DELOPING SUCCESSFUL

BUSINES PLAN 2
MARKETING PLAN
 MARKETING
…the process of planning and executing the conception,
pricing, promotion, and distribution of ideas, goods,
and services to create exchanges that satisfy individual
and organizational objectives…
American Marketing Association

Marketing is a social and managerial process by which

individuals and groups obtain what they need and
want through creating and exchanging products and
value with others
Philip Kotler
 MARKETING

Our approach:

Marketing is defined as activities that are carried out

systematically to encourage and increase sales of
products/services as long as the activities are in line
with religious and ethical practices.
 SYSTEMATIC EFFORT

• The total marketing activity needs to be planned and

implemented in a systematic manner in order to achieve
the business objectives.
• Without the systematic effort, resources (time, money,
manpower) can be wasted, thus affecting business
performance and profit.
 Encourage and Increase Sales

A systematic marketing effort is essential to:

 ensure customers are attracted and motivated to purchase the
product/service
 Encourage purchase by first-time customers
 Promoting new products/services
 Sustain and increase sales by encouraging repeat purchases.
 Religious and Ethical
Considerations
• Good business practices must be based on awareness
of religious boundaries and ethical practices
• Should ensure the marketing activities are sensitive
to the religious considerations of the target market
and the population
Steps in Preparing a Marketing Plan

1. Define the product concept

2. Identify the target market
3. Estimate market size
4. Identify competitors
5. Estimate market share
6. Develop sales forecast
7. Develop marketing strategies
8. Prepare a marketing plan
 PRODUCT CONCEPT & DESCRIPTION
• Focusing on production: devoting to production
capability, product quality, and continuous product
improvement.
• Assumption: Customers prefer product that offers
highest performance, features or quality.
• Best product will be demanded by the market.
 MARKET?
A market is defined as any entity that has the
purchasing power to acquire goods and services
to fulfill its needs and wants
 Market Categories
Category Profiles
Human Being Geographic
Demographic
Psycho graphic
Governments Local governments
State Governments
Federal Governments
NGOs Environment
Social
Cultural
Business Entities Manufacturer
Wholesaler
Agent/Dealer
Retailer
 IDENTIFYING TARGET MARKET

• group of customers with needs and wants that can

be satisfied by business through the supply of goods
/ services.
• impractical to offer a product that can satisfy the
needs and wants of the entire population
• focus on attracting a core group of customers that
has the highest potential to purchase due to limited
resources
 Market segment

1. Identify products/services that can be offered by the business

2. Market Segmentation
 geographic segmentation
 demographic segmentation
 psychographic segmentation
3. Choose a target market from the identified market segments
– based on higher sales potential and profit
 Geographic Segmentation
• Market sub-grouping based on location of customers
• Key factor to consider is physical distance between the
business location and the target market.
• Other factors: access to business premises, customer mobility,
additional home delivery services, availability of public
transport system
• Example: Dividing a country based on zones, states, postal
codes, district, residency, etc.
 Demographic Segmentation
• Market sub-grouping based on demographic
factors.
• Example: Age, Occupation, Gender, Education,
Income, Social Class, Family
 Psychographic Segmentation

• Market sub-grouping based on psychographic

(Interest, attitude, opinion) factors.
• Example: Dividing a market based on factors such as
personal taste, status, preferences, ego, hobbies,
political attitude, sensitivity to price, motivates of
purchase, loyalty to product.
 ESTIMATING MARKET SIZE

• Market size refers to the total potential purchase of

the target market including purchases of
competitors products within the same market.
• normally stated in monetary term or units and
calculated on daily, weekly, monthly or yearly basis
 COMPETITORS ANALYSIS

• refer to other businesses that offer similar, substitute

or alternative products/ services to the same target
market.
• The entrepreneur should analyze the strengths and
weaknesses of the competitors in terms of size,
experience, years in business, financial ability and
product line
 TARGET MARKET SHARE

• refers to the estimated potential sales of the

business after taking into consideration the market
size and competitors’ influences.
• often represented in terms of percentage of
potential market sized owned.
 Example of market share

ABE Sdn Bhd operates a chicken farm located in

Pontian. The target market for the business are
residents of the immediate rural area as well as
residents of the nearby Pontian town area.
Business estimates the market size for
processed chicken to be 50 000 chickens a
month or RM360,000. ABE has identified 4
main competitors
 Market share before Entry of ABE
Sdn Bhd

COMPETITORS MARKET SHARE (%) MARKET SHARE (RM)

