It’s been over 15 years since I took my very first marketing class in college. Yikes that makes me feel old.
15 years (think the year 2000). Kids, that was before Facebook. Before Google (as we know it). Before Wikipedia. Before social media period. Hell, I had an ancient Nokia phone that couldn’t text!
The marketing landscape as a whole has changed drastically in the past decade and a half. Digital marketing is real, not a future prediction.
Anyone who took marketing 101 classes in college were taught the 4 P’s of Marketing – Product, Place, Price and Promotion. I thought now was as good time as ever to refresh our memories and take a look at these from our current prospective – the digital age.
Your product is what makes your business. If you had nothing to sell, you wouldn’t have a business to run. Every business should have a clear definition of what their product (or service) is. For some it’s easier than others. Retail shops knows that their clothes are their product. However someone like myself that offers a range of services, should define what their core product is.
If you look at this from the digital side, it’s not much different, except in the promotion of the product. If you are active online, you now have a worldwide audience so you need to know how your product would relate to someone on the other side of the world.
Here are some questions to ask about your product(s):
- Is it what your customers want?
- How are you & your products different? What’s your purple cow?
- What are you selling?
- Are you adding value?
- Are you thinking outside the box?
With the internet, some companies can be global companies, which really makes defining their “place” hard. For local businesses, this is easy, but those like myself who could work with anyone around the world…well, it’s hard to figure out. If you have global potential, I suggest starting off locally and branching out from there.
If you want to have a successful business, you really have to know your trade area – who lives there? Do they stay local to shop? Is the area growing or shrinking? All of these need to be taken into consideration when you start your business.
You also need to look at your competition.
Do you have direct competition, meaning other businesses just like yours? What about your indirect competition? This is where it gets a little gray. Indirect competition includes factors that are out of your control. Examples: Job loss. Increase in expenses. Gift cards. These are factors that would make them want to spend their money somewhere else because of an outside circumstance.
It’s also wise to keep an eye on your competition’s actions and their reputation. You can use that to your advantage if needed.
Some questions to ask about your place:
- Do you know your trade area?
- What are your trade area’s demographics?
- Who are your customers? Are you B2B or B2C?
- Who is your competition and what are they doing?
Pricing is important. When you set your prices, you need to take into consideration your value and your cost in the item. You want to be (and stay) consistent – don’t confuse your customer with a lot of specials and discounts. Your goal is to eventually turn them into happy-to-pay-full-price customers, not condition them to be used to waiting for an annual sale with deep discounts or waiting until your coupons come out the 5th of the month.
Knowing what kind of pricing model to use will also help you, especially if you are thinking about having a sale or bundling products. There are three different kinds of pricing models that are most commonly used –
Discriminatory Pricing. This is when you charge different prices for different groups. Examples: Military Discounts, Senior Citizen Discounts, Educator Discounts.
Promotional Pricing. This is sales pricing.
Psychological Pricing. Common examples of this are BOGO items; Buy One Get One Half Off; bundling products when there really isn’t a discount and using pricing like $4.95 instead of $5.
Some pricing questions to ask yourself:
- What is your pricing model?
- Do you know the difference between the various pricing models?
- What can you do in your business that is free to your customers?
Without promotions it would be hard to get people into your store or to buy your service(s) no matter if it’s online or in real life. With any promotion that you use for your business, 3 objectives need to be kept in mind –
- To inform/educate
- To persuade (this is where relational or emotional marketing comes in)
- To remind.
If you are not hitting one of those objectives, you need to re-evaluate what you are doing.
I attended a marketing breakfast a few months ago and our speaker told us, in reference to business campaigns, the goal of any promotion or campaign is to create AIDA.
Of course I loved this because it’s something easy to remember. I just wish I had thought of it first – ha! Every business wants their promotion to stimulate an action. Making sure your campaign/promotion creates AIDA will help it meet that goal.
Some questions to ask:
- What are your promotion’s objectives?
- Is you campaign creating AIDA?
- Are you using effective advertising?
I hope you are using these 4 P’s in your business and marketing plan. If not, you need to go back and fix it. Each of these relate to the other. Knowing what the 4 P’s are for your business is a foundation to your business’ success.
Confession time – do you know them? To be honest, I had never written mine out until I wrote this post. So then, what are yours? Share with us below in the comments.