Compilation of answers on the elements of marketing mix! Also read about: 1. Marketing Mix 4ps 2. 7 Elements Of Marketing Mix 3. Marketing Mix Elements With Examples 4. Marketing Mix Example 5. Importance Of Marketing Mix 6. What Is Marketing Mix

This article will help you to get the answers of:

  1. What are the 4 elements of marketing mix?
  2. What is 7ps marketing mix?
  3. What are the four basic marketing strategies?
  4. What are the elements of marketing mix?

Answer 1. Elements of Marketing Mix:

Traditionally, marketers have considered the marketing mix as a combination of four basic components, or elements, namely- product, place, price and promotion. However, many marketers have long regarded the ‘4Ps’ definition as too restrictive.

Criticism has centred on its short-term transaction focus and its failure to concentrate sufficiently on the importance of building and maintaining long-term relationships with customers. Many authors have now suggested a modification of the existing 4Ps framework in an effort to capture the broader complexity inherent in relationship marketing.


Considerable support has also been given to the 7Ps suggested by Booms and Bitner. They propose that the existing four elements of the marketing mix be extended to include three additional elements- physical evidence, people and processes. However, we would argue that ‘physical evidence’ should be replaced with ‘customer service’.

While this substitution results in one element not being a ‘P’, it can be argued that a preoccupation with finding elements beginning with the letter ‘F may be counterproductive. For those fixated with ‘Ps’, we would suggest ‘proactive customer service’.

Before moving on to a detailed discussion of the three additional marketing mix elements, it is worthwhile commenting briefly on why we feel they are particularly relevant.

I. Customer Service:


Customers are becoming more sophisticated and demanding better service from suppliers. There is also an increasing need to build closer and more enduring relationships with customers through the provision of better service. Further, businesses now use customer service as a competitive weapon to help them differentiate their product and service offerings from those of competitors.

II. People:

The importance of managing internal customers is being increasingly recognized that people are an essential element in both product and service offerings since they are responsible for developing and sustaining long-term relationships with customers and, as such, they are part of the differentiation of organizations which provides competitive advantage.

III. Processes:


Processes are the actual procedures, mechanisms, routines, and flow of activities by which the product and/or service is delivered to the customer. They can also involve policy decisions about customer involve­ment and employee discretion.

Processes are seen to be worthy of inclusion in the expanded marketing mix because, if the processes supporting the product and/or service delivered to the customer fail, no amount of relationship building will overcome continued unsatisfactory process performance.

These three marketing mix elements (customer service, people and processes), along with the traditional marketing mix elements of product, place, price and promotion, are generally considered to be sufficiently robust to cover most situations.

However, it is these three additional elements which are typically more concerned with keeping, rather than winning, customers and as such, they play a pivotal role in relationship marketing. Let us now examine these three key elements in more detail.

I. Customer Service:


Customer service has grown in importance in recent years for a number of reasons. First, more and more markets are becoming, in effect, ‘commodity’ markets, as the customer perceives little technical difference between competing offers. Thus the need to create differential advantage through added value has become paramount and customer service is a vital source of added value.

Second, customers are becoming increasingly sophisticated and demanding in their service requirements and expectations. Third, companies are beginning to realize that increases in customer satisfaction and customer retention can have a significant impact on company profitability and corporate success.

Despite the fact that customer service can provide companies with such obvious advantages, customer care activities generally do not match either customers’ expectations or organizations’ aspirations.

In many companies, customer care practices amount to reactive ‘firefighting’, as opposed to any proactive attempt to systematically improve customer satisfaction. Customer service is often seen as the handling of customer complaints, rather than the managing of customer relationships.


This, of course, assumes that customers complain in the first case. Studies have shown that 98 per cent of dis-satisfied customers never complain when they receive poor service, but, as a result, 90 per cent will not return to the disappointing supplier in future. Further, customers who are dissatisfied are likely to tell at least ten others about their poor service experience.