Company A 40% RM144,000
Company B 30% RM108,000
Company C 15% RM54,000
Company D 15% RM54,000
100% RM360,000
 Market share after the Entry of
ABE Sdn Bhd
MARKET SHARE
% RM
Company A 39% 140,400
Company B 27% 97,200
Company C 12% 43,200
Company D 12% 43,200
ABE Sdn Bhd 10% 36,000
100% 360,000
 SALES FORECAST

• Sales forecast is the expected purchases from the

identified target market.
• It is quoted in units or in Ringgit for a period of a
year or a month
• It is developed based on the estimated target
market share
 SALES FORECAST
In forecasting sales, the entrepreneur
should consider the followings:
 Customers’ awareness
 Seasonal factors
 Characteristics of the business
sector – duration to harvest
 Strength of competitors
Note: Prepare monthly for the first year and
annually for the second and third year
Customer Awareness
• Customer Awareness of a business that
just started will take some time
• Business can expect sales to be less
that estimated market share
• Can speed up customer awareness
with an aggressive marketing effort.
• Effort should focus on promoting the
product/services and building trust
between business and the target
market
 Seasonal Factors

Customer buying patterns can be influenced by certain

seasons that occur within a particular business period
such as Hari Raya, CNY, Deepavali, Christmas, school
holiday, weather conditions.
 ESTIMATING YOUR SALES
• What is the accepted average profit margin?

• How much is your variable and fixed costs?

• Calculate your minimum sales required for one year.

 CALCULATING PROFIT MARGIN

• Gross Profit Margin = Sales – COGS

Sales

• Minimum Sales Required = Fixed Costs

Desired Margin
Developing Marketing Strategies
In order to achieve its sales forecast,
the entrepreneur must develop
appropriate marketing strategies
to generate sales from the target
market. Factors to consider:
 Product/Service
 Price
 Place (distribution)
 Promotion
PRODUCT AND SERVICE
STRATEGIES

 Product Design/Service
Package
 Packaging
 Brand Name
 After Sales Service
 BRAND
• Is a name, term, sign, symbol or design that
identifies a product and differentiates it
from other product.
• Adds value to the product/ service and
encourages customer loyalty.
• Should reflect the benefits and qualities of
the product/service, be easy to pronounce,
recognise, remember, not be sensitive to
any parties or race have no negative
connotations
 QUALITY
• Can be a major positioning
tool for a business
• Can be in terms of
performance quality and
conformance to quality
 DESIGN
• In designing products,
entrepreneur needs to
understand the function of
product to the consumers
• E.g, food caterer  service
must be accordance to
customer’s specification
 PACKAGING
• Protection – must be able to protect
the product during the process of
transportation, storage, display and
sales
• Ease of use – easy for customer to
use
• Product differentiation – must
differentiate from competitors
 PACKAGING
• Attractive to customers – size, shape,
material used, color
• Product safety – must have childproof,
tamper-resistant packaging
LABELLING
• Perform several functions
such as identifying, grading,
describing or even
promoting the product
• Labels provide information
about the manufacturer, the
contents of the product,
usage instruction or warning
AFTER SALES SERVICE
• Good AFS please
customer and
encourages repeat
purchases.
• Help answer key
questions about
customers
PRICING STRATEGIES

 Value-based pricing- perceived

value
 Cost-based pricing
 Cost-plus pricing - Price = Cost +
Mark-up
 Break-even pricing - Priced to
equate cost
 Competition-based pricing – priced
based on the going rate
Value-based pricing
• Customers’ perception of
the value of a product is a
key factor considered in
pricing the product or
service.
• The perceived value is
associated with the
benefits that the customer
believe are derived from
the product/service
Cost-based Pricing
• Based on the total cost of
the product or service + a
standard mark up
• Mark up based on :
average profit margin, the
number and strength of
competitors
Competition-based pricing

• The most common

form of CBP is the
going rate pricing
• Business bases it price
largely on the
competitors’ prices
 Distribution Strategy
• Aimed at establishing a structures and controllable
distribution system to ensure the product offered
reaches the target customer.
• Moves goods from producers to consumers
• Most common form:
 Direct to Consumer
 Selling Through Retailers
 Selling through wholesalers
 Selling Through wholesaler and retailers or agent
Distribution Strategies
Distribution Strategies
 PROMOTION STRATEGIES

Advertising
 e.g. newspaper, television, radio,
magazines
Sales promotion
 e.g. premiums, patronage rewards, point-of-
purchase promotions, coupons
Public relations
 e.g. sponsorship
 MARKETING BUDGET
Fixed asset
– Signboard
– Transportation (Buy)

Monthly expenditure
– Salaries and fringe benefits of marketing staff
– Transportation (Rent & Maintenance)
Other expenditures
– Advertisement/promotion