Marketig Mix

7/28/2019 Marketig Mix

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Pre Read: Marketing Mix

The term marketing mix was coined in an article written by Neil Borden called The Concept of

the Marketing Mix. He started teaching the term after he learned about it from an associate,James Culliton, who in 1948 described the role of the marketing manager as a " mixer of

ingredients"; The marketer, E. Jerome McCarthy, proposed a four Ps classification in 1960,

which has since been used by marketers throughout the world

The marketing mix is a business tool used in marketing products. The marketing mix is often

crucial when determining a product or brand's unique selling point (the unique quality that

differentiates a product from its competitors).

[A] 4 Ps of MarketingWhen marketing their products firms need to create a successful mix of:

The right product Sold at the right price In the right place Using the most suitable promotion.
http://cardinalsbusiness.com/wp-content/uploads/2012/03/marketing-4ps.jpg


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Marketing Mix is a combination of marketing tools that a company uses to satisfy their target

customers and achieving organizational goals. McCarthy classified all these marketing tools

under four broad categories:

Product

Price Place Promotion

These four elements are the basic components of a marketing plan and are collectively called 4

Ps of marketing. 4 Ps pertain more to physical products than services. Below is an illustration

for marketing mix.

1.ProductProduct is the actual offering by the company to its targeted customers which also includes valueadded stuff. Product may be tangible (goods) or intangible (services).

While formulating the marketing strategy, product decisions include:

What to offer?

Brand name Packaging Quality Appearance Functionality Accessories Installation After sale services Warranty

2.PricePrice includes the pricing strategy of the company for its products. How much customer should

pay for a product? Pricing strategy not only related to the profit margins but also helps in

finding target customers. Pricing decision also influence the choice of marketing channels. Pricedecisions include:

Pricing Strategy (Penetration, Skim, etc) List Price payment period Discounts Financing


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Credit termsUsing price as a weapon for rivals is as old as mankind. but its risky too. Consumers are often

sensitive for price, discounts and additional offers. Another aspect of pricing is that expensive

products are considered of good quality.

3.Place (Placement)It not only includes the place where the product is placed, all those activities performed by the

company to ensure the availability of the product tot he targeted customers. Availability of the

product at the right place, at the right time and in the right quantity is crucial in placement

decisions.

Placement decisions include: Placement Distribution channels Logistics Inventory Order processing Market coverage selection of channel members

4.PromotionPromotion includes all communication and selling activities to persuade future prospects to buy

the product. Promotion decisions include:

Advertising Media Types Message Budgets Sales promotion Personal selling Public relations Direct marketing

As these costs are huge as compared to product price, So its good to perform a break-even

analysis before allocating the budget. It helps in determining whether the new customers areworth of promotion cost or not.

It often takes time and requires market research to develop a successful marketing mix. You

should not depend on one mix always try new mixes. While designing the mix, make changes to

all mixes in such a way that all conveys the same message. Dont confuse your customers by just

changing one variable and keeping the rest same.


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Limitation of Marketing Mix

Marketing mix (4 Ps) was more useful in early 19s when production concept was in and

physical products were in larger proportion. Today, with latest marketing concepts, marketing

environment has become more integrated. So, in order to extend the usefulness of marketing

mix, some authors introduced a fifth P and then seven Ps (People, Packaging, Process). But thefoundation of Marketing Mix still stands on the basic 4Ps.

Example with respect to Maruti's SWIFT

Product: Initial launch version with basic features in Lxi/Vxi/Zxi formats

Price: At 4.84 lacs (on road Mumbai) much lower than other competitors in the B + segment.

Promotion: High decibel campaign kicked-off during the Football Worldcup 2006.The

campaign emphasized the curvy sports car hatchback design targeting sport lover youth

segment.

Place: Selective distribution initially based on order-booking only in select cities and only

through company dealerships. Dealers carry no inventory. Long delivery cycle time

[B] Extended Ps of marketing

Booms and Bitnerincluded three additional 'Ps' to accommodate trends towards a service or

knowledge based economy:

People

Physical

EvidenceProcess


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5.PeopleAll people who directly or indirectly influence the perceived value of the product or

service, including knowledge workers, employees, management and consumers.

6.ProcessProcedures, mechanisms and flow of activities which lead to an exchange of value.

