A marketing strategy is a company’s battle plan in the struggle of market competition. However, its task is in effect to outline the way the company plans to act in the market, which is made in a general way. To realize the marketing strategy, a company develops a marketing mix, which is a set of marketing tools used to influence the demand for the product (Kotler et al 2008, p.49). The first formula of the marketing mix included four elements, so-called 4Ps, which were: Product, Price, Place, and Promotion. Gradually the notion of the marketing mix has been extended to 7Ps by adding such elements as Processes, Physical Evidence, ad People (Schneider & Bowen 1998, p. 213).
Product is a service produced by the company; it can be tangible or intangible, produced on a large scale or individually. Each product has its life cycle, which includes the stages of development, introduction, growth, maturity, and decline (Kurtz, MacKenzie & Snow 2009, p.341). Each of the stages requires specific marketing decisions. Another important point is a product’s competitive advantage, which also defines the product’s marketing: it helps to expand the company’s market segment and to increase the price.
Price is not simply the cost of the product for the buyer; it is a point of communication between the producer and the customer. Price defines the product’s position in the market, informing the client about its quality and originality. Depending on a good’s parameters and the life cycle stage, different pricing strategies can be used (Bangs 2002, p. 72): premium pricing (high quality or unique products), penetration pricing (lowering the price when entering the market), economy pricing, and price skimming (the product is new or has a strong competitive advantage). There are also some alternative approaches, such as psychological pricing ($99 instead of $100), optional product pricing (setting price for the additional services), etc (Armstrong et al 2009, p. 328).
The element of Place outlines the approach of the product’s distribution and includes the distribution chain which delivers the product from the manufacturer to the customer (Kotler et al 2008, p. 50). The product can be sold directly to the customer or the dealer; the shop can be physical or virtual. The place is defined according to the peculiarities of the product sold.
Promotion is a set of tools that help to communicate to the client, which is to attract his attention, provide information about the product, and stimulate the decision to buy. The company can use such tools as direct selling, personal selling, public relations, advertising, sponsorship, etc. As a rule, they are used in complex (p.51).
Schneider and Bowen emphasize the meaning of the last 3Ps: these factors help to overgrow the marketing of products and services and embrace marketing of the whole organization with its attributes, such as people, tangibles, etc. (1998, p. 213).
The component of People includes the company’s staff with its skills and knowledge. The staff which has appropriate interpersonal skills and attitude to the work, as well as the professional competence, creates an additional competitive advantage, becoming a face of the company.
Processes also make the company competitive, increasing the customers’ loyalty. They include efficient service delivery which meets the needs and requirements of the clients, for ex., preparing a burger the way a client wants (Strydom 2005, p. 196).
Physical Evidence implies taking care of the services’ performance which influences the judgments about the company. Providing a clean environment of the restaurant or comfortable accommodation for the college students, as well as the website and brochures about the company’s service or a logo at the ticket, are examples of this element (Strydom 2004, p. 197).
Some attempts to extend 7Ps to 9Ps take place (Dacko 2008, p. 335); however, the additional elements are disputable: for example, Packaging can be considered a separate element or be included in the category of the Product, and Professionalism can be combined with People.
References
- Armstrong, G et al 2009, Marketing: an introduction. Harlow, England, Financial Times Prentice Hall.
- Bangs, DH 2002, The market planning guide: creating a plan to successfully market your business, product, or service. Chicago, Dearborn Trade Pub.
- Dacko, SG 2008, The advanced dictionary of marketing: putting theory to use. Oxford; New York, Oxford University Press.
- Kotler, P et al 2008, Principles of marketing. Upper Saddle River, N.J., Pearson Prentice Hall.
- Kurtz, DL, MacKenzie, HF & Snow, K 2009, Contemporary marketing. Toronto, Nelson Education.
- Schneider, B & Bowen, DE 1998, Winning the service game. Boston, Mass., Harvard Business School Press.
- Strydom, J 2004, Introduction to marketing. Lansdowne, Cape Town, S.A., Juta.