture contains the words “back pain” and “relief”, which trigger the clerk’s attention. He/she clicks on the ad and goes to the website, where he/she sees a fancy video of pleased people on the front page. Right below the video, there is a tempting offer to purchase one of three variations of the cervical pillow with a tasty discount with one click. After choosing the suitable option, the customer goes to the checkout and, as a busy person, chooses a free express delivery right to the doorstep.
On the evening of the same day or, at maximum, the next day, the customer gets the product. And on the following day takes the pillow to work, puts it under his/her back, and at the end of the workday notices amazing changes (no usual pain, lack of back muscle fatigue, etc.). After a week, this customer will speak about this pillow with his/her colleagues, send them the link to the website, and the new cycles of the new customer journeys will start.
Set up a budget
This is a very individual step for each business. And also very obvious, but for the sake of completeness, we must mention this. You have to take into account all the expenses of your business to see the full picture and figure out where you spend extra and where you can spend more. After listing all the necessary expenses, you can find out that you have some extra finances, which can be spent, for example, on additional promotions or on an upgrade of production capacity, or a good coffee machine for your employees.
In our example startup we can highlight such a list of expenses:
- Rent (shop, store, office)
- Salary for production employees
- Wages for office/store employees
- Costs of raw materials
- Contractors services
- Utility bills (electricity, water, Internet, etc.)
- Office and shop supplies
- Accountant services
- Promotion expenses
And we are sure, we missed something, that will surely appear in the real life.
Create a marketing plan
As we mentioned before, the marketing plan is a plan for promotion activity. And to be honest, the description of all the subtleties of developing the marketing campaigns will make this article twice as long. So, we will devote a separate article to this topic soon. But to be brief, for creating the marketing plan you need to:
- List the platforms for your ads – banners, website, feed ads, Google Ads, etc. Define exactly where you will put your ads.
- How will you create your promotion content, what do need for that? If you have a physical product you require photos and videos, hence you need a camera and maybe a cameraman. To create nice pictures for ads, you need a designer. For launching ad campaigns on social media, you need at least a computer, but better – a targeted advertising manager. And so on and so forth.
- Plan your marketing campaigns. You know your customer. You know what apps and social networks, your customer uses, and what time of the day is the best time. Based on the results of studying the target audience, you need to plan your campaigns in such a way, so that your ad is shown to the maximum number of people from your target group.
- Define strict metrics and KPIs for your ads. Determine specific numbers you need to achieve, in order to accurately determine how well the campaign is going.
Check the performance
Any plan requires control. In the first article of our series, we mentioned a PDCA methodology – “Plan-Do-Check-Act”. It implies the constant tracking and correcting of the strategies. After developing and implementing a full marketing strategy, you need to single out regular performance reviews as a separate activity. Weekly or monthly checkouts can help identify flaws in your strategy and promptly fix them. Soon we will publish a separate article, devoted to the PDCA and performance control, so stay tuned. Also, don’t forget to read the previous parts of our marketing research stages overview, the list is below.
“Marketing research” series:
- Exploratory research
- Study your market
- Competitive analysis
- Define your customer – Create a buyer persona
- Formulate the unique value proposition
- Define communication channels with a potential client
- Define your marketing strategy (you are here now)
- Test your product and strategy
- Implement PDCA methodology