MARKETING MIX IN TRADITIONAL MARKETING
Marketing organizations around the world
have been using the traditional marketing mix to
develop, design and market products/services that
satisfy customers needs. The success of a product
in the market depends on a marketers ability to
mix the elements namely product, price, place,
promotion in the right proportion.
The way a product is priced should reflect the
value it delivers, keeping the competitors pricing
structure in mind. Promotion helps a company create
awareness and build recognition for itself and its
products in the target market through advertising, sales
promotion etc.,. A company can gain higher profits if it
can choose the right place in terms of distribution
channels like distributers, wholesalers, and retailers etc.,
to sell its products.
INADEQUACY OF FOUR Ps
The four traditional Ps of the marketing
mix- product, place, price and promotion are
adequate for marketing a product. However
they fail to cover the following aspect, which
differentiate products from services and are
therefore, important for services marketing.
o The product element involves only tangible
aspects and is therefore not appropriate for
services, which are basically intangible in
nature.
o A part of the promotion of the services usually
takes place at the time of consumption itself. This
is not so in the case of a product. In fact, the
people involved in service production handle the
promotion too in most cases.
o In the Indian scenario, the public sector
produced most of the services until very recently.
Very often still, the end consumer pays the
standardized and subsidized price, and this
aspect is ignored by the price mix.
o The dual role played by service customers as
co-producers and end consumers in the
production of service goes unnoticed by four
traditional Ps.
o The four traditional Ps fail to capture the
importance of distribution for services. In
most of the services, the production and
consumption takes place at the same time;
therefore, the distribution channel is either
absent or is very small.
o Further, consumers are unable to perceive
the quality standards of service before
consumption. On the other hand, marketers
are not able to identify and measure the
elements of the marketing mix that can
deliver quality service.
The above problem faced by
marketers have led to the addition of another
three Ps for marketing services, namely,
people, process management, and physical
evidence.
product
Marketers have identify three levels in developing
the product element of the marketing mix as far as services
are concerned. The ‘core’ level aims to satisfy the important
needs of the customer while the ‘tangible’ level manages the
appearance of the product. The ‘augmented’ level involves
the addition of supplementary services to the basic offering.
These three levels can be condensed into two, the
core level that caters to the basic benefits and a secondary
level which includes the tangible as the augmented service
levels.
The core level basically deals with service offering
while the secondary service level deals with the delivery of
service.
PricingThe pricing of services is very different from the pricing of goods
for various reasons. Service for example, can be differentiated
based on their price, as a higher price is generally associated
with better quality. The fixed cost is higher and the variable cost
is low in the case of service. Pricing of the same service can be
changed depending on the demand for the service. Though this
happens with some of the products which are seasonal.
Promotion Service providers should aim to promote their
service in order to eliminate the perceived risk.
This can be best achieved by encouraging and
promoting positive word-of-mouth publicity,
developing strong brands, offering a trial use
and finally by managing advertising and public
relation effectively to clearly communicate the
message to the customers.
PlacePlace relates to the ease in accessing the
service. Due to the inseparability of service, they are produced and consumed at the same place. This make its impossible for service providers to produce the service at a place where the cost are low and sell at a place where there is a high demand for it.
People Service organizations perceive people as a
means to gain a competitive advantage in the industry. Therefore they invest in attracting, training and relating the best talent.
Many service organizations involve their personnel
both at the point of frontline delivery and during the
production process that does not involve the final
consumer.
The service 0personnel have an important role in not
only designing the service, but also in delivering it.
Involve consumers as co-producers in designing the
service offering to suit their individual preferences. In
this case the service personnel play an important role
in helping the end consumer present his requirements
precisely.
ProcessThe production and delivery process in the
manufacturing sector is easier than in the service
sector. Marketers of service are often confused, as
there is little difference between marketing and
operations management in services. Customer
service encounters have an impact on the quality of
service delivered by the organisation. A service
encounter is the actual time period during which an
interaction take place between the service provider
and the customer.
over the years, some service organizations
have mechanized their service processes to
reduce the element of human judgment and
error in service delivery. For example, banks
has introduced ATMs to offer convenience to
customers and also reduce labor cost which
along with competition in the service industry
has increased tremendously.
Physical EvidenceService customers experience a great perceived
risk as they cannot rate a particular service until
it is consumed. Therefore they attach an element
of tangibility to their service offering. The
physical evidence can be in any form, for example,
brochures or TV commercials showing the detail
of holiday destination, pleasent and courteous
behavior of the service personnel in a bank, the
location and ambience of a food outlet etc.,