4Ps Marketing: Understand What It Is, How It Works + Examples!
The time has come for us to explain in this blog what the 4 Ps of marketing are and why they are so important. We’ll provide some examples to better illustrate this key advertising concept.
The 4 Ps were popularized in the 1950s by Neil Borden, an advertising professor at Harvard University. He actually called his idea The Marketing Mix.
Since then, the idea of the marketing mix has been adapted and improved. And expanded! The 4 Ps concept was actually created by Jerome McCarthy, a marketing professor at Michigan State University in the 1960s, who based his definition on Borden’s work. Both terms are still in use today.
The idea of a “mix” may be useful to understand the 4 Ps not as separate units, but as interlinked concepts affected by both internal and external factors, but they also affect each other.
Among the internal factors that influence the 4 Ps we could mention the very nature of the product, its stages and life cycle and the company’s goals and budget. As external factors we could consider our competitors, the availability or efficiency of the channels we use, our buyer behaviour and also some key aspects such as legislation and even our audience’s cultural habits.
What Are The 4Ps of Marketing?
The 4 Ps are Product, Price, Place and Promotion. It is believed that keeping in mind these four concepts helps sellers to build a solid marketing strategy.
One thing we must bear in mind is that the 4 Ps are not key performance indicators. Anyway, advertisers use the 4 Ps for finding the right KPIs. This happens because the 4 Ps have proven to be quite effective in helping identify what the audience wants, how people see a specific product, how our product is performing considering the competidors and many other key aspects of business management.
Some additional Ps appeared at some point. These were People, Process and Physical evidence. Alongside the original Ps, these concepts were meant to help advertisers to succeed in their business by identifying their barriers and overcome their challenges.
One day the Internet came and advertising changed forever. The digitalization of the world, the rule of algorithms, the automation of processes, the Internet of Things, artificial intelligence, the mobile revolution and many other recent developments completely affected the way people used to understand and do marketing.
All these changes, though, haven’t turned the 4 Ps into obsolete terms. In fact, the marketing mix is still valid and now we’re going to take a look into its components.
Well, this is the most basic aspect we can take in marketing. What are we selling? If we have nothing to offer, there’s no point in advertising.
Our product or service could either tend to fulfill an existing demand or even create a new one. Also, our product needs to have a quality, something that we can work with to highlight its benefits. Why is this product better than the ones our competitors are selling?
We’ll take three products and we’ll use them along this explanation while we break through the 4 Ps of marketing.
Case A: let’s suppose that we produce hand-made quality leather shoes and boots
Case B: we sell vegan cat food.
Case C: we offer Japanese massages.
Pricing our product is determined by a number of factors. We must consider all our production, storage and distribution costs, but also competitor’s prices and even political and economical situations that could affect any or all of the stages of our product’s life.
Nobody would disagree if we say that the ultimate goal of selling a product is to obtain a profit from it, right? So, the idea is to obtain more than we have invested. The question here is how much? How much can your profit be? How much are you willing it to be? Can your consumers afford it? Let’s use those three cases we’ve exposed earlier.
If we produce hand-made quality leather shoes and boots we may try to reach an audience that can afford the price we must set in order to cover our production costs. But if we want to expand our base of consumers, we may consider to start a promotional discount with a social media campaign, for instance.
We’re now selling vegan cat food. Our goal is to reach cat owners committed to the vegan cause or consumers of products and services related to veganism, vegetarianism, animalism, animal rights defenders and pet owners. Our audience may be used to paying a bit more for products that don’t contain animal components.
We are now working with Case C: we offer Japanese massages, but we have some well-established competitors in the area. If we have confidence in our product, an interesting pricing strategy will be to set a high place, higher than the ones from your competitors. This action, supported by a nice marketing campaign and branding, could help us establish ourselves as an exclusive service provider. A high pricing suggests a high-quality service. Customers interested in luxury services and products may develop interest in your business.
Once we have defined the price of our product, we need to decide where to place it. When the 4 Ps were created, advertising was more physical than nowadays. The reason is evident: the Internet happened.
If we take our hand-made quality leather shoes for example, the placement of our products will be determined by both main factors: where our buyers are and how much products we can produce and deliver. If our production is small, we may want to target an exclusive audience, willing to pay for exclusive products.
If we want the middle class to start buying our shoes, we could work with the idea of social status and refinement that our products implies. We could combine that concept with a discount.
A good location to place our vegan cat food could be vegan and vegetarian stores and markets. If we take an online approach, we may need to search for pages, forums, communities and social media groups of users interested in related topics.
Our exclusive Japanese massage service needs to seduce the town’s upper class. So, where should we advertise in order to reach them? The local golf club could be a good start. What about the city’s financial district? If we want to reach them on the Internet, we must understand their online habits.
This is the realm of advertisement. Welcome! We’ve talked a little bit already about promotion, though. We could not help it: the digital era made the boundaries between Place and Promotion quite diffuse.
How are we going to advertise our hand-made quality leather shoes? Remember: we wanted to target a middle class audience willing to pay a little more than usual for a pair of shoes. Our key concept is status. Which advertising channel could be the right one for us to advertise a product linked to self-promotion, status and with some amount of vanity? Instagram Ads may be the one.
What about our vegan cat food? We have placed our product in local markets and stores, but we need to think in a marketing strategy. There are plenty of groups and pages on Facebook centered around veganism, vegetarianism and animalism.
There are also a lot of other groups and pages about pet care. In fact, cats have a privileged status on the Internet. People love them. We could deploy a double strategy: we will advertise our product among vegans focusing on the importance of developing vegan alternatives for the pet food industry and we’ll promote the same product among pet lovers highlighting the benefits of vegan nutrition for them.
Back to our Japanese massage service. How do we reach our town’s higher class? Let’s physically advertise in the spaces they gather and let’s do digital marketing in the websites they visit. The local financial-focused journal could be a good start.
As we have seen, the 4 Ps are quite essential for developing a marketing strategy. More than 50 years after it was first formulated, this concept is still useful for digital marketers from all around the world.
What are your thoughts on the marketing mix? Do you apply the 4 Ps in your business? Comment on this article, we’d love to know your opinion. If you want to know more about digital marketing, save this blog. Click here if you want to contact our digital marketing team.