What is Marketing Mix?
Marketing mix is a set of controllable, tactical tools, product, price, place and promotion that the firm blends to produce the response it wants in the target market. The marketing mix consists of everything the firm can do to influence the demand for its product.
Table of Content
- 1 What is Marketing Mix?
- 2 Marketing Mix Definition
- 3 Features of Marketing Mix
- 4 4Ps of Marketing Mix
- 5 Pepsi Marketing Mix (4Ps) Strategy
- 6 Importance of Marketing Mix
- 7 Factors Affecting Marketing Mix
- 8 Marketing Mix Infographic
- 9 Marketing Management Topics
Marketing Mix Definition
The marketing mix is the set of marketing tools the firm uses to pursue its marketing objectives in the target marketPhilip Kotler
Marketing mix is a pack of four sets of variables namely product variables, price variables, promotion variables and place variables.Cravens et. al
Marketing mix is the term used to describe the combination of four inputs which constitute the core of a company’s marketing system—the product, the promotional activities and the distribution systemStanton
The marketing mix refers to the apportionment of efforts, the combination, the designing, the integration of the elements of marketing into a program or mix which on the basis of an appraisal of the market force, will achieve the market objectives of an enterprise in a given timeProf. Neil H. Bordon
Features of Marketing Mix
- Root of Marketing Process
- Reviewed Constantly in Order to Meet the Changing Requirements
- Changes in External Environment
- Changes taking place within the firm too necessitate changes in marketing mix
Root of Marketing Process
Marketing mix involves many crucial decisions relating to each element of the mix. The impact of the mix would be the best when proper weightage is assigned to each element and they are integrated so that the combined effect leads to the best results.
Reviewed Constantly in Order to Meet the Changing Requirements
The marketing manager is required to constantly review the mix and conditions of the market, and make necessary changes in the marketing mix according to changes in the conditions and complexion of the market.
Changes in External Environment
Changes keep on taking place in the external environment. For many industries, customer is the most fluctuating variable of environment. Customers’ tastes and preferences a period of time. The marketing manager has to carry out market analysis constantly to make necessary changes in the marketing mix.
Changes taking place within the firm too necessitate changes in marketing mix
Changes within the firm may take place due to technological changes, or changes in the product line, or changes in the size and scale of operation. Such changes call for correspondent changes in the marketing mix.
4Ps of Marketing Mix
The 4Ps of marketing mix consist of product, price, place and promotion, which together can be mixed to get the right approach for your business. Approach it like a recipe for business success.
Product can be defined as the goods and services that an organisation offers for sale. Products can be tangible or intangible. Intangible products such as ideas, service and experience, cannot be touched and felt before purchase.
They can only be experienced after purchase. On the other hand, tangible products such as shoes, lipstick and bottles, can be seen, felt and touched, stocked and consumed in many uses. People purchase products to satisfy their needs. They make the payment for the benefit which they get from the product.
Therefore, in simple language, you can say that a product is a bundle of utilities or benefits and for enjoying that benefit customer make payment charged by the marketer. For example, when you purchase lipstick, you pay for beauty or good look it is going to give after applying or when you take bus, you pay for travelling. Hence, you pay for the benefits.
Price is the amount of money consumer will pay for the products or service.
Many factors like the demand of a product, cost incurred, customer’s ability to pay, prices charged by competitors, government policy etc. have to be kept in mind while setting the price of a product in a target market. In fact, pricing is most important decision which can affects the demand and profitability of the firms.
Below are the 8 pricing strategies that a marketer can follow while fixing the price.
- Cost-plus – Adds a standard percentage of profits to the future costs to manufacture the product. Evaluation of the fixed and variable costs is an important part of this pricing method.
- Value basis – Price is based on the buyer’s perception of value (rather than its cost). Here, the buyer’s perception depends on all aspects of the product, including the price of factors such as the quality of the image and prestige.
- Competition – Based on other companies competing products prices. Here, the organization prices compare the prices of their competitors and thus can directly monitor their competitors and price response to changes occurring in the market.
