Written: 27th June 2016
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What is Marketing Mix?
Marketing Mix is one of the most famous marketing concepts of all time. Commonly referred to as the 4Ps or 7Ps, the concept coaches businesses and marketers on how to target customers with an offering (product and/or service).
In 1958, Jerome McCarthy, a marketing professor at Michigan State University, coined the term 'marketing mix' to illustrate his 4Ps model. He explained that there were 4 criteria that customers use to make a decision on whether they will buy or not. The four criteria are Product, Price, Place, and Promotion. The concept was later expanded because of its limitation to product offering. Three new pillars were added during the dawn of service industry in the late 1970s. These include People, Process, and Physical Evidence. Thus, marketing mix becomes the 7Ps. |
Product
Every business starts with something that customers can purchase. Products include both tangible and intangible attributes. These include Starbucks Frappuccino, iPhone 6s, HSBC savings account, haircut, BBC website and a flight from London to Frankfurt.
The term 'product' now encompasses actual product, services, people, ideas, experiences, places, and a mixture of these. Businesses now provide a wide range of product to their customers. Apple Inc. sells gadgets such as iPhone, iPad and MacBook (product mix), and there are different versions of iPhone including iPhone 6, iPhone 5S, and iPhone 6C (product line).
What Customers Ask:
1. What is it?
2. How does it look like?
3. Is the right product for me?
4. How does it help me to solve my problem (i.e hunger, social needs)?
5. How do I use it?
6. How is it different from the competitors'?
7. What size, colour and style it has?
8. Is it appealing?
The term 'product' now encompasses actual product, services, people, ideas, experiences, places, and a mixture of these. Businesses now provide a wide range of product to their customers. Apple Inc. sells gadgets such as iPhone, iPad and MacBook (product mix), and there are different versions of iPhone including iPhone 6, iPhone 5S, and iPhone 6C (product line).
What Customers Ask:
1. What is it?
2. How does it look like?
3. Is the right product for me?
4. How does it help me to solve my problem (i.e hunger, social needs)?
5. How do I use it?
6. How is it different from the competitors'?
7. What size, colour and style it has?
8. Is it appealing?
Price
From a marketing perspective, price refers to the amount the customer has to pay or exchange for a product or service. In the past, price were set according to the production cost. But now price is intertwined with production, distribution, packaging, design, and branding.
Psychologists also discover that branding, economic situation and price change have a considerable effect on how people make decision on how much to pay and whether to pay at all.
Let's take a look at how economic situation influence price. In the UK, there are explosion of low-cost retailers including Aldi, Poundland, SportsDirect and TK Maxx. In 2008 economic recession, the consumer confidence level fell to its lowest level since 1992. The general public has been under austerity with massive cuts in public spending and pensions. The retailers mentioned earlier started to provide affordable alternatives to the British consumers. They can buy their favourite groceries such as Heinz sauce and Dove soap cheaper at Aldi than from the likes of Tesco. Also they can buy Polo Ralph Lauren shirts from TK Maxx outlet.
What Customers Ask:
1. How much does it cost?
2. Can I get this cheaper from somewhere else?
3. Is there any discount or promotion?
4. Am I getting a good value for this price?
Psychologists also discover that branding, economic situation and price change have a considerable effect on how people make decision on how much to pay and whether to pay at all.
Let's take a look at how economic situation influence price. In the UK, there are explosion of low-cost retailers including Aldi, Poundland, SportsDirect and TK Maxx. In 2008 economic recession, the consumer confidence level fell to its lowest level since 1992. The general public has been under austerity with massive cuts in public spending and pensions. The retailers mentioned earlier started to provide affordable alternatives to the British consumers. They can buy their favourite groceries such as Heinz sauce and Dove soap cheaper at Aldi than from the likes of Tesco. Also they can buy Polo Ralph Lauren shirts from TK Maxx outlet.
What Customers Ask:
1. How much does it cost?
2. Can I get this cheaper from somewhere else?
3. Is there any discount or promotion?
4. Am I getting a good value for this price?
Place
Place is about where and how customers can get a hold on a product and service. When customers decide to buy something, they will buy it from either bricks-and-mortar stores or online websites.
Depending on what type of products you are offerings, location heavily influences how customers make a decision. If a business is selling exclusive product such as limited edition Louis Vuitton handbag in Paris boutique store, then some people are willing to travel there to buy it. Whereas, if you want to drink an orange juice, then you gonna find it from any local convenient store.
What Customers Ask:
1. Where can I buy the product (and/or service)?
2. Is it hard for me to get there?
3. What kind of place is it (boutique store, supermarket, online website)?
4. Where can I get information on the product?
Depending on what type of products you are offerings, location heavily influences how customers make a decision. If a business is selling exclusive product such as limited edition Louis Vuitton handbag in Paris boutique store, then some people are willing to travel there to buy it. Whereas, if you want to drink an orange juice, then you gonna find it from any local convenient store.
What Customers Ask:
1. Where can I buy the product (and/or service)?
2. Is it hard for me to get there?
3. What kind of place is it (boutique store, supermarket, online website)?
4. Where can I get information on the product?
Promotion
The term 'promotion' can have different meanings. According to Baines (2014) promotion is the 'use of communications to persuade' the target audience to buy products and services. Communication can happen in a variety of ways such as mass media (tv), word-of-mouth, personal selling, and opinion leaders.
For example, a boutique hotel pays an influential travel blogger to write an article about the hotel. The article praises the hotel and encourages readers to experience the service there.
