Marketing Banking University Project

Marketing Banking: Identifying the Insightful Marketing Mix in Banking

Marketing banking services has assumed a new dimension as new ideas and innovations continues to drive the competition. Today, marketing has occupied a prime place in the business of banks and different services and products are being created and directed towards meeting the needs of the customer. While the traditional methods of marketing banking remain effective, there is the need for banks to apply more insightful marketing mix in marketing financial products and services. This paper identifies email marketing, rather than social media networking, as a very effective means of marketing to the Gen Y among other insightful approaches to marketing banking nowadays.

Introduction

The evolution of marketing banking started in the West in the late 1950’s (Muraleedharan, 14). Prior to this period, marketing was alien to banks. At the early stage of its emergence in the banking industry, marketing banking was mainly practiced in the form of advertising and promotional strategies. It was not until the 1970’s before marketing was fully grafted into the banking industry as an integral part of managing banking business.

Effective marketing of banking services is important particularly during a period when banks are confronted with tough competition from other local and foreign banking and non-banking financial agencies that offer value added services to their customers. Competition in the financial service industry is not limited to resource mobilization and lending to customers; it extends to the core areas of revenue generation services offered by banks and which also form the core aspect of banking. The cumulative effects of stiff competition in business and the continual change in the banking operational environment, engendered by the process of economic reforms, has made marketing of banking services imperative for all categories of banks in the private and public sectors of the economy.

Marketing banking services has assumed a new dimension as new ideas and innovations continues to drive the competition. Today, marketing has occupied a prime place in the business of banks as different services and products are being created and directed towards meeting the needs of the customer.

What is Marketing Banking?

Hartley (Jha, 49) referred to marketing banking simply as ‘’responsive marketing’’ suggesting that it is an attempt at responding to the changing needs of the customer, the society and the environment. Kuppuswami defined marketing banking as ‘’the creation and delivery of financial services suitable to meet the needs of the customer at a profit to the bank’’(Kuppuswami, 20). Kuppuswami’s definition shows that marketing banking aims at satisfying the need of the customer with an underlying intention for making profit. Deryk Meyer, a former United Kingdom Chairman of the Barclays Bank, defined Marketing banking as ‘’consisting of the process of identifying the most profitable markets now and in future, setting business development goals, making plans to meet the goals and managing or promoting the various services to achieve the set plans in a rapidly changing market environment’’ (Muraleedharan, 27).

Marketing Banking Dissertation
Marketing Banking Dissertation

Deryk Meyer’s definition has been considered as comprehensive because it highlights a process of marketing bank services consisting of the following three layers:

  1. Identifying the present and future markets that offer the most profit margins.
  2. Assessing the present and the future needs of the customers.
  3. Setting aims and objectives, managing and developing banking products and services that satisfies and meets the needs of customers in a changing market environment.

Brent (1995, 45-54) and Holmlund & Kock (1996, 287-297) identified the ability of banks to implement marketing strategies based on the needs and preferences of customers as a key factor for successful marketing banking.

Marketing banking goes beyond selling bank products and services to existing and prospective bank customers. Effective marketing of banking products and services includes creating a strong and worthy brand image of a bank on the mind of its customers. The present day bank customers are looking for a bank which can meet all their present and future needs, therefore, understanding the key elements that makes marketing banking effective is crucial to the successful implementation of marketing orientation in banking because banks now operate in a buyer’s market.

How to Identify the Needs of Bank Customers

Market Segmentation and its Importance

Marketing banking has two key elements which are: an understanding of the needs of the customer and the willingness to satisfy the identified needs. It involves learning what a customer takes into consideration when making choices from specific banking products and services. Existing and potential bank customers are increasingly becoming quality conscious clients and since no two groups of customers are the same, there is the need to do market segmentation of bank customers within each branch or geographical area in a bid to identify the needs of each group of customers.

Meaning of Market Segmentation in Banking

Market segmentation is a common marketing practice where a larger target market is broken down into smaller market segments for efficient and effective marketing. Alan Roberts refers to marketing segmentation as a means of conquering a larger market by dividing it into smaller segments. The classification of banking products and benefits is often the best way of defining bank market segments where many products are available on offer to customers.

The parameters for the segmentation of bank customers include the use of one or a combination of two or more of the following: geographical location, demographics, volume of transactions, psychographic or personality traits, and benefits (Rajeev, 119).

