Overall, the mix is exciting. We live in an age of growth, change, and business revolution. The Internet offers us opportunities and threats. We need to make our dealing with it one of our biggest strengths, to minimize our weaknesses.

2. Dominance of communications technologies from a users' point of view. We have an excellent web site, secure File Transfer Protocol (FTP) facilities with password protection for sending and receiving documents from clients, major bandwidth, and an automatic link to training allies to help clients come up to speed with the facilities we offer.  We can even hold Internet meetings with shared interface and visuals.

3. Manageable size. We don't have to support a large overhead, and our clients know that we deliver what we promise ourselves. Our competition, the larger consulting houses, tend to build on the structure of the major partners doing the selling and younger associates, with far less experience, actually delivering the consulting.

4. Contacts. Years of industry experience means a lot of word-of-mouth marketing, contacts, and networking.
 

2. Staff. Without the overhead of staff, we can't leverage on people to develop documents and presentations, research in detail, and fill in the blanks. We are short on support for telephones, fax, and e-mail.

3. Brand. Sometimes a Booz Allen or McKinsey is a safer buy for the executives, in the sense of "nobody ever got fired for hiring IBM." We are a new entity, we can be perceived as an innovative -- and therefore risky -- choice.
 

2. International market growth. Europe and Latin America are booming. Asia has suffered a bit but is recovering. Manufacturers are anxious to take their new technologies across borders.

3. Growing red tape involved with hiring full-time employees, especially internationally, especially at the executive level.
 

2. The larger, branded competition is recognizing our niche. They are beginning to compete in our area, recognize our niche. We are no longer alone.

3. New competitors are developing in new markets. Particularly as the European market grows, competitors developing in that area become more significant.
 

	2.2.1 -    1. True expertise. All of our principals know this area very well. Our experience and expertise is better than anybody we know of in this particular niche area.
	2.2.2 -    1. Marketing. As a group, we are good at the direct sales involved in making a close, but we don't have the resources required to do much general marketing. We will depend on word of mouth first as our main form of generating leads.
	2.2.3 -    1. Internet growth. Companies are being dragged into worldwide marketing, like it or not. Growth rates are very high, opportunities are obvious.
	2.2.4 -    1. The Internet is a threat as well as an opportunity. Our expertise is about crossing borders, managing multiple markets, and the problems we solve are being reduced in importance by the growing availability of information. Specific example: software companies used to charge huge premiums for software available in the different smaller markets, but their potential customers are now much more likely to see available prices elsewhere and buy over the net.

    2.3 -    The key element in purchase decisions made at the Acme client level is trust in the professional reputation and reliability of the consulting firm.
 

The competition comes in several forms:

1. The most significant competition is no consulting at all, companies choosing to do business development, channel development and market research in-house. Their own managers do this on their own, as part of their regular business functions. Our key advantage in competition with in-house development is that managers are already overloaded with responsibilities; they don't have time for additional responsibilities in new market development or new channel development. Also, Acme can approach alliances, vendors, and channels on a confidential basis, gathering information and making initial contacts in ways that the corporate managers can't.

2. The high-level prestige management consulting: XXXXX,XXXXXXXXXXXX,XXXXX-XXXXX, (names omitted to protect confidentiality), etc. These are essentially generalists who take their name-brand management consulting into specialty areas. Their other very important weakness is the management structure that has the partners selling new jobs, and inexperienced associates delivering the work.  We compete against them as experts in our specific fields, and with the guarantee that our clients will have the top-level people doing the actual work.

3. The third general kind of competitor is the international market research company: XXXXXXXXX, XXXXXX, XXXX-XXXXX, (names omitted to protect confidentiality), etc. These companies are formidable competitors for published market research and market forums but cannot provide the kind of high-level consulting that Acme will provide.

4. The fourth kind of competition is the market-specific smaller house. For example: Nomura Research in Japan, Select S.A. de C.V. in Mexico (now affiliated with IDC).

5. Sales representation, brokering, and deal catalysts are an ad-hoc business form that will be defined in detail by the specific nature of each individual case.
      2.4 -    Acme offers expertise in channel distribution, channel development, and market development, sold and packaged in various ways that allow clients to choose their preferred relationship: these include retainer consulting relationships, project-based consulting,  relationship and alliance brokering, sales representation and market representation, project-based market research, published market research, and information forum events.

1. Retainer consulting. We represent a client company as an extension of its business development and market development functions. This begins with complete understanding of the client company's situation, objectives, and constraints. We then represent the client company quietly and confidentially, sifting through new market developments and new opportunities as is appropriate to the client, representing the client in initial talks with possible allies, vendors, and channels.