What Customers Ask:
1. Where do I get the message about the product (tv, pamphlets, Facebook ad, YouTube ad)?
2. When does the marketing message come?
3. Am I the one who should receive the marketing message?
For example, a boutique hotel pays an influential travel blogger to write an article about the hotel. The article praises the hotel and encourages readers to experience the service there.
What Customers Ask:
1. Where do I get the message about the product (tv, pamphlets, Facebook ad, YouTube ad)?
2. When does the marketing message come?
3. Am I the one who should receive the marketing message?
Marketing is about putting the right product in the right place, in the right price at the right time.
3Ps of Service Marketing
In this section, we will take a further dive in the service aspect of the Marketing Mix. As mentioned earlier, service industry creates new criteria that encourage customers to buy.
People
In service sector, people are inarguably crucial to the business. The importance of employee engagement with the customers is highlighted across many businesses. Employee are the first people whom the customers will encounter whether it's a store or call to the customer service.
What Customers Ask:
1. Who and where are they?
2. Are they trained to serve me?
3. Do they know what they have to do?
4. Are they gonna teach me how to buy a product?
1. Who and where are they?
2. Are they trained to serve me?
3. Do they know what they have to do?
4. Are they gonna teach me how to buy a product?
Physical Evidence
Physical evidence encapsulates any thing that customers can have a proof of existence of the business
Physical evidence does something intertwine with other pillars of the
What Customers Ask:
1. Is there any tangible proof that your service is real (i.e. name card, brochures, receipt)?
2. What is the atmosphere of the service that I will use (i.e. people, smell, tidiness)
Physical evidence does something intertwine with other pillars of the
What Customers Ask:
1. Is there any tangible proof that your service is real (i.e. name card, brochures, receipt)?
2. What is the atmosphere of the service that I will use (i.e. people, smell, tidiness)
Process
Process is a combination of 'tasks, schedules, activities, and routines' that allow people to use the service successfully (Baines, 2014). Businesses plans how their customers can use the service with minimised efforts and complications. Marketers and planners have the responsibility to inform the customers about what they have to do during the entire process. The aim is to avoid boredom and ensure that customers are actively engaged with the service.
In any services, customers are actually an important part of the service, because they have to do something whether it is waiting in queue or putting goods in a trolley. For example, you want to have a haircut at a salon. The salon requires customers to do the following:
1. Call to book appointment with a barber at least one day before
2. Come at least 10 minutes before appointment
3. Talk to the receptionist to confirm appointment
4. Wait on a sofa and being served complimentary drink
5. Go and wash hair by staff
6. Barber comes to cut your hair
7. Go and wash hair again
8. Staff dries your hair
9. Barber does final check and you can trim where you don't like
10. Pay at the reception
11. Leave the place
What Customers Ask:
1. What is the process like?
2. Is the process difficult?
3. How long is the process?
4. How long is the queue?
In any services, customers are actually an important part of the service, because they have to do something whether it is waiting in queue or putting goods in a trolley. For example, you want to have a haircut at a salon. The salon requires customers to do the following:
1. Call to book appointment with a barber at least one day before
2. Come at least 10 minutes before appointment
3. Talk to the receptionist to confirm appointment
4. Wait on a sofa and being served complimentary drink
5. Go and wash hair by staff
6. Barber comes to cut your hair
7. Go and wash hair again
8. Staff dries your hair
9. Barber does final check and you can trim where you don't like
10. Pay at the reception
11. Leave the place
What Customers Ask:
1. What is the process like?
2. Is the process difficult?
3. How long is the process?
4. How long is the queue?
Sources:
Linzmayer, O. (2006) Steve Jobs' Best Quotes Ever. Available at: http://archive.wired.com/gadgets/mac/commentary/cultofmac/2006/03/70512?currentPage=all
Virgin Group (2016) Richard Branson: Why business is about people, people and people. Available at: https://www.virgin.com/entrepreneur/richard-branson-why-business-is-about-people-people-and-people
Linzmayer, O. (2006) Steve Jobs' Best Quotes Ever. Available at: http://archive.wired.com/gadgets/mac/commentary/cultofmac/2006/03/70512?currentPage=all
Virgin Group (2016) Richard Branson: Why business is about people, people and people. Available at: https://www.virgin.com/entrepreneur/richard-branson-why-business-is-about-people-people-and-people
External Readings:
Baines, P. and Fill, C. (2014) Marketing. 3rd ed. Oxford: Oxford University Press
Keller, K. L. (2013) Strategic Brand Management: Building, Measuring, and Managing Brand Equity. 4th ed. London: Pearson.
Kotler, P. and Armstrong, G. (2013) Principles of Marketing. 6th European ed. London: Pearson.
Kotler, P. and Kevin, K. L. (2015) Marketing Management. 15th ed. London: Pearson
Available at:
www.amazon.com
www.kinokuniya.com
www.asiabooks.com
www.barnesandnoble.com
www.waterstones.com
Baines, P. and Fill, C. (2014) Marketing. 3rd ed. Oxford: Oxford University Press
Keller, K. L. (2013) Strategic Brand Management: Building, Measuring, and Managing Brand Equity. 4th ed. London: Pearson.
Kotler, P. and Armstrong, G. (2013) Principles of Marketing. 6th European ed. London: Pearson.
Kotler, P. and Kevin, K. L. (2015) Marketing Management. 15th ed. London: Pearson
Available at:
www.amazon.com
www.kinokuniya.com
www.asiabooks.com
www.barnesandnoble.com
www.waterstones.com
Copyright belongs to Bloomsbury Business Limited 2016
No parts of this publication can be copied and distributed on print or online medium without the consent of the company.
No parts of this publication can be copied and distributed on print or online medium without the consent of the company.