7. Physical evidenceThe direct sensory experience of a product or service that allows a customer to measure

whether he or she has received value. Examples might include the way a customer is

treated by a staff member, or the length of time a customer has to wait, or a cover letter

from an insurance company, or the environment in which a product or service is

delivered

[C] 4 Cs of Marketing

Robert F. Lauterborn proposed a four Cs classification in 1993[5]which is more consumer-

oriented version of the four Ps that attempts to better fit the movement from mass marketing to

niche marketing:
http://en.wikipedia.org/wiki/Peoplehttp://en.wikipedia.org/wiki/Business_processhttp://en.wikipedia.org/wiki/Physical_evidencehttp://en.wikipedia.org/wiki/Marketing_mix#cite_note-4http://en.wikipedia.org/wiki/Marketing_mix#cite_note-4http://www.marketing91.com/alternate-marketing-mix-marketing/alternate-marketing-mix-2/http://en.wikipedia.org/wiki/Marketing_mix#cite_note-4http://en.wikipedia.org/wiki/Physical_evidencehttp://en.wikipedia.org/wiki/Business_processhttp://en.wikipedia.org/wiki/People


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The traditional Marketing mix is a 4 Ps model and is business oriented.The 4 Cs model of

marketing on the other hand is more consumer oriented. Because of its focus on consumers, the

4 Cs model is mainly used for Niche Marketing. However, just like the traditional marketing

mix, it can also be used for mass markets. The four variables in the 4 Cs model are

Consumer Cost Convenience Communication

Consumer The principle of four Cs of marketing states that your customer should be your

prime focus. Unlike the traditional marketing mix where the primary focus is on Products, in the

4 Cs model, the primary focus is on the customer. Thus the companies which follow this model

believe in making products which satisfy their customers. They are generally ready to offer

customizable products and because they have a general set of target customers, this principle is

only applicable for smaller market segments and not for mass markets. For mass markets, the

traditional marketing mix can be used.

Cost Cost is equivalent to Pricing in the traditional marketing mix. Cost is a very important

consideration during consumer decision making and hence in the 4 Cs principle, the cost

variable is given special attention. The 4 Cs model generally plans on the basis of Customers

and not products. And hence they have to plan the cost of the product on the basis of their

customer. If you are targeting a SEC A segment, then the costing of the product needs to be

premium to have proper psychological positioning. On the other hand, if your product is for the

SEC B and SEC C classes, then it needs to have a lower costing. Thus over here, costing of the

product depends on the customer.

Communication The concept of communication remains same for both, the traditionalmarketing mix as well as for the 4 Cs of marketing. Off course, the marketing communications

for a company following the 4 Cs of marketing is completely different as it needs a completely

different Segmentation, targeting and positioning. As said before, the 4 Cs of marketing are

generally used for Niche products. The media vehicles used for marketing communications for a

mass product and that for a niche product are different. A niche marketing company might use

more of BTL rather than ATL whereas in a mass marketing company, ATL communications

are very important.

Convenience Convenience is equivalent of distribution or placement of the traditional

marketing mix. When you have a niche customer base, the convenience of the customer in

acquiring your product plays a critical role. Take a niche product like Heavy machinery as anexample or even products like television and air conditioners. What if the companies who sell

these products do not give you delivery and installation. You will not buy the product as you

wont be ready to pick up the machine and install it yourself. You will be looking out for your own

convenience. Thus convinience, like distribution, plays a critical role. The customer will not buy

your product if it is not convenient to him.
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All in all, the traditional marketing mix model helps a company define its strategy more

efficiently. However, the 4 Cs model, although not much different, really helps if you are a

customer oriented firm.

[D] 4 As of Marketing

The 4 As of marketing has been coined by Prof. ProfJagdish Sheth, Rajendra Sisodia.

Acceptability, Affordability, Accessibility and Awareness. Taken together, these attributes are

called the "4As." The 4A framework derives from a customer-value perspective based on the

four distinct roles that customers play in the market: seekers, selectors, payers and users. For a

marketing campaign to succeed, it must achieve high marks on all four As, using a blend of

marketing and non-marketing resources.

The 4A framework helps companies create value for customers by identifying exactly what they

want and need, as well as by uncovering new wants and needs. (For example, none of us knewwe "needed" an iPad until Apple created it.) That means not only ensuring that customers are

aware of the product, but also ensuring that the product is affordable, accessible and acceptable

to them.

Awareness

Acceptability

Accessibility

Affordability
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[D] Comparison of 4 p, 4 c , 4 A and 4 os of

Marketing

Four Cs Four As Four Os Four Ps

Customer Needs:

Identifying customers'

problems and how the

company can solve

them by developing the

product.

Acceptability: The

product should be

socially and legally

accetable as well as

attractive and

fashionable.

Objects: The way the

product is

manufactured as well

as its level of quality.

Product

Cost to Customer:Determining the cost of

the product that the

customer will perceive

as fair.

Affordability: Theproduct should be

available at a price

that the customer can

affort to pay.

Objectives:

Considerations aboutthe revenue the

company should

generate and the price

at which this revenue

objective should be

met.

Price

Convenience: Making

the product available to

customers without theirhaving to make an

effort.

Accessibility: The

product should be

conveniently

accessible even forpeople with

disabilities.

Organization: Sale and

distribution of the

product; determiningthe destribution

methods to be used.

Place

Communication: Ways

the company will use to

get their message about

the product across to

the

customer.

Awareness: As many

people should know

about the product as

possible.

Operations:

Promotional

operations that most

suit the product, such

as telemarketing,

direct mail etc.

Promotion

Documents

Marketig Mix