What is the modern marketing mix?

 

What is the traditional marketing mix?

E. J. McCarthy, in 1960, classified the marketing activities into a tool designed to describe the 4 types of choices an organization has to make in order to successfully be engaged in marketing. His classification was a simplification of Borden’s initial 12 component marketing mix.This classification is also known as the traditional marketing mix, or the 4P’s:

  • Product
  • Place
  • Price
  • Promotion

Product

The product is defined as the tangible (product) or intangible (service) item that a company offers on a certain market. At this stage of the marketing mix, a marketer considers: Product variety, Quality, Design, Features, Brand name, Packaging, Sizes, Services, Warranties and Returns.

Place

Place mainly refers to finding the right strategy of distribution and placement for the product or service offered. When considering what will make the product or service easily accessible to customers, a marketer must choose the following: Channels, Coverage, Assortments, Locations, Inventory and Transport.

Price

Price is defined as attaching the right monetary value to a certain product or service. A good pricing strategy will help the company differentiate from its competitors. Therefore, a marketer must decide upon: List price, Discounts, Allowances, Payment period, and Credit Terms.

Promotion

Promotion refers to all the activities a marketer must engage in in order to raise awareness of its product or service. It includes the following aspects: Sales promotion, Advertising, Sales force, Public relations and Direct marketing.

Updating the marketing mix – the modern marketing mix

Since the original 4P’s of the marketing mix was developed in the 1960s, the profession of marketing has significantly developed and become far more professional. Therefore, an extension of the traditional 4p’s is required in order to have a more complete understanding of the function and role of marketing within an organization.

In order to modify the marketing mix to reflect the evolution of marketing in the last decades, Philip Kotler has proposed a broader view of the of marketing mix and proposes that an additional four elements should be included:

  • People
  • Processes
  • Programs
  • Performance

People

In this context, by people there are two different categories:

  • The employees of the company: thus emphasizing the importance of internal marketing – the marketing activity reflects the value of the employees working at a particular company;
  • The customers: in order to develop a truly efficient marketing strategy, marketers need to see their present and future clients as people – thus underlining the importance of understanding the complexity of consumer behavior;

Processes

The marketing activity implies several processes each and every one governed by creativity, discipline and structure. Therefore, a complete set of rules and guidelines should accompany each marketing activity. Seeing and planning each activity as a process will reveal a more effective marketing and will also be the foundation necessary for acquiring new insights and creating unique products or services.

Programs

In Kotler’s vision, program reflects all the old 4P’s and many other activities required to market a product or service. The integration of all these activities is absolutely necessary in order to reach a higher development of the company. The 4P’s mustn’t be treated separately, they should be regarded as one.

Performance

Performance is defined as analyzing and measuring the financial and non-financial implications of the possible outcomes of an activity or decision. In addition to this, Kotler emphasizes the importance of analyzing the implications beyond the company itself, thus taking into consideration: social responsibility, the community or legal and ethical issues.

The original 4P’s model is ideal for optimizing the marketing mix of an organization due to its ability to address key questions. The newer formula presented by Kotler will apply to all the disciplines in a company, facilitating the alignment of the entire set of activities.