This is quite extraordinary when you think that satisfied customers will tell only three people about their good service experience. This means that many companies face an uphill battle in trying to achieve a reputation for good customer service. If they get their service wrong, everyone will know about it, but if they get their service right, only three people will hear the good news.

Therefore, the speed of response to customer complaints is a critical ingredient in managing customer satisfaction. If a complaint can be resolved quickly and effectively, then customers will generally be satisfied with the response given. Unfortunately, only 6 per cent of customers experience such an immediate response. Most customers have to wait for a response, which then drives up costs for the business.

II. People:

People are increasingly becoming part of the differentiation by which companies seek to create added value and to gain competitive advantage. Employees play a pivotal role in customer acquisition and retention, by ensuring customer satisfaction and by developing and sustaining long-term relationships with customers. It is surprising, therefore, that not more companies recognize the strategic importance of managing the people ‘P’ of the marketing mix.


The significant role played by people in the marketing of products and/or services has led to a greater interest in internal marketing. Internal marketing is essentially a way of enabling organizations to recruit, motivate and retain customer-conscious employees in order to boost employee retention and customer satisfaction levels.

Schneider and Bowen have found that when employees identify with the norms and values of an organization which reflect a commitment to customer service, they are less inclined to leave their jobs. This reduction in employee turnover serves to strengthen the organization and to promote the transmission of service values to successive generations of employees.

Furthermore, customers are more likely to be pleased with the service they receive from happy, experienced employees. Conversely, unhappy, poorly trained and inexperienced employees invariably lead to unhappy customers. Employee satisfaction in internal markets is, therefore, a prerequi­site to customer satisfaction in external markets.

There are two basic rules to successful internal marketing:


1. Staff must work together across functional boundaries to ensure that the company’s mission, strategy and objectives are served in both policy and practice. Cross-functional collaboration is particularly crucial in companies that operate high levels of direct interaction with customers.

2. Every employee fulfills the dual role of internal supplier and internal customer. To support and promote external customer satisfaction, every individual and department within the organization must provide fellow employees and departments with excellent internal customer service.

Differing Roles of People:

This second aspect of internal marketing, the idea of the internal customer, is the primary focus of the people ‘P’ for the purposes of this article. When viewing people as an element of the marketing mix, it is essential to recognize the different ways in which employees influence the marketing task and the customer relationship.

Judd has developed a categorization scheme based on the degree of frequency of customer contact and the extent to which staff are involved with conventional marketing activities.

The different roles fulfilled by employees are classified as set out below:


1. Contactors:

Employees who have direct, frequent or periodic customer contact. They are typically involved with conventional marketing activities, (for example, customer service and selling). They are also responsible for building relationships with customers and, as such, they need to be trained, prepared and motivated to serve the customer well.

Recruitment and selection processes should consider the person’s potential to be responsive to customer needs, and appointees should be evaluated and rewarded on this basis.

2. Modifiers:

Employees who have less direct, frequent or periodic customer contact. Their responsibilities usually do not entail face-to-face interaction with customers. Modifiers include people such as receptionists, credit department representatives and switchboard operators who are not involved with conventional marketing activities. Like Contactors, Modifiers also require excellent customer relationship skills. Here, training provision and performance monitoring are crucial.

3. Influencers:


Employees who typically have no direct contact with customers, although they may take decisions that relate to customers as they are often involved with the traditional elements of the marketing mix. Influencers include people responsible for product development, market research, and so forth.

The recruitment of influencers should favour those with the potential to develop a sense of customer responsiveness. Influencers should be evaluated and rewarded according to customer- oriented performance standards.

4. Isolateds:

Employees who have no customer contact. These people perform various support functions and do not have a great deal to do with conventional marketing activities. However, as support providers, their activities critically affect organizational performance. Isolateds include staff in the purchasing, personnel and data processing departments. They should be sensitive to the needs of internal and external customers.

