Module 3: The

Marketing Plan
Business Plan
 Is a comprehensive paper that details
the situation analysis, objectives,
strategies and tactics, and how to
monitor and control the enterprise.
MARKETING PROCESS
Marketing is all about knowing
the CUSTOMERS.
Marketing process starts with identifying the
customers’ needs where you are tasked to create a
meaningful value proposition. Next, you study what
the customers’ want or desire for you to build a
unique selling proposition. From there, it is imperative
to identify the most strategic market or group to tap.
A. Value Proposition (VP) and Unique
Selling Proposition(USP)
VALUE PROPOSITION (VP)
 statesWHY A CUSTOMER SHOULD BUY a certain
product or service.
 The entrepreneur should bear in mind that a value
proposition has to be direct in addressing the
problems of the customers, should have
quantifiable benefits, and should differentiate itself
from the competitors.
…Value Proposition (VP) and Unique
Selling Proposition(USP)

UNIQUE SELLING PROPOSITION (USP)

 Refers to HOW YOU WILL SELL the product or service
to your customers.
 After you create your VP, you have to figure out
how to advertise or promote certain unique
features of the product or service that you’re trying
to sell.
Tips on How to Create an Effective USP to
Target Customers

1. Identify and rank the uniqueness of the product or

service attribute.
2. Be very specific.
3. KISS (Keep it short and simple).
B. KNOW YOUR CUSTOMERS
Marketing Research
 Is a comprehensive process of understanding the
customers’ intricacies and the industry they revolve
in.
 It aims to scrutinize the target market, their specific
requirements, and the market size where the
business operates.
Market Size
It
is the size the arena where the
entrepreneur’s business will play.

It
is the approximation of the number of
buyers and sellers in a particular market.
Steps in Conducting a Strategic
Marketing Research
1. Estimate the Potential Market (Market
Space/Market Universe) – the approximate
number of customers that will buy the product or
avail the service.
2. Eliminate the customers who are unlikely to buy
the product or avail the service.
3. Estimate the market share.
B. CUSTOMER REQUIREMENTS

 They are specific features and requirements that

the customers need from a product or a service.
 Entrepreneurs must know WHO buys,, and WHAT,
WHEN, WHERE, HOW, and most importantly, WHY
they buy.
 They should also be vigilant with the constant
change in customer requirements.
C. PRIMARY AND SECONDARY TARGET
MARKET
Market Intelligence – includes customer profiling,
drives the entrepreneur on what correct strategies
and tactics to employ.

Market Segmentation – is the process of grouping

similar or homogeneous customers according to
demographic, psychographic, geographic, and
behavior.
…c. primary and secondary target
market

Secondary target market – are customers who don’t

have enough purchasing power or have fewer
demands. They may not be your primary target
market, but they can be converted once effective
marketing strategies are implemented.
Market Segmentation
1. Demographic
 Also called as socioeconomic segmentation.
 It is the process of grouping customers
according to relevant socioeconomic variables
for the business venture which include income
range and social class, occupation, gender
and age, religion, and ethnicity.
…market segmentation
2. Psychographic
 It
is the process of grouping customers
according to their:
a. Perceptions
b. Way of life
c. Motivations
d. Inclinations
…market segmentation
a. Perceptions – process wherein an individual
receives external stimuli using the five senses.
b. Way of life
c. Motivations
 Physiological– involve the needs of the person; they seek to
avoid pain and give pleasure
 Psychological – involve customer’s preferences

