Practically every company on the planet sets out with the main objective of earning money. This is generally done by producing some form of product, or offering a service, and then charging customers money for it.
First of all, it is a very rare case where a business can offer a product or service that is genuinely unique and cannot be supplied by anyone else. This means that your company will be contesting with other businesses that sell a similar item and you will both be trying to make money from the same customers, who only want to spend their cash once.
Marketing is the main tool used by modern businesses to draw prospective customers to do business with them and not with their competitors. It is a very broad topic that is affected by a great number of internal and external factors, but when done well it can be the one business practise that could make or break a company.
So where should you begin when creating a marketing strategy for your own business? Well, every situation is different, and every business will have its own set of strengths and weak points that must be taken into consideration, but there is a marketing principle that can be applied to almost any company to be used as a marketing platform. It is called the “Marketing Mix”.
The Marketing Mix
The marketing mix was a term that was first coined during the 1950’s and is an expression that is used to describe the fundamental building blocks of any marketing strategy. It reflects the fact that marketing is not a simple, blunt-edged business technique, but rather a subtle balance of different elements of business operations. It got its name since it is similar to the ingredients checklist for a recipe.
The term was later built upon to include the concept of “four P’s” that described the critical elements of the marketing mix. The formalisation of these P’s made it very clear for business managers and marketers to swiftly relate the elements of marketing to the strengths of their own companies, and by doing so could very quickly form a tailored and efficient marketing plan.
Our company created a promotional plan for our own stained concrete floor products by using this marketing mix to determine our marketing strengths.
Product
Whilst every element of the marketing mix is a necessity, the “product” element mentioned as one of the four P’s is perhaps the most critical of all. It identifies the physical product or intangible service that your company will be selling, and at the end of the day it is the reason that customers are going to spend money with you. If this part is not correctly managed then your organisation will find it hard to survive.
Many people do not think that marketing has any place to play when it comes to the physical product that your business is selling. In fact, the common train of thought very often bears the precise opposite sentiment. Surely it should be the opposite way around - your production department creates an item for sale and then it is the job of the marketing department to find ways to sell it, right? This is not necessarily the case.
Consider the computer software market as an example. There are many established brands of both operating system and software application solutions in the market already, and because the market is fairly well saturated it would be very tough (and expensive) to “take on the big boys”.
Rather than creating an operating system and then attempting to craft a marketing strategy to take on the likes of Microsoft or Apple, it would be far more effective to look at what sorts of product are desired in the current marketplace, and how viable it would be to produce and sell them.
Once your products have been fashioned and created it is still a critical skill to be able to objectively evaluate your own products to recognise the reasons that a customer should buy your product rather than a competitors’. The skill is called product differentiation and is one of the basic skills of the product part of the marketing mix cake.
A different form of this part of the marketing mix is called product variation and is generally used to either extend the lifecycle of a product already in the market, or to make your brand new product attractive to as many consumers as possible.
The car industry uses this technique very effectively by offering different engines, trim packages and interior options with the cars that they sell. They use the marketing mix to good effect to sell their own products in an incredibly competitive marketplace.
An example of one of the most recent forms of public advertising is the new horse games for girls website that provides flexible and accessible means to reach potential customers.
Price
Another key factor in the marketing mix concerns the price of your products or services. This is not a simple case of carrying out market research to figure out the highest price that your customers would spend (although that can be a handy tool to use), but rather making use of the price of your products as a strategic tool designed to achieve any specific objectives your business has.
Whilst it may seem obvious, it’s still worth pointing out that price has always been, and probably always will be, one of the key factors that shoppers take into account when they are making a purchase. It is also worth noting that customers do not constantly consider the cheapest price to be the best price.
There are many questions that you need to ask yourself when devising a good pricing plan, key among which are the price sensitivity of your customers, what your rivals are doing and how can pricing boost your own profits. From a strategy point of view however, pricing can be covered by two primary principals; price skimming and penetration pricing.
Price skimming
The main idea driving price skimming is to make as much cash as possible from the segment of the market which is price-insensitive and are going to be prepared to spend a large amount of money to receive a product or service early on. Not only can this technique yield great economic benefits, but it can also promote an exclusive and high quality image of your product.
This pricing strategy is frequently used in the consumer electronics industry where customers will often eagerly await the release of a new mobile phone or computer games console. Manufacturers could set almost any price they wanted to and there would still be a loyal base of customers that would pay it. By using this method as part of a pre-ordering strategy, a company can help to smooth its own money flow.
Penetration pricing
Penetration pricing is at the opposite end of the pricing spectrum, and is tailored towards gaining a large market share at a short-term cost so that financial benefits can be earned long into the future. It can be a high risk strategy, but when employed correctly it can setup revenue streams for many years to come.
Yet another thing to keep in mind is that “price” is the only part of the marketing mix that will generate income for a business. The other members of the four P’s will all cost money to produce or carry out. So it is even more vital to get your pricing strategy right.
To optimise our web site for search engine marketing we selected large childrens bean bags for an aimed phrase because it relates to our company and what we do.
Place
Place is the component of the marketing mix that’s often not addressed by companies, but it is still an important part of selling your product effectively. In a nutshell, it describes the method in which you provide your product to your customer, and consequently how you collect money from them. It can be a great marketing technique when applied correctly.
The most common implications of place-based marketing are the physical venues in which your products are sold. For the vast majority of consumer products, this involves the distribution network between your production centres and retailers or other outlets around the country. Since distribution of a physical product costs money it is crucial to determine your own priorities and modify your distribution network appropriately.
With the growing use of the Internet by your prospective customers, marketing strategies have had to consider how they use the Internet to help deliver their products. By using the Internet as a point of contact (or even as a whole distribution channel in download-based markets such as MP3s) companies are now able to reach out to a huge pool of potential customers. Effective placing of your product or service can therefore yield impressive economic results.
Promotion
When you mention the word “marketing”, most people immediately think of the promotional aspect of the marketing mix, although as we have seen, this is only one branch of a more comprehensive system. Promotion can be used on a very individual basis or as a mass communication tool, and whilst it may be an expensive undertaking it is often an important one.
Advertising is one of the most typical forms of promotion. Classically it would be done by posting on billboards, producing short clips for TV and radio or by physically handing out flyers or leaflets to potential buyers. With the arrival of the information age we have seen a great increase in promotion via e-mail and the Internet, or simply as targeted advertising material posted through your front door.
Another important part of promotion involves branding, which will not necessarily yield more sales directly, but goes back to one of the initial purposes of marketing; getting customers to choose your product over those of your rivals. When all other pieces of the marketing mix are equal it could be branding that sways a customer’s choice.
Putting it into Practise
As previously mentioned each company is different and will have different marketing needs. By using a mixture of the four P’s discussed above you can take an effective view of your own marketing strategy.
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