Marketing Mix

Marketing mix (Price, Place,
Promotion, Product)
When marketing their products firms need to
create a successful mix of:
the right product
sold at the right price
in the right place
using the most suitable promotion.
To create the right marketing mix, businesses have
to meet the following conditions:
The product has to have the right features - for
example, it must look good and work well.
The price must be right. Consumer will need to buy
in large numbers to produce a healthy profit.
The goods must be in the right place at the right
time. Making sure that the goods arrive when and
where they are wanted is an important operation.
The target group needs to be made aware of the
existence and availability of the product through
promotion. Successful promotion helps a firm to
spread costs over a larger output.
For example, a company like Kellogg's is constantly
developing new breakfast cereals - the product
element is the new product itself, getting the
price right involves examining customer perceptions
and rival products as well as costs of manufacture,
promotion involves engaging in a range of
promotional activities e.g. competitions, product
tasting etc, and place involves using the best
possible channels of distribution such as leading
supermarket chains.The product is the central point
on which marketing energy must focus. Finding out
how to make the product, setting up the
production line, providing the finance and
manufacturing the product are not the
responsibility of the marketing function. However,
it is concerned with what the product means to the
customer. Marketing therefore plays a key role in
determining such aspects as:
the appearance of the product - in line with the
requirements of the market
the function of the product - products must
address the needs of customers as identified
through market research.
The product range and how it is used is a function
of the marketing mix. The range may be broadened
or a brand may be extended for tactical reasons,
such as matching competition or catering for
seasonal fluctuations. Alternatively, a product may
be repositioned to make it more acceptable for a
new group of consumers as part of a long-term
plan.
The price
Of all the aspects of the marketing mix, price is
the one, which creates sales revenue - all the
others are costs. The price of an item is clearly an
important determinant of the value of sales made.
In theory, price is really determined by the
discovery of what customers perceive is the value
of the item on sale. Researching consumers'
opinions about pricing is important as it indicates
how they value what they are looking for as well as
what they want to pay. An organisation's pricing
policy will vary according to time and
circumstances. Crudely speaking, the value of
water in the Lake District will be considerably
different from the value of water in the desert.
The place
Although figures vary widely from product to
product, roughly a fifth of the cost of a product
goes on getting it to the customer. 'Place' is
concerned with various methods of transporting
and storing goods, and then making them available
for the customer. Getting the right product to
the right place at the right time involves the
distribution system. The choice of distribution
method will depend on a variety of circumstances.
It will be more convenient for some manufacturers
to sell to wholesalers who then sell to retailers,
while others will prefer to sell directly to retailers
or customers.
The promotion
Promotion is the business of communicating with
customers. It will provide information that will
assist them in making a decision to purchase a
product or service. The razzmatazz, pace and
creativity of some promotional activities are almost
alien to normal business activities.
The cost associated with promotion or advertising
goods and services often represents a sizeable
proportion of the overall cost of producing an item.
However, successful promotion increases sales so
that advertising and other costs are spread over a
larger output. Though increased promotional
activity is often a sign of a response to a problem
such as competitive activity, it enables an
organisation to develop and build up a succession of
messages and can be extremely cost-effective.