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In the sequence of strategic analysis and decisions, "marketing mix" analysis falls after various external and internal environmental analyses such as PESTEL analysis, Porter's Five Forces analysis, SWOT Analysis and even formulation of competitive strategies (Porter's Generic Strategies).
Marketing mix is an imperative concept in modern marketing and academically it is referred to as the set of controllable tools that the firm blends to produce the response it wants in the target market, so it consists of everything the firm can do to influence the demand for its product (Kotler and Armstrong, 2004). It is important to realise that marketing mix strategy of any company can have one major function, that is, strategic communication of the organisation with its customers (Proctor, 2000). It was further argued that marketing mix provides multiple paths as such communication can be achieved either in spoken form and written communications (advertising, selling, etc.) or in more symbolic forms of communication (the image conveyed in the quality of the product, its price and the type of distribution outlet chosen). However, the key element is that the main aspects of marketing mix that will be discussed below "should not be seen as individual entities, but as a set of interrelated entities which have to be set in conjunction with one another" (Proctor, 2000: 212).

Main Aspects of Marketing Mix (100)

The easiest way to understand the main aspects of marketing is through its more famous synonym of "4Ps of Marketing". The classification of four Ps of marketing was first introduced and suggested by McCarthy (1960), and includes marketing strategies of product, price, placement and promotion. The following diagram is helpful in determining the main ingredients of the four Ps in a marketing mix.

  • Product

In simpler terms, product includes all features and combination of goods and related services that a company offers to its customers. So the Airbusproduct includes its body parts such as the engine, nut bolts, seats, etc along with its after-sales services and all are included in the product development strategy of the Airbus. However, a serious criticism can be raised here in terms of how marketing mix analysis will cater for companies such as ABN Amro Bank, Natwest Bank, British Airways and Fedex Corporation as they don't possess tangible products. It was argued that is it feasible to omit service-oriented companies with the logic that the term "services" does not start with a "P", however, it was asserted that these companies can use the terminology of "service products" under marketing mix strategy making (Kotler & Armstrong, 2004).

Lazer (1971) argued that product is the most important aspect of marketing mix for two main reasons. First, for manufacturers, products are the market expression of the company's productive capabilities and determine its ability to link with consumers. So product policy and strategy are of prime importance to an enterprise, and product decisions dictate the scope and direction of company activity. Moreover, the market indicators such as profits, sales, image, market share, reputation and stature are also dependent on them. Secondly, it is imperative to realise that the product of any organisation is both a component and a determinant of the marketing mix as it has a great influence on the other elements of the mix: advertising, personal selling, channels of distribution, physical distribution and pricing. So without proper product policy, a company can not pursue for further elements of marketing mix.

Pricing

Pricing is basically setting a specific price for a product or service offered. In a simplistic way, Kotler and Armstrong (2004) refer to the concept of price as the amount of money that customers have to pay to obtain the product. Setting a price is not something simple.  Normally it has been taken as a general law that a low price will attract more customers. It is not a valid argument as customers do not respond to price alone; they respond to value so a lower price does not necessarily mean expanded sales if the product is not fulfilling the expectation of the customers (Lazer, 1971).

Generally pricing strategy under marketing mix analysis is divided into two parts: price determination and price administration (ibid).

Price determination is referred to as the processes and activities employed to arrive at a price for a product including consideration of relative prices of products within the same line, and differences in price for similar products of differing grades and qualities.

Price administration is referred to as the activities involved in fitting basic prices to particular sales situations such as geographic locale, functions performed by customers, position of distribution channel members, or special sales situations. An example of this is special discounted prices at, for instance, GAP, NEXTetc or Coca ColaandPepsiwheredifferent prices are set in different geographical areas considering the difference in patterns of usage as well as varying advertisement costs.

Placement

Placement under marketing mix involves all company activities that make the product available to the targeted customer (Kotler and Armstrong, 2004). Based on various factors such as sales, communications and contractual considerations, various ways of making products available to customers can be used (Lazer, 1971). Companies such as Ford, Ferrari, Toyota, and Nissan use specific dealers to make their products available, whereas companies such as Nestle involve a whole chain of wholesaler retailers to reach its customers. On a general note, while planning placement strategy under marketing mix analysis, companies consider six different channel decisions including choosing between direct access to customers or involving middlemen, choosing single or multiple channels of distributions, the length of the distribution channel, the types of intermediaries, the numbers of distributors, and which intermediary to use based on the quality and reputation (Proctor, 2000)

Promotion

Promotional strategies include all means through which a company communicates the benefits and values of its products and persuades targeted customers to buy them (Kotler and Armstrong, 2004). The best way to understand promotion is through the concept of the marketing communication process. Promotion is the company strategy to cater for the marketing communication process that requires interaction between two or more people or groups, encompassing senders, messages, media and receivers (Lazer, 1971). Taking the example of Nokia, the sender of the communication in this case is Nokia, the advertising agency, or both; the media used in the process can be salesmen, newspapers, magazines, radio, billboards, television and the like. The actual message is the advertisement or sales presentation and the destination is the potential consumer or customer, in this case mobile phone users.

Limitation of Marketing Mix Analysis (4Ps of Marketing)

Despite the fact that marketing mix analysis is used as a synonym for the 4Ps of Marketing, it is criticised (Kotler & Armstrong, 2004) on the point that it caters seller's view of market analysis not customers view. To tackle this criticism, Lauterborn (1990) attempted to match 4 Ps of marketing with 4 Cs of marketing to address consumer views:

Product – Customer Solution
Price – Customer Cost
Placement – Convenience
Promotion – Communication

How to Write a Good Marketing Mix Analysis

To follow a simple and best approach for marketing mix analysis, it is imperative to understand the purpose of this analysis. So the basic key is to analyse the company's overall marketing strategy primarily through the strategies it follows under the 4Ps of marketing.

