Product, place, price and promotion: the four Ps of the marketing mix are one of the first things taught in marketing classes.
They are long-standing elements of any advertising campaign or business model. Their goal is to get a product that meets the needs of a certain group of people in front of those people to generate interest so they are ready to buy.
This aligns with all of the principles of inbound and the buyer’s journey, but the 4 Ps were invented before the internet and were defined with brick-and-mortar stores in mind.
Stores that do really well are placed in heavily trafficked areas. Usually, there’s a sign out front promoting their products. Their prices are based on the needs of their intended consumers.
Other forms of media came into play over time, allowing for new forms of promotion and different types of advertising, but the store was still a physical place the consumer had to go, such as a drug store, an appliance store or an accounting firm. Marketing aimed to entice people to travel to the store and buy a product or sometimes, in the case of services, pick up the phone and make a call.
Now companies can be based online, and you can purchase physical goods and services without talking to people. This changes how the marketing mix operates, but the tenets still apply. It’s still incredibly important to understand the buyer’s journey, how your customers will be purchasing from you and how to be relevant to them at the right time.
How customers will learn about your product, where they can purchase it from, how much it’ll cost and why it's relevant to them still matter, especially with inbound. The definitions of the Ps themselves have changed to encompass the changes caused by technology.
Product traditionally refers to physical things like appliances or beauty products and services like cleaning or consulting.
Products have changed from being almost exclusively physical goods or physical services to online services. Traditional products like makeup and appliances still exist, but you can also purchase digital products like apps and software.
Services that used to have to be done in person or over the phone like consulting can now be done virtually, and new services exist like managed service providers and cloud service providers.
Technology has also enabled products to continue to evolve even after you’ve bought them. The only way to get an improved version of a traditional physical good is to buy the updated version — but now, the software can be updated after you’ve purchased it.
Now, rather than having a storefront or a location people have to go to, your website is your place — for example, no one ever walks into New Breed’s offices asking for marketing help, and we don’t expect them to.
Physical location is becoming less relevant than an online setting from a purely business standpoint. We can do business with anyone anywhere from where we are in Burlington, VT. The only limitations are time zones, which expands our market considerably from what it would have been if we had to meet with all our clients in person. In-person meetings do still happen, but they’re less of a necessity and more of a value add.
Places being websites is a complete game-changer in how the marketing mix is thought of today, and it’s impacting businesses that still rely on their physical location too. Consider an industry that will always have a physical location: restaurants. Restaurants primarily relied on foot traffic and word of mouth to find new customers. Websites have completely changed the way they reach their customers.
Think about the past few times you traveled somewhere. I’m willing to bet you searched for the best restaurants in the area at least once. Heck, I’ll even go online and search for the best restaurants in a random place and plan a trip around that. The point is, you may not “purchase” from a faraway restaurant online, but websites have enabled the restaurant industry to attract new customers from a wider range of locations.
Prices need to be based on both the real and perceived value of a product or service, with competitors offerings being taken into account. That hasn’t changed, and traditional pricing and promotional overlaps like punch cards and discounts are also still used by marketers.
Subscription pricing used to be less prevalent. You paid for the service you received at the time. You paid for an appliance, and then you owned the appliance. You bought on-premise software on a CD and then owned that software. You purchased a product, and you owned it; You buy a service, like a cleaning service, and they come to your house and clean. Then you pay them, and they leave.
Consultants were the first evolutions of this where you get a consultant on retainer, which is kind of like a subscription to that person, but you could also pay an hourly rate for consulting services.
Now subscription fees are more widely used. Instead of owning software, you have access to software through a subscription.
There are also new ways to approach pricing strategy due to the evolution of technology.
Many companies are adapting pricing models that allow people to try before they buy through demos, free trials and freemium models. All three allow people to use a product and see if it’s a good fit for their business.
There are companies who use freemium models and are comfortable having consumers who never pay a dollar for their business but may refer business or end up moving into a new role or new company and decide to purchase because the paid product is more relevant to them now.
SaaS companies have also started to include bulk pricing into their pricing model. The more of a particular product you purchase, the cheaper the unit price of that product. If you buy organic vegan gummies in bulk from Costco, the price per pouch of gummies is lower than if you only bought a six-count box from a grocery store. SaaS companies are pricing their products the same way so customers are buying for unit value.
For example, HubSpot’s Marketing Hub has different tiers with different amounts of contacts included. As you increase your tier level, the price per individual contact is less even though the overall cost of using HubSpot is higher, so you’re getting a better value.
Video hosting platforms operate the same way, but their value proposition is the number of videos you can host. Higher prices and plans include lower per-video costs: it might cost $200 for the plan that allows 20 videos or $850 for a plan that allows 100 videos.
For software where the value offering is the amount of time it's licensed for, bulk pricing is available in the form of annual prices instead of month-to-month rates. Software might cost $12 a month or $120 for the whole year, offering a lower cost for customers who purchase a larger quantity (in this case, the length of time they’ll use the software).
Everything you do for promotion is meant to bring people to your place to purchase from you.
Traditional forms of promotion included flyers, signage, radio and tv ads, magazine and newspaper ads, billboards and word-of-mouth that would drive people to your place.
Many of those forms are still utilized today, but they’re complemented by digital equivalents. Newspapers and magazines have online forms. Social media is like a digital form of word-of-mouth marketing. Banner ads are similar to billboards.
Promotion now works to make it as easy as possible for people to find you online. Promotional strategies include SEO, email marketing, blogging, partnerships, podcasting, video — all of the things that promote your business and everything you have to offer.
People are almost always on a device now. If they’re not on a device, they are quickly able to access one and go online. That means the whole idea of marketing has shifted.
The power is now in the buyer’s control, at their fingertips. That means marketers don’t have to push an offer in the moment as much as they did before. It’s more important to stay relevant so when buyers plan to make that purchase they think of you, rather than trying to force a product into their hands.
We now have access to people 24/7 through way more interactive and engaging channels than we had before. We can have a conversation with someone and get them to think about us through inbound methods like blogging, social media and emails.
The marketing mix aimed to get your offer in front of consumers at the right time, but the right time is no longer confined to traditional business hours. People can make a purchase whenever, so promotions don’t have to be right there in the store.
The in-the-moment criticality isn’t as high as it was before, which changes the way you need to think about the 4 Ps, but doesn’t eliminate their relevance.