Marketing a product is challenging in today’s world where competition is fierce, and competitors can move quickly. Nevertheless, the digital age has helped to reduce entry barriers by making it easier than ever before to learn about what is working for your competitors and similar businesses so that you can fine-tune your market positioning.
By doing enough research before getting started, you can set your business up for success by using a strategy that will be effective in the real world. Therefore, you should do extensive market research before investing time and money into bringing an offering to market. To stay on course for success, focus your research on answering how your offering should be positioned with respect to the 4 Ps of marketing.
What Are the 4 Ps of Marketing?
The 4 Ps of marketing were created by a researcher named Edmund Jerome McCarthy in the 1960s. At that time, marketing strategy was very different than it is today. All businesses could only compete in locations where they had a physical presence, and getting the data to determine the ideal pricing for a product was problematic. Nevertheless, the basic concepts of the 4 Ps remain as accurate today as they were when they were created. The 4 Ps of marketing are:
Product: Your product is what your business sells. Today, products are often services, and many products that people buy are intangible.
Price: The pricing you use for your products and services substantially impacts how customers perceive your brand. More expensive products are generally seen as superior offerings. Still, they have to live up to their price point for customers to become interested and for good online reviews to be earned.
Place: If you have an offline local business, the place is likely to be your most important marketing factor. However, a place can also be necessary for determining what jurisdiction your company should be located in. Choosing the right location can help your company to remain competitive through improved tax efficiency or greater resource availability. Furthermore, even online businesses have to be concerned with the place since they have to determine what channels to market and what platforms to use.
Promotion: The actual way that you communicate your offerings to customers is the final P of the marketing mix. Promotion involves the complete pipeline that leads to customers discovering your services, seeing a reason to buy, and making a purchase.
The four elements of marketing are constantly evolving, but they remain the backbone of marketing. If you want to create a profitable and sustainable business, it is crucial to get the 4 Ps right from your first day in business. In general, you can get the 4 Ps right by conducting sufficient research before getting started, learning from your competitors, and solving a genuinely unmet need in the marketplace.
Keep in mind that if you have an existing business, the 4 Ps are equally relevant for developing new offerings or fine-tuning your market positioning. Many existing companies have assets that make them uniquely capable of solving unique needs that appear in the marketplace. Many entrepreneurs have been able to convert a small business into a large enterprise by using the 4 Ps to constantly scan your target market for opportunities to apply their expertise toward solving new needs.
Marketers regard “product” to be the “first P” of marketing. Although the Ps of marketing arrangement is only essential in the classroom, it is true that the product you offer is ultimately crucial toward the success of any business. After all, customers ultimately want to buy something. If your offering is not very good or cannot be delivered reliably, you cannot expect to build a successful business.
As mentioned earlier, products are often services in today’s world. If you are selling business services, your offerings will likely be entirely digital and interpersonal. Although services were not as important when the 4 Ps of marketing were first created, they can still be grouped in the “product” category of the 4 Ps of marketing.
Additionally, keep in mind that the product you are offering also includes elements of your brand. For instance, if you are marketing a commodity, the “product” customers are ultimately buying maybe your brand’s reliability, the quality of your customer service, or the modes of payment that you offer. In other cases, customers may want to buy products that are sold by a person they trust. Therefore, your brand and the people in your company can be a critical element in any product.
In general, the best way to get your product offering right is to talk to customers in the marketplace. You need to ask yourself: What is the value of the product or service to the buyer? Listen carefully for mentions of what needs customers are currently unable to solve and ask other customers if they have the same problem. Eventually, you will find a product that you are uniquely capable of creating that has not yet found its way to market.
Price is the most straightforward P of marketing. Your pricing strategy determines how your business is positioned in the marketplace and whether customers perceive that they received good value from your offerings after making a purchase. Generally, if customers feel like what they bought was worth the price you charged, they will return to make another purchase. Therefore, pricing strategy is crucial when seeking to establish a brand since customers’ lifetime value must be considered when determining a price point. So, you need to ask yourself, What is the perceived value of your product or service?
The location where your offerings are sold is another crucial factor in determining marketability. Most traditional businesses that operate from a brick-and-mortar facility depend on a place to maintain a competitive advantage. In some cases, the place can be so important that what corner a business is located on at an intersection can differentiate between success or bankruptcy. In other industries, such as manufacturing and warehousing, it can be important to choose a location near major highways or railways.
The world is becoming more globalized, so national jurisdiction is often the most critical factor for today’s businesses. Many businesses are able to find a viable position in the marketplace by taking advantage of differences in tariffs, VAT rates, and income tax laws in various national jurisdictions. Other businesses can use place to gain an advantage through less expensive labor or greater availability of resources.
Recently, the concept of online businesses has transformed what place can mean. Today, many businesses conceptualize place in terms of what platforms they are using online. If you build your business around customers coming to your website, your website would be your place with respect to the 4 Ps of marketing. Other businesses are on social media channels or existing e-commerce platforms, such as Amazon or eBay.
The way that you promote your business determines what type of customers you attract. Ideally, your promotion strategy should aim to attract customers whose needs match your product, price, and location. When you get the other 3 Ps right, you can usually earn high margins from your promotions by selling offerings that customers truly value. Promotions can then focus on building customer lifetime value by maintaining customer relationships more effectively than your competitors.
Today, most promotions take place online. Promotions can range from search engine optimization to social media marketing. Promotions can also include word-of-mouth marketing and even the sales activities of your business to reach your target audience.
Over the years, the 4ps has evolved into the 7Ps: Product, Place, Price, Promotion, Physical Evidence, People, and Processes.
Published on: 2021-03-18
Updated on: 2021-03-31