Scarb Eesbm6e PPT 08

CHAPTER 8
Building a Powerful
Marketing Plan
Copyright © 2011 Pearson Education, Inc. Publishing as Prentice Hall

Building a
Guerrilla Marketing Plan
 Marketing
 The process of creating and delivering
desired goods and services to customers.
 Involves all of the activities associated with
winning and retaining loyal customers.
 National Federation of Independent
Business Study
 55% of small business owners say they do
not need marketing because their products
and services “sell themselves.”
Ch. 8: Building a Powerful Marketing Plan Copyright © 2011 Pearson Education, Inc. Publishing as Prentice Hall 8-2
Building a
Guerrilla Marketing Plan
Guerrilla marketing strategies:
 Are unconventional, low-cost, and
creative marketing techniques that
allow a small company to realize a
greater return from its marketing
investment than do larger rivals.
 Do not require large amounts of
money to be effective – just creativity.
A Guerrilla Marketing Plan
1. Pinpoints the specific target markets the
company will serve.
2. Determines customer needs and wants
through market research.
3. Analyzes a firm’s competitive advantages
and creates a marketing strategy to build
a competitive edge.
4. Helps to create a marketing mix that
meets customer needs and wants.
Pinpointing the
Target Market
 One objective of market research: Pinpoint
the company's target market, the specific
group of customers at whom the company
aims its products or services.
 Marketing strategy must be built on clear
definition of a company’s target
customers.
 Examples: Great Call and Lexus
of Palm Beach
Pinpointing the
Target Market
 Target customer must permeate the
entire business – merchandise sold,
background music, layout, décor, and
other features.
 Without a clear image of its target
market, a small company tries to reach
almost everyone and
ends up appealing to few.
Market Research
 Market research is the vehicle for gathering
the information that serves as the foundation
for the marketing plan.
 Never assume that a market exists for your
company’s product or service; prove it!
 Market research does not have to be time
consuming, complex, or expensive to be
useful.
 Web-based market research – online surveys
 Trend-tracking
Tracking Trends
 Read many diverse current publications
 Monitor blogs and newsgroups
 Watch the top 10 TV shows
 See the top 10 movies
 Talk to at least 150 customers a year
 Talk with the 10 smartest people you know
 Listen to your children and their friends
Market Research
How to Conduct Market Research:

1. Define the objective.
2. Collect the data.
 Individualized (one-to-one) marketing
How to Become an Effective One-to-One Marketer
Enhance your products and
Identify your best customers,
services by giving customers
never passing up the
information about them and how
opportunity to get their names.
to use them.
See customer complaints

Collect information on these for what they are - a
customers, linking their chance to improve
identities to their transactions. your service and
quality. Encourage
Successful complaints and then
One-to-One fix them!
Marketing
Calculate the long-term value Make sure your company’s

of customers so you know product and service quality
which ones are most desirable will astonish your customers.
(and most profitable).
Know what your customers’
buying cycle is and time your Source: Adapted from Susan Greco,
“The Road to One-to-One Marketing,”
marketing efforts to coincide Inc., October 1995, pp. 56-66.
with it - “just-in-time marketing.”
Ch. 8: Building a Powerful Marketing Plan Copyright © 2011 Pearson Education, Inc. Publishing as Prentice Hall 8 - 10
Market Research (continued)
How to Conduct Market Research:

1. Define the problem.
2. Collect the data.
 Individualized (one-to-one) marketing
 Data mining
3. Analyze and interpret the data.

4. Draw conclusions and act.
Relationship Marketing
(Customer Relationship Management)
In addition to the text
Involves developing and maintaining

long-term relationships with customers
so that they will keep coming back to
make repeat purchases.
Relationship Marketing
(Customer Relationship Management)
Steps:
 Collect meaningful customer information
and compile it in a database.
 Mine the database to identify “best”
customers.
 Use the information to develop lasting
relationships with “best” customers.
 Attract more customers who fit the “best”
customer profile.
The Relationship Marketing Process
If you have done everything
else correctly, this step is
relatively easy. Superb
Analyze
customer service is the
best way to retain Sell,
your most valuable
customers. Service, Conduct detailed customer intelligence to
& Satisfy pinpoint most valuable customers and to
learn all you can about them, including
their lifetime value (LTV) to the company.
Build
Connect
Relationships
&
Collect
Based on what you have
learned, contact customers
Make contact with most valuable customers
with an offer designed for
them. Make customers feel
Learn and begin building a customer database
special and valued. using data mining and data warehousing
techniques.
Learn from your customers by encouraging

