The Four Ps of marketing

In the 1960s, the Harvard Business School discovered a number of company actions that influence the decision to buy goods or services. They suggested that the actions are a “Marketing Mix”, containing four elements: product, price, promotion and placement.

Product: The product aspects of marketing cover the specifications, and how they relate to the end-user's needs and wants. The scope of a product normally includes supporting elements such as warranties, support and guarantees.

Pricing: This covers the process of setting the best price for a product, including discounts. The price does not necesarily need to be monetary - it can be what’s exchanged for the product or service - time, energy, or a measure of attention.

Promotion: This covers web advertising, sales promotion, publicity, and face-to-face selling and branding, and refers to the various methods of sales promotion.

Placement (or distribution): covers how the product or service gets to the customer eg distribution or retailing. This fourth P is also called Place, referring to the channel through which it is sold (eg online or retail etc), which region or industry and which market segment (eg teenagers, families, business people etc).

These four marketing elements are often called the marketing mix, which can be used to create a marketing plan. The four Ps marketing model is useful for B2B both products and services. High-value consumer products require refinement to this model. Services marketing must also take account of the unique nature of the services.

B2B marketing must also take into account long-term agreements typically found in supply chain contracts. Relationship marketing attempts to accomplish this by looking at all aspects of marketing from a long-term relationship-building angle rather than looking at individual transactions.

The Seven Ps of Marketing

As well as the traditional four Ps (Product, Pricing, Promotion and Placement), services marketing calls upon an extra three, making seven in total and they are known together as the extended marketing mix. These extra three are:

People: Any person coming into contact with customers will have an impact on overall satisfaction. Whether as part of a supporting service to a product or involved in a total service, people are very important because, in the customer's eyes, they are generally inseparable from the overall service . As a result of this, they must be appropriately trained, well motivated and the right type of person. Other customers are also sometimes referred to under 'people', as they too can affect the customer's service experience, (eg at a sporting event).

Process: This is the process involved in providing a service and the behaviour of the people involved, which can be crucial to customer satisfaction.

Physical evidence: Unlike a product, a service cannot be experienced before it is delivered, which makes it an intangible item. This, therefore, means that potential customers could perceive that there is a greater risk when deciding whether to use a service. To reduce this feeling of risk, and improving the chance for success, it is often vital to offer potential cnew ustomers the chance to see what a service would be like. This is done by offering and providing physical evidence, such as case studies, testimonials or demonstrations.