Geographic Market Segmentation

In the context of banking, geographic segmentation may be done on the basis of different variations like north, south, east and west or on the basis of population like town, small city and large city or it could be done simply by classifying the market into rural, urban and metropolitan. Geographic segmentation appears to be the easiest form of market segmentation as each segment has a well-defined demarcation.

Demographic Market Segmentation

Usually, demographic parameters include sex, age, income, occupation, education and social class among others. Literature is replete with the suggestion that extending geographic segmentation to include demographics may produce banking market segments with more homogenous characteristics than either of the two taken on individual basis (Muraleedharan, 31).

Psychographic Benefit Segmentation

Psychographic benefits such as parameters that portray personality traits are another set of useful criteria for segmenting banking market. However, psychographic benefit parameters are rather sophisticated and their effective use for market segmentation requires a deep understanding of the psychology of the customer. Examples of psychographic benefit traits are leader-follower traits, conservative-liberal traits, and introvert-extrovert traits. However, the extent to which psychographic traits could help in segmenting bank customers based on needs and behavior remain rather uncertain and it is, therefore, difficult to implement in bank market segmentation.

Product Benefit Segmentation

Product benefits as a tool for segmenting bank customers refer to the use of parameters like status, economy and convenience. A bank customer who longs for a bank loan is looking to enjoy the benefit of better economy and another customer who craves for prompt and efficient bank service is looking to enjoy the benefit of convenience and would be willing to pay a price for convenience. The most common banking benefit segments are categorized as follows:

Standard Banking Benefits

Standard checking and savings banking products form one of the largest segments of banking benefits commonly offered by banks. Though banks usually market checking and savings accounts separately, yet many banks now attempt to create a bonding relationship with their regular customers by introducing banking packages that gives additional value to customers when they add savings accounts to their checking accounts. Often, the incentives used by banks include offering higher interest rates on savings deposits and seamless transfer of funds from checking to savings accounts and vice-versa. Marketing of this category of banking benefits to target customers could be done through electronic and print media like television, radio, newspapers and magazines.

High-end Special Savings Benefit

The special savings benefit segment is a step ahead of the standard banking benefit for checking and savings customers. High-end special bank savings may include high interest rate savings accounts, money market, certificates of deposits and other packages that give great dollar value to customers. It is easy to market this category of benefit segment to existing customers already running standard checking and savings accounts but the product can be marketed through the media.

Bank Loans

Bank loans form a huge segment of banking benefits which most banks offer their customers as part of banking operations and a strategy for marketing banking. Typical examples of bank loans include home and auto loans which often form a significant part of bank loan portfolio. Other available banking loans are student loans, equity loans and personal loans. Marketing bank loans are usually done separately from marketing of other banking products. Home loans are better marketed through real estate resources or media-like publications and auto loans would reach the right target customers if marketed in auto publications. Banks can also cross promote consumer banking loans by marketing to existing customers at attractive rates or as part of a package with other products.

Investment Benefit

The investment benefit segment of banking operation is fast becoming popular among traditional banks. Bank customers who have been managing their stock, bond and other niche investments on their own through separate bank accounts could be targeted for this product. Banks can also market investment benefits to existing customers together with attractive benefits. Banks could also market investment solutions through investment related media and investment publications.

It is expected that customers within the same classification or segment would show similarity or homogeneity in their banking needs. However, each segment should be tested for validity using measurability, accessibility and profitability as measuring tools before any group is accepted as a segment.

The factors that influence a customer’s choice of bank products are both internal and external factors. The internal factors include needs, attitudes, motives and perceptions while the external factors include influence of culture, economics, business, family and the influence of social group.

Household Segment versus Corporate Segment

In most markets, market segments within the banking industry could be classified as either household or corporate segments. The degree of bank marketing efforts required in each case differ because the two major segments have characteristics which are distinct and opposite to each other. Marketing banking to the household segment requires the application of consumer marketing principles while the principles of industrial marketing has been considered by experts as the most appropriate technique for marketing banking to the corporate market segment. Some of the recognized and leading household marketing banking segments are students, senior citizens, housewives, working women, young working men, working women and defence personnel among others.

