THE MARKETING

MIX: THE 7PS OF

MARKETING
OBJECTIVES
Define marketing mix
Enumerate and
explain each of the
7Ps of marketing
MARKETING MIX
 Isa widely accepted strategic marketing
tool that combines the original 4Ps with the
additional 3Ps in formulating marketing
tactics for a product or service
 Original 4Ps: product, place, price,
promotion
 Additional 3Ps: people, packaging, process
The 7Ps are employed until the
entrepreneur finds the right
combination that will most
effectively serve as customers
needs and wants and at the
same time achieve the
profitability objective.
The 7Ps are controllable
by the entrepreneur and
therefore must be well
thought of to be
successful.
IMPORTANCE
OF 4Ps and 3Ps
The 4Ps were used in
marketing products
or physical goods
only.
The3Ps were used in
marketing services
Only few products are
pure products and only
few services are pure
services
Therefore, marketing mix
will be able to address
marketing components
both goods and services.
ACTIVITY: Identify
which 7Ps the
following key
questions belongs:
What product or
service is the most
appropriate for the
opportunity?
What location is best
suited for the business
where there are more
potential customers?
Why is it the
customers will buy or
avail the products or
services?
Can the customers
conveniently
transact on-site or
online?
What is the
appropriate price for
the product or
service?
How is the process of
distribution of products
or performance of
services?
What pricing
strategies will be
used for target
customers?
Which advertising
tool should be used
to drive awareness
and increase sales?
What type of
people need to be
hired?
What is the most
effective advertisement
or combination of
advertisements?
What are the
basic skills needed
for the job?
What leadership
skill will be applied
by the
entrepreneur?
What physical
evidence does the
entrepreneur need to
set up so as to sell the
service?
What is the most compelling
feature of the product or the
business that will make a
difference in the lives of the
customers?
What is the best packaging
for the product that is
attractive enough to
customers and cost-efficient
at the same time?
What sets the
product or service
from the rest?
PRODUCT
Aproduct is any physical
good, service, or idea that is
created by an entrepreneur or
an innovator in serving the
needs of the customers and
addressing their existing
problems
The product should
not be created
before finding the
right customers.
3 LEVELS CONCEPT OF
PRODUCTS OR SERVICES
The core benefits of the products
or service – are the major factors
why the customer buys a product
or avails of a service
3 LEVELS CONCEPT OF
PRODUCTS OR SERVICES
Physical characteristics of the
product or service – packaging or
better physical evidence or
customer experience for services
3 LEVELS CONCEPT OF
PRODUCTS OR SERVICES
Augmented benefits of a product
or service – additional benefits that
distinguish the product or service
from the competitors
PLACE
The place refers to a location
or the medium of transaction.
A strategic location depends
on the nature of the business
and the primary target market.
2 TYPES OF LOCATION
Physical location – areas population,
the traffic, the peoples common
paths, peoples buying behaviour,
peoples preferences for the location
Wi-Fi access, spacious area for
parking
2 TYPES OF LOCATION
Cyber location – the entrepreneur
must use Web analytics data to
understand Website performance
Number of visitors, duration of their
stay on the Website, frequently visited
contents
Place also covers the
product distribution and
the whole business
logistics
The logistic side of products
should cover production,
ordering, and receiving raw
materials or finished goods from
suppliers, storage, reorder
points and transportation
systems)
The logistic side for services
covers physical evidence,
service providers and
service delivery process as
well as policies and
procedures of the business.
One of the major objectives of
the entrepreneur for place is to
provide customers with
pleasant experience in buying
the product or availing of the
service so that they will keep on
coming back on-site or online.
The entrepreneur should
place the product or
service depending on the
needs of the customers
and on where the profits
will be maximized.
The entrepreneur
should also have a
reliable supplier for the
distribution of products
or services.
The place, whether on-
site or online, should
also be presentable,
appealing, and catchy
PRICE
Price is the peso value that the
entrepreneur assigns to a certain
product or service after
considering its costs, competition,
objectives, positioning and target
market.
It is the only P in the 7Ps that
generate revenue for the business.
