Business Marketing

Practically every company on the planet sets out with the main objective of earning money. This is usually done by producing some form of product, or offering a service, and then charging customers money for it.

First of all, it is a very rare case that a business can offer a product or service that is truly unique and cannot be provided by anybody else. This means that your business will be competing with other businesses that sell a similar product and you will both be trying to make money from the same customers, who only want to spend their money once.

Marketing is the main tool used by modern firms to draw potential customers to do business with them and not with their rivals. It is a very extensive topic that is affected by a great deal of internal and external factors, but when done right it can be the single business practice that can make or break a company.

So where should you start when constructing a marketing strategy for your own business? Well, every situation is different, and every company will have its own set of strengths and weaknesses that must be taken into consideration, but there is a marketing rule that can be applied to almost any corporation to be used as a marketing framework. It is known as the “Marketing Mix”.

The Marketing Mix

The marketing mix was a term that was first coined in the 1950’s and is an expression that is used to describe the fundamental building blocks of any marketing strategy. It reflects the fact that marketing is not a straightforward, blunt-edged business tool, but rather a subtle balance of different aspects 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 idea of “four P’s” that described the essential elements of the marketing mix. The formalisation of these P’s made it very easy for business managers and marketers to quickly relate the elements of marketing to the strengths of their own organisations, and by doing so could very quickly create a tailored and effective marketing system. The four P’s are Product, Price, Place and Promotion.

Our company specialises at supplying decorative concrete floors and while we believed our marketing strategy was adequate we have seen improvements after using marketing mix ideas.

Product

Whilst every element of the marketing mix is a requirement, the “product” element mentioned as one of the four P’s is possibly the most critical of all. It identifies 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 element is not adequately managed then your company will find it hard to survive.

Several people don’t think that marketing has any place to play when it comes to the physical product that your company is selling. In fact, the typical train of thought very often bears the exact opposite sentiment. Surely it should be the other way around - your production department creates an item for sale and then it is the job of the marketing department to discover ways to sell it, right? This is not necessarily the case.

Consider the computer software market as an example. There are many established brands of both operating system and software application solutions in the marketplace already, and because the market is fairly well saturated it would be incredibly tough (and expensive) to “take on the big boys”. So how can the principles of the marketing mix assist in this situation?

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

Once your products have been fashioned and created it is still a critical skill to be able to objectively review your own products to recognise the reasons why a customer would buy your product rather than a competitors’.

Another form of this part of the marketing mix is known as product variation and is generally used to either extend the lifecycle of a product already in the market, or to make your brand new product attractive to as many consumers as possible. Again, this method can be applied at all stages of product development.

The motor 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. Although these companies may have huge marketing budgets, the same concepts can be applied to all companies.

An example of one of the most recent forms of public marketing is this fish cooking website that provides versatile and accessible means to reach potential customers.

Price

Another key factor in the marketing mix relates to the price of your products or services. This is not a simple case of carrying out market research to determine the top price that your customers would spend (although that can be a handy tool to use), but rather making use of the price of your products as a strategic weapon designed to achieve any specific targets your business has.

Whilst it may seem obvious, it is still worth pointing out that price has always been, and likely always will be, one of the crucial factors that shoppers take into account when they are making a purchase. It is also worth noting that customers don’t constantly consider the cheapest price to be the best value.

There are many questions that you need to ask yourself while devising a good pricing strategy, key among 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 primary principals; price skimming and penetration pricing.

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 willing to spend a large amount of money to receive a product or service early on.

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

Penetration pricing

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

Yet another thing to bear in mind is that “price” is the one part of the marketing mix that will generate income for a business. The other members of the four P’s will all cost money to create or undertake. So it is even more essential to get your pricing strategy right.

When marketing your corporate website it’s important to pick a suitable key phrase. Beef cooking matched our business the best and we have made the appropriate marketing modifications.

Place

Place is the portion of the marketing mix that is often not addressed by companies, but it is still an important part of selling your product successfully. In a nutshell, it describes the method in which you provide your product to your consumer, and consequently how you receive money from them. It can be a great marketing technique when used appropriately.

The most typical implications of place-based marketing are the physical locations in which your products are sold. For the majority of consumer products, this involves the distribution network between your manufacturing centres and shops and other outlets around the country. Since distribution of a physical product costs money it is crucial to identify your own priorities and alter your distribution network appropriately. This is the primary use of this element of the marketing mix.

With the increasing use of the Internet by your potential customers, marketing techniques have had to consider how they use the Internet to help deliver their products. By using the Internet as a place of contact (or even as a complete distribution route in download-based markets such as MP3s) firms are now able to reach out to a huge pool of possible customers. Effective positioning of your product or service can therefore yield impressive economic results.

Promotion

When you say the word “marketing”, most people immediately think of the promotional side of the marketing mix, although as we have seen, this is merely one branch of a more comprehensive system. Promotion can be used on a very individual basis or as a mass communication tool, and whilst it may be a costly undertaking it is often an essential one. The primary concern of promotion is to deliver a particular message that will boost sales.

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 arrival of the information age we have seen a great increase in promotion via e-mail and the Internet, or just as targeted advertising material posted through your front door.

Another important part of promotion involves branding, which may not necessarily yield more product sales directly, but relates back to one of the preliminary functions of marketing; getting customers to pick your product over those of your rivals. When all other pieces of the marketing mix are equal it can be branding that sways a customer’s choice.

Putting it into Practice

As previously mentioned every business is different and will have different marketing needs. By using a mixture of the four P’s reviewed above you can take a good view of your own marketing strategy.