Guest blog post by Jane Sandwood. Jane Sandwood is a professional freelance writer and editor with over 10 years’ experience. She decided to leave the corporate world and move into freelancing to take advantage of the flexibility and work-life balance it offers.
According to data collected by Hubspot, nearly 25% of marketers don’t know whether their efforts truly affect the outcome of a conversion. If you’re in this boat, the first thing you need to do is take a step back and analyze your overall marketing plan. Ask yourself:
- What’s working in terms of generating leads and sales? What isn’t?
- At which stage of the buyer’s journey is a certain tactic working? Where is it not?
- Who are your customers? What do you know about them that could help improve your marketing initiatives?
- How does all of this fit together?
When you’re able to determine the answer to these questions – especially the last one – you’ll be in a much better position to create an effective marketing mix. In turn, you’ll have a better understanding of whether or not a certain offer will resonate with a certain customer persona at a given time.
The Definition and Components of Marketing Mix
A marketing mix is the tools, strategies, and tactics a company uses to promote its products or services. When discussing marketing mix, we focus on all of the controllable elements of a marketing plan.
If you’re at all familiar with the term “marketing mix,” you’ve likely heard of the “Four P’s” of marketing.
While you may have seen the terms “marketing mix” and “Four P’s of marketing” be used interchangeably, it’s important to understand the two aren’t synonymous.
While “marketing mix” refers to the strategies and tactics implemented by a marketing team to promote its brand, the “Four P’s” refer to common factors that a team analyzes in order to develop these strategies.
The reason many people use the terms interchangeably is because, in his 1960 book Basic Marketing: A Managerial Approach, marketing wizard E. Jerome McCarthy proposed the “Four P’s” approach to marketing mix, which became the gold standard in terms of forming a marketing strategy for years to come.
However, in the early 1980s, Bernard H. Booms and Mary J. Bitner recognized that the “Four P’s” essentially ignored the fact that customer service is a huge part of any company’s marketing initiatives (even product-focused companies). In turn, they developed the “7P model” of the marketing mix.
An 8th “P” has also been added over time, which we’ll discuss momentarily.
Most recently, marketing experts have begun focusing heavily on the customer side of the marketing equation (rather than taking a brand-centric approach to marketing). This led to the development of the 4C model – again, which we’ll discuss later in this post.
The point, here, is that there are many elements to a marketing mix. Which ones a company chooses to focus on depends on the company’s overall marketing objectives, the products or services it offers, and the needs of its customers.
In the following sections, we’ll dig into the “P’s” and “C’s” of the marketing mix, and explain how analyzing each of them will contribute to a better understanding of how to reach your company’s marketing objectives.
The Four P’s of Marketing
In this section, we’ll define each of these terms in greater detail, discuss some of the questions you should ask yourself and considerations you should make regarding each one, and explain how popular brands have used each of these factors when developing a new offer.
Let’s get started.
.When developing your product or service, you need to consider:
- Whether or not there’s a need for it in the current marketplace
- Whether or not there will be a need for it in the future (or what you’ll need to do to adapt to future needs)
- The life cycle (growth, maturity, and decline) of similar products or services in the industry
When assessing the product or service you offer (or will offer) your customers, ask yourself the following questions:
- What do customers want?
- How, where, and when will they use it?
- What are the essential features of the product/service?
- What features are superfluous (either of your own product or of ca competitor’s)?
- What sets your product/service apart from your competitors’?
Understand the answers to these questions, and you’ll have a much better idea of where your product fits in with the current market. In turn, it will be much easier to showcase the value it can bring to your target customers’ lives.
Again, pretty straightforward – to be successful in any industry, you need to offer your products or services at a price that is affordable to your customers while also allowing you to maximize returns.
- How the pricing of your offer affects your profit margin
- The perceived value of your product or service
- Along with perceived value, your brand’s reputation throughout your industry
- The price of similar products being offered by your competition
In general, when determining the pricing of your products or services, you should ask yourself:
- How much does it cost to produce one unit or provide one instance of service?
- How much do you aim to make during a single exchange?
- How much do customers expect to pay for your product/service?
- Is your price hurting sales? Helping?
- Is your price hurting or helping your profit margin?
While everything about your marketing initiatives is, at one point, a matter of trial and error, this is most often the case when it comes to pricing. As mentioned earlier, you should always be prepared to assess the way you’re pricing your offerings to see if there’s room for improvement.
