A simple distinction: a marketing strategy is what you want to do to achieve your marketing objectives while a marketing plan is how you want to do it. The marketing strategy identifies the various market-centric pathways or options you want to follow to achieve your marketing objectives. It is the big picture of your company’s marketing functions. The marketing plan lays out the different tactical plans you will execute to propel your marketing strategy. It provides the details of the big picture.
Let us briefly explain the salient points of each of these marketing studies.
You start by stating specific, measurable, achievable, realistic, and time-bound marketing objectives. The marketing objectives are derived from your company’s goals like sustaining competitive advantage for long-term profitability and growth.
You conduct market research to gather important data about your industry and target market
- Target market
You define who will consume or use your product (or service). You come up with demographic and psychographic data. Demographic data are statistical data related to a selected group which include the gender, age, location, education, income, and other personal data. Psychographic data pertain to general or common attitude, values, interests, personality, and other factors that impact the buying decision process for your product.
- Market segmentation
As your target market might be too huge or diverse to economically or profitably cover, you may want to focus on a particular niche or segment which you can effectively and efficiently serve.
- Market segment data
You compile statistics about your selected market segment such as size and growth trend (past and projected), the external environment that impacts the industry, opportunities, and threats.
As mentioned in our recent article, this involves knowing the strengths and weaknesses of your top current and potential competitors. Knowing these will enable you to explore ways of neutralizing their strengths and taking advantage of their weaknesses.
You may want to determine how competitive the industry or market you will be entering. You should consider the number and strength of potential buyers and suppliers, the presence of substitute products, ease or difficulty of market entry, and other factors affecting the level of competition. The degree of competitive rivalry directly affects the profitability of your market.
As discussed in a recent blog, it is crucial to the success of your business how you will develop comparative advantage (cost-wise) and/or differential advantage (differentiation-wise). Without a competitive advantage, you cannot expect your business to be above the competition. You manifest your competitive advantage in your value proposition.
How do you want your target market to perceive your product and company? Do you want them to see your product as having a high quality, or as being the lowest priced in the market, or your company as having the best customer support? Or you simply want to convey that your product and company offer superior value to its customers.
To be clear and effective in reaching out to your target market, you create your brand. Your brand represents everything about your product and company. You develop your brand identity, story, positioning, and messaging. Your brand delivers your value proposition to your target market. Building a strong brand not only results in a successful marketing but in the long term adds immense value to your company.
Based on your marketing objectives, evaluation of your target market segment, competition, your value proposition, your market positioning, and branding, you decide on the following courses of action:
You develop a product that best fits the needs of your target market. It should effectively deliver solutions to their problems or eliminate their pain points.
This is important, particularly in your launching stage. Either you use low pricing to penetrate a competitive market and establish a foothold, or maximize profit if you have a strong product differential advantage or you operate in a low-competition market.
Promotions strategy – online or offline
You may choose to use either online or offline promotions strategy. Your decision will be based on cost-effectiveness in reaching out to your target market.
Distribution strategy – online or offline
You decide on the best option of delivering your products to your target market. Would your customers prefer ordering, paying, and receiving your product via online transactions or would they prefer going to a brick-and-mortar store to physically examine, try, and evaluate your product?
These are key tactical activities that have to be identified and implemented to put into motion the various marketing strategies on a day-to-day basis.
You have to list your targets and measures for each of the tasks you have outlined. These are your performance standards against which you will measure or assess results at the end of each evaluation period – monthly, quarterly, and annually.
You identify who will be responsible for delivering the necessary results.
Prepare a marketing budget that will adequately cover the various marketing activities required in your marketing plan. This will be the basis for determining the ROIs of your marketing efforts.
Enumerate milestones that should be achieved along a specific timeline.
This discussion is just going through briefly the various elements of a marketing strategy and a marketing plan to show how each of these marketing studies relates to each other. It is important to note that one cannot exist without the other.
For practical purposes, some entrepreneurs look at both studies as one and the same. Some marketing professionals would rather integrate these studies and call them a strategic marketing plan.
In whatever manner you look at these, what is important is you have clear marketing objectives, define your options and rationale in reaching these objectives, and identify how and when you will achieve these. You may seek expert advice in preparing your marketing studies.