Business Plan vs Marketing Plan
Business plan and marketing plan are two common types of plans and the difference between them are clearly specified in commerce and management disciplines. As the terms imply, business plans cover all the areas of a business while marketing plans covers only the marketing aspect of a business. Business plans usually develop in start-up businesses mentioning all the strategies and actions required to run the business including all the functional areas. But, in the case of marketing plans, all the necessary actions relating to the marketing function is highlighted and marketing strategies are proposed in the plan. Also, in most of the cases, business plans are developed in business formation while marketing plans are developed in established businesses to achieve desired marketing objectives.
What is Business Plan?
A business plan refers to a document, which covers all the areas of a proposed business, mentioning the ways and means of developing a business to achieve an end state of affairs. Usually, business plans are developed in business formations. But, it does not imply that established ventures cannot develop business plans. Often, start-up businesses develop business plans when they hope to finance from financial intuitions. For example, an established business may develop a business plan if they intend to merge with another competitor. It is important to identify that there are different interpretations of business plans suggesting steps. Therefore, this note entails the commonly accepted steps of a business plan which Barringer & Ireland (2008) suggested.
Contents of a Business Plan:
In the case of business formation, a typical business plan details about the proposed business first. The prime motive to develop such a business, and the importance of the business to the environment is highlighted here. Secondly, the plan proceeds to describe the proposed product or the service. Depending on the concept, a specification of the product is required in this section. Sometimes, entrepreneurs write technical specifications of the product as well. Subsequently, facts in relation to competitors and marketing are detailed. Potential competitors of the business and strategies of winning the marketing competition are detailed in this section. Most importantly, the target market and consumers are described in this section. After that, the operational plan defines how the proposed business implements the idea. Depending on the nature of the product or the service a viable (feasible) implementation strategy is proposed here. The financial plan defines all the financial projections of the business. Only pro-foma (i.e. projected) financial statements and cash flow statements are developed in incorporating Break Even Analysis and forecasted financial outcomes. It is very important to note that, in the section of financial analysis sophisticated financial projections are not required as the business is in the development stages. Furthermore, the plan details the personnel of the business and their responsibilities of the business.
What is Marketing Plan?
Not like in business plans, marketing plans details all the pertaining aspects of marketing strategies in order to achieve a stated marketing objective. For example, a company can develop a marketing plan when they are launching a new product. Therefore, a marketing plan is required to reap the optimum results from the product the company launches. Commonly, marketing plans requires environmental analysis initially. The pertaining marketing environment is described, and the forces are detailed in relation to competition, economy, political, regulatory and legal, sociocultural and technological factors (PESTEL Analysis). Thereafter, the plan describes the desired target market. Importantly, a clear definition of the target market and the industry is required because identification of feasible target market determines success or the failure of a business. A SWOT analysis is performed subsequently, to determine internal strengths and weaknesses and external opportunities and threats of the proposed marketing initiative. By implementing this strategic tool, the company can identify possible strategies of overcoming the limitations of the proposed marketing initiative and factors that have the capability to develop further (i.e. strengths). Afterwards, marketing objectives and the marketing mix is detailed in the plan. Finally, the implementation plan is proposed highlighting activities, timetables, completion times, and responsibilities of personnel involved.
What is the difference between Business Plan and Marketing Plan?
• Definitions of Business Plan and Marketing Plan:
• Business plans is a document that describes an overview of the proposed business incorporating all the functional areas.
• A marketing plan is a document that describes marketing strategies to achieve a marketing initiative.
• Objective:
• Usually, business plans are compiled to obtain finance from financial institutions.
• Usually, marketing plans are compiled as a guidance to achieve a marketing initiative.
• Steps:
• Business Plan:
Commonly accepted steps of a business plan are,
• Executive summary
• Description of the business
• Analysis of the market
• Assessment of competitors
• Marketing plan
• Operational plan
• Finance and human resources
• Marketing Plan:
Commonly accepted steps of a marketing plan are,
• Executive summary
• Environmental analysis
• The marketing environment
• Target markets
• SWOT analysis
• Marketing objectives and strategies
• Marketing mix
• Marketing implementation
• Evaluation and control
References:
- Barringer , B., & Ireland , D. (2008). Entrepreneurship: Successfully Launching New Ventures (Global edition of 4th revised ed.). Pearson Education.
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