So the approach should be to keep equal balance in analysing all four elements of marketing mix. The following points should be considered while carrying out analysis:

  • While analysing a company's product, a common fallacy can be focusing on the final outlook of the product and that gives rise to a nave approach. Analysts should consider and analyse all major product decisions that the company may have carried out including quality, features, options, style, brand name, packaging, sizes, after-sales services, warranties, returns, etc. Moreover, the company's position, as well as marketing strategy in the market, can be judged on the basis of its product mix including width, length, depth and consistency (Proctor, 200). Width is the number of lines the firm carries, for example Sony has various lines including TV, video, cameras and laptops. Length is the number of items in the product mix, for example Toshibahas different types of TVs and laptops. Depth is the number of variants of each product offered in the line such as clock radios, car radios and pocket radios. Finally, consistency is how closely related the various product lines are in terms of the use to which they are put, more commonly including electrical and entertainment products. So, using these bases for product strategy classification will lead to easy and effective analysis. Finally, one should attempt to identify what the company is actually aiming at through its product. There can be three possible product strategies in a company's action (Proctor, 2000). Either it aims the product at the market such as Erickson with new mobile phones to cater for the business class; it can be given a "face lift" such as Marks & Spencer's attempt with more customer-specific products; and it can be withdrawn, discontinued or eliminated such as Marks & Spencer closing down its unprofitable units across the globe.
  • To write a valuable pricing analysis of a company, the key is to correlate its pricing strategy with its product position in the market. The company may use various pricing strategies such as penetration, skimming, competition-based pricing, psychological pricing, price wars, etc (Proctor, 2000). A company uses penetration prices if its product is entirely new to the market so it may charge low prices to increase market share. It may be observed that Porsche and Ferrariuse skimming pricing where they may charge a higher price as they know their specific customers will buy their product at any price. Sometimes companies have more fluctuating prices so an analyst should consider that their might be competition going on or a price war has broken through between rivals. For instance, Pepsi and Coke often indulge in such price wars. Sometimes psychological dimensions can be considered as well. Customers easily find products in Tesco, Asda or Sainsbury'swith price tags of 2.99 or 4.99 rather than 3 or 5 as customers may perceive them as 2 or 4. So the writer must analyse which of these strategies a company is following and for what reason.
  • Similarly, placement analysis requires the knowledge of a company's distribution channels, for instance analysis of the fact that a company is involving any middleman or not. If analysis of a consumer-good producer such as Nestle, Cadbury, and Colgate & Palmolive is carried out, there are high chances that a middleman will be involved considering the size of the market in target. However, industrial producers such as Airbus may opt for direct distribution considering the limited number of customers. Similarly, it should be noted that a company may be using a specific intermediary if the ease, reliability, image of the particular outlet, the way in which it performs and the deals which can be struck with the distributor are satisfactory. So, a company may choose C&A rather than Marks and Spencer, or Tesco rather than any other retail outlet (Proctor, 2000). On a general note, a very good analysis can be made if the placement related the six questions highlighted in previous sections are tackled.
  • Finally, the basic step in promotion analysis is to identify the communication objective that the company is aiming at. There can be multiple communication objectives that can be identified. One should analyse how the promotion strategy is aimed at creating awareness of the product or service, provision of product information, brand recognition, gaining access to a target audience that is inaccessible to a salesman, evoking desire for a product or service, merely making the selling task easier, overcoming prejudices, creating a reminder or to allay cognitive dissonance (Proctor, 2000). Once the communication objective is identified, then it is imperative to analyse the message and the promotional mix that is used by the company including advertisement, sales promotion, publicity and personnel selling. For Instance Nike very rarely uses personal selling due to its established brand awareness, however, it continually uses advertisements with communication objective of creating a product reminder. Contrary to that, Unilevermay use personal selling, advertisements as well as offering discounts (sales promotion) if it launches a new consumer good such as toothpaste or soap to cater for the communication objective of creating new product awareness.

Information for Marketing Mix Analysis

Students may seek information regarding market mix analysis (4 Ps) from two basic sources: market and academic. For market sources, information is easily available from a company's website, business reports, newspapers/published data on marketing, independent market survey reports and, in some cases, students may visit a retail outlet to analyse a product, its pricing and promotional strategies. However, to get more specific details, marketing and advertising academic journals and secondary data in the form of case studies can be the ideal source.

Conclusion

Marketing mix analysis is a fundamental step towards effective strategy. Where other analysis are more related to environment and feasibility analysis, the 4 Ps of marketing including the product itself, pricing, placement and promotion are the four wheels of the vehicle on which the path of an organisation's marketing  success is actually dependent.

References

  • Kotler, P & Armstrong, G (2004), 'Principles of Marketing', Tenth Edition, New Jersey: Pearson Education Inc
  • Lauterborn, R (1990), 'New Marketing Litany: 4P's Passe; C-Words Take Over', Advertising Age, Oct 1, 1990:26
  • Lazer, W (1971), 'Marketing Management: A Systems Perspective' New York:  John Wiley & Sons
  • McCarthy, E J (1960), 'Basic Marketing - A Managerial Approach', Illinois: Irwin
  • Proctor, T (2000), 'Strategic Marketing: An Introduction', London: Routledge

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