Almost every business on the planet sets out with the primary objective of making money. This is generally done by manufacturing some form of product, or offering a service, and then charging people money for it. This fundamental principle is fairly straight-forward, although it contains many intricate details.

First of all, it is a very rare case that a business can offer a product or service that is genuinely unique and cannot be supplied by anybody else. This means that your company will be contesting 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 money once. So how can you boost the chances of them spending money with you?

Marketing is the main tool used by modern organisations to draw prospective customers to do business with them and not with their rivals. It is a very extensive topic that is influenced by a great number of internal and external variables, but when done well it can be the single business practice that can make or break a company.

So where should you begin when constructing a marketing strategy for your own business? Well, every situation is different, and every business will have its own set of strengths and flaws 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 in the 1950’s and is an expression that is used to express the fundamental building blocks of any marketing strategy. It demonstrates the fact that marketing is not a straightforward, blunt-edged business tool, but rather a subtle balance of different elements of business operations.

The term was later developed to include the idea of “four P’s” that described the essential elements of the marketing mix. The formalisation of these P’s made it very easy for company managers and marketers to swiftly associate the elements of marketing to the strengths of their own organisations, and by doing so could very rapidly create a tailored and effective marketing system.

Marketing is a worldwide business idea and could be applied to balloon decoration or almost any amount of other products and services.

Product

Although every element of the marketing mix is a necessity, the “product” element mentioned as one of the four P’s is possibly the most critical of all. It identifies the physical product or intangible service that your business will be selling, and at the end of the day it is the reason that customers are going to spend money with you.

Many people don’t think that marketing has any role to play when it comes to the actual product that your business is selling. In fact, the common train of thought very often bears the exact 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 discover ways to sell it, right? This is not necessarily the case.

Consider the computer software market as an example. There are many well-known brands of both operating system and software application solutions on the marketplace already, and since the market is relatively well saturated it would be very tough (and expensive) to “take on the big boys”. So how could the principles of the marketing mix help in this circumstance?

Rather than developing an operating system and then attempting to craft a marketing strategy to take on the likes of Microsoft and Apple, it would be far more effective to look at what sorts of product are sought after in the current marketplace, and how feasible it would be to manufacture and sell them.

Once your goods have been fashioned and created it is still a vital 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’. The skill is called product differentiation and forms one of the fundamental skills of the product part of the marketing mix pie.

A different form of this part of the marketing mix is called product variation and is typically 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. Again, this technique can be applied at all stages of product development.

The motor industry uses this technique very effectively by offering different engines, trim packages and interior options with the cars that they offer. They use the marketing mix to great effect to sell their own goods in an incredibly competitive marketplace. Whilst these companies may have huge marketing budgets, the same concepts can be applied to all businesses.

We do not have a defined birthday sashes marketing team in our company although several of our own managers have been able to take up marketing as part of their job function.

Price

Another important factor in the marketing mix relates to the price of your products or services. This isn’t a simple case of carrying out market research to figure out the highest price that your customers would spend (although that can be a handy tool to use), but rather making use of the price of your products as a strategic tool designed to achieve any specific goals your company has.

Although it may seem obvious, it is still worth pointing out that price has always been, and likely always will be, one of the key factors that shoppers take into account when they are making a purchase. It is also worth noting that customers do not constantly consider the lowest price to be the best price. In fact a price that is too low can often turn buyers away.
There are many questions that you need to ask yourself when devising a good pricing plan, key among which are the price sensitivity of your clients, what your rivals are doing and how can pricing maximise your own profits. From a strategy point of view though, pricing can be covered by two primary principals; price skimming and penetration pricing. These are outlined below.

Price skimming

The main idea behind price skimming is to make as much money as possible from the sector of the market which is price-insensitive and are going to be prepared to spend a premium amount of money to get a product or service early on.

This pricing technique is very often used in the consumer electronics market where customers will often eagerly await the launch of a new mobile phone or computer games console. Makers could set nearly any price they wanted to and there would still be a loyal base of customers that would pay it. By using 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 other 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 risky strategy, but when used correctly it can create revenue streams for many years to come. When setting a price for penetration it is still critical to not give a poor impression of your product by aiming for too low a figure.

Another thing to keep in mind is that “price” is the one part of the marketing mix that will generate income for a business. The other members of the four P’s will all cost money to produce or carry out. So it is even more vital to get your pricing technique right.

Before our corporation began researching on-line promotion hand waver didn’t seem to be the clear choice of keyword to use as our primary focus.

Place

Place is the portion of the marketing mix that’s often overlooked by companies, but it’s still an important part of selling your product effectively. In a nutshell, it describes the way in which you provide your product to your consumer, and consequently how you receive money from them. It can be a fantastic marketing technique when used appropriately.

The most common implications of place-based marketing are the physical venues in which your products are sold. For the majority of consumer products, this includes the distribution network between your manufacturing centres and shops or other outlets around the world. Since distribution of a physical product costs money it is crucial to identify your own priorities and modify your distribution network accordingly.

With the increasing use of the Internet by your prospective customers, marketing methods have had to consider 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 route in download-based markets such as MP3s) firms are now able to reach out to a huge pool of potential customers. Effective positioning of your product or service can therefore yield impressive economic results.

Promotion

When you mention the word “marketing”, most 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 can be an expensive undertaking it is often an important one. The primary concern of promotion is to deliver a certain message that will boost sales.

Advertising is one of the most common forms of promotion. Typically 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 coming of the information age we have witnessed a great increase in promotion via e-mail and the Internet, or simply as targeted advertising materials posted through your door. The potential for individualised advertising has never been so great.

Another significant part of promotion involves branding, which will not necessarily yield more product sales directly, but goes back to one of the initial 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 requirements. By using a balance of the four P’s reviewed above you can take an effective view of your own marketing plan.