For the first six (6) months your company is in business—to give you time to perfect your product and to learn from actual customers—you will start marketing and selling in your own community, a radius of twenty-five (25) miles from where you live.
For most non-alcoholic beverages, marketing (as opposed to the actual product itself) is key to success. Cola drinks, for example, are fairly undifferentiated, as are many energy drinks, juices, bottled water, and the like. Companies producing these types of beverages differentiate themselves and attract market share through marketing and brand awareness—both of which are critical to success.
Section 1: Marketing Plan & Sales Strategy (MS Word or equivalent)
Write the three to five (3-5) page Marketing Plan & Sales Strategy section of your business plan, in which you:
Define your company’s target market.
Analyze the types of consumers who will be drinking your beverage in demographic terms (i.e., age, education level, income, gender, ethnic group, etc.). Support your analysis with actual data on the size of the demographic groups in your local community (nearby zip codes).
Outline the demographic information for your company specified on the worksheet in the course text (p. 107 | Demographic Description). Click here for help accessing a specific page number in your eBook.
Hints: At American FactFinder (http://census.gov), you will find demographic information on potential consumers in your area. If you are selling through other businesses (such as grocery stores), indicate the number of those businesses in your local area. You will find information about such businesses in your local area at County Business Patterns (http://www.census.gov/econ/cbp/). Check Chapter 2 of Successful Business Plan for more research sources.
Assess your company’s market competition.
Use the factors listed in the course text graphic (p. 123 | Assess the Competition) to assess your company’s market competition.
Defend your strategy to successfully compete against market leaders in your segment.
Hints: For example, in the soft drink market, it is intimidating to try to compete against Coke and Pepsi. Newcomers in mature markets typically must pursue niche markets or even create new market categories, as Red Bull did with energy drinks.
Defend your plan to differentiate yourself from the competition using the information detailed on the worksheet in the text (p. 131 | Market Share Distribution).
Hints: Every business faces competition and the non-alcoholic beverage market is an especially crowded market.
Section 2 uses the “Business Plan Financials” MS Excel template (see: Course Required Files in Week 1). Use the “Business Plan Financials Guide” (see: Course Required Files in Week 1) to support your development of the Marketing Budget.
Complete the Marketing Budget worksheet for your company.
Hints: The goal of the marketing budget is to help you determine how much it will cost you to reach your market and achieve your sales goals.
Hints: When filling out the “Marketing Budget” worksheet in the Excel spreadsheet:
Begin in the current year and complete a marketing budget for the first year of your business. The information you enter in the marketing budget spreadsheet will flow through to your “Income Statement” in the Business Plan Financials.
Leave the number at zero (0) for any marketing vehicles you do not intend to use.
Remember that all marketing activities involve costs. If social media represents a significant portion of your marketing, assume you will have cost of advertising and that should be reflected on your budget. Even if a social media site charges nothing to use it, you will need to use company resources to manage the site, pay someone to execute your social media marketing campaigns, and will most likely pay for ads on that site.
Do NOT leave the “Marketing Budget” blank, assuming you will not have any marketing costs.