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Confidentiality Agreement

The undersigned reader acknowledges that the information provided by _______________ in this
marketing plan is confidential; therefore, reader agrees not to disclose it without the express
written permission of _______________.

It is acknowledged by reader that information to be furnished in this marketing plan is in all


respects confidential in nature, other than information which is in the public domain through other
means and that any disclosure or use of same by reader, may cause serious harm or damage to
_______________.

Upon request, this document is to be immediately returned to _______________.

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Signature

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Date

This is a marketing plan. It does not imply an offering of securities.


Table Of Contents

1.0 Executive Summary . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1

2.0 Situation Analysis . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .1


2.1 Market Summary . . . . . . . . . . . . . . . . . . . . . . . . . . . .1
2.1.1 Market Demographics . . . . . . . . . . . . . . . . . . . . .2
2.1.2 Market Needs . . . . . . . . . . . . . . . . . . . . . . . . .2
2.1.3 Market Trends . . . . . . . . . . . . . . . . . . . . . . . .3
2.1.4 Market Growth . . . . . . . . . . . . . . . . . . . . . . . .4
2.2 SWOT Analysis . . . . . . . . . . . . . . . . . . . . . . . . . . . . .4
2.2.1 Strengths . . . . . . . . . . . . . . . . . . . . . . . . . .4
2.2.2 Weaknesses . . . . . . . . . . . . . . . . . . . . . . . . .5
2.2.3 Opportunities . . . . . . . . . . . . . . . . . . . . . . . . .5
2.2.4 Threats . . . . . . . . . . . . . . . . . . . . . . . . . . . .5
2.3 Competition . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .5
2.4 Product Offering . . . . . . . . . . . . . . . . . . . . . . . . . . . .6
2.5 Keys to Success . . . . . . . . . . . . . . . . . . . . . . . . . . . . .6
2.6 Critical Issues . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .6

3.0 Marketing Strategy . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .6


3.1 Mission . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .7
3.2 Marketing Objectives . . . . . . . . . . . . . . . . . . . . . . . . . .7
3.3 Financial Objectives . . . . . . . . . . . . . . . . . . . . . . . . . . .7
3.4 Target Markets . . . . . . . . . . . . . . . . . . . . . . . . . . . . .7
3.5 Positioning . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .8
3.6 Strategies . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .8
3.7 Marketing Mix . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .8
3.8 Marketing Research . . . . . . . . . . . . . . . . . . . . . . . . . . .9

4.0 Financials . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 9
4.1 Break-even Analysis . . . . . . . . . . . . . . . . . . . . . . . . . . 10
4.2 Sales Forecast . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 11
4.3 Expense Forecast . . . . . . . . . . . . . . . . . . . . . . . . . . . 11

5.0 Controls . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 13
5.1 Implementation . . . . . . . . . . . . . . . . . . . . . . . . . . . . 13
5.2 Marketing Organization . . . . . . . . . . . . . . . . . . . . . . . . . 14
5.3 Contingency Planning . . . . . . . . . . . . . . . . . . . . . . . . . 14
Gaian Adventure Fabrics and Notions

1.0 Executive Summary

Gaian Adventure Fabric and Notions is a brick and mortar and an e-commerce company based out
of Eugene, Ore. As the name implies, Gaian sells outdoor fabrics and assorted notions to assist
anyone in completing an outdoor project. Gaian's Internet selection will be large. Additionally,
Gaian will take special care in developing a very easy to use, engaging website. Having an easily
navigated, simple to use, website is key for transforming lookers into customers. The entire Web
inventory will be available at the brick and mortar store located in Eugene. While the majority of
business will be from the website, the brick and mortar store will provide a nice source of revenue
as well.

Through seasoned management and a professionally developed website, Gaian Adventure Fabric
and Notions will rapidly gain market share.

