Price refers to the amount of money charged for a product or service. Determining the price of the product is a very crucial part as it is one of the most important factors that affect the consumer’s buying decision. “Companies often make their pricing decisions first and then base other marketing-mix decisions on the prices they want to charge. Here, price is a crucial product positioning factor that defines the product’s market, competition, and design.” (Kotler, 1994, p.349)
Pricing is the element that can be varied easily, giving it a successful advantage.
Promotion refers to the activities that broadcast the product or service to target consumers with an aim of persuading them to buy. Advertising, word-of-mouth promotion, public relations are common ways for promoting a product. Promotion creates awareness of the product and the company brand, and encourages consumers to purchase the product.
Place refers to ways in which customers can obtain the product or receive the service being offered, such as in retail stores or through the mail. The more options through which your service or product can be available to your customers, the greater the effect on your sales.
The marketing mix is a very useful guideline for understanding the basic principles of what makes an effective marketing campaign. It has been very influential in the development of the marketing theory and practices. Its greatest strength is its simplicity and the ease of understanding it. However, many people say that this can be a disadvantage because it is too simple and not broad enough.
The theory was developed in the 1960s and marketing practices have evolved since then, one being the increasing number of services available. Some marketing theorists argue that because there are more services, the marketing mix is restricted. They view the theory as being too product-orientated and markets are nowadays more customer-orientated, and so the theory does not fit to all the requirements of the marketing concept of the 21st Century. A need for a new marketing mix for a service-orientated firm was identified, which led to an extension of the 4Ps to the 7Ps by Booms and Bitner. They took the original 4Ps and included participants, physical evidence and process. This extension has been favoured by many and has out-dated the 4Ps model.
The marketing mix model was originally designed for packaged goods marketing but is now becoming too confined for a company involved in interactions with customers. The model does not include any interactive elements, giving it a weakness in the 21st Century. “Personal contacts are rarely discussed and even then only in the context of sales person-consumer interaction, where the mass marketing approach is insufficient.” (Rafiq et al, 1995, p.4)
Marketing is advancing in the direction where the marketing mix is irrelevant. The marketing mix of the 1960s is no longer applicable in the 21st Century. There has been a major power shift from firms to consumers in the past decade. “Today, the customer has the power…Thus, the marketer must shift from a ‘supply’ model that has been dictated by the 4Ps to a ‘demand’ model that will encourage customer ‘votes’ in terms of sales and ongoing relationships.” (Dev et al, 2005, p.4)
Some say that the 4Ps represent an oversimplified theory of Borden’s original twelve element concept, which McCarthy may have misunderstood when he formulated his simple 4Ps concept.
The 4Ps nevertheless, became a universal marketing theory which had a huge impact on marketing practices. The ultimate strength of the model was its simplicity and ease of understanding. However, it was though to be oversimplified and not detailed enough. The lack of service aspects of marketing was also a weakness.
Overall, the 4Ps have provided companies with a valuable framework of marketing and was empowering for the past decade. However, “the time has come to build on that foundation with a next-generation marketing mix that will help businesses create and capture value within the realities of the 21st Century marketplace.” (Dev et al, 2005, p.7)
Bibliography
Brassington, F., Pettitt, S. (2005), Essentials of Marketing, Pearson Education
Constantinides, E. (2006), ‘The Marketing Mix Revisited: Towards the 21st Century Marketing’, The Journal of Marketing Management, Volume 22, Pages 407-438
Dev, C,S., Schultz, D, E. (2005), ‘In the Mix: A Customer-Focused Approach Can Bring The Current Marketing Mix Into The 21st Century’, Marketing Management, Volume 14, Pages 1-7
Dibb, S., Simkin, L., Pride, W,M., Ferrell, O,C. (1994), Marketing Concepts and Strategies, 2nd European Edition, Houghton Mifflin Company
Kotler, P., Armstrong, G. (1994), Principles of Marketing, 6th Edition, Prentice-Hall Inc.
Moller, K. (2006), ‘Comment On: The Marketing Mix Revisited: Towards The 21st Century Marketing by E.Constantinides’, The Journal of Marketing Management, Volume 22, Pages 439-450
Rafiq, M., Ahmed, P,K. (1995), ‘Using The 4Ps As A Generic Marketing Mix’, Marketing Intelligence and Planning, Volume 13, Pages 4-15