A boat charter business is only as good as its marketing plan. How good is yours?
The importance of a thoughtful marketing plan can't be overstated for any business. All the more so for owners of charter boats that may need to convince the federal government - the IRS - they are operating a legitimate business with a true profit motive. No legitimate marketing plan - maybe not a real business.
Many of the leading yacht brokers and yacht charter brokers include basic “marketing services” now as part of their management services. There are also “marketing services” and magazines, producers of web sites, brochures, videos, yacht shows, social media and a wide range of “experts” of all types that can help promote a yacht.
A yacht charter broker with a web site is not a marketing plan.
It's frequently observed, that failing to plan is planning to fail. That would seem to be a logical explanation for the extremely high rate of charter boat businesses that consistently fail to earn any net profits or even positive cash flow.
Perhaps charter boat owners don't really
understand what a marketing plan is and is not.
Or how important a marketing plan is for a
business to earn a profit.
Since many charter boat owners are - or should be-
concerned about how the IRS may view their boating
activities, perhaps it would be instructive to consider
what another federal agency - the Small Business
Administration- has to say.
A marketing plan includes everything from understanding your target market and your competitive position in that market, to how you intend to reach that market (your tactics) and differentiate yourself from your competition in order to make a sale.
That's why it's important to include a plan for measuring your spend. Consider what impact certain marketing activities have had on your revenues during a fixed period, such as a business quarter, compared to another time period when you focused your efforts on other tactics. Consider the tactics that worked as well as those that didn’t work. You don't have to cut the tactics that didn't work, but you should assess whether you need to give them more time to work or whether the funds are best redirected elsewhere.
Marketing plans should be maintained on an annual basis, at a minimum. But if you launch a new product or service, take time to revisit your original plan or develop a separate campaign plan that you can add to your main plan as an addendum.
Legitimate marketing of a business with a profit motive is not a one time set and forget process.
For the yacht owner concerned about an IRS tax audit and the possible consequences of him taking "business tax deductions" for his yacht charter business that has not made, and will not make, substantial net after tax profits 3 out of five 5 years, he has to do something different.
He can't just keep doing the same thing, the same way, with the same people and expect different results - or expect to turn a net profit. He needs to actually make a profit - or at least begin making the necessary changes that might lead to profitability.
He needs to do something new, find a new direction, take a new course. He needs Corpen.
Corpen can solve those problems by building upon the existing foundation of the current yacht management and marketing efforts. But by adding a new competitive advantage, we elevate the usual charter yacht from just the basic"commoditypricing structure" to premium pricing. Taking cash flow to the next level- net profits.
Marine marketing that actually produces a consistent net profit, demands so much more than just pretty pictures and descriptive copy on a yacht broker’s web site, a brochure, magazine advertising, a video, or an occasional tweet, email, or other social exchange.
It starts with your business plan - specifically your marketing plan. So what is yours like?
This should clearly map out your financial objectives,
the resources needed, and the best course to take to
reach those goals. Both your business and marketing
plans should be annually reviewed and amended to
address current problems and prepare for expected
future economic conditions.
Planning for the future and determining the best
course to take requires vision. Particularly long
range vision. You want to see what others can't
see yet, in order to position your business ahead
of the competition. That's true in any business,
and so it is in the yacht charter business.
Again, it may be instructive to review what Rieva Lesonsky blogging for the federal government"s SBA says-
"Clearly, creating a marketing plan makes a big difference in achieving your goals. Here’s what you should include in your marketing plan:
1. Who are your target customers? Do your market research to understand where your target customers live, their demographics (age, sex, marital status, income, etc.), their spending habits and anything else that makes them ideally suited for your product or service.
2. Who are your competitors? Which companies compete with you for your ideal customers? How do they market themselves, what are their Unique Selling Propositions (USP) and what differentiates your business from theirs? How will you need to market your business to stand out from the competition?
3. Where do your target customers get their information? To determine what marketing methods and channels will work best for you, you need to know, for example, if your target customers read newspapers or get news online, use social media or don’t even know what that is, watch TV or listen to the radio and what websites/publications/stations they read, watch and listen to.
4. What are your marketing goals? If you’re launching a brand-new product, your goal might simply be to raise awareness of what you sell and build your brand name. If you’ve got a long-standing business with a well-established brand, your goal could be to sell more to existing customers. Be sure your goals are measurable—not just “to sell more” but “to increase sales to existing customers by 10 percent per quarter” or other specific numbers.
5. How will you market the business? Based on your understanding of point #3, your marketing plan should list the different marketing and advertising methods you’ll use, such as social media, print advertising, online advertising, event marketing, etc.
6. What’s your marketing budget? It’s important to set a budget for your marketing plan. Measure what you actually spend against your budget forecast.
7. How will you measure success and how often? Marketing takes time to work, so don’t assume that a campaign isn’t worth the money if you don’t see immediate results. However, it’s a good idea to measure results quarterly and see which marketing tactics are working best (or not working at all). That way you can redistribute your budget as needed.
Review your overall marketing plan at least once a year. Today, the world of marketing is changing at lightning speed, and your business needs to keep up."
It is obvious why just placing a boat with a charter management company is not a marketing plan, and why such a practice consistently fails to produce net profits for the owner of the charter boat.
Corpen is uniquely designed to rectify this situation and restore profitability. It's expertise in managerial economics and behavioral economics which are keystones of modern marketing strategies provides unique insights that few if any yacht brokers, or yachting professionals could be expected to possess.
If you are a yacht owner with a yacht in charter and your existing marine marketing efforts consistently fail to produce substantial profitability, perhaps it’s time for a new direction - a course correction. A new tack may be required in order to achieve your financial objectives and get you to where you want to go – and may need to go - before the IRS inquires of your true yachting motives.
Corpen signals a new direction for yacht owners and marine professionals that expect their marketing efforts to actually enhance their bottom line net profitability. Following Corpen’s new direction can also signal to the IRS a yacht owner with a legitimate profit motive willing to make a change in search of greater profitability and not just a yacht owner with a hobby, content with annual losses as just part of the expense of enjoying the yachting lifestyle.