The marketing mix was originally known as the 4P marketing mix. The term first saw the light of day in 1949 thanks to Neil Borden. However, the marketing mix only got its “4P” label in 1960, when Edmund Jerome McCarthy formulated it. The world is constantly evolving, though, and this is doubly true for marketing, because people keep changing. It is therefore necessary to respond to their needs and demands. This is why we have recently come across the more advanced 8P marketing mix.
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The extended marketing mix
There are many definitions of the marketing mix. To get an idea of this kind of marketing, though, it helps to know what a marketing tool is. These tools, which marketing uses, are exactly what marketing mixes are made of. There are a great many such tools. Some are OFFLINE tools and others are ONLINE tools. They include many forms of advertising, competitions, samples, exhibitions and trade fairs, seminars, but also PPC campaigns, link building and so on.
The marketing mix then selects specific tools to meet a particular need. For example, when we talk about the promotion part of the marketing mix, there are many ways to make customers aware of a product, inform them about it, present it, sell it and so on. You can use offline methods or online methods, or a combination (which is, of course, the best option).
TIP: If you want to learn more about 5P, 7P, 8P and the latest trends in the marketing mix, be sure to try the recent book Channel Strategies And Marketing Mix In A Connected World, which is available online and also as an e-book.
PRODUCT, PRICE, PROMOTION, PLACE
As is well known, the 4P marketing mix originally consisted of: PRICE, PRODUCT, PROMOTION, PLACE. The terms come from English (price, product, promotion, place), hence the Ps. Put simply, the product is the basic building block of the customer’s need, and it must have its value, that is, its price. To sell the product, we need to promote it and then get it to the customer by some route, that is, a distribution channel. This is the basis of the marketing mix in its original form.
Over time, and as the economy and customers’ needs and preferences developed, it became necessary to extend the marketing mix. So other very important elements came into play. It is not just that we have something we need to sell. We also have to present the commodity we offer in some way. But at a time when there is too much of everything, promotion alone is not enough. Products and services are starting to have their “own brand”. Every little detail affects the customer in different ways.
Fact: It is no longer just about offering something cheaper, or of better quality, and so on. It is about making an impression with the packaging, choosing the right approach and emphasising it. Belonging to the “right group”, such as eco-friendly companies or local sellers. You need to know your customers’ values and target them. Follow them in cyberspace and know what they want.
The 5P marketing mix, people
Today we know that everything has its own dynamics and does not stay the same; everything adapts to change. Anyone who wants to succeed in any market must be able to adapt. That is why the marketing mix could not remain adequate with its original 4 components either. The first element “added” to the 4Ps was people, that is, PEOPLE. This is how the 5P marketing mix came about. It is about the added value of a product created by the people in a given company. Their approach, know-how, experience, service, conduct and so on.
In the past, it was quite common for a person to work for one company practically their whole life. Such people knew almost everything about their work processes and the company. They were the most experienced people, and others came to them for advice. Companies knew how to value such people. Unfortunately, this trend has changed considerably. People are focused on quick results, so they lack the patience to develop themselves within one company. And company management itself changes so rapidly that for some it is not even possible to know who is a good employee and who is not.
As a result, good employees often leave companies of their own accord or are dismissed, because a stream of new, young and so-called promising people is pouring into their positions. Knowledge of foreign languages and the ability to work with electronics take centre stage. Years of experience are often pushed into the background on the grounds that the company is changing too and must move forward. Fast, go-getting youth gets a chance alongside an older generation that rejects new methods. In some respects this may be a good thing, in others perhaps not.
Fortunately, many companies realise the internal wealth they have in their employees. In fields such as hospitality, various beauty services, tourism and so on, this element, PEOPLE, is extremely important. Skilled and enthusiastic employees can make companies money, just as unapproachable, unfriendly and inexperienced ones can cost a company a lot of money.
The 6P marketing mix, people and Packaging
So that gives us the 5P marketing mix, but that is not all. The set needed to be extended by something that has value at the final stage, that is, for the customer. This is where packaging, or PACKAGING, enters the scene. They say that PACKAGING SELLS. You surely know yourself how a product’s packaging affects you. It is an important part of selling. It can make an impression, attract, or express an attitude, for example towards the environment, or signal that a product is a luxury item. As you can see, the sixth P, packaging, is important.
