City of Grand Marais
Cedar Grove Business Park
Strategic Marketing Plan
Christo Robberts and Kenneth Johnson
September 2010
About The EDA Center
The EDA Center at the University of Minnesota, Crookston is one of
more than 40 university centers nationwide, supported by the Economic
Development Administration, U.S. Department of Commerce. The EDA
Center conducts applied research, provides direct technical assistance
and delivers educational programs to economic development agencies
that support the economy of economically-distressed communities
throughout Minnesota.
Our Mission:
Our mission is to engage university faculty, staff and students with local,
county, tribal and regional economic development agencies in support
of our Minnesota economy. Our focus is to utilize the capacity of the
University of Minnesota, Crookston in partnership with the broader U of M
system and economic development agencies to support job creation, capital
investment, business recruitment and job retention.
To learn more about The EDA Center go to: www.umcedacenter.org
This document was prepared by the University of Minnesota, Crookston under award number 06-66-05304
from the Economic Development Administration, U.S. Department of Commerce. The statements, findings,
conclusions and recommendations are those of the author(s) and do not necessarily reflect the views of the
Economic Development Administration or the U.S. Department of Commerce.
© 2009 The EDA Center at the University of Minnesota, Crookston
Contents
Executive Summary................................................................................................3
Introduction.............................................................................................................3
Cedar Grove Business Park Basic Information...................................................3
Mission.....................................................................................................................4
Cedar Grove Business Park Map..........................................................................5
Access to Markets/Customers/Suppliers...........................................................5
Available Services and Suppliers in Grand Marais...........................................6
Education & Training Resources..........................................................................7
Schools and Medical Services................................................................................7
Proximity to Urban Amenities..............................................................................7
Access to Airports...................................................................................................7
Gateway to Parks and Recreation.........................................................................8
Targeted Business Attraction................................................................................8
Targeted Sectors......................................................................................................8
Strategic Issues........................................................................................................9
Competition.............................................................................................................9
Challenges and Options Regarding Cedar Grove............................................10
Incentive Opportunities.......................................................................................10
Strategic Analysis..................................................................................................12
Internal Analysis...................................................................................................12
Competitive Profile Matrix..................................................................................12
Internal Analysis...................................................................................................13
-1-
IFE Matrix for Grand Marais...............................................................................13
External Analysis..............................................................................................................14
EFE Matrix for Grand Marais..........................................................................................14
Stage Two – Matching Stage............................................................................................15
Strengths-Weaknesses-Opportunities-Threats Matrix (SWOT).................................15
Strategic Position and Action Evaluation (SPACE) Matrix........................................16
SPACE Matrix....................................................................................................................16
Marketing Strategies.........................................................................................................17
Marketing Program..........................................................................................................18
Product Strategy................................................................................................................18
Promotional Strategy:.......................................................................................................18
Marketing Objectives........................................................................................................18
By October 2011:................................................................................................................18
By October 2015:................................................................................................................18
Proposed Marketing Channels........................................................................................18
Marketing Budget.............................................................................................................19
Summary............................................................................................................................20
-2-
Executive Summary
The Cook County/Grand Marais Joint Economic Development Authority (EDA)
requested assistance from the EDA Center at the University of Minnesota
Crookston to develop a strategic marketing plan for the Cedar Grove Business
Park. Presently, the sale of lots in the park has been disappointingly slow. Many
community members have lost faith in the ability of the business park to contribute
positively to the tax base. There is a current debt of $1.6 million (well over $2
million with interest) and annual payments of approximately $130,000 over the
next 20 years (Hakes, 2010). Repayment of business park debt is a concern and
burden to taxpayers which can only be alleviated through the attraction of viable
businesses to the park.
Without intervention, all analyses that were done indicate a less than optimistic
outlook for the Cedar Grove Business Park. With the existing business plan the
best the community can do is divest itself of the financial burden and write off the
project as a failure. It is therefore of paramount importance that the business plan
is revamped and incorporate a new business paradigm with concomitant positive
outcomes.
