How the Marketing Mix is Used to Make Business Decisions

How the marketing mix is used to make business decisions? Combining the components of the marketing mix can help inform a company's decisions about its target market and the picture it wants to portray. Components of the marketing mix The main goal of marketing is to boost sales. To do this, companies can build a marketing plan by combining the elements of the marketing mix-product, price , location and promotion. Think of a marketing campaign as a cake that is baked with four ingredients. If the ingredients are put together in the right way, the marketing strategy is more likely to be effective. If one of the ingredients is not combined in the correct amount, the chances of success are smaller. Forgetting about one of the ingredients means a cake, or a marketing campaign, is unlikely to succeed. How the components of the market mix work in cohesion Each element of the marketing mix affects the others, so that messages across all elements need to be consistent. For example, it would be unlikely that a business selling luxury cruises to retired people would do well by advertising them at very low prices in teenage-oriented magazines. The need for consistency means that compromises sometimes have to be made when making decisions on the different elements. The Four P’S Product How the product is influenced How the price is influenced How the place is influenced How promotion is influenced If the commodity is costly to make, the price would have to be higher. If the product needs to be reviewed, it will be more effective if it is sold from a store. A new product may need more marketing than a mature product. Price If the price is to be poor, the quality of the product will be affected. It would not be prudent to sell costly goods through discount retailers. Place The commodity sold in luxury stores must be of high quality A commodity that is sold cheaply may be sold in discount stores. Promotion The Buy-OneOne-One-OneOne deal would not be acceptable for an expensive product. Promotions can be used to minimise the cost of goods at a high price. Expensive items could be ideally suited for marketing with a free gift. A product that is only sold online can involve a different approach from one sold in stores, e.g. more detail about the product. A promotion strategy that used national media would demand that the product be made available nationally HOW TO USE THE MARKETING MIX TO GET AND BUILD A COMPETITIVE ADVANTAGE OVER YOUR BUSINESS RIVALS The marketing combination is typically used to achieve a competitive advantage over other firms. A competitive advantage can be obtained by: ● ● To sell goods at lower costs than rivals Ensure that the product has added value in order to differentiate it from the rivals of the company. Not every product can have the lowest price possible. It is therefore necessary for companies to use the marketing mix to highlight other ways in which they have added value to their products and to make their products stand out from those of their competitors. This may include: Product – highlighting how the product is better than competing products , particularly if it has a unique point of sale (USP) Price – determining whether to charge the lowest possible price or to emphasise the quality of the product by charging a price that represents the quality of the product. Place – Selecting whether the product is widely available or sold in a smaller number of outlets Promotion – ensuring that the promotion operation is consistent and is consistent with the reputation of the brand that the organisation wishes to preserve. Many elements of the marketing mix may be more relevant than others, and this may vary depending on the product, the demand and the competitors. For example , a manufacturer of premium mobile phones may concentrate more on the features of the phone and on advertisement and brand promotion around it. On the other hand, the manufacturer of a budget cell phone is likely to place more focus on the price. HOW THE MARKETING MIX IMPACTS THE COMPETITIVE ADVANTAGES OF FIRMS By having a cohesive and integrated marketing mix, a company will have an effect on the competitive advantage it has over other companies. For example , a company that produces a new model of sports trainers might create a marketing mix outlined below: Product-Trainers are a modern, high-quality product made using the latest technology. They are made from a modern, lightweight fabric, hard-wearing but comfortable. Promotion-Trainers are highly advertised on social media, targeting those who are interested in running. Discount deals are available to members of running clubs, and customer feedback on the comfort of trainers are used in advertising. Place-Since they are primarily designed for athletes, trainers are often sold through specialised sports shops and websites that are popular with runners. Price-As a new product with unique features, trainers are priced significantly higher than competition, though discounts are available to some customers. This marketing mix for a trainer business would have a variety of strategic advantages, including the following: The site reassures users that these trainers are tailored for those who are serious about their running. By selling only through specialised shops and blogs, the company lets customers know that these trainers are not just fashion accessories. Further evidence that these trainers are tailored for runners is offered by advertising strategies that use media outlets that are likely to be used by runners. The product has a special sales point (USP) because the fabric made by the trainers is fresh and lightweight. This USP allows the company to charge a slightly higher price. And if the market is tough, consumers would pay for creativity.