If you’re starting a new business, you may be wondering about the differences between marketing plans and business plans. While both are crucial to running a successful company, they have important key differences to understand.
Marketing and business plans are two essential tools, but they serve different purposes. A business plan is a more comprehensive, big-picture overview of your company’s mission. In contrast, a marketing plan is a facet of your business plan that will help you advertise and reach your target audience.
Drafting up these plans may seem daunting at first, but once you understand how they operate, you’ll be prepared to take your business to the next level. This article will break down the difference between a marketing plan and a business plan and how both documents in tangent can help you move forward with your company’s development. Let’s dive in!
One of the most crucial things you can prepare is a business plan when starting or running a company. A business plan is a comprehensive document that outlines the operational and financial goals of a business and its overall strategy for achieving them. A successful business plan includes:
Creating a business plan is crucial because it will help you stay organized and focused on your long-term goals— essentially, it’s a roadmap of how you will achieve success and meet your business’s clearly outlined missions. The plan will aid you in making informed decisions, assessing risks, and measuring progress.
The length and detail of this plan will vary depending on the size and type of business you are running. However, having a solid business plan is essential for any business, especially start-ups. Start-ups often don’t have the resources that more established businesses do, so owners have to work harder to convince investors to fund or loan money to their projects. A business plan can help smaller or newer companies secure loans and other forms of funding.
In the following sections, I’ll outline the various elements you need to create a successful business plan by walking you through all the steps, from writing a summary to creating a budget.
The executive summary is the first section of your business plan, and it should be approximately one to two pages long, depending on the overall size of your report. It should be well written, concise, and capture the essence of your company, as well as your aims and goals. The executive summary is crucial because it will give potential investors and lenders an in-depth look into your business plans.
This summary will represent the entirety of your plan, so make sure the document includes an overview of the following:
With these questions in mind, you’ll be able to write a compelling summary that covers your mission and the steps you’ll take towards achieving your goals.
With the executive summary out of the way, I’ll now walk you through the other essential sections of your business plan.
Products And Services
This part of your report should include detailed descriptions of your business’s products and services. You should have information on pricing, how long your products last, and an overview of the production process, including information about how your goods will be manufactured and delivered.
If you run a start-up or new business, this part of your plan is especially crucial because it will give potential investors a snapshot of what your business offers. It would be best to showcase what makes your brand unique and how you plan to compete in the market. What are your selling points? Why should customers choose you over your competitors? Highlight any benefits of your company to address how they will meet customer demand.
If you have any patents or trademarks, you can include that information here so that potential investors know that your intellectual property is legally protected.
This section should outline who your competitors are and their influence in your chosen field. This analysis can include information about the strengths and weaknesses of your competitors and how difficult it may be to take market share from these businesses.
Doing detailed industry research will also help you identify areas where you could improve on what similar companies are doing. Once you know what is already offered in the market, you can develop competitive strategies to help your product stand out.
The marketing analysis can also detail your projections and expected demand for your products based on competing industries and companies. Knowing how receptive your target audience will be can help you determine your strategy, which I will go over in the next section.
Once you’ve completed your analysis, it’s time to develop a strategy. This section should include your overall plan for how you will attract and maintain a customer base, as well as what advertising methods you will use to appeal to the right target markets.
It would help to tailor your strategy to your ideal buyers, and it should be realistic and achievable. You should consider your company’s strengths and how you can use them to your advantage in the market. For example, suppose you have a solid online presence. In that case, you may want to focus on digital marketing strategies. Or, if you have a niche product, you can find specific sites to target potential customers.
Additionally, you should provide information on the distribution channels you will use. This data may include where you are sourcing your products and how you plan to deliver them to your customers.
You can also specify how your company intends to communicate with customers by having a plan for after-sales service and how you will handle customer complaints or queries.
Financial planning is essential for any business, although the process will look different depending on whether you’re a startup or run an existing company. Regardless of the current state of your business, you should enlist the help of accountants and economists to create a financial plan.
This section should include detailed information on your company's financial status, as well as projections for the future. All of this information will help to give investors a clear picture of your business' financial stability and growth potential.
If you have an existing business, you'll need to include the following documents:
If you’re a start-up, you’ll need to provide estimates for the first few years of operation, including information on expected sales, profits, and expenses. You should also outline how much money you’ll need to get your business off the ground and how you plan to obtain these funds through potential investors.
Determine your long-term goals for your business and how you plan to achieve them through measurable steps. This data should include expected sales revenue and profit margins. You should also have a plan for reinvesting profits back into the company and address how you will cover any future costs or losses.
Financial planning is an ongoing process, so you should update your business plan annually, especially if your company’s financial status changes. Keeping these documents in order will help you stay on track and ensure that your company meets its projected financial goals.
