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 customers money for it.
Firstly, it is a very rare case that a company can offer a product or service that is genuinely unique and cannot be supplied by anyone else. This means that your business will be contesting with other businesses that sell a similar product and you will both be trying to earn money from the same customers, who only want to spend their cash once. So how can you increase the chances of them spending money with you?
Marketing is the primary tool used by modern firms to draw potential customers to do business with them and not with their competitors. It is a very broad topic that is influenced by a great deal of internal and external factors, but when done right it can be the one 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 advantages and weaknesses that must be taken into consideration, but there is a marketing principle that can be applied to almost any company to be used as a marketing platform.
The Marketing Mix
The marketing mix was a term 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 simple, blunt-edged business tool, but rather a subtle balance of different elements of business operations.
The term was later built upon to include the idea of “four P’s” that described the critical elements of the marketing mix. The formalisation of these P’s made it very easy 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 personalised and efficient marketing plan.
This marketing style is not limited to tangible items, other services such as Nottingham planning consultants services may benefit via new marketing ideas or a new perspective.
Product
Although every aspect of the marketing mix is a requirement, the “product” element mentioned as one of the four P’s is perhaps the most critical of all. It describes 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.
Many people don’t think that marketing has any place to play when it comes to the actual product that your company is selling. In fact, the common train of thought very often bears the precise opposite sentiment. Surely it should be the other way around - your manufacturing department creates a product for sale and then it is the task of the marketing department to discover ways to sell it, right?
Consider the computer software market as an example. There are many established brands of both operating system as well as software application products on the marketplace already, and because the market is relatively well saturated it would be incredibly tough (and expensive) to “take on the big boys”.
Rather than creating an operating system and then attempting to craft a marketing strategy to take on the likes of Microsoft or Apple, it would be far more effective to look at what types of product are desired in the current marketplace, and how feasible it would be to produce and sell them.
Once your products have been designed and created it is still a critical skill to be able to objectively review your own products to identify the reasons that a customer would buy your product rather than a competitors’.
A different form of this part of the marketing mix is called product variation and is generally used to either prolong 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 different engines, trim packages and interior options with the cars that they sell. They use the marketing mix to great effect to sell their own products in an incredibly competitive marketplace. Whilst these companies may have huge marketing budgets, the same principles can be applied to all businesses.
“Product is paramount” is one of the slogans used in our business and aims to remind all staff that we expect high quality manufacturing.
Price
Another important factor in the marketing mix relates to the price of your products or services. This isn’t a simple case of performing 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 benefits of an effective pricing plan are surprisingly large!
Although it may seem obvious, it is still worth noting that price has always been, and likely always will be, one of the key factors that customers take into account when they are making a purchase. It is also worth noting that customers don’t always consider the lowest price to be the best price. In fact a price that is too low can sometimes turn buyers away.
There are many questions that you need to ask yourself while 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 however, pricing can be covered by two main principals; price skimming and penetration pricing.
Price skimming
The main idea driving price skimming is to make as much money as possible from the segment of the market which is price-insensitive and will be willing to spend a premium amount of money to receive a product or service early on.
This pricing technique is very often used in the consumer electronics market 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 base of customers that would pay it. By making use of this method as part of a pre-ordering strategy, a company can help to smooth its own money flow.
Penetration pricing
Penetration pricing is at the opposite 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 earned long into the future. It can be a high risk strategy, but when employed correctly it can create revenue streams for many years to come. When establishing a price for penetration it is still essential to not give a poor impression of your product by aiming for too low a number.
Yet another thing to bear in mind is that “price” is the one part of the marketing mix that will generate income for a business. The other members of the four P’s will all cost money to create or undertake. So it is even more essential to get your pricing technique right.
To optimise our website for google marketing we chose electrical apprenticeships as a targeted key phrase since it relates to our business and what we do.
Place
Place is the component of the marketing mix that’s often not addressed by companies, but it’s still an important part of selling your product successfully. In a nutshell, it describes the way in which you deliver your product to your consumer, and consequently how you collect money from them.
The most typical implications of place-based marketing are the physical locations in which your goods are sold. For the vast majority of consumer products, this involves the distribution infrastructure between your production plants and shops or other outlets around the country. Since distribution of a physical product costs money it is crucial to identify your own priorities and adapt your distribution network accordingly. This is the principal application of this element of the marketing mix.
With the growing use of the Internet by your prospective customers, marketing strategies have had to consider how they use the Internet to help distribute their products. By using the Internet as a place 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 large pool of potential customers. Effective placing of your product or service can therefore deliver impressive economic results.
Promotion
When you say the word “marketing”, many people immediately think of the promotional aspect 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.
Advertising is one of the most common forms of promotion. Typically 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 arrival of the information age we have seen a great increase in promotion via e-mail and the Internet, or just as targeted advertising materials posted through your front door. The potential for individualised advertising has never been so great.
Another significant part of promotion involves branding, which may not necessarily yield more sales directly, but goes back to one of the initial purposes of marketing; getting customers to pick your product over those of your rivals. When all other pieces of the marketing mix are equal it can be branding that swings a customer’s choice.
Putting it into Practice
As previously mentioned every company is unique and will have different marketing requirements. By using a balance of the four P’s reviewed above you can take an effective view of your own marketing strategy.
