The Keys to an Effective Marketing Plan for a Farmers" Market
A good marketing plan can be the foundation of success for a farmers' market, but only if the plan is well thought-out and based on solid planning and sales concepts.
You also want to make sure the plan you create is easy to use, understand and measure. We discussed the value of a marketing plan for farmers' markets, and the basics of such plans in another segment of this series on marketing of farmers' markets.
Marketing will take your vision for your market and translate it into written goals. Those goals will help you convey your vision to stakeholders (vendors, boards, and patrons) and gather their input. Having a clear vision and marketing plan will also give market vendors and coordinators a unified direction which will help them act consistently with achieving those goals. When everyone is on the same team and moving toward the same goal, it will be much easier to attain success.
Concepts of Planning
Planning begins with a vision, which means planning starts with you. Gather information and input before beginning your marketing plan and seek feedback throughout the process. However, as the visionary of your farmers' market, the final plan will be your creation.
Planning is an ongoing and dynamic process. Begin by considering a specific timeframe. In the case of farmers' markets, think about planning for a market year (May-October) or by season (spring, summer, fall). You will need to monitor your plan's progress weekly and be willing to adjust or revise the plan. As you move through the season, you will learn new things and you will have feedback that you can use to revise your plan.
Because your marketing plan is continually undergoing revision, the most practical plans are "top-down" plans. Some markets utilize "bottom-up" planning or "consensus planning," and there are appropriate places for those processes in your farmers' market. However, since your marketing plan will need to be measured and adjusted weekly, top-down planning techniques will be the most efficient.
If your farmers' market utilizes bottom-up planning and finds that model effective, there are ways in which you can employ that method effectively in your marketing plan. First you must determine who will work on the marketing plan. If the number of people serving on your board is greater than seven, it is best to establish a marketing subcommittee with 5-7 board members. Boards of this size are most effective and efficient.
Once a marketing committee has been established, there are two basic options. Either the market manager can devise the plan and seek input or the board can be the starting point. Board members can suggest ideas and strategies to give direction to the manager who will devise the plan. Although the board will approve the marketing plan, it is important for the market manager or a designated individual working in conjunction with the manager to be able to adjust the plan through the season without needing to return to the board. Without the authority to make adjustments to the plan as new information arises, it will be difficult to achieve the desired outcomes.
The steps of the planning process may include:
Planning Process
It is important to create your plan before the market season begins. That will give you time to communicate the plan to your employees, vendors, and other market supporters. If you would like to include any special products, be sure to ask your growers well in advance. If growers need to grow something out of the ordinary or in increased quantities, it is best to inform them before they purchase their seed for the next year, which can happen as early as December.
A planning calendar is an essential tool for the marketing plan. It helps to ensure that those working with you can carry out the marketing plan and provide data and input within communicated deadlines. Completing the plan on time and in advance of the market season is essential, especially to those affected by the plan.
The intent of the planning calendar is to organize related activities.This is not a complex task, but it is important to set deadlines.
Sales Concepts
Each market has its own mission statement, niche, and goals. However, the common denominator to all farmers' markets is commerce. Farmers, bakers, and other vendors come to your market to strengthen their individual businesses, so you must make your market profitable for vendors.
Sales are the central focus of the plan, since the goal of a marketing plan is to increase sales. Therefore, the plan should include actions that will boost sales. Monitor your plan regularly to determine whether those actions are resulting in sales.
Sales are measured in two different ways. The first and most traditional is by dollar amounts. Another way of measuring sales is by units. What is the value of measuring unit sales? Unit sales will help determine the appropriate price for a unit of potatoes (pound, bag, or bushel) or beets, or if the price charged may have been too low. Also, as you look at selling related products, you can see the impact of multiple sales. For instance, if you sold two pounds of tomatoes at regular price and one head of lettuce at half price, the sales increase would be more obvious if you viewed unit sales rather than dollar amounts.
