A marketing mix is the set of marketing tools that a business uses to sell products or services to its target customers.
What Is Marketing Mix?
Businesses have technically always used marketing tools to promote and sell their work, but the term "marketing mix" was coined in the mid-20th century. One of its first uses was in a 1953 address to the American Marketing Association, in which Harvard professor and marketing expert Neil Bordon outlined how marketers develop and execute a successful marketing plan.
Identifying and arranging the elements of its marketing mix allows a business to make profitable marketing decisions at every level. These decisions help a business:
- Develop its strengths and limit its weaknesses
- Become more competitive and adaptable in its market
- Improve profitable collaboration between departments and partners
Since the 1950s, the elements of marketing mix have undergone various transformations in response to new technologies and other changes in marketing best practices.
The Four Ps of Marketing Mix
Since the 1960s, marketing mix as been associated with the four Ps: price, product, promotion, and place.
- Price. The cost to purchase a product. Price depends on the customer's perceived value of the product, and it can dramatically change your marketing strategy. A lower price makes a product accessible to more customers, while a higher price appeals to customers seeking exclusivity. Either way, the price must be greater than the cost of production so your business can make a profit.
- Product. What is being sold. Marketers must consider the life cycle of the product to address any challenges that may arise once it's in the hands of the consumer. For example, the earliest version of the iPod had a battery life problem that was only noticeable after a certain amount of time, and Apple needed to develop ways to combat that problem.
- Promotion. Advertising, direct marketing, and sales promotion. TV commercials, Internet ads, catalogs, trade fairs, billboards, and even ads on the top of taxi cabs are all types of promotion. This category also includes public relations, such as the distribution of press releases or ongoing relationships with the media. Promotion encompasses what is communicated, who it is communicated to, how that audience is reached, and how often promotion happens.
- Place. Any physical location where the customer can use, access, or purchase a product. This includes distribution centers, transport, warehousing, inventory decisions, and franchises.
The Seven Ps of the Marketing Mix
Sometimes, the four Ps are expanded to include the seven Ps. In addition to the usual four Ps, the seven Ps include physical evidence, people, and process.
- Physical evidence. Anything tangible related to a product or the physical environment in which a service takes place. Physical evidence may include product packaging, delivery receipts, signage, or the layout of a physical store.
- People. Employees, including those who interact directly with customers (such as sales, customer service, or delivery people) as well as staff recruitment and training. This category includes how well employees perform their jobs, how they appear to customers (for example, what their uniforms look like), and how customers feel about their experience.
- Process. Anything within the organization that has an impact on how a product or service is handled by employees and delivered to consumers. Some examples are the order in which employees must perform tasks, how many queries salespeople receive and where they direct customers for help, or how performance is tracked and measured. It also covers which parts of the process are standardized and which have room for customization on a per-customer basis.
What Is a Digital Marketing Mix?
A digital marketing mix is how a business achieves its marketing goals using digital technologies. As more business is done online, digital marketing tools become important to all types of businesses, not only those in the tech industry.
A digital marketing mix follows the same principles of a traditional marketing mix. However, those elements are adapted to the way the Internet influences new technologies and consumer behavior.
The Four Cs of a Marketing Mix
In the 1990s, the four Ps were adapted to the four Cs to place less focus on the business and more on the customer. The four Cs are consumer, cost, convenience, and communication. In some instances, the four Cs may be more applicable to a digital marketing mix than the four Ps.
- Consumer. The wants and needs of the consumer. Under this model, a business should be focused on solving problems for consumers rather than creating products. This requires studying consumer behavior and needs, along with interacting with potential customers to find out what they want.
- Cost. The total cost of acquiring a product or service, which goes beyond the price tag. Cost includes the time it takes to research a product and make a purchase. It also may include the cost of trade-offs that consumers must make, such as forgoing another purchase, or the cost of guilt they experience for buying or not buying a product.
- Convenience. How easy or difficult it is for consumers to find and purchase a product. The rise of Internet marketing and purchasing has made convenience more important in customer decisions than physical place.
- Communication. A dialogue that depends as much on the consumer as on the seller. This includes advertising, marketing, and media appearances. In the digital world, however, it also includes emails that customers either opt into or initiate, brand ambassadors, blog posts, websites, sponsored product placement, and social media channels.
How to Identify Your Marketing Mix
To bring in early sales and build a customer base, any business must begin by identifying its marketing mix. The first step in this process is identifying your target customer.
Once you know who your customer is, you can start to understand their relationship with your business.
- What problem does your target customer have?
- What is getting in the way of solving that problem?
- How does your product or service address that need?
- How does your target customer feel about your competitors? About you?
- What motivates your target customer to buy?
Next, identify your goals for sales and growth, as well as your budget for marketing initiatives. Then, choose a marketing tactic that will help you reach your target audience and achieve those goals.
For example, if you need 25 leads to sell one product, and you want to sell 1,000 products this month, then you need 25,000 new leads. You know your target customer reads and trusts two different websites, one with 25,000 visitors a month and one with one million visitors a month. The website with only 25,000 visitors a month is much less expensive to advertise on, but it is unlikely that all 25,000 visitors will become new leads. Therefore, the website with one million monthly visitors is a better use of your advertising budget, even if it is more expensive.
By working through the elements of your business' individual marketing mix, you'll be able to create a strategy that effectively reaches consumers, make sales, and grows your business.