Marketing Strategy Theory: Four P's

Marketing is a method for companies to promote their products and services (Constantinides, 2006). Companies manage their marketing strategy using different tactics. Nevertheless, the four principal categories, also known as the theory of four Ps of marketing, include the price, promotion, product, and place (Khan, 2014). Hence, a marketing mix is a number of strategies that businesses adopt to promote their goods in the market (Constantinides, 2006). The tactics appeared in the 1940s and demonstrated their effectiveness. However, certain marketing managers and individuals connect these tools with expensive challenges. Therefore, it is essential to understand the strengths and weaknesses of these strategies and how they help in the market before making any generalized conclusion about their practicality.

This paper discusses the concept of the marketing mix, how it affects various groups including managers, individuals, and organizations, their pros and cons, and applies the concept to live experiences. The primary purpose of the marketing mix is to ensure development and successful marketing strategy. In other words, the attempt is to satisfy both sellers and customers through this tool. Although the idea of marketing mix has received some critics, when a marketer properly understands and utilizes it, it is a key factor in products’ success.

Development of the Marketing Mix

The idea of marketing mix emerged in the 1940s and has developed overtime. The concept continued to gain popularity until the 1960s when Neil Borden, published the first book on marketing mix. Borden developed the idea of marketing mix in his article titled “The Concept of Marketing Mix” in 1964 (Hoffmann, 2008). The article outlined various marketing ingredients including but not limited to product, branding, distribution, advertising, price, planning, packaging, promotion, and personal selling. Sometimes later, Jerome McCarthy categorized the items into four top-level groups currently called the marketing mix including product, price, place, and promotion (Hoffmann, 2008; Levy, 2011). A combination of these items helps to create marketing tactics and strategies.

A product is meant to fulfill specific customer demand or need (Hoffmann, 2008). An organization first identifies and understands the prospective buyers before designing the product and setting the price. Levy (2011) defines price as the actual amount that the product buyer pays for a particular product. The level of price determines how the product sells. Organizations base the product price on various factors including customer’s perceived value of product or service. For example, customers perceive McDonald’s food and beverages as of high value. As such, the enterprise high prices for its items but still get buyers As such, it is imperative for marketers to understand how customers view or see the product.

Promotion refers to marketing communication techniques through which a marketer notifies the target customers about the availability and price of a particular product (Hoffmann, 2008). Different strategies have emerged including sales promotions, public relations, special offers, and advertising among others that a company can use. Most companies prefer advertising using television or print media. Nonetheless, whatever the channel an organization uses, it is important to ensure that it is suitable for a particular product and the customer to which the product is being marketed. The aspect of place or distribution in a marketing mix involves how a given product is delivered to customers (Constantinides, 2006). A company first assesses channels that are suitable for a particular product and then adopt them.

Pros and Cons of Marketing Mix

Price

Price helps companies to gain competitive advantage. According to Levy (2011), enterprises offer commodities at low prices in order to attract buyers from competitors. In turn, the company increases its sales volume. Marketers also set high prices to create a high-quality image for their businesses. From Levy’s (2011) point of view, price skimming helps to draw buyers by creating a perception that their commodities are of higher quality than those offered by competitors.

However, product price is associated with various challenges. Firstly, indicating price tags creates room for competitors to bring out cheaper products and take customers (Levy, 2011). It is important to bear in mind that not every firm can afford to offer commodities at low prices and still survive in the market. Therefore, showing prices of products might lower sales. Moreover, setting low priced goods and services might create a negative perception of the products to customers. In such case, it would be hard to configure the value of the commodity because expensive goods or services might make customers shift to firms that offer similar but affordable products or force them away to enterprises that sell such items at higher prices because the customers perceive them as of higher quality than those sold at lower prices. These scenarios make it hard for a marketer to choose the appropriate price in the product mix.

Promotion

Promotion helps a firm to reach and inform prospective customers about the availability, quality, and prices of particular products. Constantinides (2006) maintained that public relations approach is a convenient way of reaching many potential customers, especially if the publicity is attained through a proper media. In other words, promotion makes customers perceive products as valuable since the message comes directly from sellers.

