For anyone who has taken an extensive amount of business courses at a university or is just curious about marketing, they’ve heard of the 4 P’s, or the marketing mix. The 4 P’s should be used in any marketing strategy that you or your company puts forward as it is a great guideline to follow from development through production and eventually sales. The 4 P’s tell us to focus our attention on Product, Price, Promotion and Place before, during and after the creation of a product or service that you are going to be providing for your customers. Why the 4 P’s though? Well simply, it’s useful and it would be a little funny if you asked your coworker, “Hey Jim, lets talk about the PPPP after lunch.”
I remember in my bachelor’s program we talked about the 4 P’s and how they would be applied, then in my MBA we applied the 4 P’s while discussing them in a little more depth and while in my doctorate our professor said, “I’ll piss on your 4 P’s and raise you three more.” and I was all like… shiiiizzz, that’s cool. Let’s build. But it does make sense because the other three have to do with product and brand building after sales and distribution which is a powerful thing. For a brand to grow in popularity and the product to keep bringing in more and more revenue, nothing beats word of mouth marketing and positive brand / product reviews.
You cannot build word of mouth marketing, it’s organic and you cannot sway customer reviews. This is free marketing that every company strives for. This is not to be confused with “free” in marketing or a free market. One of those is promotions and the other is economics. You need to get customer engagement if you want your company to grow. No one knew who you were before you started and no one will see the struggles if you don’t allow it. This is why the last three (of the original 4) of the P’s is so important.
Let’s delve in shall we…
Since we can’t call this the “three and a half P’s and half a S” we’ll refer to the first P as Product (or service). Essentially this is what you are selling to the customer too fulfill their wants and desires, or possibly solving a problem for them. The product can be a tangible good or intangible service that should be distinguishable from the market unless it is a generic. This is the most crucial step when forming your company and should be completely laid out and discussed thoroughly before deciding on the next three Ps.
The fun part of the marketing mix is by all means the pricing. How much do you want to sell your product for and what market you are targeting is all inclusive within the price. There are a lot of variables that go into pricing such as upfront investment, associated costs, production channels, ease of entry, economy pricing, psychology pricing, bundle pricing, premium pricing, penetration pricing and more… Pricing is important because it will have a lasting effect on revenue, profits and…
… promotion. Knowing your audience and your product is essential. A good promotion will use a mix of traditional marketing techniques and new age techniques such as digital marketing. Knowing where your audience shops, what they read and who they follow on social media can give you a leg up on the competition. Companies of all sizes are competing for your attention at all hours of the day. A common marketing paraphrase says that you compete against everyone and everything, even sleep.
Companies aren’t just competing for your attention, they’re also competing for space (or their place). Big box retail and especially grocery stores make money per square foot sold to sell products. E-marketers cannot sell if they cannot be found on your computer screen. Book, songs and movies can’t be seen if they can’t be downloaded and without a place for that they’ll never be enjoyed. After your company negotiates or finds their channels, how are you able to use them too find future customers?
So where did the other three P’s come from? Well the last of the three are more of a follow-up to the process that put the product on the shelf or gave way to the service provided. The people, the process and the physical evidence are all part of the product life cycle’s sustainability in the marketing place. But how do these final three elements tie into the larger marketing mix?
The people are those who are not only involved in decision making process, but are there along the way to help bring it all together. The larger the product the bigger the scale and the more channels that will be needed for proper operation. On the back end of production you’ll need to work within a supply channel to get all the necessary parts, supplies and raw material needed for your final product while on the front end you’ll need to set up distribution channels and sales channels to get the product to the customer. All of this is relative to scope and scale. The Nike’s of the world have to find material, cut material, have the shoe produced, shipped from overseas to a central location, have that shoes distributed around the country to localized distribution warehouses, have those warehouses distribute to local retail stores or online e-businesses (if holding physical inventory). That’s not to mention the design team, the marketing team, the sales team, the executives who have to get involved, the finance needed for the product to support the brand and so forth. I’ve purposely left out other decision makes and people who go down the line from string to having your shoes paid for and put in a bag at your local retail store. The process almost seems never ending. Through all of this though, the ultimate people are the consumers. Dollar bills (or the American greenback) make thrills and determine what is going to be on the shelf, in the market, online and distributed.
Side note: I believe that over 65% of the world daily trade is tied in with the U.S. $100 bill. It is the worlds most traded currency by a large margin and has more cross-currency trading (FOREX trading term) ability than any other. If you are interested, here is a good article.
The process ties in with the people. As mentioned above with the people, there is a lot that ties into the production of a product. It’s not as simple as many would think. When you are walking around a mall with your cup of coffee that was purchased on a futures contract by a person who flew to Central America to secure a price per pound for thousands of pounds from a farmer they’ll hardly talk to that is going to plant, tend and feed the plants necessary to get the coffee and pay people to pick those beans, bag them and ship them to someone locally who will get all the proper paperwork taken care of to ship the raw material to a factory that specializes in crushing beans or repackaging them as a whole bean and then ships them to a local distributor somewhere near you and around the country so that the distributor can take all of the orders placed and have them put on pallets that go on trucks that the driver will drive around town bringing the products that are needed that day to the local coffee shop so that a person can make you what you want to order so that you can walk around the mall…. ****breath**** sorry, that’s a lot to take in, but that was the process for one cup of coffee that may or may not cost about $2.50. Now thinking about the mall and all the products that are available; a majority of them made a similar journey with their final destination being on display with a hanger. It can get tiring and there are a lot of people involved in the process along the way.
“Clients don’t care about the labor pains; they want to see the baby.” – Tim Williams
The final P is the physical evidence. This is the final product that is on the shelf or viewed online. It’s the consistent branding that McDonald’s or Starbucks gives us through packaging their product in the same wrappers and cups whether you are in San Diego, California or St. David, Maine. It’s the reviews that are read online, the consistency, the ability to find the product. Physical evidence is inclusive of social media, company website, product reviews, distribution and others. It is marketing the brand and using advertisement for the purpose of brand and product recognition. It is a continuing and evolving process that helps to lengthen the product life cycle and the continuity of a revenue stream.
As we can see, everything ties in together when we talk about the marketing of a product. There are a lot of different definitions of marketing, but I personally cannot handcuff marketing and sales or marketing and advertising. Marketing helps to research the potential for a product, determines who to target, segment and market then tells sales who to go for and advertising what the meaning behind the ad should be. The 7 P’s really help to keep focus on what the ultimate goal is and gives a perspective of the steps involved in bringing a product to market. There is so much that goes into marketing that one individual cannot specialize in it all. And it’s good that this is the 7 P’s and not the ‘Six and a half P’s with half a S’ or the PPPPPPP.