Broadly speaking, in order to maximise profits, different firms use distinct tools to perform strategy and decisions, such as SWOT analysis, PESTEL analysis and marketing mix analysis. In terms of the marketing mix, as an important concept in the subject of business studies, it refers to “a balance between the four main elements of marketing [is] needed to carry out the marketing strategy. It consists of the ‘4ps’: product, price, promotion and place” (Marcousé and Surridge et al., 2011:141). Firms can build an effective marketing strategy by using the marketing mix as a tool, and it is possible that business will fail if the marketing mix is not correct. The aim of the essay is to analyse elements of the marketing mix. Initially, it will discuss four elements, which are the product, price, place and promotion respectively. Then, it will evaluate the most vital component in the marketing mix, which is the product.
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The first component of the marketing mix is the product. “A product is a good or service produced by a business or organization, and made available to the public for consumption” (Ashwin and Merrills et al., 2008). Each product has a different feature, which could be the unique selling points of them. Roams and Cota (2008:152) attempt to define this term is, “A unique selling point (USP) is a short statement that explains why a customer should buy from you instead of your competitorsin”. For example, Apple Corporation has a unique and independent operation system for their iPhone.
It has been argued that there are three levels of product, first of which is core or generic product (Levitt, 1986:361). This is the basic and general physical product, in other words, it is the product that has minimum features and the consumer would expect it to have. In a microwave oven example, it should have enough space inside to put food and it would be expected to work effectively. The second level of the product is known as actual or tangible product. This is, touchable and physical property of the product. Young (2008:130) suggests this level of product will contain the product’s name, style, brand name, label, packaging and quality level. This level of product provides a material and a clearer image of the product to customers. The next and last level is called augmented product. Leader and Kyritsis (1990:12) explain this product provides privileges and additional
services to the consumer; it also can reflect the differentiation of the product. For instance, services such as free delivery, discounts and additional purchases.
The second element of the marketing mix is price. There are two main factors can determine the price of product, which is price elasticity and pricing strategy respectively. Blythe (2012:154) examines the elasticity of demand will illustrate that different categories have different extent of sensitivity when the price changes. Consequently, it could help firms make a better decision when they set the price. Thompson and Machin (2003:65) support that, “a business must know how responsive their products are to price changes so that they can assess the potential impact of, say, special offers or a price increase”.
The next factor is the pricing strategy. Also, it is more imperative than price elasticity when firms make their price decisions. Firms use a serious of pricing strategies, however, the pricing method of cost plus is used most commonly, which is the basic form of all pricing decisions. It refers to a business calculates the average cost and then add a mark-up to the final selling price. Ashwin and Merrills (2008:347) point out another price strategy is called discriminatory pricing; this means a firm set different price for different target groups. As the description from Thompson and Machin (2003:65), discriminatory price refers to “different price is charged to different group people at different times”. For instance, a cinema charges a different price for students and adults. Besides, it charges different for daytime and evening showings as well. In addition, psychology-pricing strategy is also used quite frequently in supermarkets. For example, Morrison’s sell a bottle of milk £1.99 rather than £2, hence customers will perceive the price as being lower. Levitt (1986) argues discriminatory pricing mainly relies on emotional responses from the consumer.
The third component in the marketing mix is the place. It concerns the way in which a product is distributed. Stimpson (2005:16) points out “the ‘place’ decision involves making the product or service available to consumers in the most appropriate way”. Distribution channel as the most important factor could affect the decision of the place. There are numbers of factors can determine how the product is distributed. Blythe (2012:173) suggests one of them is the marketing aim. The increasing scale raised enterprise intends to expand as wide a distribution as possible. Furthermore, legal restrictions should be regarded as well. Stone (2001) states there are numerous products are not permitted to sell in some places. For instance, it is forbidden to sell the alcohol at the petrol station.
In general, direct distribution, retailers, wholesalers and agent are four core channels of distribution. Direct distribution is the producers sell products to customers directly without intermediaries. Blythe (2012:175) explains this, “direct distribution channels are typical of personal services such as hairdressing”. For retailers, it is an organization that offers goods to customers. Tesco and Wal-Mart, for example. In addition, Koter (2005) describes that, in many market, wholesalers act as a link between producers and consumers. Wholesalers usually buy goods from manufacturers then sell goods to the final consumers or retailers. In contrast, agents do not actually purchase goods; they only help manufacturers to sell. Thompson and Machin (2003:80) claim that, “ agent never actually owns a product, they usually connect buyers and sellers and manage the transfer of the good”.
The final element in the marketing mix is promotion. Promotion is not only advertising but also a communication tool between producers and consumers. “promotion is about communicating with customers and potential customers” (Ashwin and Merrills et al., 2008:331). Promotion is essential for a product because it is able to increase the demand for products. Young (2008) suggests promotion can raise emotion, concern or awareness for products or issues. In addition, promotion can protect and preserve the market share as well.
The methods of above the line and below the line are two main types methods of promotion. As for above the line promotion, it refers to a firm uses the advertising media but does not has direct control. The most recognizable face of advertising is television. Because of it can provide the introduction of product with colorful images. Wolinski and Coates (2008:373) state that, “television has the advantage of being memorable, as it can present both moving images and sound”. Thompson and Machin (2003:74) examines the below the line promotion includes promotional media over which the firm has control. For example, personal selling, it means a salesman or a sales team who regularly visits consumers in person.
Having introduced each element of the marketing mix, the essay will now evaluate the most crucial element in the marketing mix – product.
There are two principal reasons for product as the most important element in the marketing mix. First of all, product as the key component makes the entirely process of the link between customers and producers possible. Amount of sales promotion and price reduction will not help an enterprise to achieve their market target if the product is not appropriate and attractable. Stimpson (2005:24) agrees with this view that, “ a balance and integrated mix is essential, but without a product that offers customers real and distinctive benefits, even the best-laid marketing plans can be wasted”. In the mean time, Kazmi (2007), in her work, Marketing Management, suggests that the product or service is the most vital element, without a good product, you have nothing. Furthermore, Adcock and Halborg (2001) sustains that the attention of customers will be attracted if a firm can develop a high quality product, hence, the profits that the firm makes will increase. As a result, the potential for business success is significantly enhanced.
The second reason is that products enable to decide a firm’s profits, sales, market share, image, reputation and stature. Additionally, product can also determine the scope and direction of a company’s activity. Product acts a heart in the whole marketing mix. Most of the scholars support that view. Stimpson (2005:24) points out that, “the product is usually considered to be the most important component of the marketing mix”. Stone (2001) believed that in most case the product itself is the key to a successful marketing mix. However, there will be instances that when other components dominate the marketing mix. Wolinski and Coates (2008:346) argues that, “ At a festival, only one type of bottled water might be available, so the place is the most important factor”. In contrast, Baker (1991) claims when consumer with limited money might choose the product with the lower price, this is due to consumer has insufficient resources to purchase additional products. In this case, price is the most significant component.
To recapitulate, the essay has introduced and analysed four elements – product, price, place and promotion in the marketing mix. Marketing mix as a tool is able to help firms make efficient business plan and strategy. Each element is playing a very vital role in the marketing mix. Furthermore, the essay has identified the product is the most crucial part since the product is the key component linking between the producers and consumers. It can be concluded that all the elements in the marketing are essential and necessary, while in the most case, product is the most essential component in the marketing mix. An enterprise should coordinate and integrate the four elements so that the firm can build an efficient marketing strategy and achieves more profits as possible.
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