Building a Powerful Bootstrap Marketing Plan & Crafting a Business Plan and Building a Solid Strategic Plan

Building a Bootstrap Marketing Plan

Marketing is the process of creating and delivering desired goods and the services for customers and it will be involves all of the activities which associated with winning and retaining loyal customers. The “secret” to successful marketing is to understand what your target customers’ needs, demands, and wants are before your competitors can; to offer them the products and services that will satisfy those needs, demands, and wants; and to provide customer service, convenience, and value so that they will keep coming back.

Successful entrepreneurs recognize that modern marketing strategies also must include techniques such as social media and cause marketing that pull customers into their companies’ sphere of influence. The good news is that many of these “pull” strategies are relatively inexpensive and, when infused with a healthy dose of creativity, are extremely effective.

By using bootstrap marketing strategies—unconventional, low-cost, creative techniques—small companies can wring as much or more “bang” from their marketing bucks An effective bootstrap marketing campaign does not require an entrepreneur to spend large amounts of money, but it does demand creativity, ingenuity, and an understanding of customers’

A Seven-Sentence Bootstrap (Guerrilla) Marketing Strategy

1.      What is the purpose of your marketing?

2.      What primary benefit can you offer customers?

3.      Who is your target market?

4.      What is the marketing tools will you use to reach your target market?

5.      What is your company’s niche in the marketplace?

6.      What is your company’s identity in the marketplace?

7.      How much your budget want to spent in marketing??

Pinpointing the Target Market

One of the first steps in building a bootstrap marketing plan is to identify a small company’s target market Smart entrepreneurs know they do not have the luxury of wasting resources. They must follow a more focused, laserlike approach to marketing. Entrepreneurs must identify a specific market niche that has a specific need or “pain point” and tailor a solution, be it a product or a service, to address this need

Most successful businesses have well-defined portraits of the customers they are seeking to attract. From market research, they know their customers’ income levels, lifestyles, buying patterns, likes and dislikes, and even their psychological profiles—why they buy. These companies offer prices that are appropriate to their target customers’ buying power, product lines that appeal to their tastes, and service they expect. The payoff comes in the form of higher sales, profits, and customer loyalty. For entrepreneurs, pinpointing target customers has become more important than ever before as markets in the United States have become increasingly fragmented and diverse. Mass marketing techniques no longer reach customers the way they did 30 years ago because of the splintering of the population and the influence exerted on the nation’s purchasing patterns by what were once minority groups such as Hispanic, Asian, and African Americans

Determining Customer Needs and Wants through Market Research

Entrepreneurs who ignore demographic trends and fail to adjust their strategies accordingly run the risk of becoming competitively obsolete. Entrepreneurs who stay in tune with demographic, social, and economic trends are able to spot growing and emerging market opportunities.

The Value of Market Research

Market research is the vehicle for gathering the information that serves as the foundation for the marketing plan. It involves systematically collecting, analyzing, and interpreting data pertaining to a company’s

Small companies cannot afford to make marketing mistakes because there is little margin for error when funds are scarce and budgets are tight.

How to Conduct Market Research

Step 1. Define the objective.

Step 2. Collect the data

Step 3. Analyze and interpret the data.

Step 4. Draw conclusions and act

Plotting a Bootstrap Marketing Strategy: How to Build a Competitive Edge

To be successful bootstrap marketers, entrepreneurs must be as innovative in creating their marketing strategies as they are in developing new product and service ideas

Bootstrap Marketing Principles

The following 14 principles can help business owners create powerful, effective bootstrap marketing strategies.

1.     BE A NICHE AND USE IT

2.     USE THE POWER OF PUBLIC

3.     DO NOT JUST SELL BUT ENTERTAIN TOO!

4.     YOU NEED TO STRIVE TO BE UNIQUE THAN OTHER

5.     COMMUNITY WITH CUSTOMERS IS IMPORTANT

6.     CONNECT WITH CUSTOMERS ON AN EMOTIONAL LEVEL

7.     CREATE AN IDENTITY FOR YOUR BUSINESS THROUGH BRANDING

8.     EMBRACE SOCIAL MARKETING

9.     BE DEDICATED TO SERVICE AND CUSTOMER SATISFACTION

10.  RETAIN EXISTING CUSTOMERS

11.  BE DEVOTED TO QUALITY

12.  ATTEND TO CONVENIENCE

13.  CONCENTRATE ON INNOVATION

14.  EMPHASIZE SPEED

Conclusion

Small companies lack the marketing budgets of their larger rivals, but that does not condemn them to the world of second-class marketers and its resulting anonymity. By using clever, innovative bootstrap marketing strategies such as the ones described in this chapter, entrepreneurs can put their companies in the spotlight and create a special connection with their customers.

