Nothing explains a complicated business algorithm like a cute mnemonic device!
Hence the 4 Ps of marketing. This is one of the first things they drill into your head in business school. Actually, in any type of formal Marketing instruction. It’s everywhere, everyone knows it, and you need to know it too.
Let’s go, 4 Ps: Product! Place! Price! Promotion! Got that? Say it again (say it out loud – it helps.) Product! Price! Place! Promotion!
Once more, with feeling! Product! Place! Price! Promotion!
Never forget these four words – they are the key to your business success. Here’s how…
Each of the 4 Ps represents one of the really, really important elements of marketing that you need to consider when developing your campaigns. Alone, none of them will do you much good. The 4 P’s need to work together. They’re like the four wheels of a car, or the four legs of a table, or Charlie’s Angels without Bozley. If you’ve got trouble with or, (heaven forbid) are missing one entirely – you’ll have trouble getting anywhere.
So it’s easy right? Find a good product, slap a good price on it, sell it somewhere people go and throw together some promotion. Yes? No, because first you have to figure out how to define these things as “good”. It’s all about fit. Each of the 4 Ps has to be geared towards your specific target market, and work with each of the other 4 Ps to do so.
This is what you’re selling, be it a pot scrubber, e-book or car detailing service. But it’s not just the item or service itself that’s included in the Product P. It’s also the different varieties of your product, the quality of it, how it’s designed packaged and branded. Anything that adds value to your product, any reason a customer might want to purchase it is part of Product. Obviously, it’s pretty important.
You may be tempted to believe that the price of your product or service is merely the amount you charge customers when they purchase it. Dispel that notion immediately. The Price includes the retail price, any discounts or special offers, bonuses, payment plans, and credit terms. In short- anything even remotely related to money. It makes sense when you think about it: a discount lowers the price of an item. A bonus offer also lowers the price. Credit terms and payment plans make it easier for your customers to pay the Price. All of these must be considered.
This is what most people think of when they think of marketing. Promotion includes the advertising, the personal selling, sales promotions and public relations. Sponsoring your nephew’s little league game – that’s Promotion. Making a sales call? That’s Promotion. Handing out Brochures? That’s Promotion. Answering client emails? Still Promotion.
Place is also known as distribution. How do your clients get what they’ve paid for once they’ve paid for it? Is it delivered to their door? Is right there in a retail location? Do they download it? Place also includes the logistics of each of these things. If you’re product is sold in retail stores how did it get there? How many of them are there? How soon do you need to get more there? Everything that you need to consider about how to get your product to your customer, or to a place where your customer can find it is a part of Place.
Now remember, it’s not enough to choose a good Product, Price, Place and Promotion, because we have to know how to define “good”. Let’s use an example to illustrate.
So let’s say that your seven-year-old wants to set up a lemonade stand to make some extra money. What will she have to figure out? She’ll need to decide where to place her stand, how to make the lemonade, what she should charge for it and how to let people know what she’s doing. If she came up to you and asked you how to do all of this, you’d have to tell her that “it depends.”
Where she sets up her stand depends on who she wants to sell the lemonade to; grown-ups or kids – should the stand be in the park or at the end of her driveway? Same with the recipe – how much sugar should she add? More for kids than for grown-ups, probably. If she makes grown-up lemonade, she might be able to charge more for it because adults have more money to spend. On the other hand if she sets up her stand in the park, and sells sweet lemonade to kids, more of them will see it and she won’t have to tell people about it.
You have to know who your target market is before you make any of the 4P decisions, or you’ll be in the same mess as the seven-year-old – not knowing which course of action is best for any of the Ps. If the seven-year-old knew from the get go that she wanted to sell lemonade to other kids, she would have been able to decide right away that she should have a sweet lemonade (product) that she would sell in the park (place, promotion) for $0.10 a cup (price).
If she wanted to sell to grownups she would have her stand at the end of her driveway where lots of adults walked to and from work (place) the lemonade would be tart (product), her mom would probably tell some of her neighbors about it (promotion) and she could charge $0.25 a cup (price).
At the end of the day it comes down to figuring out your target market, and what works for them. Your offering will be perfect for some people, and those are the ones you need to reach.
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