Maryknoll School of Lupon, Inc.

Kambing Baratua St., Lupon, Davao Oriental

Learning Module in Entrepreneurship

Week 5&6

Name: _______________________________
Grade and Section:______________________
Teacher: Ms. Allyza Marie S. Briz
 Content:
Development of Business Plan

Contents Standard:
The learner demonstrates understanding of concepts, underlying principles, and
processes of developing a business plan.

Performance Standard:
The learner independently presents an acceptable detailed business plan.

Formation Standard:
The learner can create marketing strategies.

Transfer Goal:
The learner will be able to apply marketing mix in the development of marketing
strategy.

Learning Competency:
The learners describe the Marketing Mix in relation to the business opportunity.

MODULE 3: The Marketing Plan

At the end of this module, the students can:

1. Describe unique selling proposition and value proposition that differentiates one’s
product/service from existing products/services.
2. Determine who the customers are in terms of target market.
3. Describe the marketing mix (7Ps) in relation to the business opportunity and vice
versa.
4. Develop a brand name.

After the comprehensive processes of seeking, screening and seizing the

opportunity, it is now time for the entrepreneur to focus on the chosen business and dig
dip. The entrepreneur must write a business plan. A business plan is a comprehensive
paper that details the analysis, objectives, strategies and tactics, and how to control and
monitor the business.

This module will help the student understand and identify what makes a product
or service stand out from the competitors.
LESSON 1. Value Proposition

Marketing is all about knowing the customers. Therefore, the marketing process
starts with identifying the customers’ needs where you are tasked to create a meaning
full value proposition.

A value proposition (VP) simply states why a customer should buy a certain
product or service. Thus, the VP is the major driver in customer purchase or service
availment. The start up entrepreneur will surely have a hard time in thinking a value
proposition for his or her business. He or she should bear in mind that a VP has to be
direct in addressing the problems of the customers, should have quantifiable benefits,
and should differentiate itself from the competitors.

The following are some tips for the entrepreneur on how to create an effective
value proposition to the target customers:

1. Prepare a situation analysis that details the problem(s) of the customers.

2. Make your VP straight to the point., simple, and specific; in short, there should be
no complications.
3. Highlight the value of the product or service so that the customers will easily get
what benefits you can provide..
4. Adopt the language of your market.
5. Add credibility-enhancing elements.

To illustrate , here is a sample potential value proposition from the most common
small businesses in the Philippines.

Aling Tere’s Sari-Sari Store

Situation analysis:
Prior to the establishment of a sari-sari store, Aling Tere notices that there is s
convenience store in her vicinity, where many call center agents, nurses and
construction workers buy food, beverages, and other products during odd hours (from
10pm to 6am). She discovers that the customers either ride s tricycle or jeepney just to
reach the convenience store. There are two sari-sari store nearby, but they close at
9pm. Aling Tere believes that this is an opportunity for a sari-sari store business with a
twist. Aling Tere realizes that she needs to address the needs of the customers to
differentiate her business from competition. She decides to establish a 24/7 sari-sari
store. Aling Tere hires three employees who will help her run the sari-sari store in three
shifts. During their break , Aling Tere mans the sari-sari store herself. She designs her
sari-sari store like a semi-convinience store, where customers can freely go and choose
the product they want. It is also air-conditioned. For security purposes, she also installs
CCTV camera. Her task now is to craft a worthwile value proposition for the potential
customers.
Proposed value proposition: “tindahang maasahan, bukas kahit anong oras!”
LESSON 2. Primary and Secondary Target Market

Entrepreneurs must focus only on customers whom they can serve beneficially
because they will be wasting resources if they target all. They can tap primary and
secondary target market as resources are limited during the start-up stage. With this,
probability of success is higher as the entrepreneur can focus to sell to the identified
customer groups.

Market segmentation is the process of grouping similar or homogeneous

customers according to demographic, psychographic, geographic (location), and
behavior. It is a necessary activity in marketing because it gives the entrepreneur a
holistic and general view of the market group that he or she is serving.

