How well do you understand the marketing mix?
It’s something we normally learn about at school, but do we really understand its implementation?
The marketing mix is more than just something you should know exists. It’s something you should actively use in your marketing.
It’s not just useful for large enterprises either but can be used by smaller companies to improve their results too.
Want to learn how you can ensure you have the right product at the right price in the right place at the right time?
Marketing mix definition
The marketing mix is simply the things that a company or organization controls which influence a consumer’s buying decision.
In other words, it’s everything a company has control over which can convince you to buy a product.
The marketing mix is split up into the 4 P’s of marketing. There’s also an expanded version, the 7 P’s of marketing.
These both refer to the same thing, but the 7 P’s are a little more complete.
There’s also the 4 C’s of marketing (and the 5 C’s too!). These are all things we go into detail on in this post.
As we get further into the details, you’ll start to get a clearer sense of what the marketing mix is and how it can be used.
4 P’s in marketing
The 4 P’s in marketing are price, product, place, and promotion. Each of these 4 P’s have a big impact on your marketing performance.
When your 4 P’s are all working together, you’re more likely to see success in your marketing than when you haven’t considered all the different aspects.
We’ll cover each one in detail first, then move on to the expanded marketing mixes.
First in the marketing mix, is your product. This “P” refers to creating the right product for your target market.
Some of the things included in this “P” are:
- Product packaging
- Product design
- Technology used
- Warranties or guarantees
- The quality and value of your product
- Extras that come with your product
- Your products branding
- The right features on your product
There are many more examples, but this gives you an idea of what’s included in “products”.
Something that business owners often overlook is that your product needs to be right for the people you’re targeting. Often times, a product is made too general and loses its appeal to a specific market.
For example, if you’re targeting an audience in the outdoor space, you need your product to be durable and hardy.
If you try to create a packaging that makes it appeal to all walks of life, you’re going to lose credibility within your main market. The same goes for the products quality or the way it’s packaged.
If your product isn’t tailored to the right audience, it’s going to be difficult to sell.
Note: The word “product” sometimes confuses people. Whether you’re selling your time, selling a physical product or selling someone else’s product on commissions, you’re still selling a product.
If you’re a contractor who does plumbing and home repairs, then that is your “product”.
The next “P” of marketing is price. Pricing strategy raises a lot of debate in the marketing community.
There are many ways to price your product, some being more effective than others. This varies a lot depending on the kind of service that you sell.
Some of the pricing strategies you may consider are:
- Cost-plus pricing
This pricing strategy is simply adding your desired profit onto the production cost of a product. In the case of a services business, it’s just adding on the company’s profit on top of the hourly cost of the employees.
In a production company or factory, you just add your desired profit on top of the costs to manufacture a product.
In a lot of cases, extra margins are added to account for unexpected costs.
Cost-plus pricing is used a lot but it doesn’t account for the value your product delivers.
It’s one of the easiest forms of pricing but is less catered towards your target audience than some of the other options. This can lead to issues down the road.
- Competitive pricing
Competitive pricing is based on pricing your product or services competitively compared to your competitors. This ensures that clients get the best price when they buy from you.
This pricing strategy is mainly used when the product is well-known and “normal” prices have been established. It’s often used in large stores like supermarkets or e-commerce businesses like Amazon.
One of the big issues with this is that it can get out of hand. It often becomes a race to the bottom.
If it does then it can be hard for companies to compete. This leads to companies making pennies per product they sell.
It also makes it hard for new companies to enter the market, due to the large quantities that are often needed to make it profitable.
- Consumer-led pricing
In this pricing strategy, you use your market research to determine a price that your target audience is willing to pay. This makes it easy to ensure your target audience is happy.
This way of pricing clearly has its advantages, since it takes the end user into account. This ensures that your clients are kept happy.
If your target audience isn’t willing to pay more for the product than it costs you, the product will not perform well. Doing this research beforehand can be a lifesaver to startups.
- Premium pricing
Premium pricing is often used by high-end brands. Due to their branding and service, they are able to charge a premium for their product.
There has to be a reason for pricing your product at a premium though. An unbranded car will not suddenly sell for $500.000 if no reason is given for the elevated price tag.
This reason can be anything from a higher-quality or more feature-rich product, to a product’s branding.
Brands like Rolls Royce, Rolex, and Luis Vitton use this premium pricing strategy.
One issue that comes up with premium brands is that sales often hurt the brands value. This can result in a lot of wasted capital.
This pricing strategy also makes you vulnerable to counterfeiters. The more people wearing your product, the less valuable it becomes. This is more of a challenge to some companies (clothing for example) than for others (car brands).
There are many more pricing strategies than just these. I’ll make sure to do a post on this subject in the future!
The next of the 4 P’s of marketing, is place. Place stands for where your client can purchase your product or service.
The place you make your product available can be anywhere from distributors and physical stores, to online.
Placing your product in the right place is essential for your marketing to be successful. If you place your product in stores where your target audience doesn’t go, then you’re in for a rough journey.
Again, this sounds obvious when you put it this way. But what if we switch it around…
What if I asked you where your target audience is?
This is an extremely difficult question for most business owners to answer. It may seem obvious, but you’ll only know where the best place to sell your product is once you have tested everything.
Testing every single possible place isn’t doable of course, but the more you test the more you know!
This goes for both online channels as well as physical locations.
For example, say you’re a scuba diving instructor.
You may think the best place to sell your services is at stores selling scuba diving equipment.
However, there’s reason to believe that most people buying scuba diving equipment already know how to do it. They most likely have their permit too (if this is needed in your country).
Therefore, this isn’t placing your “product” in front of the right people.
Selling your services in industry-adjacent stores like surf shops or jet ski rentals may be more effective.
