Business Marketing
Practically every business on the planet sets out with the primary objective of making money. This is usually done by producing some form of product, or offering a service, and then charging people money for it.
First of all, it is a very rare case where a company can offer a product or service that is truly unique and cannot be provided by anybody else. This means that your enterprise will be competing with other businesses that sell a similar item and you will both be trying to earn money from the same shoppers, who only want to spend their cash once.
Marketing is the primary tool used by modern firms to draw prospective customers to do business with them and not with their competitors. It is a very extensive topic that is affected by a great number of internal and external factors, but when done right it can be the one business practice that could make or break a company.
So where should you begin when constructing a marketing strategy for your own company? Well, each situation is different, and each business will have its own set of advantages 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 called the “Marketing Mix”.
The Marketing Mix
The marketing mix was a term that was first coined in the 1950′s and is a phrase that is used to express the fundamental building blocks of any marketing system. It demonstrates the fact that marketing is not a straightforward, blunt-edged business tool, but rather a delicate balance of different aspects of business functions.
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 swiftly relate the elements of marketing to the strengths of their own organisations, and by doing so could very quickly create a tailored and efficient marketing strategy.
This marketing model is not restricted to physical items, services like balloon gas rental may profit via fresh marketing ideas or a new point of view.
Product
Although every element of the marketing mix is a requirement, the “product” element mentioned as one of the four P’s is possibly the most crucial of all. It describes the physical product or intangible service that your company will be selling, and at the end of the day it is the reason that customers are going to spend money with you.
Several people do not think that marketing has any role to play when it comes to the actual product that your company is selling. In fact, the common train of thought very often bears the exact opposite sentiment. Surely it should be the opposite way around – your manufacturing department creates a product for sale and then it is the task of the marketing department to discover ways to sell it, right? This is not always the case.
Consider the computer software market as an example. There are many established brands of both operating system as well as software application products in the marketplace already, and since the market is fairly well saturated it would be very tough (and expensive) to “take on the big boys”.
Rather than developing an operating system and then attempting to craft a marketing strategy to take on the likes of Microsoft and Apple, it would be more effective to look at what types of product are desired in the current marketplace, and how viable it would be to produce and sell them. By being mindful of the marketing mix early on in your product development period you can prevent business dead-ends at a later time.
Once your products have been designed and created it is still a vital 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’.
A different form of this part of the marketing mix is called product variation and is typically used to either lengthen 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 car industry uses this technique very effectively by offering various engines, trim packages and interior options with the cars that they offer. They use the marketing mix to great effect to sell their own products in an incredibly competitive marketplace. Whilst these companies may have substantial marketing budgets, the same principles can be applied to all companies.
It might seem evident that marketing is incredibly important for any balloon supplier similar to ourselves, but particular suggestions still need to be put into practice, which is not always easy.
Price
Another important factor in the marketing mix relates to the price of your products or services. This is not a simple case of performing market research to determine the highest price that your customers would pay (although that can be a handy tool to use), but rather making use of the price of your products as a strategic tool designed to achieve any specific objectives your business has.
Although it may seem obvious, it’s still worth pointing out that price has always been, and probably always will be, one of the key factors that shoppers take into account when they are making a purchase. It is also worth noting that customers don’t always consider the lowest price to be the best value. Actually a price that is too low can sometimes turn buyers away.
There are many questions that you need to ask yourself when devising a good pricing strategy, key among which are the price sensitivity of your customers, what your rivals are doing and how can pricing boost your own profits. From a strategy point of view though, pricing can be covered by two main principals; price skimming and penetration pricing.
Price skimming
The principal idea driving price skimming is to make as much money as possible from the sector of the market which is price-insensitive and will be willing to spend a premium amount of money to get a product or service early on.
This pricing strategy is very often 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 almost any price they wanted to and there would still be a loyal base of customers that would pay it.
Penetration pricing
Penetration pricing is at the other end of the pricing spectrum, and is geared towards gaining a large market share at a short-term cost so that financial rewards can be earned long into the future. It can be a high risk strategy, but when employed correctly it can setup revenue streams for many years to come.
Yet another thing to keep in mind is that “price” is the only part of the marketing mix that will generate earnings for a business. The other members of the four P’s will all cost money to produce or undertake.
Before our corporation started studying online marketing hand waving flags didn’t appear the clear choice of keyword to use as our main focus.
Place
Place is the portion of the marketing mix that’s often disregarded by companies, but it is still a significant part of selling your product successfully. In short, it describes the method in which you provide your product to your customer, and consequently how you collect money from them.
The most common ramifications of place-based marketing are the physical venues in which your products are sold. For the majority of consumer products, this involves the distribution network between your manufacturing centres and retailers or other outlets around the country. Since distribution of a physical product costs money it is crucial to identify your own priorities and modify your distribution network appropriately.
With the growing use of the Internet by your prospective customers, marketing techniques have had to take into account how they use the Internet to help distribute their products. By using the Internet as a place of contact (or even as a whole distribution route in download-based markets such as MP3s) firms are now able to reach out to a huge pool of potential customers.
Promotion
When you mention the word “marketing”, many people instantly think of the promotional side of the marketing mix, although as we have seen, this is only one branch of a more complete system. Promotion can be employed on a very individual basis or as a mass communication instrument, and whilst it can be an expensive undertaking it is often an essential one. The primary concern of promotion is to deliver a specific message that will boost sales.
Advertising is one of the most typical 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 witnessed a great increase in promotion via e-mail and the Internet, or just as targeted advertising materials posted through your front door. The potential for individualised advertising has never been so great.
Another significant part of promotion involves branding, which may not necessarily yield more product sales directly, but relates back to one of the initial purposes of marketing; getting customers to choose your product over those of your rivals. When all other parts of the marketing mix are equal it could be branding that sways a customer’s choice.
Putting it into Practice
As previously mentioned each company is unique and will have different marketing needs. By using a mixture of the four P’s discussed above you can take an effective view of your own marketing plan.