It is best to create a persona(s) of the target customer to represent the general

characteristics and behavior of target market. Secondary target market are the
customers who don’t have enough purchasing power or have fewer demands. They
may not be your target market, but they can be converted pnce effective marketing
strategies are implemented.

DEMOGRAPHIC SEGMENTATION (SOCIOECONOMIC SEGMENTATION)

-is the process of grouping customers according to relevant socioeconomic variables for
the business.

SOCIOECONOMIC VARIABLES:

 Income range and social class

 Occupation
 Gender and age
 Religion
 Ethnicity
INCOME RANGE AND SOCIAL CLASS

-it represents the purchasing power of the market.

Class Percentage of Family Earnings

D 60% P191,000

E 30% P62,000

C 9% P603,000

AB 1% P1,857,000

OCCUPATION
-it should also be considered not just to determine the customers’ income but also their
daily routine where goods and services can be properly positioned.

Example:
Call center agents
Teachers
Night shift nurses
GENDER AND AGE

-are data that must be mind because of the lifecycle of customers and their gender
influence their buying behavior.

Sex and Age group Potential Product or Service Demand

Male teenagers (13-19) Products: Rubber shoes, sport apparel

and chips.
Services: cool hangout places, gyms and
barber shops.
Single females (20-30) Products: bags clothes,makeup
Services: spa, beauty clinics and salons.

RELIGION AND ETHNICITY

-should be taken to account because these affect the way they buy products or avail
services.

Examples:
Food choices
Events
Holidays

PSYCHOGRAPHIC SEGMENTATION
 Psychographic segmentation is a process of grouping customers according to
their perception, way of life, motivation and inclination.

Perception- is a process wherein an individual receives external stimuli using the five
senses of hearing, touching, smelling, seeing and tasting.

Customer’s way of life- Will give an entrepreneur an overview of what products or

services can best suit the problems of the customers that happening on daily basis.

Person’s Motivation- Can be either physiological or psychological

Physiological motivations- involve the needs of the person. They seek to avoid pain and
give pleasures.

(e.g., food, clothing, shelter)

Psychological motivations- involves customer’s preferences.

(likes and wants)

Motivations are also affected by their aspirations and deprivations.

Customer’s Inclination - involve preferring one product over another as a result of

gaining a refreshing experience when using the product, possibly due to the product’s
unique features or due to it giving more value than other products.

GEOGRAPHIC SEGMENTATION

Geographic segmentation Is simply grouping customers according to their location.

It encompasses the cultures, beliefs, preferences, politics and lifestyle of a certain
geography.

Example:

Meat products such as pork can easily be sold in REGION 3 and REGION 4. But it will
be difficult to sell in the Autonomous Region in Muslim Mindanao (ARMM) and REGION
12 or SOCCKSARGEN.

BEHAVIORAL SEGMENTATION
 Behavioral segmentation is the process of grouping the customers according to
their actions. These behaviors are instigated by occasions, desired benefits, loyalty, and
usage of products or availment of services.

Examples:

Wash,dry and press services for busy office workers in the city because they don’t have
time to do this chore.

Offering 3-in-1 coffee for budget conscious customers and those who prefer instant
coffee.

LESSON 3. The Interview

It is one of the most reliable and credible ways of getting relevant information from
the target customers.

Two main types of Interview:

Unstructured Interview- is an informal type of interview and does not follow a specific
set of questions.

- Checklist of high-level questions.

- produce “qualitative data”

Structured Interview- employs a specific set of questions.

- Produce “quantitative data”

LESSON 4. The Marketing Mix: The Marketing 7Ps of

 The marketing mix is a widely accepted strategic marketing tool that combines the
original 4Ps (product, place, price, and promotion) with the additional 3Ps--- people,
packaging, and positioning.

Entrepreneurs must use the 7Ps model to do the following: conduct situation
analysis; set objectives; conduct a SWOT analysis (discussed in module 2); and
ultimately come up with marketing strategies and tactics.

