1.

Understand Your Customer

Develop a clear picture of your target customer using market research and analysis.
Understand their pain points and the benefits of your solution.
2. Analyze the Market
Some basic market research should allow you to find market data such as total
available market, market growth (historical numbers and projections), market trends,
etc.
3. Analyze the Competition
Ask yourself what other choices your target customers have to solve their pain point.
Research and assess the strengths and weaknesses of each.
A solid competitive marketing strategy is the key to maximizing your business growth.
Essentially, a good competitive analysis involves understanding threee main elements:
your target customers, their key pain points (that your product will solve), competitive
solutions (other ways the target customer could solve their problem)
You may develop your competitive marketing strategy easily by following these three
steps:
a) Develop a Target Customer Profile
Your target customer is the individual or individuals who will purchase your
product. Hopefully you already have some idea of who your ideal target customer
is ( not specific names, but the type of buyer they are: eg, retail sales managers, or
stay-at-home moms, or whatever).
You need to get inside your target customers head, and paint as detailed a picture
of them as possible. There is often value in narrowing your market niche by
tightening up your target customer profile (eg, stay-at-home moms who work out
of the home, versus all stay-at-home moms), especially if you are a small company
or just starting out.
b) Identify your Target Customers Pain Points
It will be much easier to market and sell your product if it is solving a key problem
facing your target customers. Especially in a recession, other things are considered
nice to have and it can be much harder to drive those purchase decisions.
Think about the detailed target customer profile you just painted, and identify the
top 3-5 issues that keep them awake at night. How can your product solve one or
more of those pain points?
If your product is not a solution to one of your customers top problems, you may
need to re-evaluate either your product or your target market.

c) Identify and Analyze your Competitors

Once you have completed steps one and two, it becomes fairly straightforward to
identify your main competitors: just ask yourself what other solutions your target
customer has to their problem.
Often your main competitors will be other companies with products that are very
similar to yours. But be on the lookout for different ways that the customer could
solve their pain point - those are competitors also.
Now consider the ways in which your product or service is better than the
competitive options at solving the pain point of your target customer. Make a list
and refine it it should be short and easy to communicate. This is your Unique
Selling Proposition (USP).
4. Research Distribution Channels
What is the best way to deliver your product or service to your target customers? This
will impact your sales strategy and your financials, as well as your marketing mix.
5. Define Your Marketing Mix
Develop a clear picture of your Marketing Mix: product, price, place and promotion.
6. Analyze the Financials
Put together your marketing budget and evaluate projected marketing ROI, customer
acquisition costs, etc.
7. Review and Revise
Continuously evaluate the effectiveness of your marketing strategy, and revise or
extend as needed.

SWOT analysis is a process that identifies the strengths, weaknesses, opportunities, and
threats for an organization. It is a structured planning method that evaluates those four
elements of a project or business venture. A SWOT analysis can be carried out for a company,
product, place, industry, or person. It involves specifying the objective for the business

venture or project and identifying the internal and external factors that are favorable and
unfavorable to achieve that objective.
Strength
A firms strengths are its resources and capabilities that can be used as a basis for developing
a competitive advantage. Examples of such strengths include:
Patents
Strong brand names
Good reputation among customers
Cost advantages from proprietary know-how
Exclusive access to high grade natural resources
Favorable access to distribution networks

Weakness
The absence of certain strengths may be viewed as a weakness. For example, each of the
following may be considered weaknesses:

Lack of patent protection

A weak brand name
Poor reputation among customers
High cost structure
Lack of access to the best natural resources
Lack of access to key distribution channels

In some cases, a weakness may be the flip side of strength. Take the case in which a firm has a
large amount of manufacturing capacity. While this capacity may be considered a strength that
competitors do not share, it also may be a considered a weakness if the large investment in
manufacturing capacity prevents the firm from reacting quickly to changes in the strategic
environment.

Opportunities

The external environmental analysis may reveal certain new opportunities for profit and
growth. Some examples of such opportunities include:
An unfulfilled customer need
Arrival of new technologies
Loosening of regulations
Removal of international trade barriers

Threats
Changes in the external environmental also may present threats to the firm. Some examples of
such threats include:
Shifts in consumer tastes away from the firms products
Emergence of substitute products
New regulations
Increased trade barriers

Michael Porter Five Forces Model

Porters five forces analysis is a framework tht attempts to analyze the level of competition
within an industry and business strategy development.

