The marketing mix is a set of marketing tools used by a company in activities to promote its products. It is also called a marketing mix. Integrated marketing is an important part of a business development strategy.
In today’s article you will learn what the marketing mix is, what it includes and what it does not include, what tasks it solves. Get acquainted with all the elements of the basic 4P model and learn about its differences from the expanded versions of 5P, 6P and 7P.
What is the marketing mix and what does it include?
The marketing mix is a working set of tactical decisions that define specific business steps. In simple terms, these are the tools needed to increase demand for a product.
The basic 4P model consists of the following elements:
- Product- functionality, quality, product appearance, packaging and brand. This also includes warranty, support and service.
- Price – cost, discounts, promotions, bonuses, terms and conditions of payment.
- Promotion – advertising and PR, direct sales, media and budget.
- Place – participants of the sales chain of the goods, market coverage, geography and sales locations, logistics.
The totality of these factors is used to meet the needs of potential buyers and improve the efficiency of the company. Thus sales – only a part of a complex of marketing. Implementation of full set of means of influence on the market will provide the desirable result. All its elements are connected with each other. Thus, the marketer manages the production of the product with specific consumer properties, determines the cost and place of sale, selects methods of delivery, informs the potential customer about the merits of the product and convinces to buy the product.
The goal of the marketing mix is to create a strategy to increase the value of the product for the target audience and achieve long-term revenue growth. Integrated marketing is indispensable in a highly competitive environment, because with the help of its elements you can create a competitive advantage. Sometimes even a small change in delivery terms or packaging design can lead a company to dramatic changes.
Here are a few examples of how marketing mix can affect business:
- Reducing the cost or arranging for free delivery will lead to more customers;
- Constant change and expansion of the lineup will encourage the CA to buy your products;
- implementation of a discount program will help build a loyal customer base;
- offer of additional goods/services will increase the average bill;
- Informing new customers in detail will reduce advertising costs.
The classical marketing mix includes product, price, place and promotion. The product gives an answer to the question “What properties should a product have, to meet the needs of the target audience? Price – “How to determine the price of the product and the level of profitability. Place – “How to build a competent sales model? Promotion – “How to distribute information about the product?
We proceed to a detailed analysis of each element.
This is the product or service that the firm offers. For example, a cheeseburger from McDonald’s or a delivery from point A to point B from a transportation company.
When using the 4P model, identify:
- What is your product better than others on the market?
- What need of the target audience does it meet?
- How can you change the product to make it more attractive and desirable?
Packaging is also part of your brand image, so it’s worth thinking about what to change in the design to make the product more marketable.
In the marketing mix, “product” includes:
- brand identity;
- The appearance of the product;
- quality level;
- customer service and support;
Simply put: It’s how you use the price of your products to affect sales. The clearest example of using price in marketing is Black Friday. A global sale is an opportunity to expand your customer base and increase revenue several times over in one day. In doing so, you can discount individual items and categories or all products.
The important thing to consider here is:
- advertising costs – add them to the cost of production, storage and shipping costs;
- profitability – so as not to sell at a loss, consider the margin of the goods and the average size of the discount;
- Demand – little-known brand should use 10-15 items in their promotional activities hooks to attract customers.
When putting together a marketing mix, it’s important to decide:
- Should prices be changed given the current market situation?
- Can we continue to sell products at their current cost (are they generating enough revenue)?
- Is the price of the product competitive?
Identify the following points in your strategy:
- launch pricing;
- pricing for different sales channels – for example, terms for wholesale customers;
- availability of seasonal discounts and promotions;
- retail value, taking into account the selling price;
- price level for simultaneous sales of a group of goods;
- peculiarities of promotions – their regularity and duration, the size of discounts.
The choice of location affects the accessibility of the product to potential customers. Aim for the product to be in the right place at the right time. That is, was there, where the target audience will see and buy it, when there is such a need.
Even the best coffee shop will close if it is in the wrong place. Take into account the proximity to consumers, the convenience of transportation, the presence of nearby competitors, etc.