Place (Placement and Distribution)
Place refers to the logistics of where (and how) you actually deliver your product or service to your customers. In terms of distribution, there are three main strategies to choose from, depending on your customers’ preferences and needs:
- Intensive Distribution: Companies using this method of distribution attempt to get their products in front of as many eyes as possible, in a variety of places. For example, if you were in the mood for Coca Cola, you could head to any one of your local convenience stores, drug stores, or grocery stores to get a bottle or two.
- Selective Distribution: A company that offers more than one product (each of which varies in quality and price) might employ a selective distribution strategy. For example, a hardware company might partner with Walmart to sell its more basic, lower-end tools, and will partner with Home Depot to sell its more advanced, specialized wares.
- Exclusive Distribution: Exclusive distribution refers to instances in which a company’s product is onlyoffered at a specific store or location. For example, grocery stores such as Aldi, Whole Foods, and Trader Joe’s offer certain brands that can only be found at these respective stores. Companies that utilize exclusive distribution place high importance on building brand loyalty.
As with placement, distribution also takes into consideration how to provide a product in a way that’s most convenient for both the company and the consumer.
Promotion refers to any action, taken by a company or its customers, that gets the company’s name out in the public eye in a positive way. Such promotion can either be paid for in some way or another, or it can be organic.
Some of the most common forms of promotion are:
- Paid advertisements
- Public appearances and events
- Discounts, sales, and freebies
- Social media marketing and content marketing
- Referral marketing
When deciding on a promotion strategy, consider the following questions:
- What mediums do your target consumers use (especially when in “buying mode”)?
- When are they most likely to notice and come into contact with your promotion?
- How are your competitors promoting their products?
- What is your budget for creating and implementing these promotions?
Above all else, a successful marketing campaign is one that provides value to the consumer. This value might come in the form of a discount for frequent shoppers, or it might be a series of blog posts explaining how to get the best use out of your product. It all depends on what your customer is looking to get out of their engagement with your brand.
As mentioned earlier, the original Four P’s of marketing focused mainly on product-related marketing, and didn’t offer much in terms of best practices for marketing services.
Not only that, but even product-focused companies now tend to define their unique selling proposition based on the added services they provide (rather than just the features of their product).
Because of this, three new “P’s” (and a fourth) have been added to the marketing mix equation, which we’ll discuss in the following section.
The 7 P’s Of Marketing (And the 8th P, Too)
The four “new” P’s of Marketing, which focus more on the service side of things, are:
- Physical Evidence
There’s still one more to add, too…Let’s take a look at each of these categories in greater detail.
Simply put, without qualified, competent personnel working hard behind the scenes and on the floor, no company can succeed.
Processes refers to all of the actions that a company implements when delivering a service to its customers. Of course, this is a rather broad definition, as essentially everything a company does ultimately goes toward providing quality services to its customers. So, for our purposes, let’s discuss the processes in which customers are directly involved.
In thinking of processes in this way, we need to think of all of the touch points a customer experiences from the moment they walk into a storefront (or log on to a website, or contact a customer service helpline…) to the moment this engagement ends. A few questions to consider:
- How do your employees greet and assist your customers? Do they “assign” themselves to walk-ins, a la Apple Stores? Do they offer assistance if necessary, like most clothing stores? Or do they take a hands-off approach and make themselves available only if a customer seeks them out?
- How does the checkout process work? What payment options do you offer your customers? How about options for making returns?
- How does your company handle complaints? Is a manager always available during operating hours? Do you have a fully-staffed, on-site customer service department? Do you offer 24/7 support either by telephone or via email/social media?
In service industries, physical evidence refers to all the tangible parts of the otherwise intangible experience customers have when they engage with a company.
Physical evidence, in this regard, refers to three different aspects of a brand:
- Spatial layout
- Corporate branding
Ambience refers to the overall “feel” of the location in which a service is rendered.
Performance (Or Productivity and Quality)
Whether you call it Performance or Productivity, the 8th P of Marketing is all about how well your company operates – in the eyes of your customers – in comparison to all of the other companies in your industry.
Often, your company’s ability – and drive – to go the extra mile to ensure your customers’ satisfaction is the key differentiator that will keep them coming back whenever they’re in need of the services you offer. Performance is incredibly important in service related industries.
The 4 C’s of Marketing
As mentioned earlier in this post, the marketing world has, in the past few decades, undergone a shift in focus and philosophy.
Understanding this, in the early 1990s Robert F. Lauterborn developed the 4 C’s of Marketing as an updated version of the 4 P’s.
- Customer wants and needs (instead of Products)
- Cost of providing value (instead of Price)
- Convenience to buy (instead of Place)
- Communication (instead of Promotion)
To read the full article, click here.