The present marketing efforts have not delivered the expected results. It is
suggested that a more proactive marketing strategy could prove extremely
effective. The strategies include the development, optimization, and promotion
of a new website specifically designed to introduce Cedar Grove Business Park
to prospective investors as well as establishing a personal presence at key trade
shows on a national basis. Another approach would be the establishment of a
business incubator to groom new entrepreneurs into future business park
investors. Although the initial response to the business park has been less than
expected, the park has potential to fulfill the aspirations that the community had
when the park was proposed.
Introduction
The City of Grand Marais developed the Cedar Grove Business Park with 33 lots
on 85.56 acres in the beautiful North Shore area of Minnesota. The Cedar Grove
Business Park lots range from 1 to 4 acres in size and they are situated with easy
access to highway 61. The Business Park is included in the State of Minnesota’s taxfree Job Opportunity Building Zone (JOBZ) and qualifying business will be able to
make use of this additional perk. Grand Marais is a vacation destination area with
easy access to Duluth to the southwest and Thunder Bay to the northeast. It is also
the county seat of Cook County, Minnesota.
Cedar Grove Business Park Basic Information
The Cedar Grove Business Park is zoned for commercial development to allow for
service-based and manufacturing business opportunities. It has convenient access
to Highway 61 to Canada and Duluth, Minneapolis. Cedar Grove is situated in a
park-like setting, with easy access to recreational areas and facilities. The regulations and design restrictions will enhance and preserve the value of the lots for
investors in Cedar Grove.
-3-
Mission
Grand Marais (2008 pop. est. 1,418) is a quaint harbor town on Lake Superior in
far northeastern Minnesota. Home to a thriving tourism industry with unique
small businesses and a thriving artistic community, Grand Marais has tremendous
potential for technology companies, customer service centers, and resource-based
light manufacturing.
The City of Grand Marais decided to develop the Cedar Grove Business Park as its
primary focus for economic development. Eighty-five acres of the city’s business
development area are designated as tax-free under a statewide initiative called Job
Opportunity Building Zones (JOBZ). Add a local loan fund, and Grand Marais
offers unique incentives to businesses that want to grow off the beaten path.
The Grand Marais airport is located seven nautical miles northwest of the central
business district in an area covering 220 acres with one runway designated 9/27
with a 4,199 X 75 ft asphalt surface. For a 12 month period ending July 31, 2005, the
airport had 3,200 general aviation aircraft operations, an average of 267 per month.
Grand Marais is the county seat of Cook County, Minnesota. Covering the tip of
the Arrowhead Region of Northeastern Minnesota, many have said without Cook
County there would be no point to Minnesota.
The city of Grand Marais has a total area of 2.7 square miles located on the
Northwestern shore of Lake Superior and is well known as an entry point for the
Boundary Waters Canoe Area and Superior National Forest. Road access is by
Minnesota State Highway 61 which follows the scenic shore of Lake Superior
to Canada and has been designated as a Minnesota Scenic Byway and an All
American Road.
As of the 2000 census, there were 1,353 people, 645 households, and 341 families
residing in the city of Grand Marais. The 2007 estimated population for the
entire County is 5,398. The median income for a household in the city was $33,493,
and the medium income for a family was $46,563. Males had a median income of
$31,500 versus $23,393 for females.
The water system, the light and power system, the sanitary and storm sewer
system including the sewage disposal plant is under jurisdiction of the City’s
Public Utilities Commission. Fire service is provided by the Grand Marais
volunteer fire department.
With the completion of the new $12,000,000 airport upgrade many of the pristine
natural resources of the Cook County community will become even more
accessible to the people of Minnesota, Wisconsin and Manitoba. The reduction in
travel time for people and goods will benefit early investors in the area and will
result in the community being a more attractive place to manufacture high value
goods.
