The Niche Marketing Blog

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Strategic Marketing Planning Made Simple – The 4P Business Thinking System

Business

Business (Photo credits: www.roadtrafficsigns.com)

[Editor’s note: Niche marketers – especially those who own or mange smaller businesses – tend to overlook the value of strategic and market planning. Part of the reason is lack of resources (e.g. time, personnel, etc.) and part of the reason is that the process can become overly complex.

The following article describes a simplified methodology for developing a strategic plan for the smaller niche business. Let me know what you think. Have you ever developed a strategic or marketing  plan for your business? If so, how did the process work out for you?  ~Scott]

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By Gogo Erekosima

An effective strategic marketing planning framework is a must-have element for any small business that wants to become a big business “when it grows up”. Unfortunately, many small business owners have as much interest in strategic marketing planning as a turkey has for thanksgiving. They avoid it.

Part of the reason why they avoid this very important process is because consultants and MBAs have conspired to make it a topic that only egg heads could love.

In working with my consulting clients, I have developed a simple framework for helping the every day business owner articulate a plan for strategic engagement with the marketplace. I call it the 4P Business Thinking framework.

The 4P Business Thinking Framework is a robust system for matching your solution to the needs of a marketplace, and then communicating that match in a way that results in sales and profits. Here is a brief overview of the 4Ps of the 4P framework.

1. People (or Profile)

For you or your business to exploit a market opportunity or overcome an industry challenge, you must have a very clear definition of the target customer. In the B2B (business-to-business) space that customer may be an organization, but the approach must still be crafted with individual decision makers in mind. In a B2C (business-to-consumer) context, you may have to define the demographic, psychographic or geographic profiles of your target prospects.

2. Problem

You must clearly define the problem your marketplace is desperate to solve for which you have an answer. In business, many ships have crashed on the rocks of market indifference because a company manufactured a solution for which the market had no problem. The time proven approach to value innovation in business is to deeply examine the clearly identified challenges of the customer.

3. Process (or Product)

What is your particular way of solving the market’s challenge that differentiates you from every other competitor?

This 3rd P in the framework is where you have a chance to stand out from the crowd of competitors for solving the problem of your chosen target market. Your process or product must be meaningfully different.

4. Passion (or Personality) and Proof

This last element is often flubbed badly by small businesses who blindly emulate the sanitized and often colorless communications of much larger firms. One of the embedded advantages a small business has is the ability to be “personal” and to communicate passion to the marketplace.

One large company that successfully communicates passion and personality in marketing is Southwest airlines. As a result of their commitment to personality in business, they continue to be rewarded with some of the highest customer approval ratings in the domestic airline industry.

If you manage a manufacturer of colorless widgets, or a buttoned-down professional service firm, you cannot afford to pass up the power of personality, passion and social proof in your marketing.

Some simple things you can do include digging through early stories of your company for narratives that may resonate, or capturing the experiences of your staff, clients and managers for your marketing campaigns.

Conclusion

Whether you’re planning for a new product or service, approaching a new target market or writing a direct mail sales letter, the 4P framework can be used to create tremendous value in your marketing planning process.

Gogo Erekosima, The Small Business Digital Coach is the CEO and Lead strategist at Idea Age Consulting – a Denver Business Consulting firm that promises to grow your small business by 24% or more in 24 weeks or less using their customized Business Growth Action MAPS.

Sign up today for a Marketing SWOT Analysis. This consulting module uncovers strategic marketing and business growth opportunities. This Consulting Package is valued at over $1500 dollars.

Article Source: Strategic Marketing Planning Made Simple – The 4P Business Thinking System

 

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Marketing Planning – Don’t Do SWOT

[Editor’s note: In both strategic, and market, planning processes, I have used the SWOT analysis on several occasions, and with much success. However, the author of this article does bring up several valid points regarding the shortcomings, and potential hazards, of the SWOT process. I have found that, the smaller the business, the less effective SWOT becomes. What are your thoughts? Have you ever used a SWOT analysis in your marketing (or niche marketing) planning? Feel free to share your thoughts here. ~Scott]

Swot analysis

Swot analysis (Photo credit: Wikipedia)

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SWOT (Strengths, Weaknesses, Opportunities, Threats) is a popular framework for developing a marketing strategy. A Google search for “SWOT” and “planning” turned up almost 93,000 hits (August 2004), most all of which laud the use of SWOT. Some students have said that it is the most important thing they learned at the Wharton School.

Although SWOT is promoted as a useful technique in numerous marketing texts, it is not universally praised: One expert said that he preferred to think of SWOT as a “Significant Waste of Time.”

The problem with SWOT is more serious than the fact that it wastes time. Because it mixes idea generation with evaluation, it is likely to reduce the range of strategies that are considered. In addition, people who use SWOT might conclude that they have done an adequate job of planning and ignore such sensible things as defining the firm’s objectives or calculating ROI for alternate strategies. I have observed this when business school students use SWOT on cases.

What does the evidence say? Perhaps the most notable indication is that I have been unable to find any evidence to support the use of SWOT.

Two studies have examined SWOT. Menon et al. (1999) asked 212 managers from Fortune 1000 companies about recent marketing strategies implemented in their firms. The findings showed that SWOT harmed performance. When Hill and Westbrook (1997) examined the use of SWOT by 20 companies in the UK in 1993-94, they concluded that the process was so flawed that it was time for a “product recall.”

One advocate of SWOT asked: if not SWOT, then what? Borrowing from corporate strategic planning literature, a better option for planners is to follow a formal written process to:

 

  1. Set objectives
  2. Generate alternative strategies
  3. Evaluate alternative strategies
  4. Monitor results
  5. Gain commitment among the stakeholders during each step of this process.

 

I describe this 5-step procedure in Armstrong (1982). Evidence on the value of this planning process, obtained from 28 validation studies (summarized in Armstrong 1990), showed that it led to better corporate performance:

 

  • 20 studies found higher performance with formal planning
  • 5 found no difference
  • 3 found formal planning to be detrimental

 

This support was obtained even though the formal planning in the studies typically used only some of the steps. Furthermore, the steps were often poorly implemented and the conditions were not always ideal for formal planning.

Given the evidence, SWOT is not justified under any circumstances. Instead, use the comprehensive 5-step planning procedure.

References

Armstrong, J. S. (1982) “The Value of Formal Planning for Strategic Decisions,” Strategic Management Journal, 3, 197-211.

Armstrong, J. S. (1990), “Review of Corporate Strategic Planning,” Journal of Marketing, 54, 114-119.

Hill, T. & R. Westbrook (1997), “SWOT Analysis: It’s Time for a Product Recall,” Long Range Planning, 30, No. 1, 46-52.

Menon, A. et al. (1999), “Antecedents and Consequences of Marketing Strategy Making,” Journal of Marketing, 63, 18-40.

The two papers (cited in this article) written by me can be found in full-text at http://www.jscottarmstrong.com

 

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