Marketing Mix

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What Is Marketing Mix?

A marketing mix refers to a selection of tools and strategies used by businesses to reach out to potential customers and boost sales. Its purpose is to help companies find a prudent combination of product, promotion, price, etc., so that they can gain an advantage over their competitors.

Marketing Mix Definition

The right marketing mix comprises a number of crucial strategies that enable business owners to target a particular market and create a brand image that engages potential buyers. It is crucial for an organizationā€™s short-and-long-term strategies concerning sales generation. There are various components of marketing mix, for example, place, promotion, process, product, price, people, etc.

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  • The marketing mix definition refers to various factors that companies can control to influence consumers to buy their products. It includes different focus areas as part of a comprehensive marketing plan.
  • It has seven elements; price, product, physical evidence, promotion, and place are a few of them.
  • This concept helps businesses avoid unnecessary expenses by utilizing their strengths and enables them to plan product offerings more efficiently.
  • It comes with certain disadvantages. For example, establishing an effective marketing mix strategy can be time-consuming. Moreover, businesses may need to spend substantial funds.

Marketing Mix Strategy Explained

The marketing mix definition refers to a set of controllable tools that helps businesses understand what elements they must combine to fulfill their marketing objectives. Its goal is to align a businessā€™s marketing activities with the target customersā€™ requirements. This term often refers to a classification that started as the four Ps ā€” price, product, promotion, and placement.

Organizations depend on this concept to identify their most viable offerings and core values. A prudent marketing mix must be goal-focused, adjusting every variable to achieve optimum sales. Focusing on the various tools of this mix enables organizations to be adaptable when responding to customersā€™ buying behavior.

The concept is also a crucial part of a businessā€™s brand identity, enabling companies differentiate themselves from their peers or reach out to new audiences.

7Ps of Marketing Mix

Let us look at the elements of 7Ps of marketing mix in detail.

  • Price: How a business determines pricing depends on various factors, for example, whether organization has special characteristics or a unique selling position that can attract customers, if any discount or promotion is available to consumers, etc. Once companies set the price, they must review it periodically to determine if it is suitable for the current market situation. A product or serviceā€™s pricing influences a businessā€™s sales and overall profitability.
  • Product: The product or service offered by a business has an intrinsic impact on customer outreach. Organizations sell products and services fulfill a certain requirement, targeting a certain kind of user. This element also addresses the productsā€™ manufacturing process and lifespan. All businesses must evaluate their products to determine whether they are comparable to their peersā€™ offerings, and if not, what steps they must take to improve the quality.
  • People: Any individual who comes in contact with customers, fall in this category. In other words, it includes operations personnel, business partners, or people whom customers can associate with company. These individuals are the face of a business. Hence, it is crucial for organizations to ensure that such individuals receive proper training, believe in the business goals, and understand the brand.
  • Process: Business process affects user experience. Hence, it is a critical element of this concept. It involves the order fulfilment procedure and who customers interact with during the sales process. The more seamless an organizationā€™s processes, the happier the customers.
  • Physical Evidence: This offers tangible cues of the quality of experience offered by an organization. Physical evidence can be specifically useful for customers if they have not purchased anything from a business before and want reassurance, or when they need to pay for any product before delivery. For example, in the case of restaurants, physical evidence could be menus, staff uniform, and online review.
  • Promotion: This element includes everything businesses use to tells their customers about their product, service, or brand.  In other words, it comprises advertising platforms, for example, social media, radio, TV, etc. It works closely with product placement to reach the target audience better.  Businesses must conduct in-depth market research to determine which tools and channels can generate the best customer response.
  • Place: The place where a business sells its products determines which marketing tools will be successful. Online sales require businesses to implement strategies different from the ones used for brick-and-mortar stores.

This element influences a companyā€™s overhead costs and distribution model, including the number of employees they must hire and the product or service delivery process. Determining whether the service or product must be tested out or seen in person is crucial to determine the place. Moreover, businesses must make a decision based on how much customer interaction they are willing to have.

Steps

Businesses can follow these steps to establish an effective marketing mix strategy:

  1. Establish goals and objectives
  2. Create a budget
  3. Determine the unique selling proposition (USP)
  4. Identify the target market
  5. Ask customers for advice
  6. Define the product in detail
  7. Select the distribution channels
  8. Establish a pricing strategy
  9. Select the promotional techniques
  10. Utilize inbound marketing

Examples

Let us look at a few marketing mix examples to understand the concept better.

Example #1

Dollar Tree prices everything in its stores at $1 or lower, thus leveraging price as a factor. Customers think that theyā€™ll save money by shopping at the stores.

Example #2

Another company one can look at to understand the marketing mix concept is Red Bull. Let us look at some of its elements:

  • Product: Besides the original drink, Red Bull offers a number of energy drinks with varying tastes, for example, Red Bull Total Zero and Red Bull Sugarfree.
  • Place: Red Bull is available in more than 170 countries worldwide. Thus, it is readily available like Coca-Cola. The company sells its products in the locations where people stay up late.
  • Price: Red Bull uses a premium pricing strategy owing to its high market share and product quality.

Importance

The following points highlight the importance of this concept.

  • It helps businesses understand their products or services can offer to the consumers.
  • Businesses can use the concept to manage and allocate a budget efficiently.
  • The marketing mix concept enables businesses get useful insights on future trends.
  • It helps organizations determine the return on investment and marketing effectiveness.
  • Businesses find it easier to plan product offerings if they use this concept.
  • It enables companies to utilize their strengths and steer clear of unnecessary expenses.

Disadvantages

The disadvantages are as follows:

  • It requires significant time and funds.
  • This concept lacks transparency and measurement standards. Businesses often find it challenging to get details regarding how to create marketing mix models or the measures utilized by them.
  • The concept does not specifically address certain crucial marketing activities, for example, packaging.

Marketing Mix vs Marketing Strategy

The following are some key differences between marketing mix and marketing strategy:

  • Marketing strategy refers to how a business plans on generating revenue and make its products and services competitive in the market. On the other hand, marketing mix comprises various elements like price, people, product, and place associated with leading the strategy.  
  • While a marketing strategy involves adopting a holistic approach to goal setting, businesses can customize marketing mix to formulate strategies based on marketplace conditions and individual products.

Frequently Asked Questions (FAQs)

1. When was the term marketing mix coined?

James Culliton coined the term in 1948. He described marketing managersā€™ role as ā€˜a mixer of ingredientsā€™ as they mix the different Ps of marketing, for example, price, product, and place together.

2. How does the marketing mix help a business?

It helps companies determine the right marketing strategy for their business. It is the first step before even establishing a marketing plan or business. This is because the marketing mix decisions also affect an organizationā€™s targeting, positioning, and segmentation decisions.  

3. How can marketing mix build competitive advantage?

Organizations adapt their marketing mix to try and convince customers that their offerings are better than their competitorsā€™ products and services. The primary objective of such adaptations is to gain a competitive advantage. Businesses can do this by selling a product or service that fills a gap in the market.

4. Which marketing mix is the most important?

Although product is the most important element of a marketing function, it requires other components (place, promotion, price, etc.) intertwined to succeed.