Once the airport is upgraded to “key airport” status, the 5,000 foot runway will
allow for the landing of larger multiengine aircraft and the majority of corporate
jets, which can include operation of private and corporate aircraft as well as
express air freight services.
-4-
Cedar Grove
Business Park Map
Access to Markets/Customers/Suppliers
Businesses can reach out to over 80% of the population of Minnesota, Wisconsin,
Manitoba and Ontario in one day’s truck drive from Cedar Grove Business Park.
The airport upgrade will allow for national and global reach within one day. This
is important for high value manufacturing of technology and information related
industries. For information service industries future high speed access will allow
immediate access on a global scale.
-5-
-6-
Education and Training Resources
The University Minnesota, Duluth (UMD) Center for Economic Development
assists entrepreneurs and businesses with training, education, and other resources.
UMD itself provides a rich pool of graduates with majors in business, engineering,
the sciences, human services, and others.
Hibbing Community College, approximately 185 miles from Grand Marais,
provides the region with graduates well-trained for careers in various fields of
business, computers, medical, culinary, and trade and industry.
Located approximately 175 miles from Grand Marais in Virginia, Minnesota,
Mesabi Range Community and Technical College provides certificates, diplomas,
and AAS degrees designed to prepare students for employment immediately
upon graduation. Offerings at Mesabi include computer technology, electrical and
industrial automation technology, industrial technology, medical, welding, wind
energy technology and several other trade programs.
Schools and Medical Services
Grand Marais is home to 5 schools with a total of 609 students. With 39 teachers,
the student to teacher ratio is a15.54:1. The Cook County North Shore Hospital
and Care Center serves the community with a 24 hour physician staffed 3 bed
emergency room as well as a 16 bed inpatient critical access facility and 47 bed
skilled nursing facility. However, the nursing facility is considered currently full at
42 residents. Outpatient services are available.
Cook County North Shore Hospital and Care Center is well-suited for general
family care. However, residents must travel to Duluth or beyond for emergency
and elective surgeries. The Center has no specialty care, such as orthopedics or
neurology, and only low-risk births are allowed at the facility.
Proximity to Urban Amenities
The city of Grand Marais has attractive recreation and shopping opportunities
given its location and size. When a larger market is desired, Duluth is just a
leisurely 2 hour drive away with an export harbor, museums, theaters, restaurants,
and up-scale shopping mall experiences. Also, Thunder Bay is just 1 hour away
with similar entertainment amenities.
Access to Airports
Grand Marais is situated between the Duluth and Thunder Bay commercial
airports. The Duluth Airport Board was successful in securing non-stop service to
Chicago since December 2009 by United Express. The merger of Delta Air Lines
and Northwest Airlines could result in non-stop service from Duluth to Atlanta,
Cincinnati, Salt Lake City and Thunder Bay airports. The Thunder Bay Airport
is the 6th busiest airport in Ontario and the 22nd busiest airport in Canada. The
distance from Grand Marais to Duluth is 110 miles and it is 80 miles from Thunder
Bay.
-7-
Gateway to Parks and Recreation
In addition to the local recreation and leisure possibilities afforded by Grand
Marais the area is the start of the Gunflint Trail, home to the renowned Superior
National Golf Course at Lutsen, boating, fishing, hiking, and relaxation at a
multitude of bed & breakfast or state lodges in the area.
Targeted Business Attraction
The key location assets that are identified will enable for the identification of the
types of industries which will be actively recruited to the Cedar Grove Business
Park. These strategic resources will be utilized to promote the attraction of specific
types of businesses to the area. With this in mind, the industry targets are a mix
that (1) will enhance and add to the diversity of the current employment in the
city (2) increase the essential tax base in the area (3) pursue the highest quality of
jobs and investment and (4) provide an overall balanced approach to economic
development for the city.
