Deconstructing the Modern Marketing Plan
From Core Strategy to Sustainable Growth
The Core of Strategy
A marketing strategy is not just a single idea; it’s a powerful combination of three critical elements that guide a firm’s efforts. It defines who to target, what to offer, and how to build a lasting advantage in the marketplace.
Target Market
Marketing Mix (4 Ps)
Sustainable Competitive Advantage
Building a Sustainable Competitive Advantage (SCA)
An advantage over the competition that is not easily copied and can be maintained over a long period is crucial. Firms achieve this by focusing on four key areas of excellence.
Customer Excellence
Retaining loyal customers and providing outstanding customer service.
Operational Excellence
Achieved through efficient operations and excellent supply chain and human resource management.
Product Excellence
Having products with high perceived value and effective branding and positioning.
Locational Excellence
Having a good physical location and internet presence.
The 5-Step Marketing Plan Blueprint
A formal marketing plan provides a roadmap for a firm’s activities. It follows a logical five-step process, moving from broad objectives to specific implementation and control.
Mission & Objectives
SWOT Analysis
Identify Opportunities (STP)
Implement Marketing Mix
Evaluate Performance
Step 2: Situation Analysis (SWOT)
Before setting a course, a firm must understand its current position. A SWOT analysis assesses the internal environment (Strengths, Weaknesses) and the external environment (Opportunities, Threats).
Strengths (Internal, Positive)
- Strong brand recognition
- Loyal customer base
- Efficient supply chain
Weaknesses (Internal, Negative)
- High production costs
- Limited product line
- Outdated technology
Opportunities (External, Positive)
- Emerging markets
- New technologies
- Favorable regulations
Threats (External, Negative)
- New competitors
- Economic downturn
- Changing consumer tastes
Step 3: Finding Your Focus (STP)
Firms can’t be everything to everyone. The STP process helps identify the most valuable parts of the market to serve. This involves dividing the market (Segmentation), choosing a group (Targeting), and creating a clear image in their minds (Positioning). Hertz provides a classic example of this process in action.
Segment |
Description |
Hertz Collection Offered |
|---|---|---|
Thrill Seekers |
Single gear heads on vacation |
Adrenaline Collection (e.g., Corvette) |
Luxury Seekers |
Business customers and families preferring luxury |
Prestige Collection (e.g., Cadillac) |
Eco-Conscious |
Environmentally conscious customers |
Green Collection (e.g., Toyota Prius) |
Commercial |
Commercial customers needing vans/trucks |
Commercial Van/Truck |
By segmenting the market, Hertz can position itself as the first choice for each distinct target group with a tailored offering.
Step 4: The Marketing Mix (The 4 Ps)
With a target in mind, the firm deploys the marketing mix—the controllable tactical marketing tools that it blends to produce the response it wants in the target market.
Product (Value Creation)
The fundamental purpose is to create value by developing a product or service that customers perceive as valuable enough to purchase.
Price (Value Capture)
Price is what the customer is willing to pay. It must be set so that the customer perceives good value for the product they receive.
Place (Value Delivery)
The product must be readily accessible when and where the customer wants it, through efficient distribution and retail channels.
Promotion (Value Communication)
This is about communicating the value proposition to the target audience through advertising, PR, social media, and other channels (IMC).
Step 5: Measuring Success (Portfolio Analysis)
To evaluate performance, firms often use portfolio analysis tools like the Boston Consulting Group (BCG) matrix. It classifies a firm’s products or services into a two-by-two matrix based on their market growth rate and relative market share.
This analysis helps firms decide which products to build, hold, harvest, or divest. For example, a “Star” like the iPhone requires heavy investment to fuel its growth, while a “Cash Cow” like the Mac generates more cash than it needs.
Charting the Path to Growth
Firms can’t stand still. Growth strategies outline how they can expand their business, either by focusing on current offerings and markets or by branching out into new ones.
Market Penetration
Selling more of the same product to the same market. (e.g., Holiday-themed Coca-Cola cans to encourage more sales).
Product Development
Introducing new products to the current market. (e.g., Coca-Cola creating Cherry Coke and Vanilla Coke).
Market Development
Selling existing products to new markets. (e.g., Coca-Cola introducing Diet Coke and Coke Zero to target new health-conscious segments).
Diversification
Introducing new products to new markets. The riskiest strategy. (e.g., Coca-Cola acquiring Vitaminwater or launching branded apparel).