Supplier Power
This force addresses how easily suppliers can drive up the price of goods and services. It is
affected by the number of suppliers of key aspects of a good or service, how unique these
aspects are and how much it would cost a company to switch from one supplier to another.
The fewer number of suppliers, and the more a company depends upon a supplier, the more
power a supplier holds.
Buyer Power
This specifically deals with the ability customers have to drive prices down. It is affected by
how many buyers, or customers, a company has, how significant each customer is and how
much it would cost a customer to switch from one company to another. The smaller and
powerful a client base, the more power it holds.
Competitive Rivalry
The importance of this force is the number of competitors and their ability to threaten a
company. The larger the number of competitors, along with the number of equivalent products
and services they offer, dictates the power of a company. Suppliers and buyers seek out a
companys competition if they are unable to receive a suitable deal.
Threat of Substitution
Competitor substitutions that can be used in place of a companys products or services pose a
threat. For example, if customers rely on a company to provide a tool or service that can be
substituted with another tool or service or by performing the task manually, and this
substitution is fairly easy and of low cost, a companys power can be weakened.
Threat of New Entry
A companys power is also affected by the force of new entrants into its market. The less
money and time it costs for a competitor to enter a companys market and be an effective
competitor, the more a companys position may be significantly weakened.

Target Market
A target market is a group of customers a business has decided to aim its marketing efforts
and ultimately its merchandise towards. A well-defined target market is the first element of a
marketing strategy. Product, price, promotion, and place are the four elements of a marketing
mix strategy that determine the success of a product or service in the marketplace. It is proven
that businesses must have a clear definition of their target market as this can help reach its
target consumers and analyze what their needs and suitability are.
A target market is a group of people considered likely to buy a product or service. A target
market consists of customers that share similar characteristics, such as age, location, income
and lifestyle, to which a business directs its marketing efforts and sells its products. As
marketing efforts are becoming increasingly online based, the need to find the right audience
for marketing campaigns is essential. One of the first steps in developing an effective
marketing campaign is determining an appropriate target market so that marketing goals can
be set and implemented.
Target markets can be separated into primary and secondary target markets. Primary target
markets are those market segments to which marketing efforts are primarily directed and
secondary markets are smaller or less important. For instance, the primary target market for a
jewellery store might be middle aged woman who care about fashion, and their secondary
target market could be middle aged men who may want to buy gifts for the women in their
lives.

It is important for a business to identify and select a target market so it can direct its
marketing efforts to that group of customers and better satisfy their needs and wants. This
enables the business to use its marketing resources more efficiently, resulting in more cost and
time efficient marketing efforts. It allows for better understanding of customers and therefore
enables the creation of promotional materials that are more relevant to customer needs. Also,
targeting makes it possible to collect more precise data about customer needs and behaviors
and then analyze that information over time in order to refine market strategies effectively.
Target markets or also known as target consumers are certain clusters of consumers with
similar or the same needs that most businesses target their marketing efforts in order to sell
their products and services.
Market segmentation divides the market into four main sub categories: demographic,
geographic, psychographic and behavioral segmentation. After doing market segmentation the
subdivision market will be much more specific and it is relatively easy to understand
consumer demand, enterprises can determine their own service objects according to their
business ideology, principles and production technology and marketing power. To aim at the
small target market, which is easy to formulate the special marketing strategy. At the same
time, in the segments of the market, the information is easy to understand and feedback, once
the consumer demand changes, enterprises can rapidly change marketing strategy formulated
corresponding countermeasures, in order to adapt to the change of market demand, improve
the flexibility and competitiveness of enterprises. Through market segmentation, the
enterprise will be able to notice every subdivision market purchasing potential, satisfying
degree, competition and comparative analysis, to better meet market needs. Meanwhile, the
manpower, material resources and funds of any enterprise are limited. Through market
segments, after select the suitable target market, enterprises can focus more on human,
financial, and material resources, to flight for the advantages of local market, and then to
occupy their own target market. Segmenting the market allows marketers to better understand
the group they are aiming their message at, which is more efficient than aiming at a broad
group of people.

