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What are the 4 Ps in Market Mix?
Definition: Marketing Mix
The Harvard Business Review defines marketing mix as, “the tool kit that marketers use to do their job, and it has four elements.” Marketing Mix combines four crucial pillars of any marketing strategy, which includes Product, Price, Place, and Promotion. Larger companies need to implement this concept, and, perhaps with a little more importance, the smaller companies need to do the same.
What are the 4 Ps in Marketing Mix?
The 4 Ps in Marketing Mix-Price, Promotion, Product and Place-to develop an effective marketing strategy was first introduced by Prof. E. Jerome McCarthy in 1960. Based on the industry and the target group for marketing, different approaches may be adopted to use each of these elements. Here, Product refers to the core offering, Price refers to how much the product will sell for, Place refers to the distribution process (online, offline), and Promotion refers to any form of marketing communication (advertising, selling, sales promotions, public relations, direct marketing, sponsorship) associated with the product.
Although, each of the elements in this marketing mix can be examined and understood independently, they are mostly dependent on each other. To ensure a strategic marketing plan, each of these elements are considered equally important.
Let us look at each of these elements in detail.
Product
A product is a good or service that is being offered or sold to a target audience. For example, if you walk into a shopping mart and each of the items that you see on the shelves are products. Also, when you visit a restaurant or a hotel or gym, you are availing a service which also qualifies as a product.
A successful product is that which fills the need in the market that is not being filled or the one that offers a unique experience to customers or consumers and creates a greater demand. Another example, when Coca Cola exited the Indian market in 1977, a lot of indigenous companies launched their cola brands (products) to fill the void in the market and create future demand as well.
Some of the important pointers regarding product are as follows −
What is your product?
Does your product meet an unfilled need or provide a novel experience?
Who is your target audience?
How is your product different from what others offer?
Price
Price is the cost at which a product or service is offered to the customers. Pricing can have a significant effect on the product, and thus it is important to price the products in such a way that is both accessible to the target customers and also manages to meet the business objectives. If a product’s price is high, there is a possibility that the target consumers may not purchase it.
Similarly, if a products price is too less, customers might consider the product to be of inferior quality and again desist from buying it.
For example, if we consider the mobile phones market in India, there are certain phone brands which sell their products at a higher price, making their brand a niche for a certain consumer group. There are other brands which offer more or less the same features, but at a much lower cost. These brands also have low buyers as people do not have enough trust on the products. The smarter brands are those who have priced their products in such way which doesn’t feel premium, nor does feel cheap, but manages to offer all the features the consumers look for. Phone brands like Xiaomi or Oppo (both Chinese brands but have a massive market in India) are classic examples of smart brands.
To price a product effectively, companies must have answers to the following questions −
What is the price range of competitors’ products?
What is the price range your target audience is looking for?
What price is too high for your audience? What price is too low?
What price best fits your target market?
Place
Place is the location (online and offline) where a product or service is sold. This is a very important factor as marketing is a lot dependent on getting the location right.
For example, a product that is aimed for a target consumer age group of 25-30, cannot possibly be sold at a location where people from this age group seldom visits. The same is true for online sales. A site where majority of the visitors are above the target age group, the product is unlikely to get sold there.
To decide the best place to sell a product, companies must conduct a thorough market research and then ponder over the following questions −
Where will you sell your product?
Where does your target audience shop?
What distribution channels are best to reach your target market?
Promotion
Promotion is how a product or service is advertised for. A right promotion is essential to create awareness and interest in the consumer’s mind for the product and this is possible only when the campaigns will resonate with the target audience.
Promotion of a product can be done through both a conventional method (print, TV, word of mouth etc.) and a digital campaign (social media marketing, e-mail marketing, etc.).
To get the promotional strategies right, companies must have answers to the following questions −
What is the best time to reach your target audience?
What marketing channels are most effective for your target audience?
What advertising approaches are most persuasive to your target audience?
Importance of Marketing Mix
It is important to use the 4Ps effectively and each should be adjusted in accordance with the market needs. Thus, a high-quality product meant for a luxury market cannot be offered with a heavy discount. This why most Apple products are offered with minimal or no discount, whereas several similar products offer heavy discounts.
The importance of marketing mix can be listed in the following points below −
Influencing demand in the market - A right mix of 4Ps will help counter competition and attract more consumers, thereby leading to more sales.
Resource Utilization - This involves utilizing every possible resource within an organisation and bringing in more efficiency. This is directly dependent on the need and help cut down the cost in a long run.
Effective Marketing - A proper analysis coupled with prioritization makes the decision-making process effective. Thus, the strategies are implemented correctly, and the company can focus better on the market needs.
Factors Affecting Marketing Mix
Marketing mix is affected or influenced by two main factors - Internal and External factors.
Internal factors include product planning, price, branding, personal selling, sales promotion, physical distribution, market research etc.
External factors include buying/trading behaviours, competitors, and governmental behaviour.
For example, a product’s marketing mix can get affected if the branding is not right. A recent example can be of a major online garment seller brand whose logo was found to be offensive by several women. We can also consider the noodles brand whose sales dropped after consumers stopped buying the product, fearing the presence of a certain harmful chemical in it.
Conclusion
Apart for the 4 Ps in marketing, there are also the 5 Cs which are basically guidelines that help to make correct decisions and construct a well-defined marketing strategy. The 5 Cs are Customer, Company, Competition, Collaborators, and Climate.
In some respects, the 5 Cs reflect many of the same concerns of the 4 Ps, but with added emphasis on external factors, such as possible outside collaborations and competitive research. Furthermore, while climate here refers to the social, political, and economic context surrounding the market, customer refers to the target market and customer experience. Meanwhile, Company refers to the place of the company and their available resources in the marketing process.
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