The Marketing Mix

Nearly every business on the planet sets out with the primary objective of earning money. This is usually done by producing some form of product, or offering a service, and then charging people money for it. This fundamental principle is fairly straight-forward, though it contains many specific details.

First of all, it is a very rare case where a business can offer a product or service that is genuinely unique and cannot be supplied by anyone else. This means that your enterprise will be competing with other businesses that sell a similar item and you will both be trying to make money from the same shoppers, who only want to spend their cash once.

Marketing is the main tool used by modern businesses to draw prospective customers to do business with them and not with their rivals. It is a very extensive topic that is affected by a great number of internal and external variables, but when done well it can be the one business practice that could make or break a corporation. Any time spent on marketing will reap rewards, although spending this time correctly can yield extraordinary results.

So where should you start when constructing a marketing strategy for your own business? Well, each situation is different, and each industry will have its own set of strengths and weak points that must be taken into consideration, but there is a marketing principle that can be applied to almost any corporation to be used as a marketing platform.

The Marketing Mix

The marketing mix was a phrase that was first coined during the 1950’s and is a phrase that is used to describe the fundamental building blocks of any marketing system. It demonstrates the fact that marketing is not a straightforward, blunt-edged business technique, but rather a subtle balance of different elements of business functions. It got its name since it is similar to the ingredients list for a recipe.

The term was later developed to include the concept of “four P’s” that described the critical elements of the marketing mix. The formalisation of these P’s made it very easy for company managers and marketers to swiftly associate the elements of marketing to the strengths of their own companies, and by doing so could very rapidly form a tailored and efficient marketing strategy.

This marketing model is not restricted to tangible goods, other services like floor painting may gain from fresh marketing ideas or a new perspective.

Product

Whilst every aspect of the marketing mix is a requirement, the “product” element mentioned as one of the four P’s is possibly the most crucial of all. It identifies the physical product or intangible service that your business will be selling, and at the end of the day it is the reason that customers are going to spend money with you.

Many people do not think that marketing has any role to play when it comes to the actual product that your company is selling. In fact, the typical train of thought very often bears the precise opposite sentiment. Surely it should be the opposite way around - your production department creates an item for sale and then it is the job of the marketing department to discover ways to sell it, right? This is not necessarily the case.

Consider the computer software market as an example. There are many well-known brands of both operating system as well as software application solutions on the marketplace already, and since the market is fairly well saturated it would be incredibly tough (and expensive) to “take on the big boys”.

Rather than creating an operating system and then trying to craft a marketing strategy to rival the likes of Microsoft or Apple, it would be more effective to look at what sorts of product are sought after in the current marketplace, and how feasible it would be to produce and sell them.

Once your goods have been designed and created it is still a vital skill to be able to objectively evaluate your own products to recognise the reasons that a customer should buy your product rather than a competitors’. The technique is called product differentiation and forms one of the fundamental skills of the product part of the marketing mix cake.

Another form of this part of the marketing mix is called product variation and is typically used to either lengthen the lifecycle of a product currently in the market, or to make your new product attractive to as many consumers as possible. Again, this technique can be applied at all stages of product development.

The motor industry uses this approach very effectively by offering different engines, trim packages and interior options with the cars that they offer. They use the marketing mix to good effect to sell their own goods in an extremely competitive marketplace. Whilst these companies may have huge marketing budgets, the same principles can be applied to all businesses.

It might seem evident that marketing is incredibly significant for a physics text books producer such as ours, although particular ideas still must be put into practice, which isn’t always easy.

Price

Another important factor in the marketing mix concerns the price of your products or services. This is not a simple case of performing market research to figure out the highest price that your customers would pay (although that can be a useful tool to use), but rather making use of the price of your products as a strategic tool designed to achieve any specific objectives your business has.

Although it may seem obvious, it’s still worth noting that price has always been, and probably always will be, one of the key factors that shoppers take into account when they are making a purchase. It is also worth noting that customers do not always consider the cheapest price to be the best price.

There are many questions that you need to ask yourself while devising a good pricing plan, key amongst which are the price sensitivity of your customers, what your competitors are doing and how can pricing boost your own profits. From a strategy point of view though, pricing can be covered by two main principals; price skimming and penetration pricing.

Price skimming

The principal idea behind price skimming is to make as much money as possible from the sector of the market which is price-insensitive and will be willing to spend a large amount of money to get a product or service early on. Not only can this approach deliver excellent economic advantages, but it can also promote an exclusive and high quality image of your item.

This pricing technique is very often used in the consumer electronics industry where customers will often eagerly await the release of a new mobile phone or computer games console. Makers could set almost any price they wanted to and there would still be a loyal base of customers that would pay it.

Penetration pricing

Penetration pricing is at the opposite end of the pricing spectrum, and is tailored towards gaining a large market share at a short-term cost so that monetary benefits can be made long into the future. It can be a risky strategy, but when used correctly it can setup revenue streams for many years to come. When setting a price for penetration it is still important to not give a bad impression of your product by aiming for too low a figure.

Yet another thing to bear in mind is that “price” is the only part of the marketing mix that will generate income for a business. The other members of the four P’s will all cost money to create or carry out. So it is even more essential to get your pricing technique right.

We were able to make use of our previous marketplace analysis about lamb cooking to launch the on-line key phrase optimisation we were doing.

Place

Place is the component of the marketing mix that is often not addressed by companies, but it is still a significant part of selling your product effectively. In short, it describes the way in which you deliver your product to your consumer, and consequently how you receive money from them. It can be a great marketing technique when used correctly.

The most common ramifications of place-based marketing are the physical venues in which your products are sold. For the vast majority of consumer products, this involves the distribution infrastructure between your production centres and retailers and other outlets around the country. Since distribution of a physical product costs money it is important to determine your own priorities and adjust your distribution network accordingly.

With the growing use of the Internet by your potential customers, marketing methods have had to take into account how they use the Internet to help deliver their products. By using the Internet as a place of contact (or even as a whole distribution route in download-based markets such as MP3s) firms are now able to reach out to a large pool of possible customers.

Promotion

When you mention the word “marketing”, many people instantly think of the promotional side of the marketing mix, although as we have seen, this is merely one branch of a more complete system. Promotion can be used on a very individual basis or as a mass communication tool, and whilst it might be an expensive undertaking it is often an essential one.

Advertising is one of the most common forms of promotion. Classically it would be done by posting on billboards, creating short clips for TV and radio or by physically handing out flyers or leaflets to potential buyers. With the coming of the information age we have witnessed a great increase in promotion via e-mail and the Internet, or just as targeted advertising materials posted through your door. The potential for individualised advertising has never been so great.

Another important part of promotion involves branding, which will not necessarily yield more product sales directly, but goes back to one of the preliminary purposes of marketing; getting customers to pick your product over those of your rivals. When all other pieces of the marketing mix are equal it can be branding that swings a customer’s decision.

Putting it into Practice

As previously mentioned each company is different and will have different marketing requirements. By using a mixture of the four P’s reviewed above you can take an effective view of your own marketing strategy.