However, promotions might make an organization lose command of a particular market or commodity (Constantinides, 2006). Firstly, the marketer cannot predetermine who receives the message and comments about the good or service. Indeed, promotion leads to competitors accessing the item and creating better ones using the same idea. In such case, the original manufacturer will lose the market regardless of whether the good or service is copyrighted or not (Constantinides, 2006). Moreover, promotion is expensive. For example, the company has to employee people to conduct the promotion campaign or direct others from their daily activities to engage in promotion campaign. In turn, this might interfere with production. Enterprises are also forced to sell products at higher prices to compensate the promotion cost. Unfortunately, this might lower sales and lead to a loss.

Place

Place (or location) in a marketing mix refers to methods used to deliver products and regions where it will be sold (Constantinides, 2006). Having a definite place helps marketers to get more personal feel of the market because they deal directly with customers. Targeting definite places further helps to reach as many buyers as possible and get return clients. Constantinides (2006) affirms that distributing products to predetermined locations helps marketers to understand the needs of buyers and convince them to buy regularly.

However, focusing on select locations restrains organizations to a few customers. a particular region can get saturated with similar goods and services thus forcing the company to lower its prices. Focusing on particular place also reduces sales by denying the organizations opportunities of meeting new potential buyers. As such, the firm should target many markets in order to increase sales and sell at reasonable prices especially in areas visited for the first time.

Product

Product in market mix involves managers focusing on items that the organizations will offer in the market (Constantinides, 2006). This approach helps to target specific customers and meet their needs through renovation of the product. For example, Coca-Cola’s soft drinks contribute to a significant market share, thus calling for improvement of the quality of its drinks. Concentrating on a single product line rather than a wide range of items also enhances innovativeness and creativity thus attracting more customers. However, offering a few selective goods or services might be risky. Constantinides (2006) suggests enterprises to diversify their operations by offering different goods and services. Such strategy can help the company to shift quickly from one line of sell to another incase one item become less profitable.

How the 4P’s Help the Market

The market competition virtually for all types of services and products is becoming intensive thus forcing marketing departments to be more responsible (Constantinides, 2006). Enterprise such as McDonald’s have benefitted from marketing mix. That is, despite operating in a competitive fast food industry, appropriate use of the 4Ps of marketing has helped the company to stay competitive in the market. Constantinides (2006) affirms that marketing mix is an integral tool in developing and implementing an efficient marketing strategy. Product plays a crucial role in informing prospective customers about the product a company offers. Customers are aware of various beverages and food that MacDonald’s offers. As such, buyers do not go to other firms because they know what is available at MacDonald’s and what they need to get elsewhere.

An organization should also specify to customers where they can get the goods and services. An organization can direct customers to buy the items from kiosks, restaurants, or supermarkets. For example, MacDonald’s directs its customers to mobile apps, postmates websites, and restaurants among other avenues. Such information saves customers time they would waste looking for particular products in different places.

Price is also an important element in marketing. According to Constantinides (2006), price helps a company to distinguish itself in the market in case there are various enterprises that offer similar products or services. A company can offer discounts for goods and services or even sell at lower prices. Such approach makes customers purchase commodities they might not initially be willing to buy. MacDonald’s use both discounts and low prices thus it has been able to maintain its competitiveness in the industry. Finally, promotion activities guide marketers to identify appropriate media that will help to create awareness among target customer about the products or services. Most organizations prefer sales promotions to ensure customers taste the product at time it is being launched in the market. 

Conclusion

Despite some critics about the concept of marketing mix, when an organization properly understands, designs, and uses this approach, it assures products’ success. Marketing mix highlights various elements including promotion, product, place, and price on which marketers should focus. Although some marketing experts feel that pricing exposes firm competition and interfere with product value, customers purchase particular goods and services based on their awareness of the prices of the products offered. Expenditure is also inevitable in business. Therefore, the argument about the cost associated with different marketing strategies is not justifiable. In overall, the marketing is a critical framework if understood and implemented appropriately.

References

Constantinides, E. (2006). The marketing mix revisited: Towards the 21st century marketing. Journal of Marketing Management, 22(3-4), 407-438.

Hoffmann, S. (2008). Are the 4 P's of international marketing of equal importance to all firms? What factors might cause some to more or less important than others? A short article. München: GRIN Verlag GmbH.

Khan, M. T. (2014). The concept of marketing mix and its elements. International Journal of Information, Business, and Management, 6(2), 95-270.

Levy, K. (2011). Price; marketing's most delicate "P". Forbes, Nov 30, 2011. Retrieved from http://www.forbes.com/sites/keithlevy/2011/11/30/price-marketings-most-delicate-p/#72807aba1b97