Additional terms to know are rate of sales, percentage change to goal, and percentage change to last year. When you look at marketing plans, you are always measuring success by the change to your baseline sales numbers. For most organizations, that is the previous year. When comparing your plan, you need to look at rate of sale or the change from year to year. The rate is measured in units, dollars, and percentages. The most obvious use of rates of change is percentages.
Sales Strategy Terms
Sales strategies are integrated. Vendors perform for your market individually and yet can be made to perform more effectively by integrating their sales plans. Marketing plans that you develop will almost always be integrated.
Here are the key concepts for integrated sales planning:
Optimal sales and product mix - The mix of vendor sales and/or products at your market that produce the largest revenue in dollars and the highest return on your expense investment. The goal is not to have as many vendors as possible or the largest variety of vendors; it is to have the right number and mix to maximize the return on investment.
Return on investment -- All marketing plans are limited by available resources. Investment is normally calculated using the dollars you will spend for actions such as website development, media advertising and printing costs. Other costs include your time, space used by certain vendors included in your plan-o-gram, and space on web pages.
Return on investment is calculated by dividing the total sales by the total investment. The calculation should result in a return of more than one and ideally it should be larger than two.
Optimal marketing mix -- This is one of the most important elements of your marketing plan.You need to work with each vendor to determine their products and their prices.
Not all vendors have the same fixed costs. Some vendors may own their land and equipment or be able to buy their materials in larger quantities than others. Although they may be able to sell their product at a lower price, that isn't necessarily the best thing for your market, your customers, or your vendors. By underselling their products, these vendors often prevent smaller or less established farmers from being profitable. The numbers of vendors who can survive at these prices are limited and by allowing them to undermine prices, you are limiting the numbers and types of vendors that can be profitable. Underselling can also pose a problem for hobby and part-time growers who are not dependent on their income at the market. Sales planning by vendors is critical to ensure that all vendors have the opportunity to succeed. Your overall sales plan must ensure the long-term sustainability of your market by preventing underselling.
Plan Development
The correct way to develop a marketing plan is through a unit planning model. This involves the use of "waterfall plans." You look at what inventory is required to produce sales per week at a stated price per unit.The difficult part of the process is determining the revenue per unit. The choice of this price is based on market conditions, time of the year, and competition.
Competition is retail competition, not wholesalers or distributor prices. This is the most common mistake made by vendors. Products at the farmers' market are high quality and very fresh.You should compare your prices with that of a similar product. Whole Foods, Trader Joe's, and local, higher-end grocery stores are your reference point, not the sale price of the local discount store.
The process should be continuous, with a plan that changes as you receive additional information. Begin with a basic plan. Take the number of units by product and place a reasonable average of prices on each product. This will enable you to develop unit sales by week and then each month. Once you have a calendar of total sales by week for the farmers' market, you can then set the basic plan for review.
The second step is your integrated sales plan. This plan should include pricing models for add-on selling, multiple selling, and selling with another vendor's product or co-branding. For each technique in the marketing and sales plan, you will look at selling by manipulating the price in order to increase units, such as 2-for-1 selling or a discount on the second item. Multiple selling is the process of selling one unit by offering another unit at a reduced price.
Once the basic plan and the integrated sales plan are finished, you can start rolling out the plan for each vendor and finalizing the plan for each vendor. For larger markets, or if you're just getting started, you may wish to ask for volunteers to participate in this process. Once the more reluctant vendors observe their success with planning, they may be more open to working with you to become part of the overall market plan. Some vendor plans will be simple while others will require integrated plans. As the market manager, you must decide which strategies work best for the overall goal. Work with your vendors to adopt these plans.
Once you complete the vendor plans and combine them into an integrated plan, you can now review the overall sales plan. If the plan meets your basic assumptions, as we will describe in more detail in our book, which includes a sample sales plan, your plan is complete and you can communicate it to the staff and the vendors. The final step is to commit your marketing plan to a timeline with action steps for execution. The plan is an action-oriented, integrated approach to ensuring your action steps are completed in advance of generating weekly and monthly sales.
You also want to make sure the plan you create is easy to use, understand and measure. We discussed the value of a marketing plan for farmers' markets, and the basics of such plans in another segment of this series on marketing of farmers' markets.
