Have you ever given a presentation without any preparation? If your answer is YES, you’re a superhuman and Nick Fury is looking for you. But if you’re like the rest of us and your answer’s a NO, read on to find out the importance of a marketing strategy.
Everything requires preparation. Especially when it comes to the marketing strategy for your small business. Setting goals and creating a strategy to achieve them is paramount in making or breaking your business.
Marketers who proactively plan projects are 356% more likely to report success, as reported by Coschedule’s Marketing Management + Statistics Report in 2019.
What is a Marketing Strategy?
You have a product/service. You have to market it in order to make sales.
A marketing strategy is a framework that fulfills the marketing goals of your business. It is a crucial pretext to your overall Marketing Plan.
Aren’t Strategy and Plan the same?
In the world of marketing, one can say that they are same same but different. A marketing strategy and a marketing plan complement each other.
While a strategy is an overall approach to achieving your business goals, a marketing plan speaks about executing the strategy.
The Marketing Strategy Puzzle Pieces
Before we dive into the importance of a marketing strategy, here’s the breakdown of a few components that make up the marketing strategy for any business. These involve:
The Marketing Mix –
- Market Selection – This involves identifying your target audience. Your product/service caters to a specific group of consumers. Performing market research to understand whom it will best cater to will narrow down the people you need to market to. This will help in better planning for your market strategy.
- The 4 Ps of Marketing – Let’s get down to the brass tacks of marketing universally. The 4 Ps (Product, Price, Place and Promotion) make up the core of marketing. There have been other Ps added/removed over the years from around the World but these 4 remain.
- Product – The very reason your business exists. Aside from your passion, purpose and ambition, of course! The product/service your business is built around. The first P of marketing speaks of the product itself, the features of the product and the packaging.
- Price – Your product/service is going to be sold for an amount to the market. The monetary factors affecting this decision are the cost of goods, labour costs, competitor prices etc. All of this and the final selling price come under the second P of marketing.
- Place – A place where your buyer can find your product. The third P of marketing started off with a geographical location where the buyer could purchase your product. Owing to the Digital Era, Place now also refers to whether your product is available online/offline and where it’s available online too.
- Promotion – If your buyer is unaware of your product, how are they going to buy it? The fourth P of marketing speaks exclusively of just that; Marketing the product. Promoting the product on all possible avenues in order to gain maximum awareness is a prerequisite to selling the product.
Do you really need a Marketing Strategy?
Not really. You’ll only face the following if you don’t have a marketing strategy:
- Your Customer Retention will be low.
- You won’t be able to reach all your target customers.
- You’ll burn a hole in your pocket.
- Your competitors with a marketing strategy will be ahead of you.
- As a resultant effect, you’ll lose market share to them.
- Your execution will lack direction.
- And lack of direction will cost you your audience’s faith.
- Your growth will suffer stagnance.
We can only hope we’ve cleared that out for you. Now onto discussing just how important a marketing strategy is!
The Importance of a Marketing Strategy
Goal Oriented, Growth Oriented
If your business is goal oriented, it’s growth oriented.
In order to be goal oriented, you will have to set goals in a SMART manner.
S – Specific – Keeping your goals to the T.
M – Measurable – Making them quantifiable.
A – Actionable – Ensuring they can be executed.
R – Realistic – Staying practical through the process.
T – Timely – Maintaining a schedule to achieve them.
This powerful abbreviation highlights the importance of a Marketing Strategy as long as you stick to it and see it through to the end.
What can goals do for your business?
- They act as a roadmap.
- It helps with day to day decisions.
- Goals require a timeline, which keeps you on your toes.
- Once you know what you’re fighting for, you fight harder.
- Goals help you understand potential roadblocks beforehand.
- You know that joy you feel when you cross an item from your To Do List? Achieving a goal is 100x that joy! Reportedly, ‘’People Who Write Down Their Goals Are 20% More Successful In Accomplishing Them Than Those Who Did Not’’.
Let’s talk specifically about how marketing strategies provide your business with guidelines for your goals. A marketing strategy helps you make the following decisions:
- Every brand has a USP (Unique Selling Proposition). A marketing strategy helps us define this USP and communicate it to the World.
- Methods to be used in order to increase website traffic.
- A strategy allows us to decide the means and tools we need to use in order to achieve the set goals.
- Branding is a mix of your unique identity and market relevance. 2021 saw a surge of brands changing their logos. Something that they wanted to change in the way they communicated led them to make some modifications to their existing brand. A market strategy helps in understanding how to appeal to your target audience with existing brand elements and improving on it.
Target Audience Found
The next point in the importance of a marketing strategy helps with identifying your target audience. Your product is meant for a set of people. Not everybody requires it, not everybody is going to buy it. Thus, marketing it to the general population will prove futile.
So how do you zero in on your target audience?
- Market Research – This is a starting point particularly for new businesses. Understanding the current market situation in your industry of choice gives you valuable insights into business decisions. You can conduct primary market research which includes surveys, interviews and focus groups. And secondary market research which includes relying on previously available data.
- Industry Trends – This works as a complement to market research. Studying the latest updates and developments in your industry helps you understand how you have to position your product.
- Existing Database – If you’re an existing business, the best place to start is in house. Look at statistics from your existing customers. Break it down into categories like repeating customers or bulk purchase customers. Pick out the common elements in each category and note them down. Eh Voila! You’ve built customer personas for your business.
- Customer Demographics – This is the small talk version of finding out about your target audience. Demographics cover factors like age, sex, marital status, education background, race, profession and income level.
- Competitor Analysis – Competitors are the best templates you’ll find for your business. Their approach, their product, their pricing helps you understand the pulse of the market, of what’s working and what isn’t. The most important part? Their target audience is similar/identical to what yours should be.
