The Marketing Audit

The marketing audit has certain similarities to a financial audit in that it is a review or appraisal of your existing marketing activities. Carrying out the marketing audit provides the opportunity to review and appraise your whole marketing activity, enabling you to assess past and present performance as well as to provide the basis for evaluating possible future courses of action. Because the business environment is constantly changing, the marketing audit should be used as a reference tool, with constant updates reflecting changes in the external environment and your own internal business experiences.

1. External Audit
External factors can be split broadly into three groups, the economic environment, the competitive environment and your own market environment. Consider these areas from your own business's point of view - will any changes have an impact on your business, will they affect your competitors, will they allow you to compete where you could not, or inhibit your ability to compete. If the answer is yes, then the factors should be included in the audit. With the advent of the internet, there are now many sources of information on your competitors and your environment. You may also be surprised how much business information is available from your nearest city library. And remember, Company Reports are a good source of competitive information and can be found at www.companieshouse.gov.uk.

1.1 The Economic Environment

Political Government actions, tax levels, privatisation, schools policy etc

Economic

Income levels, employment levels, rate of inflation, rate of economic growth

Social and Cultural

Demographics (population growth/distribution, age), lifestyles and cultural values (changing beliefs, skills, family values)

Technological

IT, internet, home shopping

Legal

UK Law (health & safety, employment law, store opening etc), EU Law

Environmental

Affect of your business on environment, 'green' credentials

1.2 Competitive Environment

How competitive is your market? What are your competitors doing, likely to be doing? Evaluate the following:

The threat of new entrants to your industry The threat of substitute products The bargaining power of customers The bargaining power of suppliers The rivalry amongst current competitors Who are your competitors? Who are your major competitors, how big are they, what is their market share? What reputation do they have? How do they distribute their products, what are their production capabilities? What is their marketing like - do they diversify? What are their key strengths and weaknesses?

1.3 The Market Environment

Total market size growth and trends Market characteristics, growth and trends Products, prices Physical distribution channels Customers/consumers Industry practices

2. Internal Audit
This is your opportunity to put your own business under the microscope - do you know as much about your own situation as you should?

Sales (total, split by geography, industry, customer, product) Market shares Profit margins Costs Marketing information research Effectiveness of marketing mix

Key outcomes from this audit can then be summarised in the Current Market Position and Market Overview sections of your marketing plan.

How to Write a Marketing Plan

The Marketing Plan is a highly detailed, heavily researched and, hopefully,

well written report that many inside and possibly outside the organization will evaluate. In many respects, the Marketing Plan is the most important document produced by marketers as it not only helps to justify what has occurred in the past, but is critical for explaining where a company intends to go in the future. Th Marketing Plan is widely used by both large large corporate marketing departments and also by small startup companies. It is particularly important for marketers who seek funding for new projects or to expand existing products or services. Essentially the Marketing Plan:

forces the marketing personnel to look internally in order to fully understand the results of past marketing decisions. forces the marketing personnel to look externally in order to fully understand the market in which they operate. sets future goals and provides direction for future marketing efforts that everyone within the organization should understand and support. is a key component in obtaining funding to pursue new initiatives.

The Marketing Plan is generally undertaken for one of the following reasons: 1. Needed as part of the yearly planning process within the marketing functional area. 2. Needed for a specialized strategy to introduce something new, such as new product planning, entering new markets, or trying a new strategy to fix an existing problem.

3. Is a component within an overall business plan, such as a new business proposal to the financial community.
There are many ways to develop and format a marketing plan. The approach taken here is to present a 6Part plan that includes: 1. Purpose and Mission 2. Situational Analysis 3. Marketing Strategy and Objectives 4. Tactical Programs 5. Budgets, Performance Analysis and Implementation 6. Additional Consideration This plan is aimed at individual products and product lines, however, it can be adapted fairly easily for use in planning one or more strategic business units (SBU). The page length suggested for each section represents a single-spaced typed format for a plan focused on a single product. Obviously for multiproduct plans lengths will be somewhat longer. It is assumed that anyone developing a Marketing Plan possesses a working understanding of marketing principles. If you do not, it is suggested you spend considerable time learning about basic marketing through the previous sections of the Principles of Marketing Tutorials. Note, throughout the plan the word "product" is used. However, the information presented in the Marketing Plan tutorials applies to both products and services.