This categorization suggests that people form an important part of differentiation, contributing to the creation of added value for the external customer. By viewing people as a separate element in the marketing mix, appropriate attention can be directed towards maximizing the impact of their activities through the provision of suitable and sufficient levels of support, incentive, and reward.

While Contactors are not the only people involved in service delivery, their ability to function effectively depends to a great extent on the support they get from other employees within the organization.


Frequently, there are large numbers of support personnel who do not come into direct contact with the customer, but who nevertheless have a very important role to perform and who directly influence the service that is ultimately provided to the customer.

They are often referred to as ‘part-time marketers’. Systematic internal marketing, therefore, is a mechanism for developing and maintaining these part-time marketers as service-minded and customer-conscious employees.

Through internal marketing, all employees can begin to understand how their tasks and the way in which they are performed affect customer satisfaction and contribute to a true marketing orientation.

Unfortunately, in many organizations, rules, regulations, practices and procedures are communicated from the CEO down through the organization to the front-line staff in an instructive manner- ‘this is what you will do’.

These front-line staff, or Contactors, usually has the first and most frequent contact with customers, but are often the lowest paid and least respected people in the organization. They include cashiers, van drivers and salespeople.

An alternative operational approach aimed at ensuring an internal marketing orientation is to turn the organizational pyramid upside-down, conceptually at least. Members of the front-line staff then become the most important people in the organization.


They should be treated like internal customers, and more senior personnel should ask them instead, ‘What can I do to help you do your job better?’ When this change in attitude is adopted throughout the organization, employees will begin to regard themselves as internal suppliers and internal customers.

Consequently, internal staff will be encouraged to recognize that if they are not serving the customer directly, they are probably serving someone who is, and therefore their contribution to enhancing the quality of internal service impacts the quality of service provided externally.

Internal marketing, therefore, is essentially concerned with creating, developing and maintaining an internal service culture and orientation that assists and supports the organization in achieving its goals. The fundamental aims of internal marketing are to develop internal and external customer awareness and to remove functional barriers to organizational effectiveness.

The idea is to ensure that all members of staff provide the best possible contribution to the marketing activities of the company and that all customer interactions are conducted in a way that adds value to the service encounter.

Developing Internal Marketing Relationships:

An increasing number of companies have recognized the need for internal marketing programmes and the implementation of such programmes has gained momentum in recent years. Perhaps the most famous examples of this are Scandinavian Airline System (SAS) and British Airways.


In fact, some organizations have started to view internal marketing as a strategic weapon employed as a means of retaining customers through the achievement of high- quality service delivery and increased customer satisfaction. Yet, despite this, there is still no consensus on the implementation of internal marketing.

What is clear is that internal marketing should not be solely the domain of marketers merely applying the same old traditional marketing concepts and tools. To do this would destroy the very nature of what is meant by relationship marketing and would not take into account the special needs of the internal market.

The model that would seem to offer the most in terms of enhancing the organization’s capabilities is that proposed by Varey. This model of internal marketing acts as a process or mechanism for integrated market-oriented management.

More work, however, needs to be undertaken to test this model empirically with organizations and to determine what it takes in operational terms to ensure internal marketing success. In the meantime, however, there is some agreement as to the range of interrelated internal marketing activities that are thought to be critical in helping to implement internal marketing.

1. Organizational design must be conducive to developing an internal market­ing orientation. Market-facing, multi-disciplinary teams which are able to marshal resources to achieve market-based objectives are ideal for achieving an internal marketing philosophy.

2. Staff surveys are required on a regular basis to assess the internal service climate and culture to ensure internal and external service quality.

3. Internal customer segmentation by, for example, level of customer contact, is necessary to target specific service provision and training to ensure service quality.

4. Personal development and training should be focused on core competencies for internal marketing. Research can help determine the internal and external customer requirements that will shape the nature of personal training and development.