2. Project consulting. Proposed and billed on a per-project and per-milestone basis, project consulting offers a client company a way to harness our specific qualities and use our expertise to solve specific problems, develop and/or implement plans, and develop specific information.

3. Market research. Group studies available to selected clients at $5,000 per unit. A group study is a packaged and published complete study of a specific market, channel, or topic. Examples might be studies of developing consumer channels in Japan or Mexico, or implications of changing margins in software.
      2.5 -    1. Excellence in fulfilling the promise--completely confidential, reliable, trustworthy expertise and information.

2. Developing visibility to generate new business leads.

3. Leveraging from a single pool of expertise into multiple revenue generation opportunities: retainer consulting, project consulting, market research, and market research published reports.
      2.6 -    The most critical issue is repeat business. We can't build this company on a faulty foundation; we have to have a core group of satisfied clients who come back to us on a regular basis. We can't afford to spent the capital it would take to generate new clients constantly. The repeat business costs about a tenth as much in sales and marketing as the new client.

Repeat business is built on the correct strategic mix of excellence in delivery, clear communication of promise and scope, and follow through.

Most of our competitors build on a structure that has the partners selling the jobs and new hires, bright young people without a lot of experience, delivering. We can't afford to follow that lead. We can use a staff to leverage some of the footwork and analysis work, but ultimately our work must be our own.
      2.7 -    To analyze our historical data, we've made a projection based on what might have been, had the partners been involved in a separate company. It is a composite of the combined consulting of the three main partners.

What we see in the table is that we're taking up a very small portion of the overall consulting dollar spent in this market. There is a lot of room to grow. We have always been profitable, but we expect to do much better than we have after we combine our forces.
      2.8 -    New technology has become the driving force of our market. The Internet is changing high-tech marketing overnight. While the manufacturers used to deal with distributors in smaller national markets, nowadays the distributors are terribly concerned about our pricing and marketing over the Internet.

On one hand, the manufacturers need loyal local allies, good distribution, and value added. On the other hand, they can't pretend to offer protected markets. The Internet changes the game.

Another major factor is the growth expected in Europe and Latin America. While Asian markets are hanging back a bit with the lingering effect of recent economic problems, the Latin American markets are growing smartly as a result of decreasing protectionism, and the European markets are enjoying the new Eurodollar boom.
      3.0 -    Strategy is focus. Our strategy involves focusing on a specific area of expertise in which we are as strong a group as in any company anywhere in the world. We are true experts in the introduction of new technology products, especially through channels of distribution.

Acme will focus on three geographical markets; the United States, Europe, and Latin America, and in limited product segments; personal computers, software, networks, telecommunications, personal organizers, and technology integration products.

The target customer is usually a manager in a larger corporation, and occasionally an owner or president of a medium-sized corporation in a high-growth period.
 

Acme will focus on three geographical markets; the United States, Europe, and Latin America, and in limited product segments; personal computers, software, networks, telecommunications, personal organizers, and technology integration products.

The target customer is usually a manager in a larger corporation, and occasionally an owner or president of a medium-sized corporation in a high-growth period.
 

2. We need brand-name reference clients. By the end of this year, we need three major brand names we can cite as clients. We need to be able to reference by name and contact phone number.

3. We need at least one client in each of three main regions. United States and Europe for sure, and also either Latin America or Asia. We can't be who we claim to be without being truly multi-continental.
 

2. Gross margin higher than 80%.

3. Net income more than 10% of sales by the third year.
 

Our tactics to make this real? First, the quality of work. Second, expertise-based marketing. Third, we rest on heavy use of the newest technologies in international communications (i.e. Internet technologies).

The diagram shows how our marketing programs map into the tactics.
 

In this section, we'll focus on the components of our marketing mix.
 

