The marketing mix

A landlord who knows his or her target market will know how to provide the right product at the right price. The landlord will also have a sense of where and how much to advertise. A marketer who has selected a target market is able to plan a marketing mix to create successful exchanges with its members. A marketing mix is the mix of controllable marketing variables that the firm uses to pursue the desired level of sales in the target market.

The marketing mix consists of four elements: product, pricing, channels of distribution (placement), and communication (promotion). These elements are often called the "four P's" (for product, pricing, placement, and promo�tion). However, the terms that more accurately describe these elements amount to "two P's and two C's."

PRODUCT In the marketing mix, product stands for two things. First, it is the actual goods or services that marketers offer their target market. Second, it refers to the many ways in which those goods or services are enhanced to satisfy customers. Thus, cheese is a common product. Shredding it and putting it in a resalable bag make it conve�nient. Adding a label about its sodium content is helpful to health-conscious consumers.

Packaging and labeling are two major aspects of enhancing a product. Marketers make additional decisions about such attributes as color, style, and convenience. In this way, they create a product strategy�the decisions that involve the development of the product, its packaging, and its positioning in the marketplace.

PRICING The price of a good or service is its exchange value�that is, what the buyer would pay in exchange for the product. In most cases, price refers to an amount of money. However, in some instances the buyer might exchange time or other goods. Pricing is the function of setting prices that support the organization's marketing strate�gy. Pricing can be a tricky business: sometimes prices are regulated by government or industry standards, and prices are always subject to scrutiny by the general public.

Competition is a major factor affecting pricing, and "price wars" are common in many industries. In April 1992, American Airlines announced that it would simplify its fare structure, reducing its prices. Then in May, Northwest decided to undercut American's fares. American countered by beating Northwest's new rates. Meanwhile, consumers jammed telephone lines and ticket counters to get the best deals while they lasted. Competitors accused American of intentionally taking losses in order to drive weaker airlines out of business. Several considered antitrust suits against the company. Some industry people even began to say that it was time for the govern�ment to get involved in order to preserve competition. In the end, prices rose again and a number of airlines were thankful to have survived what was termed a "death struggle�.

CHANNELS OF DISTRIBUTION Marketers also plan how to get the product to the target market so that it will be convenient to buy. This element of the marketing mix is called channels of distribution (or placement). A strategy for channels of distribution includes a variety of activities such as transportation, warehousing, and inventory control. Sometimes the producer of the product handles all of these activities. At other times, the producer works with other organizations called resellers, intermedi�aries, or middlemen to make goods and services readily available to buyers.

Distribution is critical to a successful marketing strategy. No matter how good a product is, how fair its price, or how effectively it is promoted; members of the target market may not buy it if it isn't readily available to them.

COMMUNICATION (PROMOTION) To tell members of the target market how a product meets their needs and how they can buy it, marketers develop a communica�tion or promotion strategy. In this sense, communication refers to the element of the marketing mix that involves informing target markets about the organization and its products. The strategy for doing so consists of a communication mix that combines some of these elements:

�       Advertising

�       Personal selling

�       Sales promotions, such as coupons or gift offers

�        Publicity, such as the media coverage that results from press releases and news conferences.

The communication strategy has succeeded if members of the target market under�stand and accept the product message that the marketer is sending.

Sometimes the marketer combines elements of the communication mix in one promotional effort; encouraging consumers to try, sample, and then purchase. Such efforts are often a combination of advertising and sales promotion.