Why is marketing planning and forecasting so important?
Marketing is daunting to many, never mind planning and forecasting. As always, we aim to keep marketing simple, which is exactly what we’ll do here in explaining market planning and forecasting.
What is market planning?
Marketing planning is the process of organising a business’s market aims and defining these. The next step covers off how you are going to get there – the tactics, together with the most suitable mix of marketing activities that will help you reach what you are aiming for.
Equally as important – market forecasting.
Market forecasting looks at future trends, characteristics and numbers in your target market – crucial for backing up your plan with facts. Furthermore, this provides deeper insights on ideas and developments to know what is likely, or unlikely to work before investing resource, time, and money. Overall, market forecasts help reduce uncertainty.
Be inspired and get the rewards
Market planning and forecasting are a source of inspiration, ideas and opportunities, with which come rewards.
Market planning gives much-needed guidance to business owners, whether they’re a start-up or long-term established SME. Get ahead and make informed decisions based on market and industry insights – a great way to avoid haphazard ideas. A marketing plan provides focus and actions aimed at achieving the goals of your business. If your marketing isn’t working towards your goals, STOP. Not only does a market plan help maintain focus, it offers structure to resources.
A whopping 20% of new businesses fail in the first year, and 60% bust after three years (Source: x ).
Imagine getting to your third year to lose it all.
Start-up businesses need solid marketing foundation
A simple marketing strategy, marketing plan and regular results reviews will keep you on-track to reach your business goals, and also offer your business real structure, so that you don’t become a statistic.
Forecasting helps you see the bigger picture
Market forecasting is just as important as planning. It gives business owners and SMEs guidance on significant factors like predicted sales, sales costs, potential market growth and market share. Moreover, the Managing Director is equipped with knowledge, and you know what they say about that don’t you.
Market forecasting also shows what’s expected and future potential. It guides the number of sales and can advise on possible savings for crucial overheads like rent, etc. Because a forecast is a prediction, assumptions do have to be made. The more accurate the premises are, the more precise the forecast will be. It’s therefore essential to consider questions like:
- How much will the market grow?
- What are the patterns of consumer behaviour i.e., seasonality periods of low and higher spending?
- Where do we need to increase marketing activities?
It’s essential to ask questions like this to develop workarounds and contingency plans. Knowing when to purchase more and when to reinvest your capital back into the business can make a big difference to creating a predictable future and turnover.
Overall, start-ups, micro-businesses and SMEs can make great use of these two tools to arm them with much more knowledge on the market and consumers to benefit your company. Especially new companies that are still trying to establish themselves within the market.