One of the most famous and popular marketing concepts is the 4P (Pi) or marketing mix concept. This idea appeared in 1964, when Neil Borden published his article “The Marketing Mix Concept”, in which he tried to combine all the elements that should be taken into account when making a marketing plan for a company. Initially, such a plan contained a much larger number of points, but Nel managed to reduce their number to 4 and make them easier to remember.
The basic model includes: cost, product, place of sale and promotion. Let’s look at them in detail:
Product – Product.
Product is a product or service that a company offers to its customers (both potential and existing). This is the basis of the 4P concept, this is where you should start developing your marketing strategy.
Determine what functions your product will perform? What is its unique advantage? Determine how high quality your product will be? Different categories of consumers will measure quality differently, for example, one consumer cares that carrots are smooth and clean, while another judges quality by the region where the crop was harvested. Determine how wide the assortment will be, what will be the service for the end user.
Price – Price.
Price not only affects the profit that the company will make, but also the consumer’s perception of the product. If the assigned price is much higher or much lower than expected, it can negatively affect the purchase decision and reduce consumer confidence.
The company’s pricing policy determines in which price segment the product will be placed. This directly affects consumer perception. Price setting directly affects the market entry strategy.
Place- Place.
This component of the marketing mix looks at the distribution model of the product. The product must not only be in the right place, but also in the right time for the consumer to decide to buy it.
It is necessary to determine the geography of the product, the planned expansion into other markets and territories. Equally important are the channels through which the product will be distributed, it is necessary to provide for the rules of display, its size and penalties for dealers in case of violation of requirements. Determine how much product to keep in stock in case of force majeure.
Promotion.
This section includes all sorts of marketing communications. They can be aimed at both informing consumers about the products, creating or adjusting its image, and creating a need to purchase or re-purchase.
This section defines the desired promotion strategy (push or pull). The communication budget and the planned share of the brand’s voice in the total flow of advertising messages are defined. The result which is planned to be reached as a result of promotion is defined (it should be expressed in concrete figures, for example expected market share or increase of loyalty level by 10%).
