A fourth shop, and one week to think: Lena's Bakery Ltd has signed the lease on a fourth shop, on Station Road, next to the railway station. It opens in September 2026.
Marco wants
- To print 5,000 leaflets tomorrow
- To hand them out on the platform
Lena asks for one week first
- Before they spend a dollar, she wants to write down what the shop's marketing has to do
- And how they will know whether it did it
That written document is a marketing plan. It sets out what a business wants its marketing to achieve, who it is aimed at, what the business will do, what it will cost, when each step happens and how the business will check that it worked.
Working all of that out, and keeping it up to date once the shop is open, is marketing planning.
Four questions every marketing plan answers
Where are we now?
What the business knows about its customers, its rivals and itself. For Station Road: 1,850 people pass the door between 6.30 and 9.00 each weekday morning, the station handles 4,200 passengers a day, and Crumbline plc sells sandwiches on the platform.
Where do we want to be?
The targets. Lena writes: 300 customers a day at Station Road by the end of the third month.
How will we get there?
Who the shop is for, what it sells and at what price, how people hear about it, and the money and the dates for each step.
How will we know?
How results are checked against the targets. The till counts customers, and Lena compares the count with the target at the end of every month.
A plan, not a wish: 'Hand out leaflets and see' is an action, not a plan. It has no target to aim at, no budget, no date and no way of telling whether it worked.
A marketing plan turns that action into something the whole business can follow and check.
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Lena's plan for Station Road runs to four pages. Each part answers one of the four questions, and each part has something in it that a person can act on.
| Part of the plan | What it says | In Lena's plan for Station Road |
|---|---|---|
| Market analysis | What the business has found out about its customers, its rivals and the trends | 1,850 people pass between 6.30 and 9.00 a.m.; 4,200 rail passengers a day; Crumbline plc sells sandwiches on the platform; no bakery within ten minutes' walk |
| Marketing objectives | What the marketing must achieve, with a number and a date | 300 customers a day by the end of month three (November) |
| Target market | The group of customers the plan is aimed at | Commuters on the morning trains who want breakfast to take away |
| Marketing strategy | How the target will be reached: what is sold, at what price, where, and how people hear about it (the marketing mix) | Pastries and coffee from 6.30 a.m.; the $3 loaf; leaflets and a poster in the station; a free-tasting week |
| Budget | How much the marketing may spend, and on what | $15,000 for the first three months |
| Timescale | When each step happens | Leaflets two weeks before opening; tasting in week one; online adverts in weeks 2 to 12 |
| Evaluation | How results will be checked against the objectives | Count customers at the till every day; compare with the target at the end of each month |
Two parts you have met before. The objective works like the business objectives in topic 1.3: it names one thing, has a number and a date, and can be checked. The target market is the segment the business chose to aim at, as in topic 4.1.
Many businesses sum up the market analysis in four boxes (a SWOT analysis): the business's own strengths and weaknesses, and the opportunities and threats outside it. Crumbline on the platform is a threat; 1,850 people passing each morning with no bakery nearby is an opportunity.
| Where the $15,000 goes | Cost |
|---|---|
| Free-tasting week | $2,000 |
| Leaflets at the station | $1,500 |
| Poster in the station, three months | $6,000 |
| Online adverts, weeks 2 to 12 | $3,000 |
| Loyalty cards | $1,000 |
| Kept back for surprises | $1,500 |
| Total | $15,000 |
Every part points at the objective: A budget with no objective is just spending. An objective with no budget or dates is just a wish.
In a good plan each part serves the target: the leaflets and the poster reach commuters, the tasting week brings them in, and the till count shows whether 300 a day is coming.
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The bank asks first: Station Road costs $120,000 to open, and the bakery is asking its bank for a five-year loan at 8% to pay for it.
How the plan wins the loan
The bank's question
Before the loan is agreed, the bank manager asks one question: how will the new shop find its customers?
Lena's answer
Lena hands over the marketing plan. It shows the 1,850 people who pass each morning, the target of 300 a day (about one in six of them), the $15,000 budget and the dates.