5. Empowerment and involvement enable staff within clearly defined parameters to use their discretion to deliver a better quality of service to their customers.

6. Recognition and rewards based on employees’ contributions to service excellence are critical to determining employee behaviour and should be based on careful consideration of their likely impact on behaviour, as well as their attractiveness or motivational factor for the individual.

7. Internal communications provides a mechanism for cross-functional partici­pation in the coordination of activities within the organization. It helps to reinforce service quality and ensures that everyone knows what to do and the context of their role in the wider activity.

Business television is now used in many organizations to facilitate communications, particularly in organizations that have branch networks. This medium ensures that all the employees receive news and information at the same time, and facilitates a greater organizational cohesion across the company.

8. Performance measures need to be visible and should measure each person’s and department’s contribution to the achievement of performance objectives for each key success factor.

9. Building supportive working relationships for employees should be a key issue when developing an internal marketing approach. Employees should be able to provide each other with consideration, trust, warmth and support, all of which help to break down barriers within and between departments. This enhances internal communications and the likelihood of achieving internal and external service quality.

The effective management of employees has become an increasingly powerful weapon in an increasingly competitive environment. However, while the people ‘p’ is a critical element of the relationship marketing mix, no amount of attention and effort from staff will overcome continued unsatisfactory process performance.

If the processes supporting product or service delivery cannot, for example, provide an acceptable meal or repair a faulty machine within a defined period of time, an unhappy customer will be the result.

III. Processes:

The processes by which products and services are created and delivered to the customer are a major factor within the relationship marketing mix, as many customers will often perceive the service delivery system as part of the product or service offering. All work activity represents a process.

Processes encompass the procedures, tasks, schedules, mechanisms, activities, and routines by which a product or service is delivered to the customer. They involve policy decisions about customer involvement and employee discretion. To reiterate, unsatisfac­tory process performance can diminish or destroy the strength of a customer relationship.

This fact suggests that effective operations management is crucial to the success of marketing products and services, and that the close and continuous cooperation of marketing and operations functions is essential to business prosperity.

Processes as Structural Elements:

Lyn Shostack has suggested that the structural nature of processes means that they can be engineered to help deliver a desired strategic positioning.

She argues that a process-oriented approach involves:

1. Breaking down the process into logical steps and sequences to facilitate control and analysis.

2. Taking into account the more variable processes, this may lead to different outcomes because of judgment, choice or chance.

3. Deviation or tolerance standards which recognize that processes are real time phenomena which do not perform with perfect precision, but function within a performance band.

Services processes can also be analysed according to their complexity and divergence. Complexity is concerned with the nature of the steps and sequences that constitute the process.

Divergence refers to the ‘executional’ latitude, or the variability of the steps and sequences- for example, a surgeon’s work is likely to be high in both complexity and divergence, whereas the services offered by the keeper of corner shop may be low in complexity and divergence. Further, the services provided by an hotelier may be low in divergence, but high in complexity.

Processes can often be depicted as detailed maps, flow charts or blueprints. Such diagrammatic representations reduce processes to a series of interrelated steps and sequences. This approach requires the portrayal of all the points of contact between the customer and the supplier.

Possible weaknesses in the service encounter can then be identified and redressed, thereby improving service quality. When presented with a process blueprint, managers are often surprised at the complexity of the processes involved in the operation. Indeed, a major benefit of mapping processes is that resources can then be appropriately allocated towards the re-engineering of processes to simplify and streamline business activities.

Processes can be changed in terms of complexity and divergence to reinforce their strategic positioning or to establish a new positioning.

The four options outlined by Shostack are as set out below:

1. Reduced Divergence:

This tends to reduce costs, improve productivity and make distribution easier. It can also produce more uniform service quality and improved service availability. However, its negative effects may include a perception of limited choice and a rejection of highly standardized service.

2. Increased Divergence:

This involves greater customization and flexibility which may command higher prices. This approach suggests a niche positioning strategy based less on volume and more on margins, enabling a more tailored relationship-building approach to be achieved.

