The Marketing Mix. Components of marketing mix
Category: Marketing
The marketing mix describes the set of tools that a company uses to communicate with its customers. It refers to the distinct features of an enterprise that become visible on the market place. They are summarised by the four Ps: Product, Price, Promotion and Place.
Components of marketing mix
Product
The product needs to deliver value to the customer, or else it will not be bought. If it does not fulfil the expectations of the customer, he or she will not purchase it again. More over, word will get around to prospective customers and they will avoid the product. Therefore, careful development of new products and continuous improvement of existing products are vital.
Furthermore, not only does the basic product need to fulfil the customers’ expectations, but additional features and services are also expected (extras that add to the direct value of the product) The three dimensions of a product are summarised below:
Dimensions of a product
Installation
Maintenance
Repair
Technical advice
Quality Design
Technological sophistication Reliability/durability
Material Components Basic performance
Price
Siting the price has to be done after a careful analysis, taking customers’ perceptions, competitors’ prices and production costs into account. In addition, strategies for market penetration have to be considered.
Pricing factors
| Cost | Variable cost
Fixed cost Mark-up |
| Competition | Direct competitors
Lower-price segments of the market Substitutes from other industries |
| Customer | Price expectations
Fair/just price Past prices Quality perceptions |
For an existing product a price has normally already been established on the market place