The Role of Marketing Planning (DP IB Business Management)
Revision Note
Written by: Lisa Eades
Reviewed by: Steve Vorster
Marketing Planning
Marketing planning is the process of formulating marketing strategies and tactics that will help a business achieve its marketing objectives
Three tools of marketing planning include
Market segmentation
Market mapping
Market positioning
A marketing plan commonly includes the following elements:
Diagram: components of a marketing plan
1. Marketing objectives
These are specific SMART (specific, measurable, achievable, relevant, and time-bound) goals and may include
Increasing market share
Maximising sales revenue in a particular region or for a certain product
Achieving distribution targets
Improving brand awareness
2. Resources
Planning which resources are required and where they will come from
This may include finance, staff time and expertise, as well as the capital expenditure required to achieve the marketing objectives
3. Research
Marketing research identifies the factors expected to impact upon the marketing plan, such as
Market size and growth
Market segments
Competitor positioning
Customer tastes, preferences and views
The nature of distribution channels
4. The marketing mix
This involves planning the medium- and short-term marketing activities the business intends to undertake and who is responsible for them, including
Pricing strategies and tactics
Promotional activity
Distribution and logistical plans
Product specifications, features and packaging
Physical evidence such as branding
How people and process are developed to support delivery of the rest of the marketing mix
Market Segmentation
Market segmentation is the process in which a single market is divided into sub markets or 'segments'
Each segment represents a slightly different set of consumer characteristics
Firms often segment their markets according to factors such as social status, geographical location, religion, gender, or lifestyle
A target market is one or more market segments at which a product or service is primarily aimed
Diagram: ways to segment the market
A market for a good such as crisps is not simply seen as one market e.g. the crisp market is divided up into many market segments such as
Dinner party snacks (Walkers Sensations, Pringles, Burts) are targeted at middle to upper earners/professionals with a premium price
Health conscious crisps (Walker's lite, Walkers baked, Revita lite) are targeted at the health conscious market
Lunch box value snacks (multipacks, hoola hoops, etc) are targeted at families and the mass market
Evaluation of Market Segmentation
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Examiner Tips and Tricks
It is important that you understand that businesses tend to use several criteria in identifying a market segment at which to target products and services.
For example, Coca Cola's product range is segmented according to gender, health interests and how the product is used (for example, two-litre bottles tend to be consumed at home, whilst cans and 500ml bottles are 'on-the-go products).
Market Positioning & Market Mapping
Market positioning refers to the process a business goes through when launching a new product or service
The business decides where they want to position the product in the market with regard to price, quality, branding, and customer perception
Market mapping is a tool for identifying the position of a product within a market
A market map refers to a two-dimensional diagram that shows the attributes or characteristics of a product in comparison to rivals’ products
Market maps are sometimes called perception maps
Only two criteria can be chosen e.g. price and quality, age and income, etc
Diagram: a market map for chocolate brands
Market map analysis
If there are no spaces left on the market map, it indicates that the market is saturated
This means that there are no opportunities to exploit a market niche in the market
Competition is likely to be high and profits low
However, the existence of a space on the market map may indicate the existence of a market niche
This needs to be researched carefully before the business commits e.g. it looks like there is a gap in the market in high price / low quality area in the map above
This gap does not represent a worthwhile market, as the business would find it impossible to build and maintain a loyal customer base
The Usefulness & Limitations of Market Mapping
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