Orchestrating a strategic marketing plan.

Composing a successful plan requires a keen understanding of marketing and skill in arranging all the components.

HIGHLIGHTS

* THE CHIEF STAFF EXECUTIVE must take ultimate responsibility for the marketing plan, perhaps even playing the role of conductor.

* TO BE SUCCESSFUL, the marketing plan should drive the association's annual budget process, not be created months after budgeting is complete.

* MARKET RESEARCH, to be truly effective, must be conducted on a continual basis, and the results must be used regularly to update the marketing plan.

Big sigh of relief. Today your association's first marketing director begins work; you'll finally have the strategic marketing plan your board has been pushing for--in fact, you're sure you'll be able to present it at their next meeting in two weeks. You're somewhat in the dark about marketing, but that's okay. After a day of getting settled, your new staff person can dig in and do the job you hired her to do, while you go about your usual meeting preparations.

Hold that breath. You and your marketing director may be in for a rude awakening unless you invest more time in this plan. Despite the experience of a staff expert, the chief staff executive needs to have a keen understanding of the importance of and be involved in developing any comprehensive marketing plan so that he or she can provide meaningful direction and later evaluate the plan.

Underlying principles

Before overseeing the creation of a marketing plan--or, if you don't have staff, developing the plan yourself--you need a grasp of a few key concepts.

Insights into strategic marketing plans. Strategic actions in this context refer to devising and employing plans for achieving a goal. Plans, of course, are the actual programs or methods worked out beforehand to accomplish objectives. Marketing refers to the commercial functions involved in transferring goods from producer to consumer.

Strategic marketing can be compared to a symphony. The key marketing staff person operates much like a conductor, providing direction for timing, emphasis, interpretation, and coordination. Each set of musicians may be likened to departments. The marketing plan is the music written by the group for its members and customers.

Putting it all together, a strategic marketing plan is a program of action for reaching members, prospective members, and customers (nonmembers who don't qualify for membership). The plan addresses association operations, such as membership, meetings, exhibits, education, and publications--all operations, whether they entail products or services or simply communicate a message.

Relationship to budget. The budget is an association's ultimate plan; it's the association's overall strategic plan represented in financial terms. Accounting for all sources of revenue and expenses, the budget is the clearest indication of how and where the association puts resources.

If the budget is the single most important plan an association has, then the marketing plan is a close second. It prompts the association to rely on market research to develop a database for information, providing enhanced tools for decision making. Properly used, the marketing plan means an end to the old-fashioned incremental decision making that frequently plagues an association budget process. Instead of merely saying, "Gee, despite our efforts to balance the budget, we have to cut the budget across the board by 7.5 percent," you can make sound business decisions based on a plan, looking at revenue with as much certainty as expenses.

The marketing plan drives much of the budget process. With the plan, an association states operating assumptions, such as trends in membership and conference attendees, and ties them to the budget. The antithesis of a marketing plan is a system that merely counts up all the known expenses, adds a percentage factor to cover the unanticipated, and arrives at a revenue figure to cover the known expenses. In other words, budgets that take into account marketing plans focus on revenues and revenue potential. Budgets that are developed in a vacuum place their emphasis on expenses, focusing more on the past rather than the future.

Key components

A strategic marketing plan can be as short as 10 pages or as long as 100, depending on the size and complexity of the association and the amount of available data. Whatever the plan's length, it's important to include each of these elements:

* introduction;

* business summary;

* research;

* marketing strategies and projections; and

* monitoring and evaluation techniques.

Introduction. In this section, state overall marketing goals and discuss how the plan ties into the association's mission statement or general strategic plan. Because the plan will contain a lot of confidential and proprietary information, provide a statement of confidentiality and nondisclosure.

One chief staff executive, after handing out a marketing plan to her board, was surprised by that group's reaction. Instead of praise, the directors expressed discomfort. Many members were uncomfortable with all the "sensitive" information contained in the report. They reviewed it quickly and insisted that all copies be returned to the chief staff executive before the meeting ended. In fact, they wanted most copies destroyed. The few remaining copies were marked "secret" and "classified."

This type of situation can be avoided by providing the board early on with some form of participation. You may have a strategic planning committee work with the chief staff executive and marketing staff person. This can help prevent any unpleasant surprises and, at the same time, earn the board's understanding and support.

Business summary. Here's where you describe the marketing environment in which your association operates. Items to list include the overall business outlook, as judged by inflation, interest rates, public confidence in the economy, and more specific indicators that pertain to your association.

Be sure to recognize the general business climate of the nation, then compare it to that of the industry or profession your association represents. Then state any particular aspects of your association affected by the business climate. Is membership up or down? What about publication sales? Did you lose an important staff person, and might it take time to complete a search and bring a new staff person up to speed? In the business summary, it's also important to list competitors and business partners.