Demographic segmentation is the process of dividing the total market according to particular
characteristics such as age, gender, family size, family life cycle, income, occupation,
education, religion, race, and nationality. Age and gender are two of the most commonly used
demographic variables used to segment markets. Demographics are useful and widely used
but should be coupled with other segmentation variables to effectively define a target market.
Gender

Due to the physiological differences, male and female have very

different product demand and preferences, for example, in clothing,

Age

hair, and other necessities of life.

Consumers of different ages have different demand characteristics,
for example young people need to dress and the elderly needs are
different, young people need bright, fashionable clothing, the

Income

elderly need dignified and simple but elegant dress.

Lower income and higher income consumers will be quite different
in

Occupation and education

product

selection,

leisure

time

arrangement,

social

communication and communication.

Consumers of different occupation, different education will lead to
different desired product. For example, farmers prefer to buy loadcarrying bicycles while students, teachers love light, beautiful style

Family life cycle

bike.
A family, according to different condition of age, marriage and
children, can be divided into single, new married, full nest, empty
nest and lonely those five stages. In different stages, family
purchasing power, family members of the interest of goods and
preferences will be a great difference.

Geographic segmentation divides the market by location. This could be divided into countries,
cities, towns and neighborhoods. Different geographic locations usually have different aspects
to their environment, which allows marketers to appeal to the specific needs of each location.

Psychographic segmentation is based on personality characteristics, mainly includes the

consumers personality, the life style, the social class, the motive, the value orientation.
Businesses can do this by researching consumers preferences, likes and dislikes, habits,

interests, hobbies, values and socioeconomic group. These variables are concerned with why
people behave the way they do and are often used effectively in conjunction with other
segmentation variables. Psychographics also relates to attitudes toward certain activities like
fitness, willingness to take risks, concern for the environment, political opinions, concern with
fashion, and innovativeness. Values and culture are strongly linked to how people think and
behave and are important aspects of segmentation variables, especially in global campaigns.
Personality traits such as self-esteem, intelligence, and introversion/extroversion also affect
the processing and persuasiveness of communication.
Lifestyle

Lifestyle is a particular habit of individuals or groups in the consumption,

work and entertainment. Different lifestyles tend to produce different
consumer demand and purchase behavior, even on the same kind of goods,
there will be different needs in the quality, appearance, style, and
specifications. Nowadays, many consumers does not only buy goods to meet
the material needs, it is more important to show the performance of their
lifestyle, to meet the psychological needs, such as identify, status, and the

Social class

pursuit of fashion.
Due to the different social class have a different social environment, different
backgrounds, and different characteristics of different consumer preferences,
demand for goods or services are quite different. Philip Kotler divided

Upper uppers
Lower uppers

American society into six classes.

Inheritance property, family background has famous celebrities.
The extraordinary vitality in the occupation or business and get higher income

Upper middles

or wealth.
They are extremely concerned about their careers, they are doing special

Lower middles
Upper lowers
Lower lowers

occupations, independent entrepreneurs and managers.

Middle-income white-collar and blue collar workers.
Low wages, life is just at the poverty line, the pursuit of wealth but no skills.
The poor, often rely on long-term unemployment, or public charity relief to the
people. People in different social classes, the demand for cars, clothing,

Personality

furniture, entertainment, reading, there is a big difference.

Personality refers to the individuals unique psychological characteristics, this
psychological characteristics of individuals and their environment to maintain
a relatively consistent and lasting response. Everyone has a unique personality
affecting their buying behavior. To distinguish between different personality,
there is a strong correlation between the premise and specific personality with
the product or brand choice, so personality can become the market segments of

the psychological variables.

Behavioral segmentation relates to customers knowledge, attitude, use of product and the
purchase occasion, such as special one-off or regular loyal buying. Identifying what
customers want from products and the benefits they seek are important to behavioral
segmentation to allow marketers to better design and select products that satisfy these needs.
Many marketers believe that behavioral variables are the best starting point for market
segmentation.
Opportunity

It is the time consumers buy and use the product. These opportunities include
marriage, divorce, purchase, moving, demolition, admission, study, retirement,
travel, tourism and holidays. It will help improve brand usage and marketing
targeted. For example, travel agencies can provide specialized travel services at
Christmas, stationery enterprises can begin to provide more learning supplies

Benefit

before new semester.

