What Is Financial Information in Marketing Strategy?

Financial information is critical to the 4Ps: product, price, place, promotion.

A long-standing principle for developing a solid marketing strategy is to incorporate the "4Ps"---product, price, promotion and place. What is important to note is that financial information is integral to each of the 4Ps. This article goes two steps further, adding two additional "Ps" to make your marketing strategy even more carefully thought out: projections and profits, to aim for even greatest success.

Product

Consider adding two more Ps: Projections and Profits.

Look at every aspect involved in developing your product for sale. If it is a tangible product, identify and quantify every cost involved. For example, if the end product is a pair of shoes, identify everything in the manufacturing process, from designing the shoes, to the cost of materials involved to manufacture the shoes. If your product is service-oriented, such as an accounting firm or website design service, determine a price for each hour involved in providing the service. Use this information in the marketing strategy to establish financial goals for sales volume and the number of customers or clients.

Price

After including financial information, review the marketing strategy and revise where needed.

Set a price for the product, now that you know how much your product is costing you. Conduct research to see what other businesses charge. Try to remain within the acceptable or customary range of pricing in your respective product category to keep your business competitive. Incorporate this financial information into your marketing strategy.

Promotion

Promotion and advertising costs are key components of a marketing strategy. A new business will often need to allocate more money for this in order to launch the business and generate awareness among prospective customers and clients. An existing business may continue expenditures without change to sustain sales, or marketplace conditions may require an increase due to competition or to introduce new products or services. Your marketing strategy is the business document to assess and identify this vital financial information.

Place

Assess how much it costs to deliver your product or service to a client or consumer. This can include your monthly lease expenditures for a retail space, to how much it costs to ship merchandise for an online business that sells to customers from Connecticut to California. Evaluate how much you pay for rent and how many sales it takes to cover that expenditure. If you ship products, add up the actual costs for staff, boxes and what the shipping provider charges. The results will provide an opportunity to revisit and revise product pricing, as well as the overall financial information in your marketing strategy.

Projections: The Fifth "P"

Product, price, promotion and place all have an impact on the financial projections of a marketing strategy. For example, a shoe boutique owner would look at all of the corresponding costs and expenditures involved in the business to make sales and revenue projections. A website developer would understand the correlation between setting pricing for services, to advertising and promotions, in order to project annual revenue. Projections enable business owners to strategically monitor and adjust expenditures up or down in order to stay on target with financial goals.

Profit: The Sixth "P"

The financial information and methodologies described are strategic financial tools. It is important to realize that not every business can anticipate or expect to make a profit every year, especially a new business. Conditions change, unpredictable economic influencers occur. Use the four to six "Ps" to continually monitor, assess and adjust the financial information in your marketing strategy to help achieve your goals.

References

• SBA: Marketing Objectives & Strategies
• Small Business Notes: Marketing Plan
• Grow Think: Business Plan
• Community Futures: Business Plan Financial Information