The result
The loan is agreed.
Raising finance is one reason a business writes a marketing plan. The others come from the same place: once the plan is written down, everyone can see it, follow it and check it.
Everyone pulls the same way
- Clear direction: every manager knows the target is 300 customers a day, not just more
- Coordination: Priti plans 600 extra pastries and a longer night shift for the tasting week
- Shop staff know the opening hours, the offers and the dates before the doors open
Money goes where it counts
- The $15,000 is split before any is spent, so no single idea eats all of it
- Marco's leaflets become $1,500 of a planned budget, not the whole of it
- Choices start from research rather than a hunch, which lowers the risk
Progress can be checked
- The target is a yardstick: 170 customers a day in month one against 150 planned
- Problems show early, while there is still money and time to act
- Lenders and investors can see how the money will be used, so finance is easier to raise
The role of marketing planning, in one line: A marketing plan gives the marketing a target, a route, a budget and a way to check. That is what makes it more than a list of ideas.
A plan is only as good as the information it was written with, and the market does not stand still while the plan is followed.
Week six: In week six, Crumbline plc opens a coffee kiosk inside the station. It sells a coffee and a pastry for $3.50, on the platform, so commuters never need to leave the station.
Nothing in Lena's plan expected it.
| Target (customers a day) | Actual (customers a day) | Actual as a share of the target | |
|---|---|---|---|
| Month 1 (September) | 150 | 170 | 170 ÷ 150 × 100 = 113% |
| Month 2 (October) | 225 | 190 | 190 ÷ 225 × 100 = 84% |
| Month 3 (November) | 300 | 210 | 210 ÷ 300 × 100 = 70% |
September beat the target. From week six, in mid-October, the gap opens, and by month three the shop reaches 70% of what the plan asked for. The plan did its job here: without a target, 210 customers a day might have looked fine.
Four limits of a marketing plan
It takes time and money
Lena spent a week on research and writing when the shop could already have been advertising. A small business may not have that week to spare.
It rests on research and guesses
The target of 300 came from counting commuters and guessing how many would stop. If the guess is wrong, every number built on it is wrong too.
It goes out of date
Crumbline's kiosk changed the market in a single week. A plan written in the summer described a market that had changed by October.
It can make managers rigid
Spending the last $2,000 on the same poster because the plan says so would ignore what the till is saying.
Review it, do not throw it away: At the end of October, month two, Lena reviews the plan.
What stays
- The objective
- The target market
- The check
What changes
- The actions: the last $2,000 of poster money moves into a morning deal, a coffee and any pastry for $3, aimed at the same commuters
- The date: the target of 300 moves from month three (November) to month five (January)
Planning is a cycle: That is marketing planning as a cycle: plan, act, check, adjust.
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How this comes up: Questions on marketing planning are short. There are three kinds.
The three questions
- Define a marketing plan, for two marks.
- Explain one benefit, or one limitation, of a marketing plan, for two: name it, then show how it works.
- With a case: explain one advantage and one disadvantage for a named business of writing a marketing plan, for four, where each half needs something from the case.
The four-mark pattern
- Name the advantage. A marketing plan gives everyone the same target and dates, so the parts of the business can work together.
- Show it in the case. Priti knows the free-tasting week needs 600 extra pastries, so she plans the night shift weeks ahead.
- Name the disadvantage. A plan rests on research and guesses, and the market can change after it is written.
- Show it in the case. Crumbline's kiosk opened in week six, and by month three the shop had 210 customers a day against a target of 300.
Trap 1: what is in a plan is not why it helps: 'It has a budget and a timescale' lists contents. A benefit says what that does for the business: the money is split before any of it is spent.
Trap 2: no case, no second mark: 'It gives direction' is one mark. 'Every manager knows the target is 300 customers a day at Station Road' is two.
Explain one advantage and one disadvantage for Lena's Bakery of writing a marketing plan for its new Station Road shop.
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