A business plan is a planning tool that builds on the foundation of the idea assessment, feasibility analysis, and business model discussed in Business Plan A business plan provides a more comprehensive and detailed analysis than the first three steps in the new business planning process.

Research suggests that, whatever their size, companies that engage in business planning outperform those that do not. A business plan offers:

·       a systematic, realistic evaluation of a venture’s chances for success in the market.

·       a way to determine the principal risks facing the venture.

·       a “game plan” for managing the business successfully during its start-up.

·        a tool for comparing actual results against targeted performance.

·       an important tool for attracting capital in the challenging hunt for money

The Benefits of Creating a Business Plan

A business plan is a written summary of an entrepreneur’s proposed business venture, its operational and financial details, its marketing opportunities and strategy, and its managers’ skills and abilities. There is no substitute for a well-prepared business plan, and there are no shortcuts to creating one. The plan serves as an entrepreneur’s road map on the journey toward building a successful business. A business plan describes which direction the company is taking, what its goals are, where it wants to be, and how it intends to get there. The plan is written proof that an entrepreneur has performed the necessary research, has studied the business opportunity adequately, and is prepared to capitalize on it with a sound business model. Crafting a business plan is an entrepreneur’s last insurance against launching a business destined to fail or mismanaging a potentially successful company.

To get external financing, an entrepreneur’s plan must pass three tests with potential lenders and investors: (1) the reality test, (2) the competitive test, and (3) the value test. The first two tests have both an external and internal component:

1.     REALITY TEST
The internal component of the reality test focuses on the product or service itself, Can the company really build it for the cost estimates in the business plan The external component of the reality test involves proving that a market for the product or service really does exist. It focuses on industry attractiveness, market niches, potential customers, market size, degree of competition, and similar factors. Entrepreneurs who pass this part of the reality test prove in the marketing portion of their business plans that there is strong demand for their business idea. Evidence that is gathered during the testing of the business model should be an integral part of the marketing plan to bolster the proof for the idea using real customers

2.     COMPETITIVE TEST

The external part of the competitive test evaluates the company’s relative position to its key competitors. How do the company’s strengths and weaknesses match up with those of the competition Successful entrepreneurs carefully and honestly evaluate the strength of their product ideas. Do we offer a solution that looks at the problem differently than competitors, Can we protect our intellectual property

3.     VALUE TEST

The real value in preparing a plan is not as much in the plan itself as it is in the process the entrepreneur goes through to create the plan—from the idea assessment, to the feasibility analysis, through the development and testing of the business model, and finally with the crafting of the written business plan.

The Elements of a Business Plan

1.     TITLE PAGE AND TABLE OF CONTENTS

2.     THE EXECUTIVE SUMMARY

3.     MISSION AND VISION STATEMENT

4.     DESCRIPTION OF FIRM’S PRODUCT OR SERVICE

5.     BUSINESS AND INDUSTRY PROFILE

6.     COMPETITOR ANALYSIS 

7.     MARKET ENTRY STRATEGY

8.     MARKETING STRATEGY

9.     ENTREPRENEURS’ AND MANAGERS’ RÉSUMÉS

10.  PLAN OF OPERATION

11.  PRO FORMA (PROJECTED) FINANCIAL STATEMENTS

12.  THE LOAN OR INVESTMENT PROPOSAL

What Lenders and Investors Look for in a Business Plan

1.     CAPITAL

2.     CAPACITY

3.     COLLATERAL

4.     CHARACTER

5.     CONDITIONS

The Pitch: Making the Business Plan Presentation

Usually, the time for presenting a business opportunity is short, often no more than just a few minutes. (When presenting a plan to a venture capital forum, the allotted time is less than 20 minutes and rarely more than 30.) When the opportunity arises, an entrepreneur must be well prepared. It is important to rehearse, rehearse, and then rehearse some more. It is a mistake to begin by leading the audience into a long-winded explanation about the technology on which the product or service is based. Within minutes most of the audience will be lost, and so is any chance the entrepreneur has of obtaining the necessary financing for the new venture. A business plan presentation should cover five basic areas:

·       Your company and its products and services. The presentation should answer in simple terms the first question that every potential lender and investor has: What does your company do?