A challenge to an entrepreneur is to ask the following questions at the onset:

 Product – what product or service is the most appropriate for the opportunity, and
why will customers buy or avail them?
 Place – what location is best suited for the business where there are more
potential customers. Can they conveniently transact on-site or online? How is the
process of distribution of products or performance of services?
 Price – what is the most appropriate price, and what pricing strategies will be
used for the target customers?
 Promotion – what is the most effective advertisement or combination of
advertisement, and which advertising tool should be used to drive awareness
and increase sales?
 People – what type of people need to be hired? What are the basic skills needed
for the job? What leadership style will be applied by the entrepreneur?
 Packaging – what is the best packaging for the product that is attractive enough
to customers and cost-efficient at the same time? What physical evidence does
the entrepreneur need to set up so as to sell the service?
 Process- what is the most compelling feature of the product or the business that
will make a difference in the lives of the customers? What sets the product or
service from the rest?

PRODUCT
 A product is any physical good, services or idea that is created by an entrepreneur
or an innovator in serving the customers and addressing their existing problems.

Three-level Concept of products and services:

Level 1: Core Benefits of the product

These are the major factor why a customer buys a product or avails a service.

Example: a customer buys coffee because he or she wants to feel energetic and alert
whole day.

Level 2: Physical Characteristics of the Product or Service

Once the core benefit has been satisfied and options are available to the customers, the
tendency is to look for the second layer selection, i.e., which has a better packaging for
products or a better physical evidence or customer experience for service.

In the previous example, the customer can choose coffe with more appealing packaging
or a more aromatic smell.

Level 3: Augmented Benefits of a Product or Service

These are only additional benefits; a customer will still get the core benefits of a product
or service even without the augmented benefits.

In the previous example, the customer can choose a coffee product that comes with a
loyalty card, so that he or she accumulates, say, 10 coffee drinks, he or she will be able
to get a free coffee drink.

PLACE

Place refers to the location or the medium of transaction. A strategic location depends
on the nature of the business and target market. Place covers the product distribution
and the whole business logistics. The logistics side for products should cover
production, ordering and receiving raw materials or finished goods from the suppliers,
storage, reorder points, and transportation systems. The logistics side for services
covers the physical evidence , service providers, and service delivery process, as well
as policies and procedures of the business.

PRICE
 Price is the value that the entrepreneur assigns to a certain product or service
considering its cost, competition, objectives, positioning, and target market.

Common pricing strategies:

1. Bundling- two or more products or services in one reduced price.
2. Penetration pricing- setting low price to increase market share, but eventually
increase the price once the desired market share is achieved.
3. Skimming- prices are initially high and then they are lowered to offer the product
or service to a wider market.
4. Competitive pricing- benchmarking price with the competitors.
5. Product line pricing- refers to pricing different products or services within a
parallel product array using varying price points.
6. Psychological pricing- considers the psychology and positioning of price in the
market.
7. Premium pricing- refers to setting a very high price to reflect elitism and
superiority.
8. Optional pricing- refers to adding an extra product or service on top of the
original to generate more revenue.
9. Cost plus pricing- basis of mark-up is the cost of sales.
10. Cost base- the mark-up is based on a certain percentage of cost.
Two classification of Cost:
1. Variable Costs or controllable costs- these costs are directly proportional to
number of products manufactured or to the number of services performed.

2. Fixed Costs or uncontrollable costs- these are costs not directly proportional to
the manufacturing of a product or to the performance of the service.

The profit of an entrepreneur can be determined only if there is a proper

computation of costs associated with the product service.

PROMOTION

Promotion involves presenting the products or services to the public and how these
can address the public’s need, wants, problems, or desires.Its main goal is to gain
attention.

Key marketing messages for promotion can be:

1. Value proposition
2. Product or service image
3. Business image
4. Business values

Promotional Tools:
 1. Advertising- is a type of communication that influences the behavior of a
customer to choose the product or service of the entrepreneur over the
competitor.