Targeted Sectors
There are many businesses that are not encumbered by logistical problems as
regular manufacturing companies would be. The ventures that will be targeted in
the marketing strategy includes:
There are many businesses that are not encumbered by logistical problems as
regular manufacturing companies would be. The ventures that will be targeted in
the marketing strategy includes:
• Technology Industry -With all its natural beauty and remoteness it is
possible to manufacture technology-related products with a skilled, high paid workforce in the area. The cost of the product and the non-spoilable
nature of the product will allow for road or air transportation.
• Information Management and Database Management – High-speed
internet capability will make Grand Marais as close to everywhere else as
any other place on the globe.
• Small to Mid-size Professional Service Firms- To service the area from
Thunder Bay to Duluth – there is a need for technical service providers for
the industrial, commercial, and residential applications in the area.
• Call/Service Centers- Ranging from telemarketing of products and
services to maintenance and servicing of existing accounts can create
optimum levels of employment per developed space. A 10-20,000 sq. ft.
building space can create 100-200 jobs. Although not as high paying as
manufacturing or technical positions, wages compare to distribution
facilities and hours are flexible and geared toward a part-time worker, or
second job possibility. Typical call centers will be located in an industrial or
mixed office/industrial setting and present attractive building alternatives.
• Artistic Commodity – The area has long been acknowledged for its
artistic entrepreneurs with the possibility to attract more artists into the community and possibly Cedar Grove.
• Pharmaceuticals and Cosmetics – Anything from the lake that has special
application in pharmaceuticals and cosmetic industries should be leveraged
to attract new manufacturing.
-8-
Strategic Issues
There are many issues facing Cedar Grove which will prove challenging over the
coming years. However, these challenges can be circumvented with an effective
marketing strategy which differentiates Cedar Grove from a plethora of other
options prospective business owners have in today’s competitive environment.
The Cedar Grove Business Park’s recruitment efforts have been hindered greatly
by the current economic recession, which according to the National Bureau of
Economic Research (2010) has existed since December 2007 and continues today.
In fact, several businesses which provided Cedar Grove with deposits to reserve
lots are no longer planning on building in Cedar Grove due to the recession. In
addition, competition among business parks for prospects has intensified greatly
as a result of the recession. Although this of course proves problematic, the
uniqueness and affordability of the Cedar Grove Business Park can provide
differential advantages over comparable business parks in these challenging
economic times.
The location of Grand Marais is perhaps both the greatest strength and weakness
for Cedar Grove. The location certainly limits the amount and type of businesses
which would be interested in investing in a remote location with limited infrastructure. For certain types of businesses and specific types of owners, the
location can prove to be the dealmaker and the lack of infrastructure may be
not be important. The key is to create a targeting strategy which effectively screens
prospects and devotes resources to the right type of target. This will ensure
efficient use of resources in the recruiting process and hasten the selling of Cedar
Grove lots. It is also important to leverage all the development funds available to
new business enterprises in the Arrowhead Region in the marketing of the lots.
They include the Northeast Entrepreneur Fund, the Small Business Development
Center, and the University of Minnesota, Duluth Center for Economic Development are just a few options available to prospective business owners.
Competition
There are several viable business parks in cities that are relatively close to
Grand Marais that have many of the same attractive features of Cedar Grove. For
example, the Silver Bay Business/Industrial Park is approximately 55 miles closer
to Duluth. Also, Silver Bay offers many of the same quality-of-life benefits as does
Grand Marais, including beautiful scenery, hunting, fishing, shore access, golf, and
other recreation.
Along the north shore of Lake Superior approximately 80 miles northeast of Grand
Marais is the Innova Business Park. Located in Thunder Bay, Ontario, the Innova
Business Park is designed for service and manufacturing businesses. Again, there
is similar access to attractive recreational opportunities within close proximity of
the park which are comparable to Grand Marais. More concerning, however, is the
infrastructure development of the Thunder Bay area. State of the art data transmission is currently available and international transportation access via rail, port, air
and highway is far superior to what currently exists in Grand Marais.
