Develop new products and services

New products and services are the lifeblood of all businesses. Investing in their development isn't an
optional extra - it is crucial to business growth and profitability.

But embarking on the development process is risky. It needs considerable planning and organisation.

This guide will outline the key stages in the lifecycle of products and services so you know when the
time is right for your business to start the development process.

It will explain how a planned and phased development process will help you make the wisest
investment and budgeting decisions. It will also advise you on how best to create a development team
and manage a project.

 The lifecycle of products and services

 Developing your ideas
 Match products and services to market needs
 Pricing your proposed service or product
 The project development process
 Creating a project team
 Investment and cost control
 Manage a development project

The lifecycle of products and services

There are five key stages in the lifecycle of any product or service.

Development - at this point your product or service is only an idea. You're investing heavily in
research and development.

Introduction - you launch your product or service. You're spending heavily on marketing.

Growth - your product or service is establishing itself. You have few competitors, sales are growing
and profit margins are good. Now's the time to work out how you can reduce the costs of delivering
the new product.

Maturity - sales growth is slowing or has even stopped. You've been able to reduce production and
marketing costs, but increased competition has driven down prices. Now is likely to be the best time
to invest in a new product.

Decline - new and improved products or services are on the market and competition is high. Sales
fall and profit margins decline. Increased marketing will have little impact on sales and won't be cost-
effective unless new markets are identified.

Manage the lifecycle

Identifying where products or services are in their lifecycle is central to your profitability. Effective
research into your markets and competitors will help you do this. See our guide on how to understand
your competitors.

You can extend the lifecycle of a product or service by investing in an "extension strategy". You could:
 increase your promotional spending
 introduce minor innovations - perhaps by adding extra features or updating the design
 seek new markets

But ultimately this only delays a product or service's decline.

Ideally, you should always have new products or services to introduce as others decline so that at
least one part of your range is showing a sales peak.

Developing your ideas

There's a lot at stake when developing a new product or service. To minimise risks and allocate
investment and resources wisely, you should consider a number of factors:

 Will your new product or service meet customers' specifications? For example, consider its design,
ease of use and performance benefits.
 How technologically feasible is the product or service? Can you meet the design, resource and
manufacturing requirements?
 Are you clear about what you hope to achieve with the new product or service? Does it meet the
strategy outlined in your business plan and play to your business' strengths?

The clearer you are about your plans, the better you can analyse the risks involved.

The following tips may also be helpful:

 consult members of your team about your development plans - they may contribute insights that
you've overlooked
 seek the views of suppliers and other business associates - their specialist expertise could be
invaluable
 test lots of ideas at the start of a project - it costs relatively little to assess which are most promising,
but make sure you stop work on ideas that don't meet your criteria before committing a lot of time and
resources
 ask your best customers what they think of your plans
 consider the regulatory framework within which your new product or service will operate
 don't overlook the environmental impact of your plans
 look beyond a new product or service's immediate potential and consider the longer term

Match products and services to market needs

New products and services have to offer benefits that meet your customers' needs. You need to
discover what these are.

Market research, using techniques such as surveys and focus groups, will help you do this.

Remember that although the end user of your product or service might be your most important
customer, you may have to take the needs of other parties into account.

For example, if you were planning a new DIY product, you would need to consider how retailers would
stock it as well as how it would benefit professional decorators. If you're creating a toy, you should
consider what parents as well as children will think of it.

Your competition
 Not only must you meet your customers' needs, you have to do so in a way that is better than the
alternatives offered by the competition.

Your new product or service needs a unique selling proposition - a feature or property that makes it
stand out in the marketplace. Before entering the market you need to determine:

 how customers needs are currently met

 why customers would choose your product or service rather than the competition's, both now and in
the future
 what risks you are prepared to take to launch your product or service into this market

To find out more, see our guide on how to understand your competitors.

Pricing your proposed service or product

Establishing a pricing strategy for a new product or service is an important part of the development
process. You should consider pricing the moment you decide to take an idea forward as it will
determine how much you can afford to invest in the project.

