Foundational marketing strategy has focused on the 4Ps, we call these four elements – product, price, place, and promotion – the marketing mix. These four elements are the controllable components of our marketing toolkit. In recent years, marketing thought has evolved to include additional Ps, some say 6, some say 7. Today, let’s talk about what I call the 4Ps+, the six elements I think are really important to putting together your marketing strategy.
We’ll start with our 4 traditional elements and speak first about product. Product refers to the tangible product you are offering or the intangible service you are providing. You want to make sure that the product you are offering aligns with a consumer need and offers an opportunity to meet that need.
So, ask yourself, what are you offering and how will your customer benefit from your offering? Then think more deeply about the components of your product. Will there be variations in things like size, color, capabilities? Is your product related or adjacent to anything? Are customers required to have anything else to be able to utilize it? And how does what you are offering differ from what is already on the market?
Then, let’s dive into price. Price is something that looks pretty simple to us as consumers, but it is often one of the most complex pieces of our marketing mix. There are quite a few questions to ask yourself as you develop your pricing strategy. The first is how much are customers willing to pay? This is what I like to call a qualifier question. If you have dreamed up a product or service that you think is remarkable, but customers are not willing to pay you enough to cover your cost and allow you to retain a profit, then you don’t have a viable product. Let’s assume you have made that evaluation and you have something with potential.
What is the cost of buying materials, producing your offering, selling your product, and discounting if necessary? How are you intending to position your product offering? Will you be competing on price, or are you focused on supporting a premium price position? Is your market entry strategy different than your post-launch strategy – will there be early-bird pricing? Will consumers experience switching costs to move from their current solution to yours? If so, are you helping mitigate those in any way for any period of time?
Lastly, on price, be sure you understand what the market average is and how key competitors are navigating their pricing strategy. Are there common practices in your industry that you would be expected to align with? And what kind of profit do you need to or want to retain?
As far as place goes, you want to consider where your offering will be and should be available. Which sales channels will you use? If you aren’t sure what makes sense here, start with customer expectations. Where would customers expect to obtain your product or access your service? Where are your prospective customers located and what can you learn about where they are currently buying? Much of this depends on the type of product or service you are selling. If your product or service is broadly available across the market, you may need to undertake more comprehensive distribution or have more retail outlets. If your product does not require in-person interaction, online may suit you just fine. And if you produce is targeted at a niche market, you might want to consider whether customers will go to greater lengths or drive greater distances to access something that is special, expensive, or really meets their narrow or specialty need.
And don’t forget that your place component needs to consider not only the ultimate place of the sales transaction, but all of the logistics and supply chain elements that need to be worked out, and accounted for in cost, to get your product or service to that end consumer. Are you using a drop shipper, renting space in a warehouse and hiring a fulfillment team, etc.? How does your product or service make its way through the chain of production into the market?
Now let’s talk about one of the most popular elements of the marketing mix, promotion. Here we are talking about the forward-facing efforts that help us gain the attention of prospective customers. The main question here is how do we intend to communicate with them? There are more tools than ever in our promotional toolkits these days across online and offline platforms, so we want to be sure we leverage the ones that will show return and don’t get lost in spending time chasing all of the ones that won’t. Instead of thinking about which platforms and tools we would like to use, our obligation as marketers is to look at our current and prospective customers and figure out which platforms and tools they use. Who are we serving and where can we find them?
There is a lot to be achieved in the promotion piece of our marketing mix, so we have to be conscious of managing our resources, both in time and budget. Will you be taking on these efforts in-house? Does your team have the time and knowledge to handle all of the components internally? Will you leverage an agency relationship to be sure you are always benefitting from the latest expertise and industry knowledge? Agencies can also help expand your capacity and let your team focus on other tasks. You may choose to do some efforts yourselves and outsource others, with brand management, product development, direct marketing, social media marketing, advertising, PR, and more to consider, you have to find the formula that works for you, your customer needs, and your budget.
Now, let’s talk a minute about those plus Ps. In addition to the 4 foundational Ps we talked about here – product, price, place, and promotion – I personally believe that there are 2 other Ps that we need to overlay on all of these elements, and those are people and process.
People refers to both who will buy your product and who will produce it/sell it/service it.
There are people involved all throughout your organization and the 4Ps planning process who need to be accounted for. Where are they? What critical roles do they fill? How are these team players directed and motivated? How are you measuring their performance, is any of that related to their role in the marketing process? Are different points of the customer journey being attributed to different teams? What role do the people in your organization really play?
Outside of your team, there are customers that you are all working to serve. What can we learn about them? We want to know our customers and prospects as deeply as we can so we can offer products and services that provide value, can price those offering to a level that is suitable, can get them to customers at the right place at the right time, and can communicate with them throughout your relationship.
Finally, my other bonus P is process. What operational procedures need to be in place to make it all work? We want to deliver a quality product to consumers who will become loyal customers, and to do that, we need to be efficient and effective.
Thinking about your marketing mix in this 4Ps+ manner can help you start with a broad-based look at your efforts and dig into each more deeply to improve them.