The city of Duluth provides many resources and incentives for start up and existing businesses. The infrastructure of Duluth is supportive of a far more diverse
pool of prospective businesses than Grand Marais, with superior transportation
and other business options. However, the remoteness and quaintness of Grand
Marais positively differentiates it from the city atmosphere of Duluth.
-9-
Challenges and Options Regarding
Cedar Grove
The City of Grand Marais will have to decide how to proceed. The strategic
balance will have to be reached where the sale of a lot is balanced against lost
revenue in property taxes and escalating costs to keep the lots in the present
condition. The vibrancy of Cedar Grove is dependent upon the symbiotic
relationship of the different business owners. In the present scenario where a
few businesses are developing their lots, the empty lots will not increase the
business traffic in the Business Park and it may prove to be a detrimental factor
for the businesses trying to establish themselves.
The city administrators will have to decide what is in the best interest of the city.
The options that are available include:
• Sell the lots at the present price for light manufacturing purposes as
proposed.
• Sell the lots at the present price for light manufacturing and service
providers.
• Sell the lots at the present price for light manufacturing, service providers,
and retail.
• Sell the lots at the present price for service providers, retail, and for
building high density housing.
• Reduce the price of the lots or supply other incentives to establish any of
the abovementioned businesses.
Incentive Opportunities
In the competitive market of rural Minnesota there are many communities each
promoting its location as most beneficial for establishing new businesses. In order
to compete on a “level playing field” with areas that have better situations with
regard to markets and workforce the use of all possible business incentives will
have to be considered. Especially when considering the addition of businesses
that will create high paying jobs, large capital investments, involving innovative
technologies, or adding other benefits to the local community, it is crucial to be
able to offer the type of local incentive that will “close the deal.”
Possible financial incentives include:
• Tax incentives
• Minnesota Tax-Free Work Zone
• RRI and other local grants
• EDA grants
• Grant writing assistance for new entrepreneurs and start-ups
-10-
It is critical that any tax incentive or business assistance be directed to accomplish the marketing objectives of the City of Grand Marais. Inducements will be
weighted to achieve the maximum effect on job creation and investment, quality
of business activity, and overall impact on the community. With this in mind, the
following is a list of qualities that will be carefully considered in determining levels
of abatement. Greater incentives will go to projects that:
• Qualify for local tax incentive policies
• Create high paying jobs
• Create large capital investment
• Create innovative and high tech. jobs
• Enhance existing local industries
• Do substantial business locally
• Contribute locally to schools, community, and other organizations
The Foreign Trade Zone (FTZ) is a federal program which provides tax benefits
for certain operations. This should be investigated to determine its applicability to
Cedar Grove and, if applicable, should be leveraged as an additional incentive.
Strategic Analysis
In the input stage of the planning cycle external assessments or audits are done to
develop a list of opportunities to seek out, and threats to avoid (David, 2007). It is
essential to determine the profitable and sustainable position of the Cedar Grove
Business Park against competitors in the geographic area. Analysis of the competing environment and strengthening competitive advantages is the way in which
local authorities establish their strategy for success (Shinno, Yoshioka, Marpaung,
& Hachiga, 2006).
When the conventional strengths, weaknesses, opportunities, and threats (SWOT)
analysis is used as a tool for external audits there is no means to identify the
importance of the SWOT factors analytically. It is, however, possible to quantify
relationships among SWOT factors by pair wise comparisons between the factors
and then analyzing them with the Eigen value method that is applied in the
Analytic Hierarchy Process (Shinno, Yoshioka, Marpaung, & Hachiga, 2006).
The external forces that must be evaluated regarding their possible impact on
an enterprise include economic, social, cultural, demographic, environmental,
political, governmental, legal, technological, and competitive forces. Performing
SWOT analysis on these forces will allow the city to track the changes in the forces
and the possible impact that they have on the sale of lots in Cedar Grove Business
Park. Looking at historical data it is possible to use the changes in the forces to
predict future events and at this point the predictions can be used to do strategic
positioning since external trends influence products, services and markets across
the globe (David, 2007).
