Nearly every business on the planet sets out with the main objective of earning money. This is usually 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 company can offer a product or service that is genuinely unique and cannot be provided by anybody else. This means that your enterprise 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 organisations to draw potential customers to do business with them and not with their competitors. It is a very extensive topic that is influenced by a great number of internal and external variables, but when done well it can be the one business practice that could make or break a company. Any time spent on marketing will reap benefits, although spending this time correctly can yield incredible results.
So where should you begin when creating a marketing strategy for your own company? Well, each situation is different, and each industry will have its own set of advantages and weaknesses that must be taken into consideration, but there is a marketing rule that can be applied to almost any corporation 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 in the 1950′s and is an expression that is used to describe the fundamental building blocks of any marketing system. It demonstrates the fact that marketing is not a simple, blunt-edged business technique, but rather a subtle balance of different aspects of business operations. It got its name because it is similar to the ingredients checklist for a recipe.
The term was later developed 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 easy for business managers and marketers to quickly relate the elements of marketing to the strengths of their own organisations, and by doing so could very rapidly create a personalised and effective marketing system. The four P’s are Product, Price, Place and Promotion.
While we were preparing the release for some of our event management services we applied concepts in the marketing mix to devise a strategy.
Product
Although every element of the marketing mix is a requirement, the “product” element mentioned as one of the four P’s is perhaps the most critical of all. It describes the physical product or intangible service that your business will be offering, and at the end of the day it is the reason that buyers are going to spend money with you. If this element is not correctly managed then your organisation will find it hard to make it through.
Several people don’t think that marketing has any place to play when it comes to the physical product that your business is selling. In fact, the typical train of thought very often bears the precise opposite sentiment. Surely it should be the other way around – your manufacturing department creates a product for sale and then it is the job of the marketing department to discover ways to sell it, right? This is not necessarily the case.
Take the computer software market as an example. There are many established brands of both operating system and software application solutions on the marketplace already, and because the market is relatively well saturated it would be incredibly tough (and expensive) to “take on the big boys”. So how can the principles of the marketing mix assist in this situation?
Rather than developing an operating system and then trying 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 sought after in the current marketplace, and how feasible it would be to produce and sell them.
Once your goods have been designed and created it is still a vital skill to be able to objectively evaluate your own products to recognise the reasons why a customer would buy your product rather than a competitors’.
Another form of this part of the marketing mix is called product variation and is generally used to either extend the lifecycle of a product currently in the market, or to make your brand new product attractive to as many customers as possible. Once again, this method can be applied at all stages of product development.
The motor industry uses this technique very effectively by offering various engines, trim packages and interior options with the cars that they sell. They use the marketing mix to good effect to sell their own goods in an extremely competitive marketplace. Whilst these companies may have substantial marketing budgets, the same concepts can be applied to all companies.
As part of our individual marketing plan, our business carefully researched what exactly made our products stand out from the masses.
One of the most recent forms of promotional marketing is by means of websites that offer flexible and accessible means to reach potential consumersOur website is at www.rostrum.eu .
Price
Another important factor in the marketing mix relates to 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 pay (although that can be a useful tool to use), but rather making use of the price of your products as a strategic weapon designed to achieve any specific objectives your company has. The potential benefits of an effective pricing plan are surprisingly substantial!
Although it may seem obvious, it is still worth noting that price has always been, and probably always will be, one of the crucial factors that shoppers take into account when they are making a purchase. It is also worth noting that customers do not always consider the cheapest price to be the best price. In fact a price that is too low can often turn buyers away.
There are many questions that you need to ask yourself while devising a good pricing strategy, key among which are the price sensitivity of your clients, what your rivals are doing and how can pricing maximise your own profits. From a strategy point of view however, pricing can be covered by two primary principals; price skimming and also penetration pricing.
Price skimming
The principal idea driving price skimming is to make as much money as possible from the segment of the market which is price-insensitive and will be willing to spend a premium amount of money to receive a product or service early on.
This pricing strategy is very often used in the consumer electronics market 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 core of customers that would pay it. By making use of this method as part of a pre-ordering strategy, a firm can help to smooth its own cash flow.
Penetration pricing
Penetration pricing is at the other 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 risky strategy, but when used correctly it can create revenue streams for many years to come.
Yet another thing to bear in mind is that “price” is the one part of the marketing mix that will generate earnings for a business. The other members of the four P’s will all cost money to produce or undertake. So it is even more essential to get your pricing technique right.
To optimize our web site for google marketing we selected large childrens bean bags as a targeted phrase because it relates to our company and what we do.
Place
Place is the portion of the marketing mix that is often overlooked by companies, but it is still an important part of selling your product successfully. In short, it describes the method in which you provide your product to your customer, and subsequently how you collect money from them. It can be a great marketing technique when used appropriately.
The most common ramifications of place-based marketing are the physical venues in which your goods are sold. For the majority of consumer products, this involves the distribution infrastructure between your manufacturing plants and shops and other outlets around the country. Since distribution of a physical product costs money it is crucial to determine your own priorities and adjust your distribution network appropriately.
With the growing use of the Internet by your potential customers, marketing methods have had to take into account how they use the Internet to help distribute their products. By using the Internet as a point of contact (or even as a whole distribution route in download-based markets such as MP3s) firms are now able to reach out to a large pool of possible customers.
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 employed on a very individual basis or as a mass communication instrument, and whilst it might be an expensive undertaking it is often an important one. The key concern of promotion is to deliver a specific message that will increase sales.
Advertising is one of the most common 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 just as targeted advertising material posted through your front door. The potential for individualised advertising has never been so great.
Another important part of promotion involves branding, which will not necessarily yield more sales directly, but goes back to one of the preliminary purposes of marketing; getting customers to choose your product over those of your competitors. When all other parts of the marketing mix are equal it can be branding that swings a customer’s choice.
Putting it into Practice
As previously mentioned every company is unique and will have different marketing requirements. By using a mixture of the four P’s discussed above you can take a good view of your own marketing plan.
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