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Section III. Building the Business Plan:
Marketing and Financial Considerations
Chapter 8
Building a Powerful Marketing Plan
Part 1: Learning Objectives
1. Describe the principles of building a guerrilla marketing plan and explain the
benefits of preparing one.
2. Explain how small businesses can pinpoint their target markets.
3. Discuss the role of market research in building a guerrilla marketing plan and
outline the market research process.
4. Describe how a small business can build a competitive edge in the marketplace
using guerrilla marketing strategies: customer focus, quality, convenience,
innovation, service, and speed.
5. Discuss the marketing opportunities the World Wide Web offers entrepreneurs
and how to best take advantage of them.
Part 2: Class Instruction
Introduction
Creating a solid business plan improves an entrepreneur’s odds of building a
successful company. The business plan captures many of the topics discussed, and in
addition, it includes a concise statement of how an entrepreneur plans to achieve
success in the marketplace. This section focuses on building the marketing plan.
Building a Guerrilla Marketing Plan
LO 1
Marketing is the process of creating and delivering desired goods and services to
customers and involves all of the activities associated with winning loyal customers.
Guerilla marketing strategies are unconventional, low-cost, creative techniques –
small companies can get more “bang” from their marketing bucks. This allows the
required marketing investment to fit the often limited marketing resources of the
organization.
A guerilla marketing plan should accomplish four objectives:
1. It should determine customer needs and wants through market research.
2. It should pinpoint the specific target markets the company will serve.
3. It should analyze the firm’s competitive advantages and build a marketing
strategy around them.
4. It should help create a marketing mix that meets customer needs and wants.
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Pinpointing the Target Market
LO 2
Target markets are the specific groups of customers at whom the company aims its
goods or services.
Pinpointing the target market offers greater marketing efficiency. Mass marketing
techniques of the past are expensive and risky. The marketing strategy can then reach
that specific targeted group that has the highest propensity to buy and be an ongoing
customer.
Target customers must permeate the entire business—merchandise, music, layout,
décor, Web site, and the total experience.
Market research can be invaluable to better understand, segment, and identify target
markets.
Determining Customer Needs and Wants Through Market Research
LO 33
Market research serves as the foundation for the marketing plan. Its objective is to
learn how to improve the level of satisfaction for existing customers and to find ways
to attract new customers. By performing some basic market research, small business
owners can detect key demographic and market trends. Market research does not have
to be time consuming, complex, or expensive to be useful.
Demographics are the characteristics and trends of a population including age,
income, gender (composition), education, household size, race, and ethnicity. For
example, we can quickly gain information regarding the growth rate of U.S.
populations by many criteria, such as race.
Market research is the vehicle for gathering this information and can avoid basing
your marketing plan on assumptions rather than facts.
Tracking trends can be a valuable and affordable way to get a pulse on markets. Faith
Popcorn, a marketing consultant and author, offers tips to help spot significant trends:
 Read as many current publications as possible
 Monitor blogs and newsgroups
 Watch the top 10 TV shows
 See the top 10 movies
 Talk to at least 150 customers a year about what they’re buying and why
 Talk with the 10 smartest people you know
 Listen to your children—What trends are they tracking?
How to Conduct Market Research
Conducting market research involves four steps:
Step 1: Define the objective
Step 2: Collect the data
Step 3: Analyze and interpret data
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Step 4: Draw conclusions and act
Market research with existing customer is also valuable:

Identifies your best customers
 Enhances your products and services
 Welcomes customer complaints
 Offers exceptional quality
 Understands your customers’ buying cycle
 Calculates the long-term value of customers
Plotting a Guerrilla Marketing Strategy: How to Build a Competitive Edge
LO 4
A company can establish a competitive edge when customers perceive that one
organization’s products or services are superior to those of its competitors. Successful
entrepreneurs often use the special advantages that flow from their companies’ small
size to build a competitive advantage over their larger rivals.
Guerilla marketing strategies can be instrumental in building a brand for your
business in a number of ways as long as you always focus on the customer. Focusing
on the customer allows you to optimize your marketing and profitability potential. As
we will address again, every business depends on customer satisfaction. If you can’t
take care of your customers, someone else will!
We will address these guerilla marketing principles:
 Find a niche and fill it
 Use the power of publicity
 Don’t just sell, entertain
 Strive to be unique; create an identity for your business
 Build a community with customers
 Connect with customers on an emotional level
 Create an identity for your business through branding
 Embrace social networking
 Start a blog
 Create online videos
 Host a special event
 Dedication to service and customer satisfaction
 Retain existing customers
 Devotion to quality
 Attention to convenience
 Concentrate on innovation
 Emphasize speed
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Let’s begin with finding a niche and filling it. As we learned in Chapter 3, Strategic
Management and the Entrepreneur, many successful small companies choose their
niches carefully and defend them well. A niche strategy allows a small company to
maximize the advantages of its size and to compeer effectively.
The power of publicity and be another cost effective way to get exposure to your
target market. Writing articles, sponsoring events, and getting online exposure are just
a few of the ways to leverage publicity.
Don’t just sell: entertain! Retail stores and restaurants apply the principle of
entertailing to entice and amaze customers.
Strive to be unique through creating a one-of-a-kind image for customers enabling
you to stand out from competitors.
Build a community with customers in a way that creates meaningful, lasting
relationships. One way these companies can do this is through relationship marketing,
or customer relationship management, referred to as CRM. Relationship marketing
involves the following five steps:
1. Collect meaningful customer information and compile it as a database
2. Mine the database to identify “best” customers
3. Use the information to develop lasting relationships with “best” customers
4. Attract more customers who fit the “best” customer profile
5. Stay in contact with customers between sales
Connect with customers on an emotional level by building trust and defining a
unique selling proposition, known as a USP.
The unique selling proposition offers a key customer benefit of a product that sets it
apart from its competition. It answers the question: “What’s in it for me?”
Communicate the unique selling proposition consistently and often!
There is a correlation between branding and a unique selling proposition, as
illustrated in Figure 8.2: The Connection between Branding and a USP on page 290.
Building a brand is how businesses create an identity and an image for their
customers.
A small business Web site can enable it to sell its products around the world. It is a
phenomenal commercial opportunity that offers businesses a worldwide marketing
and distribution system. The Internet is the “Great Equalizer” for entrepreneurs in a
world of larger and more powerful competitors. Today’s business students and
entrepreneurs are on the frontier of an industry and market that will likely see
tremendous growth in the next few years.
Embrace social marketing by getting connected through Facebook, LinkedIn, Twitter
and other social networking sites. This can be simple, it does not cost to participate,
and prove to be powerful way to connect with existing and prospective customers.
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Start a blog to expand your reach on the Web. Follow these guidelines:

Be honest, balanced , and interesting when writing a blog

Post blog entries consistently so that readers have a reason to return

Ask customers for feedback.

Strive to cultivate the image of an expert of a trusted friend on a topic that is
important to you customers.

Use services such as Google Alerts that scan the Web for a company’s name
and send e-mailers when it finds posts about a company.

Promote the blog via e-mail and promotional Web sites.
Create online videos and in the process:

Think “edutainment”

Be funny

Connect with current events

Involve their customers keep it short.

Keep it short
Figure 8.3: Social Media That Entrepreneurs Use as Marketing Tools on page 290
ranks the most popular social media resources.
Host a special event to connect with your business community. This creates a forum
to allow customer to meet you and others.
Dedication to service and customer satisfaction is one way to achieve the goal of
“customer astonishment.” Dedication to service deals with these twelve attributes:
 Listen to customers
 Define a “superior space”
 Set standards and measurements for performance
 Examine your service cycle
 See customer complaints as a mechanism for improving customer service
 When you create a negative customer experience, apologize and fit it – fast!
 Hire the right employees
 Train employees to deliver superior service—every time!
 Empowering employees to offer superior customer service
 Treat employees with respect and value
 Use technology to provide improved service
 Reward superior service
 Get top managers’ support
 Give customers an unexpected surprise
 Viewing developing stellar customer service as an investment, not an expense
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Retain existing customers to form loyal, long-term relationships. Retaining these
customers may be the best investment in the future of a business. Research indicates that
repeat customer spend 67 percent more than new customers. In addition, attracting new
customers can coast seven to nine times more than keeping an existing customer.
A focus on the customer can directly correlate to higher customer retention rates and is
based on the response to these four questions:
1. What are we doing right?
2. How can we do that even better?
3. What have we done wrong?
4. What can we do in the future?
Devotion to quality is another point of differentiation. Quality goods and services are a
prerequisite for survival. Today quality is more than just a slogan. Businesses buy into
operational strategies like total quality management (TQM) where quality is in the
product or service and in every other aspect and component of the business as well. It is
important to understand how customers (American customers and others) define quality
in the products and services they purchase.
Concentration on innovation is a key to future success. In order to keep up with
changing markets, small businesses must be innovative. Small businesses are frequently
leaders in innovation even though they may lack resources compared to larger businesses.
Attention to convenience is an important part of this relationship experience. Customers
want convenience. Studies show that customers rank convenience at the top of their
purchasing criteria. Successful companies must show that it is easy for customers to do
business with them.
Areas to offer customer convenience include:

Location

Hours

Delivery services

Payment options

Transaction efficiency

Additional “extra” experiences

Product bundling

Product adaptation

Communication efficiency
Emphasis on speed enables companies to be competitive and reduce the time it takes to
develop, design, manufacture, and distribute a product, which results in reduced costs,
increased quality, and increased market share.
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Time compression management (TCM) is on approach to enhance response time. TCM
relies on the principles of speeding product to market, shortening customer response time
in manufacturing and deliver, and reducing the administrative time required to fill an
order.
In addition to the text –
The Principles of Customer Experience Management (CEM) address the need to
establish:

An intimate understanding of each customer’s needs, want preferences, and
peculiarities

A personal, customer-specific message in marketing, sales, service, and
advertising

A consistent, courteous, and professional treatment by everyone

A responsive, rapid handing of requests, questions, problems, and complaints

Helpful information and advice delivered proactively

The involvement of caring, well-trained people

Long-term view of the company/customer relationship with an emphasis on
sustaining an ongoing relationship

Frequent and visible demonstrations of commitment to nurturing this relationship
Guerrilla marketing strategies help to attain customer focus in a direct and economical
manner.
Conclusion
Guerrilla marketing offers the entrepreneurs significant benefits to create awareness
and promote their business. Understanding the target market establishes the
foundation. A sustainable competitive advantage comes from combination of areas
such as:
 Customer focus
 Quality
 Convenience
 Innovation
 Service
 Speed
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Part 3: Chapter Exercises
You Be the Consultant:
“Learnvest: Giving Women Control of Their Financial Lives”
pages 276-277
1. Visit the company’s Web site at www.leranvest.com to learn more about the
business, the services it offers, and its culture. Work with a team of your
classmates to develop a list of guerrilla marketing techniques that the company
can use to promote its services and its brand. .
Encourage student teams to be creative in their recommendation while they keep the
scope and scale of Learnvest in mind. They should focus on the established female
target market of Learnvest and responds with variations of the following:
Enhance the Web site through the use of graphics and photos on the site to enhance
the overall image, navigation, interaction and quality of the information and the total
experience. In addition, look for opportunities to promote it services and the
Learnvest brand through these guerrilla marketing techniques to enhance customer
satisfaction and loyalty:

Find a niche and filling it.

Leverage the power of publicity

Strive to be unique through creating a one-of-a-kind image

Build a community with customers

Connect with customers on an emotional level by building trust and defining a
unique selling proposition

Embrace social marketing

Create online videos

Be dedicated to service and customer satisfaction

Focus on retaining existing customers

Be devoted to quality

Concentration on innovation

Provide convenience

Emphasize speed
1. What steps can von Tobel take to enhance the Learnvest brand and build
customer recognition of it? Refer to Figure 8.4 (connection between branding
and a unique selling proposition) and use the table below to do the following:
a. List threshold, performance, an excitement attributes for Leanrvest.
b. Identify “proof points,” reasons for customers to believe in the brand,
that support each of the attributes you list.
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Expect students to apply the grid on page 277 and apply the concepts
presented in Figure 8.4 on page 290. Students should demonstrate the
following “reasons for customers to believe” through these thresholds:
Threshold Attributes:
Benefits that customers expect from a brand.
Example: Sound financial information and
guidance for the woman that seeks to be financially
“fit.”
Performance Attributes: Benefits that your brand can offer customer that are
superior to those that your competitors offer.
Example: Financial information that is easy to find,
current, and specific to a selection of customer
profiles and situations.
Excitement Attributes:
Benefits that customers get excited about and that
have the capacity to differentiate your company’s
brand from all others.
Example: Information tailored to woman’s personal
profile meeting her unique financial information
needs unlike any other online resource.
c. Use the attributes and their proof points to develop a unique selling
proposition for Learnvest.
Student should then apply this attribute information to develop a unique
selling proposition for Learnvest. The students’ USP should identify a key
customer benefit of a product or service that sets it apart from the competition
and answer the critical customer question: “What’s in it for me?”
You Be the Consultant: “The Social Sauce Experiment”
page 291-292
1. Identify at least three lessons that entrepreneurs can learn from the Social Sauce
Experiment.
Lessons learned from the Social Sauce Experiment may include

Be flexible and open to new possibilities of promoting the business

Try new strategies and tactics – regardless of your historic “comfort zone”

