Common Problems in Marketing Plans

WSJ published a great piece early this summer entitled How to Write a Good Business Plan that starts off pointing out why a down economy is a great time to start a new business (lower costs, less competition) and then goes on not to tell you about the right way to do everything but some of the pitfalls to avoid.

I had fun with the piece but was drawn mostly to the table (at the end of the online version) that cites overused phrases/concepts in really bad business plans including two of my favorite pet peeves:

1. HUGE — as in the market in so huge, everyone is going to want to buy our product. Get a grip. there may be lots of biz opportunity out there but if you can’t quantify your market opportunity, you’re never going to be able to put together a business plan much less a marketing plan to go after them. I’m constantly faced with owners who want to market to everyone… and can’t afford it.

2. NO COMPETITION — For real? There are very few entirely new concepts out there, just new and better ways of marketing them. Don’t be so naive to think that you have no competition. Everyone has competition. The trick is figuring out who they are and how to do a better job of attracting customers.

If you’re in the market to write a new business plan, you may find the updated release of Biz Plan in a Day from Rhonda Adams to be helpful. I’m not endorsing her product as the best solution but for a quick and dirty workbook to get you started, it is definitely a running start.

Increase in Advertising Spending = Recovering Economy or Desperation?

About six months ago I started encouraging clients to take advantage of the pull back in advertising spend to make their dollar go further by taking advantage of greatly reduced rates. My clients don’t do a lot of display but the same mantra held true for most of the available media at the time.

Over the summer I noticed an uptick in marketing spend in my business serving the SMB space and subsequently confirmed the same was true with my counterparts serving the medium enterprise and global corporation space. Conjecture might say this signals a turn in the economy, but is that true?

The WSJ reported this morning that the dental market is seeing a 10% drop on average in patient billings largely due to unemployment rate. People without dental insurance stop going and those high brow vanity treatments don’t seem as important when we’re counting our pennies. The article goes on to describe how dentists are having to get creative with their marketing efforts and spend less time seeing patience and more time recruiting them. The old reminder postcards aren’t bringing patients in as fast and thus dentists are trying the same tricks as everyone else: email campaigns and twitter.

So perhaps the increase in marketing spend is just a sign that business are finally having to do what we marketing folks have told them all along: focus on your best prospects, show love to your best clients, identify to your competitive advantage and then promote it in more ways than buying one ValPak envelope a year and putting your initials on the door?

I think what in fact what is happening is that certain businesses are preparing to thrive. They’re establishing a robust infrastructure, staking their claim on their space and working harder to protect their brand. It’s not just a marketing investment that will help them succeed. It’s their overall investment in their business from people to technology that is helping them ramp up and prepare to take market share from the competition who instead of investing has squeezed every available dime out of their business and hidden it under the mattress.

Planning to Use Social Media is Not the Same as Planning Your Social Media Strategy

Back when everyone read Kotler’s marketing textbook and set about defining an approach to the 4 P’s, businesses had marketing plans. The plans specified the who and the what of the business before getting into the sexier issues of how we’re going to do it.

Lately folks seem to have that engine backwards. They’re skipping past the planning stages — where we identify our audience, the value of our product, the competition and our competitive advantage — and running right along to a marketing strategy which sounds suspiciously like quick throw up a web site (no pun intended) and start tweeting about our biz and see who comes runnning.

Tweeting about your beer special may have brought 6 customers in for free pint glass night at Taco Mac (see article in this morning’s AJC), but it certainly isn’t a big enough marketing success to make a difference in your quarterly revenues.

David Armano took the time to draw parallels between application design and social media planning in a witty post that draws humorous analogies to watching MacGyver. He makes an extremely valid point about social media being more than a tool but an entire approach to your business while endorsing the idea that before you dive head first into this new universe and start pontificating about the transparent and customer-centered approach of your business that you take the time to make sure your reality aligns with your on-line identity.

While being honest is important (albeit critical), the other really important issue to address here is one of consistency. If twitter is something you do in your free time, blogging happens occasionally when your PR firm reminds you and facebook has been relegated to your summer intern, you should stop now. It’s not a strategy if you just do it once. That’s called dabbling. If you’re serious about using social media to promote your business, make sure your plan not only identifies which platforms you plan to use and what you plan to use them for but includes a budget (time and money and resource allocation) to keep it going far past the next quarterly sales meeting.

New Must Read Now in Paperback

Earlier this year I had the opportunity to read Prince and Schiff’s The Middle-Class Millionaire, courtesy of the Fulton County Public Library system. Subsequently I find myself referring this book to clients and friends left and right, each time returning to Amazon to search for a hardback book published in 2008 that had millionaire in the title. Imagine how tough that is? Finally I decided it was time to add this to my must-read this and found that the book is now available in paperback, just under a different name. The new name is the Influence of Affluence and saves you about $5 on Amazon over the hard cover.

The book makes a very sound point about how those millionaires with a net worth in the $1-5 million range are so influential in their purchasing decisions that they could rightfully be the key to many business/products success. Why you ask? Because they are so keyed into the idea of giving and seeking referrals. They routinely ask their friends and associates for input on purchasing decisions and readily share their opinions with others — more so than any of the other demographic segments surveyed by the authors.

Now I will warn you, this is a rather technical read but if you’re committed to target marketing, it is a great one. If you’re still not sure, check out these key concepts courtesy of the authors.

If McDonald’s can raise their prices in this recession, can you?

Mickey D’s raised the price of a cheeseburger 19 cents in December, or at least that is what Fortune Magazine tells me. I can’t say that I eat often enough at McDonald’s to notice (but I am a fan of their $1 iced tea).

At a time when everyone else is worried about losing customers, can they really afford to raise prices and risk irking their customers? Apparently so. While McDonald’s stock hasn’t done so well since the first of the year (NYSE: MCD), they were reported to be one of the only Dow stocks last year to hold their value. Contribute that feat to the fact that consumers still want to eat out, just don’t want to spend as much doing it and  now you know why they can afford to raise the price of cheeseburgers. (Have you seen the price of cheeseburgers at Ruby Tuesday’s and other casual dining establishments?)

So how does this price raising success story benefit your business? Well it depends.

Government employees and Fortune 500 workers would be appalled not to receive at least a cost of living increase each year along with their annual merit raise but the sad reality for the rest of us is that increases of any kind only come when the business makes more money. To make more money we’ve pretty much got to sell more or raise our prices. But can you truly afford to increase prices at a time when today’s Atlanta Business Chronicle notes that businesses across Georgia are reducing or postponing their capital expenses until better times? Depends on what you are selling.

We don’t have to go back to Kotler to recall that part of marketing your services is setting a price that truly represents the value of your offerings. Price too low and the value is perceived as cheap or less durable (think WalMart) and price too high and you place things out of reach (think Maserati Qattroporte). You’ve got to price just right for your particular audience or customer base, sometimes even offering different prices for different customers.

As demand for services increases and quite possibly the cost of delivering services increases sometimes it makes sense to raise the price. There are still businesses making money and some even thriving in this economy. If yours is one of them then God bless you. But if it means you have to charge more to maintain the same level of quality in your product or service that brought you the success that you already have then perhaps you, too, like Mickey-D’s, should beraising your prices.