- Input Size – When entering a market is established a joint product price. Then, most companies have to cut down or too not to increase prices in order to keep control of the market.
- Discount – which is based on advertising, helps reduce prices and thus can attract new customers and expand the market share.
- Loss Leader – Sales takes place at a price lower than the cost of production in order to attract customers to the store to buy other products.
- Psychological – which has an impact on consumer behaviour, such as a price that looks better: 6.99 $ per pound instead of $ 7.00 per pound.
Goods are produced for the consumer. Goods must be available to the customer at a place where they can conveniently make a purchase. It is also referred to the distribution channels used to get your product to your customers.
Businesses that produce a product have two options to sell: selling directly to consumers or selling to a vendor.
The marketer must decide if supplying directly is appropriate for your product, whether it be sales through retails, door to door, e-commerce, on-site or some other method.
An advantage is meeting customers face to face and can make market change according to the consumer. It is a good place when the supply of the product is limited.
Reseller Sales (Intermediary)
Selling through an intermediary such as a wholesaler or retailer who will resell your product. It provides you with a wider distribution than selling direct while decreasing the pressure of managing your own distribution system. Also reduce the storage space necessary for inventory.
No matter whether you sell your product direct or through a reseller, you must decide what your coverage will be in distributing your product.
- Intensive distribution is the placement of a product in as many places or widespread, often at low prices.
- Selective distribution narrows distribution to a few businesses and usually upscale products are sold through retailers that only sell high-quality products.
- Exclusive distribution restricts distribution to a single reseller.
Promotion is an activity that communicates about the product or service and its merits to target consumers and persuades them to buy.
It helps to increase consumer awareness, leads to higher sales and helps to build brand loyalty. Promotion is done through a different mean of advertising, publicity, personal selling and sales promotion.
Advertising is a key channel to promote your product or service include the following:
- Radio advertisements are a good way to inform local customers about the business which is inexpensive.
- Television which is quite expensive but reaches to a more wider regional audience.
- Printed materials and Mails which includes newspapers, magazines, flyers allow the company to explain what, when, where, and why people should buy from you.
- Word of Mouth depends on satisfied customers (or dissatisfied customers) telling their friends, relatives about the value that the product provides.
- Generic: When no specific product is promoted, but rather a whole industry is advertised. Some of the common examples of these industries are milk, beef, and pork etc.
Read: Market Segmentation | Definition, Types, Bases, Examples
Pepsi Marketing Mix (4Ps) Strategy
Marketing Mix of Pepsi analyses the company which covers 4Ps (Product, Price, Place, Promotion) and explain the marketing mix of Pepsi. Marketing mix example is explained through Pepsi Marketing Mix.
Carbonated soft drink is the main product of the Pepsi Co. Carbonated beverages along with fruit juice, snacks etc. are the products in the marketing mix. Company has also ventured into products like Lipton tea and Tropicana juices.
Below is the current product lines of PepsiCo:
- Soft drinks
- Energy drinks
- Rice snacks
- Side dishes
- Breakfast bars
- Sports nutrition
- Bottled water
- Other merchandise
PepsiCo has a wide product mix which means they offer a larger number of the product line and brands. Due to competition with Cola, price is always competitive. They also offer various size rates. Pepsi is also known for the promotion discount and bulk buying discount.
PepsiCo’s main strategy are:
- Market-oriented pricing strategy
- Hybrid Everyday Value pricing strategy
PepsiCo has a global presence in more than 200 countries with a variety of products. The PepsiCo mainly focuses on the relationship with the distributors. Mostly PepsiCo places its distributing products at non-online retailers.
PepsiCo’s places for distribution are given below:
- Online merchandisers
Most of the products are available at retailers such as grocery store, convenience stores and supermarket.
PepsiCo majorly targeted its cold drinks and food products to the youth and family. They sign with celebrity personality and create a brand image. Advertisement is the primary tactic for marketing communications.
PepsiCo’s promotional mix, arranged according to significance:
- Sales promotion
- Direct marketing
- Public relations
Importance of Marketing Mix
An organisation must handle the marketing mix carefully because it helps in making a good business plan for the organisation. But if an organisation is unable to rightly blend the 4Ps of the marketing mix then the business could get negatively affected and may take years to recover. Therefore, the marketing mix requires an organisation to conduct a lot of market research and consultation with several people.
