1) List and explain the major components of the marketing plan. 2) Using two different examples, apply the Marketing Concept to non-profit organizations and explain how the application works.
A marketing plan and the marketing concept are disparate terms but terms that are related to each other. The market concept relates to the philosophy of marketing. It says, in the simplest of terms, that a company's goals and the customers' wants and needs are of equal value therefore both must be met when a product or service is presented to the market for consumption. On the one hand, a company must strive to meet the customers' wants and needs while meeting the company's goals. Consequently, the best way to meet a company's goals is to satisfy the wants and needs of the customers.
For-profit organizations are lead by experts in marketing who are well versed in the marketing concept. Nonprofit organizations have historically and are still most often lead by individuals who are experts in the field of endeavor the nonprofit addresses--such as housing development, water and sanitation, medicine and medical supply--but who are not versed in marketing philosophy and the marketing concept. As a result nonprofits have some difficulty with coming to terms with how marketing and altruism come together and form a needed and effective partnership.
Two nonprofits, which have been highly effective in employing marketing philosophy through the marketing concept, operate in the secular market and in the religious market. In the secular market, Mothers Against Drunk Driving (MADD) has set an illustrious example. In the religious nonprofit market, World Vision has a long, successful and effective history of meeting its goals and marketing itself to consumers in both the religious and secular consumer markets.
While World Vision provides many humanitarian services such as wells for drinking water, disaster relief, schools and other educational opportunities, agricultural and medical assistance, their marketing strategy emphasizes the work they do in providing one-on-one sponsorship for individual children in impoverished countries. Their strategy employs advertisements that feature celebrities, like U.S National Team runner Josh Cox, and that feature individual children who have been helped by sponsors or who presently need sponsorship help. The marketing concept applies in that customers' wants and needs are met while the organization's goals are met.
Customer Wants and Needs
The majority of potential sponsors are more motivated by the sight of children whose suffering has been or can be assuaged than by the sight of water gushing from a well. They want to see that their dollars will go directly to children, and they want to see third-party confirmation of the efficacy of the donation and sponsorship program. They need to know that the organization is legitimate, with legitimate goals, and effective.
The organization goal is to raise capital to help individual children live lives that offer future potential and the mitigation of present suffering. In order to accomplish this, large amounts of money are needed. By focusing marketing strategy on the emphasis that meets customer wants and needs (children and legitimacy of the endeavor), World Vision has continually been able, since its founding in 1950, to meet its goals on all levels of endeavor. This illustrates the marketing concept that a company must strive to meet the wants and needs of customers while meeting its own goals, since meeting customer wants and needs is the best way to meet company goals.
A marketing plan, in the simplest terms, is the scheme that defines, then assesses, how monetary resources will be (have been) expended in a competitive marketplace to market the product or service being offered by a company. Marketing plans may be simple and short or expensive, complex and long. They may be for small business or for mid-sized to large companies. The marketing plan for a small business may be different in specifics from a marketing plan for a mid- or large sized company, but all will be the same in essence. The U.S. Small Business Administration offers a paragraph of description of a marketing plan. Market Smarts of New Zealand offers a ten-point outline for a marketing plan. Forbes Magazine, the magazine of the Fortune 500, offers a fifteen-point outline while other sources add a sixteenth and seventeenth point. The ten-point outline for a marketing plan is the one most often taught, so reviewing its components will address the needs of smaller or larger businesses.
Ten-Point Marketing Plan
1. Market Research: gather information about the dynamics and characteristics and competitors of the market the company wants to enter or improve performance in; include controllable and uncontrollable influences on the market. Ask questions like: "What product or service already satisfies this market and which competitors offer similar services?"
2. Target Market: based on your above research, understand how your product or service fits into the existing competitive market, describe the ideal customer to reach and identify a gap in the existing product or service delivered, a gap you can target with your version of a product or service.
3. Product or Service: describe and define what your product or service is exactly how/where it fits into the existing market; this will be derived from your research above.
4. Competition: identify the competition and develop your customized articulation of unique value to the customer, a statement that illustrates how you are different from existing competition.
5. Business Strategy and Statement of Intent: summarize in a few lines to whom you're selling (your target sector from point 2), what you are selling (from point 3), what the distinction is about what you are selling (from point 4); make sure your summary is logical and sound when scrutinized.
6. Marketing and Promotion Strategies: enumerate and describe the marketing strategies and optional promotional strategies (free trial, one-time free offers etc) you will use to market your product or service. Some categories suggested by Market Smarts are:
- Partnering & Networking
- External communication – Advertising, publicity, promotions, sales collateral, online media
- Internal communication – staff and partners
- Training programmes
7. Pricing, Positioning and Branding: choose a pricing strategy for pricing your product or service and determine its value position in the existing market [lower value (a Jaclyn Smith dress at K-Mart), mid-value (a dress from Macy's), high value (a Vera Wang dress)] while determining a strategy for achieving brand recognition (customers know and trust your brand rather than just your single product).
8. Budget: a critical step in which you align strategies with budget; funds must be available to implement the strategies chosen and must be accordingly allocated to each strategy to adequately fund it.
9. Marketing Goals: marketing goals are converted to measurable numeric goals such as increase brand exposure by 10 percent by the fourth quarter; quantifiable goals allow for authentic measurement and assessment of success.
10. Monitor and Assess Results: measure, test and analyze assessments of goals while acquiring customer feedback. Market Smarts suggests some ways of gaining feedback, especially good for Internet based e-commerce:
- Online polls
- Database management tools