Key Takeaways:

Marketing can absorb costs while producing little sales. Learn the 4 Ps of marketing to focus your business ventures and make your return on investment is high.

Product marketing can be a daunting area for entrepreneurs. There are many different forms and strategies, and each can be costly. Instead of using a uniform marketing approach, successful businesses create their own marketing mix. A marketing mix combines product, price, promotion, and placement to create a unique strategy for each product or business. Let's review each of the 4 Ps of marketing:

Product: Businesses are all about bringing value to consumers. Therefore, every product should solve a customer's problem or improve the customer's quality of life. Products can be tangible (a houseplant), a service (landscaping), or an idea (a beautiful backyard). Every business owner needs to ask themselves, "what sets my product apart from the competition?" Even if your product is brand new, your consumers have a finite budget. Why should they spend their hard-earned money on your product? Setting your business apart is known as avoiding commoditization. For example, a commonly commoditized product is toothpaste. All toothpaste essentially does the same thing: clean teeth. Theoretically, since all brands of this product do the same thing, they should all be the same price. If there is a discrepancy in price between brands, consumers should choose the cheapest alternative. Right?

Wrong! This is not what we see in the toothpaste aisle. There are various prices, and consumers don't always pick the cheapest one because toothpaste products have set themselves apart from the competition. Some specialize in gum care, teeth whitening, sensitivity, or children's tooth care. Toothpaste has avoided commoditization through specialty, flavors, quality, packaging, and color. What sets your product apart? 

Price: Despite what many business owners think, the price of a product should only consider costs and profit goals. Instead, it is helpful to look at competitors and understand their prices. Then complete a perceptual map to determine where your pricing should fall among the competition. Once you know what customers are willing to pay for your product, it is time to think about pricing strategies. Will you offer sales, BOGOs, or free trials? How will you justify the price of your product in the minds of consumers? Through the promotion, of course!

Promotion: The number one promotion rule is to have a target market. Target markets are specific demographics of the population who are likely to buy a product. For example, if the product is a plant-based protein powder, the target market would include people who go to the gym, athletes, people with protein issues, and people trying to eat plant-based and want easy solutions. Therefore, marketing efforts should be targeted at these groups. Focused marketing strategies save countless hours and funds that can be directed towards other aspects of your business.

In addition to target markets, all company promotions should be consistent. Whether the focus is on email, social media, conversational, or partnership marketing, the central message of all external communications should be consistent. For example, in 2008, Subaru repositioned itself in customers' minds through a new main message: "Love. It's what makes Subaru a Subaru." This message permeates Subaru marketing on its website, Facebook page, emails campaigns, commercials, and magazine ads. Whether the focus is on dog-friendly vehicles or keeping teenage drivers safe, Subaru focuses on its customers' love for their family and car. Subaru makes its campaigns more effective by targeting its marketing efforts on families and dog owners. So effective that they constantly see record sales.

Place: Product, prices, and promotion mean nothing if your customer cannot purchase your product. Placing your product in the right place at the right time is a challenging but essential task. For digital sales, shipping price and time play a huge role in customer purchases. According to Forbes, 50% of those surveyed will not purchase from a retailer if products are unavailable online, and 84% will buy just because shipping is free. 

These statistics make it hard to compete with giant retailers like Amazon and Walmart. But do not lose hope! Small businesses and start-ups have a considerable advantage: partnerships. Start-ups often partner with large retailers, tech companies, or other local businesses to boost sales and brand awareness at a low cost. We will do a deep dive into start-up partnerships in a few weeks, so stay on the lookout! Another method of success for small businesses is to sell on Amazon. Being an Amazon seller offers unique opportunities and advantages, especially for well-designed products. However, there are often many hoops and prices. Find out more about the pros and cons of selling on Amazon here.

Each product and business requires combinations of the 4 Ps of marketing to succeed. Determining your marketing mix is a helpful exercise that will save time, money, and stress. To start, try answering these five questions: 

  1. What sets your product apart from the competition?
  2. What is your product worth to consumers?
  3.  Who is your target market? 
  4. What is your central message?
  5. Where/how will your product or service be available?

With these answers under your belt, you'll be ready to face a competitive marketplace where you can locate and successfully sell to customers who value your product.

Jun 8, 2022
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