Marketing Mix and Explanation of 7P's

The marketing mix is a concept that encompasses various elements that businesses use to formulate their marketing strategies and meet customer needs.

What is the marketing mix?

The marketing mix is a concept that encompasses various elements that businesses use to formulate their marketing strategies and meet customer needs. Traditionally, the marketing mix consisted of the 4Ps : product, price, place, and promotion (McCarthy, 1960).

However, in recent years (Booms & Bitner, 1982) three additional elements have been added : People, Process and Physical Evidence, resulting in the 7Ps of marketing.

Explanation of 7P's :

1. Product :

It refers to what the company produces (whether it is a product or a service or a combination of both) and is developed to meet a customer's core need - for example, a transportation need is met by a car. The challenge is to create the right 'bundle of benefits' to meet this need. What happens as customer needs change, competitors move in, or new opportunities arise? We need to add to the 'bundle of benefits' to enhance the offering, create new versions of existing products or launch brand new products. Think beyond the actual product when enhancing the product offering – value can be added and differentiation achieved with guarantees, warranties, after-sales or online support, a user-friendly app or digital content like a video that helps the user to make the most out of the product.

2. Price :

Price is the value of the product or service delivered by the buyer to the seller. Since a customer is very sensitive about the price of a product, it is a crucial element in the marketing mix. A firm's slight change in the product's price can drive consumers towards a competitor's product. Therefore, price mix is an important decision and relates to pricing of a product or service. Decisions under price mix are related to the demand of the product, price of competitors etc.

While deciding the price of the product, the marketer should keep in mind some factors such as price objectives, product price, scope of competition in the market, customer's demand and purpose, government and legal regulations and marketing methods.

3. Place :

Also known as distribution, this element focuses on making the product available to customers at the right place and time. It involves decisions regarding distribution channels, logistics, inventory management, warehousing, and transportation. The goal is to ensure that customers can conveniently access the product.

4. Promotion :

Which includes activities undertaken by the marketer to communicate with the customers and distribution channels so they can enhance the sales of the firm. Through promotional communication, an organisation’s aim is to inform and persuade the customer to purchase the goods and inform him/her regarding the benefits of the product. Hence, Promotion Mix is an important decision and includes all decisions of an organisation related to the promotion of a sale of goods and services. Some of the important decisions under promotion mix are selecting a media to advertise the product, selecting promotional techniques, public relations, etc.

The four major elements of the promotion mix are Advertising, Sales Promotion, Personal Selling, and Public Relations.

i) Advertising : Advertising means promoting the idea of a product or service through a non-personal presentation by an identified sponsor. It is a paid form of promotional activity, and helps an organisation in connecting with the customers indirectly. The basic features of advertising are reach, choice, legitimacy, expressiveness, economy, and enhancing customer satisfaction.

ii) Sales Promotion : Sales Promotion is a short-term use of the incentives or other promotional activities of an organisation that helps in stimulating the customer in buying the product. Some of the sales promotion techniques used by organisations are refunds, discounts, rebates, gifts or premiums, samples, contests, usable benefits, etc.

iii) Personal Selling : As the name suggests, personal selling means selling products personally. It involves face-to-face communication and interaction between the buyer and the seller with the motive of sale. Personal selling does not mean influencing the buyer in purchasing what the seller is selling, but to provide satisfaction to the customer. Some of the basic features of personal selling are better response, personal interaction, relationships, etc.

iv) Public Relations : Public Relations means maintaining public relations with the public and by doing so, the organisations can create goodwill. According to the Chartered Institute of Public Relations, Public Relations is a strategic management function that adds value to an organisation by helping it to manage its reputation.

5. People :

Company people are at the forefront while interacting with customers, receiving and processing their enquiries, orders and complaints in person, through online chat, on social media or through a call centre. They interact with customers throughout their journey and become the 'face' of the organization to the customer. Their knowledge of the company's products and services and how to use them, their ability to access relevant information, and their daily approach and attitude should be optimized. Individuals may be volatile but with the right training, empowerment and motivation by an organization, they also represent an opportunity to differentiate an offering in a crowded market and build valuable relationships with customers.

6. Process :

All companies want to create a smooth, efficient and customer-friendly journey – and this cannot be achieved without the right processes behind the scenes to make this happen. Understanding the stages of the customer journey – from making an inquiry online to requesting information and making a purchase – helps us consider what processes should be in place to ensure the customer has a positive experience. When a customer makes an inquiry, how long should they wait before receiving a response? How long is the wait from booking a meeting with the sales team to when the meeting takes place? What happens after they order? How do we ensure reviews are generated after purchase? How can we use technology to make our processes more efficient? All of these considerations help build a positive customer experience.

7. Physical Evidence :

This element pertains to the tangible and intangible factors that influence the customer's perception of the product or service. It includes the physical environment, facilities, packaging, branding, and any other sensory elements that customers experience during their interaction with the product or service. Creating a positive and memorable customer experience is crucial.

Conclusion :

These 7Ps provide a comprehensive framework for businesses to develop effective marketing strategies. Each element plays a crucial role in understanding and meeting customer needs, creating value, and achieving business objectives. By considering all these aspects, businesses can create a holistic marketing mix that aligns with their target market and leads to successful outcomes.