What is Marketing?
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Marketing objectives define what you want to accomplish through your marketing activities. There are several important factors to consider when establishing effective marketing objectives.
SMART Approach = Setting specific, measurable, achievable, realistic and time specific objectives
When setting objectives it is very important to ensure that your objectives are; specific, measurable, achievable, realistic and time specific, or SMART for short. The "SMART" approach allows you to effectively manage your marketing activities and importantly be able to determine how successful they have been and whether they have delivered the particular benefits sought.
The "SMART" approach is explained to illustrate how you address each area;
- Specific - are your objectives stated in a way that is precise about what you are hoping to achieve?
- Measurable - Can you quantify each objective, i.e. can you use a unit of measure such as market share in percentage or dollars or other to provide a way to check your level of success?
- Achievable - Are your objectives reasonable in terms of what you can actually achieve or are you setting your sights too high?
- Realistic - Do you have sufficient employees and resources to achieve the objectives you have set, if you don't then they are likely to be unrealistic?
- Time specific - When are you hoping to achieve these objectives, you need to define a timing plan with target timing for each specific objective?
As an example, ABC stationary supplier sells its goods to newsagents across the country and they want to boost revenue for their product range. To detail this objective more clearly, we could define it using the "SMART" approach as follows:
To gain 30% market share for stationary by 2011.
- Specific - need to understand the latest preferences of customers in the identified segments and appropriately target each stationary item such as pens, exercise books, rulers, and calculators to maximise sales volumes
- Measurable - current market share is 20%, will set a target of 30% market share, meaning we need an extra 10%, market share amounts can be established based by monitoring the overall value of sales in terms of dollars
- Achievable - ensuring technical competency and commitment of all personnel involved in the development and implementation of strategy. This can range from having an experienced and knowledgeable marketing team to capable sales staff. Access to funding is also necessary for the acquisition of extra stock to fulfil increased demand.
- Realistic - the objective is realistic as the marketing resources are in place to conduct the segmenting and targeting exercise and access to the extra stock required
- Time Specific - the increase in market share is to be achieved within 12 months, a regular progress update will be taken every month to track level of success
Linking marketing objectives to strategies
Your marketing objectives should also be consistent with and indicate the priorities of the organisation. This means that objectives should flow from the mission statement of your business, towards the financial objectives and to the rest of the marketing plan.
For Example, ABC Garden Centre has as part of its strategic plan a goal to grow the business by diversifying its product range, with the specific financial objective of achieving a 10% growth in overall sales which means an extra $75,000 in revenue.
A linked marketing objective could be to add pre-packaged garden soil as a new complementary product line to be offered with plant sales. To grow the business as per the strategic goal and meet the financial objective of $75,000 in extra sales, it has been calculated that a total of 7,500 bags will need to be sold at their selling price of $10 each.
Provide direction to employees
Clearly defined objectives may also provide direction for your employees in terms of what to achieve and in what period. They also serve as motivators for your employees by creating an attainable challenge that they can to strive achieve.