The 4 Ps

Basic Place Decisions

Distribution channels (trucks, pipes, air, water, etc.) Inventory management Warehousing Transportation and logistics

The 5th P

People includes the following concepts: clearly defining a target market implementing customer-driven strategies creating a service-oriented corporate image

Impact of the 5th P

People determine a company's level of success Customers often provide helpful and needed suggestions Word-of-mouth is the most powerful form of buying suggestion Directing decisions toward the right market is critical

The Mix

Represents the idea that four significant marketing concepts (the 4 Ps) must be strategically coordinated and work together in order to create cohesive business decisions

Basic Pricing Decisions

Determining a suggested retail price Implementing a pricing strategy Creating volume discounts Generating seasonal pricing Producing bundle prices

Place ( Distribution )

Determining which retail outlets will carry specific products Selecting the shelf space or display style which is most effective Researching where a store should be located

Product

Developing new uses or new target markets for a product Examining the product life cycle Adding features to an old product

Place : Customer Application

A store's location may impact buying decisions Some customers are prone to specific product outlets, such as the Internet

Promotion: Customer Application

Brand awareness is the first step toward product sales Public relations and advertising have a direct impact on customer loyalty Promotion stimulates a need and desire to buy Special offers or campaigns often yield higher sales results

Basic Product Decisions

Brand or product name Styling Quality Safety Packaging Repairs and support Accessories and services

Product: Customer Application

Customers buy benefits - not products Products must satisfy a customer want or need Consumers are often heavily influenced by brand name or packaging Extended services or warranties can create customer loyalty New and improved products often have a high success rate

Price:Customer Application

Customers understand value Price is a psychological variable it alters a buyer's motivation price can influence the perception of status or luxury price can stimulate or decrease demand Pricing strategies which do not relate to customer habits will be unsuccessful

The Marketing Mix

Defines the key management decisions needed to be successful in marketing

Price

Includes a wide range of functions and strategies, including: creating a sales price or price list calculating mark-up percentage using promotional pricing techniques understanding pricing laws and discrimination determining discounts, credit terms and available payment methods, such as: cash and credit options credit card machines financing and payment plans

Promotion

Includes decisions about the following Advertising Personal Selling Sales Promotions Publicity and Public Relations

Place

Is also described as "distribution" Includes whether or not products should be sold online or internationally

Basic Place Decisions

Market coverage (exclusive, selective, inclusive)

Importance of the Internet

Marketing mix decisions may directly relate to a company's online presence Leveraging full power of the Internet may be a key business strategy The Internet can be used to change, optimize and enhance marketing strategies Online services can be easily adapted to meet changing trends

Place: Customer Application

Products should arrive on-time in order to meet customer needs Inventory shortage may drive customers away

Place

Refers to introduction of the product to consumers and determining appropriate transportation or delivery methods using semi-trucks or airfreight carriers utilizing intermediaries or wholesalers in the distribution process

Promotion

Relates to the timing of promotional campaigns Refers to the type of message communicated to customers Requires selecting media outlets Creates activities and strategies to increase sales

Basic Promotion Decisions

Selecting advertising media Creating personal sales force tactics Designing sales promotions and special offers Maintaining effective media and public relations Establishing a marketing communication budget

Product

Selecting which products to buy and sell Researching and creating product designs Naming and packaging products Updating, improving or eliminating products from a product line

Interdependence

The 4 Ps are directly related decisions cannot be made about a product, without also considering the relationship of price decisions cannot be made about promotion without understanding the importance of place Proper utilization of the 4 Ps provides a company with a solid foundation for success

Business Buzz

The marketing mix consists of a number of essential functions. Which of the 4 Ps do you think is most important? The "marketing mix" concept was first developed by Neil H. Borden in 1964 after he published an article describing the role of marketing as a "mixer of ingredients"

Limitations of the 4 Ps

The marketing mix specifically applies to companies with physical products and often limits Internet and service-based organizations By grouping marketing decisions into four broad categories, it is difficult to distinguish between specific activities such as financing, branding, shipping, etc. Some industry professionals have attempted to expand the concept by adding a "fifth P"

Place ( Distribution )

Understanding where customers shop Determining how and when a product will be distributed Making decisions about product expansion or international sales

The 4 Ps

price product place promotion