The power of the marketing mix strategy – what is it and how can you use it?
One popular definition of marketing is that it is simply “putting the right product in the right place, at the right price, at the right time.” It is essentially the process of taking a product from manufacture through to market.
Research and focus is the name of the game when putting this definition to work in your own business. To ensure that your business is successful, it is vitally important to consider several different essential marketing fundamentals.
The individual marketing fundamentals working together is called the Marketing Mix.
The clever and strategic use of the marketing mix strategy is a dependable way to guarantee that the correct elements are featured in your marketing plans.
Marketing mix strategy is more relevant now than ever
The marketing mix strategy became a popular concept after an article was published by Neil Borden in 1964. “The Concept of the Marketing Mix” described how the author used a term from the 1940s. James Culliton opined that the marketing manager was a “mixer of ingredients”.
Borden listed product, planning, price, branding, distribution, display, packaging, advertising, promotions and personal selling as his essential ingredients. E. Jerome McCarthy then distilled them into a shortlist of the 4 P’s which are still much loved and well used by marketing managers today.
What is the marketing mix strategy?
It is a crucial marketing tool that uses the 4 P’s of marketing (recently expanded to seven) to confidently offer products or services to a customer base. Product, price, place and promotion are the four cornerstones of a successful marketing mix strategy.
When a business markets its products or services successfully, it is vital to apply the 4 Ps. The marketing manager will need to continually assess whether the company strategy features the right product, in the right place, at the right price and in the right way.
Before launching your first marketing campaign, take yourself through the Marketing Mix steps, detailed below.
By the end of this important process, you will have clarified key information about the most important aspects of the products and services your business offers.
Free advice from Ketchup Marketing
Alternatively, why not book a free 1-hour consultation with one of our lead marketing strategists here at Ketchup Marketing. At the end of this session, you’ll have a much clearer idea of the mix of marketing activities your business requires.
The 4 original Ps
1. Product
The product is either a tangible (a physical thing) or an intangible service, which meets a specific need. The term “product” encompasses all aspects of what your business offers – the design of the product, branding, packaging, sales and after-sales service.
All products follow a logical life cycle. Marketers should plan for each stage in the life cycle. For example, the marketing strategy for a start-up would be very different to the marketing strategy for a product which is well-established in the marketplace.
The benefits, features and the unique selling proposition must be understood.
Potential buyers must be identified for the product or services which your company offers as you need to know your customer, to ensure that their needs are being met and satisfied by your product offering.
Your marketing mix strategy must make your product stand out – there is little point in marketing your products in the same way as your competitors. Consider what makes your product better than the others on the market and why your clients should buy from your business. Identify the areas of differentiation.
Make sure you are well informed about your product and that you can answer questions competently. Your customers will feel comfortable buying from a business that knows their product offering inside and out.
Product checklist
- Assess the benefits and weaknesses of your product.
- Identify potential buyers and know your target market.
- Compare your product to competitors’ products. Identify areas of differentiation.
- Know where your product is in its lifecycle.
2. Price
Price is simply the monetary value attached to the product or service your business offers to the marketplace. Factors which commonly affect pricing are demand, availability of similar or substitute goods, consumer behaviour, production costs, distribution costs and normal trade practices (such as allowing discounts).
How a product is priced will have a direct impact on how it sells. A variety of pricing strategies can be effectively employed.
- Cost-plus pricing: add a mark-up to your total costs.
- Competitive pricing: choosing a price relative to your competitors.
- Value-based pricing: your customers’ perception of the value of your product determines the price.
- Price-skimming: a high price is set at the time of launching your product into the marketplace and is lowered as your product becomes established.
- Penetration pricing: a low price is set on entering a competitive market and is raised as your product becomes established.
What is the actual amount the end-user expects to pay for your product or service? This is a reflection of the customers’ perceived value of the product instead of an objective product costing. If a product is priced either higher or lower than its perceived value, it will be hard to sell.
Therefore, ask yourself if your product is reasonably priced? If it is viewed by your clients as too expensive, your sales will be low, and if you are not making enough profit as your product is too cheaply priced, you might sell many units but not have a viable business. Either way, your business will be in danger and it would be wise to research your clients’ opinions to assess what they think the acceptable price of your product is, before releasing it to market.
Price checklist
- Decide which pricing strategy you’d like to follow.
- Carry out a customer survey or focus group to establish if your product is priced correctly for the marketplace.
- Assess competitors’ product pricing in the marketplace and confirm that your product is reasonably priced in relation to similar offerings.
3. Place
Your product follows a route from production or manufacture through to the marketplace.
How will the product be provided to your customers? You need to place your product where your customers are and deciding where that is, can be a complicated choice. The priority is to make your products and services available to the right people (your client base) in the right place.
Careful thought needs to be applied to the appropriate location to sell your product. Will you offer it solely in an online, digital shop or will your customers want to purchase your product from a brick-and-mortar store? Should face-to-face sales suit your product offering better, will your customers prefer to purchase it from the grocery store or a high-end retailer?
You can choose to sell your product through direct or indirect distribution. Direct distribution involves selling directly to the end-user and indirect distribution refers to the use of an intermediary, like wholesalers, retailers or agents.
Distribution arrangements can be:
- Exclusive: using one specific retailer to sell your product.
- Selective: using some stores to sell your product.
- Intensive: using many stores to sell your product.
Thorough research will provide the correct answers and assist you in making choices which will help your business thrive.
Place checklist
- Decide whether to sell your product through direct or indirect distribution.
- Assess whether the digital space or the traditional brick-and-mortar store will suit your market better.
