7P’s in the Marketing Mix

1. PRODUCT - Product refers to any goods or services that is produced to meet the consumers’ wants, tastes
and preferences.

GOODS
A. CONSUMER GOODS
B.BUSINESS GOODS

PRODUCT

SERVICES
• A. CONSUMER SERVICES
• LAWN CARE
• HAIR STYLING
• B. PROFESSIONAL
SERVICES
• ENGINEERING
• ACCOUNTING
• CONSULTANCY

The two (2) types of products

2. PLACE
Place is the second P in the Marketing Mix. Place represents the location where the buyer and seller exchange
goods or services. It is also called as the distribution channel. It can include any physical store as well as virtual
stores or online shops on the Internet.

The main function of a distribution channel is to provide a link between production and consumption.

STAGES OF DISTRIBUTION CHANNEL

Channel 1 contains two stages between producer and consumer - a wholesaler and a retailer. A wholesaler typically
buys and stores large quantities of several producers' goods and then breaks into bulk deliveries to supply retailers
with smaller quantities. For small retailers with limited order quantities, the use of wholesalers makes economic
sense.
Channel 2 contains one intermediary. In consumer markets, this is typically a retailer. A retailer is a company that
buys products from a manufacturer or wholesaler and sells them to end users or customers. In a sense, a retailer is
an intermediary or middleman that customers use to get products from the manufacturers.
Channel 3 is called a "direct-marketing" channel, since it has no intermediary levels.
In this case the manufacturer sells directly to customers.

3. PRICE
price is the value of money in exchange for a product or service.
The Different Pricing Strategies and Its Definition
Pricing Definition
Strategies

Penetration The price charged for products and services is set artificially low in order to gain
Pricing market share. Once this is achieved, the price is increased.
Skimming A company charges a higher price then slowly lowers the price to make the
Pricing product available to a wider market because it has a considerable competitive
advantage. However, the advantage tends not to be sustainable. The high price
attracts new competitors into the market, and the price inevitably falls due to
increased supply.
Competition A pricing method in which a seller uses prices of competing products as a
Pricing benchmark instead of considering own costs or the customer demand. In reality
a firm has three options and these are to price lower, price the same or price
higher than competitors
Product Line The practice of reviewing and setting prices for multiple products that a
Pricing company offers in coordination with one another. Rather than looking at each
product separately and setting its price, product-line pricing strategies aim to
maximize the sales of different products by creating more complementary,
rather than competitive, products. If you offer more than one product or
service, consider the impact that one product's or service's price will have on
the others.
Bundle Pricing The act of placing several products or services together in a single package and
selling for a lower price than would be charged if the items were sold
separately.
Premium Setting the price of a product higher than similar products. The goal is to create
Pricing the perception that the products must have a higher value than competing
products because the prices are higher.
Psychological Psychological pricing is the practice of setting prices slightly lower than rounded
Pricing numbers, in the belief that customers do not round up these prices, and so will
treat them as lower prices than they really are. This practice is based on the
belief that customers tend to process a price from the left-most digit to the
right, and so will tend to ignore the last few digits of a price.
Optional Pricing The company earns more through cross-selling products along with a basic core
product. The main product does not have many features (and is priced low)
 which can be enhanced through optional or accessory products which are sold
at premium by the same company.
Cost Plus Cost plus pricing involves adding a markup to the cost of goods and services to
Pricing arrive at a selling price. Under this approach, you add together the direct
material cost, direct labor cost, and overhead costs for a product, and add to it
a markup percentage in order to derive the price of the product.
Cost Based A pricing method in which a fixed sum or a percentage of the total cost is added
Pricing (as income or profit) to the cost of the product to arrive at its selling price.

Value Based A price-setting strategy where prices are set primarily on consumers' perceived
Pricing value of the product or service.

4. PROMOTION
. Promotion refers to the complete set of activities, which communicate the product, brand or service to the
user. The idea is to create an awareness, attract and induce the consumers to buy the product, in preference
over others.
PROMOTIONAL MIX
1. ADVERTISING
• Radio
Advertising by means of radio gives the advantage of selecting the territory and audience to which the message is to
be directed. It is also cheaper than TV advertising.

• Television
This is the latest and the fast-developing medium of advertising and is getting increased popularity these days. It is
more effective as compared to radio as it has the advantages of sound and sight. On account of pictorial
presentation, it is more effective and impressive and leaves a lasting impression on the mind of the viewer.

• Print
The print media carry their messages entirely through the visual mode. These media consist of newspapers,
magazines and direct mail.

• Electronic
You can also advertise electronically through your company website and provide important and pertinent
information to clients and customers. You can protect some parts of your website through passwords and give
access to member customers. You can also send advertisements via direct e-mail as part of your promotional
strategy.

• Word of Mouth
Word-of-mouth advertising is important for every business, as each happy customer can steer dozens of new ones
your way. And it's one of the most credible forms of advertising because a person puts their reputation on the line
every time they make a recommendation and that person has nothing to gain but the appreciation of those who
are listening.

• Generic
The promotion of a particular commodity is without reference to a specific producer, brand name or manufacturer.
Producers join together to expand total demand for the commodity, thereby helping their own sales. These activities
are often self-funded through assessments on marketing called check-off programs.

2. PUBLIC RELATIONS OR PR
 In public relations, the article that features your company is not paid for. The reporter, whether broadcast or
print, writes about or films your company as a result of information he or she received and researched.
3. PERSONAL SELLING
Personal selling occurs when an individual salesperson sells a product, service or solution to a client
The five stages are:
• Prospecting
• Making first contact
• The sales call
• Objection handling
• Closing the sale
4. SALES PROMOTIONS
Sales promotion is any initiative undertaken by an organization to promote an increase in sales, usage or trial of a
product or service.
Sales Promotion Technique
• Free Gifts
• Free Samples
• Free Trial
• Customer Contests
• Special Pricing
5. DIRECT MARKETING
Direct marketing is a promotional method that involves presenting information about your company,
product, or service to your target customer without the use of an advertising middleman.

