The 4Ps Of The Marketing Mix

The marketing mix is geared toward providing a business with a firm basis for success, but it's also very much about appealing to the sensibilities of current and potential customers; and if there is one thing, one simple fact, that all businesses should bear in mind when going about their day to day work its that it cost 10 times as much to attract new customers than it does to retain old ones.

Price:

Extremely straight forward, this is the value which is placed on the products being sold. There is a common misconception that setting your prices low will attract customers and setting your prices high will drive them away, and whilst this is the case with FMGs (fast moving goods), like bread and milk; it is not the case when it comes to luxury items or 'wants' as a high price is part of producing the image of a premium or exclusive brand.

A business's goals, aims and their overall marketing plan will have a big effect on price, as a good pricing strategy is one of the major driving forces behind a business, and can be used as a means of enticing customers away from rival competitors. It should be noted however that if a business tries too undercut everyone else, more often than not, it will lead to nothing more than that business going under; it is very much a balancing act.

Place:

Where an organisation is physically located and the ease of access to its points of sale are of immense importance, as the more convenient a product is to purchase, the easier it will sell. Think of it like two shops selling the same thing, on is on the high street, the other is down a little side street; the one on the high street will experience more footfall and will generate more sales through numbers alone.

One way in which businesses that are not conveniently located can combat this is by selling their products online via an e-commerce platform such as Amazon or eBay, both of which have the kind of footfall that no high street could ever possibly generate. The competition is higher, but not having an online presence is becoming extremely detrimental to businesses.

Product:

It is a fundamental fact that no business can exist without offering something in exchange for their customers money, but that is not all there is to it. A product is worthless if there is little or no demand, and a business is unsustainable if the product's it offers is too seasonal or subject to the whims of fashion and trends.

This is why good marketeers will pour a good deal of research into products before basing a business around the selling of them; and if they're creating new product then they will follow a rigorous New Product Development processes to determine the products viability. This process is comprised of 8 steps and consists of:

1. Idea generating
2. Idea Screening
3. Concept Development
4. Business Analysis
5. Product Development
6. Product Testing
7. Limited release
8. Full commercialisation

Generating new products is very important, as there are very few products that will remain popular and in demand for extended periods of time (these are known as “cash cows” and are very rare), most products, even successful ones, however will go through the product life cycle, which is:

1. Development – The aforementioned process
2. Introduction – Product is made available in the market
3. Growth – Sales gradually increase in number and frequency
4. Maturity – The product is well known and growth slows down but continues
5. Saturation – Growth stops and peaks, demand is steady
6. Decline – Frequency of sales drop
7. Obsolete – New, better products become available and sales drop to unsustainable levels

The products that a business offers is incredibly important, and is arguably the most crucial element of the marketing mix as no amount of advertisement or price reductions will help to sell and unwanted product.

Promotion:

In times past promotion was restricted to newspapers, billboards, radio and TV; but nowadays you have to be smart when choosing your promotional avenues. For example, if your business caters to younger generations then social media and text-advertising is going to reach more of your target audience than advertising on the radio or attending exhibitions will do.

Online promotion is a very strong means of promoting a business, as these days the majority of people will use the internet at least once a day , 25% of the UK work using computers, and you can receive accurate data regarding how many people your advertisement reached and was viewed by; something that a lot of other avenues cannot offer. Other potential avenues of promotion include:

• Flash-sales
• PR
• Seasonal sales
• Conferences
• Conventions
• Sponsorship
• Press releases
• Community events

Promotion, like place, is as much about where as it is about what, but as important as all the advertising avenues are, one of the greatest forms of promotion is word-of-mouth or referrals, as these come from individuals who are not connected to the business and have no stake in promoting it; which makes gives it more weight.