In the current climate of social media marketing, content marketing and search marketing it is often easy to lose site of the basics. Here at The Marketing Mix we agree looking forward is important; but sometimes it pays to look back as well. The marketing mix, also known as the four P’s is one of the longest running marketing theories in the industry.
Phillip Kotler first popularised the concept of defining marketing strategy along the lines of product, price, promotion and placement, way back in 1967; although Jerome McCarthy is credited with first introducing the concept in . Either way, it’s been around a long time for good reason. It is still one of the most highly effective strategic marketing tools available in your marketing strategy tool box. This guide aims to define ‘the marketing mix’ and give a brief education on how to apply the marketing mix to your business.
Why use The Marketing Mix – Keep the Focus on the Customers
The marketing mix is an integral tool for defining your brand or product offering. Remember; your brand only exists in your customers mind. As a marketer your job is to guide what your customers believe about your product. Without a clear product, price, promotion and placement strategy your communication is likely to be unclear; leaving the customer unclear about what your brand stands for, or worse ignoring your message. How can a customer know whether you offer the best price if you don’t know your pricing strategy? How can a customer know if you offer superior quality if you don’t know your product strategy? The marketing mix is a collection of decisions you need to make first so your ongoing messages are clear and concise.
Whether you are selling a simple tangible good such as a razor, or a complex intangible service such as a legal counsel, the important thing to remember is what your customers need, want or desire. Defining this creates customer value and thus defines your value proposition. This might seem deceptively simple but getting into the consumers mind and defining what problem you are solving takes some thought – but every successful company does this well. For example when Apple introduced the iPhone they didn’t focus on selling a phone with internet and touch screen capabilities. They were selling the ability to stay connected, do business and stay organized while on the go combined with an ease of use operating system making that meant smart phones were for everyone. This must be done for all business and product offerings if they are to get the most out of their marketing efforts.
Once the decision about the products benefit is decided, the other product decisions can be made to enhance the product offering message such as:
- Is your product the highest quality available in your market or do you offer reasonable quality but provide competitive prices?
- What additional features are there attached to the product offering?
- What about packaging design? How does this grab the consumer’s attention and create desire?
- What additional factors are we going to provide? After sales service, warranties and product support services?
If the product defines the benefits the customer receives then price determines the other major consideration when creating value. Remember; value for the customer equals the cost compared the benefit sought. Therefor the greater benefit you provide the higher price you charge. Having said that, it’s not always that simple. How you come to a fair price often involves a combination of factors including internal costs, level of demand, strategic goals and industry competition. Often small business rely more on gut instinct rather than analysis to come to price decisions. Even for larger businesses knowing what to charge can be complex. Either way having a clearly defined pricing strategy is key to communicating your message.
Now that you have your product and price strategies clarified you need to organise how to communicate your unique message. But how do you communicate your products benefits to potential consumers? Promotion covers exactly how you plan to communicate this information and what communication channels you will use. Often promotion is thought of only in terms of short term advertising, but it’s so much more than that. Promotion encompasses all methods of communication including public relations, publicity, personal selling, sales promotion and marketing strategies. Determining what method of promotion to choose comes down to a number of factors. Firstly, it’s important to consider where your customers go for information. This is where segmentation comes in handy to define exactly who your customers are. After budget considerations, competition factors and the overall marketing strategy must be taken into account to choose the most appropriate means of communication.
The final consideration is product distribution. Where are consumers going to find your product and how is your product going to arrive at its place of purchase? Often this channel involves the use of intermediaries such as wholesalers, retailers or agents. Understanding the motivation and potential conflicts between these intermediaries is an important issue to consider. Another issue to consider is the level of distribution. Maybe your focus is to have your product widely available so you select an intense distribution strategy. Or perhaps you have a small niche and wish to have a level of exclusivity for your product so you select only a handful of place where your product is available. Deciding where to place your product for sale is extremely important to your overall strategy.
Whether you’re a small business or large business defining your 4 P’s assists in getting the most out of your marketing efforts. Yes this takes time and effort to organise, but as marketers and small business owners it’s easy to get lost in chasing customers rather than analysing why customers choose you. The importance of taking a step back to look at the picture is sometimes forgotten amongst all the industry jargon. But don’t worry, The Marketing Mix are here to help.