Nearly every company on the planet sets out with the main objective of making money. This is generally done by producing some form of product, or offering a service, and then charging people money for it.
Firstly, it is a very rare case where a business can offer a product or service that is genuinely unique and cannot be supplied by anybody 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 main tool used by modern organisations to draw potential customers to do business with them and not with their rivals. It is a very extensive topic that is influenced by a great number of internal and external variables, but when done right it can be the one business practice that can make or break a company. Any time spent on marketing will reap benefits, although spending this time efficiently can yield extraordinary results.
So where should you begin when constructing a marketing strategy for your own business? Well, every situation is different, and each company will have its own set of advantages and flaws 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 platform.
The Marketing Mix
The marketing mix was a phrase that was first coined during the 1950′s and is a phrase that is used to express the fundamental building blocks of any marketing strategy. It reflects the fact that marketing is not a straightforward, blunt-edged business technique, but rather a subtle balance of different aspects of business functions.
The term was later built upon to include the concept of “four P’s” that described the essential elements of the marketing mix. The formalisation of these P’s made it very clear for business managers and marketers to quickly relate the elements of marketing to the strengths of their own companies, and by doing so could very rapidly form a personalised and efficient marketing plan. The four P’s are Product, Price, Place and Promotion.
Nearly every segment in the modern market is reasonably competitive, especially conference production, where proper marketing choices can mean the success or failure of the company.
Product
Whilst every element of the marketing mix is a requirement, the “product” element mentioned as one of the four P’s is possibly the most critical of all. It describes the physical product or intangible service that your business will be offering, and at the end of the day it is the reason that buyers are going to spend money with you. If this element is not correctly managed then your company will find it hard to survive.
Many people do not think that marketing has any place to play when it comes to the physical product that your business is selling. In fact, the typical train of thought very often bears the exact opposite sentiment. Surely it should be the other way around – your production department creates a product for sale and then it is the job of the marketing department to discover ways to sell it, right? This is not necessarily the case.
Take the computer software market as an example. There are many well-known brands of both operating system and software application solutions in the marketplace already, and since the market is relatively well saturated it would be incredibly tough (and expensive) to “take on the big boys”.
Rather than developing an operating system and then attempting to craft a marketing strategy to take on the likes of Microsoft and Apple, it would be far more effective to look at what types of product are sought after in the current marketplace, and how viable it would be to produce and sell them.
Once your products have been designed and created it is still a vital skill to be able to objectively evaluate your own products to identify the reasons why a customer would buy your product rather than a competitors’. The skill is called product differentiation and forms one of the fundamental skills of the product part of the marketing mix cake.
Another form of this part of the marketing mix is called product variation and is typically used to either extend the lifecycle of a product currently in the market, or to make your brand new product attractive to as many consumers as possible. Once again, this technique can be applied at all stages of product development.
The car industry uses this approach very effectively by offering different 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 incredibly competitive marketplace.
As part of our own promotion method, our business thoroughly studied what exactly made our goods stand out from the masses.
“Product is paramount” is one of the main slogans applied within our event management business and tries to point out to all employees that we expect high quality manufacturing.
Price
Another important factor in the marketing mix concerns the price of your products or services. This is not a simple case of carrying out market research to figure out the highest price that your customers would pay (although that can be a useful tool to use), but rather making use of the price of your products as a strategic tool designed to achieve any specific goals your business has. The potential advantages of an effective pricing plan are surprisingly large!
Although it may seem obvious, it’s still worth pointing out that price has always been, and probably always will be, one of the crucial factors that customers take into account when they are making a purchase. It is also worth noting that customers don’t constantly consider the lowest price to be the best price.
There are many questions that you need to ask yourself when devising a good pricing strategy, key among which are the price sensitivity of your customers, what your rivals are doing and how can pricing maximise your own profits. From a strategy point of view though, pricing can be covered by two primary principals; price skimming and penetration pricing. These are outlined below.
Price skimming
The main idea behind price skimming is to make as much money as possible from the segment of the market which is price-insensitive and are going to be willing to spend a large 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. Makers 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 monetary benefits can be made long into the future. It can be a high risk strategy, but when used correctly it can create revenue streams for many years to come.
Another thing to bear 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 undertake. So it is even more essential to get your pricing technique right.
Following using on-line tools to compare keyword search frequency we chose integrated washing machine to guide our campaign for online promotion as well as off-line.
Place
Place is the component of the marketing mix that is often overlooked by companies, but it is still a significant part of selling your product effectively. In a nutshell, it describes the method in which you provide your product to your customer, and subsequently how you receive money from them.
The most common ramifications of place-based marketing are the physical venues in which your products are sold. For the majority of consumer products, this includes the distribution infrastructure between your manufacturing plants and retailers or other outlets around the country. Since distribution of a physical product costs money it is important to identify your own priorities and alter your distribution network appropriately. This is the main use of this part of the marketing mix.
With the growing use of the Internet by your potential 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 place of contact (or even as a whole distribution channel in download-based markets such as MP3s) firms are now able to reach out to a huge pool of possible customers. Effective positioning of your product or service can therefore yield impressive financial results.
Promotion
When you say the word “marketing”, most people instantly think of the promotional side of the marketing mix, although as we have seen, this is merely one branch of a more complete system. Promotion can be used on a very individual basis or as a mass communication tool, and whilst it can be an expensive undertaking it is often an essential one. The key concern of promotion is to deliver a particular message that will improve sales.
Advertising is one of the most common forms of promotion. Classically it would be done by posting on billboards, producing short clips for TV and radio or by physically distributing 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 simply as targeted advertising material posted through your front door.
Another significant part of promotion involves branding, which may not necessarily yield more product sales directly, but goes back to one of the preliminary functions of marketing; getting customers to pick your product over those of your competitors.
Putting it into Practice
As previously mentioned every business is different and will have different marketing needs. By using a balance of the four P’s discussed above you can take a good view of your own marketing strategy.