The profit on a particular business is always a function of the amount of units the business sells, times the margin made on each unit, less the marketing expense involved, less the direct overhead. Marketing expenses include things such as advertising, promotions and public relations efforts.
slide 4 of 7. Which Comes First An overall business strategy is outlined in the business plan. Since the marketing plan and marketing strategies are a part of the overall plan, they are included in the business plan. Financiers and lenders can use the marketing plan as a pullout from the business plan.
Now, we address our second question. What is the difference between a strategy and a business model? A strategy is about the external logic of a business. How are we going to compete? Check out my earlier post on the elements of a strategy for more about strategies. A business model is about the internal logic of the business. See my post on the elements of a business model. Does it make operational and economic sense? Do all of the pieces fit together? A business model is a tool that complements both a business strategy and a business plan. It is an important tool because 1) it ensures that you understand the logic of your business; and, 2) it helps you communicate the logic of your business. Of course, this begs the question, what is a business plan?