non-profit recording co-op marketing plan

Copyright © Palo Alto Software, Inc. (www.paloalto.com). All rights reserved.

About this marketing planNames, locations, and numbers in the original plan may have been changed, and substantial portions of the original plan text may have been omitted to preserve confidentiality and proprietary information.

Guidelines on using this planYYou are welcome to use this plan as a starting point to create your own, but you do not have permission to reproduce, publish, distribute or even copy this plan as it exists here. Requests for reprints, academic use, and other dissemination of this sample plan should be emailed to the marketing department of Palo Alto Software at [email protected]. For product information visit our website at www.paloalto.com or call 1-800-229-7526.

Learn more at www.paloalto.com

“Simplifies the process of building supportingdocumentation for your marketing agenda.”

“Create an action plan for yourmarketing to grow your business.”

Create a marketing plan that gets results

$179.95Version 11.0

• Focus on action and results!

• Packed with advice and examples

• Easy forecasts & budgets

• Present your plan with style

• Instant download!

Bestselling software. Now powered by Duct Tape Marketing.

This is a complete example of a marketing plan. You are welcome to use this content as a guide when planning your own marketing activities.

To create a marketing plan of your own to grow your business, please consider our popular Marketing Plan Pro software. Learn more at www.paloalto.com.

Non-Profit Recording Co-op Marketing PlanGamehenge Tapers Co-op

Confidentiality Agreement

The undersigned reader acknowledges that the information provided by _________________________ in this marketing plan is confidential; therefore, reader agrees not to disclose it without the express written permission of _________________________.

It is acknowledged by reader that information to be furnished in this marketing plan is in all respects confidential in nature, other than information which is in the public domain through other means and that any disclosure or use of same by reader, may cause serious harm or damage to ________________________.

Upon request, this document is to be immediately returned to _________________________.

___________________ Signature

___________________Name (typed or printed)

___________________Date

This is a marketing plan. It does not imply an offering of securities.

Table Of Contents

1.0 Executive Summary . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 11.1 Company Summary . . . . . . . . . . . . . . . . . . . . . . . . . . . 1

2.0 Situation Analysis . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 12.1 Market Summary . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2

2.1.1 Market Demographics . . . . . . . . . . . . . . . . . . . . . 22.1.2 Market Needs . . . . . . . . . . . . . . . . . . . . . . . . . 22.1.3 Market Trends . . . . . . . . . . . . . . . . . . . . . . . . 32.1.4 Market Growth . . . . . . . . . . . . . . . . . . . . . . . . 3

2.2 SWOT Analysis . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 42.2.1 Strengths . . . . . . . . . . . . . . . . . . . . . . . . . . 42.2.2 Weaknesses . . . . . . . . . . . . . . . . . . . . . . . . . 42.2.3 Opportunities . . . . . . . . . . . . . . . . . . . . . . . . . 52.2.4 Threats . . . . . . . . . . . . . . . . . . . . . . . . . . . . 5

2.3 Alternative Providers . . . . . . . . . . . . . . . . . . . . . . . . . . 52.4 Services Offered . . . . . . . . . . . . . . . . . . . . . . . . . . . . 52.5 Keys to Success . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 52.6 Critical Issues . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 6

3.0 Marketing Strategy . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 63.1 Mission . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 63.2 Marketing Objectives . . . . . . . . . . . . . . . . . . . . . . . . . . 63.3 Financial Objectives . . . . . . . . . . . . . . . . . . . . . . . . . . . 63.4 Target Markets . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 63.5 Positioning . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 73.6 Strategy Pyramid . . . . . . . . . . . . . . . . . . . . . . . . . . . . 73.7 Marketing Mix . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 83.8 Marketing Research . . . . . . . . . . . . . . . . . . . . . . . . . . . 8

4.0 Financials . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 84.1 Break-even Analysis . . . . . . . . . . . . . . . . . . . . . . . . . . . 84.2 Funding Forecast . . . . . . . . . . . . . . . . . . . . . . . . . . . . 94.3 Expense Forecast . . . . . . . . . . . . . . . . . . . . . . . . . . . 10

5.0 Controls . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 125.1 Implementation . . . . . . . . . . . . . . . . . . . . . . . . . . . . 125.2 Marketing Organization . . . . . . . . . . . . . . . . . . . . . . . . . 135.3 Contingency Planning . . . . . . . . . . . . . . . . . . . . . . . . . 13

1.0 Executive Summary

Gamehenge Tapers Co-op is a not-for-profit organization that was created to serve the Boulder, Colorado tapers community. The tapers community is a hobby based community that trades live recordings for personal use, never for commercial gain. The Co-op will provide this community with the equipment needed to further the taping of shows that in effect supports the trading community as well. The Co-op sells the recording equipment at wholesale prices plus a low overhead percentage. Offering members heavily discounted rates encourages them to become more active tapers. Because the organization is a not-for-profit co-op, members are willing to volunteer their time to help the organization allowing it to become successful. The organization exists to support the trading community.

