Some say they are useless because circumstances and conditions always change soon after plans are set, while others find their marketing plan indispensable to the overall well-being of the company. The smart move is to always have a plan.

Risk vs. benefit

Perhaps the most logical way to view the topic is in the context of risk vs. benefit: What real danger does a company face because of having a marketing plan—and how does that compare to the risks inherent in not having one? What about concrete benefits of going without a plan—if those even exist, can they compete with the financial and other measurable advantages afforded by having one?

The answers are obvious. If you don’t know where you’re headed, you might end up at an unintended destination. Every business needs a sense of direction; so, you should consider your marketing plan as an essential component of your ultimate success. You may not implement everything, but at least you have a game plan. Let’s take a look at three actual start-up companies and analyze their efforts to launch.

Three case histories

Company A:
In the first year of business, Company A had no marketing plan. They concentrated their efforts on product development, building a team of professionals, and unwisely spending on office enhancements, corporate outings, etc. At the end of the year, the company had a booth at a trade show; and that was the end of their marketing efforts. Six months later, the officers of the corporation decided they needed a marketing plan because sales were not happening. The marketing team put together a comprehensive plan that, when executed, would have positioned the company as a global leader in their respective market. However, the executive team continued to drag their feet and did not release the necessary marketing funds. As a result, two months later, Company A was forced to fire the entirety of their team, as they were running of out of money with a warehouse stacked full of products, no sales, and a group of angry investors. Without a solid marketing plan and funds to back it up, it was a complete failure to launch. Company A has yet to recover, and its future is in serious doubt.

Company B:
Company B also failed to create a marketing plan. Worse yet, they had no funds allocated for marketing or advertising. The owners were under the impression that, merely by securing a good location, obtaining a business license, and turning on the “Open” sign, they had a solid foundation to run a successful business. The store was beautiful, filled with unique products and amazing staff. Unfortunately, that proved not to be enough. Since the business was funded by the owners themselves, they barely broke even in the first year of operation. The second year brought better revenue, but the owners were getting burned out, putting in long hours and, essentially, spinning their wheels. Third year did not show any growth, and the decision was made to sell the business. Incredibly, the new owners repeated the same mistake of not having a solid marketing plan; within two years they, too, were out of business.

Company C:
Like the first two companies, Company C had no marketing plan in the first year of business. Every promotional effort was a shot in the dark—sending every marketing dollar into the wastebasket. Without a cohesive marketing plan, nothing was getting tracked; Company C was treading water and needed to regroup. The marketing team developed a comprehensive plan, and, even though everything wasn’t implemented, in the second year revenue grew by an astonishing 375 percent. Employees were excited at not having to worry about missed payroll, and investors were certainly delighted with the results. It was a win-win all the way around. Company C has continued with yearly revised marketing plans, and their efforts have been paying off with steady increases in revenue.

Roadmap to success

As these examples illustrate, any company—regardless of age or size—that want sustained growth must have a marketing plan and the funds to back it up. Start by establishing a marketing budget of around 10 percent of your existing or projected revenue, and recognize your marketing plan as your roadmap to success. It sets the tone for the entire year, providing a sense of direction and equally important peace of mind.

Whether you’re starting a new business or getting set to take an established company to the next level, a solid marketing plan is a solid must.