The 4 Ps of the Marketing Mix
Traditionally a proposition (also called the Marketing Mix) can be defined using the four Ps (see also: https://en.wikipedia.org/wiki/Marketing_mix):
- Product: What are/should be the (in)tangible benefits of the product(s)? Do these benefits meet or outperform those of competitors? A product life cycle analysis can help to determine what new products should be introduced while other products may have to be removed out of the assortment.
- Price: For what price should the product(s) be offered? Should the product(s) be sold at a discount price or be moved towards the premium segment? If multiple products are offered, what should be the difference in price? What discount model should be offered (for example, what prices apply if the customer buys 5, 25 or 100 items)? An analysis of the price lists used by competitors helps to determine the price and so does a price elasticity study among customers.
- Promotion: Promotion covers the messages and the methods of communication used to attract, convert, close and delight costumers.
- Place: Where can the product be bought? This starts with the question whether the company wants to sell its product directly to the intended user or use the sales power of resellers/retailers. Next, the intensity needs to be determined. Various strategies exist, such as intensive distribution (selling everywhere), selective distribution (only to a limited set of resellers/retailers), exclusive distribution (only via one partner).
The proposition may differ per product and country as the external environment differs (other customer needs, other competitors, etcetera).
The 7 Ps of the Marketing Mix
Over the years the 4P model has been adopted in many different ways. The 7P model adds three additional aspects to make it more relevant for companies that offer a service and for retailers:
- Physical evidence: The evidence which shows that a service was performed, such as the delivery packaging. A great example is the way in which products can be packed (YYY). Some consumers even put their “unboxing” experiences online.
- People: The employees that actually sell, deliver, implement and offer after-sales services to clients. Where would you buy more frequently: a shop where the sales staff only sits behind the till to finalize the transaction or where a store associates helps you select the right product?
- Process: The processes and systems needed to offer the products and/or services.