d. Inclinations – involves preferring one product over

another as a result of gaining refreshing
experience when using the product.
…market segmentation
3. Geographic
 Itis simply grouping customers according to
their location.
 Moreover, this is critical in the analysis of the
target market as this encompasses the cultures,
beliefs, preferences, politics, and lifestyle of a
certain geography besides from the location of
the target market.
…market segmentation
4. Behavioral
 It
is the process of grouping the customers
according to their actions.
 These behaviors are instigated by:
a. Occasions - Ex. Christmas season
b. Desired benefits – Ex. 3-in-1 coffee
c. Loyalty – is the result of maintain satisfied
customers.
d. Usage of products or availment of services –
describes how often a product is being used or
the service is being availed.
D. TALKING TO YOUR CUSTOMERS
The last step in marketing research is establishing a
market research design that will effectively implement the
other steps. Depending on the objective, responses are either
qualitative or quantitative.
1. Qualitative Research – includes identifying the written or
spoken opinions of customers
2. Quantitative Research – involves analyzing the customers’
preferences by using relevant statistics (such as those in
surveys).
…d. talking to your customers
I. The Interview
 It is a face-to-face contact between the
researcher/entrepreneur and a respondent where the
researcher asks pertinent questions that will give him
significant pieces of information about the problem that he
will solve.
 it is helpful even when the business has already started
because the customers’ feedback provide the
entrepreneur a glimpse of what customers think about the
business.
Two Main Types of Interviews
1. Unstructured Interview – an informal type of
interview and does not follow a specific set of
questions. The respondent can answer freely.
2. Structured Interview – employs a specific set of
questions and produces quantitative data. The
interviewer and the respondents to omit or add
questions, nor change the sequence or how the
questions are worded.
…d. talking to your customers
II. The Focused Group Discussion (FGD)
 It is a process of mining customer and noncustomer
experience and insights about a specific product or service.
 What’s unique about FGD is that it is led by a moderator
who keeps the discussion spontaneous and on the right
track.
 The participants, on the other hand, are selected based on
the objective of the entrepreneur and should be
homogeneous as mush as possible.
…d. talking to your customers
III. Observation
 It is one of the preferred and practical methods of
generating ideas because the researcher documents the
behavioral patterns of people or of objects or events
without necessarily requiring them to participate in the
research process.
 It is reliable because it allows the researcher to see the real
and actual behavior of customers rather than hearing what
they need to say
 This can be performed by either a human or machine
observer.
…d. talking to your customers
III. Observation
 This can be performed by either
a. Human Observer – record information as it occurs
or as it happens using his five senses.
b. Machine Observer – employs an equipment to
record the information needed
Examples of Human Observation
1. Customer purchase patterns – uses the researcher
to understand the buying behavior of the
customer.
2. Mystery Shopping – common practice of service
businesses today where the researcher pretends
he or she is a customer of his or her own business
or the competitor’s.
Examples of Machine Observer
1. Video Cameras or Closed-Circuit Television (CCTV)
2. Traffic counter – used to determine foot traffic or vehicular
traffic in a particular location. The researcher will be able
to determine where to sensibly install a tarpaulin, signage,
or bill board.
3. Web Analytics – online tool that tracks the performance of
Web site as to the number of its visitors, the contents they
usually access, and other information relevant to the web
site owner.
…examples of machine observer
4. Barcode Scanners – help researchers understand
the purchase behavior of the customers by
reading the product codes and generate
relevant sales information.
5. GPS Technology – allows tracking of vehicles and
pedestrians exposed to out-of-home
advertisements.
…d. talking to your customers
IV. Traditional and Online Surveys
 Itis the process of getting answers from a sample
of respondents derived from a particular
population.

 Questionnaires can be distributed and answered

verbally, by writing, or through the Internet.
In preparation for the survey, the
researcher must identify…
1. Sampling Techniques
a. Probability Sampling – technique wherein samples
are given equitable chances or nonzero chances of
being selected from a population.
b. Nonprobability sampling - does not give the
samples equal chances of being selected because
sample are instead selected according to their
accessibility or personal choice of the researcher.
…in preparation for the survey, the
researcher must identify…

2. Sample Size
3. Questionnaire Blueprint
E. THE MARKETING MIX: THE 7Ps OF
MARKETING

 Itis a widely accepted strategic marketing tool

that combines the original 4Ps (product, place,
promotion, price) with the additional 3Ps – people,
packaging, and process – in formulating marketing
tactics for a product or service.
…the marketing mix: the 7ps of
marketing
 The 7Ps are employed until the entrepreneur finds
the right combination that will most effectively
serve the customer’s needs and wants and at the
same time achieve the profitability objective.
 Entrepreneurs must use the 7Ps model to do the
following: conduct a situation analysis, set
objectives; conduct a SWOT analysis
The 7Ps of Marketing
 Product – What product/service is the most appropriate for
the opportunity, and why will customers buy or avail them?
 Place – What location is best suited for the business where
there are more potential customers? Can they conveniently
transact on-site or online? How is the process of distribution
of products or performance or services?
 Price – What is the most appropriate price, and what
pricing strategies will be used for the target customers?
 Promotion – What is the most effective advertisement or
combination of advertisements and which advertising tool
should be used to drive awareness and increase sales?
…the 7Ps of marketing
 People – What type of people need to be hired? What are
the basic skill needed for the job? What leadership style will
be applied by the entrepreneur?
 Packaging – What is the best packaging for the product
that is attractive enough to customers and cost-efficient at
the same time? What physical evidence does the
entrepreneur need to set up so as to sell the service?
 Processing – What is the most compelling feature of the
product or the business that will make a difference in the
lives of the customers? What sets the product or service
from the rest?
Product
 Itis any physical good, service, or idea that is
created by an entrepreneur or an innovator in
serving the needs of the customers and addressing
their existing problems.
 The three-level concept of products or services
summarizes the reasons that a customer decides to
buy a product or avail of a service.
…product
The Three-Level Concept of Products/Services
Level 1: Core Benefits of the Product or Service

