Practically every business on the planet sets out with the primary objective of making money. This is usually done by manufacturing some form of product, or offering a service, and then charging people money for it. This fundamental theory is fairly straight-forward, though it contains many specific details.
First of all, it is a very rare case that a company can offer a product or service that is genuinely unique and cannot be provided by anyone else. This means that your company will be competing with other businesses that sell a similar item and you will both be trying to make money from the same shoppers, who only want to spend their cash once.
Marketing is the main tool used by modern organisations to draw prospective customers to do business with them and not with their competitors. It is a very extensive topic that is affected by a great number of internal and external variables, but when done right it can be the one business practice that can make or break a company. Any time spent on marketing will reap rewards, although spending this time correctly can yield incredible outcomes.
So where should you start when creating a marketing strategy for your own business? Well, each situation is different, and every business will have its own set of strengths and weak points 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 framework. It is called the “Marketing Mix”.
The Marketing Mix
The marketing mix was a phrase that was first coined during the 1950′s and is an expression that is used to express 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 functions.
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 swiftly relate the elements of marketing to the strengths of their own organisations, and by doing so could very rapidly form a tailored and efficient marketing strategy. The four P’s are Product, Price, Place and Promotion.
Our company has grown to become a leader for providing the white orchids after employing customised marketing and advertising ideas across our complete range of offerings.
Product
Whilst 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 company will be selling, and at the end of the day it is the reason that customers are going to spend money with you. If this element is not adequately managed then your organisation will find it hard to survive.
Many people do not think that marketing has any place to play when it comes to the physical product that your company 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 production department creates an item for sale and then it is the job of the marketing department to find ways to sell it, right? This is not necessarily the case.
Consider the computer software market as an example. There are many established brands of both operating system as well as software application products on the market already, and since the market is relatively well saturated it would be incredibly tough (and expensive) to “take on the big boys”.
Rather than developing an operating system and then trying to craft a marketing strategy to take on the likes of Microsoft and Apple, it would be far more effective to look at what types of product are desired in the current marketplace, and how viable it would be to produce and sell them. By being mindful of the marketing mix early on in your product development period you can avoid business dead-ends at a later time.
Once your goods have been designed and created it is still a critical skill to be able to objectively evaluate your own products to identify the reasons that a customer should buy your product rather than a competitors’.
Another form of this part of the marketing mix is known as product variation and is generally used to either lengthen the lifecycle of a product already in the market, or to make your 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 approach 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. Although these companies may have huge marketing budgets, the same concepts can be applied to all businesses.
An example of one of the most recent forms of promotional marketing is the new maytag side by side refrigerators site which provides flexible and accessible means to reach potential consumers.
Price
Another key factor in the marketing mix relates to the price of your products or services. This isn’t a simple case of performing market research to determine the highest price that your customers would pay (although that can be a useful tool to use), but rather using the price of your products as a strategic tool designed to achieve any particular objectives your business has.
Whilst it may seem obvious, it’s still worth pointing out that price has always been, and likely always will be, one of the crucial factors that customers take into account when they are making a purchase. It is also worth noting that customers don’t always consider the lowest price to be the best value. Actually a price that is too low can often turn customers away.
There are many questions that you need to ask yourself when devising a good pricing strategy, key amongst which are the price sensitivity of your customers, what your competitors are doing and how can pricing maximise your own profits. From a strategy point of view however, pricing can be covered by two main principals; price skimming and penetration pricing.
Price skimming
The main idea driving price skimming is to make as much cash as possible from the segment of the market which is price-insensitive and will be willing to spend a premium amount of money to get a product or service early on.
This pricing strategy is very often used in the consumer electronics industry 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 base 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 money flow.
Penetration pricing
Penetration pricing is at the opposite end of the pricing spectrum, and is tailored towards gaining a large market share at a short-term cost so that financial rewards can be earned long into the future. It can be a high risk strategy, but when used correctly it can create revenue streams for many years to come.
Yet another thing to keep 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.
Grabbing any of the on-line search market is very beneficial, so choose any phrase, like electric quad bikes then assess if that phrase has an adequate search market for your purposes.
Place
Place is the component of the marketing mix that’s often overlooked by companies, but it’s still a significant part of selling your product effectively. In short, it describes the way in which you provide your product to your consumer, and consequently how you collect money from them. It can be a fantastic marketing technique when applied correctly.
The most typical implications of place-based marketing are the physical locations in which your goods are sold. For the vast majority of consumer products, this includes the distribution infrastructure between your production centres and retailers and other outlets around the country. Since distribution of a physical product costs money it is important to identify your own priorities and adjust your distribution network appropriately. This is the primary application of this part of the marketing mix.
With the growing use of the Internet by your prospective customers, marketing strategies have had to take into account how they use the Internet to help distribute their products. By using the Internet as a place of contact (or even as a whole distribution channel in download-based markets such as MP3s) firms are now able to reach out to a huge pool of possible customers.
Promotion
When you say the word “marketing”, many people instantly think of the promotional aspect of the marketing mix, although as we have seen, this is only one branch of a more complete system. Promotion can be used on a very individual basis or as a mass communication tool, and whilst it might be a costly undertaking it is often an important one.
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 witnessed a great increase in promotion via e-mail and the Internet, or simply as targeted advertising material posted through your door. The potential for individualised advertising has never been so great.
Another significant part of promotion involves branding, which may not necessarily yield more sales directly, but relates back to one of the preliminary purposes of marketing; getting customers to choose your product over those of your rivals.
Putting it into Practice
As previously mentioned every company is unique and will have different marketing needs. By using a mixture of the four P’s discussed above you can take a good view of your own marketing plan.