COMMON PRICING STRATEGIES
 Bundling  Psychological
pricing
 Penetration pricing
 Premium pricing
 Skimming
 Optional pricing
 Competitive pricing
 Cost based
 Product line pricing pricing
 Cost plus pricing
ACTIVITY: Identify what
pricing strategies is
being described by the
following statements
Two or more products or
services in one reduced
price (3-in-1 coffee = 8
pesos, manicure and
pedicure = 150 pesos)
Two or more products or
services in one reduced
price (3-in-1 coffee = 8
pesos, manicure and
pedicure = 150 pesos)
Settinglow prices to
increase market share,
but entrepreneur will
eventually increase the
price once the desired
market share is achieved
Pricesare initially high
and then they are
lowered to offer the
product or service to a
wider market
Benchmarking
prices with the
competitors
Pricing different products
or services within a
parallel product array
using varying price points
Considers the
psychology and
positioning of price in the
market ( 199 instead of
200)
Setting a very high price
to reflect elitism
(exclusiveness) and
superiority
Adding an extra product
or service on top of the
original to generate more
revenue
The basis of mark up is the cost
of sales
cost of coconut juice (10) +
plastic container (4)
cost of coconut juice (20) +
plastic container (6)
The mark up is based on a
certain percentage of cost
 50% mark up
cost of coconut juice
(14x50%=7)
The new price is 14 + 7 = 21
 GENERAL PRICING
GUIDELINES TO MAKE A
BUSINESS SUSTAINABLE
AND THRIVING
Do not price the
product or service
below its cost
Monitor competitors prices
and ensure that your prices
are at PAR with them unless
the product or service is
really way superior to the
competitors
Align prices with the
other 6Ps (product,
place, promotion,
people, packaging,
and processing)
Implement price strategies
that are relevant to your
market segment (ex: tingi
(sachet) prising is most
appropriate in locality or
barangay)
Alignprices with
your business
objectives
PROMOTION
Involves presenting the
products or services to
the public and how these
can address the public
needs, wants, problems
or desires.
Theprimary target
market should be
identified because it will
become the main
audience
The major goal of
promotion is to
gain attention
PROMOTIONAL TOOLS
Advertising
Selling
Sales promotion
Public Relations
ADVERTISING
Type of communication that
influences the behaviour of a
customer to choose the product or
service of the entrepreneur over
the competitors
ADVERTISING (Objectives)
Informing, educating and
familiarizing the public with the
product or service offerings
Building a trustworthy image
Increasing sales
There are so many ways to
advertise the product or service,
but the challenge for the
entrepreneur is to choose which is
the most cost effective and
targeted channel to relay the key
marketing message to the target
market
Television – regular
channels, cable TV
Radio
Internet – emails, websites,
blogs, social media
Mobile phones – text messages,
mobile applications
Print – newspapers, magazines,
flyers, directories, signages, posters
Out-of-home – billboards, buses,
bus stops, trains, train stations, taxis,
street advertisements
SELLING
The act of trading a
product or service
for a fee
SALES PROMOTIONS
Short term promotional
gimmicks wherein practical
incentives and appealing
activities are incorporated to
entice the customers to buy the
product or avail the service
SALES PROMOTIONS
Below the line promotions
Implemented when the
entrepreneur needs to
reach a certain sales
quota
SALES PROMOTIONS
Sales discounts or
discount coupons
Raffles
Contest and games
Promo items
SALES PROMOTIONS
Sample distributions or
free taste/free trials
Premiums (ex: free toys
for fast food meals)
SALES PROMOTIONS
Point of purchase
promotions (ex: display
stands in grocery store)
Rewards (ex: reward
cards)
PUBLIC RELATIONS
Image building initiatives of the
entrepreneur to make the name of
the business reputable (trustworthy)
to stakeholders (customers,
government agencies, business
partners, media, public)
PUBLIC RELATIONS
Press conference
Launching events
Community events
Lobbying (good relationship with
gov’t officials
 PEOPLE
Play a vital role in servicing customers
eve though the entrepreneur sells only
physical good
It is not about the quality of products
anymore, but how employees serve
customers
PEOPLE
Employees have become
a major influence in the
customers buying
behavior
PACKAGING
How the product or service is
presented to customers
It is the overall identification
(look and feel) of the product or
service
PACKAGING
This will determine the uniqueness
of the product from competitors
This is the first element that the
customer see because they don’t
know what is inside yet.
PACKAGING
Serves as the shelf life
of the product or
service
PACKAGING
Itsgoal is to entice (tempt)
customers to purchase the
product or service
The entrepreneur should
focus on pleasing the
customers eye
PACKAGING
Important in selling physical
product or goods as it
establishes the brands
identity
PROCESS
Defined as the step by step
procedure or activity workflow to
effectively and efficiently serve
customers
Components: input, throughput,
output
PROCESS
Internalprocess – back office
operations (preprocessing,
processing, postprocessing)
employees or machines process
customers requests without
necessarily being seen by the
customer
PROCESS
External process – actual
servicing where customers
are part of the process
When used effectively, the 7Ps
of marketing will achieve the
two most important objectives
of an entrepreneur:
Customer delight and
profitability