You will need to take the following factors into account:

 The benefits - or value - to the customer of your product or service compared with what the
competition has to offer. Will the price be one that customers are prepared to pay?
 Whether or not you're first to market. Is your product or service revolutionary or are you following a
market trend?
 The selling channels you want to use, which will affect your promotional spending and distribution
costs.
 The speed with which you want to establish your product or service.
 The expected lifecycle of your product or service.
 Whether you are covering your costs.

Strategic pricing can be used to drive sales and regulate demand. See our guide on how to price your
product or service.

The project development process

An effective development process for products or services should be divided into a number of key
stages:

 Idea generation - to capture new ideas.

 Idea distillation - to screen out those ideas not worth taking forward.
 Concept definition - to consider specifications such as technical feasibility and market potential. If
you're planning a new product, you should consider the design process now.
 Strategic analysis - to ensure your ideas fit into your business' strategic plans.
 Concept development - to create a prototype product or pilot service.
 Test marketing and finalising the concept - to ensure your product or service can be modified
according to customer, manufacturer and support organisations' feedback. This means deciding the
best timing and process for piloting your new product or service.
 Product launch - the trickiest stage. Before setting a date you must determine how to sell, promote
and support your product or service. Getting it right first time is essential. But any decisions to delay
your launch should be balanced against the danger that your competitors will beat you to market.
 In practice some of these stages may overlap, but the presence of a staged process will help keep
timing and costs under control.

Creating a project team

Every potential new product or service requires a dedicated development team.

In creating your team you need to include people with a variety of skills. For example, as well as a
creative ideas person you may also need a technical expert, a marketing specialist, someone who
can source components and someone who understands the supply-chain difficulties you could
encounter.

All team members should understand your business' objectives and be committed to them.

There are many forms of effective team working and the right one for you will depend on your
business' needs. For example, team members might:

 work as a unit dedicated to one project, reporting to a project manager

 work exclusively on one project but remain in separate departments reporting to department heads
who are under the project manager
 work on several projects at once with both a department head and project manager to monitor
progress

Teams need someone in a project management role to lead, co-ordinate and motivate the team.
See the page in this guide on how to manage a development project.

Investment and cost control

Developing new products and services is an inherently risky process. You must plan any investment
carefully and strictly control your costs.

You need to:

 factor any future investment in products and services into your strategic business plan
 plan exactly where this investment will be directed
 justify the expenditure on every project
 manage your costs

Before making investment decisions, consider how much your business stands to gain from a
completed product or service. Weigh this against the risks you face.

Phasing new product development

One way to minimise your risks is to phase investments in projects. By reviewing a project at the end
of each phase or stage of development, you can identify products or services that are unlikely to be
successful before resources are wasted. If the product or service fails to meet established criteria,
the project is ditched. If it meets them, resources sufficient to enable it to reach a next, predetermined,
stage are allocated.

Finding support

A range of government grants and tax breaks is available for research and new product development.
 Cost control

It's essential to keep a close eye on costs when you develop new products and services to avoid
them spiralling out of control. You should:

 estimate development costs in advance, as described below

 monitor expenditure throughout the development process
 introduce phased investment, as described above

There are two main ways to estimate costs:

 a top-down approach where you consider previous comparable projects and use them as a
benchmark
 a bottom-up approach where all team members agree on the costs they expect to incur with one
project manager, who will then estimate the total cost

Remember that your costs could include staffing, materials, technology, product design, market
research, prototyping and incremental overhead costs.

Manage a development project

Project managers are essential to ensure the successful development of new products or services.
They'll be responsible for:

 controlling costs and allocating resources - for further information, see the page in this guide on
investment and cost control
 drawing up the key parameters for the product or service's specification
 co-ordinating the product development team - for further information, see the page in this guide on
creating a project team
 timetabling the development process
 troubleshooting

Timetabling the development process

Your project manager should draw up a critical path for the completion of key tasks. SMART (specific,
measurable, agreed, realistic and time-limited) objectives can help to control and co-ordinate the
development team's advance along this path and stages can be used to monitor progress.

However, flexibility must be built into your plans. Any number of unknowns can come into play and
result in, for example, a change in the project's specifications or expected completion date.

Original document, Develop new products and services, © Crown copyright 2009
Source: Business Link UK (now GOV.UK/Business)
Adapted for Québec by Info entrepreneurs

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(gov.uk/business) and Québec-based (infoentrepreneurs.org) businesses. Because of its general
nature the information cannot be taken as comprehensive and should never be used as a substitute
for legal or professional advice. We cannot guarantee that the information applies to the individual
circumstances of your business. Despite our best efforts it is possible that some information may be
out of date.
 As a result:

 The websites operators cannot take any responsibility for the consequences of errors or omissions.
 You should always follow the links to more detailed information from the relevant government
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How do you write a marketing plan for a new product?

Are you sure you want to logout?
1. Use These 5 Steps to Create a Marketing Plan.
2. Step 1: Take a snapshot of your company's current situation.
3. Step 2: Define who your target audience is.
4. Step 3: Make a list of your marketing goals.
5. Step 4: Research marketing tactics.
6. Step 5: Set your marketing budget.

10 Ways to Promote a New Product or Service

If you’ve ever come out with a new product or service, you know how tough it can be to get the word out.
You could be offering the best new product or service in the world, but if you don’t promote it properly, you
may end up losing money down the line. Here are some creative ways to promote a new service or product
for your small business.

How to Promote a New Product or Service

When it comes to promoting a new product or service for your business, it can seem like there are endless
options. It can be difficult to figure out where to get started and which methods of promotion will give you the
best results. The truth is that there are many ways to promote your business, and what works may depend on
your business. Here are 10 ways to promote a new service or product for your business.

1. Post to Google My Business

You can post about your new product or service to Your Google My Busines profile in two ways. The first is
to create a Google post and choose the “promotion” option. The second is to upload photos of the new product
or service to your profile. For help, check out Tip for Adding Photos to Your Google My Business Profile.
If applicable, you might even want to post some FAQs on the new product or service. To learn more, head to
How to Post FAQs to Your Google My Business Profile.

2. Offer Customers an Exclusive Preview

Your loyal customers are a key part of how to promote your product, because they are most likely the first ones
who will buy it. Offer customers an exclusive preview of your new product. This can take the form of a private,
pre-launch party, an online preview, or a special invitation to test out your latest service. These exclusive offers
to loyal customers will make them feel good and keep them coming back.

3. Social Media Contests

Contests, giveaways, and sweepstakes are a very popular tool among top quality marketers. Why? Marketers
know that social media contests work!

Social media contests are a fun, easy way of connecting with customers and bringing in more fans for your
social media platforms. A simple Facebook contest for example, garners 34% new fans on average per
campaign. That’s huge considering that organic reach is low on Facebook!
Instagram giveaways give customers an exclusive chance to be the first person to get their hands on your new
product—for free! The giveaway can be marketed all across your social media channels and through email. Run
an Instagram giveaway to get more direct traffic, put your business in front of new customers, and for a fun
way to connect with fans.
Related eBook: Examples of Facebook Contests and Instagram Giveaways (free PDF)

4. Email Marketing

Did you know that 82% of consumers open emails from businesses, and that 44% of email recipients made at
least one purchase last year based on a promotional email? Email marketing via newsletters is a fantastic vehicle
for advertisement, and is one of the best ways to promote a new service or product.
Email newsletters allow you to easily share news of your product, photos, and information with customers.
From there, offering an exclusive discount or promotion is a great way to “seal the deal” so to speak, and get
cash flowing your way. For more ideas, check out this post on email newsletter topic ideas.

5. Facebook Ads

With 1.44 billion monthly active users, Facebook is a window to a huge market. That’s why Facebook ads are
an effective marketing tool. Facebook is particularly useful in concisely targeting your audience, as Facebook’s
impressive data collection allows businesses to target by gender, age, location, interest, and more. You also
have an array of options for the type of ad you want, and you can easily stick to your budget by creating a cap
on how much you want to spend daily or monthly.

6. In-Store Promotions

Businesses with brick and mortar locations have the added opportunity to promote a new product or service in-
store. If you want to know how to promote your product in your studio or store, the #1 thing you need to do is
to give people a reason to go to your store.
Aside from having attractive logos and signage, you can promote your new product or service in store with
signs and promotional materials inside. Offer exclusive in-store discounts, such as a buy-one-get-one-free or a
percentage discount. You could also market your product as being exclusively available at your retail store.
Whatever your promotion, be sure to emphasize that it won’t last forever. Customers whose purchase power is
limited, either by time or inventory, feel a more pressing sense of urgency to buy when it comes to your product.

7. Host an Event

Another way to get people to your physical location is to host an event or an open house at your business.
Hosting an event is a great way to get people physically into your business, which makes them more likely to
become a customer. Events don’t have to be fancy and super organized; something as simple as an open house
or an info session will work for locations like salons, fitness centers, yoga studios, spas, and retail stores.
If your business is in a location with other local businesses, you can work together to have a sidewalk sale or
outdoor open house to draw even larger crowds! This is a great way to promote a new product or service that
you’re offering.

8. Offer an Upgrade or Trade-In

If your business is more service-based than product-based, like a salon, spa, fitness center, or consulting
business, you can offer an upgrade for customers to try out your new service. Offering a new facial or massage
at your spa? Provide a complimentary upgrade for existing customers to try it out! Expanding your consulting
services? Offer expanded services to loyal clients so they can see the difference!

If your new product is, in fact, an upgrade on an older one, you can consider crafting a trade-in promotion.
Trade-in promotions are proven to be effective because they incentivize consumers to buy a new product using
a token or credit they already have (the product they own). You can also resell the old trade-in products,
provided they are in good enough condition, or use them for future giveaways.

9. Share Customer Reviews

One of the best ways to promote a new product or service is to let your customers speak for you by sharing
reviews. If you take advantage of some of the ideas previously mentioned and offer an upgrade or free preview
to customers, ask them to review the new service or product online or to provide a testimonial for you to share.
People will be more likely to sign up or try it out if there’s a glowing review from another customer.

10. Share on Social Media

Another way to promote new products and services is to announce and share this on social media. If you’re
using the tactics mentioned above, make sure to share any of them on social media, including: customer
exclusive events, open houses, trade-in or upgrade opportunities, giveaways, customer reviews. and photos. If
you find that customers are posting on social media sites like Facebook and Instagram, make sure to share those
photos with your own followers to entice people to try out your new service or product!
If you’ve got a new product or service that you’re looking to promote, try out one of these 10 methods of getting
the word out.

Marketing Tips for Launching a New Product

So you want to bring a new product or service to market. You've done your homework and decided exactly
what you plan to offer; now all you need to generate is sales. Sounds simple enough, doesn't it? But every day,
countless new product and service ideas are conceived--never to be born because they're not properly brought
to market. In fact, a large percentage of the calls my company's coaches receive are from small-business owners
who want exactly this sort of help. And we carefully guide them through these seven important steps that will
help them successfully bring their new products and services to market.

1. Study your competition. Many business marketing classes teach participants how to perform a SWOT
(strengths, weaknesses, opportunities and threats) analysis. You have to start by taking a serious look at your
competitors. Make a list of the businesses that offer products or services similar to the one you plan to launch.
Even if you think your new product or service is entirely unique and without existing competition, it's important
to put yourself in your prospective customers' shoes and imagine what they might buy in lieu of what you plan
to offer. Once you decide whom your competitors will be, review their marketing materials, including their ads,
brochures and websites. Evaluate how your new product or service will stand up against what's already being
offered, in what ways you'll excel, and which companies or their offerings pose the greatest threats to your
success.
2. Target the ideal customer. To successfully launch your new product or service with minimum financial
outlay, it's essential to focus exclusively on the prospects you believe are most likely to purchase from you.
These may be customers who are currently buying something similar and will appreciate the additional features
your new product or service provides. Your best prospects have a perceived need for what you offer, can afford
to buy it and have demonstrated a willingness to do so--probably by purchasing from your competition. Bear in
mind, it's always easier to fill a need than to create one.

3. Create a unique value proposition. At this stage, you should have a clear understanding of what you must
offer in order to stand apart from your competition and who will want to take advantage of your offer. But do
you know why customers will want to buy from you vs. the vast field of competitors out there? What benefits
and features will you provide that your prospective customers will value most? The bottom line is that your
product or service "bundle" should be unique and meet the needs and desires of your best prospects.

4. Define your marketing strategy and tactics. Next, choose your sales and marketing channels. Will you
market online, via catalog or through dealers, for example? Generally, multichannel marketers achieve the
greatest success because customers who can shop when and however they like tend to spend more and shop
more often. Suppose your strategy is to market a low-cost workout device to people who can't afford gym
memberships or high-priced home equipment. You might choose traditional direct marketing plus online sales
as your primary channels, and employ tactics including direct-response TV spots and online ads and e-mail
solicitations that link to your website.

5. Test your concept and marketing approach. With all the money it takes to bring a new product or service
to market, it's foolhardy to rush headlong into the launch phase prior to testing. What should you test? It's best
to examine your product or service bundle plus your marketing message and you're your marketing materials.
Depending on what you plan to market and your budget, you can use formal focus groups (or simply host
roundtable discussions with members of the target audience), employ online research or mall intercept studies,
or distribute your product to a select group of users for testing. Only after testing is complete, should you
proceed to the final creation of your marketing tools and materials.

6. Roll out your campaign. Public relations often plays a vital role in the launch of a product or service. You
can use media relations tactics to place articles and win interviews, get coverage by allowing key press to review
your product, hold a launch event, or use grass roots marketing to build buzz. But no matter what publicity
route you choose, first make sure your product or service is completely ready and available for purchase in
order to maximize returns from the coverage you receive. And your other marketing efforts should follow
closely on the heels of your press roll out. Monitor the results from all media, and in the first weeks and months,
be prepared to adjust your campaign to take advantage of what's working best.

7. Know your product's lifecycle. The campaign you use during the introduction and education phase of your
product or service launch will need to be updated as your product or service matures. If you're monitoring your
marketing results carefully, you'll begin to see diminishing returns that will indicate when it's time to revise the
product or service itself, alter your media message, or even phase out this particular offering and lay the
groundwork for the launch of your next great idea.

Five Critical Steps to Developing a Marketing PlanMarketers have a saying: “If you don’t know where you’re
going, any road will take you there.” Without planning and a sound strategy, how can you know where you are
going or what you need to do to get there? Here are five steps to develop your marketing plan. For a more
detailed reference, check out our ebook,

Step 1: Define Your Business Goals

A sound marketing strategy aligned with your highest-level business goals and objectives helps you create
awareness for your company and its products and services, drive website traffic and leads, and generate new
sales opportunities that meet your company’s target audience profile.
With your goals and objectives in place, you have more insight into what you need to build a marketing strategy,
develop an action plan, and define how to measure results.

When developing goals (at the business level or otherwise), write them in the SMART format that ensures
accountability. SMART stands for Specific, Measurable, Attainable, Realistic, and Time-bound and represents
business goals such as:

 Increase product line revenue by 30 percent to $2 million in the next 12 months

 Double revenue through distributors in the next two years
 Increase profitability from 25 to 30 percent by the end of the year

Step 2: Conduct a Marketing SWOT and Set Goals & Budget

Ultimately, you want marketing that provides a consistent flow of high-quality leads to help fuel new sales
opportunities and drive growth. You want your technical target audiences and customers to be happy to hear
from you and not dread it. And you have a limited budget and tight bandwidth.

The way to achieve all of this is to use a smart marketing approach that builds a marketing strategy and execution
plan aligned to your business goals and starts with:

 A SWOT of your current marketing program - strengths, weaknesses, opportunities, and threats in
terms of your competitive position, target markets, target audiences, current positioning/messaging,
the maturity of your offerings, channel partners, etc.
 Up to 5 SMART goals for the next 12 months, such as
o Grow leads by 10 percent on a flat budget by shifting marketing dollars from outbound to
inbound channels
o Increase the number of qualified opportunities passed to sales by
15 percent
o Triple the number of published customer case studies in the top three segments
 Marketing resources and budget - a rule of thumb for spending on marketing is 4 percent to 12 percent
of gross revenue with higher spending in the early phases as you establish your marketing foundation.
 With your business and marketing goals defined and aligned, you are now ready to create your marketing
execution plan

Step 3: Define Your Target Personas

You probably know the profile of your most valuable prospects and the sales process your company uses to
convert them from leads to opportunities to customers. However, as your company grows, you won’t know
each prospect’s unique situation, and one message won’t work for all. You’ll need to customize your marketing
approach by creating buyer personas.

Buyer personas are fictional representations of your ideal customers based on demographic data, online
behavior, and your educated speculation about personal histories, motivations, and concerns. For example, you
may define one of your personas as VP of Engineering Vince, a business executive who cares most about cost
and long-term support. A second persona could be Engineer Elliot, an engineering manager or senior staff
engineer who is an expert in your technology area and wants to do a deep dive into the technical capabilities of
your product or how you deliver a service. Elliot greatly influences Vince, but Vince makes the final decisions.
Vince and Elliot have very different concerns.

The first step in creating your buyer personas is to brainstorm who they could be. Once you have your full list,
identify the ones who have similar needs or roles and consider merging them. From here, prioritize your list of
personas by considering their impact on the final purchase decision, their relationship to your company, and the
size of the audience persona group. Once you’ve finished brainstorming, create your actual personas.
Here's an example of a buyer persona to help give you an idea of how to develop your personas.

Step 4: Create Your Execution Plan

Now that you’ve created your marketing goals and have a budget, you are ready to develop your activity plan,
also known as a marketing communications plan. The most effective way to approach turning your marketing
strategy into an execution plan is by using a campaign structure. You can think of campaigns as buckets of
activities focused on a common theme or goal.
With limited time and budget, a campaign approach gives you the big picture before you get into the weeds of
which new video you will produce, which white paper you will write and promote, etc.

Campaigns can run the gamut in scope. They can be anything from a major product launch to building thought
leadership in a particular segment to increasing web traffic and leads. Here are two examples of marketing
campaigns and their stated goals and KPIs:

Campaign—Lead generation and conversion

 Description—Through content and partner co-marketing, attract quality leads that convert to
opportunities
 KPI 1—Increase leads by 35 percent to 210 per month
 KPI 2—Increase lead opportunity conversion from 6 to 8 percent

Campaign—Partner marketing

 Description—Develop and implement a channel co-marketing program

 KPI 1—Publish at least one lead-generating piece of co-branded content per quarter
 KPI 2—Generate 100 net new leads through co-marketing activities

Step 5: Organize and Measure

As a last step, you need to define marketing team roles, determine the timeframe in which you want to achieve
results, and document the expected return of time and dollars invested. The organizational structure, pace, and
outcomes should be part of your marketing plan, and you should review this plan quarterly and annually to
ensure optimal use of limited resources for maximum output.

Though each company organizes its marketing team based on its unique culture, budget, and expected
outcomes, you can choose from three general approaches to take: do-it-yourself (DIY), in-house, or
outsourced. Each one has pros, cons, and cost variations to consider and thoroughly evaluate before making
the best choice for your company. Often, the ideal approach is a hybrid one that optimizes existing resources
and areas of expertise (such as technical content development) and focuses outsourced efforts on marketing
gaps.

