Marketing Mix

The Original Marketing Mix

• Product
• Price
• Promotion
• Place

Defining the Product Component

• A product refers to the good or service that the customer buys
• Here, a product may be a tangible good or an intangible good (i.e. service, idea, experience)

• These typical marketing decisions include:

  • Product design
  • Product assortment
  • Returns
  • Branding
  • Packaging and labeling
  • Managing warranties
  • Managing products through their product life-cycle
• These typical marketing decisions are centered around how a customer perceives a product

Defining the Price Component

• A price refers to how much the customer spends on a product
• Here, a price may refer to the customer's sacrifice of their time and effort

• These typical marketing decisions include:

  • Price strategy
  • Price tactics
  • Price setting
  • Discounting
  • Defining payment methods
• These typical marketing decisions are centered around how a customer values a product

Defining the Promotion Component

• A promotion refers to how the customer is found and persuaded to buy
• Here, a promotion refers to the communication between the customer and the product

• These typical marketing decisions include:

  • Promotional mix (i.e. balancing advertising, PR, etc.)
  • Message strategy (i.e. what is communicated)
  • Channel strategy (i.e. how to reach target audience)
  • Message frequency (i.e. how often to communicate)
• These typical marketing decisions are centered around how a customer learns about a product

Defining the Place Component

• A place refers to how the product is distributed to the customer
• Here, a place refers to providing the customer access to the product

• These typical marketing decisions include:

  • Distribution strategy
  • Franchising
  • Market coverage
  • Assortment
  • Inventory
  • Transportation
• These typical marketing decisions are centered around how a customer accesses a product

Two Perspectives of Promotions

• Promotions involve finding the optimal match between consumers and offerings

• This includes two important problems:

  • Product discovery
  • Customer targeting

• The product discovery problem involves finding the right offerings for a given customer

  • This usually involves solving problems like product search and product recommendations
• The customer targeting problem involves finding the right customers for a given offering

References

• Textbook about Algorithmic Marketing
• Wiki about the Marketing Mix