Since modeling value chain or SWOT analysis is the core of strategic management,
the complex issues of strategic thinking are simplified into simple models. It is
possible to presume that strategic management replaced reality with hyper-reality
that verges towards simulacra (Grandy, & Mills, 2004).
-11-
Strategic Analysis
The Competitive Profile Matrix (CPM) is constructed by using internal and
external factors. The critical success factors that are used in CPM are broader than
the issues used in the External Factor Evaluation (EFE) and it can include some
internal issues. Creating a competitive profile of the Cedar Grove Business Park
against its major competitors allows for an easy to use summary of the particular
opportunities, strengths and threats of Cedar Grove and its competitors.
Analysis of past, present, and future objectives of the major competitors will
guide the strategic decision process to take advantage of the weaknesses of the
competition while promoting the strengths of Cedar Grove (David, 2007).
To populate the CPM the status quo of Cedar Grove is matched with the
Business Parks at Silver Bay and at Thunder Bay.
The most important critical success factor is Product Quality as indicated by a
weight of 0.50. The Cedar Grove Business Park however has a challenger for
product quality in Silver Bay Business Park. The lots in Silver Bay Business Park
are slightly cheaper and it is much closer to Duluth, therefore in easier reach of
logistical infrastructure. Cedar Grove has a serious challenge for price competitiveness since the lots in Silver Bay are about 15% cheaper per acre. The lots at Innova
Business Park in Thunder Bay are 11% more expensive than the lots in Cedar
Grove, but the infrastructure in Thunder Bay may be more attractive to new
entrepreneurs.
Internal Analysis
The Internal Factor Evaluation (IFE) for Cedar Grove Business Park was done by
using information gathered from the interview at Grand Marais. A market profile
analysis was performed for the people living in the Grand Marais ZIP code by
using the data bank of the U.S. Bureau of the Census, 2000 Census of Population
and Housing.
During the analysis six strengths and eight weaknesses were identified.
-12-
IFE Matrix for Grand Marais
The overall score of 2.48 is lower than an average score of 2.5 and this indicates that
Cedar Grove Business Park is slightly below average in its overall internal strength.
-13-
External Analysis
The methods and resources that were used to develop the External Factor
Evaluation (EFE) were the same as those used for the IFE.
EFE Matrix for Grand Marais
-14-
In the analysis six opportunities and five threats were identified. The overall
weighed score for Cedar Grove Business Park is 1.40. This is lower than the
average weighted score of 2.5 and that means that Cedar Grove is not in a
position to respond to existing opportunities and threats in the industry. The
score can however be improved and the authorities should look at T4, and T5 as
the two threats with the lowest weighted score that can be manipulated to some
extent to ameliorate these risks.
Stage Two - Matching Stage
In the matching stage analysis internal resources and skills are matched against
external opportunities and risks. This stage consists of six matching techniques
starting with the Strengths-Weaknesses-Opportunities-Threats Matrix (SWOT),
followed by the Strategic Position and Action Evaluation (SPACE) Matrix, the
Boston Consulting Group Matrix – (BCG) Matrix, the Internal-External Matrix –
(IE) Matrix, and the Grand Strategy Matrix – (GSM) Matrix. Each matrix has its
own particular outcome that will indicate the best possible strategy to formulate
(David, 2007).
Strengths-Weaknesses-Opportunities-Threats Matrix (SWOT)
The different strengths, weaknesses, opportunities, and threats were matched to
find possible solutions.
-15-
In the matching stage opportunities that should be pursued include O2 since it
incorporates the largest number of current strengths. Opportunities O1, and O3
are dependent upon outside funding and will happen irrespective of the business
park development, and O3 will benefit all the surrounding communities including
competitors at Silver Bay. The Airport development is a unique opportunity for
Grand Marais.
