7 P’s of Marketing Mix
Every Brand or business wants to become a market leader for that, it needs to attract the maximum customers out there. To achieve the same, it needs to have an unbeatable marketing strategy. The Marketing Mix model helps marketers plan a solid product or service offering that hits all the right notes with the target audience.
Marketing mix refers to the strategies or plan that a company formulates to increase awareness about its products or services. It is also known as the 4P’s of marketing- Product, Price, Place and Promotion since the marketing mix strategy is a mixture of these four elements. In case of a service, the marketing mix becomes 7P’s of Marketing with other three P’s being- Physical Evidence, People and Process.
Anything that can be offered to a market for attention, acquisition, use or consumption that might satisfy a want or need. It includes physical objects, services, persons, places, organizations and ideas”. Kotler, Wong, Saunders, Armstrong.
There may be 4 different category of products
These are touchable and physical items, a Mobile Handset, a Tooth-Paste, a laptop, a car are Example of tangible products.
These are untouchable and non-physical items, but you can feel it, Mobile apps, Downloadable music
These items are bought by end users for personal consumption, for example, Food items, shirts, Motorbikes etc.
Those items bought for further processing or use in a business For example, raw material,machinery, and components.
The examples of services are Airlines, Multiplexes, Hospitals, Business consulting and Hotel Industry.
The examples are Sports Personalities, Politicians, Public Figures, Film or TV personalities.
Tourist Places like Taj Mahal, Statue of Unity, and Goa etc.
NGO’s like CRY (Child Rights and You), Religious organization like ISKON etc.
Marketplace business models like OYO Rooms, Swiggy, Ola etc. Introduction of 20-20 matches in cricket.
Pricing is an extremely important component to your marketing mix as it determines your profit and costing of your product. Altering the price of a product can affect the entire marketing strategy, whilst also affecting the sales and demand of your product. Few of the pricing strategies are as below:
1.Marketing Penetration Price:
The price is set low in order to increase sales and market share. The goal is to attract new customers based on low price. Example Parle G biscuit.
2. Marketing Skimming Price:
The price is set high initially and is gradually lowered as the product moves through the product life cycle. This is applicable for technology or Electronic products.
The price is set just below a whole number in order to make the product and price more attractive for example keeping price as Rs.499 and Rs.999 and not as Rs.500 and Rs.1000.
The manufacturer will set a high price. The price set will reflect the premium quality of the product. High End Watches like “Omega” or Fashion brands are examples of premium pricing.
5. Bundle Pricing:
In a bundle pricing, Companies sell a package or set of goods or services for a lower price than they would charge if the customer bought all of them separately. Common examples include value meals (Combo Offers) at restaurants.
Prices are set on products that reflect the value of the product. Price of the product is dependent on the perceived value of the products.
7. Captive Pricing:
With some products, you have to buy another item in order to use it. If we look at printers, you need to buy the Ink Cartridge in order to run that printer. Captive pricing is a clever strategy, usually the additional items that are needed will cost more.
8. Cost plus Pricing:
The organisation puts a percentage profit on the cost of making the product. For example if the production cost is Rs.100 and the mark up is 20% the selling price would be Rs.120.
9. Optional Pricing:
A firm will charge extra for any optional products that are sold alongside the main product. Airlines generally keep the fair charges low but if a customer wants to opt for window seat, he will be charged extra.
10. Competitive Price:
A firm looks at their competitors and decides to charge a premium price, an economy price or a mid-range price for their products, compared to their competitors.
In a marketing mix, promotion is an element that can boost sales and brand recognition through Personal Selling, advertising, sales promotion, Direct Marketing, Publicity etc.
It is a part of the promotional mix which involves a one to one communication between buyers and customers (either potential or already customers). As it is a one-to-one communication, it generates direct contact with prospects and customers. Selling of Insurance policy or capital goods or machinery.
One of the key factors in the promotional mix, which contributes to brand building and also how the market perceives the company, is advertising. It is always a big part of the promotional mix because of the far and wide reach of advertising and the message that you can send to your existing and potential customers. Good advertising can build a solid brand for the company. On the other hand, bad advertising with a wrong message, can cause the brand or product to fail.
One of the great advertising success was Cadbury Dairy Milk Chocolate, In 1994 “Asli Sawd Zindagi Ka” ad that broke brand’s ‘ Kids –only’ image and positioned it as a product for Teenage and adult consumption. The iconic ad, which featured a young woman dancing on a cricket field with absolute abandon enjoying a bar of Cadbury Dairy Milk, remains one of the most memorable campaigns in Indian advertising.
Similarly “ Kuch Meetha Ho Jaye” ad series by Amitabh Bacchan for Cadbury Dairy Milk Chocolate, which positioned Chocolate as substitute for the traditional sweets during the festival seasons was also an iconic ad.
Advertisement in Print Media
Advertisement in Electronic Media like TV
Advertisement in Social Media like Facebook or Whatsup
While advertising targets a mass-audience, direct marketing targets prospects and customers. Mobile Messaging, Social media marketing, Email marketing, Internet marketing, are all types of direct marketing used by companies. Company’s employ direct marketing in order to engage in one-way communication with its customers, about product announcements, special promotions, order confirmations as well as customer inquiries
Sales promotions are one of the most common types of promotion used by companies. Their main purpose is to stimulate sales of the product in short terms. Examples include, Special Discount during festival season (Sabse Sasta Din, Big Billion Sale by E-Commerce companies), Free Gifts, Buy 2 get 3 offers, Special offer for Channel partners like free Dubai trip for the purchase of so much quantity.
Lastly, public relations enable an organization to influence a target audience and through this, create a favourable and positive image for the company. The company tries to connect with the audience by sharing information with them about the company and about the product. Seminars, Exhibitions, Blog writing about the products, Press release in Magazines and Newspaper. By pledging 1500 Crores to fight against Corona Virus, Tata Group has generated a lot of positive image and that will be beneficial for the group in the long run.
Place (Distribution Strategy):
Place refers to distribution or the methods and location you use for your products or services to be easily accessible to the target customers. Your product or service dictates how it should be distributed. If you own a retail shop, for example, the distribution chain ends with you and you supply to your customers directly.
If you are manufacturers, your options will be to either sell your products directly or sell them to retailers or dealers as your distribution Strategy. Distribution methods may include, door-to-door sales, retail channels, e-commerce, through exhibitions, Tele Marketing, Through Dealers, through Company owned showrooms, through Franchise etc.
Distribution strategy is dependent on the kind of product and the geography we want to cover for the distribution.
Management Mantra: 7 P’s of Marketing Mix are key factors in success of any business and one has to implement them carefully keeping in mind various factors
Nitesh Kataria, is a writer, Motivational Speaker, Blog Writer and Marketing Professional based in Pune and can be reached at 9822912811 or firstname.lastname@example.org.