Benefits of Market Segmentation to the Banking Industry

Market segmentation of bank customers has its distinctive advantages. It helps a bank to differentiate customers with dissimilar needs from those with similar needs. Market segmentation of bank customers provides a solid foundation for building enduring bank marketing strategies. Market segmentation also helps banks to create special marketing packages for each group of customers based on their distinctive needs. In turn, bank customers could easily create the mental feelings that specific bank products have been specially designed for them. Such psychological feelings will improve customer satisfaction and also make the work of the bank marketer easier. The overall positive effect of proper segmentation of bank customers is bound to gain a higher return for every dollar spent on marketing banking services.

The Importance of Marketing Banking

Banking is a service industry and bank customers have become sophisticated. Technological advancement has produced more sophisticated consumer tastes. Bank customers now expect that their bank will offer them quality services and products tailored to meet their specific needs. Financial needs of bank customers have become rather complex because of the global modern trend. Bank customers now compare products and services offered by both local and foreign financial agencies and demand improved quality services with variety or a range of choices. Nowadays, customers of banks want access to instant cash, appropriate financial advice; Internet based banking services, deferred payments, asset security, reduced interest rates, personalized services and financial products with flexible terms among others. Identifying the needs of the existing and potential bank customers and providing quality financial products and services that match their demands is the key strategy of marketing banking. Marketing banking creates awareness of banking products and services among customers and it helps banks to focus on offering quality products and services as a key factor towards running a successful banking venture in a competitive world.

The stiff competition the banking industry face nowadays cannot be overemphasized. In a recent report published on May 7, 2012, Grind Kirsten analysed the new banking services which brokerage and mutual-fund firms have been rolling out to excite existing customers and also grab a lot of the new customers who are already getting frustrated with the sloppy services of the big banks. Experts suggest that some of the new incentives might worth a look because the new offerings seem to be paying off for the firms. The brokerage and mutual-funds firms have started to record increases in the number of accounts opened and the deposits made by their customers ostensibly influenced by the thoughtful offerings and incentives offered.

TD Ameritrade, a brokerage firm is now offering online bill pay, ATM rebates, free checking accounts and increased return on savings accounts which now pays 1.25 percent per annum to their brokerage customers. Also, Charles Schwab Corporation is offering all their existing brokerage and prospective customers free checking accounts and a lot more incentives like reimbursed ATM fees.

In Fidelity Investments, the new offerings being made to their customers seems to be yielding good results as the brokerage firm saw an increase of 40 percent in their Fidelity Cash Management Accounts in 2011. The Fidelity Cash Management Accounts don’t pay a fee on checking and there is no minimum balance restriction. Fidelity Investments rewards customers for higher deposit levels with such incentives as free trades, Apple gift cards and airline tickets. Charles Schwab recorded a $61 billion increase in bank deposits last year which translates to a 20 percent increase in deposits according to the report. Overall, the report says the deposits of 10 US banks run by brokerage firms increased by 16 percent in 2011 to $263 billion.

In comparison to traditional banks, financial advisers say that some offerings by brokerage firms stack up well which is why marketing banking is a very important concept to the present day banking industry.

Approaches to Marketing Banking

The banking industry has approached marketing banking in various ways over the decades using a combination of such methods as:

  1. Identifying and analyzing the needs and wants of existing and potential customers.
  2. Crafting banking products and services to match the needs and wants of customers
  3. Setting appropriate pricing for banking products and services
  4. Using appropriate advertising channels to promote products and services to the existing and prospective customers

‘’Top to Bottom’’ Approach to Marketing Banking

There have been many traditional approaches to marketing banking products or services over the decades. One of the traditional methods is the ‘’top to bottom’’ technique. Banks have generally been occupied with the development and release of various banking products and services on the basis of ‘’top to bottom’’ approach. The ‘’top to bottom’’ approach of marketing banking is a scenario where the headquarters of a bank designs and develop banking products and services solely and then trade these products through their retail outlets, which are often called branches, to the different segments of their teeming customers.

While this approach could have been effective at some points, the present challenges of bank management requires a shift from this traditional approach and focus on developing banking products from the grassroots level up to the top. The ‘’bottom to top’’ approach promises to help banks design and develop products and services that suits the needs of the different homogenous segments of bank customers.