Your budget is a critical element of your financial plan and should prove to investors that you have a sense of how much money to allocate to various parts of your business. You can break down your budget into different sections, including personnel, development, production, and advertising costs.
Additionally, you can include a sales forecast that outlines your expected revenue and profit margins. These projections will help you to determine how much money you need to cover your costs and make a profit within your allotted budget.
A marketing plan is a document that outlines an organization's advertising goals and strategies. It should cover product promotion, pricing, target markets, and advertising. The focus of marketing plans should be to advertise your product to consumers who are likely to purchase from you.
When creating a marketing strategy, you should consider your target audience, research competition in the market, and develop clear goals and strategies. It would help if you also considered what marketing channels you’ll use, including social media advertising, email marketing, influencer marketing, search engine optimization (SEO), content marketing, or other methods.
How Marketing Plans Compare To Business Plans
A marketing plan focuses solely on the marketing aspect of your business, so it is more detailed about this specific part of your plan. On the other hand, a business plan is an overarching document that outlines the company’s missions regarding product development and financial objectives and a brief overview of marketing goals and competitive challenges.
A marketing plan, while important, is less comprehensive and doesn’t provide as much general information about the company. Therefore, it’s important to remember that a marketing plan and a business plan should work together—the marketing plan provides the overall marketing strategy while the business plan offers a detailed roadmap for succeeding on multiple levels.
You can think of a marketing plan as a more detailed part of the overall business plan. The business plan is more important to present to potential investors because it provides a general overview of a company’s mission, but including a detailed marketing plan is an asset that will aid your business plan.
While business plans typically don’t have to be updated frequently, you should review marketing plans periodically to adjust to the outcomes of advertising efforts and marketing trends. Therefore, it is a more pliable document and is easier to adapt as your business changes and grows.
I’ll outline what elements you need to build a successful marketing plan in the following section.
Your marketing objectives should be specific, measurable, achievable, relevant, and time-bound. Here are some solid examples of marketing objectives:
Keep in mind that you should align your objectives with the overall goals of your business. Whether you hope to increase profits or reach more customers, your efforts should reflect those aspirations. For example, suppose you desire to establish a better digital presence. In that case, you can advertise on social media. Or, if you want to improve customer communication, you can launch a live chat on your website.
Market research is the process of analyzing current market trends and adjusting your business strategy to meet the projected direction of the industry. You’ll need to know your current business positioning in the field, which involves taking a close look at target markets.
Your target market should be based on the products or services you offer. If you provide a product that appeals to a wide audience, your target market will be much broader than if you offer a product that only appeals to a niche group.
It’s also essential to understand potential buyers’ interests and where you can advertise to them. Does the majority of your target audience use social media? If so, which platforms? What publications do they read? What TV programs do they watch? You can conduct market research in several ways, including surveys, focus groups, interviews, and observational studies.
Once you have this information, you can begin developing buyer personas. A buyer persona is a fictional representation of your target customer. It includes demographic information like age, gender, income level, and job title, as well as your buyer persona’s interests, values, and needs. This information will help you determine where to focus your marketing efforts.You can also check out my article about data collection tools to help you complete market research more efficiently.
It's essential to understand your competition and stand out in the field if you want to succeed in the market. One of the most important things to do is research similar businesses. To learn about them, you can visit their stores or websites. What are they offering? What prices are they charging? How are they promoting their products? What do their customers say about them in reviews?
Once you find out what they offer, how much they charge, and how they’re promoting themselves, you’ll be able to address any flaws your competitors may have and develop schemes that are unique to your business.
You can also use tools like the SWOT analysis to analyze your competitors’ strengths and weaknesses. This information can help you decide which strategies to use by addressing both internal and external factors.
Now that you understand how to conduct market research and evaluate competing businesses, let’s look at the various strategies you can implement to ensure that your advertising efforts elevate your business.
A marketing mix combines marketing activities that you use to reach your target audience—product, price, place, and promotion.
The product description should include information on what you are selling, how you source it, and the benefits that it will provide to potential buyers. You can include high-quality images or models to showcase these goods.
You’ll also need to include price information, including how much it costs to produce your product and what price you are selling it for, based on your market research on similar items.
The place category will determine where customers can purchase your product. You can outline where your goods will be available, whether on online marketplaces, your website, or in-store.
The promotion section will include information on your advertising campaigns, including email campaigns, social media campaigns, SEO optimization, and more.
Now that you have your objectives and marketing mix in place, it’s time to implement them. Each activity should have a goal associated with it. For example, if one of your goals is to increase website traffic, your next move could be to promote a contest on social media. Or, if you want to raise brand awareness, you can reach out to influencers for a paid partnership.
