Reading: Components of the Marketing Mix

Product

Purple hexagon with the following text in the center: Product: What solution does the customer want and need? Outside the hexagon, to the right, is a bulleted list of considerations: features, design, user experience, naming, branding, differentiation In the marketing mix, the term “product” means the solution that the customer wants and needs. In this context, we focus on the solution rather than only on the physical product. Examples of the product include:

The Tesla Model S, a premium electric car
A Stay at a Holiday Inn Express, a low-price national hotel chain
Doritos Nachos Cheese, a snack food
Simple, an online banking service

Each of these products has a unique set of features, design, name, and brand that are focused on a target customer. The characteristics of the products are different from competitors’ products.

Screenshot of simple.com website reads “All your finances, in your pocket or on the web, whenever you need it” and shows four different services Simple offers: the Simple Visa Card, ATM access, Powerful Reporting, and photo check deposits. The details for the Simple Visa Card read “It all starts here, and is connected to an FDIC insured account, for your security. Spending on your debit cards is quickly reflected in your account, and you’ll get push notifications, too.” The details for the ATM access reads “Over 55,000 surcharge-free ATMs – the most in the nation – with STARsf. Find the closest one with our iPhone and Android apps.” The details for Powerful Reporting read “There’s so much information in each transaction you make. Simple’s powerful organization tools automatically categorize, analyze, and personalize, your data so you can see your spending come to life.” The details for the photo check deposit read “Hate putting on pants? We got you. Deposit a check from your couch with Photo Check Deposit.”

Source: https://www.simple.com/banking

Promotion

Green hexagon with the following text in the center: Promotion: What is the dialogue between customer and company? Outside the hexagon, to the right, is a bulleted list of considerations: Message, method of delivering message, timing of delivery, communications by customers and influencers, competitor promotions. In the marketing mix, the term “promotion” refers to the communications that occur between the company and the customer. Promotion includes both the messages sent by the company and messages that customers send to the public about their experience. Examples of promotion include:

An advertisement in Cooking Light magazine
A customer’s review of the product on Tumblr
A newspaper article in the local paper quoting a company employee as an expert
A test message sent to a list of customers or prospects

Marketing professionals have an increasingly difficult job influencing promotions that cannot be controlled by the company. The company’s formal messages and advertising are only one part of promotions.

Marketers often run social media campaigns, rewarding customers who “Like” the company on Facebook.

Place

Turquoise hexagon with the following text: Place: how does the customer act or buy? Outside the hexagon, at the right, is a bulleted list of considerations: location of purchase, ease of transaction, access to distribution channels, sales force, competitor approaches

In the marketing mix, the term “place” refers to the distribution of the product. Where does the customer buy the product? “Place” might be a traditional brick-and-mortar store, or it could be online. Examples include:

Distribution through an online retailer such as Amazon.com
Use of a direct sales force that sells directly to buyers
Sales through the company’s Web site, such as the shoe purchases at Nike.com
Sales by a distributor or partner, such as the purchase of a Samsung phone from Best Buy or from a Verizon store

In today’s world, the concept of “place” in the marketing mix rarely refers to a specific physical address. It takes into account the broad range of distribution channels that make it easy for the target customer to buy.

Starbucks Online Ordering

How did a company like Starbucks that sells hot drinks from a storefront use mobile technology to improve distribution? Watch the video, below, to find out:

You can view the transcript for “Starbucks Launches Mobile Ordering So You Can Skip The Line” here (opens in new window).

Price

Orange hexagon with the following text in the middle: Price: what is the cost to the consumer? Outside the hexagon, at the right, is a bulleted list of considerations: value to buyer, price sensitivity, existing price points, discounts, competitor pricing

In the marketing mix, the term “price” refers to the cost to the customer. This requires the company to analyze the product’s value for the target customer. Examples of price include:

The price of a used college textbook in the campus bookstore
Promotional pricing such as Sonic Drive-In’s half-price cheeseburgers on Tuesdays
Discounts to trade customers, such as furniture discounts for interior designers

Marketing professionals must analyze what buyers are willing to pay, what competitors are charging, and what the price means to the target customer when calculating the product’s value. Determining price is almost always a complicated analysis that brings together many variables.

Sonic offers discounts on cheeseburgers on Tuesday, which is typically a low sales day of the week. Source: https://www.sonicdrivein.com

Module 2: Marketing Function