Marketing requires several activities to be done. To begin with, a company may choose to enter one or more segments of a market- since it may not be possible to cover the entire market. The manufacturer of a bathing soap, for example, may aim at the working class in the middle or lower income groups as his target consumers. Once the largest market is decided, the product is positioned in that market by providing the appropriate product qualities, price, distribution and advertising efforts. These and other relevant marketing functions are to be combined or mixed in an effective proportion so as to achieve the marketing goal. To appreciate this process, it is easier to divide the marketing activities into four basic elements which are together referred to as the marketing mix.
These four basic elements of marketing mix (4 P’s of Marketing) are:
- Promotion, and
- Physical distribution.
As all these four starts with the alphabet ‘P’, they are referred to as the four ‘P’s of the marketing mix. Thus, marketing mix may be defined as the set of controllable marketing variables/activities till the firm blends to produce the response it wants in the target markets.
Look at the figure, It summarizes all the components of the marketing mix.
Let us study the four Ps of marketing mix components in detail.
The word ‘Product‘ stands for the goods or services offered by the organization. Once the needs are known, it is necessary to plan the product and after That keep on analyzing whether the product still satisfies the needs which were originally designed for and if not, to determine the necessary changes. How they have to be modified in market trend to continue to be successful in sales generation and why marginal or non-profitable products should be removed unless they are contributing some value to the overall benefit of the organization.
Price is the money that the consumer has to pay. Price must be considered as worthy the value of the product to become an effective marketing tool. The product has to be appropriately priced. The manufacturer has to Lake into account cost factors, profit margin, the possibility of sales at different price levels and the concept of the right price.
Promotion is the aspect of selling and advertising or communicating the benefits of the product or service to the target customers in order to persuade them to purchase such products or services. Promotion includes selling through advertising as well as the sales force. Besides, a certain amount of promotion is also done through special seasonal discounts, competitions, special price reductions, etc.
Place (Distribution) refers to the aspect of the channels of distribution through which the product has to move before it reaches the consumer. It also includes the logistic aspects of distribution such as warehousing, transportation, etc., needed for geographical allocation of products. It is also concerned with tlle selection of distribution channels. The organization must decide whether it should sell through wholesalers and then to retailers, or whether directly to the consumers. There are many ways to which a product can be sent from the producer to the consumer. The optimum method has to be determined regarding both consumer satisfaction and profitability to the organization, or optimum use of the organization’s resources.
The manufacturer must design the most effective combination of these four basic factors as well the expenditure he would like lo incur on them. The variables that are relevant in the marketing mix vary from company to company. These variables are not independent in their effect on the marketing effort. One variable may influence the other. Apart from the expenditure involved, these decisions are influenced by the company’s market positioning decision.