Forms of Direct Marketing

Brochure Catalogs Fliers Newsletters Post cards
Coupons Email Phone calls Text messages

5. PEOPLE
Your team, the staff that makes it happen for you, your audience, and your advertisers are the people in
marketing.
6. PACKAGING
Packaging is a silent hero in the marketing world. Packaging refers to the outside appearance of a product and how it
is presented to the customers.
Five Basic Functions of Packaging
A. Natural deterioration:
It is caused by the interaction of products with water, gases and fumes, microbiologic organisms like bacteria,
yeasts and molds, heat, cold, dryness, contaminants and insects and rodents.

B. Physical protection:
The packaging is also used for physical protection, which include improving shock protection, internal product
protection and reducing shock damage caused from vibration, snagging, friction and impact.

C. Safety:
A special kind of protective packaging is required for products that are deemed harmful to those who transport
them or use them. These products include extremely inflammable gas and liquid, radioactive elements, toxic
materials etc. The packaging should also be done so that children could not easily use or dispose them.

D. Waste reduction:
Packaging also serves to reduce the amount of waste especially in case of food distribution.
2) Containment:
This involves merging of unit loads for shipping. It starts with spots of adhesives on the individual shippers that stick
them together, straps of steel and plastic, entire coverings of shrinkable or stretchable plastic films and paper or
corrugated wraps that surround an entire pallet of product.

There are some special bulk boxes or pallet bins made from unusually strong corrugated board or fabricated form
plastics or metal, the method of which depends on the type and weight of product and its protective needs. The
cargo containers made of aluminum used to hold many pallet loads of goods can be transferred to or from ships,
trains and flatbed trucks by giant cranes.

3) Information:
The packaging conveys necessary information to the consumers. The common information that packaging provides
include general features of the product, ingredients, net weight of the contents, name and address of the
manufacturers, maximum retail price (MRP).

Packaging of medicine and some food products is required to provide information on methods of preparations,
recipes and serving ideas, nutritional benefits, and date of manufacturing, date of expiry, warning messages and
cautionary information. Sometimes, the color of the packaging itself provides some information.

4) Utility of use:
The convenience packaging has been devised for foods, household chemicals, drugs, adhesives, paints, cosmetics,
paper goods and a host of other products. This type of packaging includes dispensing devices, prepackaged hot
metals, and disposable medical packaging.

5) Promotion:
Companies use attractive colors, logos, symbols and captions to promote the product that can influence customer
purchase decision.

Packaging Decisions:

i. Packaging concept:
This defines what the package should be or do for the particular product in terms of size, shape, materials, color, text,
and brand mark and tamperproof ability

ii. Engineering tests:

This will ensure that the package stands up under normal conditions

iii. Visual tests:

This is to ensure that the script is legible and colors are harmonious

iv. Dealer tests:

This is to ensure that the dealers find the packages attractive and easy to handle

v. Consumer tests:
This is to ensure favorable consumer response
7. POSITIONING
Positioning refers to a process used by marketers to create an image in the minds of a target market.

THREE BASIC CONCEPTS FOR POSITIONING

1. Functional Positions- deal with solving a problem, providing benefits and getting a favorable perception from
investors, stockholders and consumers.
2. Symbolic Positions- deal with self-image enhancement, ego identification, belongingness, social meaningfulness
and affective fulfilment.
3. Experiential Positions- deal with providing sensory or cognitive stimulation.

Steps of the Positioning Process

1. Confirm your understanding of market dynamics
At the start of the positioning process, you need a firm understanding of your target market.
2. identify your competitive advantages
A competitive advantage is some trait, quality, or capability that allows you to outperform the competition.
It gives your product, service, or brand an advantage over others in purchasing decisions.
3. Choose competitive advantages that define your market Niche
Your list of competitive advantages represents a set of possible positioning strategies you could
pursue for your product, service, or brand. The next step is to examine how these factors fit into customer
perceptions of your broader competitive set. Your goal is to pick a positioning approach that gives you a unique and
valued position in the market that competitors are not addressing.

4. Define your positioning strategy.

How to Create an Effective Market Positioning Strategy?

Create a positioning statement that will serve to identify your business and how you want the brand to be perceived
by consumers.

1. Determine company uniqueness by comparing to competitors

Compare and contrast differences between your company and competitors to identify opportunities. Focus
on your strengths and how it can exploit these opportunities.

2. Identify current market position

Identify your existing market position and how the new positioning will be beneficial in setting you apart from
competitors.

3. Competitor positioning analysis

Identify the conditions of the marketplace and the amount of influence each competitor can place on each
other.

4. Develop a positioning strategy

Through the preceding steps, you should achieve an understanding of what your company is, how your
company is different from competitors, the conditions of the marketplace, opportunities in the marketplace, and
how your company can position itself.

5. Communicate and deliver on the positioning strategy.

Brand Name is a name, symbol, or other feature that distinguishes a seller's goods or services in the marketplace.
 *Your brand is one of your greatest assets because your brand is your customers' over-all experience of
your business. Brand strategy is a long-term design for the development of a popular brand in order to
achieve the goals and objectives.
Branding is a powerful and sustainable high-level marketing strategy used to create or influence a brand.
Commonly Used Branding Strategies
1) Purpose
2) Consistency
3) Flexibility
4) Employee Involvement
5) Loyalty
6) Competitive Awareness