The business analysis section of this plan is a very useful exercise. Not only will you gain understanding of the business environment for your idea, but you will also have great usable content to add into the formal business plan. Sometimes this part of the process is an eye-opener and we may realize that this idea may not be the best business opportunity. Other times, we receive affirmation in our research. Some information inside of this section, we will know already from earlier sections and other information we will need to research.
Personally, I find this to be the most interesting section of any plan to complete. Many investors do similar research on their own prior to making an investment. You not only want to know your business, but you will also want to know the entire ecosystem around it and that is what this analysis provides.
This research will be useful to your marketing team and they may be able to find great promotional angles and opportunities that you may not have considered at first glance. While this plan is for you to be clear, concise and organize your strategy, it is also for you to put your thoughts into writing and better learn the overall ecosystem. This will also be used by your marketing team to use as a resource, investors to review for consideration information, and more. As we proceed, we should act neutral, preforming the analysis as if we were a capital investor and not a founder.
As we begin our Business Analysis segment of our marketing plan, we need to start with analyzing our company. There are many factors to consider as you write this section of your Marketing Plan. The following questions will help to create your plan: What makes your company unique over all others? Who makes up your team? What experience does your team have?
From our previous posts on the market, you should have a good idea of what to include in your customer analysis. This should include types of customers, their demographics, buying patterns, and the “hot buttons” or things that would trigger them to purchase your product.
The analysis can go much deeper into this statistically and provide percentages of the overall market that fit within that customer segment. The more detailed you can be in this section, the better your team and yourself will understand, which prospects best fit your company.
As we mentioned earlier, if a business does not have any competition, it can signal a problem. In our competitor analysis, we need to also consider indirect competition as well. If we sold staplers, a paperclip company might not seem like a competitor, but they do offer a similar solution. They are not selling the same product as us, but it could solve the customer’s problem. We need to account for all possible competitors. As stated prior, if you are the only restaurant in town, you still have the indirect competition of people cooking at home.
What I like to do in a competitor analysis is layout a table to analysis the competition, both direct and indirect.
My table includes:
1) Competitor’s Name
2) Direct or Indirect
4) Primary Service or Product Offering
5) Differences Between Our Solution
6) Advantage of Our Company Over Competitor
7) Estimated Market share
Estimating a competitor’s market share could pose a challenge. If you struggle with this, find a ranking mechanism to rate competitors and their overall impact on your market. The higher this ranking, the more you will want to build upon your differentiating qualities that stand out against that competitor.
To be successful in anything you do it is important to have a team of collaborators. This all falls into our analysis of the business. In a business plan, I would go more in detail with legal, accounting and other advisors you collaborate with, but for your marketing plan, focus it on businesses or individuals that you are going to collaborate to promote your marketing efforts.
One example of this could be an advertising agency that you are going to collaborate with to determine radio advertising placement or billboard usage strategies.
Another example could be a local restaurant you are going to collaborate with to cross promote. For our car dealership example, a sports bar could be a collaborator. We could have them promote our vehicles for sale and in return give them a referral or finder fee when they send a buyer our way.
There can be multiple forms of collaborators and these all very from industry to industry. For nearly all businesses, you will want to find a web and user experience collaborator. They would be a resource that you could use to keep the branding on your site consistent and convey your business message.
I have found that finding a shared interest with other companies creates a great collaboration opportunity to share clients and refer leads to one another mutually. This doesn’t cost anything and builds great community relationships that benefit both organizations.
As we discussed in the last chapter, knowing the macro-economic climate and how its factors will impact your business is very important. If you want to open a warehouse and manufacturing facility and the macro-economic climate has a high unemployment rate, that could indicate that there are a lot of people seeking employment and that wages could be competitive towards your benefit.
On the other hand, if unemployment is low and the type of labor you are looking for is more limited, then you may have a more difficult time hiring and have to pay higher than average salaries to entice someone to choose your company.
Of course, there is more than unemployment rates to consider as we discussed earlier, but this is the section to review factors that you cannot control and how they will benefit or create a challenge for the business.
Our Business Analysis section of our marketing plan should go more in-depth as we look at our strengths, opportunities, weaknesses, and threats.
Some choose to use a table and others like to use a general outline. The one crucial element is to not be afraid to list your weaknesses and threats. These are so important to your success. Sometimes we are blinded by our opportunities and strengths that we miss something that could derail our progress as we grow. With researching, forecasting, and documenting everything within the ecosystem, we can be well prepared for most things that come our way. Figure A, is the SWOT Matrix that we used in the a previous post. Use this as a reference to guide your SWOT analysis.
Figure A. SWOT MATRIX Example
|Aggressive marketing campaign with clear and measurable goals and a well-defined customer demographic. Management team is experienced in the product and business.||Business growth has caused quick expansion with many new hires to train and new organizational structure needs. Being a new brewery, we lack the reputation and capital that big brew houses have.|
|Growing consumers who have a desire to find high-end beverages and bottles. Industry awareness and expansion exceeds standard industry growth.||Current State government restrictions on shipping alcohol. Growing competitive market with more businesses entering the space.|