Embed Size (px)
Citation preview
Marketing: The Marketing Mix
Turn page to proceed
Marketing: The Marketing Mix
Contents
1. Marketing
2. Example
3. Target market, brand and targets
4. Product
5. Price
6. Place
7. Promotion
8. Sales
9. Other Ps
10. Consistent marketing mix
Marketing: The Marketing Mix
1. Marketing
“Marketing is getting someone who has a need to know, like and trust you.”
- Jon Jantsch
Understanding the marketing mix is essential if you want to understand marketing.
The mix consists of 4Ps, product, price, place and promotion, which together can
be mixed to get the right approach for your business. Approach it like a recipe for
business success.
Dependent on your target market, your branding and your product, you can
decide to emphasise or underplay the elements of the mix.
Marketing: The Marketing Mix
2. Example
As an example of the marketing mix at work, take perfume.
Broken down to its essentials, perfume is nothing more than water with a smell.
But the price that customers pay for perfume is many times the value of water
with a smell. Why? Because the marketing mix has been so well-crafted that the
customers’ image of perfume is that of an exclusive, special, luxurious, sensual
product – far removed from our crude description of it as “water with a smell”.
The image in customers’ minds is created with the building blocks of the
marketing mix: Price, product, place and promotion.
Product: The product is essentially water with a smell. However, customers see
something more than this, because perfume is sold in a sophisticated and
well-designed bottle, with expensive-looking packaging. Because it looks
expensive, customers begin to think that it is expensive.
Price: The cost price (excluding packaging) of perfume is perhaps less than
€1 per bottle. If it is sold for many times that, the customers’ perception
again changes. If it is expensive, it must be special.
Marketing: The Marketing Mix
Place: Perfume is not sold at every local shop but is only available from
expensive-looking retail shops that already have an up-market image.
This makes the product exclusive (or appear so). And again the customers’
perception of the product changes – if the product appears exclusive,
it must be so.
Promotion: Perfume is not sold by local leaflet drops or mass mailings, but is
promoted by elegant life-style advertisements on national television, Youtube
and in glossy, up-market magazines. Again, this changes customers’ perception
of the product.
By using the right combinations of the different elements in the marketing mix,
you can determine how customers perceive your product/service.
Marketing: The Marketing Mix
3. Target market, brand and targets
Before you decide on the marketing mix you need to define your target market,
your brand and your sales targets.
Who is your target market? Where are they? When, what, why, how?
Describe your brand?
In colours
As an animal
As a movie
As a song or music
As a book
As an actor or actress
Are you Elvis or Johny Depp as a brand? Why? How?
Marketing: The Marketing Mix
4. Product
What is the product? Go as wide and far as you can. From design to service to
packaging, warranties, after sales, choice, etc.
What is the core of the product? What else is there?
What problem are you solving? What is the appeal?
Is it a commodity or something special? What is unique about it?
Marketing: The Marketing Mix
5. Price
What are you charging? This is a tricky one as you have to consider how this fits
with the product, whether you are selling direct, indirect (every channel you use
to sell will take margin away), what discounts you are going to offer, what credit
policies you have, what terms of delivery, your cost base, etc. Your pricing
approach will impact on your profit and ultimately your survival and success.
Take a LONG time to think this through.
What is the cost price? What margin do you want? What is the break-even point?
What is the competition charging? How much could you charge? If you are using
resellers, what margin do they need?
Are you going for mass or is your approach much more targeted? What problem
are you solving? How much are you saving your clients? What is the emotional
value?
Test your pricing at markets, online, through direct sales and through indirect
sales.
Go back to your product. Does it still fit?
Marketing: The Marketing Mix
6. Place
In our view place is everything. The right product, at the right time for the right
customer. Moment marketing. It is the route to market, it is how you get in front
of your clients and it is how your product or service physically gets delivered.
Including online. It also includes inventory, storage, transport, etc.
How are your competitors getting in front of the customers? What is the most
direct route (=highest margin)? How much can you do online and digitally? Is the
focus local, national, international?
Do you need partners to sell? What is the best way to get in front of your
customers? How do you scale?
Does it fit with your product and price?
Marketing: The Marketing Mix
7. Promotion
Everything you do to get the attention of the customer and let clients know that
you are there. The list of activities under promotion is nearly endless. From PR
(we have a guide on that) to social media (we have a guide on that), from direct
selling to advertising, from tradeshows to business cards. And anything in
between. Point of purchase, events, radio, SMS, banner adds, SEO, pay per
click, loyalty cards, leaflets, brochures, etc.
Dependent on your budget, your target market, your product and the image you
want to project, some media will fit, others will not. All need to be consistent with
product, price and place.
What is your budget? What is the cost per sale? What is the lifetime value of
a client? How many people do you need to reach to get the sales you have
targeted?
Marketing: The Marketing Mix
8. Sales
The aim of the marketing mix is to achieve the sales you want. Product and
price are fairly static once you have decided your approach, the activity is in
the distribution and the promotion. We strongly suggest you make an activity
based plan part of your marketing mix, based on the sales you want to achieve.
What are you going to do next week, next month within particularly the
promotion mix to get the sales you need?
Marketing: The Marketing Mix
9. Other Ps
The 4Ps were developed in the 60s. Dependent on who you listen too, the number
of Ps in the mix have increased. 5, 7, 9 and in one case 44Ps.
Some are worth considering:
People: In a start up, the P of people or person is the key to success. The culture
you present can be a weapon you can use to compete. Where are you different?
How do you treat customers? What is your customer service?
Passion: The bigger the company the further removed from the core of the
business, which is passion. How much are you in love with your product or service?
Is that part of the mix?
Purpose: Why does your company exist? Is that part of the branding?
Philosophy: What are the guiding principles of your company? Are they different
than your competitors? Is it part of the brand?
Marketing: The Marketing Mix
Process: All the activities in the company are part of the brand experience.
Is there anything in your business model, you process and activities or the
technology that you use that can be used as part of the marketing mix?
Partnership: As a start up you have to box above your weight. One way to
achieve that is by partnering with other brands, organisations and/or people.
In all cases it should add to the brand and is therefore part of the marketing mix.
Physical: particularly relevant when you are selling service, which in its abstract is
not something you can touch. Which means that all physical manifestations of the
service are more important. The branding, the business card, the website, your
dress code, the office, signage, logo, etc.
We can go on a little bit longer. If you have a suggested “P”, let us know at
[email protected]. If it makes sense, we will add it to the guide.
Marketing: The Marketing Mix
10. Consistent marketing mix
A marketing mix must be consistent. Like in a jigsaw, it should all fit together. If
one part of the mix is out of sync, it will ultimately do damage to your brand and
your sales. The 4 Ps are deceptively simple as a concept, but are very tricky to put
together well. Every P has its own mix, so it becomes a mix of mixes. If you are a
cook you can see that this becomes a very tricky recipe.
The marketing mix cannot be designed in isolation. You need to be aware of
trends, technology, market conditions, competition and lots of other factors.
Hence the need for extensive market research, customer engagement before
you decide on the mix
With the arrival of social media it has become even more complex. With the
marketing mix you design a brand.
With social media you will immediately get the mirror of how well your project is
reflected in reality. Ultimately the brand will become the sum of the experiences
with your products, service and company. Hence the need for planning and
consistency. You can’t spoof this.
Marketing: The Marketing Mix
Get involved!
If you have any information that might be of help to other businesspeople
like yourself and it's suitable for inclusion here, please send it to
[email protected]. If we use it we’ll give you full credit.
Click to send Ron an email
