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2.7: Using the Marketing Mix

  • Page ID
    16188
  • What you’ll learn to do: explain how organizations use the marketing mix to market to their target customers

    Now that we know what tools are available to create value, how can we use them most effectively? In this section we’ll cover a number of examples; later in the course we’ll discuss the role of the marketing mix in the planning process and in a range of specific applications.

    As you begin to understand each of the individual components of the marketing mix, remember that none of the four Ps operates independently to create value for the customer. For instance, a higher price will create higher expectations for the quality of the product or service, and may demand a higher level of customer service in the distribution process. Heavy promotion of a product can create greater awareness of the value that is expected, increasing the importance of the product delivering value. The right mix of components supporting the value proposition becomes very important.

    Photo of row of salon shelves full of hair-care products.

    How does an organization determine the right marketing mix? The answer depends on the organization’s goals. Think of the marketing mix as a recipe that can be adjusted—through small adjustments or dramatic changes—to support broader company goals.

    Decisions about the marketing-mix variables are interrelated. Each of the marketing mix variables must be coordinated with the other elements of the marketing program.

    Consider, for a moment, the simple selection of hair shampoo. Let’s think about three different brands of shampoo and call them Discount, Upscale, and Premium. The table below shows some of the elements of the marketing mix that impact decisions by target customers.

      Discount Upscale Premium
    Product Cleansing product, pleasant smell, low-cost packaging Cleansing product, pleasant smell, attractive packaging Cleansing product, pleasant smell created by named ingredients, premium packaging
    Promotion Few, if any, broad communications National commercials show famous female “customers” with clean, bouncy hair Differentiating features and ingredients highlighted (e.g., safe for colored hair), as well as an emphasis on the science behind the formula. Recommended by stylist in the salon.
    Place Distributed in grocery stores and drugstores Distributed in grocery stores and drugstores Distributed only in licensed salons
    Price Lowest price on the shelf Highest price in the grocery store (8 times the prices of discount) 3 to 5 times the price of Upscale

    A number of credible studies suggest that there is no difference in the effectiveness of Premium or Upscale shampoo compared with Discount shampoo, but the communication, distribution, and price are substantially different. Each product appeals to a very different target market. Do you buy your shampoo in a grocery store or a salon? Your answer is likely based on the marketing mix that has most influenced you.

    An effective marketing mix centers on a target customer. Each element of the mix is evaluated and adjusted to provide unique value to the target customer. In our shampoo example, if the target market is affluent women who pay for expensive salon services, then reducing the price of a premium product might actually hurt sales, particularly if it leads stylists in salons to question the quality of the ingredients. Similarly, making the packaging more appealing for a discount product could have a negative impact if it increases the price even slightly or if it causes shoppers to visually confuse it with a more expensive product.

    The goal with the marketing mix is to align marketing activities with the needs of the target customer.

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