Then describe the members, non-members, or customers you are trying to target and the rationale behind those decisions. The rationale generally takes the form of a judgment call by the chief staff executive or marketing professional, in concert with board or committee input. Some years you will want to target different groups. For example, this year you may want to devote more resources toward an emerging membership class--international members, for instance. You may target each membership segment with a unique strategy and message, making some offerings available only to targeted members such as chapter leaders or new members.

The bottom line is that, in today's marketing environment, one message to all members is not effective. The more you can identify sub-groups of members within groups, the more effective you will he in customizing your association's appeal to specific classes of members and customers, thus leading to more effective marketing of your products and services.

In writing your business summary, list the various membership categories and lay out product offerings and services for each. Mention new products and services you plan to offer and any you plan to discontinue.

Describe your product mix--otherwise known as "the four Ps" of marketing:

* products (and services);

* promotion--how the products and services are promoted and sold;

* place (distribution)--how the products and services find their way to members and customers; and

* price.

Also describe your market position and sales revenue. Market position recognizes that in some areas you may have no real competition and, therefore, are dominant. In other areas, you may find your association in heavy competition and viewed as a secondary source.

Understanding market share or position helps the marketing team focus on its strengths and weaknesses. If you know that your association has a market penetration of only 20 percent of members in a given membership category, you may want to develop strategies to bring that number higher through more aggressive recruitment programs and membership offerings.

Research. This constitutes one of the most critical aspects of a sound marketing plan. In this section you cover the characteristics of the overall markets, or segments, in which you compete. What does your competition charge for its products and services? How many of your members belong to other organizations or purchase the services of others? What else do you know about your members?

All too often associations spend an inordinate amount of time surveying members to determine how well the association's products and services are received. This certainly is important information, but it is even more important to ascertain your membership's preferences and needs with respect to the products and services. For example, what publications do they read? How often? What industry meetings do they attend? What do they want and need that you're not offering?

Marketing research, to be truly effective, must be conducted continually, and the results must be used regularly to update the marketing plan. The fluid nature of the plan, which stems from continual research, ensures its viability.

Here's an example to illustrate this concept: Despite the fact that a trade association conducted no aggressive membership promotions, it still received more than a dozen calls a week asking for membership information. But few, if any, of the callers ever joined. Senior management was convinced that nothing was wrong with the association's line of programs and services. The general attitude was that if these smaller companies couldn't see the value in a basic $750 membership, then they didn't deserve to be a member.

Finally, the marketing director asked the staff person in charge of filling membership information requests to call many of the prospects and ask why they didn't join. Most of the respondents said they thought the dues were too high. The staff person asked each of these respondents what he or she would be willing to pay, and many of the answers were in the same ballpark. The association considered the answers and decided to lower the entry-level dues to $500.

The simple and inexpensive research effort paid off. Once the association tuned into the customer perceptions so critical to any marketing plan, membership quickly grew.

The more you know about your members, nonmembers, and customers, the more effective decision-making tools you will have to develop strategies.

Marketing strategies and projections. This section of the plan lists the product and service line, including each offering's strengths and weaknesses. At this point, outline objectives and strategies for each component of the product mix (product, promotion, distribution, and price).

Strategic decisions that require additional resources for developing new or improved products and services must be linked to an association's mission statement and strategic plan. Some chief staff executives have developed excellent strategic plans with board and staff input. Usually such plans are not time-specific; they generally reflect a vision for the association, rather than what it hopes to accomplish in the near term.

Ideally, the strategic planning process creates the overall plan that provides direction for developing an ongoing marketing plan. Marketing plans by comparison are time-specific and have measurable results.

While generally focusing on the bottom line, marketing plans must sometimes allow for some products and services to be offered at a loss. A strategy may require offering products and services that accomplish the goals of the association, fill an important need, and yet will never be able to "make a profit." Here we are dealing with intangible benefits, which may be necessary to recruit or retain members. Of course, if you have too many intangible benefits that lose money, you may need to develop strategies for turning losses into gains.

In the marketing strategies and projections section of the marketing plan, also present the marketing budget, noting how marketing dollars will be spent and what is expected in return. Most associations find the promotion budget the most challenging. How much do you plan on spending for membership recruitment, and what are the anticipated results? How much will you spend on direct mail, advertising, public service announcements, telemarketing, direct mail, and other related activities? Listing previous results by each product and service will help in building more effective plans for the future.

Monitoring and evaluation techniques. Generate progress reports on the marketing plan on a monthly or quarterly basis. The frequency depends on the size, complexity, and scope of the association.