- Google Analytics – Granted, this one’s technical. It’s also game changing. The insights Google Analytics can provide for your online presence is sure to help narrow down the kind of consumers that will make up your target audience.
The Pros of having a target audience include –
- As simple as knowing exactly who you are catering to answers half your questions.
- Your ads can be very targeted thereby bringing your ad spend down to the required amounts.
- It helps you practice quality over quantity. You want to serve the few people who are interested in your product better rather than serving a lot of people who might not even need/want your product.
- There are no cons to having a target audience.
Product/Service Led Growth
What problem does your product/service solve for your customer?
Why would they want your product/service?
A importance of a marketing strategy is that it helps you understand what your product can offer to the customer. Product here includes the packaging, features, guarantees and warranties provided for your product as well.
Such a marketing strategy keeps your customer at the forefront of decision making. You will be dedicated to creating the best user experience for your customer, making sure all their requirements are being met.
The idea is to build a great product and let it speak for itself. A popular example is SurveyMonkey. Raise your hand if you’ve ever received a SurveyMonkey link to be filled out.
Okay, you can put your hand back down.
SurveyMonkey managed to grow simply by word of mouth. They created a great product, all there was left to do was wait for the awareness to increase. With a PLG strategy, the sales and promotion efforts are usually to a minimum.
The importance of a Marketing Strategy goes beyond just the marketing aspect of the business. One of your given goals is to be profitable as a business. Maximizing profitability can be done with a price centric marketing strategy. The second P of marketing here covers your pricing model, discounts, freemiums, offers, payment methods, etc.
It’s easy to go wrong with your pricing as there are so many factors at play. It seems simple, increase your margins and pocket your profits. Yet, multiple businesses are unable to fix an optimum price. It’s due to a lack of market strategy which includes not marketing to the right audience.
There are buyers who are willing to pay more for better quality, for brand value, for status. Understanding that this is the audience your business needs in order to be feasible and executing accordingly can be done with a marketing strategy in place.
One such global success is Bath & Body Works. They continually increase their prices knowing their target audience will not stop buying from them. This is a win-win for both sides!
The Right Channels
Now that you’ve figured out who your target audience is, the next step is to identify the right channels to promote the product to them. A well thought out marketing strategy can help you do just that. It answers the following questions –
- Which channels to promote the product on
- How often to use each channel
- How much ad spend can be dedicated to each channel
- What to say on each channel depending on the audience demographic
- How to balance online and offline marketing
The vastly loved toy brand Lego used promotional marketing strategies to revive the company from a deficit. By entering collaborations with branded entertainment (Lego Batman), growing a loyal YouTube fan base and having their customers promote the product via the Lego Life online community, the company was able to become the “world’s most valuable toy brand,” valued at $7.57 billion.
Surpass Your Competitors
One of the reasons a marketing strategy is important is that it involves a thorough competitor analysis. Once you know about your competitor, you can distinguish yourself (Identify your USP) from them and focus on strengthening that aspect of your business in order to surpass your competitor.
Place, the 3rd P of marketing, speaks about where your business is situated (online or offline), via whom your product is sold to the end consumer (Direct-to-consumer or through distributors and suppliers) and the logistics throughout the process.
An example we absolutely love is Chick-fil-A.
And yet, the chain has become the third largest in America. How’s that? Chick-fil-A focused on opening their restaurants in the right location. They thoroughly studied demographic and psychographic data to determine the potential of their locations. And they don’t stop there. The brand goes one step ahead and makes sure that the local store owners don’t compete with one another for business.
The How To Guide
A brief step-by-step guide of how to create the perfect marketing strategy for your business.
- Perform a SWOT Analysis
This is an organised person’s paradise. A ‘’Strengths, Weaknesses, Opportunities and Threats’’ Analysis helps you identify the pros and cons of your current situation. It’s a good starting point, knowing where you are so you can understand where you want to be.
- Identify Buyer Personas
The next step is to identify your buyer personas. As explained previously, this helps in finding your target audience and building a marketing strategy that caters specifically to them.
- Know your Customer
It’s not enough to just identify your buyer personas. You have to really know your customer. Empathise with the situations your target customers would be in and understand what best your product/service could offer them. It can be solving their problems, making an existing process more efficient, anything. How can you make something for someone without knowing them? How can you build the right marketing strategy without knowing your target customer?
- Define Clear Objectives
What is the end goal of your marketing strategy?
Do you want to increase awareness of your brand and create an identity or do you want more people to hit that ‘Submit Cart and Checkout’ option?
Understanding what your business needs at the moment helps inform your marketing strategy objectives. Once that’s clear, it’s easier to make the decisions that follow.
- Identify Your USP
Ooh, this one’s possibly the most important to figure out. Your Unique Selling Proposition is what makes you stand out from the crowd. This is the reason a consumer will choose you over your competitors.
You can use your SWOT analysis to figure out the USP by looking at your strengths and key differentiators among you and other businesses.
Consequently, your marketing strategy will be built to amplify the USP and find the right audience.
- Market Analytics
As important as it is to know your customer, knowing your market and competitors is crucial too. A thorough market research about your industry and competitors helps in building a well informed marketing strategy.
- Marketing Methods
Your marketing strategy arsenal is almost complete at this point. You know what you’re going to market, where you’re going to market it and whom you’re going to market to. This step brings us to ‘’Which’’ methods are you going to use in order to carry out the marketing strategy.
We now know the importance of a marketing strategy. Let’s capitalize on this awareness and jump into the execution phase.
Treat your marketing strategy as the holy grail of the marketing department in your business. Stick to it in order to achieve your marketing goals and overall business goals too!
Until next time, stay safe and take care.