There are some things that any marketing plan simply must address. These are all the factors that position a business correctly and lead to sales. They’re the 5 P’s of marketing, AKA the marketing matrix. Business managers constantly re-enter the marketing matrix to ensure they’re providing value to their customers. Let’s go into how it all comes together.
Product, Price, Promotion, Place, People. Marketing requires all 5, otherwise, there is no marketing being done.
These are simply the products (or services) offered by your business. However, this first P of marketing is broken down into a few other steps. After all, the product is what you’re selling, and it needs to be well thought out for the last 4 steps to work.
Overall, the product P of marketing refers to the value offered to the customer. This includes several typical facets.
Simple. What does your product or service do? What problem does it solve? What makes it any different from the other products and services created to solve the same problems?
Branding is the image surrounding your products and what they are psychologically associated with. It is a distinctive feature of your business that is carried in its products.
Branding is constantly communicated to customers through aspects like packaging and product appearance. In terms of services, behavior and dress can play a key part in branding.
Your product or service has to offer some kind of quality. That doesn’t mean that it needs to be the best in the market. But it has to offer some kind of value that makes it competitive. For example, you can sell a worse product than any of your competitors and charge less than the rest of them for it, in many industries. In the end, you have to provide the quality to back up your brand’s promises. Whether it’s the fastest, the cheapest, the prettiest, or whatever else your customers are looking for.
In some industries, particularly electronics and household appliances, warranties are a crucial part of the first P. Customers make large investments into products that they expect to provide ongoing value for years. They should be able to rest assured that if there’s a defect, it’ll be dealt with.
Warranties can become products themselves. Often, companies offer a free one-year warranty, assuming that any true production defects will be revealed in that time. However, they can then sell extended warranties at a cost.
What does your product or service cost and how can the customer pay for it? Then, are there add-ons, and what’s their pricing strategy?
The second P of marketing covers every aspect of your pricing strategy. The goal is to make your product or service more attractive due to its price. This doesn’t always mean making it cheaper.
The simple, upfront cost of buying your product. This is determined based on market research; what are people willing to pay for it?
The selling price needs to be well-thought-out. Being too cheap or too expensive isn’t good. But the profitability of a product doesn’t start or end with its selling price.
Studies have repeatedly proven the effectiveness of discounts. People like free things as well, but discounts are addictive in a way that no other aspect of your pricing can be.
The discounts aspect of Price can include a mixture of:
Payment arrangements should depend on the cost of the product or service and its longevity. Some products should always demand full, upfront payment. But in many cases, breaking the selling price down into 6 monthly payments makes more sense. In other cases, an indefinite monthly subscription is a more appropriate arrangement.
You also need to make a decision regarding which payment methods are accepted. The wisest decisions are the ones based on evidence; what payment methods does your customer base prefer? What method would make them more likely to make a purchase?
Payment arrangements are grouped with business models. There are many different options available, and new ones have become popularised recently. These are normally industry-specific, such as monthly subscriptions being the norm in the digital streaming industry.
This is a popular aspect of online shopping. eCommerce companies and businesses like Booking.com often offer a price-matching feature. If the customer can show you the same product offered elsewhere for a lower price, you must sell it to them at that price. It’s a niche pricing method, but it works well for a few businesses.
With the first 2 Ps out of the way, you need to find a way to reach new customers. Promotion is the way by which you reach out to new potential customers. It’s a comprehensive process no matter which routes you choose. There are several subcategories to this 3rd P of marketing.
You can advertise your business and any specific products on many mediums. Long gone are the days of simply buying a TV or radio slot. The internet has fostered a new industry in internet marketing, now worth over $340 billion.
Your businesses choice of advertising medium depends on your industry and where the data shows you have the most potential. eCommerce companies typically keep their focus online, for obvious reasons.
There is no dead advertising medium yet. Depending on the size and nature of your specific business, any mix of the following can work:
Businesses engage in sponsorships all the time. When it’s applicable to your business and feasible, mutually beneficial sponsorships are a great opportunity. If you can sponsor a person or company whose customers or fans overlap with your customer base, sponsorships can kickstart and form the backbone of businesses, in some cases.
PR activities can be a relatively inexpensive way to create new customers.
Even with everything else prepared, it only pays when you’re in the right place. The 4th P of marketing covers your placement relative to your customers and competition. It includes your supply chain from your suppliers to your customers.
Which part of the market are you trying to corner? What can you realistically hope to achieve?
The internet and modern shipping make it easier to sell to everyone, everywhere. But actually selling to people everywhere is easier said than done. Most businesses can’t be Amazon, so market research is needed to determine which customers are worth spending resources acquiring. Your market coverage is connected to every aspect of your marketing.
Distribution channels are otherwise known as supply networks. Your business is inevitably a part of a chain of businesses and/or other intermediaries. You need to be able to consistently get your products and services delivered where your customers are willing to go buy them.
Whether virtual or brick-and-mortar, your location is everything. A modern business’s location is normally an address with a ZIP/postal code as well as an IP address. In both cases, a good location is:
Being in the right location at the right time is the goal. The key often comes down to accessibility. If customers can find you easily, you simply get more sales. This often comes down to simple things like having a store connected to a major route or making a website mobile-friendly.
Lastly, a complete marketing plan requires all the right people. In terms of marketing, the 5th P refers to all staff working in marketing, sales, and customer support.
Marketing professionals are required to map out everything listed above. Their work requires an in-depth analysis of each of the above categories. They understand what it takes to position your business in the market such that it can succeed with the market segments it’s targeting.
Salespeople complete the picture and ensure the bottom line is reached. They are representatives of your business as well. Sales professionals put their best foot forward to get you the sales that the rest of this infrastructure is meant to lead to. Without skilled salespeople, you cannot complete the picture.
Even with the highest degree of professionalism, businesses never run trouble-free. When customers in-store or online have difficulties, a good customer support team is needed to keep customers happy and preserve your business’s hard-earned reputation.
Customer service staff should be easy to find, whether inside your store or on your website. Salespeople should be provided an environment where it’s easy to find and communicate with customers and should be provided with any enablement service or training they need to adapt to changes, whether in location, online or recently, via Zoom meetings.
Customer support information should be easy to find on your website. It should plainly and clearly state contact information and operating hours.
A marketing team for a restaurant decides to charge more for a steak dinner. The steak dinner has been rebranded to come with higher quality beef, aligning with the luxurious brand of the restaurant chain.
A hotel chain with a hotel near a major casino provides a discount for stays resulting in referrals from the casino.
The marketing team at a shoe retailer launches a new Instagram page to reach out to younger audiences. They decide to focus on visuals that align with the company’s brand.
The marketing team at a major retailer decides to spend more money on a location closer to public transportation. They find that the extra cost in rent is offset by greater foot traffic.
A salesperson hears the chime as a customer walks in the door. The salesperson clearly sees customers inside the store, seeing what isles they’re in and thus knowing when to approach.
The 5 P’s of marketing are essentially the 5 Pillars. When they are professionally implemented after in-depth research, a business is far more likely to succeed.
These are the pillars that ensure a customer has: