What Is Marketing Mix : Thinking of business, there are many things that we have to learn. Now, we would to understand the most important of business are marketing. Let’s breathe for a moment and prepare your self to starting learn of marketing.
Marketing can be applied both goods and services. That’s your choice. Just to remember, there are a lot of things that need to be considered such as
- Product life cycle, the strategy must be adjusted to the stages of the life cycle, namely the introductory stage, growth stage, maturity stage and setback stage;
- The level of company competition in the market, the marketing strategy must be adjusted to the company’s position in the level of competition, whether in the category of lead, challenge, follow or only take a small part of the market;
- Economic circumstances, marketing strategies must be adjusted to the economic situation, companies must look forward and develop long-term strategies to meet changing conditions in their industry and ensure the long-term sustainability of the company.
Next, we will learn about marketing strategies. There are 4 important components in marketing or known as the marketing mix. This was first proposed in 1960 by E. Jerome McCarthy. The 4P marketing model is the most relevant and widely accepted framework in marketing today. Many other models such as 8 Ps & 4 Cs have been developed on top of this model.
It is confusing, isn’t it? But, calm down. I will answer all the questions in your mind
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What is 4P marketing model?
“The marketing mix is a tactical marketing tool that can be controlled, product, price, distribution, and promotion combined by the company to produce the desired response in the target market”.
“A collection of variables that can be used by companies to influence consumer responses”
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How many type of the marketing models?
Basically there are 4 types
1.) Products – What is the company’s manufacturing?
2.) Prices – What is the company’s pricing strategy?
3.) Place – Where does the company sell?
4.) Promotion – How do companies promote their products?
Why is it considered an important element?
“The product is everything can be offered in the market to get attention, demand, usage or consumption that can fulfill the wants or needs”. Products are not only in the form of goods but can be in the form of services or a combination of both (goods and services) also. There are several questions that arise before marketing a product, such as
- What are your product features?
- What will be the quality of your product?
- How are the product features different from the market?
- What will be the product range, product mix & product line?
- How will you package the product?
- Will the product be labeled as a sub brand or really new?
- What are the secondary products that can be sold together with the primary (guarantee, service)
- Are there product returns and how will they be managed?
- How will you handle the product at every stage of the product life cycle?
Based on these questions, there are several decisions need to be made. This decision will affect other variables of the mixture also.
Example: laptop X, the strategy is to make a laptop with good design and product quality. That’s why, it is perceived as a premium product. All parts of the product must reflect premium or exclusive products.
But if you find that the product you want is not in accordance with the overall marketing mix, then you need to reprocess the product to fit in the mix
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The price is, “The amount of money (plus some products if possible) that is needed to get a number of combinations of goods and services”. After the product is ready to be sold, the company will determine the price of the product.
The main considerations in pricing are product costs, advertising and marketing costs, market price fluctuations, distribution costs, etc. Another important factor is pricing competitors. All of this changes dynamically and therefore prices need the same factors. Prices also affect product targeting & positioning. Therefore sales promotions will require different strategies in the form of discounts. Below are some of the decisions you need to make here.
- What is the current price on the market for the same product?
- Are customers willing to pay premium if more features can be added?
- What is the cost & margin of benefits in the price structure to make the desired margin?
- What are the margins for distributors, retailers at different levels in the distribution channel?
- What are the payment terms for the product?
Example: For Laptop X as a premium product, the price is high and rarely gives a discount so the selling price of the used is still high. Generally the higher prices will reduce demand. For premium products, sometimes higher prices will increase sales due to greater prestige.
The place in the marketing mix is usually called the distribution channel, the channel where the product reaches consumers. The definition distribution channels is, “Channels used by producers to distribute these products from producers to consumers or industrial users”
There are many decisions that need to be taken here
- How broad do you want the product to be distributed?
- Are these products that must be in a particular shop?
- How fast should the material reach customers?
- Should there be inventory levels?
- How will the material be transported?
- Which channels will distribute your products to customers?
- Do you want to provide your own product or do you want a franchise?
- Distribution does affect profitability. In the case of telecommunications companies dealing with paper refilling, the increase in transportation costs will bring a drastic change in profitability. Therefore, vital logistics & supply chains are a must to ensure optimal distribution & appropriate pricing
Promotion is a form of marketing communication. What is meant by marketing communication is marketing activities that try to disseminate information, influence / persuade, and / or remind the target market of the company and its products to be willing to accept, buy, and be loyal to the products offered by the company concerned.
Now that you get the right product at the right price in the right place, it’s time to promote the product to the customer. Things that need to be considered
o Proportion of promotions made
o The message you want to convey
o Media promotions carried out
o How often promotion is done
Example: the strategy carried out by a travel online shop is to give a message of convenience to book a hotel that is communicated massively in several media such as television, billboards and other media so that the message to be conveyed is quickly achieved.
Application of the 4P method Implementation in marketing bakery stores
Imagine you have Bakery catering for teens. Your marketing strategy with the 4P marketing model is as follows:
- products : Low cost and attractive product mixes such as milk shakes
- Price : Competitive compared to the nearest store
- promotions : Ads at the nearest college,
- places : close locations and suitable for Colleges, Youth Hangouts.Vibrant great Music & Youth Citra on location
- people : friendly staff and adapting to the needs of Teenagers
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4P marketing relevance to the digital era
We live in the digital era now. Mobile phones continue to be a part of our lives and brands need to adapt to this new way of life. Let’s understand how 4P is more relevant to the digital era
With more sales going through digital space. Customers don’t see the actual product before purchasing. This makes it more difficult to ascertain whether he has made the right purchase
This makes it tighter for brands. Customers can easily check product reviews on the web or check on social media almost the same. Poor quality products mean customers take to social media with bad reviews or review your product on a review website. Then the quality of products becomes more important in this digital era
Pricing continues to be a major purchasing decision for most customers. Digital media allows tracking of purchasing behavior & then personalized offers can be made for customers. Various pieces Customer segmentation is possible because of the variety of data available. This allows dynamic pricing according to previous purchase patterns. Customers who look close to the purchase in the funnel can be given a coupon that will generate instant sales.
With this new digital media, Place has also become an important part in the customer’s purchasing decision process. The supply & logistics chain plays an important role because it will affect the end customer experience & will play an important part in pricing
Promotion may have changed a lot in 4P marketing. Traditionally products have been promoted primarily through ATL communication using Radio, TV, print, and outdoor advertising. FSI (or Free Standing Inserts) are also used on a large scale in consumer goods packages to introduce new products and generally provide coupons in their weekly newspapers. Although coupons can be tracked in the list / place of purchase, other advertisements such as TV and radio further increase brand awareness and encourage customers to act