The marketing mix definition is based on one principle – to find the right mix of product, services, promotional strategies, and the right price.
Marketing Mix is a business tool that is often used by both experienced and newbie marketers. The definition is simple; it’s about putting the right product or a combination thereof in the place, at the right time, and at the right price. The difficult part is doing this well, as you need to know every aspect of your business plan.
However, you can be sure to attract mountains of profits when you understand these concepts, especially when you are pursuing your own passive income ventures online. Understand this and you will understand exactly how to turn your life around by creating your own rich, passive money flow.
The marketing mix is predominately associated with the 4p’s of marketing, the 7p’s of service marketing, and the 4 Cs theories developed in the 1990s.
Here are the principles used in the application of the right marketing mix:
McCarthy’s 4 Ps
A marketing expert named E. Jerome McCarthy created the Marketing Four Ps in the 1960s. This classification has been used throughout the world. Business schools teach this concept in basic marketing classes, and it can definitely make or break a marketing campaign. The marketing four Ps are also the foundation of the idea of marketing mix.
A product is an item that is built or produced to satisfy the needs of a certain group of people. The product can be intangible or tangible as it can be in the form of services or goods. A lot of people don’t understand that this applies to goods and services online too – a major foundation to understanding how to “make it” online.
During the product development phase, the marketer must do an extensive research on the life cycle of the product that they are creating. You see, a product has a certain life cycle that includes the growth phase, the maturity phase, and the sales decline phase. It is important for marketers to reinvent their products once it reaches the sales decline phase.
Marketers must also create the right product mix. It may be wise to expand your current product mix by diversifying and increasing the depth of your product line. Marketers should also consider several product development strategies.
In developing the right product, you have to answer the following questions:
- What does the client want from the service or product?
- How will the customer use it?
- Where will the client use it?
- What features must the product have to meet the client’s needs?
- Are there any necessary features that you missed out?
- Are you creating features that are not needed by the client?
- What’s the name of the product?
- Does it have a catchy name?
- What are the sizes or colors available?
- How is the product different from the products of your competitors?
- What does the product look like?
The price of the product is basically the amount that a customer pays for to enjoy it. Price is a very important component of the marketing mix definition. It is also a very important component of a marketing plan as it determines your firm’s profit and survival. Adjusting the price of the product has a big impact on the entire marketing strategy. Adjusting the product price can greatly affect the product sales and product demand.
When setting the product price, marketers should consider the perceived value that the product offers. There are three major pricing strategies, and these are:
- Market penetration pricing
- Market skimming pricing
- Neutral pricing
The following are some of the important questions that you should ask yourself when you are setting the product price, regardless whether this is offline or online. Arguably, much greater profits are achieved when this is done online, in addition to much more passivity:
- How much did it cost you to produce the product?
- What is the customers’ perceived product value?
- Do you think that the slight price decrease could significantly increase your market share?
- Can the current price of the product keep up with the price of the product’s competitors?
Placement or distribution is a very important part of the product mix definition. You have to position and distribute the product in a place that is accessible to potential buyers. There are many distribution strategies, including:
- Intensive distribution
- Exclusive distribution
- Selective distribution
It is extremely vital to remember that the internet never sleeps. If your “placement” is on the web, you will without a doubt be making money in your sleep, literally.
Here are some of the questions that you should answer in developing your distribution strategy:
- Where do your clients look for your service or product?
- What kind of stores do potential clients go to? Do they shop in a mall, in a regular brick and mortar store, in the supermarket, or online?
- How do you access the different distribution channels?
- How is your distribution strategy different from your competitors?
- Do you need a strong sales force?
- Do you need to attend trade fairs?
- Do you need to sell in an online store?
Promotion is a very important component of marketing as it can boost brand recognition and sales. Promotion is comprised of various elements like:
- Sales Organization
- Public Relations
- Sales Promotion
Advertising typically covers communication methods that are paid for like television advertisements, radio commercials, print media, and internet advertisements. There are also a wide number of ways which advertising can be done online.
Public relations, on the other hand, are communications that are typically not paid for. This includes press releases, exhibitions, sponsorship deals, seminars, conferences, and events.
Word of mouth is also a type of product promotion. Word of mouth is an informal communication about the benefits of the product by satisfied customers and ordinary individuals. The sales staff plays a very important role in public relations and word of mouth. It is important to not take this literally. Word of mouth can also circulate on the internet. Harnessed effectively and it has the potential to be one of the most valuable assets you have in boosting your profits online.
In creating an effective product promotion strategy, you need to answer the following questions:
- How can you send marketing messages to your potential buyers?
- When is the best time to promote your product?
- Will you reach your potential audience and buyers through television ads?
- Is it best to use the social media in promoting the product?
- What is the promotion strategy of your competitors?
Having a successful marketing mix means that you should have the right product that is positioned at the right place and at the right price.
The Seven Ps
The Seven Ps model is a marketing model that modifies the four Ps model. The 7 P’s is generally used in the service industries. Here are the items added to the 4 Ps in the Seven Ps marketing model:
The company’s employees are important in marketing because they are the ones who deliver the service. It is important to hire and train the right people to deliver superior service to the clients.
The systems and processes of the organization affect the execution of the service. So, you have to make sure that you have a well-tailored process in place.
- Physical Evidence
In the service industries, there should be physical evidence that the service was delivered.
The Four Cs
The Four Cs marketing model was developed by Robert F. Lauterborn in 1990. It is a modification of the Four Ps model. Here are the components of this marketing model:
- Cost – According to Lauterborn, price is not the only cost incurred when purchasing a product. Cost of conscience or opportunity cost is also part of the cost of product ownership.
- Consumer Wants and Needs – A company should only sell a product that addresses consumer demand. So, marketers and business researchers should carefully study the consumer wants and needs.
- Communication – According to Lauterborn, “promotion” is manipulative while communication is “cooperative”. Marketers should aim to create an open dialogue with potential clients based on their needs and wants.
- Convenience – The product should be readily available to the consumers. Marketers should strategically place the products in several visible distribution points.
Whether you are using the Four Ps, the Seven Ps, or the Four Cs, your marketing mix plan plays a vital role. It is important to devise a plan that balances profit, client satisfaction, brand recognition, and product availability. It is also extremely important to consider the overall “how” aspect that will ultimately determine your success or failure.
Opening a physical business up carries much greater risk with much higher start-up costs, employees and also stock levels, in addition to various overheads as well as your heavily sacrificed time. On the other hand, an online business carries little to no risk as all the risk is absorbed due to the nature of the internet.
The largest costs are related to domain names, hosting and advertising costs which range from a few cents to a few hundred dollars, completely depending on your budget. The biggest difference between the two stores is that an online store yields an unlimited amount of growth online.