In terms of measurement, I recommend a marketing dashboard featuring the most important metrics that define
marketing success for you. These metrics will likely come from multiple areas, including your funnel metrics
(leads, opportunities, etc) and your campaign KPIs, and will indicate whether you are on track to achieve the
marketing goals and objectives you defined in your strategy. Just as a car dashboard has indicator lights for
low fuel or high speed, the metrics you include in your marketing dashboard should serve as these indicator
lights, or warning signals, for marketing success. For your marketing dashboard, select these key metrics and
add the monthly objective for each. Then, each month, add the actual results for each metric and consider an
easy “indicator light” system such as highlighting each metric result red, yellow, or green based on whether
they are below target, on target, or above target.
Here's an example marketing scorecard.

How to Write a Great Business Plan: Sales and Marketing

The sixth in a comprehensive series to help you craft the perfect business plan for your startup.

By Jeff HadenContributing editor, Inc.@jeff_haden

SHUTTERSTOCK
This article is part of a series on how to write a great business plan.

Providing great products and services is wonderful, but customers must actually know those products and
services exist. That's why marketing plans and strategies are critical to business success. (Duh, right?)

But keep in mind marketing is not just advertising. Marketing--whether advertising, public relations,
promotional literature, etc--is an investment in the growth of your business.

Like any other investment you would make, money spent on marketing must generate a return. (Otherwise why
make the investment?) While that return could simply be greater cash flow, good marketing plans result in
higher sales and profits.

So don't simply plan to spend money on a variety of advertising efforts. Do your homework and create a smart
marketing program.

Here are some of the basic steps involved in creating our marketing plan:

PUBLICIDAD

 Focus on your target market. Who are your customers? Who will you target? Who makes the
decisions? Determine how you can best reach potential customers.
 Evaluate your competition. Your marketing plan must set you apart from your competition, and you
can't stand out unless you know your competition. (It's hard to stand out from a crowd if you don't
know where the crowd stands.) Know your competitors by gathering information about their products,
 service, quality, pricing, and advertising campaigns. In marketing terms, what does your competition
do that works well? What are their weaknesses? How can you create a marketing plan that highlights
the advantages you offer to customers?
 Consider your brand. How customers perceive your business makes a dramatic impact on sales. Your
marketing program should consistently reinforce and extend your brand. Before you start to market
your business, think about how you want your marketing to reflect on your business and your products
and services. Marketing is the face of your to potential customers--make sure you put your best face
forward.
 Focus on benefits. What problems do you solve? What benefits do you deliver? Customers don't think
in terms of products--they think in terms of benefits and solutions. Your marketing plan should clearly
identify benefits customers will receive. Focus on what customers get instead of on what you provide.
(Take Dominos; theoretically they're in the pizza business, but really they're a delivery business.)
 Focus on differentiation. Your products and services have to stand out from the competition in some
way. How will you compete in terms of price, product, or service?

Then focus on providing detail and backup for your marketing plan.

Key questions to answer:

 What is your budget for sales and marketing efforts?

 How will you determine if your initial marketing efforts are successful? In what ways will you
adapt if your initial efforts do not succeed?
 Will you need sales representatives (inside or external) to promote your products?
 Can you set up public relations activities to help market your business?

The Sales and Marketing section for our cycling rental business could start something like this:

Target Market
The target market for Blue Mountain Cycling Rentals is western VA, eastern WV, southwestern MD, and
northern NC. While customers in the counties surrounding the George Washington National Forest make up
35% of our potential customer base, much of our market travels from outside that geographic area.

Marketing Strategy
Our marketing strategy will focus on three basic initiatives:

 Road signage. Access to the forest is restricted to a few primary entrances, and visitors reach those
entrances after traveling on one of several main roadways. Since customers currently rent bicycles in
the local town of Harrisonburg, road signage will communicate our value proposition to all potential
customers.
 Web initiatives. Our website will attract potential visitors to the resort. We will partner with local
businesses that serve our target market to provide discounts and incentives.
 Promotional events. We will hold regular events with professional cyclists, like demonstrations and
autograph signings, to bring more customers to the store as well as to extend the athletes' "brand" to
our brand.

