Marketing Planning

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‘Planning is an unnatural process; it is much more fun to do something.’
Sir John Harvey Jones

As the above quote illustrates planning is often a neglected area. It is however vital for marketing success and this article aims to address this by outlining a proposed approach to marketing planning.

Launching straight into marketing activity creates the initial frenzy and buzz that gives a feeling of positive action, however the results often ultimately disappoint. This approach is also often associated with wasted time and money and a reticence towards future marketing initiatives.

Marketing help wanted

This is particularly relevant where an organization does not have specific marketing experience or resource. Experienced marketing professionals can help bring a different perspective and a focus to an organization’s activities, and ideally should be brought in prior to activity starting.

However this is not always a pragmatic solution. Many businesses that have thrived through a growing market expect marketing to quickly generate additional growth once this position has reversed.

Time is of the essence

This is the situation currently facing many traditional community insurance brokers under pressure from:

The soft market
Banks growing in micro-commercial
Growth of the Internet and dedicated small business brokers
Emergence of aggressive young brokers and super provincials
Nationals moving back to mid-market, adding value and developing multi-specialisms

All this means existing client bases are under threat. And new customers are harder to come by. Reduced premiums, alongside increased costs for compliance, means margins are lower. This makes it difficult to justify extra expenditure on marketing that would be borne for a significant period before the benefits are reaped.

Quick DIY marketing

It may therefore be more practical financially to get some marketing activity going and near critical mass before bringing in dedicated professional support. This approach also gives the opportunity to understand more about the type of marketing support needed.

To help there are a number of organizations that will potentially provide some degree of marketing support:

banks
government agencies e.g. business link
marketing agencies
insurers
networks or alliances

Your own situation will determine whether you have access to these, how relevant they are and to what extent you get support in utilizing them.

Planning vs Doing

Planning is essential to support the correct long-term development of the organisation.

The key to planning is the appreciation that the end plan is not the main driver as this will inevitably change, as another quote illustrates:

‘Plans are nothing; planning is everything’.
Dwight D. Eisenhower

However, planning is a never-ending process. Which means there is a danger that there is always another thing to investigate before activity can start. This can result in a loss of momentum and missed opportunities.

As usual, the answer lies in a balance. What is needed is a planning process that is quick, simple and which identifies some initially appropriate tactical activities. These tactical activities can then refined or replaced over time as the ongoing more detailed planning process identifies a better approach.

Change is essential

Before starting on a marketing plan it is essential to fully appreciate that marketing is entirely about change. It involves understanding what needs to be changed and then making it happen. As the marketing planning process unfolds the amount of change visibly required increases.

If a business has operated for some time without a particular marketing focus there will be more to uncover. Tough decisions then have to be made as to how much upheaval the business can sustain in making these required changes. This will largely depend on the future ownership plans for the business.

A practical planning approach

The marketing planning process is concerned with:

Establishing relevant marketing objectives, allocating resources to meet these and setting out a clear action plan to achieve them
Assessing the position and performance of your business in the markets in which you operate
Evaluating your strengths and weaknesses and looking for opportunities and threats
Setting out ways of evaluating performance against marketing objectives

For many brokers there are typically constraints on marketing in terms of:

Time: for planning and doing, consistently
Skills: for planning and doing
Practical issues: for doing

These need to be factored into the marketing planning process and activity.

This means the plan cannot initially be too complicated or too time consuming. A 5-stage process can be used initially to give a better general idea of the right direction and to ensure activity is focused.

Stage 1: Business objective and target setting

This stage involves agree the overall business objectives and looking at the finances to understand:

Current premium and commission levels.
Current costs
Predicted premium and commission income for the coming year(s). This should consider premium and commission tends and retention rates.

This will highlight the level of business required to achieve the desired levels of income and profitability.

An initial idea of the necessary number of enquiries this can be obtained by considering average premiums and average conversion rates for enquiries to quote and then quotes to policies.

This gives a clear indication of the scale of the task and what resources might be needed to achieve this.

Stage 2: Marketing Audit

Having established this target figure, the next stage is to consider how the business currently approaches marketing and client relationships and what opportunities there are to improve this.

There are 4 main areas to consider:

Existing clients
New clients
Lapsed clients
Company identity

Time spent here is well spent and should involve employees from around the business to understand exactly what happens and what hindrances currently exist.

It should also consider competitors and how they do or could impact on you.

The outcome of this stage should be a much clearer idea of what needs to be addressed and a better direction for tactical activity.

Stage 3: Activity Planning

This stage looks at what you wish to achieve, for example building stronger relationships with key clients, and considers what activities would produce this.

Stage 4: Marketing management

This stage actually pins down all the thinking so far to some actual key activities:

What exactly is the activity
When should it be implemented
Who is responsible
How much will it cost
What other resources or training are needed
What operational changes are required
What processes needed to be established to monitor results
When will the plan be reviewed

Stage 5: Review

This is the stage where results and reviewed and the plan and the tactics are adjusted:

What activities have taken place
What issues occurred
How well has each activity done
What could be done differently
What new activities need to be scheduled in
Does the overall plan need to change

Planning is time well spent

If the planning process is properly undertaken and built on as extra experience and resource is brought to bear, the time spent planning should be well rewarded.

The important thing is having a plan that delivers:

‘However beautiful the strategy, you should occasionally look at the results’
Winston Churchill

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This article was written by Richard Croucher, Head of Marketing, Broker Network
An edited version of this article was published in Insurance Times in 2006