Leveraging the power of social media

Be prepared for success and failures

Keep experimentation affordable

Be able to track the impact, or lack of, based on the outcomes of your
marketing efforts
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2. Work with a team of your classmates to create your own Social Sauce
Experiment. Select a local business that has not social media presence and
develop a plan to boost its visibility sales, and profits with a social media
strategy.
Expect students to identify a business that does not have a developed social media
presence and apply the concepts presented in the chapter.
3. Identify at least three guerrilla marketing strategies discussed in this chapter
that Big Papa’s BBQ can use to increase it visibility, sales, and profits. Explain
how the company should implement each one.
The guerrilla marketing strategies may include a selection from the following for Big
Papa’s BBQ to increase visibility, sales and profits:
 Find a niche and fill it
 Use the power of publicity
 Don’t just sell, entertain
 Strive to be unique; create an identity for your business
 Build a community with customers
 Connect with customers on an emotional level
 Create an identity for your business through branding
 Embrace social networking
 Start a blog
 Create online videos
 Host a special event
 Dedication to service and customer satisfaction
 Retain existing customers
 Devotion to quality
 Attention to convenience
 Concentrate on innovation
 Emphasize speed
Encourage student to be creative in their recommendation while they keep the scope
and scale of Big Papa’s BBQ.
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Part 4: Chapter Discussion Questions
1. Define the marketing plan. What lies at its center? (LO 1)
The marketing plan focuses the company’s close and intimate attention on the
customer and recognizes that satisfying the customer is the foundation of every
business. Its purpose is to build a strategy for success with a focus on the customer.
2. What objectives should a marketing plan accomplish? (LO 1)
The marketing plan has four objectives:
1. Determining customer needs and wants through market research
2. Pinpointing specific target markets the small company will serve
3. Analyzing the firm’s competitive advantages and building a marketing
strategy around them
4. Helping to create a marketing mix that meets customer needs and wants
3. How can market research benefit a small business owner? List some possible
sources of market information. (LO 3)
Market research provides the foundation for the marketing plan. By performing basic
market research, small business owners can identify key demographic and market
trends. Possible sources of market research include:

Current publications such as business directories and magazines

Direct mail lists

Demographic data such as what is available at www.uscensus.gov

Forecasts information

Local information through your state department of commerce and local
chamber of commerce

Online information

Top ten shows

Top ten movies

Customers

Smart people you know

Children
4. Does market research have to be expensive and sophisticated to be valuable?
Explain. (LO 3)
No, market research does not have to be expensive and sophisticated to be valuable.
For example, for most business owners, information is often floating around. It is a
matter of collecting and organizing the data to make it valuable.
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5. Describe several market trends that are driving market into the next millennium
and their impact on small business and their impact on small business. (LO 3)
Six market trends that affect small business include:
1. Increasing population diversity offers special challenges to business owners.
2. Changing family patterns will force marketers to rethink their strategies.
3. Greater environmental and health concerns have consumers more focused
on the environmental impact of the products and services they buy.
4. Emergence of “premium” and “discount” niches as an increasing number of
lower income households force more buyers to become bargain shoppers.
5. Surge in “baby boomers” and the elderly results in changing needs for those
consumers.
6. Greater emphasis on social responsibility has a growing number of
consumers buying products associated with a cause they care about.
7. Slower growing markets and shorter product life cycles require businesses to
focus on narrow niches, understand customer needs and wants, and give them
value.
6. Why is it important for small business owners to define their target markets as
part of their marketing strategies? (LO 2)
Small businesses must be more focused on the types of customers they want to target.
Small firms are ideally suited to reach market segments that their larger rivals
overlook or consider too small to be profitable. A clear, concise target market allows
a small business to increase its marketing efficiency and be profitable.
7. What is a competitive advantage? Why is it important for a small business
owner to create a plan for establishing one? (LO 4)
A competitive advantage is an aggregation of factors that sets a company apart from
its competitors. Developing a strategic plan allows a small business to differentiate
itself from other companies. Developing a strategic plan allows the small company to
meet the customers’ needs of today, while looking one step ahead to what they will
need tomorrow.
8. Describe how a small business owner could use the following sources of a
competitive advantage – see text for list. (LO 4 and 5)
A small business owner could implement the following sources to establish a
competitive advantage:
 Focusing on a niche: Target a specific segment of the population that your
business can efficiently serve—senior citizens.
 Don’t just sell—entertain: Entertailing offers an experience that customers
enjoy and actively seek out and enjoy –themed restaurants.
 Strive to be unique: An experience like none other - the latest look style and
fashion
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