Types of Advertisements:
Television
Radio
Internet
Mobile phones
Print
Out-of home
2. Selling- This is the act of trading a product or service for a price or a fee.
3. Sales promotion- These are the promotional gimmicks wherein practical
incentives and appealing activities are incorporated to entice the customers to
buy the product or avail the service.

Examples:
Sales discounts or discount coupons
Raffles
Contests and games
Exhibits
Rewards
4. Public Relations- These are image-building initiatives of the entrepreneur to
make the name of the business reputable to stakeholders, such as the target
customers, government agencies, business partners, media and the public.

Examples:
Press conference
Launching events
Social Responsibility events
Web public Relations

PEOPLE
People is one of the three additional Ps in the marketing mix. In the competing
products and services, one of the major differentiator is how people or employees make
difference in the lives of the customers.

Most of the entrepreneurs only hire people when the business starts to expand.
When the need arises to hire people, he or she must identify the specific, necessary job
roles of employees and their descriptions, so they will be able to know their poprpose
clearly and serve customers well.

PACKAGING
 Packaging is how the product or service presented to the customer. Its ultimate goal
is to attract customers to purchase the product or service.

Packaging is very important I selling physical products or good, as it establish the

brand’s identity. Therefore, elements such as color, shape, size, materials, font and text,
and graphics must be considered. In selling service, the term servicescape was used to
refer to the overall ambiance of the place where the service is performed.

PROCESS

Process is defined as the step-by-step procedure or activity workflow that the

entrepreneur or employees follow to effectively and efficiently serve customers. The
internal process includes the back-office operations, wherein employees or machines
process customers’ requests without necessarily being seen by the customers. The
external process includes the actual servicing where customers are part of the process.

LESSON 5. The Brand

Brand refers to the identity of a business, of a product, of a service, or of an

entrepreneur himself or herself. It can be in a form of name, logo and word, and/or
sentence that businesses use to distinguish their product from others.

Brand name is a major differentiator of the entrepreneur against the competitors. To

be different and catchy, a brand name must possess the following characteristics:

 Unique
 Easy to remember
 Can describe a product category
 Can describe concrete qualities
 Positive and inspiring
 Can be converted to other dialects or languages in case the entrepreneur
expands to other territories

Brand logo is a symbol of the business’ identity. The logo must possess the
following characteristics:

 Reflects nature of the business

 Use colors in planned way
 Simple
 Unique
 Fonts picked carefully
 The brand is marketing element that sticks to the mind of the target customers and
the public. Therefore, the entrepreneur must be able to sustain it.

SUMMARY

A strategic marketing plan aids an entrepreneur to select the appropriate target

market, understand customers deeper, and communicate with them in a channel and
language that they will easily understand. Value proposition is a mandatory for an
entrepreneur to differentiate the business with the competitors and to solve their
problem. The process of market segmentation is important in targeting specific group of
customers. The challenge is for the entrepreneur to use and combine the elements of
7Ps and make difference in the arena that the business belongs.

ACTIVITY 1. REFLECT UPON

Can you name the top brand that first come to mind when these products or service are
mentioned? Why do you think they are the top-of-mind brands? Write your answers on
the space provided bellow.

1. Toothpaste
2. Soap
3. Coffee
4. Milk
5. Smartphone

ACTIVITY 2. WHAT HAVE I LEARNED SO FAR?

Choose an existing product or service and give its three-level concept. Each level is
worth 5 points.
Name of product or service: _____________________

Level 1:

Level 2:

Level 3:

ACTIVITY 3. Advertisement

Instruction: Choose an existing product or service here in the Philippines. Create a

video advertisement and design a poster advertisement of your chosen product or
service.

Note:
Video must be sent in the Group chat.
Design must be stapled with this module.
50 points each
Rubrics:
Creativity: 25
Strategic content: 25
Total: 50 points

Reference:
Medina, R.(2014). Entrepreneurship and Small Business Management.(5th ed.).
Sampaloc, Manila: REX Book Store, INC.

Batisan, R.(2016). Entrepreneurship. (1st ed.). Makati City, Philippines: DIWA Learning
Town.