Business Development > Marketing > Understanding Marketing
Updated October, 2022
File C5-15
A Marketing Primer for Businesses*
A basic understanding of the scope of marketing, and the questions raised therein, can help a value-added venture immensely. You may be well versed in the terminology and concepts of marketing as they relate to agricultural production. What applies under that umbrella is still important, and the scope of your marketing considerations enlarges when you become involved in processing or other start-up business frameworks.
So what is this "thing" called marketing?
- It is something different to every person.
- It is studying.
- It is analyzing.
- It is making decisions about how to reach your goals.
Your Business Plan and your Marketing Plan go hand-in-hand. You probably cannot successfully carry out either effort without the other. Right in your business plan, you will deal with the basic outline of how you will market your product.
But a more expanded marketing plan can provide that necessary information as well as take you on to the levels of how you carry out your strategies and who is going to perform certain tasks.
To establish a full-fledged marketing plan, keep a couple of things in mind:
1. You have to be noticed - you can’t get lost in other people’s "bigger picture."
2. Good marketing and image creation evolve of time.
With increased marketing through social media networks, the average customer or consumer is exposed to over 5,000 different advertising images each day. This figure is more than double industry estimates from 10-15 years ago. The vast majority of these are forgotten in less than 24 hours. After two weeks, only 5% of these images are remembered. Consider that over that two-week period, each day brings in another 5,000+ images, some of which reinforce the previous day’s images, some of which are new.
It’s easy to get the feeling you are on a racetrack and all the other cars are accelerating and passing you by - repeatedly. Actually, you stand as good a chance as anyone of being the remembered (and acted upon) image if you are smart about it. A key element in marketing is to be consistent, frequent, and on target with your messages - all the messages you send out.
As mentioned earlier, you will need a marketing plan. It is a working document, and one that changes as your business plan changes. This plan is one of building on what you know about yourself, defining steps to reach goals, and turning one success into a group of them.
Unbreakable Rules
There are two common-sense, cardinal rules to continually keep in mind.
Rule 1: Know your Customer(s).
Rule 2: Know your Competition.
Marketing is not just about sales, although making good sales at the right time and price is always a factor. Instead, marketing is everything you do in terms of addressing your customers and in relation to your competition. These activities probably will lead to improved sales as an outcome.
In your previous working endeavors, you and others have been focused on one or two of the components in what marketing gurus frequently call the "Four Ps of Marketing." They are price, product, place and promotion.
Roll these together and then add image or positioning. None of the factors can be considered in isolation from the other. And all are considered in relation to the two basic rules of knowing customer(s) and knowing competition.
Sound complicated? It can be, but it doesn’t have to be. Your best approach is to have as much information as possible about clients, potential clients, competitors and, of course, your own product and business capacity. This means doing marketing research.
There are a couple of cautions to keep in mind. You do not want to limit those you query to those who are a built-in market for your product or supporters of your ideas. Supportive attitudes and answers can make you feel good, really good, for a very short period of time. Depending on your product and sales goals, you need to know what a chunk of “the rest of the world” thinks. All of that feel-good information can cause you to build a marketing and business plan that will not take you to the success you want.
Marketing Framework
Below is a diagram of the marketing framework. This will help you understand the process of investigating and understanding your markets. As discussed above, you will need to gather information about your customers, your potential customers and your competition.
You also need to know the climate in which both you and your customers are operating. You may be able to do this simply with a meeting among you and your partners, associates, etc. Or, you may wish to consider surveying or questioning others for this information. This is called environmental scanning. While it may not seem relevant at the time of beginning your operation, you don’t want to be caught by surprise by events that occur over which you have no control. You need to know where you are sitting in the larger scheme of things.
You should know about the current political climate as it relates to your product. Also, what factors in the economy (regionally, nationally or world-wide) could affect your situation or your customers’ buying ability? What trends related to your product area exist?
You may be able to do all of the information gathering yourself or with your own staff or partners. Probably, it will be money well invested to hire some assistance in this area. You have a big job simply in using the findings of research to make your product, production and sales decisions.
This information will help you connect with the customers you expect to reach and the customers you can potentially reach. It will also help you connect with the community and other operatives or stakeholders in your project such as lenders, investors, etc.
*Reprinted with permission Agricultural Marketing Resource Center, Iowa State University.
Helen K. Randall, HKR Communications & Marketing, Des Moines, Iowa