A marketing plan can be modified at any time; it is not a static document. So, for example, if meeting attendance appears to be down compared to prior years, you may want to try new marketing techniques (if there is time) or adjust your revenue projections and scale down costs. If you envision a longer-term trend versus an isolated situation, you may want to adjust price. Some associations can raise their registration fees without too much political fallout, while others have actually increased attendance by lowering fees or by offering huge discounts on multiple registrants from the same organization. Still others have found that offering low-cost alternative lodging helps boost attendance.

Marketing budgets usually must be modified throughout a fiscal year. Numbers must be changed to reflect outcomes related to the success or failure of certain strategies. When this is accomplished, confusion can arise as to the association's overall budget: Should this be changed, too? The answer is no. To reflect important changes in the strategic marketing plan during the year, be sure to add "notes to the budget."

Notes to the budget may take the form of a small number next to a budget line item with a corresponding note at the end of the budget document. This way historical data are preserved while staff and board members are alerted to changes.

While changes are made to the strategic marketing plan, there must be a point at which it is presented as a new model. Usually the best time to unveil such a plan is well before the budget process begins.

Monitoring and measuring results are critical to the strategic marketing plan. A good plan will present many opportunities to evaluate results. For example, expected revenues from specific programs and services should be broken out into fiscal quarters. Any product or service that falls short of projections should be evaluated. Were the strategies to blame? Did some unintended event cause a shortfall (for example, a canceled meeting due to weather)?

Marketing by department

What about smaller departmental plans? For larger associations, or ones with separate subsidiaries, it makes sense to have each product- or service-driven department be responsible for creating its own departmental marketing plans.

You might have a separate plan for a large convention or for a publications department. Any plans that segment information should be part of a larger marketing information system. Membership should be able to draw information about meetings, meetings should be able to coordinate with publications, and so forth. A centralized database with information about members and customers helps pinpoint purchasing trends and is an invaluable asset for planning.

Departmental marketing plans contain all of the elements of the associationwide plan and are rooted in the overall strategic plan. The best method for generating departmental plans is to give each program and service department general guidelines for substance and format. Each departmental plan is incorporated into a master plan; goals and objectives are coordinated among departments until the chief staff executive is satisfied.

In today's fast-moving world of business, the trial-and-error methods of the past won't work. Associations need to adopt better management tools, and developing a ongoing marketing planning system is one of the most critical to association management. Without such plans and systems, decisions are based on past information, and assumptions are groundless and highly subjective. With well-orchestrated plans, associations can count on noteworthy results.

Words of Caution

Marketing plans frequently fail under the following conditions.

1. The plan lists only goals, not strategies. Such plans often fail to ground assumptions with factual research.

2. The plan lacks support at the top. Adequate resources have not been allocated to make the plan work. Perhaps the person in charge of the planning process has not been given enough authority to move ahead, lacks support staff, or lacks computer expertise.

3. The plan is out of sync with the budget cycle. If the plan is completed after the budget has been approved, it will be of little use to association managers.

4. The plan disenfranchises staff. Even if the marketing planning process is a centralized effort, it is crucial to have the input and support of staff from every department. Being centralized should not mean setting up a self-contained bureaucracy. A sound centralized function is open and embraces coordination and facilitation. Every staff member has some responsibility for marketing--regardless of the association size.

5. Assumptions are flawed. A good marketing plan must be more than a wish list or goal statement. Successful plans contain information about how you came to your conclusions. Don't accept financial data without supporting information as to how and on what basis assumptions were drawn. Find out what you can assume for the next 12 months regarding what membership or conference attendance will look like and why.

6. Market research is poor. Don't try to get by without doing the real work of market research. Don't have the mistaken belief that it will be too costly or take up too much time. Unless an association is willing to commit to ongoing market research, it is better off not having a marketing plan at all. Remember the old saying, no research is better than bad research.

7. The plan is not comprehensive. If a plan is developed for a one-time event or opportunity, the plan may do more harm than good. The plan must be integrated with all activities of the association.

8. No one is really in charge. Someone must be charged with responsibility for marketing planning and be given the necessary resources. Another old saying to keep in mind: If everyone is in charge, no one is in charge.

Resources

These resources are available from ASAE's Association Management Press: phone [phone]; fax [phone]; text telephone for people with hearing impairments [phone].

* Market-Driven Management: Lessons Learned From 20 Successful Associations, by Donald M. Norris (ASAE Foundation, 1990; members: $18.95, nonmembers: $45)

* Marketing the Nonprofit Association, edited by Stephen Carey, CAE (GWSAE Foundation, 1992; members: $62, nonmembers: $74)

Alan R. Shark, CAE, is president and chief executive officer of the American Mobile Telecommunications Association, Washington, D.C.