Pricing Strategy
We will not be the low-cost provider for our target market. Our goal is to provide mid- to high-end equipment.
However, we will create web-based loyalty programs to incent customers to set up online profiles and reserve
and renew equipment rentals online, and provide discounts for those who do. Over time we will be able to
market specifically to those customers.

Just like in the Market Opportunity section, you may want to include a few more categories. For example, if
your business involves a commission-compensated sales force, describe your Sales Programs and incentives. If
you distribute products to other companies or suppliers and those distribution efforts will impact your overall
marketing plans, lay out your Distribution Strategy.

The key is to show you understand your market and you understand how you will reach your market. Marketing
and promotions must result in customers--your goal is to thoroughly describe how you will acquire and keep
your customers.

Also keep in mind you may want to include examples of marketing materials you have already prepared, like
website descriptions, print ads, web-based advertising programs, etc. While you don't need to include samples,
taking the time to create actual marketing materials might help you better understand and communicate your
marketing plans and objectives.

Make sure your Sales & Marketing section answers the "How will I reach my customers?" question.

Next time we'll look at the next major component in a business plan: your Competitive Analysis.

More in this series:

1. How to Write a Great Business Plan: Key Concepts

2. How to Write a Great Business Plan: the Executive Summary
3. How to Write a Great Business Plan: Overview and Objectives
4. How to Write a Great Business Plan: Products and Services
5. How to Write a Great Business Plan: Market Opportunities
6. How to Write a Great Business Plan: Sales and Marketing
7. How to Write a Great Business Plan: Competitive Analysis
8. How to Write a Great Business Plan: Operations
9. How to Write a Great Business Plan: Management Team
10. How to Write a Great Business Plan: Financial Analysis

6 Ways to Convince Customers to Buy

You'll sell more if you talk about your product using language your customer understands.

By Geoffrey JamesContributing editor, Inc.com@Sales_Source

GETTY IMAGES
Customers never buy because of product features. They buy because they perceive some "benefit" to those
features.

Unfortunately, most sales and marketing messages talk about features and let the customers try to figure out the
benefits. That's asking your customer to do your heavy lifting for you.

You'll get more customers, more quickly, if you communicate the benefits of using your product rather than the
features it possesses. Here are six rules for doing so, based upon a conversation with one of my favorite sales
gurus, Barry Rhein:

1. Know the difference between a benefit and a feature.

A feature is something that a product or service "is" or "does." A benefit is something that the product or service
"means" to the customer. For example:

 Wrong: "This car has a reinforced safety roof." (feature)

 Right: "This car keeps your family safe." (benefit)

2. Use vivid but plain language.

Customers will remember a benefit longer and more easily if it's expressed using simple, strong words that
evoke emotion.

 Wrong: "This roof provides protection in the event of a rollover accident."

  Right: "If this car rolls, there's a good chance you'll walk away unharmed."

3. Avoid biz-blab and jargon.

Nothing leaches a benefit of emotion more than the use of tired business cliches or overly technical terminology.

PUBLICIDAD

 Wrong: "Robust implementation of 80210 protocols!!!"

 Right: "You can connect virtually anywhere."

4. Keep the list of benefits short.

Most people can only hold two or three thoughts at one time in their short-term memory. Long lists of benefits
just cause confusion.

 Wrong: "Here are the top 10 benefits of using our product:"

 Right: "The two most important things to remember are..."

5. Emphasize what's unique to you or your firm.

Benefits that are generic to your product category can convince a customer to buy... but not necessarily from
you! Use benefits that differentiate you from the competition:

 Wrong: "Our software makes you more productive."

 Right: "Our customers report an average 30% decrease in costs, about twice the industry average."

6. Make your benefits concrete.

Customers ignore benefits that are abstract and expressed using vague adverbs and adjectives. Benefits that are
concrete and specific are more convincing and "stick in the mind."

 Wrong: "We can radically reduce your inventory costs."

 Right: "We decrease inventory costs by an average of 25%."