4P's Of marketing

Marketing’s Four P’s:

First Steps for New Entrepreneurs

Marketing your business is about how you position it to satisfy
your market’s needs. There are four critical elements in
marketing your products and business. They are the four P’s
of marketing.


1. Product. The right product to satisfy the needs of
your target customer.


2. Price. The right product offered at the right price.


3. Place. The right product at the right price available
in the right place to be bought by customers.


4. Promotion. Informing potential customers of the
availability of the product, its price and its place.



Each of the four P’s is a variable you control in creating the
marketing mix that will attract customers to your business.
Your marketing mix should be something you pay careful
attention to because the success of your business depends on
it. As a business manager, you determine how to use these
variables to achieve your profit potential. This publication
introduces the four P’s of marketing and includes worksheets
that will help you determine the most effective marketing mix
for your business

Product

“Product” refers to the goods and services you offer to your
customers. Apart from the physical product itself, there are
elements associated with your product that customers may be
attracted to, such as the way it is packaged. Other product
attributes include quality, features, options, services, warranties,
and brand name. Thus, you might think of what you
offer as a bundle of goods and services. Your product’s
appearance, function, and support make up what the customer
is actually buying. Successful managers pay close attention to
the needs their product bundles address for customers.
Your product bundle should meet the needs of a particular
target market. For example, a luxury product should create
just the right image for “customers who have everything,”
while many basic products must be positioned for priceconscious
consumers. Other important aspects of product may
include an appropriate product range, design, warranties, or a
brand name.
Customer research is a key element in building an effective
marketing mix. Your knowledge of your target market and
your competitors will allow you to offer a product that will
appeal to customers and avoid costly mistakes.

Price

“Price” refers to how much you charge for your product or
service. Determining your product’s price can be tricky and
even frightening. Many small business owners feel they must
absolutely have the lowest price around. So they begin their
business by creating an impression of bargain pricing.
However, this may be a signal of low quality and not part of
the image you want to portray. Your pricing approach should
reflect the appropriate positioning of your product in the
market and result in a price that covers your cost per item and
includes a profit margin. The result should neither be greedy
nor timid. The former will price you out of the market;
pricing too low will make it impossible to grow.
As a manager, you can follow a number of alternative pricing
strategies. In the next column are eight common pricing
strategies. Some price decisions may involve complex
calculation methods, while others are intuitive judgments.
Your selection of a pricing strategy should be based on your
product, customer demand, the competitive environment,
and the other products you will offer.

Place

“Place” refers to the distribution channels used to get your
product to your customers. What your product is will greatly
influence how you distribute it. If, for example, you own a
small retail store or offer a service to your local community,
then you are at the end of the distribution chain, and so you
will be supplying directly to the customer. Businesses that
create or assemble a product will have two options: selling
directly to consumers or selling to a vendor.



Direct Sales

As a producer, you must decide if supplying direct is appropriate
for your product, whether it be sales through retail, doorto-door,
mail order, e-commerce, on-site, or some other
method. An advantage of direct sales would be the contact you
gain by meeting customers face to face. With this contact you
can easily detect market changes that occur and adapt to
them. You also have complete control over your product
range, how it is sold, and at what price.
Direct sales may be a good place to start when the supply of
your product is limited or seasonal. For example, direct sales
for many home-produced products can occur through homebased
sales, markets, and stands.
However, direct sales require that you have an effective retail
interface with your customers, which may be in person or
electronic. If developing and maintaining this retail interface
is not of interest to you or you are not good at it, you should
consider selling through an intermediary.


Reseller Sales (Sales Through
an Intermediary)

Instead of selling directly to the consumer, you may decide to
sell through an intermediary such as a wholesaler or retailer
who will resell your product. Doing this may provide you with
a wider distribution than selling direct while decreasing the
pressure of managing your own distribution system. Additionally,
you may also reduce the storage space necessary for
inventory. One of the most important reasons for selling
through an intermediary is access to customers. In many
situations, wholesalers and retailers have customer connections
that would not be possible to obtain on your own.

Promotion

“Promotion” refers to the advertising and selling part of
marketing. It is how you let people know what you’ve got for
sale. The purpose of promotion is to get people to understand
what your product is, what they can use it for, and why they
should want it. You want the customers who are looking for a
product to know that your product satisfies their needs.
To be effective, your promotional efforts should contain a
clear message targeted to a specific audience reached via an
appropriate channel. Your target audience will be the people
who use or influence the purchase of your product. You
should focus your market research efforts on identifying these
individuals. Your message must be consistent with your
overall marketing image, get your target audience’s attention,
and elicit the response you desire, whether it is to purchase
your product or to form an opinion. The channel you select
for your message will likely involve use of a few key marketing
channels. Promotion may involve advertising, public
relations, personal selling, and sales promotions.