Introduction to Marketing Mix
Marketing Mix can be defined as a set of marketing tools and tactics to promote products and services. American Marketing Association created the concept of Marketing Mix in the 1950s to explain how marketers make decisions regarding how they execute a successful marketing plan. Traditionally, in marketing mix, marketers considers 4 Ps of Marketing;
- Price
- Product
- Place
- Promotion
Marketing mix assists the marketing function in strategy making. It helps to make sure that a company can offer the right product to its customer, at the right time, at the right place for the right price. Marketing mix has a huge strategic importance as it covers the four most basic and essential elements.
Importance of Marketing Mix
- Marketing mix is a major tool for planning, developing and executing marketing strategies.
- It helps in bringing efficiency in utilizing the available resources within the organization. Marketing mix helps in proper utilization of funds and investment and also helps in making effective cost decisions.
- Marketing mix helps in prioritizing the needs of price, product, promotion and place according to the need and demand of customers.
- It helps in decision making through proper analysis of the demand of the product, existing competing and future potential.
- Marketing mix also acts as a corrective tool for price, product, place and promotion. Marketing managers/strategy makers thoroughly consider the marketing mix elements before making any decisions.
- The existing product might have some loose end in terms of pricing, product placement, product quality and promotion related approach. Marketing mix helps in product and service differentiation.
- Marketing mix helps in new product development, formulating the strategy for a new idea or a product from the scratch.
Elements of Marketing Mix
There are 4 elements in traditional Marketing Mix:
- Product
- Price
- Place, and
- Promotion
Product
It is any commodity or service offered by the company to its customers. Product in marketing mix includes the existing product as well as newly developed products. Marketers consider all the physical attributes of the product along with the offering from their competitors. Marketing mix as a tool works on making the products marketable by developing a strong product which is sellable in the market. For this, marketers differentiate its products from its competitors or develop products that fulfill the demand of the customers or fills the market gap. The attributes that is considered for a product;
- Variety
- Quality
- Design
- Brand name
- Features
- Packaging
Price
It is another element of marketing mix and also one of the most sensitive elements to customers. Price can be defined as the amount or monetary value, a customer is willing to pay for the product or service. Price element determines the profit that can be generated by the company.
Customers are sensitive to the price. The product and price determined for the product should match the expectation of the customers for the product to work in a market. To most of the customers, price signifies value for which they are spending their money.
Place
The decision of place for a company basically determines how a company should deliver the product i.e. mode of their operation. A quality product at reasonable price means nothing, when it is not available in the demanded market. Place includes the distribution system, logistics, warehouse and inventory decisions.
Place includes if the product will be sold directly by the company through stores or it will adapt retail and wholesale store system or go for franchise or it will have online selling. Similarly, place include all the in-between processes that bridges products to its customers.
Promotion
Promotion consists of all the activities that a company or marketer adopts to make customers and potential customers aware of the products in the market. Advertising, direct marketing, sales promotion, personal selling, telemarketing, digital marketing etc. are all the forms of promotion. Sponsorship, celebrity endorsement, billboards, TV commercials, radio jingles, print ad promotions etc. are efforts to promote.
Promotion is concerned regarding how a product/ service is marketed in the market, how people are going to perceive the product and how much audience has been served and how often the promotion should be conducted.
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