Marketing Mix
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Marketing Mix
January 29, 2007
Marketing Mix
The “Marketing Mix” is a term used to describe the combination of tactics used by a business to achieve its objectives by marketing its products or services effectively to the customer. It is also known as the 4 Ps – Product, Price, Promotion, and Place. The marketing mix is also known as the 7 Ps, when you add people, process, and physical evidence to the first four.
The importance of the marketing mix is for businesses to make sure they are marketing-
The right product to
The right person at
The right price in
The right place and at
The right time (The Chartered Institute of Marketing,2004)
The mix of the 4 Ps, must reflect the wants and desires of the consumers in the target market.
Marketing is about identifying, anticipating and satisfying customer needs. This is so we can get the right product or service. When you have the product or service, ask the customer what they think of it. Ask them if they are satisfied with the quality and with any support services provided. The customer needs must be met.
When we follow-up on the products we should analyze the profitability of each product or service. Check and see which products/services make the biggest contribution or provide the highest profitability. Are support services being offered with some of the products?
Place is the means of distribution selected, depending on the type of product or service being marketed. The choice will impact on the pricing and promotion decisions. We need to ask ourselves, Are the customers for the products and services consumers or businesses? If they are consumers, we have three main options. First, are we selling to wholesalers who will sell to retail outlets who will sell on to the consumer? Second, are we selling direct to retail outlets or third, selling direct to the consumer? Place is a way of referring to the channel by which a product or service is sold (e.g. online vs. retail), which geographic region or industry, or to which segment of people it will be sold (Marketing, 2007).
If selling is done through wholesalers and retailers, we must remember when we price the products, they will each want their own mark-up to cover their overheads. You will also need to promote your products and services to all members of the channel. Wholesalers and retailers will have to be persuaded to stock the product and end customers to buy them. If you are selling to businesses you will have to cover the cost of a sales force. This can be very expensive and will again impact on your pricing.
Price generates profit, so it is an important element of the mix. You need to consider what your target group of customers will be prepared to pay for your product or services. It is important not to set the price too low, as customers may think there is something wrong with the product. Equally, you do not want to set the price too high; customers may think it is too high for the benefits.
Consider what it costs you to produce it. This will show you what you need to charge and not what you could or should charge. We must also make an allocation for costs such as selling, which are usually treated as fixed. Follow up on the competitors web sites, locations, or simply phone them and ask for a price list or quotation (The Chartered Institute of Marketing, 2004).
Promotion is made up of 5 elements: advertising, sales promotion, public relations, direct marketing, and personal selling. The combination of tools you use depends on the budget you make available, the message you are trying to communicate and the group of customers you are targeting.
Marketing has often been referred to as advertising. Marketing is a lot broader and advertising is just a part of it. What we are really talking about is consumer touch points, and the brand values and attributes that are communicated at each of them (Donation, 2004).
People employed at your organization will determine the quality of service your customers receive. This is truer for services, but also impacts on businesses making tangible products. Happy, skilled and motivated staffs make happy customers. You can obtain a competitive advantage over you competitors through offering a high level of pre-sales and after-sales support and advice. Again, this can impact on the price you set, as customers are likely t be prepared to pay more for the service they receive but there may be higher cost for you to take into account.
The processes involved in delivering your products and services to the customer have an impact on the way in which your customers perceive you. Look at all the processes involved in getting your products to the customer. Check and see if there are any delays, inform your customers of what is happening, and make sure your staff keeps their promises to the customers.
Physical Evidence is a term used to describe the type of image that your business portrays through its physical presence, namely its premises, the appearance of its staff, its vehicles, and even the set up with in the store.
I will use Target as an example to see how the marketing mix is used. Target is a large general merchandise discount store. It is able to attract all kinds of apparel shoppers, electronics, home dйcor, sporting goods, consumables, toys, as well as health and beauty products. So therefore, it is not just one product, but thousands of them. Each product grouping has its own set of buyers. By that, we mean, buyers who will determine what line will continue, what will be dropped and what will be brought in as new.
In store brands are offered at better savings than name brands. Sales tracking is done on new products as well as regular products to see where the demand is. If there was a high demand on any certain product, we check to see if it was due to special commercials or newspaper inserts. Observations are communicated by