2.0 Situation Analysis

Gaian Adventure Fabric and Notions is a start-up company. Marketing is critical to success and
future profitability. The store offers a wide variety of outdoor fabrics and notions to both the
Eugene area as well as globally through their website. The basic market need is a comprehensive
source for all materials associated with construction of outdoor products and clothing.

2.1 Market Summary

Gaian possesses information about the market and knows a great deal about the common
attributes of our most prized and loyal customers. Gaian will leverage this information to better
understand who is served, their specific needs, and how Gaian can better communicate with them.

Target Markets

Walk-ins
Internet individuals
Internet company customers

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Gaian Adventure Fabrics and Notions

Table 2.1: Target Market Forecast

Target Market Forecast


Potential Customers Growth 2001 2002 2003 2004 2005 CAGR
Walk-ins 9% 3,654 3,983 4,341 4,732 5,158 9.00%
Internet individuals 12% 26,545 29,730 33,298 37,294 41,769 12.00%
Internet company 8% 1,245 1,345 1,453 1,569 1,695 8.02%
customers
Total 11.51% 31,444 35,058 39,092 43,595 48,622 11.51%

2.1.1 Market Demographics

The profile for Gaian's customer consists of the following geographic, demographic, and behavior
factors.

Geographics

• One target market population is the city of Eugene which has a population of 130,000.
• A 20 mile geographic area is in need of the products.
• The other target population is the world. Accessibility is provided to this group through the
Internet.

Demographics

• Primarily female.
• Age 27-46.
• A household income between $35,000-55,000.

Behavior Factors

• Tend to undertake different home projects, whether sewing related or general improvement
projects.
• Would prefer not to buy something that they can make.
• Often have a need for custom products.

2.1.2 Market Needs

Gaian is providing its customers with a wide selection of outdoor fabrics, notions, and accessories.
Gaian seeks to fulfill the following benefits that are important to their customers.

• Selection: Gaian will have the largest selection on the Internet.


• Accessibility: Gaian has the ability to ship to any national or international address.
• Customer service: The customer will be impressed with the level of attention that they
receive.
• Competitive pricing: All products will be competitively priced relative to the competitors.

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Gaian Adventure Fabrics and Notions

2.1.3 Market Trends

The market trend for this industry is for increased selection. This trend is fueled by the Internet
and ability for anyone anywhere to access an online catalog and order from anywhere at anytime.

Before the Internet there were several different mail order companies that would ship nationally,
but their selection was somewhat limited. Since the Internet a few new companies have popped
up, however the established mail order houses have not flocked enthusiastically to the Internet for
unknown reasons.

So while the trend is to embrace the Internet due to its enormous reach and efficiencies, the
established competitors have not embraced the WWW.

Market Forecast

50,000
45,000
40,000
35,000
30,000 Walk-ins
25,000 Internet individuals
20,000
Internet company customers
15,000
10,000
5,000
0
2001 2002 2003 2004 2005

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Gaian Adventure Fabrics and Notions

2.1.4 Market Growth

In 1999, the outdoor fabric and notions retail industry reached $24 million in sales. The industry is
expected to grow at 5% for the next several years. This growth is in part fueled by the desire of
people to save money by making products that they need instead of purchasing them. Additionally,
people have very custom, unique needs that are not commercially produced. In order for their
needs to be met, they make the products themselves to their own specifications.

Target Market Growth

15.00%

10.00%

5.00%

0.00%

2.2 SWOT Analysis

The following SWOT analysis captures the key strengths and weaknesses within the company, and
describes the opportunities and threats that Gaian faces.

2.2.1 Strengths

• Strong relationships with manufacturers and wholesalers.


• Excellent staff who are highly trained and very customer attentive.
• High customer loyalty among repeat customers.

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Gaian Adventure Fabrics and Notions

2.2.2 Weaknesses

• A lack of awareness of Gaian among its national and international target population.
• A limited marketing budget to develop brand awareness.
• The struggle to continually forecast buying trends and stock inventory accordingly.

