The lack of knowledge by small business owners about the marketing mix is extremely shocking. Considering that the marketing mix is one of the most important models of the marketing function, it is difficult to understand why so little attention is placed on the model by small businesses.
Let me just say this, understanding this concept is not a privilege reserved for marketing professionals only. Every business owner needs to know and appreciate how the model works.
I am therefore going to discuss this area of marketing to help you see how implementing the marketing mix model can add value to your own business.
The marketing mix is simply a mix of controllable elements of the marketing plan. The Model focuses on the analysis of 5 core ingredients of the marketing mix, Product, Price, Promotion, Place, and People.
Now let us discuss each of these elements of the marketing mix.
This element allows the business to focus on the product that the business offers to customers. Does the product meet the requirements of the customers?
The analysis of this element allows you to look at every aspect of the product that you are selling to your customers. Is it good enough? Is it easy to use? How can you make it better for the customer?
Put yourself in the shoes of the customer to understand how they would feel about receiving such a product, designed in that fashion, packaged that way and delivered through that channel.
Would you be happy as a customer about the product? Understanding how customers feel about your product is the best way to come up with an appropriate product that customers will love.
What is the point of coming up with the best product if customers are not going to afford the price being charged for it. Getting the right price for your product is one of the most important aspects of marketing.
You simply have to get it right. Price it too high and you lose customers, price it too low and you lose money, price it just right and you make a good profit and build a good solid customer base.
Focussing on the product`s price will also give you an opportunity to look at all the factors that influence that price. Of particular importance in that regard is the cost of the product to you.
If you want to offer the best price to your customers, one of the best ways to achieve this is to lower your own production costs. That way you can then pass on the savings to your customers.
This element focuses on how you can reach the right target audience with your message about the product.
Your communication has to be designed so as to provide as much information about the product as possible, to your customers so as to assist them in making buying decisions.
However one of the factors that come into focus when you analyze promotion is the cost of that promotion effort. How much will it cost your business? How much more will you sell as a result?
Your framework for determining promotions` costs must have a system that enables it to measure and record the resultant effect of that promotion effort.
Don’t just throw money at the promotion if you cannot measure the impact of that spending on your business. Look at promotion spending as an investment whose return can be clearly ascertained and stated.
This element analyses the logistical issues of how your business serves its customers. This element looks at how you move your products from supplier or manufacturing to your warehouse and how you then get that product to your customers.
Again it all boils down to how much all this costs. Understanding your distribution logistics will help you to create an efficient distribution system that will not lose you money. Poor distribution networks are notorious for haemorrhaging money.
Therefore you as a small business owner should regularly audit your distribution networks to ensure that you optimize the efficiency with which you get your product to your customers.
This is sadly one of the most ignored elements of the marketing mix by businesses. It`s almost as if they actually don’t know its impact on their business.
This element involves an analysis of your people, that is, your staff and everyone that is associated with helping your business to serve its customers. Do the people in your business make a customer`s visit to your business, a memorable one, or one to quickly forget?
Let me tell you this right now, good customer service is one of the cheapest ways to increase your customer base. It costs nothing to smile and be pleasant to your customers yet it guarantees that they will come back.
Funny enough frowning and generally unpleasant staff will actually cost your business money because customers simply won`t return. What this simply means is that you are paying people to lose you money.
We don’t need a College degree to work that one out now, do we? It`s just common sense. Therefore you have to make sure your people are competent enough to give the customer the best possible service.
So why is it called a mix?
Well, it is a mix in the sense that every element within the framework cannot be separated from the others. They cannot be analysed independently.
That is to say when you make a decision about one ingredient you have to also look at how that decision will affect all the other ingredients. All the elements are locked to each other and what you do with one directly affects the others.
For example, if you want to make a decision to lower the Price of a product, you have to consider how that will impact on the other elements.
Your Promotions element will need to be adjusted to communicate the new offer and it may need to be intensified so it may require additional spending to make sure the message about the offer timely reaches the right audience.
Your distribution would also need to be adjusted to accommodate the anticipated surge in sales as a result of the new offer. So as you can see, a decision about Price will end up affecting almost all decisions about the other elements in the mix.
What is the right mix?
The right marketing mix is one that, offers the best product, at the right
price, communicated effectively to the right target audience, and distributed
effectively by warm, customer caring staff.