Marketing Mix: The 4Ps Of Marketing For Businesses

What is a marketing mix?

Marketing mix refers to the mix of factors that are deployed together as part of a firm's marketing strategy. By strategically blending these factors, a marketer can influence a customer's decision to purchase their product or service. 

Harvard Business School professor Neil Borden coined the term marketing mix and used it in his presidential address to the American Marketing Association (AMA) in 1953.

What are the 4Ps?

A marketing mix can consist of any combination of factors, but most commonly refers to what is known as the 4 Ps of marketing: product, price, promotion and place. Each of these four Ps can influence a consumer's decision-making. 

E. Jerome McCarthy introduced the 4 Ps of marketing his 1960 book, Basic Marketing: A Managerial Approach.

By thinking systematically about product, price, promotion and place, marketers can take luck out of the equation. The 4 Ps framework and the concept of a marketing mix can be a helpful way for marketers to think about and build a successful launch and marketing strategy.

Breakdown of the 4Ps of Marketing: Product, Price, Promotion and Place

Before thinking about how these four key elements come together for a fully fleshed-out marketing plan, it's important to understand each of them individually.

#1 Product

Product is what you're selling, whether it's physical goods or intangible services. But when you think about your product, you should also be considering the experience that users have with your product. 

These are all questions that can help you clearly define what you are offering.

• Why would someone choose your product over competitors? For example, does it taste better or is it packaged or priced better?

• What problem does it solve?

• What attracts people to your products or services?

• Is the experience of the user the same as the experience you're selling? 

 #2 Price

The price of your product is what it costs. Sellers want to charge as much as possible, and buyers want to pay as little as possible. The price of the product is a compromise somewhere in the middle, between what sellers want and buyers want. 

The key is to find that sweet spot, because setting the right price for your product or service is crucial. Charge too little, and you might enjoy a high volume of sales but lose out on profit. Charge too much, and sales might dwindle.

The price of your product also influences brand positioning, or the way users perceive your product, as well as their more rational cost-benefit analyses. If your product is underpriced, consumers may question its effectiveness or think that it's too good to be true. On the other hand, if you price your product too high, especially compared to similar products from competitors, consumers may wonder if the price is fair. Unless you are an established legacy brand, you'll find it hard to make a sell—and even legacy brands have to keep an eye on current trends or be left behind.

There are many different pricing strategies you can use to set the right price for your product or service. But regardless of the approach you use, it's always a good idea to do your homework.

Ensure you have a good answer for the following questions.

• What does it cost to produce and distribute your product? At minimum, you don't want to charge less than what you're spending.

• Is there high consumer demand? Demand drives price.

• What industry are you in? Some industries, like the wedding industry, are notorious for markups while others are less forgiving.

• What are your competitors charging, and do you want to charge more or less?

#3 Promotion

The best product and the perfect price alone aren't enough. Promotion covers all the communication tactics that you use to tell people about your products and services.

This includes the promotional messages themselves, but also the audience the messages are addressed to, the medium, and the distribution channels.  These questions cover the factors you should consider when thinking about your promotional strategy: 

• What will the message contain? A promotional message shouldn't just tell people that your product exists. It should provide all the necessary information they might need about the product, such as the problem your product solves and how it benefits users. 

• Who is your target audience? Are you addressing a 65 year-old retiree, or a teenager?

• What medium is your message in—text, video, or audio? 

• What channel are you using to get your message out? Tiktok or a full-page newspaper ad? Podcasts or email newsletters? Online or mobile advertising?

• When will all this happen? Seasons and broader social changes all influence the way consumers think about purchases. 

You might notice that all of these questions are related to each other. For example, your choice of promotional channel will likely depend on who your target audience is. 

Note that promotion isn't synonymous with marketing. Promotion focuses on how you communicate your product to people. Marketing consists of more than promotion, as the 4 Ps of marketing show, and promotion needs to be thought of in tandem with the other Ps. 

At the same time, promotional activities also encompass more than just marketing. Promotion might also involve the sales process, public relations, and advertising. 

#4 Place

Place is where your buyers can find your product. From the marketer's perspective, it's where you'll be distributing your product or service, whether that's a brick-and-mortar location or an online shop.

It's not enough to be thoughtful about the where, however. Thinking about place means thinking about the ideal distribution system as well as the final destination. You also need to consider the how. Going through the following questions is a good place to start:

• How will customers find what you are trying to sell?

• Will it be sold in retail stores or exclusively online? 

• Will you be selling directly to consumers or wholesalers?

• Will you have your own shop, whether online or offline, or will you sell on a marketplace like Amazon or through an intermediary? 

The answers to these questions will influence not just your overall marketing strategy but also your business strategy. For example, questions of logistics are related to how you plan to distribute your product, and to where.

But as with many other things, it's not so easy to go from knowing the model to successfully putting it into practice. Below, we take you through the steps of applying the 4 Ps to a viable marketing strategy. 

Step 3. Choose the right price

Pricing your products and services can be tricky. This in part because pricing conventions differ wildly depending on industry, season, individual brand, and other factors. We're not here to take you through the ins and outs of these complexities. We do, however, have a list of basic questions to help you get started, whether you're an individual freelancer or the head of a small team.