Marketing will take your vision for your market and translate it into written goals. Those goals will help you convey your vision to stakeholders (vendors, boards, and patrons) and gather their input. Having a clear vision and marketing plan will also give market vendors and coordinators a unified direction which will help them act consistently with achieving those goals. When everyone is on the same team and moving toward the same goal, it will be much easier to attain success.
Concepts of Planning
Planning begins with a vision, which means planning starts with you. Gather information and input before beginning your marketing plan and seek feedback throughout the process. However, as the visionary of your farmers' market, the final plan will be your creation.
Planning is an ongoing and dynamic process. Begin by considering a specific timeframe. In the case of farmers' markets, think about planning for a market year (May-October) or by season (spring, summer, fall). You will need to monitor your plan's progress weekly and be willing to adjust or revise the plan. As you move through the season, you will learn new things and you will have feedback that you can use to revise your plan.
Because your marketing plan is continually undergoing revision, the most practical plans are "top-down" plans. Some markets utilize "bottom-up" planning or "consensus planning," and there are appropriate places for those processes in your farmers' market. However, since your marketing plan will need to be measured and adjusted weekly, top-down planning techniques will be the most efficient.
If your farmers' market utilizes bottom-up planning and finds that model effective, there are ways in which you can employ that method effectively in your marketing plan. First you must determine who will work on the marketing plan. If the number of people serving on your board is greater than seven, it is best to establish a marketing subcommittee with 5-7 board members. Boards of this size are most effective and efficient.
Once a marketing committee has been established, there are two basic options. Either the market manager can devise the plan and seek input or the board can be the starting point. Board members can suggest ideas and strategies to give direction to the manager who will devise the plan. Although the board will approve the marketing plan, it is important for the market manager or a designated individual working in conjunction with the manager to be able to adjust the plan through the season without needing to return to the board. Without the authority to make adjustments to the plan as new information arises, it will be difficult to achieve the desired outcomes.
The steps of the planning process may include:
- Develop basic assumptions.
- Develop overall sales goals.
- Develop sales goals by vendor.
- Develop measurable sales goals by timeline.
- Develop "revenue drivers" which facilitate variable budgets.
- Develop appropriate expense goals.
- Develop appropriate capital investment goals.
- Review the plan with key vendors to check validity of the assumptions.
- Revise plan for information provided.
- Issue the plan and communicate to all interested stakeholders.
- Monitor actual results and prepare variance reports (the difference between the actual performance and the forecasted performance).
Planning Process
It is important to create your plan before the market season begins. That will give you time to communicate the plan to your employees, vendors, and other market supporters. If you would like to include any special products, be sure to ask your growers well in advance. If growers need to grow something out of the ordinary or in increased quantities, it is best to inform them before they purchase their seed for the next year, which can happen as early as December.
A planning calendar is an essential tool for the marketing plan. It helps to ensure that those working with you can carry out the marketing plan and provide data and input within communicated deadlines. Completing the plan on time and in advance of the market season is essential, especially to those affected by the plan.
The intent of the planning calendar is to organize related activities.This is not a complex task, but it is important to set deadlines.
Sales Concepts
Each market has its own mission statement, niche, and goals. However, the common denominator to all farmers' markets is commerce. Farmers, bakers, and other vendors come to your market to strengthen their individual businesses, so you must make your market profitable for vendors.
Sales are the central focus of the plan, since the goal of a marketing plan is to increase sales. Therefore, the plan should include actions that will boost sales. Monitor your plan regularly to determine whether those actions are resulting in sales.
Sales are measured in two different ways. The first and most traditional is by dollar amounts. Another way of measuring sales is by units. What is the value of measuring unit sales? Unit sales will help determine the appropriate price for a unit of potatoes (pound, bag, or bushel) or beets, or if the price charged may have been too low. Also, as you look at selling related products, you can see the impact of multiple sales. For instance, if you sold two pounds of tomatoes at regular price and one head of lettuce at half price, the sales increase would be more obvious if you viewed unit sales rather than dollar amounts.
