Marketing mix is a combination of marketing tools that are used to satisfy customers and company objectives. There are variables known as the marketing mix or the 4 P’s of marketing which is “Product”,”Price”,”Place (distribution)”, and “Promotion”. However, in recent times, the ‘four Ps’ have been expanded to the ‘seven Ps’ with the addition of ‘process’, ‘physical evidence’ and ‘people’. They are the variables that marketing managers can control in order to best satisfy customers in the target market.
- The product is the physical product or service offered to the consumer. In the case of physical products, it also refers to any services or conveniences that are part of the offering.
- Product decisions include aspects such as function, appearance, packaging, service, warranty, etc.
- Pricing decisions should take into account profit margins and the probable pricing response of competitors. Pricing includes not only the list price, but also discounts, financing, and other options such as leasing.
- Place (or placement) decisions are those associated with channels of distribution that serve as the means for getting the product to the target customers. The distribution system performs transactional, logistical, and facilitating functions.
- Distribution decisions include market coverage, channel member selection, logistics, and levels of service.
- Promotion decisions are those related to communicating and selling to potential consumers. Since these costs can be large in proportion to the product price, a break-even analysis should be performed when making promotion decisions. It is useful to know the value of a customer in order to determine whether additional customers are worth the cost of acquiring them.
- Promotion decisions involve advertising, public relations, media types, etc.
The following table summarizes the marketing mix decisions, including a list of some of the aspects of each of the 4Ps.
Robert F. Lauterborn proposed a four Cs classification in 1993. The Four Cs model is more consumer-oriented and attempts to better fit the movement from mass marketing to niche marketing.
- Product part of the Four Ps model is replaced by Consumer or Consumer Models, shifting the focus to satisfying the consumer needs. Another C replacement for Product is Capable. By defining offerings as individual capabilities that when combined and focused to a specific industry, creates a custom solution rather than pigeon-holing a customer into a product.
- Pricing is replaced by Cost reflecting the total cost of ownership. Many factors affect Cost, including but not limited to the customer’s cost to change or implement the new product or service and the customer’s cost for not selecting a competitor’s product or service.
- Promotions feature is replaced by Communication which represents a broader focus than simply Promotions. Communications can include advertising, public relations, personal selling, viral advertising, and any form of communication between the firm and the consumer.
- Placement is replaced by Convenience. With the rise of internet and hybrid models of purchasing, Place is becoming less relevant. Convenience takes into account the ease of buying the product, finding the product, finding information about the product, and several other factors.