feedback from them; develop a thorough
customer profile and constantly refine it. In addition to the text
Steps in CRM
 Collect meaningful information on existing

customers and compile it in a database.
 Mine the database to identify the company’s
best and most profitable customers and their
buying habits.
 Use the information to establish lasting
relationships with these customers.
 Attract more customers who fit the profile of
the company’s best customers.
Four Levels of Customer Sensitivity
Level 4: Customer Partnership
Level 3: Customer Alignment
Level 2: Customer Sensitivity
Level 1: Customer Awareness
Guerrilla Marketing Principles
 Find a niche and fill it.
 Use the power of publicity
 Don’t just sell; entertain!
 “Entertailing”
 Strive to be unique.
Guerrilla Marketing Principles (continued)
 Connect with customers on an emotional

level.
 Build trust
 Define a unique selling proposition
(USP)
Unique Selling Proposition
 A key customer benefit of a product or
service that sets it apart from its
competition.
 Answers key customer question:
“What’s in it for me?”
 Consider intangible or psychological
benefits as well as tangible ones.
 Communicate your USP to your
customers often.
FIGURE 8.1 The Connection between Branding and a USP
Source: Based on Brandsavvy, Highlands Ranch, Colorado
(continued)
 Create an identity for your business

through branding.
Building a Brand In addition to the text
High
“Antes” “Drivers”
Features that are important Features that are both
to customers but all important to customers and are
competitors provide them highly differentiated from those
of competitors
Every company in the
market must “ante up” on These are the attributes on
Relevance
these features. which a company must focus to

build its brand.1
“Neutrals” “Fool’s Gold”

Features that are irrelevant to Features that are unique to
customers your company but do not drive
customers’ loyalty to your
These features are useless product and services
when it comes to branding.
Don’t make the mistake of
trying to build a brand on
Low these features!
Low Differentiation High

Ch. 8: Adapted
Source: Buildingfrom
a Powerful Marketing
“What Really Matters in Plan Copyright
Building a Brand,” © 2011Quarterly,
The McKinsey Pearson Education,
May Inc. Publishing as Prentice Hall
2004, www.mckinseyquarterly.com/newsletters/chartfocus/2004_05.htm 8 - 22

through branding.
 Embrace social networking.
Social Networking
 Social networks sites, such as Facebook
and MySpace, allow entrepreneurs to
connect with potential and existing
customers at little or no cost.
 More than half of Facebook users are
over the age of 25.
 These sites now offer business survey
tools and advertising functions
for promotional purposes.

through branding.
 Start a blog.
Blogging
 An estimated 113 million blogs exist
with 5,000 of them from businesses.
 Economical and effective online
communication.
 Blog Guidelines:
 Be honest, balanced, and interesting.
 Post blog entries consistently so that
readers have a reason to return.
 Ask customers for feedback.
Blogging
(continued)
 Strive to cultivate the image of an

expert or a trusted friend on a topic
that is important.
 Use services such as Google Alerts
that scan the Web for a company’s
name and send e-mail alerts when they
find posts.
 Promote the blog via e-mail and
promotional Web Sites.

through branding.
 Start a blog.
 Create online videos.
Online Videos
 Study: 19% of Internet users watch
online videos every day.
 Online video guidelines:
 Think “edutainment.”
 Be funny.
 Connect with current events.
 Involve customers.
 Keep it short.