Let us now understand the importance of marketing mix:
- It helps in understanding the utility of the products or services offered by the organisation to the customers.
- It facilitates planning a successful product offering.
- It helps to plan, develop and execute marketing strategies effectively.
- It enables the business to optimally utilise its strengths and eliminate unnecessary costs.
- It helps in facing the market risk proactively.
- It enables the organisation to find out whether it’s products or services are suitable for the customers or not.
- It helps in recognising and understanding customer’s requirements.
- It enables the organisation to learn when and how to promote its products or services.
- It facilitates the organisation to make the product or service available to the customers at the right time, at the right place and at reasonable price.
Factors Affecting Marketing Mix
There are markets and product-related factors that impact marketing mix of the organisation. These market-related factors include the behaviour of the customer, distribution system, legal policies and the nature of competition. Product-related factors include product planning, market research, promotion method and branding.
According to the controllability and non-controllability of factors, there are two types of factors that influence the marketing mix.
Internal factors can be controlled by the organisation whereas external factors cannot be controlled by the organisation. Let us understand these factors in detail:
These factors are controlled by the marketing management team that is why these factors are also called controllable factors. Some of the internal factors are discussed below:
It is the process of deciding in advance about all aspects of the product from production to distribution. The product planning includes introduction of new products and modification of existing products, identification of market requirement and elimination of unprofitable lines. For example, Hershey’s introduced Kissables in 2005 which were discontinued in 2009.
It is the amount given by the customer for buying the product. The organisations need to fix the price of the product in such a way that it suits to the market, and also provide reasonable profit to the business. Price of an organisation’s products is affected by the prices of the substitute and complementary products. For example, When Netflix entered India, it offered subscriptions at lower rates. however, when it captured a decent market share, it slowly increased its subscription prices.
It is using the organisation’s or the product’s name, symbol and design to create a particular image in the customer’s mind. An organisation has to decide about its name, symbol, and trademark while developing the products. For example, Purplle, which is a beauty and cosmetic products e-commerce company has roped in Sara Ali Khan as its brand ambassador.
It is face-to-face selling of the product. In this selling an organisation ask the salesman to meet the customer or client and convince them to buy the product. Personal selling can increase the product’s sale and help the organisation to understand the needs and desires of the people.
Physical distribution: It is the movement of the products from production place to consumption place. The physical distribution includes the channels of distribution, means of transportation, warehousing, inventory management etc.
It is a system of collecting information related to the target market and analysing the consumer and market conditions. Market research helps in making product-related decisions.
For example, most companies conduct market research to decide which products are liked/disliked by the consumers, what new products or variants are demanded by them, etc. In many cases, the companies usually engage in market research to scout for hidden opportunities.
These are the uncontrollable factors which are beyond the control of the marketing management.
Consumer’s buying behaviour
It is the buying behavior or habits of the consumer. Ultimate consumer’s buying habits, buying power, living standard, etc., affects marketing mix. For instance, the companies offer gourmet products to customers living in posh localities.
Similarly, high-end restaurants and speciality restaurants such as Japanese or Thai restaurants are usually located in premium areas.
It refers to the behaviour of intermediaries such as agents, retailers, wholesalers and their motivations, practices, attitudes, etc., the behaviour of the traders influence the product’s marketing and its volume.
Competitors are the organisations’ business rivals. There are many firms in an industry that compete with each other by offering similar or near-similar products. For example, if competitors decrease prices, other market participants also decrease prices to maintain their market share.
It refers to the policies, laws and legislations of the government towards the products, fair trade pricing, competitive practices, advertising regulations etc. The governments in respective markets set the rules and regulations in different markets and organisations have no control over them.
Marketing Mix Infographic
Go On, Share & Tell Us What You Think!
Did we miss something in Marketing Management Tutorial or You want something More? Come on! Tell us what you think about our post on Marketing Mix 4ps | in the comments section and Share this post with your friends.