By: Tony Rossell
Happy New Year! It’s time to develop, or at least review, your marketing plan, so I thought it might be useful to outline the marketing planning methodology that I use to brainstorm and develop strategies for organizations.
We are all familiar with the four “P”s: Product, Price, Place and Promotion. They are established tools in marketing to help define strategy, but I find that they do not serve membership groups as well.
So to serve membership organizations better, I have adapted the four “P”s to the following:
Market – Answers the question, “WHO?”
Product – Answers the question, “WHAT?”
Promotion – Answers the question, “HOW?”
Economics – Answers the question, “WHY?”
Let me make a few quick comments about each of these.
First, any sound marketing strategy needs to look at “who” we want to reach. I have found it helpful to break most markets down visually using a triangle or pyramid.
At the top of the triangle are the best prospects for the product that we are offering. If properly defined, this is almost always the smallest segment. As we work our way down to less qualified prospects, we have increasing numbers of potential members or customers – hence the wider triangle. The goal, of course, is to be sure that we flow our scarce marketing funds first to the best prospects and then down the triangle to generate the best ROI.
Taking the time to carefully define who is in each market segment and how many people are in the segment is fundamental to planning.
Next, define “what” you are offering. Should your product be bundled or sold a la carte? What are your best price points? What is your unique selling proposition (USP) to each market segment? What enhancements can be made to the product to make it unique or more valuable? How does your product compare to the competition?
The third element is promotion or “how” we go to market. Unfortunately, many marketers start at this point without doing the earlier leg work. I sometimes, for example, hear that “direct mail doesn’t work for our organization.” It is possible, but it is more likely that the channel is not to blame, but the message went to the wrong person. You cannot sell ice to Eskimos.
Promotional decisions look at how best to connect the product and the market. What marketing channel should you choose (personal sales, telemarketing, direct mail, space ads, broadcast FAX, email, search engine ads, or retail)? Each channel offers unique advantages, cost structures, and response rates.
Finally, marketing planning requires an answer to the question, “why.” Does the plan make economic sense? This involves looking at realistic projections of revenue and costs and calculating the Life Time Value, Cost of Goods Sold, and Maximum Acquisition Cost for a member or customer. I provided these calculations in a membership marketing context in my post on September 10th, Membership Marketing Calculations and Formulas.
I hope that these thoughts get your strategic marketing juices flowing. If you need help in planning for your 2011 marketing efforts, please feel free to contact me.
Tony is Senior Vice President at Marketing General Inc and can be reached at firstname.lastname@example.org