Nearly every business on the planet sets out with the main objective of earning money. This is usually done by producing some form of product, or offering a service, and then charging people money for it. This fundamental theory is fairly straight-forward, although it contains many specific details.
First of all, it is a very rare case that a company can offer a product or service that is truly unique and cannot be supplied by anyone else. This means that your enterprise will be competing with other businesses that sell a similar item and you will both be trying to earn money from the same customers, who only want to spend their cash once.
Marketing is the primary tool used by modern businesses to draw potential customers to do business with them and not with their competitors. It is a very extensive topic that is affected by a great deal of internal and external variables, but when done well it can be the single business practice that could make or break a corporation.
So where should you begin when constructing a marketing strategy for your own company? Well, each situation is different, and every company will have its own set of strengths and weaknesses that must be taken into consideration, but there is a marketing rule that can be applied to almost any company to be used as a marketing framework.
The Marketing Mix
The marketing mix was a phrase that was first coined in the 1950’s and is an expression that is used to express the fundamental building blocks of any marketing strategy. It reflects the fact that marketing is not a simple, blunt-edged business tool, but rather a delicate balance of different elements of business functions. It got its name because it is similar to the ingredients list for a recipe.
The term was later developed to include the concept of “four P’s” that described the critical elements of the marketing mix. The formalisation of these P’s made it very clear for company managers and marketers to swiftly relate the elements of marketing to the strengths of their own companies, and by doing so could very quickly form a customised and effective marketing strategy.The four P’s are Product, Price, Place and Promotion.
This marketing model is not restricted to physical items, services such as Nottingham planning consultants services could gain from fresh marketing ideas or a new point of view.
Product
Although every aspect of the marketing mix is a necessity, the “product” element mentioned as one of the four P’s is possibly the most crucial of all. It identifies the physical product or intangible service that your business will be selling, and at the end of the day it is the reason that customers are going to spend money with you. If this element is not correctly managed then your organisation will find it hard to make it through.
Several people don’t think that marketing has any place to play when it comes to the physical product that your business is selling. In fact, the common train of thought very often bears the precise opposite sentiment. Surely it should be the opposite way around - your production department creates an item for sale and then it is the task of the marketing department to find ways to sell it, right?
Consider the computer software market as an example. There are many established brands of both operating system and software application products on the market already, and since the market is relatively well saturated it would be very tough (and expensive) to “take on the big boys”. So how can the principles of the marketing mix help in this circumstance?
Rather than developing an operating system and then attempting to craft a marketing strategy to rival the likes of Microsoft and Apple, it would be more effective to look at what types of product are desired in the current marketplace, and how feasible it would be to manufacture and sell them. By being aware of the marketing mix early on in your product development cycle you can prevent business dead-ends at a later stage.
Once your products have been fashioned and created it is still a critical skill to be able to objectively evaluate your own products to recognise the reasons why a customer should buy your product rather than a competitors’. The skill is called product differentiation and forms one of the basic skills of the product part of the marketing mix pie.
Another form of this part of the marketing mix is known as product variation and is generally used to either extend the lifecycle of a product already in the market, or to make your brand new product attractive to as many consumers as possible.
The motor industry uses this approach very effectively by offering various engines, trim packages and interior options with the cars that they offer. They use the marketing mix to good effect to sell their own products in an extremely competitive marketplace. Although these companies may have substantial marketing budgets, the same concepts can be applied to all companies.
It might seem evident that marketing is incredibly significant to any company such as ours, although particular ideas still need to be put into practice, which isn’t always easy.
Price
Another important factor in the marketing mix relates to the price of your products or services. This isn’t a simple case of carrying out market research to determine the highest price that your customers would spend (although that can be a useful tool to use), but rather using the price of your products as a strategic tool designed to achieve any particular targets your business has. The potential benefits of an effective pricing strategy are surprisingly substantial!
Whilst it may seem obvious, it’s still worth noting that price has always been, and likely always will be, one of the crucial factors that shoppers take into account when they are making a purchase. It is also worth noting that customers don’t always consider the cheapest price to be the best price.
There are many questions that you need to ask yourself while devising a good pricing plan, key amongst which are the price sensitivity of your clients, what your competitors are doing and how can pricing maximise your own profits. From a strategy point of view however, pricing can be covered by two main principals; price skimming and penetration pricing. These are outlined below.
Price skimming
The main idea driving price skimming is to make as much cash as possible from the sector of the market which is price-insensitive and will be willing to spend a premium amount of money to get a product or service early on.
This pricing strategy is frequently used in the consumer electronics industry where customers will often eagerly await the launch of a new mobile phone or computer games console. Manufacturers could set nearly any price they wanted to and there would still be a loyal core of customers that would pay it.
Penetration pricing
Penetration pricing is at the other end of the pricing spectrum, and is tailored towards gaining a large market share at a short-term cost so that financial benefits can be earned long into the future. It can be a risky strategy, but when employed correctly it can create revenue streams for many years to come. When setting a price for penetration it is still essential to not give a poor impression of your product by aiming for too low a figure.
Another thing to keep in mind is that “price” is the only part of the marketing mix that will generate revenue for a business. The other members of the four P’s will all cost money to produce or carry out.
To optimise our website for google marketing we chose electric radiators UK as an aimed phrase because it relates to our business and what we offer.
Place
Place is the component of the marketing mix that’s often overlooked by companies, but it is still a significant part of selling your product effectively. In short, it describes the method in which you provide your product to your customer, and subsequently how you collect money from them. It can be a fantastic marketing approach when used correctly.
The most common implications of place-based marketing are the physical venues in which your products are sold. For the majority of consumer products, this involves the distribution network between your manufacturing centres and shops and other outlets around the country. Since distribution of a physical product costs money it is crucial to identify your own priorities and alter your distribution network appropriately. This is the primary use of this element of the marketing mix.
With the growing use of the Internet by your prospective customers, marketing techniques have had to take into account how they use the Internet to help distribute their products. By using the Internet as a point of contact (or even as an entire distribution route in download-based markets such as MP3s) companies are now able to reach out to a huge pool of potential customers.
Promotion
When you say the word “marketing”, many people immediately think of the promotional side of the marketing mix, although as we have seen, this is only one branch of a more complete system. Promotion can be used on a very individual basis or as a mass communication instrument, and whilst it might be an expensive undertaking it is often an important one. The key concern of promotion is to deliver a particular message that will boost sales.
Advertising is one of the most typical forms of promotion. Classically it would be done by posting on billboards, creating short clips for TV and radio or by physically handing out flyers or leaflets to potential customers. With the coming of the information age we have witnessed a great increase in promotion via e-mail and the Internet, or just as targeted advertising materials posted through your door.
Another significant part of promotion involves branding, which will not necessarily yield more product sales directly, but relates back to one of the preliminary functions of marketing; getting customers to choose your product over those of your rivals.
Putting it into Practice
As previously mentioned each business is different and will have different marketing needs. By using a mixture of the four P’s reviewed above you can take an effective view of your own marketing strategy.
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