IB Business Management HLTopic 4 — MarketingPaper 1 & 2Core idea~10 min read
Putting a Marketing Plan Together
A marketing plan is the business writing down, in advance, who it is selling to and how. Without one you get expensive guessing. The plan has four parts, and three tools that make it work: segmentation, mapping and positioning.
📘 What you need to know
Marketing planning is the process of setting marketing strategies and tactics that meet the business’s marketing objectives.
A marketing plan has four parts: objectives, resources, research and the marketing mix.
Objectives should be SMART: specific, measurable, achievable, relevant, time-bound.
Market segmentation splits one big market into smaller groups of similar customers.
The three main ways to segment are demographic, geographic and psychographic.
A target market is the segment or segments the business aims at.
Market mapping plots products against two criteria to show where a business sits next to its rivals, and where the gaps are.
What goes into a marketing plan
Think of it as answering four questions in order: what are we trying to achieve, what have we got to do it with, what do we know about the market, and what will we actually do?
The marketing mix is the only part customers ever see. The other three decide whether it will work before any money is spent.
1. Marketing objectives
These are the targets. They should be SMART, which mostly means putting a number and a deadline on them. “Sell more” is useless. “Raise market share from 14% to 18% by December” can be checked.
Common marketing objectives include increasing market share, raising sales revenue in one region, hitting distribution targets, and improving brand awareness.
2. Resources
Every objective costs something: an advertising budget, staff time, expertise, sometimes new equipment. A plan that ignores resources is a wish list. If the money is not there, the objective has to change.
3. Research
Research is what stops the plan from being one manager’s opinion. It tells you the size of the market, how fast it is growing, which segments exist, where rivals sit, and how customer tastes are shifting.
4. The marketing mix
This is the doing part — price, promotion, place, product, and for services also people, process and physical evidence. It sets out what will happen, when, and who is responsible.
A plan is only as good as its weakest part. In case studies, look for the mismatch: ambitious objectives with a tiny budget, or a lovely marketing mix aimed at a segment the research says is shrinking. That mismatch is your evaluation.
Market segmentation
No market is one lump of identical people. Segmentation breaks it into groups who behave in similar ways, so the business can talk to each group properly instead of shouting at everyone at once.
Demographic data is the easiest to collect, which is why it gets overused. Psychographic segments are harder to measure but usually explain buying behaviour far better.
Take crisps. It looks like one market, but it is really several: premium sharing bags for adults at dinner parties, baked low-fat versions for health-conscious buyers, and cheap multipacks for family lunchboxes. Same shelf, three different customers, three different marketing mixes.
Why segmentation helps
Where it goes wrong
Accepts that customers are not identical, so products can be tailored to real differences
People inside one segment still behave differently, so the group is never as neat as the plan assumes
Marketing spend is aimed at people likely to buy, so less money is wasted
Segments are hard to define, and one customer can belong to several at once
Customers feel understood, which builds loyalty and repeat purchases
Identifying segments properly needs detailed research, which costs money
Gaps in the market become visible, which can lead to new products
A segment may turn out to be too small to make a profit from
Positioning and market mapping
Market positioning is deciding how you want customers to see your product next to everyone else’s: cheap and cheerful, or expensive and special?
A market map (sometimes called a perception map) puts that on paper. You choose two criteria — price and quality, age and income, whatever fits — draw them as two axes, and plot every product on it.
Bean Hut is the danger to everyone: high quality at a low price. The empty top-left corner would be crowded if it were easy to make money there.
The trap examiners set: a gap on the map looks like a free opportunity. Ask why it is empty. Sometimes there is a niche waiting; sometimes, as in the high price and low quality corner, there is simply no customer.
Market mapping is useful because
But it is limited because
Gaps in the market become obvious, which can spark new product ideas
A gap may exist simply because filling it would not be profitable
You can see exactly how your product compares with rivals
Only two criteria fit on one map, which is a very simple view of a market
It is quick, cheap and easy to draw and explain to others
Plotting it properly may need primary research, which is not cheap
It makes positioning decisions visual instead of vague
It is a snapshot, and markets move on quickly
Worked examples
WORKED EXAMPLE 1
A gym advertises cheap off-peak memberships to students living within two kilometres of the campus, and posts only on the social platforms students use. Identify two ways it has segmented the market. [4 marks]
Step 1: Look for the customer’s characteristics
Students means a narrow age group, so this is demographic segmentation (age, and low income).
Step 2: Look for location clues
“Within two kilometres of the campus” is about where people live, so this is geographic.
Demographic and geographicThe social media detail hints at psychographic segmentation too, but the two clearest bases earn the marks. Always quote the words from the case.
WORKED EXAMPLE 2
Using the market map above, recommend a position for a new coffee shop opening in the town. [6 marks]
Step 1: Read the crowded areas
The low price half already has Cup Stop and Daily Grind, so a price war would start straight away.
Step 2: Read the empty areas
High price with low quality is empty, but that is because no customer wants it.
Step 3: Find the realistic space
There is room in the high quality half, between Corner Cafe and Brew Co, if the coffee is genuinely better.
Position as mid-to-high price, high qualityThen evaluate: this only works if the new shop can prove the quality, since Bean Hut already offers high quality more cheaply.
💡 Exam tip
If asked to draw a market map, label both axes with the criteria and both ends (high and low). Unlabelled axes score nothing.
Name the segmentation type and quote the evidence from the case that proves it.
When you spot a gap, always ask whether anyone actually wants what would go there.
Link segmentation back to the marketing mix: a different segment means a different price, place and promotion.
SMART objectives need a number and a date. Add them yourself if the case only gives a vague aim.
For evaluation, weigh the cost of research against the waste it prevents.
⚠ Common mix-up
Segmentation is not targeting. Segmentation splits the market up; targeting chooses which piece to chase.
Positioning is not location. It is the place the product holds in the customer’s mind, not on a street.
Psychographic vs demographic. Income is demographic. Attitude to spending money is psychographic.
A market map is not a sales chart. It shows perception, not performance.
Marketing plan vs marketing mix. The mix is one of the four parts of the plan, not the whole thing.
Assuming every gap is a niche. Some gaps are empty for very good reasons.
Up next: Standing Out From Competitors — unique selling points, differentiation, and why some of them last while others are copied within a month.
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