Besides the traditional approaches to marketing banking, experts have proffered new strategies and ideas to facilitate marketing success in the banking industry. Jim Marous, a marketing services expert recently tweeted ‘’50%+ of bank customers aren’t on banks email lists. Need multi-channel integration.’’ In response to Jim Marous, Bob William, a Director of Marketing Technologies at Harland Clark and author of the blog ‘’The Merchant Stand’’ wrote a guest article on Jim’s blog, ‘’Bank Marketing Strategy,’’ and suggests the need for banks to collect more insights and use mobile device applications to improve proactive multi-channel communications and integration with their customers. Banks are simply not using the mobile channel for effective communication with their clients according to Bob’s article ‘’Banks Need to Collect Insights to Communicate Effectively.’’

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Neal Reynolds, a bank marketing and advertising strategist, suggests that banks should offer more than the traditional banking services if they elect to succeed in banking. Neal says banks need to ‘’become the go-to place before anyone invests in anything.’’ Maybe banks need to offer their customers insights on how to invest in stocks, real estate and even how to choose insurance packages and retirement plans. In addition, Neal suggests that banks should embrace the Internet more and offer internet related banking services; remote capture and online bill pay services as creative means of attracting new prospects and keeping their existing customers.

In analysing the strategy for marketing banking to the Millennials, that is, the Gen Y population group or the Internet Generation in the USA, Damian Davila, in his article ‘’How to Market Banking to Gen Y’’ published in July 2010, says that email is the one and only effective means of marketing banking to the Gen Y in this contemporary times rather than online social networking sites – Davila reached this conclusion after analyzing a series of data on Gen Y. People within the Gen Y led the pack of online banking customers with 80 percent and it is reported that they are comfortable performing financial transactions of various types on the Internet.

Martha Bush, the SVP of Strategy & Solutions at SIGMA Marketing Group, suggested the following key strategies bank marketers can use to improve bank marketing experience:

  1. Identify the behavior triggers of your customers that show their readiness to buy new banking products by setting powerful predictive software models to run against your customers’ database or files. This is a good strategy for monitoring customer growth initiatives and it is a novel approach for cross-sell and up-sell bank marketing techniques. Bank marketers can identify the real time to sell specific products or simply suggest the use of new banking services to the customer through this marketing strategy.
  2. Use hunt-and-peck method of marketing to consistently find high net worth persons looking for new banking experience.
  3. Reduce the rate of customer attrition while working to build stronger relationships by spotting the early warning signs of customer dissatisfaction. The point at which each customer becomes dissatisfied can be known early and you will have the best chances to apply retention strategies if powerful predictive models and automated messaging techniques are used.
  4. Use timely and relevant communications to improve customer satisfaction. Bank customers now expect real-time exciting relationships with their bank everyday.
  5. Effective communications requires that the bank marketer has in-depth insights of the customer each moment of interaction. Customer insights should include banking behaviour and lifestyle so that the bank marketer will be able to deliberately create smart interactions with the customer while adding value at the same time.

Conclusion

Effective marketing of bank services and products increasingly requires creative strategies if banks hopes to continue to successfully compete with other financial agencies in the market place. Though marketing banking has now occupied a prime place in the business of banks yet banks need to continue to develop different services and products and direct the variety towards meeting the needs of the customer. Considering that there is a great shift in the way banks succeeded in the past compared to the prevailing new competition, banks will have to continue to develop insightful ideas and strategies to retain existing customers and attract new clients.

Banks needs to lay less emphasize on location but concentrate more on delivering quality services through the Internet and endeavor to create a bond with their valued customers by using varied and proven marketing strategies together with mobile device applications more proactively. Also, it is imperative that bank marketers will have to incorporate powerful models and analytics into managing their customers’ database to improve predictions of customer behavior.

References

Brent, K (1995). Relationship Banking and Competitive Advantage: Evidence from U.S. and Germany. California Management Review 37, 45-64.

Bush, Martha. Five Engagement Strategies for Bank Marketers in 2015

Davila, Damian. How to Market Banking to Gen Y, 2012

Grind, Kirsten. Funds Firms Challenge Banks, 2012

Holmlund, M and Kock. S (1996). Relationship Marketing: The Importance of Customer-Perceived Quality in Retail Banking. The Service Industries Journal 16, 287-297.

Jha, S.M. Service hdarketing, Himalaya Publishing House, Mumbai, 2000. p.49.

Ksajitha. Marketing of Banking Services.

Kuppuaswami, S. The Banker November 1986, p. 22.