- Choose whether exclusive, selective or intensive distribution serves your product and customer base best.
4. Promotion
Marketing communication strategies are encompassed by the promotion label. Simply put, it is the channels and messages your business uses to communicate information about your product and offerings with your customers.
Advertising, sales promotions, special offers, public relations and publicity all fall under this category and are individually important parts of your marketing mix strategy. Ensure that the blend of communication strategies you select are suitable for your product and that the overarching message is appropriate for your audience.
Advertising is a paid-for message communicated to a mass audience. Publicity is news about a business or product which is spread freely by word of mouth. Consumers trust publicity in favour of advertising as it is deemed to have more credibility. Personal selling is the interaction which happens between the salesperson and the customer. Sales promotions include free product samples, discount coupons and buy-one-get-one-free special offers.
Regardless of where you choose to sell your products or services, promotion is an on-going necessity. Whether you choose to promote your business online or offline or a combination of both, make sure that you engage your audience with a carefully thought out campaign which encourages them to follow your call to action. The best marketing strategies clearly emphasise the benefits of their products and tell customers why they should buy this in favour of similar products in the marketplace.
Promotion checklist
- Assess your customer base (age, demographics, location) and choose the best promotional methods based on their specific and individual needs.
5. The additional P‘s
It has become accepted that the marketing mix has some limitations and impediments.
Lack of focus on services and lack of true customer focus are two criticisms which have been levelled at the traditional 4 P’s. Services are an intangible offering however the marketing for services can be planned for in the same manner as physical products.
The marketing mix was expanded to include the more P’s, which are all about service. The three vitally important variables are:
- People
- Process
- Physical evidence
People
The people who work for your company and provide a service to the consumer, often front line staff, play an integral role in the success of your business.
Employees negatively or positively impact the customers’ satisfaction levels and need to be well trained and motivated.
The staff represent the business and because consumers don’t separate the employee from the company, it becomes very important that your employees provide excellent customer service at all times.
Process
Processes encompass every step that happens from the moment the customer enters your business premises. All processes should be designed and implemented around their convenience and customer experience.
Issues such as wait time, staff helpfulness and friendliness, sales documentation and availability of electronic card machines are all examples of different steps in the process of the execution of a sale.
Physical evidence/physical proof/physical environment
Physical evidence gives the customer confidence in the ability of the business to carry out the transaction they desire.
The location and appearance of your business premises reinforce your good standing as a company and can reassure the customer that your business is reliable and trustworthy.
Complimentary customer reviews and testimonials help to establish your business as a leader in your industry or sector.
If you’d like to find out more about outsourced marketing services, give us a call on 0115 671 3868
But that’s not all…
The marketing mix is so-called as it is a seamless combination of varying elements which together make a business a success. Every element matters – product, price, place and promotion.
The four unique variables are interdependent and must be planned in conjunction so they work in alignment with each other.
The marketing mix should be a flexible tool for your business, which can easily achieve your specific goals. It is vitally important to observe and assess changing conditions in the marketplace, so adjustments can be made to your strategy to keep it relevant and current. Remember to increase and decrease variables as desired, to meet changing conditions in the marketplace.
The customer remains the focal point of all marketing activity and the overarching goal is to have a loyal and happy customer.
The discovery process
A powerful marketing strategy is informed by research. Before you can create your marketing strategy start with discovery. Find this essential information:
1. Define the Unique Selling Proposition (USP) of your product
- The priority for any marketing manager will be to define their product’s unique selling proposition.
- All further components of the marketing mix will flow from this clear picture of precisely what makes your product so special and unique.
- Identification can be helped through organised customer surveys or focus groups.
- The key features and benefits of your product should be rigorously assessed.
2. Understand the consumer
- Understanding who your customer is will mean that the product offering remains relevant and targeted.
- Once you know what your customers’ needs are, you can show them how your product benefits them and how the unique selling points can help to fill those needs and make their lives better.
- All the other components of the marketing mix will naturally grow from this clear definition of your consumer.
3. Understand the competition
- Your competitors’ products and related benefits and offerings around their product must be clearly understood to help your company set a realistic price point.
- At Ketchup, we offer free business tools that are designed to help you understand your place in the online market. Get in touch today and book a free SEO audit.
4. Evaluating placement options
- A thorough investigation will help the marketing manager understand where the customer is likely to purchase your product.
- To offer your product through multiple channels is wise as this will broaden your customer base and allow ease of access to your product.
And now the full complement can be used to develop your marketing mix strategy
- Outline your marketing objectives.
- Perform a SWOT analysis.
- Formulate your business marketing strategy using the 5 Ps. Now that the customer base and price points are clarified, the marketing strategy can be developed, planned and implemented.
- Implement your marketing strategy – put your detailed plans into action.
- Evaluate the marketing strategy. Assess whether all the interdependent elements relate to each other and function together. All four elements must work in harmony, as they rely on each other. Is the product a suitable quality for the desired marketplace? Is the price correct for your customer base? Do the chosen selling channels work in harmony with the perceived product value? Is the promotional material appropriate for your customers? You will need to continually monitor and alter your marketing strategy in response to changes in the marketplace.
Take a look at some of our case studies to see how we’ve successfully supported some of our clients.
The bigger picture
The marketing mix strategy is an essential and versatile tool that every marketing manager has at their disposal. All variables need to work harmoniously together to ensure a successful business. One element cannot be forgotten or neglected in favour of the others, without endangering the entire strategy. However once the mix is a perfect blend of all the essential ingredients, the only possible outcome is a product that is valued and sought after in the marketplace.
If you’d like to find out more about outsourced marketing services, give us a call on 0115 671 3868
