Marketing is about making potential customers aware of your products or services. And the Marketing Mix is how you balance your investments across different ways to achieve this.
As recently as 100 years ago, marketing was hardly practised and didn’t have a name. Yet now, with so much choice of things to buy, businesses need to get our attention and grab our interest. They need to find ways to create a market for goods that our great grand-parents couldn’t have conceived of, let alone needed. So what are the different strategies they can use to do this? That’s the Marketing Mix.
Why do we Need a Marketing Mix?
People only buy for two reasons:
- They need something, or
- They want something
And, if they don’t need your product, or they have a choice between it and someone else’s product, you’ve got to hope they want it. If not; no sales.
So it’s the job of marketing to make us aware of your goods and services, and to drive us to want them enough to exchange our money for them.
But there are different approaches a marketing professional or marketing department can take. In 1948, Harvard marketing professor, James Culliton, took this metaphor a step further, and described marketers as ‘mixers of ingredients’. It was his colleague, Professor Neil Borden, who started to use the term ‘Marketing Mix’.
But, you ask, what ingredients go into the marketing mix?
What is the Marketing Mix?
Before we look at the ingredients, let’s first define what we mean by the marketing mix in clear terms.
Definition of Marketing Mix
Marketing Mix is the set of marketing tools, actions, or tactics, that a company uses to get the response it wants, from the market.’
So, our next step is to understand what this set of tools, actions, and tactics is.
And the first articulation of note was made in 1960 by another marketing professor; this time at Notre Dame University. E. Jerome McCarthy put forward four components. Catchily, they each began with the letter P, and became known as the ‘Four Ps of Marketing’. And the 4Ps quickly caught on, because of the championing by marketing guru, Philip Kotler.
Jerome McCarthy’s 4 Ps of Marketing
So, the original Marketing Mix formulation was:
Product is the goods and services that you offer to your target customers.
At its purest, this is about the design solution and the quality standards your offering meets. Your product development process must take account of what consumers will want and need, and how to serve them, within a competitive time scale. You’ll also want to consider how you manage the product and in what quantities you sell it. What warranties or assurances do you offer alongside it?
Other aspects that McCarthy had in mind, like packaging and branding, now have their own P words, as we shall see later.
Price is how much the customer needs to pay for your product or service.
Usually, your goal is to reduce the cost to the consumer. Either you will drive down your cost or production, or accept smaller margins.
But price can also be used as a differentiator by raising it. This can raise the perceived value or quality of your offering; ‘reassuringly expensive’. Or it can create a cachet that makes it attractive to people who can afford it. They know others cannot, so price can confer exclusivity.
Place is where your customers can buy and access your product and service.
This is partly about the physical location, and nowadays, also about the channel:
- High street
These are choices that will suit some customers more than others.
Place necessarily also includes how your products get to where your customer accesses them; the distribution and logistics, or supply chain.
Promotion is the message and media you use to communicate with potential customers, to persuade them to buy.
That big pile of baked beans at the front of the supermarket, with a huge ‘2 for 1’ sign… that’s a promotion. So too is advertising, direct mail, competitions, and Public Relations.
As a marketer, there is a whole other thing: ‘Channel Mix’. What media to use, the different messages and how they are framed. The timing and frequency.
And then there were 7
It didn’t take long… We all love to do it.
Give me four Ps and I’ll find you more. The first to come were framed largely in the context of service industry marketing, in the 1980s. But they translate well in to other sectors too:
- Physical Evidence
Physical Evidence is how we reassure our customers about the value of our product.
So, this includes things like impressive offices, attractive retail experience, well-trained staff, great website. It’s clear why some references refer to this as Physical Environment:
But you also reassure your customers with the way your products and business look. So this P includes branding. It should also therefore include packaging but, as you have guessed, later in our story…
If the thesaurus had a word for branding that starts with a P, then it would doubtless sit in its own category!
Process is the means by which you deliver your service or product to your customer.
This is the flow of activities, the operational procedures, and the internal systems that get the product or service from idea to delivery. You may like our article on the Value Chain.
People are the humans in the mix.
And we know that people buy from people, so your staff and contractors are important. In particular, how they behave and present themselves, and how well they are trained to serve your customers. Customer service comes down to People implementing Processes. So, you need to be thinking about:
- Recruitment and retention
- Training and development
- Uniforms or dress-codes
- Handling enquiries and complaints
… and then 8
Oh yeah… We’re on a roll. In the service sector there is one more P that is important to buying decisions…
Performance is how well a service delivers on its promise.
Some writers refer to productivity here, but it’s easy to see that a service provider can deliver high levels of productivity and still under-perform. For a results-based service, performance is more important. And, frankly, who buys input based services these days?
…and then, even more
Oh pinch me. It’s not stopping…
Packaging is how your product or service is presented to your customers at the point of sale.
The trend should start to shift from appealing and and quality-implying packaging to low environmental impact solutions.
Positioning is how we frame our offer within our customers’ range of needs and potential solutions.
Which precise part of your market does your product serve, and how does it compare with competing products?
Politics is the means by which we confer status and commercial power on our products.
It is conducted through communications campaigns that include Promotions, but also hidden conversations among executives and owners.
Partners support our delivery to customers.
You need to manage existing partner relationships and build new ones.
We need to stop this now. But before we finish, let’s see how two authors tried to flip the idea on its head.
Turning the Tables (and swapping to 4Cs)
The four Ps, and many of the others as well, frame your marketing mix in terms of what you need to do. Two authors have tried to re-balance the approach by framing it in terms of the customer. And in so-doing, flipped from 4 Ps to 4 Cs.
First came Koichi Shimizu in 1973. He put forward a formulation of: Commodity, Cost, Communication, and Channel. Later, he expanded this to 7, adding Corporation, Consumer, and Circumstances.
Then came Robert Lauterborn in 1990. He chose a similar set, which he optimised for niche marketing: Consumer, Cost, Communication, and Convenience.
Space forbids us to look at either of these in detail, but suffice to say, we can do a direct comparison between each of these, and the original 4 Ps model.
What is Your experience of the Marketing Mix?
We’d love to hear your experiences, ideas, and questions. Please leave them in the comments below.
To learn more…
The Marketing Pocketbook is full of tips, techniques, and tools for everyone involved in the marketing process.
“A great primer for those interested in finding out more about marketing terminology, tools and techniques. With helpful updates on the impact of digital on marketing.”
Kerry Chapman, Regional Director – Industry Marketing UK & Europe Tata Consultancy Services