The placement of your product is vital to your marketing.
If your product is a terribly tasting soft drink, you’ll still be able to sell it in the desert.
The last of the 4 P’s, is promotion. Promotion includes anything you do to advertise and build awareness around your product.
Some examples of promotion might be:
- Direct sales on the phone
- Social media promotion
- (Digital) content marketing
These are the “standard” things that are thought of when it comes to promotion and marketing. Promotion can be very creative or can take very “standardized” forms. This all depends on the strategies that are implemented.
Sidenote: A lot of studies have been done proving that marketing campaigns which focus on multiple channels are more effective. This goes to show that not just the placement of your ads effects the results, but also the channels you choose to use.
7 P’s of marketing
The 7 P’s of marketing, also called the extended marketing mix, is an expanded version of the previous 4 P’s of marketing. These 7 P’s include the same four P’s, but have 3 more added on to them.
The first of the 3 extra P’s included in the extended marketing mix is people. This “P” is focussed on the people who aid in the selling and after-sale care.
This P includes things like customer service & sales agents and focusses on what people you need in place for your marketing to be a success.
It’s a part of the marketing mix that’s worth going over, but is less important for smaller companies than larger organizations.
It’s also less work for smaller companies which is a bonus!
The second of the 3 expanded P’s, is process. This P is focussed on the complete process, from a client’s first contact with your business, all the way through to the shipping methods and after-care.
Managing and optimizing these processes is an important factor in your marketing efforts.
This P is extremely important for larger organizations as their processes are often a lot more complex than that of smaller businesses. However, this doesn’t mean it’s not vital to smaller organizations too!
This is the last of the 7 P’s of marketing. Physical evidence focusses on the “proof” that your marketing is successful. Things like your business’s physical location, packaging and invoices are all things that are included in this P.
Things like awards and branded uniforms/vehicles can also be included in this P.
This P is mainly to do with your company’s presence and the effect it is having on its clients.
As you can see, all of these things are important parts of your marketing. There’s not one of the 4 P’s of marketing that isn’t vital to your overall marketing strategy.
The extended marketing mix is a more comprehensive summary of what your marketing consists of. Using the extended marketing mix will help you get even more laser-focused on what you need to do to make your business a success.
Marketing mix importance
The marketing mix is an important way for companies to determine what they need to do to market their business effectively.
It breaks down the different aspects of your marketing and makes it easier for you to determine what you need to do where. It also forces you to complete thorough market research and understand your target audience well.
The marketing mix is especially useful during strategic planning and will help make your marketing more effective.
Marketing mix example
For this example, we’ll use a furniture store that’s specialized in wooden chairs.
The product: High-quality luxury wooden chairs for homes and offices. (as you can see, parts of the market research can be added into the specification of each of the P’s in order to make it more specific.)
Price: Customer research has shown that the average price a customer is willing to pay for a chair is $150. This also happens to be the price that is reflected in our analysis of our competitor’s pricing.
Place: We sell our chairs in our own store, but we are also planning on working with smaller specialist furniture stores since we’ve seen that they share our target demographics.
Promotion: Our main promotion channels will be our website, which will be marketed using SEO, targeting keywords that are relevant to our target audience. As well as this, we’re going to run an ad in a high-end furniture magazine to help increase in-store visits.
As you can see, this is a very basic example of the 4 P’s being used. However, it does demonstrate how your marketing research and the 4 P’s work hand in hand.
The 4 C’s
The 4 C’s are a concept that rose out of the 4 P’s. It focusses on roughly the same aspects but focusses on the buyer’s point of view instead of the business’s point of view.
It’s often considered a more modern twist to the 4 P’s. It helps you to look at your marketing from a more customer-centric angle, instead of looking at what you want as a business.
The 4 C’s are:
Consumer wants and needs
This part focuses on providing value to your clients. If you’re not providing more value to your clients than you are asking from them in money, it’s going to be hard to get any traction.
This is going to differ a lot per client, as for some you are going to provide a lot of value, while for others it may not be worth it.
This is going to be one of the main things that your company is known for.
Are you a money-hungry business that extracts people’s money, or a business that people want to pay top dollar for?
Convenience is the counterpart of the “place” aspect of the 4 P’s. Convenience simply means that you want to make it as easy as possible for clients to purchase your product.
Also, making your product available in a place where it’s convenient and of the utmost value.
The more effort they have to put in, the harder it will be for them to buy and the less likely they are to buy.
Look at brands like Amazon who make it as easy as possible to purchase products and have them delivered straight to your door for no extra charge!
Cost goes hand in hand with consumer wants and needs. If you are charging more than the value of satisfying their wants and needs, then you’re going to have a hard time.
Instead of focusing on the price you’re going to charge, you focus on the cost that a client occurs when purchasing your product or service.
If the cost is less than what it’s worth to your client, they’ll be happy. If the cost is higher than what it’s worth, they won’t be happy or won’t even buy.
Bear in mind that a high-cost for 1 client is not the same as for another. This is why you always focus on your target audience when looking at the cost and leave your own opinion out of it.
This is the substitute for promotion and shows more of a customer-oriented focus. Instead of pushing your products down peoples throats you communicate with them.
There’s been a big switch in the way that companies market their products in the past few decades. It’s moved from a focus on outbound marketing to a focus on inbound marketing.
This is represented by the change from promotion to communication.
No, “conclusion” isn’t an addition to the 4 C’s… we’ve reached the end of this post on the marketing mix!
As you can see, the marketing mix is an important part of your marketing strategy. Whether you keep it old-school and go with the 4 P’s, or you go with the 4 C’s, it’s important to take each aspect into account when marketing your products, services or brand.
Are you going to implement the marketing mix into your marketing plan?