Benefit segmentation is a kind of classification method based on the different
interests of consumers from the brand products. Using the benefit segmentation
method, what must be determined is the benefit people are seeking for, who are
seeking these benefits, how important to them these benefits are, what brand can

User status

offer these benefits, what benefits have not been met.

According to the state of use, consumers can be classified into once users,
nonusers, potential users, the primary user, occasionally users and often user
type, for different type of consumers the brand should use different marketing
strategies and methods. The brand who has a high market share can focus more
on the potential users to change them to the actual users.

Brand loyalty

Consumer loyalty is the most valuable wealth of enterprises. Consumers can be

True Friends

divided into four types according to their brand loyalty.

They are the highest level of the four types and the most important part of the
customer group. For example, a fan of a Swiss knife, they will keep telling their
friends and neighbors the benefits of this knife, their frequency of use. These
loyal customers will be free of charge to the brand, and continue to recommend

Butterflies

to others. For any business, this is the most popular type of customer.
Butterflies are not particularly loyal, but have spent money on your products and
brought in good revenue. An example of a butterfly would be someone that

supports Microsoft in general, but buys the iPhone since it happened to be the
Barnacles

best available on the market.

Here is where some companies, especially B2B companies, find a surprising
amount of their customer base falls into. Barnacles are loyal customers, but they
are loyal customers that rarely make a purchase, and may not bring in much of a
profit. A great example would be a customer that buys one cup of coffee at your
coffee shop, and then comes in every day for the next month to use your free

Strangers

WiFi without making a purchase.

Due to different reasons, some customers are not loyal to certain brands.
Generally speaking, enterprises should avoid targeting strangers, because they
will never become a sincere customer, they have little contribution to the
development of enterprises.

Marketing mix is a tool to help understand what the product or service can offer and how to
plan for a successful product offering.

Product
The product is either a tangible good or an intangible service that is seem to meet a specific
customer need or demand. All products follow a logical product life cycle and it is vital for
marketers to understand and plan for the various stages and their unique challenges. It is the
key to understand those problems that the product is attempting to solve. The benefits offered
by the product and all its features need to be understood.

Price
Price covers the actual amount the end user is expected to pay for a product. How a product is
priced will directly affect how it sells. This is linked to what the perceived value of the
product is to the customer rather than an objective costing of the product on offer. If a product
is priced higher or lower than its perceived value, then it will not sell. If there is a positive
customer value, than a product maybe successfully priced higher than its objective monetary
value. Conversely, if a product has little value in the eyes of the consumer, then it may need to
be underpriced to sell. Price may also be affected by distribution plans, value chain costs and
markups and how competitors price a rival product.
Promotion
The marketing communication strategies and techniques all fall under the promotion heading.
These may include advertising, sales promotions, special offers and public relations.
Whatever the channel used, it is necessary for it to be suitable for the product, the price and
the end user it is being marketed to. It is important to differentiate between marketing and
promotion. Promotion is just the communication aspect of the entire marketing function.
Place

Place or placement has to do with how the product will be provided to the customer.
Distribution is a key element of placement. The placement strategy will help assess what
channel is the most suited to a product. How a product is accessed by the end user also needs
to compliment the rest of the product strategy.
People
People are essential in the marketing of any product or service. In the professional, financial
or hospitality service industry, people are not producers, but rather the products themselves.
When people are the product, they impact public perception of an organization as much as any
tangible consumer goods.

Process
A process could be a sequential order of tasks that an employee undertakes as a part of their
job. It can represent sequential steps taken by a number of various employees while
attempting to complete a task. Some people are responsible for managing multiple processes
at once.
Physical evidence
Physical evidence is the lasting proof that the service has happened. In terms of buying a
physical product, the physical evidence is the product itself. Physical evidence is important to
customers because the tangible goods are evidence that the seller has provided what the
customer was expecting. The more inviting the physical environment that surrounds a product
when it is sold, the more people are willing to pay for said good or service.