·       The problem to be solved, preferably told in a personal way through a compelling story. Is it eliminating the time, expense, and anxiety of waiting for the results of medical tests with a device that instantly reads blood samples? Or making hearing aids more effective at filtering out background noise while enhancing the dominant sound for the user?

·       A description (again in simple terms) of your company’s solution to the problem. Ideally, the solution your company has developed is unique and serves as the foundation of your company’s competitive edge in the marketplace.

·       Your company’s business model. This part of the presentation explains how your company makes money and includes figures such as revenue per sale, expected gross profit and net profit margins, and other relevant statistics. This is your opportunity to show lenders and investors how your company will produce an attractive payback or payoff.

·       Your company’s competitive edge. Your presentation should identify clearly the factors that set your company apart from the competition

The Strategic Management Process

Strategic management is a continuous process that consists of nine steps:

Step 1. Develop a clear vision and translate it into a meaningful mission statement.

Step 2. Assess the company’s strengths and weaknesses.

Identifying strengths and weaknesses helps owners understand their businesses as they exist (or that, for start-ups, will exist). An organization’s strengths should originate in the core competencies that are essential to gaining an edge in each of the market segments in which the firm competes. The key to building a successful strategy is using the company’s underlying strengths as its foundation and matching those strengths against competitors’ weaknesses

Step 3. Scan the environment for significant opportunities and threats facing the business.

When identifying opportunities, an entrepreneur must pay close attention to new potential markets and product offerings. Are competitors overlooking a niche in the market we could easily exploit? Is there a better way to reach our customers, such as a greater focus on online sales? Are there new markets we can expand into with our existing business? Can we develop new products that offer customers better value? What opportunities are trends in the industry creating?

Step 4. Identify the key factors for success in the business.

KEY SUCCESS FACTORS Every business is characterized by controllable variables that determine the relative success of market participants. By focusing efforts to maximize their companies’ performance on these key success factors, entrepreneurs can achieve dramatic market advantages over their competitors.

Companies that understand these key success factors tend to be leaders of the pack, whereas those that fail to recognize them become also-rans.

Key success factors (KSFs, also called key performance indicators) come in a variety of patterns, depending on the industry. Simply stated, these factors determine a company’s ability to compete successfully in an industry. Every company in an industry must understand the KSFs that drive the industry; otherwise, they are likely to become industry also-rans like the horses trailing the pack in the Kentucky Derby.

1.     Experience in the industry 

2.     Sufficient start-up capital 

3.     Tight cost control (labor costs, 15 to 18 percent of sales, and food costs, 35 to 40 percent of sales) 

4.     Accurate sales forecasting, which minimizes wasted food

5.     Proper inventory control

6.     Meticulous cash management

7.     Choosing locations that maximize customer convenience

8.     Cleanliness

9.     High food quality

10.  Friendly and attentive service from a well-trained wait staff

11.  Consistency in quality and service over time

12.  Speed, particularly at lunch, when the restaurant attracts businesspeople who must dine quickly and get back to work

13.  A clear definition of the restaurant’s distinctive concept—its food, decor, service, and ambiance

Step 5. Analyze the competition.

Step 6. Create company goals and objectives.

Step 7. Formulate strategic options and select the appropriate strategies.

 Step 8. Translate strategic plans into action plans.

Step 9. Establish accurate controls.

Conclusion

A solid business plan is essential to raising the capital needed to start a business; lenders and investors demand it. “There may be no easier way for an entrepreneur to sabotage his or her request for capital than by failing to produce a comprehensive, well-researched, and, above all, credible business plan,” says one small business expert.70 Creating a successful business requires entrepreneurs to put the plan into action and then manage the company’s growth with a sound strategic plan.