6P marketing, an example
Let us take cosmetics as an example of 6P marketing. Today, several things are emphasised in cosmetics. They must be high quality, not tested on animals, ideally organic, kind to nature, and they should have “beautiful” packaging. This is a great opportunity to use the P for Packaging. With packaging, you actually express everything at once. It is “eco”, it is “luxurious” and, on top of that, affordable. The packaging uses natural tones so there is no doubt about the eco approach, and usually also beige and light pink colours, which create a sense of gentleness and care.
The 7P marketing mix, people, Processes, Physical environment
The 7P marketing mix recognises that it is not enough to have a product, set its price, promote it and get it to the customer “somehow”. This is especially insufficient for services. The 7P mix therefore cleverly adds people, processes and physical environment. In other words: the human factor, processes and the physical or material environment. We explained the importance of the human factor above. It is people who add value to the development, production and other processes that products go through.
PROCESSES
In 7P marketing, processes means all the processes a product goes through. Today we know that we pay for processes too. The way a product is delivered to us. The condition it arrives in. How quickly it is delivered. Who is responsible for IT support, development and resources. Today a product goes through far more processes than we might ever realise. And these processes need to be taken into account, because they affect what kind of product reaches you.
Processes are particularly important in services. The emphasis is on standardisation and greater adaptation to each customer’s individual needs. Also on specialisation, because improving quality and the approach to processes makes it possible to focus more on specific requirements. Processes also aim to broaden the offer and allow greater versatility.
PHYSICAL ENVIRONMENT
And finally, the environment. In some places you may see it called physical evidence, in others the material environment. This “seventh P” is essential, because people perceive their surroundings 80% visually. If you go to a restaurant, for example, that does not make a good impression on you, you will probably never go back. The same applies to how the people offering services are dressed. The material or physical attributes of a product or service have a big influence on whether we buy it or not.
Just as packaging is important for a product, this environment is important for a service. Such an element helps build the brand’s name and the opinion we have of it. At the same time, it is also its brand or calling card. You can tell what kind of company it is from its environment. It is the same, for example, with the use of colours in marketing and so on. A company identifies itself through its environment and sends various messages to its customers.
7P marketing, an example
Service marketing extended by 3Ps, namely people, processes and environment, is best demonstrated with a restaurant, for example. McDonald’s, for instance, is one of the companies that are masters of marketing. They have a product that “everyone wants”, they have “normal prices” and they use value meals and discounts. They have their brand, they use colour psychology and everyone always knows that it is McDonald’s.
They make a point of creating a friendly environment for their staff, so that the staff will in turn be cheerful and friendly to customers. This is where P for People comes in. The best employees are those who are happy and intrinsically motivated to move the company forward. That is one reason why working from home, or home office, is such a popular benefit right now, even though the employer has less control over the employee. The employer shows that it trusts the employee and gives them greater comfort.
Staff who try to be pleasant always greet you politely, thank you for your order and are friendly overall. Don’t expect a bored, fed-up waitress chewing gum and showing how much she dislikes her job. Employers from modern start-ups to established banks work on this. They know that an employee like that can cost the company a lot of money.
An essential part of McDonald’s is also the environment, the way the food is packaged and the staff uniforms. Everyone wears the same uniform, so you can recognise them. The restaurants have the same furnishings and the same marketing colours, and there is always a children’s playground outside. The interior is simple, tasteful and usually clean. There is greenery and there are muted colours that create a relaxed mood in the coffee corner. Everything has a clear purpose and a clear effect on the mind.
The 8P marketing mix, people, Packaging, Programming, Partnership
Clearly, every market segment has its own specific needs. That is why the 4P marketing mix cannot be applied to every area, and for some it is not enough. For services, it had to be extended to include the human factor, processes and physical environment. The 8P mix is mainly used in tourism. Here the marketing mix had to be extended to include the human factor, service packages, programming and partnership.
There is no need to explain at length why the human factor matters so much in this area. However, we should not forget that customer reviews play an important part here. It is worth remembering that we are not only talking about employees, travel agency owners and their management. Customers themselves also enter this interaction, and their feedback influences other potential customers.
Packaging has a slightly different meaning here than it does for a product. It is not about the wrapping. It is about a service package that is more attractive or better value for the customer. This can include various offers of accommodation, transport, meals, airport transfers, a tour representative and so on. The customer buys a complete package instead of buying each part separately, which makes the package better value.