2.2.3 Opportunities

• Growing market with a significant percentage of the target market still not aware that
Gaian exists.
• Increased sales with a global market.
• The ability to continually improve margins through efficiency gains.

2.2.4 Threats

• Internet competition from an already established brick and mortar or mail order house.
• A slump in the economy decreasing people's discretionary spending.
• A significant increase in shipping costs.

2.3 Competition

Gaian Adventure Fabric and Notions faces competition from several sources:

• Mail order companies: these companies for whatever reason have not yet made it on the
Internet and therefore are not that significant of a worry. They typically will print a catalog
or some sort of flier and mail it out. The company will accept orders either over the phone
or via mail/fax. By virtue of the fact that these companies have yet to migrate to the Web
indicates a fairly stagnant management team/business direction, therefore these
competitors are not of great concern.

• Internet retailers: these companies are similar to Gaian Adventure Fabric and Notions in
that they offer their products to basically anyone using the efficiencies of the Internet.
There are approximately four Internet retailers. None of these sites are close in terms of
product offerings compared to Gaian Adventure Fabric and Notions.

• Retail outlets: these stores take the form of either dedicated fabric stores like Gaian
Adventure Fabric and Notions' brick and mortar store front, or outdoor retailers such as
R.E.I. that carries a LIMITED selection of hardware, notions and fabric. These retail outlets
typically serve the local area and not much beyond this.

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Gaian Adventure Fabrics and Notions

2.4 Product Offering

Gaian Adventure Fabric and Notions will sell a variety of outdoor fabrics and notions for outdoor
applications.

These products include:

• Fleece including Malden Mills 100, 200, 300, power stretch, wind bloc, and thermal stretch.
• Coated nylons including ripstop, taffeta, oxford-poly, oxford-nitrile, packcloth-poly,
packcloth-PVC, 1000 denier Cordura, 500 denier Cordura, and ballistic.
• Breathable fabrics including noseeum netting, sport mesh, micromesh, leno mesh, supplex,
and taslan.
• Waterproof breathables including 3-layer GoreTex, 2-layer GoreTex, Sympatex, and Ultrex.
• Notions including Nikwax waterproofing, hook and loop, nylon and polypropylene webbing,
grosgraine ribbon, poly herringbone, zipper tape and fixed length zippers, thread, assorted
plastic Fastex brand hardware, as well as various patterns.

2.5 Keys to Success

Wide selection, a robust website, and outstanding customer service. Additionally, Gaian Adventure
will:

• Generate repeat business.


• Increase the transaction amount per customer.
• Increase the transaction frequency of long-term customers.

2.6 Critical Issues

Gaian Fabrics and Notions is still in the speculative stage as a brick and mortar retail store and e-
commerce site. Its critical issues are to continue to take a modest fiscal approach; expand at
reasonable rate, not for the sake of expansion in itself, but because it is economically wise to; and
build brand awareness which will drive customers to the store and website.

3.0 Marketing Strategy

Gaian's marketing strategy is based on several initiatives. The first will be advertisements in the
local Yellow Pages. For unique items such as outdoor fabrics and notions, people refer to the Yellow
Pages to find retail stores.

To increase visibility to the local customers, strategic relationships will be formed with local outdoor
stores and sewing shops. These two venues are often asked for referrals from their customers. By
establishing strategic partnerships with these organizations, a lot of local customers will be pointed
to Gaian to satiate their needs.

To increase visibility among Internet customers, Gaian will be submitting their website to all of the
popular search engines. Each submission to a search engine will be specifically tailored for each
engine to ensure top listings from searches.

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Gaian Adventure Fabrics and Notions

3.1 Mission

Gaian Adventure Fabric and Notions' mission is to provide the customer with whatever type of
outdoor fabric and notions that he/she desires. We exist to attract and maintain customers. When
we adhere to this maxim, everything else will fall into place. Our services will exceed the
expectations of our customers.

3.2 Marketing Objectives

• Build the customer database by 25% each year.


