Marketing mix

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The marketing mix is generally accepted as the use and specification of the 4 P's describing the strategic position of a product in the marketplace (as originally defined and popularized by Philip Kotler in his Marketing Management book (see references below)).

1 Definition
2 Criticisms
3 See Also
4 References
5 External links

[edit] Definition

Although some marketers have added other P's, such as personnel, typically the 4 P's, or marketing mix refer to:

Product - Although this typically refers to a physical product, it has been expanded to include services offered by a service organization. The specification of the product is one of the variables that a marketer has at his/her control. For example, the product can include certain colors (or not), certain scents (or not), certain features (or not). Lastly, in the broadest sense when a consumer purchases a product it also includes the post-sales relationship with the company. The post-sales relationship can include customer service and any warranty.
Price – The price is the amount paid for a product. In some cases, especially in business-to-business marketing this can also include the total cost of ownership (TCO). Total cost of ownership may include costs such as installation and other products required to deliver a complete functional solution.
Place – Place represents the location where a product can be purchased. It is often referred to as the distribution channel. It can include any physical store as well as virtual stores on the Internet.
Promotion – Promotion represents all of the communications that a marketer may insert into the marketplace. This can include TV, radio, and print advertising, as well as coupons, direct mail, billboards, and online advertising. One of the less well-defined areas in promotion is the role of a human sales force. Are the messages the sales person provides to a consumer a component of the promotional mix, or is it part of the product? On the other hand, consumers may rather purchase the product only when sold through the support of a known salesperson. In this case, the service, perceived or real can be defined as a feature of the product (see Product above).

Broadly defined, optimizing the marketing mix is the primary responsibility of marketing. By offering the product with the right combination of the 4P’s marketers can improve their results and marketing effectiveness. Making small changes in the marketing mix is typically considered to be a tactical change. Making large changes in any of the 4P’s can be considered strategic. For example, a large change in the price, say from $129.00 to $39.00 would be considered a strategic change in the position of the product. However a change of $129.00 to $131.00 would be considered a tactical change, potentially related to a promotional offer.

[edit] Criticisms

Peter Doyle (Doyle, P. 2000) claims that the marketing mix approach leads to unprofitable decisions because it is not grounded in financial objectives such as increasing shareholder value. According to Doyle it has never been clear what criteria to use in determining an optimum marketing mix. Objectives such as providing solutions for customers at low cost have not generated adequate profit margins. Doyle claims that developing marketing based objectives while ignoring profitability has resulted in the dot-com crash and the Japanese economic collapse. He also claims that pursuing a ROI approach while ignoring marketing objectives is just as problematic. He argues that a net present value approach maximizing shareholder value provides a "rational framework" for managing the marketing mix.

Against Kotler's four P's, some claim that they are too strongly oriented towards consumer markets and do not offer an appropriate model for industrial product marketing. Others claim it has too strong of a product market perspective and is not appropriate for the marketing of services.

[edit] See Also

[edit] References

Kotler, Philip, Keller, Lane (2005) "Marketing Management", Prentice Hall, ISBN 0131457578.
Barlon, K. (2006) "The concept of the marketing mix" Presentation on marketing management, vol 1, September, 2006, pp 2-7-Oulu university -Finland - The same article can also be found in: Schwartz, G. (ed), Science in Marketing, John Wiley, New York, 1965, pp 386-397 - and also in: Enis, B. and Cox, K. (1991) Marketing Classics, A selection of influential articles, Allyn and Brown, Boston, 1991, pp 361-369.
Bitner, J. and Booms, B. (1981) Marketing strategies and organizational structures for service firms, in Donnelly, J. and George, W. Marketing, American Marketing Association, Chicago, 1981.
Culliton, J. (1948) The management of marketing costs, Graduate School of Business Administration, Research Division, Harvard University, Boston, 1948.
Doyle, P. (2000) Value based marketing, Wiley, Chichester, 2000.
Frey, A. (1961) Advertising, 3rd ed., Ronald Press, New York, 1961.
Hammer, M. and Champy, J. (1993) Reengineering the Corporation: A Manifesto for Business Revolution, Harper Business Books, New York, 1993, ISBN 0-06-662112-7
Hughes, M. (2005) "Buzzmarketing: Get People To Talk About Your Stuff", Penguin/Portfolio, New York, 2005 Website
Lauterborn, R (1990) "New Marketing Litany: 4 Ps Passe; C words take over", Advertising Age, October 1, 1990, pg 26.
McCarthy, J. (1960 1st ed.), Basic Marketing: A managerial approach, 13th ed., Irwin, Homewood Il, 2001.