A marketing expert named E. Jerome McCarthy created the Marketing 4P's in the1960s. This classification has been used throughout the world. Business schools teach this concept in basic marketing classes.
The marketing 4Ps are also the foundation of the idea of
marketing mix..
You must
ensure to have the right type of product that is in demand for your market. So
during the product development phase, the marketer must do an extensive
research on the life cycle of the product that they are creating.
A
product has a certain life cycle that includes the growth phase, the maturity
phase, and the sales decline phase. It is important for marketers to reinvent
their products to stimulate more demand once it reaches the sales decline
phase.
Marketers
must also create the right product mix. It may be wise to expand your current
product mix by diversifying and increasing the depth of your product line.
All in
all, marketers must ask themselves the question “what can I do to offer a
better product to this group of people than my competitors”.
In
developing the right product, you have to answer the following questions:
Marketing Mix
Definition: Marketing Mix is a combination of marketing tools that a company
uses to satisfy their target customers and achieving organizational goals.
§ Product
§ Price
§ Place
§ Promotion
b
These four
elements are the basic components of a
marketing plan and are
collectively called 4 P’s of marketing. 4 P’s pertain more to physical
products than services. Below is an illustration for marketing mix
The Four Ps Model
Product – The first of the Four P's of marketing is product. A
product can be either a tangible good or an intangible service that fulfills a
need or want of consumers. Whether you sell custom pallets and wood products or
provide luxury accommodations, it’s imperative that you have a clear grasp of
exactly what your product is and what makes it unique before you can
successfully market it.
A product is an item that is built or produced
to satisfy the needs of a certain group of people. The product can be
intangible or tangible as it can be in the form of services or goods.
You must ensure to have the right type of
product that is in demand for your market. So during the product development
phase, the marketer must do an extensive research on the life cycle of the
product that they are creating.
A product has a certain life cycle that
includes the growth phase, the maturity phase, and the sales decline phase. It
is important for marketers to reinvent their products to stimulate more demand
once it reaches the sales decline phase.
Marketers must also create the right product
mix. It may be wise to expand your current product mix by diversifying and
increasing the depth of your product line.
All in all, marketers must ask themselves the
question “what can I do to offer a better product to this group of people than
my competitors”.
In developing the right product, you have to
answer the following questions:
- What does the client
want from the service or product?
- How will the customer
use it?
- Where will the client
use it?
- What features must the
product have to meet the client’s needs?
- Are there any necessary
features that you missed out?
- Are you creating
features that are not needed by the client?
- What’s the name of the
product?
- Does it have a catchy
name?
- What are the sizes or colours
available?
- How is the product
different from the products of your competitors?
- What does the product
look like?
Price – Once a
concrete understanding of the product offering is established we can start
making some pricing decisions. Price determinations will impact profit margins,
supply, demand and marketing strategy. Similar (in concept) products and brands
may need to be positioned differently based on varying price points, while
price elasticity considerations may influence our next two Ps.
It is also a
very important component of a marketing plan as it determines your firm’s
profit and survival. Adjusting the price of the product has a big impact on the
entire marketing strategy as well as greatly affecting the sales and demand of
the product.
This is inherently
a touchy area though. If a company is new to the market and has not made a name
for them yet, it is unlikely that your target market will be willing to pay a
high price.
Although they may be willing in the future to
hand over large sums of money, it is inevitably harder to get them to do so
during the birth of a business.
Pricing always help shape the perception of
your product in consumers eyes. Always remember that a low price usually means
an inferior good in the consumers eyes as they compare your good to a
competitor.
Consequently, prices too high will make the
costs outweigh the benefits in customers eyes, and they will therefore value
their money over your product. Be sure to examine competitors pricing and price
accordingly.
When setting the product price, marketers
should consider the perceived value that the product offers. There are three
major pricing strategies, and these are:
- Market penetration
pricing
- Market skimming pricing
- Neutral pricing
Here are some of the important questions that
you should ask yourself when you are setting the product price:
- How much did it cost
you to produce the product?
- What is the customers’
perceived product value?
- Do you think that the
slight price decrease could significantly increase your market share?
- Can the current price
of the product keep up with the price of the product’s competitors
Promotion – We’ve got a product and a price now it’s time to
promote it. Promotion looks at the many ways marketing agencies disseminate
relevant product information to consumers and differentiate a particular
product or service. Promotion includes elements like: advertising, public
relations, social media marketing, email marketing, search engine marketing,
video marketing and more. Each touch
Promotion is a very important component of
marketing as it can boost brand recognition and sales. Promotion is comprised
of various elements like:
- Sales Organization
- Public Relations
- Advertising
- Sales Promotion
Advertising typically covers communication methods
that are paid for like television advertisements, radio commercials, print
media, and internet advertisements. In contemporary times, there seems to be a
shift in focus offline to the online world.
Public relations, on the other hand, are
communications that are typically not paid for. This includes press releases,
exhibitions, sponsorship deals, seminars, conferences, and events.
Word of mouth is also a type of product
promotion. Word of mouth is an informal communication about the benefits of the
product by satisfied customers and ordinary individuals. The sales staff plays
a very important role in public relations and word of mouth.
It is important to not take this literally.
Word of mouth can also circulate on the internet. Harnessed effectively and it
has the potential to be one of the most valuable assets you have in boosting
your profits online. An extremely good example of this is online social media
and managing a firm’s online social media presence.
In creating an effective product promotion strategy,
you need to answer the following questions:
- How can you send
marketing messages to your potential buyers?
- When is the best time
to promote your product?
- Will you reach your
potential audience and buyers through television ads?
- Is it best to use the
social media in promoting the product?
- What is the promotion
strategy of your competitors?
·
point must be supported by a well-positioned
brand to truly maximize return on investment.
Place – Often
you will hear marketers saying that marketing is about putting the right
product, at the right price, at the right place, at the right time. It’s
critical then, to evaluate what the ideal locations are to convert potential
clients into actual clients. Today, even in situations where the actual
transaction doesn’t happen on the web, the initial place potential clients are
engaged and converted is online.
Placement or
distribution is a very important part of the product mix definition. You have
to position and distribute the product in a place that is accessible to
potential buyers.
·
This comes with a deep understanding of your
target market. Understand them inside out and you will discover the most
efficient positioning and distribution channels that directly speak with your
market.
There are many distribution strategies,
including:
- Intensive distribution
- Exclusive distribution
- Selective distribution
- Franchising
Here are some of the questions that you should
answer in developing your distribution strategy:
- Where do your clients look
for your service or product?
- What kind of stores do
potential clients go to? Do they shop in a mall, in a regular brick and
mortar store, in the supermarket, or online?
- How do you access the
different distribution channels?
- How is your
distribution strategy different from your competitors?
- Do you need a strong
sales force?
- Do you need to attend
trade fairs?
- Do you need to sell in
an online store?
Limitation
of Marketing Mix:
Marketing
mix (4 P’s) was more useful in early 19’s when
production concept was in and physical products were in larger proportion.
Today, with latest marketing concepts, marketing environment has become more integrated. So, in
order to extend the usefulness of marketing mix, some authors introduced a
fifth P and then seven P’s (People,Packaging,Process). But the foundation of Marketing
Mix still stands on the basic 4P’s.
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