Tuesday, June 7, 2011

Marketing mix definition

Dividing the multitude of marketing variables or mix into four distinct categories makes it much easier to formulate a marketing strategy. The four categories are (1) product, (2) place, (3) price, and (4) promotion, and are commonly called the “four p’s.” Note also that the client is not part of, but rather is the target of the marketing mix (Perreault, Jr. & McCarthy, 2004, p. 38).



Product

Armstrong and Kotler define product as “anything that can be offered to a market for attention, acquisition, use, or consumption and that might satisfy a want or need” (Armstrong & Kotler, 2005, p. 223). Most definitions are similar and it should be emphasized that a “product is not limited to finished goods” (Perreault, Jr. & McCarthy, 2004, p.38). All businesses, whether for profit or not have at least one product. Even government, by providing services and physical goods, has products.

When creating a marketing strategy, product development and its related aspects such as packaging, warranty, and branding must be considered. Analyzing and understanding client needs is important to remember along with the specific demographics the product aims to address.

As stated by Perreault, Jr. & McCarthy, clients are buying satisfaction not parts (2004). Many companies fail to remember what the client is really searching for. In the words of famous marketer Jay Abraham, “give them your solution – or somebody else will” (Abraham, 2005, p. 235). Abraham also goes on to note that clients do not buy products, they buy benefits and advantages (2005).

Many managers are myopic when thinking about product development, focusing on procedures instead of the client’s perception of the product. This myopia goes hand in hand with the other aspects of product development; branding, features, quality, and warranty. Managers tend to see the tactical aspects of the product, and a clear, client-driven product strategy guides managers beyond this narrow tactical view.

Place

Place includes marketing issues such as, channel type, exposure, transportation, distribution, and location. A product needs to be available to the client when and where the client wants it. Marketers describe this process as the “channel.” The channel describes “any series of firms (or individuals) that participate in the flow of products from producer to final user or consumer” (Perreault, Jr. & McCarthy, 2004, p.39). Services and business to business channels tend to have fewer partners, sometimes not any. The company may sell directly to the end-user. The internet has also shortened the channel in many businesses by effectively eliminating the need for intermediary partners that were historically needed. Other business types may require a large and complex distribution channel with multiple wholesalers. These tend to be big-box retail outlets and stores that purchase from both centralized jobbers and individual companies.

Price

Marketing plans must include price considerations. The pricing mix includes competition, cost, markups, discounts, and geography. Even if all the other aspects of the marketing mix are perfect, with the wrong price clients will not buy the product. The marketing plan must include consideration on how flexible prices are, lifecycle pricing, who gets discounts, and who pays transportation (Perreault, Jr. & McCarthy, 2004, p. 465).

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