Why a Marketing Plan?

by Doug Brown

Since 1985, many of the largest organizations of their kind in the world have tapped into Doug's consulting expertise and experience. As a management and sales consultant, Doug works side-by-side with an organization's senior executives and teams of thought leaders on issues of strategic importance. Together they quickly distill what strategies and tactics will be necessary to achieve their desired business results and metrics, whether via top line sales growth or bottom line profitability. Business leaders who relish intellectual stimulation and don't shy away from being asked 'tough questions' will get the greatest benefit as a result of working with Doug. Organizational leaders who are willing to question their own underlying assumptions and proactively embrace change truly appreciate his thought provoking approach. To stay grounded in reality, Doug insists that everyone bring all of their business acumen and common sense to the table. He then finds a way to leverage it to their collective benefit. As a result, they experience a tremendous return on their investment.

Marketing. What exactly is it? Simply put, it's everything a business does to attract customers/clients and keep them coming back and referring others to your business. But in order to 'market' your personal or commercial lines products and capitalize on your level of customer service, an effective marketing plan is necessary. It doesn't matter how great or wonderful your product or service is - without an effective marketing plan, you are doomed to stagnation or possible failure.

But before we focus on why your agency needs a marketing plan, it's important to point out that prior to writing the document, a company must also have a sound strategic plan. A well thought-out strategic plan is the most important tool for laying the groundwork for success. It can save thousands, of dollars in missteps and false starts in smaller companies and millions in larger organizations. In addition, it can prevent potential damage to an organization's reputation and image, which impacts both employee morale and customers' perception.

The strategic plan describes what your business is and intends to be, what you do and don't do, and what your ultimate goals are over the next three to five years and beyond. The operating plan or business plan typically covers a planning period of 12-24 months. It provides the environment for your marketing plan to flourish. Your marketing plan, however, focuses on change. Things change, employees leave, markets continue to evolve, customers come and go. Your marketing plan should be an ever-evolving document. It is a vital component of the overall strategic plan.

It is fairly common knowledge that a large majority of new businesses fail within two years. A large percentage never makes it past six months. Why? Most probably did not have an executable strategic plan. The owners/managers failed to invest the necessary time and effort. In fact, most business owners spend more time planning their vacation than planning their business! Yet when planning that vacation, you can be sure that entrepreneur had specific directions on how to get where he/she was going. A business isn't any different. Your strategic plan is your roadmap for your company. It defines where you are, how you got there, and how you plan to proceed.

Components of a successful strategic plan include:

• An Executive Summary
• Description of the business
• Goals and Objectives
• Project Description
• Management and Personnel
• Financial Statements
• Outline of Sources and Funds

And, of course, a marketing plan. But why should your agency have a marketing plan? The reasons are many and varied. A marketing plan will:

1. Minimize the costs of false starts - It's important to know exactly where you are headed. If you are driving down the highway and all of a sudden realize you are headed in the wrong direction, you need to backtrack. This wastes time and money. In a highly competitive situation, such as the insurance industry, coming in second can result in a huge negative in terms of lost business and opportunities. If customers are waiting in line today to purchase your services and you don't arrive until tomorrow, the business goes to the competition.

2. Maximize effectiveness of staff/sales people by defining job responsibilities - When your team members understand exactly what is expected of them, this increases their effectiveness. The marketing plan should clearly define the company's goals so that each member can work towards achieving them. Your staff may all be working hard, but if half of them are going in one direction, and the other in another direction, the company won't go anywhere. This also speaks to profitability. You don't want your staff spending its time on activities that won't benefit the company. For example, if you have a product that sells for $100 and anther for $5, wouldn't you want your staff focusing its time on increasing sales for the $100 item?

3. Allow your business to hone in on specific segments of the market and allow you to spend your marketing dollars wisely - Most organizations are not large enough to be all things to all people. Therefore, an effective marketing plan will help define your target market. Let's say you want to target the 45- to 65-year-old population who earns at least $100,000 annually. Your goal is to be known as the insurance carrier whose specialty is this particular group. By targeting that market, you not only become the 'expert' which allows you to provide those clients with outstanding service, but you won't waste your marketing dollars on other segments that won't result in high returns.

4. Allows for easier tracking of results per activity attempted - Although a marketing plan will help you track the effectiveness of your marketing activities, tracking results can be difficult.