Understanding the Marketing Concept at the “Street” Level

The Marketing “Mix” is an extremely useful tool that gives the entrepreneur the essential pieces necessary to market your new business. Simply stated, it addresses the who, what, where, when, how and why for your business.

The concept was originally developed in 1960, by professor E. Jerome McCarthy in a book entitled Basic Marketing: A Managerial Approach. The Marketing Mix can be defined as:

“...the actions a company takes to market its product(s) and/or service(s). Typically, it acts as a framework for breaking down the four key components of marketing — product, price, place, and promotion”.

This approach provides a systematic method to connect with your target consumer and understand your interaction as a business with them. Each time an adjustment is made to one element of the marketing mix, you can gain valuable insights on consumer interests, motivations and desires. These elements also give you a systematic way to evaluate your business in relation to your competitors.

The typical Marketing Mix (originally called the 4 P’s) consists of the following components:

Product

What is the item (good or service that you’re trying to sell?) what are the features and benefits? How do you KNOW anyone wants this product? (Demand) And who else sells a product similar to yours in the marketplace.

Price

What value is your product or service worth? And what is the ‘perceived value’ in the marketplace? Do you know the true cost to provide this good or service, including warranties, shipping, and any add-ons? How does your price compare to others? (cost versus benefit)

Promotion

How will you tell your prospective customers about your product? What is the best method to reach them? What strategies will you use to stand out against your competitors?

Place (Distribution)

How will your customers receive your product? There are many platforms to assist with this now (ie Amazon, Walmart, Wayfair), making distribution easier than ever. Which method is the most cost effective for your business? Have you considered returns, and how this aspect is handled?

A ‘Fifth P’?

Over the past few decades, marketers have begun to emphasize an often overlooked but important fifth “P” - People - to the marketing mix. People can be viewed as internal - your staff, and how they work together as a team - and external - consumers, their attitudes, beliefs and other psychosocial factors that connect someone to a product or service. External can also include suppliers, who contribute to the overall finished product, and partners, who may assist you to get your product to market.

Don’t expect to get your Mix right the first time. Experiment with the various elements to find what works best for you. Using the marketing mix is one of the most important steps in taking your business to the next level.

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How to use the 4 P’s at Street Level

As an example, imagine what happens when you adjust the pricing of your good or service. If you raise your price, and sales subsequently go down, your clients may be telling you that your offering is  considered ‘low value’, or that you have surpassed what they consider their “price point” for this type of product. However, if sales go up, your customers may be telling you that you may have been undervaluing your product.

Try this experiment with each aspect of the marketing mix; speak to your customers, and get their feedback when you implement each variation. Learning the various interactions between your product/service and your consumers, using each element of the marketing mix will give you invaluable insights that will help grow your business.