Marous, Jim. Bank Marketing Strategy, 2012. Web

Muraleedharan, K.K. Marketing Strategies of the Banking Industry, 2010.

Rajeev K. Seth. Marketing of Banking Services, Macmillan India Ltd. Neu Delhi, 1997. p.119.

Reynolds, Neal. Sticks and Bricks or in the Clouds: Bank Marketing Strategies + Ideas, 2012

William, Bob. Banks Needs to Collect Insights to Communicate Effectively. Bank Marketing Strategy, 2012

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Marketing Plan Essay

Marketing Plan

In this essay the discussion focuses mainly on the importance of a marketing plan and the role it plays for the development of businesses. In due course the nature of a marketing plan and the key elements of it are also discussed. Whether the elements of a marketing plan are linked or independent? This key issue is discussed elaborately explaining the links between different elements of the marketing plan. A marketing plan is different from a business plan and these differences are also highlighted in this essay. The essay would not be considered complete if the misconceptions about a marketing plan are not discussed. There are some misconceptions prevailing about marketing plan and they are discussed briefly in the essay. The essay has been concluded with a brief summary of the discussion made here.

Role and nature of marketing plan

Before discussing role and nature of a marketing plan it is important to understand what is marketing. Marketing is a function of an organization which involves several processes of creation, communication and delivery of value to customers and management of customer relationship in such a order that the organization as well as its stakeholders are benefitted. In other words, it is a process to identify, anticipate and satisfy customer with profit. It is science and art to create change in the market for the benefit of the organization. Understanding the need and want of the market and to earn profit is called marketing. Marketing is done with a strategic plan (Hatch & Schulz, 2003).

A marketing plan is a written document describing the external and internal business environment, aims and objectives of the organization, its strategy, plan of action and control. Marketing plans for different companies vary according to the requirements and the strategy of the company. Occasionally some companies have only one plan and they call it a business plan but a business plan includes plans of all the functions performed by a company like Research & Development, Production, Financial Management, Human Resource Management, IT as well as Marketing. Hence, a marketing plan is only a part of a business plan (Einwiller & Will, 2002).

 A marketing plan is built on the strengths of an organization to exploit it for the maximum benefit of the organization. An integrated and well coordinated marketing plan makes an organization proactive and not reactive. It successfully communicates the purposes and the intent of the senior management. It sets the objectives for actions and it is target oriented. A written plan provides the scope for adjustments (if needed) and monitoring of marketing activities. Besides these reasons marketing plans are used for understanding the needs and wants of the customers for their satisfaction. Customer satisfaction is the prime objective of any marketing plan and that can be measured by meeting their needs and wants efficiently. Needs and wants change with time. Hence, a satisfied customer may be dissatisfied tomorrow with the change in need and want. This makes marketing a rigorous and continuous process. (Ferrel and Hartline, 2005). A marketing plan is based on the information and data from various sources and lack of reliable data is one of the biggest difficulty in making a marketing plan. Complete firm’s picture, product line, present and future of the situation, internal and external environment and customer satisfaction are the key features of a marketing plan. Structure of a marketing plan vary from company to company. (Mathewson, 2009).  Generally a marketing plan is structured in the following manner:

Executive Summary

Challenges

Situation Analysis

  • Customer Analysis
    • Concentration of customer base for particular products
    • Decision Process
    • Value Drivers
    • Type
    • Numbers
    • Company Analysis
      • Focus
      • Strengths
      • Weaknesses
      • Market Share
      • Goal
      • Culture
      • Climate
        • Economic Environment
        • Technological Environment
        • Political and Legal Environment
        • Social and Cultural Environment
        • Collaborators
        • SWOT Analysis

Following environmental factors are needed to be organized for the SWOT analysis of a business environment

  • Strengths and weaknesses of the organization should be considered as internal attributes or internal environment
  • Opportunities and Threats are to be considered as external attribute or external environment
  • Competitor Analysis
    • Market Share
    • Market Position
    • Strengths
    • Weaknesses

Market Segmentation

  • Segment 1
    • Description
    • Sales percentage
    • Wants of the customer
    • Way of using the product
    • Support
    • Way of reaching them
    • Price
    • Segment 2
      • Abc
      • Abc
      • Abc

Alternative marketing strategies

Selected marketing strategy

Product

  • Brand
  • Quality
  • Scope
  • Warranty
  • Packaging

Price

  • Price list
  • Discounts
  • Terms of payments
  • Financial options
  • Options for lease

Distribution (Place)

  • Channels for distribution as intermediaries, distributors, retail and direct
  • Motivation of channels
  • Evaluation of channels
  • Locations
  • Logistics as supply, transportation, warehousing, etc.

