3rd Bac - Marketing Mix

 Marketing Mix

 

Understanding How to Position Your Market Offering

The 4Ps of marketing is a model for enhancing the components of your "marketing mix" – the way in which you take a new product or service to market. It helps you to define your marketing options in terms of price, product, promotion, and place so that your offering meets a specific customer need or demand.

What is marketing? The definition that many marketers learn as they start out in the industry is: putting the right product in the right place, at the right price, at the right time.

It's simple! You just need to create a product that a particular group of people want, put it on sale some place that those same people visit regularly, and price it at a level which matches the value they feel they get out of it; and do all that at a time they want to buy. Then you've got it made!

There's a lot of truth in this idea. However, a lot of hard work needs to go into finding out what customers want, and identifying where they do their shopping. Then you need to figure out how to produce the item at a price that represents value to them, and get it all to come together at the critical time.

But if you get just one element wrong, it can spell disaster. You could be left promoting a car with amazing fuel economy in a country where fuel is very cheap, or publishing a textbook after the start of the new school year, or selling an item at a price that's too high – or too low – to attract the people you're targeting.

The marketing mix is a good place to start when you are thinking through your plans for a product or service, and it helps you to avoid these kinds of mistakes. We'll discover more about the marketing mix and the 4Ps, and how you can use them to develop a successful marketing strategy.

 

The 4Ps are:

• Product (or Service).
• Place.
• Price.
• Promotion.

A good way to understand the 4Ps is by the questions that you need to ask to define your marketing mix. Here are some questions that will help you understand and define each of the four elements:

 

Product (or Service)

 

• What does the customer want from the product/service? What needs does it satisfy?
• What features does it have to meet these needs?
• Are there any features you've missed out?
• Are you including costly features that the customer won't actually use?
• How and where will the customer use it?
• What does it look like? How will customers experience it?
• What size(s), color(s), and so on, should it be?
• What is it to be called?
• How is it branded?
• How is it differentiated versus your competitors?
• What is the most it can cost to provide and still be sold sufficiently profitably? 

 

Place

 

• Where do buyers look for your product or service?
• If they look in a store, what kind? A specialist boutique or in a supermarket, or both? Or online? Or direct, via a catalog?
• How can you access the right distribution channels?
• Do you need to use a sales force? Or attend trade fairs? Or make online submissions? Or send samples to catalog companies?
• What do your competitors do, and how can you learn from that and/or differentiate?

 

Price

• What is the value of the product or service to the buyer?
• Are there established price points for products or services in this area?
• Is the customer price sensitive? Will a small decrease in price gain you extra market share? Or will a small increase be indiscernible, and so gain you extra profit margin?
• What discounts should be offered to trade customers, or to other specific segments of your market?
• How will your price compare with your competitors?

 

Promotion

 

• Where and when can you get your marketing messages across to your target market?
• Will you reach your audience by advertising online, in the press, on TV, on radio, or on billboards? By using direct marketing mailshots? Through PR? On the internet?
• When is the best time to promote? Is there seasonality in the market? Are there any wider environmental issues that suggest or dictate the timing of your market launch or subsequent promotions?
• How do your competitors do their promotions? And how does that influence your choice of promotional activity?                                                                                                                                   

4 ES

Experience

Exchange

Everyplace

Engagement

7 Ps

Physical evidence

People

Process

9 Ps

Philosophy - it is no longer sufficient to be a company with a product or service. You also often share your philosophies with the world. Menlo Innovations- often invites groups of people, even their competition, in for up to week-long sessions - to show off their philosophy for developing software via extreme agile project management and paired programming. Green energy firms - Accio Energy, eco-friendly cars - Smart Cars, and electric bikes - Current Motor Company - all have a 

Philosophy behind them. It is part of their company DNA, it is what they live and breathe at work.

Packaging - from traditional packaging to non-tactile packaging on the web for services or downloads, packaging your product or service becomes more and more important as the global market place is now your competition.

The 4 C’s of the marketing mix

The original and most fundamental of the “4 C’s” frameworks is the 4 C’s of the marketing mix (Lauterborn, 1990), which sets out four crucial factors which can determine whether or not the marketing of a product or brand is successful. These are as follows:

1. Customer wants and needs

What does the customer want or need that they are not currently getting, and what can we do to serve that need?

The first of the 4 C’s works on the logic that making a product or brand to cater for existing customer needs is a superior approach to simply making a product or brand, then identifying or manufacturing demand for them.

This theory lends itself to a specific order of planning and production. First, we use market research (e.g. sector-specific consumer surveys, or website data insights) to discover what the brand’s existing or prospective audience wants or needs. Then, and only then, can we plan, produce and market the solution.

2. Cost

What is the total cost of the product to the customer? In addition to the product’s retail price, this must factor in the time and effort required to get and use the product, plus any additional expenses that come with it.

Let’s consider how the cost-to-consumer of a video games console might break down:

Console retail price

Cost of games and accessories

Need to stay at home to take delivery of console/to visit video games store to collect

Setup time

Cost of online subscription

Cost of in-game purchases

As we can see, the true cost of the purchase is far greater and more complex than the price on the box.

3. Convenience

The third C is all about ensuring the brand/product is available as conveniently as possible to each customer persona/demographic in the target audience.

This is primarily a matter of understanding how a brand’s customers shop. If your target audience prefers to shop online, the item should be available to order online with flexible delivery options. Or, if they prefer to try in-store before they buy, that option should be available too.

“What’s the most convenient service we can afford to give customers, without causing business harm?”

This comes with the caveat that too-little convenience can also cause business harm, in the shape of lost custom.

4. Communication

How will the brand interact with customers? Advertising is an important part of this, but we must also consider other touchpoints such as social media messaging, in-store, automated marketing communication sequences and customer support helplines. Every interaction between the customer and the brand can affect customer satisfaction, the likelihood of future sales and the likelihood of customer referrals.