	3.1 -    Strategy is focus. Our strategy involves focusing on a specific area of expertise in which we are as strong a group as in any company anywhere in the world. We are true experts in the introduction of new technology products, especially through channels of distribution.
	3.2 -    1. We need to establish ourselves as experts. This means being quoted in major trade press, speaking at industry events, and gaining recognition. Our measurable and specific objective is to be introduced in three major events as established experts in the field of international market entry.
	3.3 -    1. Sales of $350,000 in 1995 and $1 million by 1997.
	3.4 -    As indicated by the previous Table 2.1,Target Market Forecast,we must focus on a few thousand well-chosen potential customers in the United States, Europe, and Latin America. These few thousand high-tech manufacturing companies are the key customers for Acme.
	3.5 -    For high-technology companies who are looking to enter new international markets, Acme Consulting offers a unique team of experienced managers with proven expertise, on a temporary contract basis. Unlike in-house expertise, Acme Consulting is a temporary variable cost. Unlike most management consultants, Acme Consulting is specialized on a very focused expertise that is hard to duplicate.
	3.6 -    Our strategy is to focus on our main area of expertise. We have plenty of competition in international marketing and in product introduction expertise, but nobody can match us when we stay focused on introducing a high-tech product into channels in international markets.
	3.7 -    Ours is a delivery-intensive, word-of-mouth, repeat-business business. We aren't marketing as much as selling direct. Obviously we know we need to understand our marketing process -- which is why the attention to quotes in magazines, speaking engagements, etc. -- but we are really selling more than marketing.

We need to fulfill the promise we make: we take a product across national boundaries into new markets, explore channels, guide our client through the maze, and establish the relationships the client needs. This is a very focused deliverable. We aren't just doing international marketing or marketing consulting; we're getting products into channels.

The service itself is a key to our markets.
 

Ultimately, our client will end up spending less on us than on the branded major consultants, because they will wrap the consulting around a lot of additional research and their standard packaging that doubles or triples cost. We'll focus in on the exact target and charge more per day and less for the total job.

We should expect to be much more expensive than the second-tier generalists.
 

1. Getting recognized and quoted as experts. Our public relations expense is intended to positon us as the experts the business press calls on for information on international channel marketing. We need to be quoted in Business Week, Fortune, and the Wall Street Journal, as well as Wired, Red Herring, Upside, and the like. Along the same lines, we need to get the speaking engagements at the major trade shows and events.

2. Word of mouth and reference sites. This goes back to our core value, the importance of fulfilling the promise.

3. The Internet. We need to dominate the Internet, search terms, placement in searchers, etc.
 

1. First, service begins with how we communicate with the client, during and after the consulting job. This is where most of our competitors fall down. Far too often the consultants disappear from the client in what feels like hiding while doing the work. We're going to use the web site in password-protected draft mode so that our clients are always in touch with us. They can log into the web site and see our drafts. We'll give them real service, instead of just sales.
 
2. We also need to give much better service to clients after the job: better accessibility to our work once done. Studies should be available to management; contacts, recommended channels, information that they own and they can use, when they need it, and when they want it.
 

	3.7.1 -    The service itself is a key component to our marketing mix. Our service should be our best advertisement. In this case even more so than with many other similar businesses, because our specialization on channels for international product marketing means we develop contacts with people who can be our recommenders.
	3.7.2 -    We need to make sure that our services are adequately priced. Our positioning, as well as our finances, demands high pricing. When a job is exactly our expertise, we should expect to price high.
	3.7.3 -    For promotion, we follow the mainstream thinking about high-end consulting. There are two main components of promotion:
	3.7.4 -    Service in this topic refers to our client service -- not what we sell as a service company, but the service we deliver as an add-on to the basic service we sell. Confusing? Perhaps, but let's look at client service for a consulting service:

    3.8 -    We need to cover two main elements of market research:

1. Manufacturers. We need to know the market of manufacturers in all three target continents, including market trends and developments related to manufacturers of personal computers, periphrals, connectivity and Internet, and software.

2. Channel marketing. We need to know the trends in channel competition, emergence of new channels, economics, major competitors, new technologies, and major players in all three continents.

At this stage of our development, our research is mainly secondary research generated by keeping up with the media, including trade press and the Internet. We should quickly establish a strong filing system so that we can use the information that appears in secondary sources and catalog and organize for effective use later on.
      4.0 -    Our plan calls for sales of nearly $600,000 this year growing to $1.8 million by 2004, on marketing expenses of slightly more than $200,000, which is about 35% of sales. By the last year in the plan, our marketing expenses of $480,000 will be only 25% of sales.

The plan assumes two important trends:

First, a steady decline in cost of sales and growth in gross margin percentage as we build more of our resources, as full-time personnel and fixed costs instead of contractors and outside consultants. That means that as we grow we take on more risk -- if the plan is implemented. Step by step we'll have to watch the growth of sales relationships that imply the advisability of taking on more people as partners and employees, instead of as contractors.

Second, a decline in marketing expenses as a percent of sales. The 35% figure we project for the first year is quite high, unacceptably high except that we are building a reputation and marketing without the leverage of past marketing, starting from zero. By the fifth year of the plan, we should be spending 25% of sales on marketing. This is a better figure.
 