When developing your 4Ps, answer yourself three questions:
- How can you make it easier to buy a product?
- Is it necessary to increase the number of outlets?
- Is it convenient for your target audience to shop at existing outlets?
Identify in the marketing mix:
- distribution channels;
- rules and conditions of display;
- type of distribution;
- logistics and inventory management;
- terms of sale.
Promotion is a way to attract attention to the product, to cause a desire to buy it. It is SEO, direct marketing, PR, promotions at the point of sale.
It is important to define:
- How to increase the effectiveness of promotion in the marketplace?
- Are there alternative ways of promotion?
- How else can the product be promoted?
In the marketing mix, “promotion” includes:
- Target values of loyalty, knowledge and consumption among the CA;
- The size of the marketing budget and the level of promotional activity of the product;
push or pull promotion strategy (in the first case, you stimulate intermediaries to buy, and in the second case, you stimulate end buyers);
- participation in specialized shows and exhibitions;
- geography of promotion (national, spot or mixed type of coverage);
- PR-strategy and event marketing;
- channels of communication with consumers;
- Promotions throughout the year and events to stimulate sales;
the company’s media strategy (where, how, when and at what price advertising should be placed).
At the same time, the basic model of the marketing mix does not include most of the internal marketing processes.
Evolution of the concept and the 5P, 6P and 7P model
Increased competition has led to the expansion of integrated marketing. The 4P model is universal, and new elements (Process, People and Physical Evidence) have become B2B and service market oriented. However, the improved versions can also be used for merchandise – this explains their popularity.
The additional “P’s” emphasize the internal components of marketing, emphasizing their connection to external strategy. Everything that happens internally has a direct bearing on the end result-increased revenue in the long run.
To identify these components, let’s take a closer look at Model 5, 6 and 7 P’s.
The basic concept of integrated marketing emerged in 1960, when firms were selling products rather than services. Later the situation changed, and customer service began to play an important role in the development of the brand. In 1987 marketers added a fifth element to the 4P – People. It is about customers, opinion leaders and staff.
Represents the 4P + Political Power + Public Opinion Formation formula. Political Power is Political Power and Public Opinion Formation is Public Opinion Formation.
Kotler, the creator of the 6P model, suggested that in order to survive in the international marketplace, you need the support of trade associations, regulators, and market-influencing audiences.
This is the basic model + People, Process and Physical Evidence. An expanded version appeared in 1981 because of the increasing complexity of the B2B segment and the development of the service market.
Evolution of the concept and models 5P, 6P and 7P
Let’s talk about all the additional components.
These are the people who can influence the perception of the product in the eyes of the target consumer. They include your employees and sales staff, opinion leaders, loyal customers and VIP customers.
At the “people” level, the marketing mix should work through:
- options for working with opinion leaders;
- programs for VIP-customers and loyal customers;
- educational programs for salespeople;
- a system of skills development and motivation for employees;
- ways to receive feedback.
This is the interaction between the brand and the target audience, which serves as the basis for making an order and creating loyalty. Your task is to make the use of a service or the purchase of a product as convenient as possible for the customer. All procedures/steps to “deliver” your offer to the target customer should be documented in the strategy.
A clear example of organization. Competently built process of interaction in McDonalds, thanks to which there was a competitive advantage of the brand – the speed of service.
The environment of the consumer at the moment of purchase allows to emphasize the key characteristics of a good/service and to form a positive image. In the strategy it is worth to write down the physical environment and its main objectives.
A striking example of the importance of Physical Evidence is the importance of the interior of an expensive restaurant or VIP-hotel.
Using the marketing mix allows you to make a strategy and a plan of its implementation in order to develop the product on the market and to find competitive advantages. This way you can increase the value of the product for consumers and get long-term stable profits.
All integrated marketing models are based on the 4Ps. Other elements can be added as needed: Process, Physical Evidence and People. However, instead of introducing new variables, it is usually more appropriate to focus on strengthening existing positions. Especially since some components of the marketing mix cannot always be controlled. We recommend that you focus your efforts primarily on meeting customer needs and solving their problems.