through branding.
 Start a blog.
 Focus on the customer.
Focus on the Customer
Only 6% of customers who experience a
problem contact the company to complain.
31% tell family members, friends, and colleagues
about their negative experience.
6% of those people tell their “horror stories” to
six or more people.
For every 100% of customers who have negative
experiences with a business,
the company stands to lose
32 to 36 current customers
or potential customers.
Focus on the Customer (continued)
 Because 20% of a typical company’s customers

account for about 80% of its sales, no business
can afford to alienate its best and most
profitable customers and survive!
 Research shows that repeat customers spend
67% more than new customers.
 Attracting new customers costs the
typical business seven to nine times
as much as keeping existing customers.
Principles of Customer Experience Management (CEM)
Every customer interaction should be:
• Intimate
• Personal
• Consistent, courteous, and professional
• Responsive
Satisfied,
loyal,
• Helpful information and advice
repeat
• Involvement of caring, well-trained people
(and profitable)
• Long-term relationship view customers
• Emphasis on sustaining an ongoing
relationship
• Nurturing the company/customer relationship
Source: Adapted from “Wake-Up Call: To Fix CRM, Fix
the Customer Experience Now!, BearingPoint White
Paper (www.bearingpoint.com, Fall 2005, p. 5.
Focus on the Customer
(continued)
Companies that are successful at retaining

their customers constantly ask themselves
(and their customers) four questions:
1. What are we doing right?
2. How can we do that even better?
3. What have we done wrong?
4. What can we do in the future?
 Create an identity for your

business through branding.
 Start a blog.
 Be devoted to quality.
Devotion to Quality
 Study: 60% of customers who change suppliers
do so because of problems with a company’s
products or services.
 World-class companies treat quality as a strategic
objective, an integral part of company culture.
 The philosophy of Total Quality Management
(TQM):
 Quality in the product or service itself.
 Quality in every aspect of the business and its
relationship with the customer.
 Continuous improvement in quality.
How Do Americans Define
Quality in a Product?
 Reliability (average time between
breakdowns)
 Durability (how long an item lasts)
 Ease of use
 Known or trusted brand name
 Low price
How Do Americans Define
Quality in a Service?
 Tangibles - equipment, facilities, people
 Reliability - doing what you say you will do
 Responsiveness - promptness
in helping customers
 Assurance and empathy -
conveying a caring attitude

through branding.
 Start a blog.
 Be devoted to quality.
 Pay attention to convenience.
Attention to Convenience
The average U.S. work week is 42.5 hours,
an increase from 37.5 hours in 2003.
Is your business conveniently located near
customers?
Are your business hours suitable to your
customers?
Would customers appreciate pickup and
delivery services?
Do you make it easy for customers to buy
on credit or with credit cards?
Attention to Convenience
(continued)
 Are your employees trained to handle
business transactions quickly, efficiently, and
politely?
 Does your company offer “extras” that would
make customers’ easier?
 Can you bundle existing products to make it
easier for customers to use them?
 Can you adapt existing products to make
them more convenient for customers?
 Does your company handle telephone calls
quickly and efficiently?
 Concentrate on innovation.
Concentration on Innovation
 Innovation
The key to future success.
 One of the greatest strengths of
entrepreneurs. It shows up in the new
products, techniques, and unusual
approaches they introduce.
 Entrepreneurs often create new products
and services by focusing their efforts on
one area and by using their size and
flexibility to their advantage.
 Be dedicated to service and customer
satisfaction.
 Survey: 25% of customers have walked
out of a store within the past year
because of poor service.
 Survey: 80% say they will never return to
a business after a negative customer
service experience.
Dedication to Service
Goal: To achieve customer astonishment!
 Listen to customers.
 Define “superior service.”
 Set standards and measure performance.
 Examine your company’s service cycle.
 Hire the right employees.
 Train employees to deliver superior
service.
Dedication to Service (continued)
 Empower employees to offer superior

service.
 Treat employees with respect and show
them how valuable they are.
 Use technology to provide improved
service.
Dedication to Service (continued)
 Use mystery shoppers to measure customer

service
 Reward superior service.
 Get top managers’ support.
 View customer service as an investment,
not an expense.
(continued)
 Be dedicated to service and
customer satisfaction.
 Emphasize speed.
Emphasis on Speed
 Use principles of time compression
management (TCM):
 Speed new products to market
 Shorten customer response time in
manufacturing and delivery
 Reduce the administrative time required to
fill an order.
 Study: Most businesses waste
85 to 99% of the time required
to produce products or services!
Emphasis on Speed
(continued)
 Re-engineer the process rather than try

to do the same thing - only faster.
 Create cross-functional teams of
workers and empower them to attack
and solve problems.
 Set aggressive goals for
production and stick to
the schedule.
Emphasis on Speed
(continued)
 Rethink the supply chain.

