Understanding Marketing Mix : 4P’s and 4C’s
The selection of a target market leads the marketers to focus their activities towards profitability of the target segment. For this purpose, they need to manipulate many variables. Such variables were named marketing mix. The term marketing mix was first of all used by Neil Borden, in his American Marketing Association presidential address in 1953. However, E. Jerome McCarthy proposed a classification of marketing mix in four areas viz. Product, Price, Place & Promotion.
The marketing mix is the blending of these four elements as per the needs and
preferences of the specific target market.
Each element of marketing mix has its own set of sub elements. For service industry, an extended version of Marketing Mix with 7P’s has been proposed. Here is a brief Discussion about the 4P’s of marketing mix.
- Product : A product may be a tangible product or an intangible product. A product is produced with a specific volume of units with an aim to satisfy the needs of the customers.. The sub elements of product are Product design, positioning, branding, packaging & labeling, Product line, customer service, warranties & guarantees, new product development, and product life cycle.
- Price: Amount a customer pays for the product is its price. Price is determined by a lot of factors such as demand, supply of raw components. Market share, competition, material cost and operational cost (production cost), and customer’s perceived value of the product. The sub elements of Price include Manufacture, Wholesaler and retailer prices, terms and conditions of pricing, bidding tactics. Discount policies, Price differentiation and Skim vs. Penetrating prices.
- Promotion: Promotion refers to all of the communications that a marketer may use in the marketplace. The supplements are Advertising, Sales force polices, direct marketing, Public relationships, Price promotions, Trade shows and special events. The four distinct factors of promotion are advertising, public relations, word of mouth and point of sale. Promotion may be paid or unpaid. Paid promotions include advertising through various media, sponsorship deals, exhibitions, conferences, seminars, paid participation in trade fairs and events and unpaid promotion include the press releases, word of mouth etc.
- Place: Place refers to the location where a product can be purchased. It represents the distribution channel. The Distribution channel may be direct or indirect. Channel length and channel breadth matter a lot. Some other sub elements are sublets, franchisees, direct sales agents, wholesalers, retailers etc.
The above marketing mix is product focussed. There is a customer-focused marketing mix which is known as 4C model. The elements are 4 C model of marketing mix are Commodity, Cost, Channel and Communication.
