Nearly every business on the planet sets out with the main objective of earning money. This is generally done by producing some form of product, or offering a service, and then charging customers money for it.

First of all, it is a very rare case that a company can offer a product or service that is truly unique and cannot be supplied by anybody else. This means that your business will be contesting with other businesses that sell a similar item and you will both be trying to make money from the same shoppers, who only want to spend their money once.

Marketing is the primary tool used by modern firms to draw potential customers to do business with them and not with their rivals. It is a very extensive topic that is affected by a great number of internal and external variables, but when done right it can be the single business practice that could make or break a corporation.

So where should you begin when constructing a marketing strategy for your own business? Well, each situation is different, and each industry will have its own set of advantages and weaknesses that must be taken into consideration, but there is a marketing principle that can be applied to almost any company to be used as a marketing platform. It is known as the “Marketing Mix”.

The Marketing Mix

The marketing mix was a term that was first coined in the 1950’s and is an expression that is used to describe the fundamental building blocks of any marketing strategy. It demonstrates the fact that marketing is not a simple, blunt-edged business technique, but rather a delicate balance of different aspects of business operations. It got its name because it is similar to the ingredients list for a recipe.

The term was later built upon to include the idea of “four P’s” that described the critical elements of the marketing mix. The formalisation of these P’s made it very easy for business managers and marketers to swiftly relate the elements of marketing to the strengths of their own companies, and by doing so could very rapidly create a customised and efficient marketing system.

This marketing style is not limited to tangible goods, other services like conference production may gain via fresh marketing ideas or a new perspective.

Product

Although every aspect of the marketing mix is a requirement, the “product” element mentioned as one of the four P’s is perhaps the most crucial of all. It identifies the physical product or intangible service that your business will be selling, and at the end of the day it is the reason that buyers are going to spend money with you.

Many people don’t think that marketing has any place to play when it comes to the physical product that your company is selling. In fact, the typical train of thought very often bears the exact opposite sentiment. Surely it should be the other way around – your production department creates an item for sale and then it is the task of the marketing department to find ways to sell it, right?

Take the computer software market as an example. There are many well-known brands of both operating system as well as software application products on the market already, and since the market is relatively well saturated it would be incredibly tough (and expensive) to “take on the big boys”. So how can the principles of the marketing mix assist in this situation?

Rather than developing an operating system and then trying to craft a marketing strategy to rival the likes of Microsoft or Apple, it would be more effective to look at what sorts of product are desired in the current marketplace, and how viable it would be to produce and sell them.

Once your products have been fashioned and created it is still a critical skill to be able to objectively evaluate your own products to identify the reasons why a customer would buy your product rather than a competitors’.

A different form of this part of the marketing mix is known as product variation and is generally used to either lengthen the lifecycle of a product already in the market, or to make your new product attractive to as many customers as possible.

The motor industry uses this approach very effectively by offering various engines, trim packages and interior options with the cars that they sell. They use the marketing mix to great effect to sell their own goods in an extremely competitive marketplace.

As part of our own marketing strategy, our business very carefully studied what made our products stand out from the crowd.

“Product is paramount” is one of the main mottos applied within our event management business and aims to point out to all staff that we expect top quality manufacturing.

Price

Another key factor in the marketing mix concerns the price of your products or services. This isn’t a simple case of carrying out market research to figure out the highest price that your customers would pay (although that can be a handy tool to use), but rather making use of the price of your products as a strategic tool designed to achieve any particular objectives your company has.

Whilst it may seem obvious, it’s still worth noting that price has always been, and likely always will be, one of the key factors that shoppers take into account when they are making a purchase. It is also worth noting that customers don’t constantly consider the lowest price to be the best price. Actually a price that is too low can sometimes turn customers away.

There are many questions that you need to ask yourself when devising a good pricing strategy, key amongst which are the price sensitivity of your customers, what your competitors are doing and how can pricing maximise your own profits. From a strategy point of view however, pricing can be covered by two primary principals; price skimming and also penetration pricing. These are outlined below.

Price skimming

The principal idea behind price skimming is to make as much cash as possible from the segment of the market which is price-insensitive and will be willing to spend a large amount of money to receive a product or service early on. Not only can this technique yield great financial benefits, but it can also promote an exclusive and high quality image of your item.

This pricing technique is very often used in the consumer electronics industry where customers will often eagerly await the launch of a new mobile phone or computer games console. Manufacturers could set almost any price they wanted to and there would still be a loyal core of customers that would pay it.

Penetration pricing

Penetration pricing is at the other end of the pricing spectrum, and is geared towards gaining a large market share at a short-term cost so that financial benefits can be made long into the future. It can be a risky strategy, but when employed correctly it can create revenue streams for many years to come.

Another thing to bear in mind is that “price” is the only part of the marketing mix that will generate earnings for a business. The other members of the four P’s will all cost money to produce or undertake. So it is even more vital to get your pricing strategy right.

We were able to use our past marketplace analysis relating to toys robot to kick off the online key phrase optimisation we were doing.

Place

Place is the part of the marketing mix that is often disregarded by companies, but it’s still an important part of selling your product effectively. In short, it describes the way in which you deliver your product to your consumer, and subsequently how you receive money from them.

The most common ramifications of place-based marketing are the physical venues in which your products are sold. For the majority of consumer products, this includes the distribution infrastructure between your production plants and retailers or other outlets around the world. Since distribution of a physical product costs money it is important to determine your own priorities and modify your distribution network appropriately.

With the increasing use of the Internet by your prospective customers, marketing methods have had to take into account how they use the Internet to help deliver their products. By using the Internet as a point of contact (or even as a whole distribution route in download-based markets such as MP3s) companies are now able to reach out to a large pool of possible customers.

Promotion

When you mention the word “marketing”, many people immediately think of the promotional side of the marketing mix, although as we have seen, this is only one branch of a more comprehensive system. Promotion can be used on a very individual basis or as a mass communication tool, and whilst it can be an expensive undertaking it is often an essential one.

Advertising is one of the most typical forms of promotion. Classically it would be done by posting on billboards, producing short clips for TV and radio or by physically distributing flyers or leaflets to potential customers. With the arrival of the information age we have seen a great increase in promotion via e-mail and the Internet, or simply as targeted advertising materials posted through your front door. The potential for individualised advertising has never been so great.

Another significant part of promotion involves branding, which may not necessarily yield more sales directly, but goes back to one of the preliminary functions of marketing; getting customers to choose your product over those of your rivals. When all other parts of the marketing mix are equal it can be branding that swings a customer’s decision.

Putting it into Practice

As previously mentioned every business is different and will have different marketing needs. By using a mixture of the four P’s discussed above you can take an effective view of your own marketing plan.