Nearly every business on the planet sets out with the primary objective of making money. This is generally done by producing some form of product, or offering a service, and then charging people money for it. This fundamental theory is fairly straight-forward, though it contains many intricate details.

Firstly, it is a very rare case that a company can offer a product or service that is genuinely unique and cannot be supplied by anyone else. This means that your business will be competing with other businesses that sell a similar item and you will both be trying to earn money from the same customers, who only want to spend their money once.

Marketing is the main tool used by modern organisations to draw prospective customers to do business with them and not with their competitors. It is a very extensive topic that is influenced by a great deal of internal and external factors, but when done well it can be the one business practise that could make or break a company. Any time spent on marketing will reap rewards, although spending this time correctly can yield incredible results.

So where should you start when creating a marketing strategy for your own business? Well, each situation is different, and every industry will have its own set of advantages and weak points that must be taken into consideration, but there is a marketing principle that can be applied to almost any company to be used as a marketing platform.

The Marketing Mix

The marketing mix was a phrase that was first coined during the 1950′s and is a phrase that is used to express the fundamental building blocks of any marketing system. It demonstrates the fact that marketing is not a simple, blunt-edged business technique, but rather a subtle balance of different elements of business operations. It got its name because it is similar to the ingredients list for a recipe.

The term was later built upon to include the concept of “four P’s” that described the critical elements of the marketing mix. The formalisation of these P’s made it very clear for company managers and marketers to swiftly relate the elements of marketing to the strengths of their own organisations, and by doing so could very rapidly form a customised and efficient marketing plan.

The “product” element of the four P’s could refer to any product, such as chiropractic Ruddington, or any intangible service being offered for sale by a company.

Product

Whilst every aspect of the marketing mix is a necessity, the “product” element mentioned as one of the four P’s is perhaps the most critical of all. It describes the physical product or intangible service that your company will be offering, and at the end of the day it is the reason that customers are going to spend money with you. If this part is not adequately managed then your organisation will find it hard to make it through.

Several people do not think that marketing has any place to play when it comes to the physical product that your business is selling. In fact, the common train of thought very often bears the precise opposite sentiment. Surely it should be the opposite way around – your production department creates an item for sale and then it is the task of the marketing department to find ways to sell it, right? This is not always the case.

Take the computer software market as an example. There are many well-known brands of both operating system and software application products on the marketplace already, and since the market is fairly well saturated it would be very tough (and expensive) to “take on the big boys”.

Rather than creating an operating system and then trying to craft a marketing strategy to rival the likes of Microsoft or Apple, it would be far more effective to look at what sorts of product are desired in the current marketplace, and how viable it would be to manufacture and sell them. By being mindful of the marketing mix early on in your product development period you can avoid business dead-ends at a later time.

Once your goods have been designed and created it is still a vital skill to be able to objectively evaluate your own products to identify the reasons that a customer would buy your product rather than a competitors’.

A different form of this part of the marketing mix is known as product variation and is typically used to either prolong the lifecycle of a product currently in the market, or to make your new product attractive to as many customers as possible.

The car industry uses this approach very effectively by offering different engines, trim packages and interior options with the cars that they offer. They use the marketing mix to good effect to sell their own products in an incredibly competitive marketplace.

“Product is paramount” is one of the mottos applied in our sunny plants firm which aims to remind all employees that we expect high quality production.

Price

Another key factor in the marketing mix concerns the price of your products or services. This is not a simple case of performing market research to determine the highest price that your customers would spend (although that can be a useful tool to use), but rather making use of the price of your products as a strategic tool designed to achieve any particular targets your company has.

Although it may seem obvious, it’s still worth pointing out that price has always been, and probably always will be, one of the crucial factors that customers take into account when they are making a purchase. It is also worth noting that customers do not constantly consider the cheapest price to be the best value. In fact a price that is too low can sometimes turn customers away.

There are many questions that you need to ask yourself while devising a good pricing plan, key amongst which are the price sensitivity of your clients, what your rivals are doing and how can pricing maximise your own profits. From a strategy point of view however, pricing can be covered by two main principals; price skimming and penetration pricing. These are outlined below.

Price skimming

The main idea behind price skimming is to make as much money as possible from the segment of the market which is price-insensitive and will be prepared to spend a premium amount of money to receive a product or service early on.

This pricing technique is frequently used in the consumer electronics industry where customers will often eagerly await the launch of a new mobile phone or computer games console. Manufacturers could set almost any price they wanted to and there would still be a loyal base of customers that would pay it. By making use of this method as part of a pre-ordering strategy, a company can help to smooth its own cash flow.

Penetration pricing

Penetration pricing is at the opposite end of the pricing spectrum, and is tailored towards gaining a large market share at a short-term cost so that financial rewards can be made long into the future. It can be a high risk strategy, but when employed correctly it can setup revenue streams for many years to come.

Yet another thing to keep in mind is that “price” is the only part of the marketing mix that will generate revenue for a business. The other members of the four P’s will all cost money to produce or carry out. So it is even more vital to get your pricing technique right.

Before our corporation began looking into on-line marketing regarding fleece body warmers there didn’t seem the obvious choice of key phrase to use as our main focus.

Place

Place is the component of the marketing mix that is often disregarded by companies, but it’s still an important part of selling your product effectively. In short, it describes the method in which you provide your product to your customer, and subsequently how you collect money from them.

The most typical ramifications of place-based marketing are the physical locations in which your products are sold. For the majority of consumer products, this includes the distribution infrastructure between your manufacturing centres and retailers and other outlets around the country. Since distribution of a physical product costs money it is important to identify your own priorities and adapt your distribution network appropriately. This is the main use of this part of the marketing mix.

With the increasing use of the Internet by your potential customers, marketing strategies have had to take into account how they use the Internet to help deliver their products. By using the Internet as a point of contact (or even as an entire distribution route in download-based markets such as MP3s) firms are now able to reach out to a large pool of potential customers.

Promotion

When you mention the word “marketing”, many people immediately think of the promotional side of the marketing mix, although as we have seen, this is merely one branch of a more complete system. Promotion can be used on a very individual basis or as a mass communication instrument, and whilst it can be an expensive undertaking it is often an important one.

Advertising is one of the most common forms of promotion. Typically it would be done by posting on billboards, producing short clips for TV and radio or by physically distributing flyers or leaflets to potential customers. With the coming of the information age we have seen a great increase in promotion via e-mail and the Internet, or just as targeted advertising materials posted through your door. The potential for individualised advertising has never been so good.

Another significant part of promotion involves branding, which may not necessarily yield more sales directly, but relates back to one of the initial purposes of marketing; getting customers to pick your product over those of your rivals. When all other parts of the marketing mix are equal it could be branding that swings a customer’s decision.

Putting it into Practise

As previously mentioned each company is unique and will have different marketing requirements. By using a balance of the four P’s reviewed above you can take a good view of your own marketing strategy.