The basic market need is a source of equipment and intellectual capital that supports the taping community. Because of the very nature of the movement being underground (not for legal reasons, but due to general commercial shunning of taping), a local support organization is in high demand. The recent popularity of the CD recorders (creating perfect copies of the original) has also been a factor in tapings recent increase in popularity.

Membership dues and a small charge for overhead will allow the organization to cover costs associated with doing business and allow it to slowly grow over time. Gamehenge Tapers Co-op will be increasing their membership roster by at least 20% per year.

1.1 Company Summary

Gamehenge Tapers Co-op is a co-operative organization designed to serve the Portland tapers community. The tapers community is a hobby based group that records and trades live concerts. All of the bands that allow live recordings are "live" or "jam" bands who incorporate improvisation into their live performances so each performance is unique. The group members trade these live performances for personal consumption, enjoying the unique attributes of each individual show. Commercial use of these shows is strictly prohibited.

The organization sells a wide range of equipment for tapers. The equipment is purchased through normal wholesale distribution channels and sold directly to organizational members. Membership is required for entry to the co-op. A $40 entry fee and proof of traders status (a copy of your show list is usually sufficient) is all that is needed to become a member. Products must be purchased through the website and can be picked up from the office at certain times throughout the week. Questions regarding products can be answered via email or phone (typically voicemail with a return phone call).

2.0 Situation Analysis

Gamehenge Tapers Co-op is entering their first year of operation and recognizes the need of a comprehensive marketing plan to ensure future sustainability. The Co-op provides an extensive offering of recording equipment as well as CD-RWs and media. This serves the market need of providing equipment and information for tapers.

Gamehenge Tapers Co-op

Page 1

2.1 Market Summary

Gamehenge Tapers Co-op possess good information about the market and knows a great deal about the common attributes of the most prized customers. The Co-op will leverage this information to better understand who is served, their specific needs, and how The Co-op can better communicate with them.

Table 2.1: Target Market Forecast

Target Market ForecastPotential Customers Growth 2002 2003 2004 2005 2006 CAGRTapers 10% 200 220 242 266 293 10.02%Other 0% 0 0 0 0 0 0.00%Total 10.02% 200 220 242 266 293 10.02%

2.1.1 Market Demographics

The profile for Gamehenge Tapers Co-op's customer consists of the following geographic, demographic, and behavior factors:

Geographics

• The immediate geographic target is the city of Boulder with a population of 267,000. • A 35 mile area is in need of the services. • The total targeted population is 638.

Demographics

• Primarily male. • Ages 18-40. • Have attended at least some college, some have graduate degrees. • Have an annual income range of $25,000-$85,000.

Behavior Factors

• Maintain an extensive collection of music. • Spend on average $100 a month on taping equipment/media or commercial music. • Are often very picky regarding their music collection including: labeling, file formats, media

brands, audio source (soundboard vs. microphones).

2.1.2 Market Needs

Gamehenge Tapers Co-op is providing its members with a good selection of recording equipment for taping purchases. Gamehenge Tapers Co-op seeks to fulfill the following benefits that are important to its members.

• Selection: A wide selection of equipment and media used in live audio taping is offered. • Accessibility: All equipment is distributed through a conveniently located Boulder office

space. • Source of Intellectual Capital: Only some of the different nuances of taping are available

on the Internet, therefore there is a real demand for tips on taping. By having professional tapers manning the Co-op, the Co-op becomes a clearinghouse for taping information.

• Competitive Pricing: By operating the Co-op as a not-for-profit, the organization is able


Page 2

to extend excellent pricing to its members.

2.1.3 Market Trends

Taping is a trend with increasing number of bands enthusiastically supporting taping. By having a larger source of material that can be taped and traded, there has been a proliferation of the taping community. For years up until the early 90's, there were very few bands that encouraged taping. The one glaring exception is the Grateful Dead, which for decades recognized the value of allowing taping and trading of their shows. The spirit of the Dead has lived on in over 100 different bands today that encourage taping and trading. With a significant increase in the number of bands that allow taping, which in effect has increased the community of tapers, the taping community is maturing into a recognized market segment.

0

50

100

150

200

250

300

2002 2003 2004 2005 2006

Tapers

Other

Market Forecast

2.1.4 Market Growth

The taping community/market has really grown in the last decade. In 1999, tapers consumed $346 million in equipment and media. As the number of bands that encourage taping continues to grow, it is forecasted that this specialty market will grow at 9% a year for the next three years. The increased allowance of taping by bands is one variable that has contributed to market growth. Another factor is the state of current technology. Computer-based CD recorders have promoted market growth by creating a new format for recording shows that is convenient and a perfect copy.


Page 3

0.00%

2.00%

4.00%

6.00%

8.00%

10.00%

Tapers Other

Target Market Growth

2.2 SWOT Analysis

The following SWOT analysis captures the key strengths and weaknesses within the company and describes the opportunities and threats facing Gamehenge Tapers Co-op.

2.2.1 Strengths

• Solid relationships with distributors who are very supportive of the idea of a co-op and willing to support Gamehenge.

• A solid base of dedicated staff who are passionate about making Gamehenge succeed. • Below-market prices for hobby tapers.

2.2.2 Weaknesses

• A lack of awareness of Gamehenge by many local tapers. • By virtue of the fact that Gamehenge will never have a large revenue stream, the

marketing budget will always be small. • A limited base of users because taping may never be a mainstream hobby.


Page 4

2.2.3 Opportunities

• Boulder, Colorado is a hot bed for good music, with a lot of music artists passing through and many music aficionados living in Boulder.

• Low overhead allows the savings to be passed onto the members. • 501(c)(3) status eliminates taxes for the organization.

2.2.4 Threats

• Mail order firms that buy in bulk quantities so the prices they extend to consumers are comparable, or better than Gamehenge's pricing.

• Federal regulation that significantly changes not-for-profit status requirements.

2.3 Alternative Providers

Regular retail outlets are Gamehenge's competition. These take the form of mail order places, retail outlets, and e-commerce sites. These for profit competitors might offer a better selection, but, they will rarely compete on price.

2.4 Services Offered

Gamehenge Tapers Co-op offers the tapers community the following products:

• CD-RW (Compact Disc ReWritable) drives for computers, external units with USB, SCSI or Firewire connections.

• High quality stereo microphones for audience taping. • DAT (digital audio tape) portable recorders. • CD-R (Compact Disc Recordable) media.

2.5 Keys to Success

The keys to success are:

• Provide a needed service/products. • Serve the organizational members. • Support the hobby of taping. • Build a strong membership base.


Page 5

2.6 Critical Issues

Gamehenge Tapers Co-op is just beginning their first year of operation. Its critical issues are to continue to take a modest fiscal approach, and build membership, this is the only way the organization will succeed.

3.0 Marketing Strategy

Gamehenge Tapers Co-op's marketing budget is quite limited, particularly at start up because the budget is dependant on the number of members that are signed up. The marketing strategy will employ two activities. The first is a networking campaign, the second will be the use of a website. The networking activities will be accomplished by both the officers of the organization as well as a grassroots networking scheme to try to involve all of the members. These efforts will be further defined in subsequent sections.

3.1 Mission

Gamehenge Tapers Co-op' s mission is to serve the Boulder tapers community. We exist to attract and maintain members. When we adhere to this maxim, everything else will fall into place. Our services will exceed the expectations of our customers.

3.2 Marketing Objectives

• Increase the membership base 5% each quarter. • Decrease customer acquisition costs by leveraging individual membership networking. • Increase visibility of the organization at various concerts.

3.3 Financial Objectives

• Profitability. • A decrease of overhead costs by 5% every two quarters. • A significant increase in sales to warrant hiring a part-/full-time employee.

3.4 Target Markets

Gamehenge Tapers Co-op will be addressing the tapers community in the Boulder area. The taping community is made up of individuals that legally tape live concerts. There are a handful of bands that allow taping of their live performances. Generally, record labels discourage or ban taping of live performances because they believe that it infringes on profits from record sales. Gamehenge has found that taping tends to promote the band as there is an entire community that trades these shows, attends the concerts, and buys the records after they hear live performances of the band.

From a legal standpoint, the live performances are copyrighted, and it is only a few select bands that allow tapings. These bands tend to be very good live performers, with a loyal following of people that tour with them and consequently these bands tend to play entirely different set lists each night recognizing that there are people seeing several shows in a row.


Page 6

The bands that allow recording of live concerts are the remnants of the Grateful Dead (Phil Lesh & Friends, The Other Ones) remnants of Phish (Trey Anastatio and the Giant Country Horns), String Cheese Incident, moe., Blues Traveler, Dave Matthews Band, Medeski Martin & Wood, Tony Furtado, Bela Fleck and the Flecktones, Widespread Panic, Galactic, Government Mule, Greyboy Allstars, Karl Denson and the Tiny Universe, and many more.

These bands have a loyal following; a very close knit community. This element lends itself to word of mouth promotion.

3.5 Positioning

Gamehenge Tapers Co-op will position itself as a co-op whose mission is to support the local tapers/traders community in Boulder with cost plus equipment, media and information. Gamehenge will leverage its competitive edge to achieve this positioning.

Gamehenge Tapers Co-op's competitive edge is its co-operative business structure. The organization is set up to solely benefit the members. The members benefit by being able to purchase equipment at drastically reduced prices compared to retail.

3.6 Strategy Pyramid

The single objective is to position Gamehenge as an invaluable resource organization for the local taper/trader community. The marketing strategy will seek to first create customer awareness regarding the services/products offered and then develop the member base.

The message that Gamehenge will seek to communicate is that Gamehenge provides invaluable support for members of the organization in regards to information and equipment for taping live concerts. The message will be communicated in various ways. The first is through a networking campaign accomplished by the different officers of the organization. Since the officers are all avid tapers, they will network with the close knit taping community at all of the events. A second type of networking that will be employed is a networking campaign on behalf of the individual members. A comprehensive pamphlet will be handed out and explained to new members. The pamphlet will detail how each member can make a contribution to the organization by bringing new members in. This effort will be explained as not only helping the organization as a whole but also helping each individual member with the lure of lower prices as the organization grows. The pamphlet will detail simple steps that members can do when they run into tapers that are not a part of the organization.

The last way that the message will be communicated is through the website. The website will be a comprehensive source of information about Gamehenge, its members, and the services/products that Gamehenge offers.


Page 7

3.7 Marketing Mix

Gamehenge Tapers Co-op's marketing mix consists of the following approaches to pricing, distribution, advertising and promotion, and customer service.

• Pricing: The pricing scheme will be product cost plus variable overhead costs associated with each sale.

• Distribution: All products are available from Gamehenge's store. • Advertising and Promotion: The most effective activities will be networking and a

website. • Customer Service: Customer service will be of a high level. This takes into account the

fact that all of the customers are owners of the co-op, so there is a natural incentive to treat them properly.

3.8 Marketing Research

To aid in market research, Al conducted several focus groups. The goal of the focus groups was to determine if Gamehenge did indeed provide a market need for Boulder tapers and traders. Al held two focus groups with seven people each. The people were taping acquaintances that he had met over the years. The focus groups explored numerous ideas regarding the Gamehenge business model, including how much people would be willing to spend to become members, what products should be offered, what their consumption schedules are, and other details. The results of the focus groups were quite illuminating and offered a lot of information that shaped both the business as well as the marketing plan.

4.0 Financials

This section will offer a financial overview of Gamehenge Tapers Co-op as it relates to the marketing activities. Gamehenge will address break-even analysis, sales forecasts, and expenses forecasts.

4.1 Break-even Analysis

The break-even analysis indicates that $347 is needed in monthly sales to break even.


Page 8

($500)

$0

$500

$1,000

$1,500

$2,000

$2,500

$0 $500 $1,000 $1,500 $2,000 $2,500

Monthly break-even point

Break-even point = where line intersects with 0

Break-even Analysis

Table 4.1: Break-even Analysis

Break-even Analysis:Monthly Units Break-even 1Monthly Sales Break-even $347

Assumptions:Average Per-Unit Revenue $250.00Average Per-Unit Variable Cost $20.00Estimated Monthly Fixed Cost $319

4.2 Funding Forecast

The first month will be used to set up the office and website. The office will be in a small space with low rental costs. The website will be designed to provide general information to the public and detailed product information regarding the products offered. Members will only be able to purchase products via the website and picked up from the office at certain times.

Month two will see an increase in sales and membership. The following months will see both membership as well as sales activity.


