In 1964, Professor Neil Borden of the Harvard Business School introduced the term “marketing mix,” which he defined as a related group of activities designed to influence buyer behavior. The mix consisted of what is generally referred to as the Four Ps: product, price, place and promotion. For years, the four have been viewed as the absolute gospel, but today, the changing times require the addition of two more Ps, planning and people, for a truly complete approach to marketing.
The Four Ps and Their Application
- Product. One of the keys to a product’s marketing success is its differentiation, but who and what make the product stand out? In an ideal environment, it takes input from buyers and sellers. Another critical factor related to product is the demand for rapid development of new products and services. The speed at which the marketplace functions requires companies to be fluid and flexible. In most industries, you can forget about a three- to six-year product development cycle or strategy unless you want to see the competition’s tail lights.
- Price. With price, the goal should be to attract buyers by creating the positive perception of worth. There are many factors to consider such as incentives, discounts and channel pricing. People don’t always buy the lowest price items, but they do expect value for their investment. Also, price needs to be viewed in conjunction with cost of products or services sold as well as breakeven points and profit goals. Increasingly, price is becoming a more strategic initiative that requires careful consideration and market testing.
- Place. Technology has radically altered the perception of place in the marketing mix thanks to online buying and servicing and its head-to-head fight with traditional bricks and mortar retailers. When the Four Ps concept was first developed, place meant distribution and all its related necessities such as supply chain, real estate, warehousing, inventory control, logistics, etc. While technology has increased efficiency for many companies, it has not changed the need for those basic requirements. For other companies, technology and creativity have allowed companies to flourish in new ways. For example, book stores have become coffee houses with live music performances creating an experience unavailable when ordering a novel or DVD online.
- Promotion. Advertising, public relations, sales and direct marketing have always focused on messages and mediums. More recently, companies use strategies such as “guerilla marketing” ─ a term coined by Jay Conrad Levinson ─ to encourage marketers to use unconventional methods of promotion by relying on time, energy and imagination instead of big budgets. And let’s not forget those ubiquitous blogs that can make or break a reputation or image in everything from products to politics. With promotion, the name of the game is test. Test the message, test the delivery mechanism and test the response.
Planning and People: The Two New Ps in the Marketing Mix
Many people think planning is already a part of marketing mix. Don’t we have to plan our marketing campaigns? Are we planning for a product upgrade this year? Aren’t we planning our distribution and supply chain? All of those are a part of planning, but the process literally and figuratively requires a global view.
Start with a well-crafted marketing plan. The plan is both a document and a process that provides a foundation with which to address the Four Ps in the marketing mix. It includes a brief recap of the company’s vision, mission and values to keep everyone focused on what’s important. A second section recaps the company’s positioning, branding and competitive analysis as overarching strategies for maintaining the character of the business in the marketplace. The marketing plan also lists quantifiable goals by product or service category.
Once goals are established, it’s time to look at budget, staffing, accountability and scheduling. Planning the creation of measurement and tracking systems along with the ability to modify them as needed is crucial here. Make sure to assign responsibility for programs and tactics to personnel, and then monitor progress. When necessary, make adjustments.
Of course, it takes people to make all of this happen, which brings us to the sixth and final P. “People” refers to more than just the marketing and sales teams. As a group, it includes all stakeholders who can offer input that may influence decision making in the marketplace. Among those are IT and administrative staff, personnel from public relations and other creative services agencies, vendors and suppliers and strategic alliance partners. Last but not least, don’t rule out adding customers to the people group. Their input could be substantial in assessing marketing mix effectiveness.
Marketing: Science or Art?
A truly effective marketing mix can be classified as both a science and art. The science is the methodology that develops the mix and its application. It is the scientific tracking of results, measurement of ROI, a reliable database and an accurate mechanism that gauges response. Art is effective decision making that results from refinement of the process through ongoing testing — the human element that makes sense of the science.
It is that same human element that is fundamental to adding people and planning to the Four Ps. No marketing strategy can be complete without comprehensive planning that includes accountability at all levels and a thorough understanding of the people who will impact, influence or execute it. Perhaps most important, adding people and planning to the marketing mix offers new outlets for controlling process variables through constant and consistent testing.
Marketing Tips
Crafting a marketing plan can be a long and arduous task or it can re-energize and excite those involved in creating and implementing it. Use these ideas when preparing, modifying or implementing a marketing plan.
- Give yourself and your team plenty of time to develop the plan. Rome wasn’t built in a day; your plan, no matter how short, shouldn’t be created that quickly either.
- This is not the time to take on the martyr role. Involve others in creating the plan, even if their roles are merely to provide feedback. Personnel from all parts of the company can provide crucial details and insights into the marketing plans, goals and opportunities.
- Ensure that the marketing plan is consistent with the business plan or vision statement.
- Include measurement strategies and implement them to understand how effective the implementation of the plan is in achieving the goals.
- Which is worse – implementing the right strategy at the wrong time or implementing the wrong strategy at the right time? Avoid both situations by determining the best time to implement each strategy in the marketing plan.
- Don’t hide that plan away in a file drawer! Circulate the plan throughout the company so everyone is informed about the plan. This will have the added benefit of helping employees feel committed to the company as they’ll understand where the company is heading and how they can help direct the company towards these goals.
Recommended Reading
There is a wealth of published information related to marketing and positioning. Here are a few of our favorites:
- Guerrilla Marketing: Easy and Inexpensive Strategies for Making Big Profits from Your Small Business, Jay Conrad Levinson
- Positioning: The Battle for Your Mind, Al Ries and Jack Trout
- The New Rules of Marketing and PR: How to Use News Releases, Blogs, Podcasting, Viral Marketing and Online Media to Reach Buyers Directly, David Meerman Scott
- The Tipping Point: How Little Things Can Make a Big Difference, Malcolm Gladwell
- Think Like Your Customer: A Winning Strategy to Maximize Sales by Understanding and Influencing How and Why Your Customers Buy, Bill Stinnett
Business Resources
Visit these websites for more information on marketing:
- Inc.com for entrepreneurial resources
- Salesvantage.com for a list of marketing agencies
- The American Marketing Association
- The-dma.org for resources on direct marketing
- Knowthis.com for marketing information and tools for business professionals, academics and students
Quarterly Quote
“Whether we know it or not, we’re all engaged in selling something – if not our wares, then our personalities, our services, our ideas. As a matter of fact, all human relationships are based upon selling of one kind or another, and we all engage in it whenever we undertake to persuade others to our way of thinking.”
–Claude Bristol