Promotion

  • Promotional programs
  • Public relation
  • Advertisement
  • Budgeting
  • Estimating results of promotions
Marketing Plan Dissertations
Marketing Plan Dissertations

Long term and short term projections

Conclusion

Appendix

Exhibits

Recommended reading

In some cases the structure of the marketing plan of a company is not as detailed and extensively elaborated as above and it is short and simple but focused. It depends on the size and the need of a company. Even a simple marketing plan should be structured as follows:

Summary of Strategic Situation

Objectives and Targets

Positioning      

Budget

Sales projections

Strategy for product

Strategy for price

Strategy for distribution

Strategy for communications

Market research

Conclusion

A marketing plan is used to serve the end result of building a customer base and creating an environment which could lead a company to success. It serves other functions as well such as a marketing plan is used for introduction of a new product into market, for exploring new markets for a product, for setting up gals and targets and achieving it and for establishing, directing and coordinating between sales and marketing efforts of a company. The potential differences between different structures of marketing plans depend on the nature of the business of the company and their requirements. The end results are same for all the marketing plans.

Elements of marketing plan and links between them

The key elements of a marketing plan are Executive Summary, Challenges, Situation Analysis, Market Segmentation, Alternative marketing strategies, Selected marketing strategy, Product, Price, Distribution (Place), Promotion and Long term and short term projections. These elements are interdependent and complementary to each other.

Executive summary is the brief overview of the content of a marketing plan. It describes the objectives of the plan. It has the description of the strategies of the company for marketing, Before discussing the plan and the strategies for marketing in detail the marketing managers prefer to discuss the challenges which may come across in marketing or the challenges of the market for the company. The business world is changing very fast and the growing competition in the business world is reducing the margins of the businesses and extensive marketing is required to meet this challenge which is again very expensive. Challenges can only be tackled in favorable situation which further requires situation analysis (Hatch & Schulz, 2003).

Situation analysis is done to understand various situations or it can be said that situation analysis is of several types like customer analysis, company analysis and climate analysis. Customer analysis involves factors like number of existing customers and expected number of new customers, types of customers, decision process of customers, value drivers for customers and finally the concentration of customer base for particular products (Einwiller & Will, 2002). The end result of a marketing plan is satisfaction of customer and customer analysis is a very important. Analysis of company means study of strengths and weaknesses of the company, the market share of a company for a particular product, the culture of the company because the output of a company also depends on its culture, the goal of the company and the focus the company has to achieve that goal. Then comes climate which means environment of different types like economic environment, political and legal environment, social and cultural environment and technological environment. In some marketing plans they are also analyzed as external and internal environment (Ferrel and Hartline, 2005).

Collaborators are also called as stakeholders by marketing managers. Stakeholders may have stakes in the company in different ways that is why there are different types of stakeholders. Stakeholders range from customer to the top management of the company which includes workers, employees, suppliers and many others and a good marketing plan must not overlook their stakes. The company keeps the required data about its stakeholders for various purposes including making a marketing plan (Mathewson, 2009).

SWOT analysis means study of strengths and weaknesses as well as study of opportunities and threats. A good marketing plan must analyze the strengths and weaknesses of the company, product as well as customers. Similarly it should analyze the opportunities for the company, product and the opportunity of the market. Opportunities never come without threats and it will be mistake if the threats are not analyzed in a marketing plan. For SWOT analysis information are needed to be collected from both the internal sources of the company and from the market (Freeman, 1984).

There is hardly any business without competitor and the success of a marketing plan substantially depends on the proper analysis of the competitors. Marketing managers must know the position of the competitor in the market, the market share of competitor for a particular product or different products and strengths and weaknesses of the competitor.

Marketing mangers divide the market into different segments and the process is called market segmentation. Needs and wants of all the markets are not same and the market managers have to analyze which segment of the market is useful for a particular product. The factors needed to be kept in mind for market segmentation are the percentage of sales in that segment, description of the segment, what do the customer need or want, how do they use the product, how to reach them, whether the price is suitable for them, etc. They need to collect the information from the external sources. (Mullins, Walker, Boyd and Larreche, 2005)

Every plan should have an alternative plan which can be used if needed. Efficient and experienced marketing managers always ready with an alternative marketing plan. The plan which they execute is called selected plan. Marketing plans have detailed description of the factors like product, price, promotion, distribution, etc (Mullins, Walker, Boyd and Larreche, 2005).