Page 9

$0

$500

$1,000

$1,500

$2,000

$2,500

$3,000

$3,500

$4,000

$4,500

$5,000

Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec

Equipment sales

Membership income

Monthly Funding Forecast

Table 4.2: Funding Forecast

Funding ForecastFunding 2002 2003 2004Equipment sales $37,294 $41,545 $42,154Membership income $3,760 $2,500 $2,800Total Funding $41,054 $44,045 $44,954

Direct Cost of Funding 2002 2003 2004Equipment sales $33,565 $37,391 $37,939Membership income $0 $0 $0Subtotal Cost of Funding $33,565 $37,391 $37,939

4.3 Expense Forecast

The marketing expenses will be budgeted so that they are fairly consistent through the year. The website will have a steady fee per month for the hosting fees. The networking expenses will be ramped up in the beginning to raise visibility as a start up, but will be fairly even the rest of the year.


Page 10

$0

$20

$40

$60

$80

$100

$120

$140

$160

$180

Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec

Networking

Website

Monthly Expense Budget

Table 4.3: Marketing Expense Budget

Marketing Expense Budget 2002 2003 2004Networking $1,350 $1,200 $1,200Website $600 $600 $600

------------ ------------ ------------Total Funding and Marketing Expenses $1,950 $1,800 $1,800Percent of Funding 4.75% 4.09% 4.00%Contribution Margin $5,539 $4,855 $5,215Contribution Margin / Funding 13.49% 11.02% 11.60%


Page 11

5.0 Controls

The purpose of Gamehenge's marketing plan is to serve as a guide for the organization. The following areas will be monitored to gauge performance:

• Sales: monthly and annual. • Expenses: monthly and annual. • Increases in membership.

5.1 Implementation

The following milestones identify the key marketing programs. It is important to accomplish each one on time, and on budget.

Jan Feb Mar

Marketing plan completion

Website development

Networking campaign

Milestones

Table 5.1: Milestones

Milestones PlanMilestone Start Date End Date Budget Manager DepartmentMarketing plan completion 1/1/02 2/1/02 $0 AlWebsite development 1/1/02 2/1/02 $0 ITNetworking campaign 1/1/02 ongoing $1,350 everyoneTotals $1,350


Page 12

5.2 Marketing Organization

Al Truistic is primarily responsible for the marketing activities. Al will receive help for the creation and maintenance of the website.

5.3 Contingency Planning

Difficulties and Risks

• Problems generating visibility on a limited marketing budget. • Inability to have competitive prices if a bulk buyer is able to get better deals from

wholesalers than Gamehenge can.

Worst Case Risks May Include

• Determining that the business cannot survive solely on membership fees. • Having to liquidate inventory to cover liabilities.


Page 13

Table 4.2 Funding Forecast

Funding Forecast PlanFunding Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov DecEquipment sales $0 $1,545 $2,587 $3,654 $3,878 $4,578 $3,254 $4,578 $2,587 $3,124 $3,385 $4,124Membership income $160 $360 $400 $480 $400 $200 $360 $200 $360 $280 $200 $360Total Funding $160 $1,905 $2,987 $4,134 $4,278 $4,778 $3,614 $4,778 $2,947 $3,404 $3,585 $4,484

Direct Cost of Funding Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov DecEquipment sales $0 $1,391 $2,328 $3,289 $3,490 $4,120 $2,929 $4,120 $2,328 $2,812 $3,047 $3,712Membership income $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0Subtotal Cost of Funding $0 $1,391 $2,328 $3,289 $3,490 $4,120 $2,929 $4,120 $2,328 $2,812 $3,047 $3,712

Appendix: Gamehenge Tapers Co-op

Page 1

Table 4.3 Marketing Expense Budget

Marketing Expense Budget Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov DecNetworking $125 $125 $125 $100 $100 $125 $125 $125 $100 $100 $100 $100Website $50 $50 $50 $50 $50 $50 $50 $50 $50 $50 $50 $50

------------ ------------ ------------ ------------ ------------ ------------ ------------ ------------ ------------ ------------ ------------ ------------Total Funding and Marketing Expenses $175 $175 $175 $150 $150 $175 $175 $175 $150 $150 $150 $150Percent of Funding 109.38% 9.19% 5.86% 3.63% 3.51% 3.66% 4.84% 3.66% 5.09% 4.41% 4.18% 3.35%Contribution Margin ($15) $340 $484 $695 $638 $483 $510 $483 $469 $442 $389 $622Contribution Margin / Funding -9.38% 17.82% 16.19% 16.82% 14.91% 10.10% 14.12% 10.10% 15.90% 13.00% 10.84% 13.88%

Appendix: Gamehenge Tapers Co-op

Page 2

non-profit recording co-op marketing plan

Documents