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Marketing is often over-complicated by people who do not understand it well. In many businesses, marketing is often an afterthought. For many, it just means aggressive, on-your-face promotions or huge discounting. This is wrong at so many levels that I can’t even begin to explain. So in this blog, I will go back to the basics of marketing and explain how one should approach it in any business. Let’s start.
A popular sales influencer, Cole Gordon, frames it well – any business is in the business of solving problems. But whose problems? Customers’. So any business should begin with identifying who are targeting. That’s where marketing also begins. We start by identifying the market we plan to serve.
A good way to define that is to create a persona of our target customer. Creating a persona would force us to research the target market and understand the customer better. This helps us understand their fears, pain points, irritants, needs, wants, and desires well. Any solution the business provides should solve one of these emotions in the target customer.
Marketing Mix fundamentals
At its core, Marketing is “Creating, delivering, and communicating customer value”.
This is a very important statement and should drive all our decisions in marketing. Let’s understand this a bit more. It means that marketing doesn’t begin when the product is ready. Marketing begins when we are thinking of the customer to serve, much before a product or a solution is created.
With this in mind, let’s now look at the different Ps of marketing.
Marketing begins when we are thinking of the customer to serve, much before a product or a solution is created.
At this point, you have a clear target audience in place and a problem to tackle for that audience. (Remember the problem has to fall in one of these buckets: fear, pain point, irritant, need, want or desire.) You are now ready to create a marketing strategy to approach the solution. (Note you haven’t even started creating the product yet. )
This is where you can use the Marketing mix i.e. Ps of marketing to create a robust marketing strategy.
Ps of marketing – The Marketing mix
The different Ps of marketing basically helps us plan and execute how to approach the target market. This is also called the Marketing Mix.
There are many different marketing mixes that people have created over last few decades. But the most fundamental one is called the 4Ps of marketing.
4Ps of marketing mix
The 4Ps of marketing is the most fundamental of all marketing mixes floating around these days. In my opinion, this is the only one you need. Everything else is just an extension of this and simply over-complicate things. Let’s understand the 4 Ps.
The 4 Ps stand for Product, Place, Price and Promotion. Think of this in terms of a Lemonade stand.
What product (or service or experience) will solve the problem for your target customer?
When you are thinking of the solution, remember to address at least one of the emotions in your customer i.e. fear, pain point, irritant, need, want or desire. How can your solution add immense value for your customers?
When you are thinking about the product, it has to add so much value to the customer that taking the solution should be a no-brainer.
This is the part where many startups struggle. Once you create the product that the market is looking for, we say that your business has achieved a Product-Market Fit (PMF).
In the example of a lemonade stand, you are identifying the exact type of lemonade that your audience desires in the scorching heat. For example, in your case, the product might be a sweet lemonade with a tinge of salt served in a small glass jar with ice, mint leaves, and a steel straw.
Once you achieve the PMF, your product becomes a no-brainer for your target segment.
Next P is Place. Where would you sell it to your target customer?
Will you sell it online or offline or both? Will you sell it via distributors or resellers? How will the logistics work? In essence, this aspect covers how the sales touchpoint would be. Some people split this into multiple Ps like Packaging, Partners and so on. You will see that is a 7Ps model or a 9 Ps model etc. In my view, that’s just over-complicating it.
Just think of everything you need to sell your product at a place. In our example, you may decide to keep the lemonade stand at the corner of a busy office street during lunch time and evenings.
Next is Price. How much should you sell the solution for?
There are some important things to keep in mind here. The price you decide should not only make you money, but it should also be a number where the customer feels the value he gets is MUCH MORE than the price he pays.
If one of the two conditions is not met, the business will not be sustainable. Hence, you must see what would be the alternative solutions available for the customer and how are they priced.
For example, in our lemonade scenario, say a bottle of cola costs $1 a pop. If you are selling lemonade at $3 a glass, you will not sell much. Customers will look at the alternative solution i.e. Cola in this case.
The last P is promotion. And this is the easiest. How do you communicate the value of your solution to the customer?
This is where most companies focus all their energies on. In fact, they often think this is all marketing is – promotions. I agree that a lot of effort in the later stages, is focussed on promotion. Because once you figure out the first 3Ps (Product, Place and Price) – it doesn’t change that often.
However, it is important to revisit the first 3Ps regularly to ensure the Product Market Fit is intact. The market is an ever-evolving environment. Customers’ needs can change. Newer alternatives come in. Competition could change the pricing. There are many variables beyond our control. Hence a regular revisit to the 3Ps will help ensure the promotions we do is effective.
For example, in the case of our lemonade stand, say winter comes, and it snows heavily in our area. In that case, our product must change. A hot chocolate would sell much better than an ice-cold lemonade. The pricing will also change since the raw materials and labor costs would have changed. The Place where you sell might be a warm tent instead of an open stall or you may choose to deliver hot chocolate to your customer’s desk.
The point is, if you do not revisit the 4Ps often, you might keep promoting an iced lemonade in winter and blame your “marketing” for not doing a good job. You may also wrongly conclude that more money is needed to get more customers.
Here are some good links to learn about other marketing mixes, in case you are interested:
There is more… like 12Ps and 20Ps etc. But I am not even going to link them. Not worth reading.
You can read my blog on Marketing Strategy v/s tactics to understand where the marketing mix fits in overall strategy and planning.
Hope this helps.
About the Author:
Shyam is an independent marketing consultant who helps companies get more customers organically. He focuses on organic marketing techniques to build a solid lead pipeline for his customers in the long term. Get in touch with Shyam here.