The more specific information you have about this audience, the better chance of reaching potential customers through advertising campaigns or social media posts that speak directly to their interests and concerns. If done correctly, this could lead to higher conversion rates from potential customers, as well as increased brand awareness among those who may not have been aware of your product before seeing these advertisements.
You should also allocate a budget for each objective and a timeframe for completing your goals. Be realistic about what you can achieve in the given timeframe, and make sure you allow enough time to see the results of your efforts.
Key Performance Indicators (KPI)
Key Performance Indicators (KPI) are metrics that measure how well you’re achieving your objectives. There are many different KPIs you can use, depending on your goals. Common KPIs include website traffic, conversion rate, leads generated, and customer satisfaction. You can also check out my article about how to use KPIs for email marketing for more ideas about KPIs that you can set in your business.
You should track your KPIs regularly and adjust your marketing activities as needed. If you find that you’re not achieving your goals, it’s time to reevaluate your plan and make changes.
Though you will likely already have an overall budget at this point in your business plan, the marketing budget can provide more detail on the distribution of your company’s financial resources towards advertising and promotions.
You should determine what percentage of your funds will go towards advertising efforts— the general advice is between 6-20% of your total budget.
How A Marketing Plan And A Business Plan Work Together
Companies should have both a business and marketing plan—the business plan outlines the structure and goals of the company. In contrast, the marketing plan explains how you will achieve those goals through marketing activities. If you seek loans or meet with investors, having both of these documents at the ready will benefit your business.
I’ve already established their different purposes, but when used together, there are many benefits to having these documents.
These range from increased sales to more realistic projections. The following section will detail the perks of creating and implementing both plans.
Business plans define the company’s goals, and the marketing plan provides specific steps to achieve these aims. When you have both plans in place, it’s easier to track your progress and make changes as needed, increasing the chances of achieving your objectives and improving sales.
If the overall goals of the business change, the marketing plan may also need to be altered. For example, if the business decides to focus on international sales, the marketing plan will need to reflect this change. Luckily, marketing plans are easier to update, so you can adjust the details as your business expands and evolves.
The more detail you put into these plans, the more likely you are to reliably and consistently track your progress based on your preset goals. While drafting them may be a lot of work initially, staying organized and adjusting your plans as needed will help increase sales in the long-run.
When creating these plans, it’s important to be realistic about what you can achieve by setting achievable goals and estimating the time it will take to complete each activity.
Once you write these plans, you’ll have a better idea of initial projections based on the in-depth market research required to make a budget and set your prices. You’ll also have more information about how to accurately track your marketing efforts using data collection tools and KPIs.
If the business plan and marketing plan are consistent, it will be easier to achieve your objectives. The business plan provides a broad overview of the company, while the marketing plan explains how each marketing activity will help achieve the business’s goals.
Having these plans in place makes it easier to keep your business on track and on-brand. You can adjust your marketing plan as you go to keep up with new objectives or projects, keeping your business organized and streamlined.
Surpassing Your Competition
Creating these plans will help you surpass your competitors—when you clearly understand what you’re up against, it’s easier to create a strategy that will help you stand out.
Business plans help you understand your competition, like what strategies work and what aspects you can improve on. This knowledge will allow you to use your funds and resources on marketing channels to bring optimal value and income.
Once you have implemented these plans, it’s essential to monitor their effectiveness. By keeping track of how well your company matches your projections, you can identify patterns and adapt these plans according to your future goals.
Your business plan can be reviewed annually, which will give you an overview of where you are meeting your goals and what areas you may be falling short in. Does your work meet the standards and guidelines you initially planned?
In comparison, you should review marketing methods quarterly to track which ones are working best and which you can adjust to run your operation more successfully.
FAQ—Marketing Plan vs. Business Plan
A marketing plan is a component of a business plan, but it is not the same thing. A business plan provides a structure and goals for the company, while the marketing plan explains how each marketing activity will help achieve those goals.
Creating a business plan before making a marketing plan is generally recommended. Keep in mind that the two projects should be consistent with each other and work together to present the most comprehensive, detailed overview of your business goals as possible.
Business plans are longer, more comprehensive documents that cover all aspects of your company’s operations and include the following:
Alternatively, marketing plans cover only the marketing aspect of your company and address the following areas:
While these plans serve different purposes, they can be used together to present an in-depth overview of your company to potential investors and are both valuable assets to track your business goals, successes, and areas to improve on.
Although a business plan and marketing plan are two different documents, they work together to create a well-rounded view of the company. A good business plan will have realistic goals based on sound market analysis, while a good marketing plan will outline specific objectives to help achieve those projections.
When these two plans are put together, they can increase sales, create realistic projections, and help your business overcome competitive challenges. Therefore, drafting both is essential for having an organized, consistent, and lucrative business.
So, what are you waiting for? Using this guide for reference, start creating your marketing and business plans today!