• What are the production and distribution costs per unit?

• What's your revenue goal?

• How much money do you expect to make?

• How much would my target customer be willing to pay?

• What are your overhead costs?

• How much do your competitors charge?

• What is a typical price for the industry?

If you have the sort of business where the transaction ends in a one-time purchase, a single price may be enough. For example, if you're running a banana stand, you only need to set the price for a banana. 

If your product or service is something that can be exchanged through a single transaction, perhaps a single price may be enough. For example, you might only have to set the price for bananas at your banana stand, or the price of a one-hour session at your portrait studio. 

Some products and services, however, require a more comprehensive pricing plan, one where customers might be charged for ongoing access to a service rather than a one-time license. If so, you might need to opt for a subscription-based pricing model, and consider how frequently you'll charge your customers.  

For example, Toggl Track has monthly and annual subscription-based pricing, where customers are charged based on the number of users and the size of the business. Toggl Track pricing is also tiered, meaning that the price changes depending on what features you choose to sign up for.

This subscription model is comparable to other enterprise and freelancer apps on the market, but it is still competitively priced.

Step 4. Promote and sell

The first consideration for promotion is: Where and how will you sell your product? Sales should inform promotion.

And any consideration of sales and promotion should include considerations of the following: 

• Where are my ideal customers?

• What's the best way to reach them?

• What are my competitors doing?  

Toggl Track is an online app. We focus on digital sales directly through our site and promote our product online, through paid ads and select social media. We don't need a brick-and-mortar location, and a highway billboard just doesn't make sense for us—but neither does a Snapchat promotion.

For decades, the marketing mix and the 4 Ps of marketing have been a recognized business staple. When used effectively, the 4 Ps framework can provide a solid foundation for your marketing and business development strategies, especially if you're trying to build one from scratch. As you might have noticed in our step-by-step guide, the 4 Ps work best when you put customers first. 

Is the 4 Ps Model Right for Your Business? Here Are Some Alternatives

The concept of the 4 Ps is decades old. A lot has changed since these four marketing mix elements were first introduced in the 1960s. Some have questioned whether the 4 Ps model is outdated, especially in an era of digital marketing, mobile technology and changing markets and consumer attitudes. 

Others created spinoffs of the original 4 Ps model, such as the 4 Cs or SAVE model, examples of marketing mixes that aim to offset these limitations. We cover them below.

The 4 Cs model

The 4 Cs model is a marketing mix strategy that shifts the focus to the perspective of the customer rather than the seller. The four Cs are customer needs, customer costs, convenience and communication.

Robert F. Lauterborn introduced the 4 Cs in 1990, announced that the 4 Ps were outdated proposing the 4 Cs as an alternative marketing mix.

As the marketer, argued Lauterborn, you should forget about the product of the 4 Ps and consider the customer. When you break this down into a thought process, it looks like this:

• Instead of product, you should be thinking about customer wants and needs.

• Instead of place, you should be thinking about the convenience of the customer. 

• Instead of price, you should be thinking about what it costs the customer to satisfy these needs.

• And instead of promotion, a one-way street, you should be thinking about communication.

The SAVE framework

The SAVE in the SAVE model stands for solution, access, value, and education. This marketing mix strategy also consists of four elements, and was also proposed as a superior alternative to the 4 Ps model. SAVE also shifts the focus away from the product to the consumer.

According to the 2013 Harvard Business Review article introducing the SAVE model, the 4 Ps model can be limiting for B2B businesses because of its excessive focus on product. According to the authors, customers are increasingly looking for comprehensive solutions.

When you break down the SAVE model into a series of elements to focus on, it looks something like this: 

• Instead of product, you should be thinking about solutions. Your product might have hundreds of features, but which features specifically solve real customer needs?

• Instead of place, which suggests a fixed location, you should be thinking about access for customers.

• Instead of price, which is just a number, you should be thinking about value, which encompasses the customer's perception.

• And instead of promotion, you should be thinking of education. You win the customers over by giving them useful information and empowering them to decide rather than merely plying them with ads. 

The 7 Ps framework

The 7 Ps of marketing add three Ps to the original four: packaging, positioning, and people. Brian Tracy discusses the 7 Ps in his 1998 book Million Dollar Habit.

According to Tracy, in addition to product, price, place and promotion, marketers should also be thinking specifically about how the product is packaged, how the product is positioned, and about the people who are involved in the entire process. 

The marketing mix to rule them all

The 4 Ps or the 7 Ps? Or ditch it all for the SAVE model? Or an entirely new revamp not included in this guide? Why are there so many acronyms in marketing? 

The good thing is that you don't necessarily need to pick one, because these models are  all essentially just that: models. They can guide you into thinking about your marketing strategy, but creating the strategy is up to you.

Say your friend is developing a marketing strategy for her new business. What should she put in this plan? 

Whether you begin with the 4 Ps or Cs, it's often easier to begin with a list of questions or a four-step guide--such as the one we provide above--rather than from a blank slate. 

It's important that your marketing strategy remains current, and that you're able to adapt to new trends and technologies. But never hurts to have a strong grasp of the basics. Despite multiple spin offs, the 4 Ps of marketing remain a staple template in the design of a marketing plan.