By programming, we mean the techniques linked to the other elements of the marketing mix. These are the procedures, schedules, mechanisms, activities and tasks through which services are provided to customers. This also includes, for example, the holiday programme, courses during a trip, social events and children’s programmes, known as entertainment programmes. These things serve to make holidays more attractive, or rather the “package” on offer.
Partnership means cooperation between the companies, organisations and service providers involved in a holiday package. This kind of cooperation can reduce some costs, so the travel agency can then offer you a more attractive price. And it is not only the price that can be better as a result, but also your comfort and an easier way of arranging the whole trip. You may even be spared some of the necessary tasks.
8P marketing, an example
For the 8P marketing mix, customer reviews are a good example. How many of us browse travel agency offers without checking what others think of a particular holiday? Or we simply ask friends or colleagues: “Hey, where is it you go on holiday, and how do you like it there?” Today “everyone goes everywhere”, so reviews are the first thing we look at.
Of course, we are also interested in a better-value offer. We are not talking about “buy one, get one free” here. But it is worth checking whether the holiday includes a tour representative, entertainment programmes, refreshments on the flight, or perhaps the transport itself, or a free place for a child. These are all things we now expect to be included in the price, but we often don’t realise that they are all extra costs and are not always included automatically.
The extended marketing mix, how to use it
Whether it is the PROMOTION, PRICE or PROCESS element of the marketing mix, it is always important to know who the marketing mix is aimed at and in which market segment. For a purely retail product, you will choose a different marketing mix than for presenting a service you offer. You will distribute shoes differently from a seaside holiday. But always remember that marketing tools complement each other, and one alone is never enough.
It is a mistake to focus on just one marketing tool. Manufacturers or sellers often gradually discover that the tool they chose is actually unsuitable. You may end up using, and paying for, some tools for no reason at all. And where it would pay off, you remain blind, so to speak. It is better to have a marketing mix that is flexible in itself and also reflects changes in the market.
Because just as the market changes, so do the products and services themselves. Where a 5P marketing mix used to be enough, it will hardly be enough today, and so on. People change their demands, wishes and preferences. All it takes is for someone very influential to stop caring about packaging and switch to eco-friendly consumption, and your luxury packaging strategy is in ruins. That is why you need to be able to respond to changes in the market, which are very fast-moving today.
The marketing mix as a tactic
This tool, or rather mix of tools, is really a tactic. It is a way to reach consumers and increase demand for a product or service. So it is a weapon in the competitive battle that, depending on how well it fits, can bring you victory or defeat. That is why it is so important for companies to get the marketing mix right. Some companies underestimate this and lose out on big profits.
But it is not just about increasing your current number of customers. It involves much more. If you want to succeed, you also want to keep your position and even improve it. After all, you don’t want a thriving business for just a year or two. Ideally, you want it for life. That is why simply increasing the number of your customers is not enough. With marketing tools, you also try to keep your existing customers. Because one satisfied customer equals two potential new customers.
As a company, you also communicate with other parties. You build your position in society, with the authorities, among competitors and in relation to the environment. These factors must be respected. Companies are responsible to the world around them, so they can also use these tools to communicate in this area. Through their chosen marketing mix, they show what kind of company they are, what their goal is and what we can expect from them.
That is why it is good to see these marketing mixes as tactical tools. For some, they are also a cheaper way to achieve bigger profits. Because even a change in the message on the packaging can make a big difference. Or simply changing the distribution channel can bring you new customers. It is best to see your product as a whole and use a mix of tools that overlap with each other.
Marketing mix, people as the best example
Perhaps the most fitting example of how changing the PEOPLE element can work wonders is restaurants. Compare for yourself which restaurant you would go to. The lovely, clean one where a very pleasant and helpful waitress serves you and the food tastes heavenly? Or would you happily return to the dirty, smoky restaurant where nobody pays you any attention for half an hour and you would rather send your lunch back?
The answer goes without saying. People and their attitude to work can have fatal consequences for a company. However, their enthusiasm and satisfaction depend on the environment they work in. A good company is aware of this, and today many companies do not underestimate it. Whether it is packaging, attitude or the way things are made, today everything is simply visible and everything counts.