The principle weaknesses that need to be eliminated are the limited infrastructure
and lack of housing. Both of these weaknesses will be addressed with a growth
in population base. The possibility of developing more residential lots will also
alleviate the weakness.
Strategic Position and Action Evaluation
(SPACE) Matrix
The SPACE Matrix is developed by selecting a set of variables that define the
financial strength (FS), competitive advantage (CA), environmental stability (ES),
and industry strength (IS) for the Cedar Grove Business Park. Numerical values
are assigned to each group ranging from 1 (worst) to 6 (best) for those variables
that make up the FS and IS. The average score for FS, CA, IS, and ES is calculated
and plotted on the appropriate axis in the SPACE Matrix. The two x-axis scores
were then added and the resultant point was plotted on the x-axis. In the same
way the two y-axis scores were added and plotted on the y-axis. The vector was
drawn from the origin to this new point to reveal the strategy for the Business Park
of Grand Marais, MN (David, 2007).
SPACE Matrix
Conservative
FS
+6
Aggressive
+5
+4
+3
+2
+1
CA
-5
-4
-3
-2
-1
0
+1
-1
+2
+3
+4
-2
-3
-4
-5
Defensive
-6
ES
-16-
Competitive
+5
IS
A situation where a project is in the Defensive quadrant implies that the best
strategies will be retrenchment, divestiture and liquidation. Since none of these
strategies are really possible, the best way to deal with the situation is to limit the
costs and increase the benefits to the community. The IFE Matrix also indicates the
best possible strategy as Harvest or Divest. At this stage the City of Grand Marais
is in a position where they have an asset that has very strong competition from
other similar assets in the area.
Marketing Strategies
Cedar Grove Business Park is the right opportunity for a select group of entrepreneurs where the location benefits outweigh the logistical problems of the area
as well as the lack of infrastructure. It is of prime importance for the successful
marketing of the lots that these individuals become acquainted with the area and
the potential personal benefits associated with Grand Marais.
Without increasing awareness of Cedar Grove on a national scale, the park
simply cannot thrive. Awareness alone is of course insufficient to differentiate
Cedar Grove from any other business park; therefore specific differentiation
strategies necessarily need to be incorporated into the overall marketing strategy.
There are several viable strategies which will enable new prospective investors to
get acquainted with Cedar Grove that will leave a lasting positive impression with
a minimum of expenditures.
The current website for Cedar Grove is accessed through the Cook County,
Minnesota website. If one specifically includes “Cedar Grove” or “Grand Marais”
in online searches, it is relatively easy to find. However, Cedar Grove is not easy
to find in generic searches which attempt to find business parks throughout the
nation, or even specifically in Minnesota. As such, a standalone site specifically
designed to rank higher in specific key word searches should be created. This site
should also better highlight the attractiveness of Cedar Grove and incorporate
more content (text, pictures, and videos) which highlights the quality of life of the
surrounding area.
It is recommended that a personal presence be established at various trade shows,
trade fairs, and other expositions where potential prospects will likely be in
attendance. For example, a booth at the Marketplace for Entrepreneurs, in both
Minnesota and North Dakota, would be a very economical way to expose
Cedar Grove to a wide variety of entrepreneurs. Although the website and other
materials are necessary components of Cedar Grove’s overall promotional
strategy, the ability to interact personally with prospects will prove invaluable.
Major selling points of Cedar Grove are the quality of life, community, and other
intangibles which are best related through interpersonal communication.
-17-
Marketing Program
The strategies that will complement the marketing program will recognize the
product, the price, and the promotional components of the marketing mix. The
place (distribution) is fixed and therefore not applicable.
Product Strategy:
• Maintain Cedar Grove’s infrastructure.
• Make any necessary repairs/improvements as needed.
• Ensure compliance with various regulations.
Promotional Strategy:
•
•
•
•
Design new web site for search engine optimization.
Develop a strong web presence through online.