Product is the key factor of the marketing plan and it revolves around it. Ultimately product is the tool through which the company reaches to customers and wishes to satisfy them meeting their needs and wants. It is the responsibility of the marketing manager to ensure branding f the product and to analyze the quality of the product and the scope for it in the market, Proper packaging of the product with genuine warranty adds value to it. After all it is the product only which decides the success and failure of a company.

Price is another key factor and it should be relevant to the market, customer and the competitor. Customers always prefer quality product at affordable price. The marketing managers offer some options for the market to make the offers attractive. They offer discounts, different payment options, financial support and sometimes options for lease. All these information should be provided clearly in the pricelist (Jones, 2005).

Distribution ensures the success of a product and alternatively of a company. All these efforts of marketing will go waste if an adequate system of distribution is not set up. Distribution of products is done by various methods like making channels for distribution such as distributing through intermediaries, distributors, retail or direct. These network need to be evaluated regularly for its proper functioning and the stakeholders associated with the distribution network must be kept motivated. The selection of location for the network should be done carefully and proper care of regular supply, transportation and warehousing must be taken (Dickson, 1996).

Last but not the least another key factor of marketing is promotion and promotion is done by following promotional programs, making public relation, advertisement, budgeting and finally estimating the results of promotion.

Some elements of a marketing plan are interlinked while others are independent. For example, challenges can be estimated by understanding the situation and pricing can be done by valuing the product and the promotion of the product is done (Freeman, 1984).

Assumptions

There are many misconceptions about marketing plan. The most common misconception of customers is that they generally think that the companies make marketing plans to manipulate things and the aim is to deceive. In fact, a marketing plan is made to ensure satisfaction to customers. The aim of a marketing plan is to reach to the customer to satisfy his needs at the affordable price. The advertisement sometimes becomes illusionary and creates confusion (Jones, 2005).

The most common misconception of companies is that a marketing plan and its implementation is an expensive and difficult to measure process to evaluate the return on investment on it. Actually a perfect marketing plan ensures tangible return on it. A marketing plan is made by marketing manager after extensive research and it is aimed to ensure success and earn profitability for the organization. Companies think that investment in marketing plan can be made only if the cash flow allows for it. In fact, marketing plan is the factor which ensures the cash flow and projects in advance the rate of cash flow if planned and implemented efficiently (Dickson, 1996).

Conclusion

A marketing plan is a key to success for any business but unfortunately many businesses confuse marketing plans with investment on advertisements with no assured returns. A marketing plan is a simple act of bringing products and services to market and providing right message to right person at right time. Actually marketing plan can only assure the success of a business by guiding businesses to follow the processes required for its success. Those processes include how to analyze marketing environment, how to decide marketing segment, how to choose the marketing mix. Marketing mix includes five important Ps of a marketing plan. They are Product, Price, Promotion, Place and Process.

References

Hatch  M. J. & Schulz, M. 2003. Bringing the corporation into corporate branding. European Journal of Marketing, Vol 37(7/8), pp; 1041-64.

Einwiller, S. & Will, M. 2002. Towards an integrated approach to corporate branding – an empirical study. Corporate Communications, Vol 7(2), pp; 100-9.

Ferrel, O. and Hartline, M. 2005. Marketing Strategy, 3rd Edt.Thomson

Mathewson R. 2009. Misconceptions about Marketing, Maple Marketing

Dickson, P.R. 1996. The static and dynamic mechanics of competition: a comment on Hunt and Morgan’s comparative advantage theory. Journal of Marketing | October 1, pp; 102  –

Freeman, R. 1984.  Strategic Management: a stakeholder approach, Boston

Jones, R. 2005. Finding sources of brand value: Developing a stakeholder model of brand equity. Journal of Brand Management, Vol 13(1), pp; 43-63.

Mullins,J., Walker Jr, O., Boyd Jr, H. and Larreche, J. 2005. Marketing Management: A Decision-Making Approach, 5th Edt, McGraw-Hill / Irwuin, Sydney

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