Creating an identity for the business: A name or a song that everyone
associates with your product.
Connecting with customers on an emotional level: Environmentally safe
products.
Focusing on the customer: Specialized exercise equipment for disabled
people.
Focusing on the customer: Health and beauty aids—hair coloring.
Be devoted to quality: Specialty food products.
Pay attention to convenience: Business location.
Concentration on innovation: Battery powered blenders.
Dedication to service: Installation and maintenance of product lines.
Emphasize speed: Use the latest technology and resources to enhance
customer service.
9. One manager says, “When a company provides great service, its reputation
benefits from a stronger emotional connection with its customers, as well as from
increased confidence that it will stand behind its products.” Do you agree?
Explain. If so, describe a positive service experience you have had with a
company and your impressions of that business. . What are the implications of a
company providing poor customer service? Once again, describe a negative
service experience you have had with a company and your impressions of that
business. How likely are you to do business with that company again? (LO 4)
Expect students to realize that, in most cases, great service experience creates a bond
and a confidence in the product or service. This enhances the perception of the
company and the desire to be a repeat customer. Expect students to share their
positive experiences and comment on how that impacts their perception of that
business.
Negative experiences can have a devastating impact on a venture. People are more
likely to share negative experiences and services through mouth-to-mouth
communication and through Web sites, such as Yelp, that provide a method to share
information faster on a larger scale basis. Expect students to discuss their negative
customer service experiences, their resulting impressions, and the likelihood that they
will do business with that company in the future.
10. First, consumer behavior expert and retail consultant Paco Underhill says, “A
[retail] store is a 3-D brand. Everything that’s there has to be there for a
reason.” Do you agree? Second, find two retail stores in the local area – one
that offers a good example of a 3-D brand and one that does not. Prepare a onepage summary explaining your reasoning for selecting these two stores. (LO 4)
Some of the most successful retail stores create a complete 3-D retail and
entertainment-like experience. From their merchandise, the store layout, the music,
the atmosphere, their complementary Web site—it all is tailored to communicate a
consistent look, feel, and message that appeals most to their target market.
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Ultimately, the total “entertailing” experience catches the attention of customers and
encourages them to shop longer and buy more goods and services. This 3-D brand
approach further differentiates the business, enhances customer loyalty, and impacts
profitability.
Expect students to prepare a one-page summary that discusses the reason for selecting
and compares the two retail stores presented and highlighting the reasons for selecting
these stores.
11. With a 70 percent customer retention rate (average for most U.S. firms,
according to the American Management Association), every $1 million of
business in 2000 will grow to more than $4 million by the year 2010. If you retain
80 percent of your customers, the $1 million will grow to a little over $6 million.
If you can keep 90 percent of your customers, that $1 million will grow to more
than $9.5 million. What can the typical small business do to increase its customer
retention rate? (LO 4)
A small business can practice a company philosophy of that involves a dedication to
service, customer satisfaction, and customer astonishment. These factors build
customer loyalty which has proven to be a leading indicator of business success.
Part 5: Case Studies
The following text cases may be used for lecture and assignments for topics presented in
this chapter.

Case 2: Mixed Chicks

Case 3: True Body Products

Case 4: Little Dudes and Divas
Part 6: Online Videos and Podcasts
These online videos may enhance class discussion and provide additional insight for the
chapter topics. You may want to try search terms such as “guerilla marketing,”
“marketing plan” and other chapter related terms.

Bloguerrilla – Guerrilla Marketing
http://www.youtube.com/watch?v=QlBMF1MvAGY
2:05 minutes

Cannes Lions 2012 – Best Guerilla Marketing Campaign
http://www.youtube.com/watch?v=Y6-3UJIcmZ4
5:26 minutes

Creative Guerrilla Marketing
http://www.youtube.com/user/cguerrillamblog
0:15 minutes

Guerrilla Marketing
http://www.youtube.com/watch?v=_5D52OB84Gw
2:07 minutes
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
Guerrilla Marketing Ideas for Any Business
http://www.youtube.com/watch?v=ZdtC0VeH5OI
8:58 minutes

Guerrilla Marketing Example – Fast Lane
http://www.youtube.com/watch?v=98EJx7OKqLI
1:42 minutes

Guerilla Marketing Example – Coco-Cola Happiness Machine
http://www.youtube.com/watch?v=qMOuF8oskRU
2:03 minutes

Launching a New Product
http://smallbiztrends.com/2009/12/launching-a-new-product.html
2:23 minutes

Marketing
http://www.sba.gov/strategiesforgrowth/marketing/index.html
8:10 minutes

Measuring Customer Intelligence
http://www.bnet.com/2434-18434_23-162366.html
5:22 minutes

The Simple Truths of Service
http://www.stservicemovie.com/
2:00 minutes
Links to additional online resources are available on the companion Web site at
www.pearsonhighered.com/scarborough.
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