 Instill speed in the company culture.
 Use technology to find shortcuts
wherever possible.
 Put the Internet to work for you.
The Marketing Mix
Product
Place
Price
Promotion
FIGURE 8.2 Five Characteristics of a Great Product
The Product Life Cycle
FIGURE 8.3 The Product Life Cycle
Stages in the Product Life Cycle
 Introductory stage
High
Costs
Stages in the Product Life Cycle (continued)
 Growth and acceptance stage
High High
Sales
Costs Costs
Climb
 Maturity and competition stage
High Sales Profits

Costs Climb Peak
 Market saturation stage
High
High Sales
Sales Profits Sales
Costs Profits Sales
Costs Climb
Climb Peak
Peak Peak
Peak
 Market saturation stage
 Product decline stage
High Sales &

High
High Sales
Sales Profits
Profits
Profits Sale
Sales
Sales Profits
Costs
Costs
Costs Climb
Climb Peak
Peak s
Peak
Peak Peak Fall
Peak
FIGURE 8.4 Time between Introduction of Products
Place: Channels of Distribution
Consumer Goods
Manufacturer
Consumer
Manufacturer Retailer Consumer
Manufacturer Wholesaler Retailer Consumer
Manufacturer Wholesaler Wholesaler Retailer Consumer
Place: Channels of Distribution
Industrial Goods
Manufacturer
Industrial User
Manufacturer Wholesaler Industrial User
Price
 A key factor in the decision to buy
 Focus attention on non-price
competition
 Free trial offers
 Free delivery
 Lengthy warranties
 Money back guarantees
Promotion
 Goal: To inform and persuade.
 Through advertising and other
communication techniques.
 Create an image.
 “Marketing is not a battle of products;
it is a battle of perceptions.”
Conclusion
 A guerrilla marketing plan offers the
entrepreneur significant benefits.
 Target marketing is key.
 Create a competitive and edge
through customer focus, quality,
convenience, innovation,
service and speed.
All rights reserved. No part of this publication may be
reproduced, stored in a retrieval system, or transmitted, in any
form or by any means, electronic, mechanical, photocopying,
recording, or otherwise, without the prior written permission of
the publisher. Printed in the United States of America.

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CHAPTER 8

Copyright © 2011 Pearson Education, Inc. Publishing as Prentice Hall

How to Conduct Market Research:

See customer complaints

Calculate the long-term value Make sure your company’s

How to Conduct Market Research:

3. Analyze and interpret the data.

Involves developing and maintaining

Learn from your customers by encouraging

 Collect meaningful information on existing

Level 4: Customer Partnership

Level 3: Customer Alignment

Level 2: Customer Sensitivity

Level 1: Customer Awareness

 Connect with customers on an emotional

 Create an identity for your business

these features. which a company must focus to

“Neutrals” “Fool’s Gold”

Low Differentiation High

 Create an identity for your business

 Create an identity for your business

 Strive to cultivate the image of an

 Create an identity for your business

 Create an identity for your business

 Because 20% of a typical company’s customers

Companies that are successful at retaining

 Create an identity for your

 Create an identity for your business

Goal: To achieve customer astonishment!

 Empower employees to offer superior

Goal: To achieve customer astonishment!

 Use mystery shoppers to measure customer

 Re-engineer the process rather than try

 Rethink the supply chain.

FIGURE 8.3 The Product Life Cycle

High Sales Profits

High Sales &

Manufacturer Retailer Consumer

Manufacturer Wholesaler Retailer Consumer

Manufacturer Wholesaler Wholesaler Retailer Consumer

Manufacturer Wholesaler Industrial User

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