 

This break-even is a reflection of our first year, in which we are building our fulfillment based on variable cost people instead of fixed-cost people. The risk profile should look very different by the last year.
 

We intend to continue to increase billings throughout the forecast period, reaching annual totals increasing from less than $600,000 in the first year to $1.825 million in the fifth. 

	4.1 -    For consultants, we have an unusually high variable cost of 30% of sales. This makes sense for us at this point, because turning to experts on a per-job basis, as long as these are the people we know and trust, reduces the risk of fixed costs.
	4.2 -    Our sales for this start-up period grow from $10,000 per month at the beginning -- retainer business from our founding partner, with existing clients -- to $90,000 next fall. The sales forecast is aggressive, assuming financing for our marketing expense and bringing on partners and staff as planned.

Later on, we expect the billing to come from additional resources and additional partners, so the billings attributed to the main three go down as a percentage of the total.

The detail for this table is included in the appendices. 

The detail for this table is included in the appendices.

The forecast isn't a reflection of total market directly. It also assumes that we are doing what we have to do to take advantage of the growth potential in Europe. This includes marketing, developing the practice, and developing the repeat business. 

	4.2.1 -    As the projection shows, we expect our billing to come from all three of our main partners first. The partners have relationships that should create these billings at that level.
	4.2.2 -     We expect to focus more on the mainline hardware this first year, but the growth in our industry is in communications and Internet-related business, so during the five years our projection shows a continual trend towards the other segment.
	4.2.3 -    In our regional billings, we expect to see the market in Europe growing much more quickly than in the United States, although the U.S. market starts out much bigger, so that in five years we are billing in equal portions in the United States and Europe.

    4.3 -    Overall we project sales and marketing expenses to more than double from $215,000 this first year to $480,000 in the fifth year. This compares to sales increasing threefold during the same period. We believe that effective marketing requires a very high percentage of sales and marketing expenses to sales during the early years, and that over time we can bring that percentage down to more acceptable levels. 

Expenses divide over four main categories: advertising, public relations, travel, and web site. A smaller budget is included for Graphics and Printing expenses, and we also have a substantial additional budget for contingencies.  
 

	4.3.1 -    As the table and chart shows -- with more information in the appendices -- most of our expenses are managed by marketing, not by the partners themselves. Each partner has some expense allocation to deal with specific client development programs, marketing of expertise, and related projects.
	4.3.2 -    As with partners in the preceding topics, most of our expenses go towards general marketing expenses instead of tailored to a specific segment. This is particularly important for our development of the industry reputation we need even as the product structures and divisions change. We expect billings to shift towards communications, but with expenses we need to market our expertise and let the projects come in their appropriate segments.
	4.3.3 -    Although we don't see our expenses tagged a great deal to specific regions, the projection does call for an increasing level of expenses directed at the European market. The main bulk of expenses, however, goes to the "other" category that includes marketing programs directed at the general marketing of our specific expertise among high-tech companies worldwide.

    5.0 -    This plan is about implementation, changing the business, and making it better. It is worth nothing if not implemented. In this chapter we look at specific implementation programs, and the details that it takes to make it happen.
      5.1 -    The following table and chart identity the key marketing programs, with their managers. Dates and budgets are clearly established. The managers are informed of their main programs and they are on board with implementation.

We will be tracking plan-vs.-actual results for each of these programs and discussing them at our monthly marketing meetings.

The programs will be revised each year. This year's plan includes only the programs to be implemented this year.
      5.2 -    Our marketing department is managed by Leslie Howard, a full-time professional, responsible to all of the partners as a group but to no specific partner. We need the marketing department to maintain its professional integrity above and beyond the specific partners, looking out for our marketing goals and implementing the marketing programs as best fits our strategy.

Leslie has two full-time employees, one in charge of the web site implementation (Tracy) and the other a staff manager to help with the logistics of getting it all done (Kelly).
      5.3 -    The most likely change in the marketing scheme is a major increase in Internet web site traffic and the importance of web site marketing. We will all keep a close eye on web site developments and, if needed, increase our focus on web site marketing.

As of this writing, we expect we can develop our niche and focus without direct competition from the name brand consulting companies. If we attract direct competition operating within our key area, we should then...(omitted for reasons of confidentiality).  

 

   **Source: Marketing Plan Pro from Palo Alto Software - For further information visit their website Http://www.paloalto.com/ or http://www.bhttp://www.bplans.com/plans.com/