The 4P´s

Why use the 4P´s

Marketing your business is no easy job, but if you spend a little time and effort before buying ads and engaging, you will probably achieve better results.

The 4P´s model is great to help you understand the situation of your business needs and in which direction you should move.

The 4Ps are:

• Product (or Service)
• Place
• Price
• Promotion

How to use the 4P´s

Analyzing each of the elements, will help you understand where you should focus your effort and which content you should use.

Below will you find a brief description of each element along with to guiding questions.

Product

When thinking about products you need to consider of your products or new products fits with your strengths and weakness (from your SWOT analysis).

• Do you have the right product to satisfy the needs of your target customer?
• Functionality
• Design
• Quality
• Packing
• Support
• How should you brand your product?
• What should you name your product?

Place

Getting the product to the consumer in best possible way. You should consider where in the value chain your role is, are you a wholesaler, retailer or...

• Where do people shop for your products or similar products?
• How do you access the right distribution channels?
• Can you offer your products in brick and mortar stores or through the web or maybe both?
• What is unique about your distribution platform compared to competition?
• How do you ensure customers get the right knowledge about the product, though salespeople, through youtube clips, or...
• Consider you products exclusivity, higher exclusivity equals exclusive distribution, while low exclusivity equals wide distribution?

Price

Charging the right price, which good for your business and accepted by your customers is tricky. There is a number of pricing strategies to consider.

Cost-plus: Adds a standard percentage of profit above the cost of producing a product.

Value-based: Based on the buyer’s perception of value. The buyer’s perception depends on all aspects of the product, including factors such as quality, brand perception and prestige. This strategy is often used by brand names. Starbucks is a great example of this.

Competitive: Having your prices and the same level as your competitors.

Going-rate: The prices charged by the going rate, means that majority of business can not affect the market rate. Consider renting property and example of this.

Skimming: If there is a product that is hot or hyped in the market, this will allow you charge a high price. Later in the products life cycles will you reduce the prices. Consider consumer electronics to use this strategy.

Discount: When a reduction is advertised.

Loss-leader: Some businesses benefit from having a loss leader to generate traffic. Other products will make up for the loss.

Psychological: Selling your product for an amount which feels like less than it actually is. Example 19,95 over 20,00

You can mix most of the above mentioned pricing strategies, but ensure to match them with your strategy.

Promotion

Promoting your product is about advertising and selling.

• How can you inform people about what you have for sale?

• Explain consumers need your product?
• Know about your business?
• Fill customer needs?

With market research, you will get to know about your customers and potential customers. Such research will help be efficient in the marketing spendings, where it is about being effective, you need:

• A clear message
• Target a specific segment of the market
• Use the right media channel

Next task

Now consolidate all your thoughts and notes into a document, which you hold on to. This document will feed into your marketing plan or media mix and be part of you business plan.

Before you move on the next step, make sure to discuss this with your associates the everybody understand and accept the direction.

When you are due to talk to media about your spendings, you are now equipped with a strong piece of research, which will help them make you effective with your spendings and scoring a nice MROI.