The Marketing Mix

As a mnemonic for 'product', 'price', 'place' and 'promotion', the four Ps are often referred to as the marketing mix or the marketing program,represent the basic tools which marketers can use to bring their products or services to market.....
They are the foundation of managerial marketing and the marketing plan typically devotes a section to each of these Ps.
 
Origins

During the 1940s, the discipline of marketing was in transition. Interest in the functional school of thought, which was primarily concerned with mapping the functions of marketing was waning while the managerial school of thought, which focused on the problems and challenges confronting marketers was gaining ground.The concept of marketers as "mixers of ingredients," was first introduced by James Culliton, a Professor at Harvard Business School. 

At this time theorists began to develop checklists of the elements that made up the marketing mix, however, there was little agreement as to what should be included in the list. Many scholars and practitioners relied on lengthy classifications of factors that needed to be considered to understand consumer responses. Neil Borden developed a complicated model in the late 1940s, based upon at least twelve different factors.

Inspired by the idea of marketers as mixers of ingredients, Neil Borden one of Culliton's colleagues at Harvard, coined the phrase the marketing mix and used it wherever possible. According to Borden's own account, he used the term, 'marketing mix' consistently from the late 1940s.[38] For instance, he is on record as having used the term, 'marketing mix,' in his presidential address given to the American Marketing Association in 1953.

 In the mid-1960s, Borden published a retrospective article detailing the early history of the marketing mix in which he claims that he was inspired by Culliton's idea of 'mixers', and credits himself with coining the term, 'marketing mix'.Borden's continued and consistent use of the phrase, "marketing mix," contributed to the process of popularizing the concept throughout the 1940s and 50s.

The "marketing mix" gained widespread acceptance with the publication, in 1960, of E. Jerome McCarthy's text, Basic Marketing: A Managerial Approach which outlined the ingredients in the mix as the memorable 4 Ps, namely product, price, place and promotion.The marketing mix is based upon four controllable variables that a company manages in its effort to satisfy the corporation's objectives as well as the needs and wants of a target market.

Once there is understanding of the target market's interests, marketers develop tactics, using the 4Ps, to encourage buyers to purchase product. The successful use of the model is predicated upon the degree to which the target market's needs and wants have been understood, and the extent to which marketers have developed and correctly deployed the tactics. Today, the marketing mix or marketing program is understood to refer to the "set of marketing tools that the firm uses to pursue its marketing objectives in the target market".
 
Brief outline

The traditional marketing mix refers to four broad levels of marketing decision, namely: product, price, promotion, and place.

Product
    The product aspects of marketing deal with the specifications of the actual goods or services, and how it relates to the end-user's needs and wants. The product element consists of product design, new product innovation, branding, packaging, labeling. The scope of a product generally includes supporting elements such as warranties, guarantees, and support. Branding, a key aspect of the product management, refers to the various methods of communicating a brand identity for the product, brand, or company.
 
Pricing
    This refers to the process of setting a price for a product, including discounts. The price need not be monetary; it can simply be what is exchanged for the product or services, e.g. time, energy, or attention or any sacrifices consumers make in order to acquire a product or service. The price is the cost that a consumer pays for a product—monetary or not. Methods of setting prices are in the domain of pricing science.
 
Place (or distribution)
    This refers to how the product gets to the customer; the distribution channels and intermediaries such as wholesalers and retailers who enable customers to access products or services in a convenient manner. This third P has also sometimes been called Place, referring to the channel by which a product or service is sold (e.g. online vs. retail), which geographic region or industry, to which segment (young adults, families, business people), etc. also referring to how the environment in which the product is sold in can affect sales.
 
Promotion
    This includes all aspects of marketing communications; advertising, sales promotion, including promotional education, public relations, personal selling, product placement, branded entertainment, event marketing, trade shows and exhibitions.

Criticisms

Morgan, in Riding the Waves of Change (Jossey-Bass, 1988), suggests that one of the greatest limitations of the 4 Ps approach "is that it unconsciously emphasizes the inside–out view (looking from the company outwards), whereas the essence of marketing should be the outside–in approach". An inside-out approach is the traditional planning approach where the organization identifies its desired goals and objectives which are often based around what has always been done. Marketing's task then becomes one of "selling" the organization's products and messages to the "outside" or external stakeholders.In contrast, an outside-in approach first seeks to understand the needs and wants of the consumer.

From a model-building perspective, the 4 Ps has attracted a number of criticisms. Well-designed models should exhibit clearly defined categories that are mutually exclusive, with no overlap. Yet, the 4 Ps model has extensive overlapping problems. Some of the Ps are only defined in vague terms. Several authors stress the hybrid nature of the fourth P, mentioning the presence of two important dimensions, "communication" (general and informative communications such as public relations and corporate communications) and "promotion" (persuasive communications such as advertising and direct selling). Certain marketing activities, such as personal selling, may be classified as either promotion or as part of the place (i.e. distribution) element.Some pricing tactics such as promotional pricing can be classified as price variables or promotional variables and therefore also exhibit some overlap.

Other important criticisms include that the marketing mix lacks a strategic framework and is therefore unfit to be a planning instrument, particularly when uncontrollable, external elements are an important aspect of the marketing environment.
 

Modifications and extensions

To overcome the deficiencies of the 4 P model, some authors have suggested extensions or modifications to the original model. Extensions of the four P's include "people", "process", and "physical evidence" and are often applied in the case of services marketing Other extensions have been found necessary in retail marketing, industrial marketing and internet marketing:

•         Industrial marketing or B2B marketing needs to account for the long term contractual agreements that are typical in supply chain transactions. Relationship marketing attempts to do this by looking at marketing from a long term relationship perspective rather than individual transactions.

•         Services marketing needs to account for the unique characteristics of services (i.e. intangibility, perish-ability, heterogeneity and the inseparability of production and consumption). In order to recognize the special challenges involved in selling services, as opposed to goods, some authors advocate extending the model to 7 Ps for service industries by adding; Process – the way in which orders are handled, customers are satisfied and the service is delivered; Physical Evidence – is tangible evidence with which customers interact and with the potential to impact on the customer's service experience; People – service personnel and other customers with whom customers interact and form part of the overall service experience.

•         Retail marketing needs to account for the unique facets of retail stores. A number of authors have argued for the inclusion of two new Ps, namely, Personnel and Presentation since these contribute to the customer's unique retail experience and are the principal basis for retail differentiation. Some scholars also recommend adding Retail Format (i.e. retail formula) since it contributes to customer expectations.The modified retail marketing mix is often called the 6 Ps of retailing.

•         Internet marketing presents both marketing practitioners and scholars with special challenges including: customer empowerment, new communication modes, real-time interactivity, access to global markets, high levels of market transparency and difficulty maintaining competitive advantages. While some scholars argue for an expanded marketing mix for internet marketing, most argue that entirely new models are required.

•         Some authors cite a further P – Packaging – this is thought by many to be part of Product, but in certain markets (Japan, China for example) and with certain products (perfume, cosmetics) the packaging of a product has a greater importance – maybe even than the product itself.