Additional terms to know are rate of sales, percentage change to goal, and percentage change to last year. When you look at marketing plans, you are always measuring success by the change to your baseline sales numbers. For most organizations, that is the previous year. When comparing your plan, you need to look at rate of sale or the change from year to year. The rate is measured in units, dollars, and percentages. The most obvious use of rates of change is percentages.
Sales Strategy Terms
Sales strategies are integrated. Vendors perform for your market individually and yet can be made to perform more effectively by integrating their sales plans. Marketing plans that you develop will almost always be integrated.
Here are the key concepts for integrated sales planning:
Optimal sales and product mix - The mix of vendor sales and/or products at your market that produce the largest revenue in dollars and the highest return on your expense investment. The goal is not to have as many vendors as possible or the largest variety of vendors; it is to have the right number and mix to maximize the return on investment.
Return on investment -- All marketing plans are limited by available resources. Investment is normally calculated using the dollars you will spend for actions such as website development, media advertising and printing costs. Other costs include your time, space used by certain vendors included in your plan-o-gram, and space on web pages.
Return on investment is calculated by dividing the total sales by the total investment. The calculation should result in a return of more than one and ideally it should be larger than two.
Optimal marketing mix -- This is one of the most important elements of your marketing plan.You need to work with each vendor to determine their products and their prices.
Not all vendors have the same fixed costs. Some vendors may own their land and equipment or be able to buy their materials in larger quantities than others. Although they may be able to sell their product at a lower price, that isn't necessarily the best thing for your market, your customers, or your vendors. By underselling their products, these vendors often prevent smaller or less established farmers from being profitable. The numbers of vendors who can survive at these prices are limited and by allowing them to undermine prices, you are limiting the numbers and types of vendors that can be profitable. Underselling can also pose a problem for hobby and part-time growers who are not dependent on their income at the market. Sales planning by vendors is critical to ensure that all vendors have the opportunity to succeed. Your overall sales plan must ensure the long-term sustainability of your market by preventing underselling.
Plan Development
The correct way to develop a marketing plan is through a unit planning model. This involves the use of "waterfall plans." You look at what inventory is required to produce sales per week at a stated price per unit.The difficult part of the process is determining the revenue per unit. The choice of this price is based on market conditions, time of the year, and competition.
Competition is retail competition, not wholesalers or distributor prices. This is the most common mistake made by vendors. Products at the farmers' market are high quality and very fresh.You should compare your prices with that of a similar product. Whole Foods, Trader Joe's, and local, higher-end grocery stores are your reference point, not the sale price of the local discount store.
The process should be continuous, with a plan that changes as you receive additional information. Begin with a basic plan. Take the number of units by product and place a reasonable average of prices on each product. This will enable you to develop unit sales by week and then each month. Once you have a calendar of total sales by week for the farmers' market, you can then set the basic plan for review.
The second step is your integrated sales plan. This plan should include pricing models for add-on selling, multiple selling, and selling with another vendor's product or co-branding. For each technique in the marketing and sales plan, you will look at selling by manipulating the price in order to increase units, such as 2-for-1 selling or a discount on the second item. Multiple selling is the process of selling one unit by offering another unit at a reduced price.
Once the basic plan and the integrated sales plan are finished, you can start rolling out the plan for each vendor and finalizing the plan for each vendor. For larger markets, or if you're just getting started, you may wish to ask for volunteers to participate in this process. Once the more reluctant vendors observe their success with planning, they may be more open to working with you to become part of the overall market plan. Some vendor plans will be simple while others will require integrated plans. As the market manager, you must decide which strategies work best for the overall goal. Work with your vendors to adopt these plans.
Once you complete the vendor plans and combine them into an integrated plan, you can now review the overall sales plan. If the plan meets your basic assumptions, as we will describe in more detail in our book, which includes a sample sales plan, your plan is complete and you can communicate it to the staff and the vendors. The final step is to commit your marketing plan to a timeline with action steps for execution. The plan is an action-oriented, integrated approach to ensuring your action steps are completed in advance of generating weekly and monthly sales.
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