Level 2: Physical Characteristics of the Product or Service

Level 3: Augmented Benefits of a Product or Service

(additional benefits)
Place
 Refers to a location or the medium of transaction.
 In a physical location, the entrepreneur must
research about the area’s population, the traffic,
the people’s common paths, their buying
behavior, and their preferences for the location
(e.g., Wi-Fi access, spacious area for parking)
 In a cyber location, the entrepreneur must use
Web analytics data to understand Web
performance.
…place
 Placecovers the product distribution and the
whole business logistics. The logistics side for
products should cover production, ordering and
receiving raw material or finished goods from the
suppliers, storage, reorder points, and
transportation systems.
Price
 It is the peso value that the entrepreneur assigns to
a certain product or service after considering its
cost, competition, objectives, positioning, and
target market.
 It is the only P in the 7Ps that generates revenue for
the business.
…price
Most Common Pricing Strategies
1. Bundling – refers to two or more products or services in one
reduced price.
2. Penetration Pricing – refers to setting low prices to increase
market share, but the entrepreneur will eventually increase the
price once the desired market share is achieved.
3. Skimming – this is the opposite of penetration pricing where the
prices are initially high and then they are lowered to offer the
product or service to a wider market.
4. Competitive Pricing – refers to benchmarking prices with the
competitors.
5. Product Line Pricing – refers to pricing different products or
services within a parallel product array using varying price
points.
…price
6. Psychological Pricing – this considers the psychology
and positioning of price in the market.
7. Premium Pricing– refers to setting a very high price to
reflect elitism and superiority.
8. Optional Pricing – refers to adding an extra product
or service on top of the original to generate more
revenue.
9. Cost-based Pricing – the basis of markup is the cost
of sales.
10. Cost Plus Pricing – the markup is based on a certain
percentage of cost.
…price
Two Classification of Costs

1. Variable Costs or Uncontrollable Costs – costs that are

directly proportional to the number of products
manufactured or to then number of services performed.

2. Fixed Costs or Controllable Costs – costs that are NOT

directly proportional to the manufacturing of a product or
to the performance of the service.
Promotion

 Itinvolves presenting the products or services to

the public and how these can address the public’s
needs, wants, problems, or desires.
 The main goal of promotion is to gain attention.
…promotion
Promotional Tools
1. Advertising – type of communication that influences the
behavior of a customer to choose the product or service of the
entrepreneur over the competitors.
2. Selling – this is the act of trading a product or service for a price
or a fee.
3. Sales promotion – these are short-term promotional gimmicks
wherein practical incentives and appealing activities are
incorporated to entice the customers to buy the product or
avail the service.
4. Public Relation – these are image-building initiatives of the
entrepreneur to make the name of the business reputable to
stakeholders, such as the target customers, government
agencies, business partners, media, and the public.
People
 In today’s marketing arena, people play a vital role in
servicing customers even though the entrepreneur sells only
physical goods.
 It is not just about the quality of the products anymore, but
how employee serve customer. Employees have become a
major influence in the customer’s buying behavior.
 Potential employees also need to be well-compensated
and provided with benefits.
Packaging
 It is how the product or service is presented to customers.
 It is the overall identification (look and feel) of the product
or service.
 Packaging preserves the shelf life of the product or service.
 Packaging’s ultimate goal is to entice customers to
purchase the product or service.
 In selling services, the term servicescape was used to refer
to the overall ambiance of the place where the service is
performed.
Process
 It is defined as a step-by-step procedure or activity
workflow that the entrepreneur or employee follow
to effectively and efficiently serve customer.
 Its components include input, throughput, and
output.
F. FUNDAMENTALS OF BRAND
MANAGEMENT
 Brand – refers to the identity of a company, of a product, of
a service, or of an entrepreneur himself or herself.
 The challenge for the budding entrepreneur is to
understand how to craft the brand, how to market this
brand, and how to make this brand deliver – these are the
entire message of brand management.
 Brand Management – is the supervision of the tangible and
intangible elements of a brand.
…f. fundamentals of brand
management
 Branding – is the process of integrating the strategies
formed from the marketing mix to give an identity to the
product or service.
Goals of Branding:
1. Establishing to target customers that the business is reliable
and trustworthy and that the product or service is the
superior solution to their current problem.
2. Differentiating with competitors
3. Driving customer loyalty and retention.
…f. fundamentals of brand
management
 To be different and catchy, a brand name must possess the
following characteristics:
 Unique
 Extendable
 Easy to remember
 Can describe the benefits of the product/service
 Can be converted to other dialects or languages in case the
entrepreneur expands to other territories
 Can describe a product category
 Can describe concrete qualities
 Positive and inspiring
Reference:
Batisan R. (2016). Entrepreneurship. Diwa Learning Systems, Inc.