Proactively recruit at trade shows, trade fairs, and other expositions.
Utilize selective advertising to reach critical target markets.
Marketing Objectives
By October 2011:
•
•
•
Sell 5 additional lots to viable businesses at a reduced price.
Increase awareness of Cedar Grove through a presence at 4 trade shows.
Increase awareness of Cedar Grove through web site development with a
target of 1,000 hits, 300 click-throughs, and 3 conversions and links to the
various entrepreneurial sites like the Kauffman Foundation.
By October 2015:
•
•
•
Sell 20 additional lots to viable businesses at a reduced price.
Increase awareness of Cedar Grove through a presence at 24 trade shows.
Increase awareness of Cedar Grove through web site development with a
target of 7,500 hits, 1,800 click-throughs, and 12 conversions and links to the
various entrepreneurial sites like the Kauffman Foundation.
Proposed Marketing Channels
•
•
•
•
Website search optimization
Website promotion
Trade Show attendance
Optional advertising in;
o trade and industry journals,
o specific interest magazines (e.g. entrepreneurial magazines),
o radio in select markets
-18-
Marketing Budget
The development of a website specifically designed to promote the Cedar Grove
Business Park and recruit businesses is a critical component of this marketing
plan. It is estimated that with a $700 initial development investment followed by
recurring expenses of $500-$1,000+/year for updates, improvements, hosting, and
maintenance would be sufficient for the website to meet the objectives of this plan.
Trade shows vary greatly in registration, service, and travel costs. It is not uncommon for many shows to cost a total of $10,000 for participants. Registration alone
often can be $2,000. However, there are many trade shows that are far more affordable which would afford Cedar Grove great exposure to prospects. It is estimated
that with careful planning, trade show registration, travel, materials, and other
expenses may average $1,500-$5,000+ per show.
For example, a very economical expo in relatively close geographic proximity to
Grand Marais is the annual entrepreneurial-focused Marketplace of Ideas in Fargo,
ND approximately 370 miles away. Estimated expenses for a presence at this show
are as follows:
Low Cost Trade Show Expenses
Cost
Space
$195.00
Booth Expenses
$300.00
Travel
$200.00
Lodging
$250.00
Personnel
$400.00
Miscellaneous
$155.00
TOTAL
$1,500.00
Advertising costs vary greatly and should be analyzed on a case-by-case basis.
Advertising could provide Cedar Grove with a very attractive return on investment if it reaches the right target markets. It is critical that marketing research be
conducted prior to any advertising campaigns to ensure efficient targeting of likely
prospects.
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Summary
Cedar Grove has the potential to be differentiated from the competition. Currently,
prospects would probably not appreciate many of the intangible benefits of doing
business in Cedar Grove and the Grand Marais community without a personal
visit. Yet, there is little by way of the current marketing strategy to find prospects
and incent them to visit the park. Through implementation of the recommendations of a new and improved web site and trade show presentations, targeted
prospects will be encouraged to investigate Cedar Grove further where personal
selling can close the sale.
Another important aspect to consider is the establishment of a business incubator
somewhere in Grand Marais that will attract new entrepreneurs. A successful
venture in the incubator is a good motivator for obtaining financial resources
for further expansion. As these entrepreneurial ventures become successful,
transition to the Cedar Grove Business Park would be a natural progression.
Building the incubator in Cedar Grove will allow for its ultimate use as
permanent small business premises or possibly the beginning of a strip mall or
outlet. The funds to develop the business incubator should be acquired through
grants to limit the cost to the community, while allowing for immediate attraction
of new entrepreneurial ventures with a small positive revenue flow.
In short, the current marketing strategies are insufficient to significantly reach
beyond the limited word-of-mouth or local resident network that currently
exists. Granted, positive word-of-mouth is extremely effective, yet negative
word-of-mouth is far more destructive. Thus, word-of-mouth needs to be
strategically stimulated and managed through the marketing strategies
identified in the report.
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