The 4 Ps

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-2

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

Basic Place Decisions

Distribution channels (trucks, pipes, air, water, etc.) Market coverage (exclusive, selective, inclusive) Inventory management Warehousing Transportation and logistics

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

Place-2

using semi-trucks or airfreight carriers utilizing intermediaries or wholesalers in the distribution process Includes whether or not products should be sold online or internationally

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

Limitations of the 4 Ps-2

By grouping marketing decisions into four broad categories, it is difficult to distinguish between specific activities such as financing, branding, shipping, etc.

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 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

Place

Is also described as "distribution" Refers to introduction of the product to consumers and determining appropriate transportation or delivery methods

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 Marketing Mix

Must be customer driven Should relate directly to a company's target market Includes four interrelated concepts and tactics Refers to the variables a company can control

The 5th P

People

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

Marketing Mix Decisions

Price list price discounts payment terms financing promotional pricing Product appearance quality packaging branding services Place channel members market coverage sales locations transportation inventory control Promotion advertising personal selling public relations message media budgets

Place: Customer Application

Products should arrive on-time in order to meet customer needs Inventory shortage may drive customers away A store's location may impact buying decisions Some customers are prone to specific product outlets, such as the Internet

Promotion-2

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

Limitations of the 4 Ps-3

Some industry professionals have attempted to expand the concept by adding a "fifth P"

Importance of the Internet-2

The Internet can be used to change, optimize and enhance marketing strategies Online services can be easily adapted to meet changing trends

Limitations of the 4 Ps

The marketing mix specifically applies to companies with physical products and often limits Internet and service-based organizations

Place (Distribution)

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

Promotion

advertising personal selling sales promotions publicity and public relations

Interdependence

decisions cannot be made about a product, without also considering the relationship of price

Interdependence-2

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

4 Ps

price product place promotion