• Increase the efficiency of the marketing campaign by 3% each quarter.
• Generate a 15% increase in click-through traffic for the website.

3.3 Financial Objectives

• A double digit growth rate for each future year.


• Reduce fixed costs by 10% by year two.
• Increase profit margins by two percentages each quarter.

3.4 Target Markets

Gaian Adventure Fabric and Notions customers can be broken down into three groups:

• Walk-in local customers: these customers live locally and have come into the shop to
pick up the necessary products for a project.

• Internet individual customers: these are individuals that are in need of supplies for
projects. This group of customers can be further broken down into orders from the USA and
international orders. International orders will be a decent percentage of the overall
individual customers because American fabrics and notions are generally superior to
European alternatives and the convenience of ordering Gaian Adventure's products is
enhanced with Internet accessibility.

• Internet based company orders: some orders will be from people within larger fabric
manufacturers such as DuPont's Cordura department, GoreTex, and Malden Mills. Although
people (typically in the prototype divisions) work for the manufacturer of the fabrics, it is
often difficult for them to get small amounts of the fabric for prototyping. So oddly enough,
some orders will be from GoreTex employees purchasing GoreTex from Gaian Adventure
Fabric and Notions.

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Gaian Adventure Fabrics and Notions

3.5 Positioning

Gaian will position itself as the premier website of outdoor fabrics and notions in this country.
Consumers appreciate a wide selection of products from a single store. Gaian Adventure Fabrics
and Notions will leverage their competitive edge:

• Gaian Adventure Fabric and Notions' competitive edge will be their focus on e-commerce.
The brick and mortar side will be serviced by having the same product offerings that the
website has, as well as having someone in the store to help out with any questions/needs
that a customer may have. This however, is just one small aspect of the overall business.
The foundation of the business is the e-commerce site. This is the foundation because it is
the most cost effective way of operating as a retailer, it serves the largest geographical
region, and the site can be serviced from anywhere at any time of the day.

• Gaian Adventure Fabric and Notions will focus on the website as they recognize this is
where the highest margins are and the largest target market. The website as the primary
focus will allow Gaian Adventure Fabric and Notions to rapidly gain market share as they
will redefine anything on their site to meet the need's of the customers.

3.6 Strategies

The single objective is to position Gaian as the premier location for outdoor fabrics and notions,
commanding a majority of the market share within five years. The marketing strategy will seek to
first create customer awareness regarding the products offered, develop the customer base, and
work toward building customer loyalty.

The message that Gaian seeks to communicate is that Gaian Adventure offers the finest selection
and customer service for outdoor fabric and notions. The message will be communicated in several
ways. The first is through Yellow Page advertisements. Another way is through submissions for all
of the popular Internet search engines. This will generate visibility for Gaian when people are
looking for a outdoor store and use a search engine to find them.

3.7 Marketing Mix

Gaian's marketing mix is comprised of the following approaches to pricing, distribution, advertising
and promotion, and customer service.

• Pricing: Gaian's pricing scheme will be based on achieving a specific margin for each
product.
• Distribution: Gaian can ship all products to any national or international address.
• Advertising and promotion: The most successful advertising will be with the Yellow
Pages as well as submissions with search engines. Additionally, strategic relationships with
local service providers and retail stores will also be a significant source of referrals.
• Customer service: Obsessive customer service is the mantra. Gaian's philosophy is
whatever needs to be done to make the customer happy must occur, even at the expense
of short-term profits. In the long term, this investment will pay off with a fiercely loyal
customer base who is extremely vocal to their friends with referrals.

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Gaian Adventure Fabrics and Notions

3.8 Marketing Research

During the initial phase of the marketing plan development, several focus groups were held to gain
insight into a variety of prospective customers. These focus groups provided helpful insight into the
decision making processes.

An additional source of dynamic market research is a feedback mechanism based on a suggestion


card system. The suggestion card has several statements that customers are asked to rate in
terms of a given scale. There are also several open ended questions that allow the customer to
freely offer constructive criticism or praise. Gaian will work hard to implement reasonable
suggestions in order to improve their service offerings as well as show their commitment to the
customer that their suggestions are valued.

4.0 Financials

This section will offer a financial overview of Gaian Adventure Fabrics and Notions as it relates to
the marketing activities. Gaian will address break-even analysis, sales forecasts, expenses
forecasts, and how those link to the marketing strategy.

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Gaian Adventure Fabrics and Notions

4.1 Break-even Analysis

The Break-even Analysis indicates $11,818 will be needed in monthly revenue to reach the break-
even point.

Target Markets

Walk-ins
Internet individuals
Internet company customers

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Gaian Adventure Fabrics and Notions

4.2 Sales Forecast

The first month will be used to set up the store front and website. There will be no sales activity.
The first three months will have sales activity but it will be fairly slow. Month four will see decent
activity as people begin to become aware of Gaian Adventure Fabric and Notions. Sales will be
large enough to reach profitability by month nine.

Target Markets

Walk-ins
Internet individuals
Internet company customers

4.3 Expense Forecast

The marketing expenses will be budgeted to ramp up sales during the months when consumers
typically spend more on fabrics and notions.

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Gaian Adventure Fabrics and Notions

Monthly IMC Budget

$400

$350

$300

$250
Advertising
$200
Strategic partnerships
$150 Search engine submission

$100

$50

$0
Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec

Table 4.3: Budget

Budget 2001 2002 2003


Advertising $2,250 $3,000 $4,000
Strategic partnerships $605 $800 $1,000
Search engine submission $480 $600 $800
------------ ------------ ------------
Total Budget $3,335 $4,400 $5,800

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Gaian Adventure Fabrics and Notions

5.0 Controls

The purpose of Gaian Adventure Fabrics and Notions' marketing plan is to serve as a guide for the
organization. The following areas will be monitored to gauge performance:

• Revenue: monthly and annual.


• Expenses: monthly and annual.
• Repeat business.
• Customer satisfaction.

5.1 Implementation

The following milestones identify the key marketing programs. It is important to accomplish each
one on time and on budget.

Evaluation Programs

Marketing plan completion

Advertising campaign

Strategic partnerships

Search engine submission

Mar Apr May

Table 5.1: Evaluation Programs

Evaluation Programs Plan


Start Date End Date Budget Manager Department
Marketing plan completion 1/101 3/1/01 Martha Marketing
Advertising campaign 1/101 Ongoing $9,400 Martha Marketing
Strategic partnerships 1/101 Ongoing $2,400 Martha Marketing
Search engine submission 1/101 Ongoing $1,880 Martha Marketing
Totals $13,680

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Gaian Adventure Fabrics and Notions

5.2 Marketing Organization

Martha Thimble is responsible for all marketing activities besides the submission of the website to
different search engines.

5.3 Contingency Planning

Difficulties and risks:

• Problems generating visibility.


• A sudden change of direction (a legitmate entry into the Internet) from an already
established competitor.
• Problems with shippers would have a significant ripple effect on Gaian.

Worst case risks may include:

• Determining that the business cannot support itself on an ongoing basis.


• Having to liquidate equipment to cover liabilities.

Page 14
Appendix: Gaian Adventure Fabrics and Notions
Table 4.3 Budget

Budget Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec
Advertising $75 $125 $250 $250 $200 $200 $100 $150 $250 $250 $200 $200
Strategic partnerships $50 $35 $35 $50 $75 $50 $30 $55 $75 $50 $50 $50
Search engine submission $40 $40 $40 $40 $40 $40 $40 $40 $40 $40 $40 $40
------------ ------------ ------------ ------------ ------------ ------------ ------------ ------------ ------------ ------------ ------------ ------------
Total Budget $165 $200 $325 $340 $315 $290 $170 $245 $365 $340 $290 $290

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