3. Reduced Complexity:

This usually means a specialization strategy. Steps and activities are consciously omitted from the service process and this simplification tends to make distribution and control easier.

4. Increased Complexity:

This is usually a strategy to increase market penetration through the addition of further services. Supermarkets, banks and building societies are increasingly following this approach by providing a greater number and range of service offerings to their customers.

Each of these process management options has advantages and disadvan­tages, but they all provide opportunities to alter customers’ perceptions and market positioning. These process characteristics constitute criteria by which customers can judge the quality of services.

For example, Southwest Airlines in the USA and Singapore Airlines are both successful companies, but they follow very different process models. Singapore Airlines focuses on providing a customized service that is designed to meet the individual needs of the business traveller. As such, employees of Singapore Airlines are empowered to provide non-standardized services and to exceed performance expectations to satisfy customer requirements.

In contrast, Southwest Airlines is a no-frills, low-priced carrier that offers frequent and relatively short-haul domestic flights in the USA. Its service does not offer in-flight catering or pre-assigned seating. The airline has adopted a totally standardized approach to service, although the fun in-flight atmosphere that is generated by the unique company culture compensates for the reduced divergence.

Processes have characteristics that can be deliberately and strategically managed within the context of the relationship-oriented marketing mix with the purpose of reinforcing or changing market positioning.

Therefore, an organization needs to have a clear understanding of these process character­istics in order to maintain a competitive position in the market place and to determine the appropriate RM approach for its target market.

Answer 2. 7 Elements of Marketing Mix:

(i) Product:

A product is any goods or services that consumers want. It is a bundle of utilities or a cluster of tangible or intangible attributes. It requires decisions w.r.t., the size and weight of product, quality of product, design, volume, brand name, packaging, range, testing, warranties and after sales-service etc.

(ii) Price:

Price has a direct influence on sales volume and profits of business. Demand, cost, competition, government regulation etc. are the vital factors that must be taken into consideration. It requires decisions to be taken regarding basic price, discounts, price alterations, credit terms, freight payment etc.

(iii) Promotion:

It is concerned with the bringing of products to the knowledge of customers and persuading them to buy these. It involves decisions relating to advertising, sales force, direct marketing, public relationships, advertising budget etc.

(iv) Place/Distribution:

It involves the choice of place where products are to be made available for sale. The objective of selecting and managing trade channels is to make available the products to the customers at the right time and place on a continuous basis. It is also concerned with the decisions relating to the wholesale and retail outlets of distribution.

The 4Ps are standard components of marketing mix in case of products but in case of services (intangible in nature) this marketing mix is not sufficient. We need to expand the 4Ps of marketing by adding people, physical evidence and process into the picture.

(v) People:

While servicing there is a direct interaction of service providers and consumers, hence, subjectivity will be there. The decisions that the marketer can take care of are: appearance, service, training, discretion, commitment, behaviour, consumer interaction and attitude of the service provider.

(vi) Physical Evidence:

It is one of the most important factors of marketing mix. Decisions like ambience, furnishings, atmosphere and layout of the work place are very important.

(vii) Process:

With services being non-homogeneous in nature it is necessary to have standardized procedures to be adopted for delivering the service. Herein, the decisions like policies, procedures, system and customer involvement are to be taken care of.

Answer 3. Elements/Ingredients of Marketing Mix:

1. Product:

Product is the article which a manufacturer desires to sell in the open market. It is the first element in the marketing mix.

The product mix includes the following variables:

i. Product line and range,

ii. Style, shape, design, colour, quality and other physical features of a product,

iii. Packaging and labeling of a product,

iv. Branding and trade mark given to the product,

v. Product innovation, and

vi. Product servicing

Managing product component involves product planning and development. Here, the decisions are required to be taken regarding product range, branding, packaging, labeling and other features of the product. The product manufactured for market should be as per the needs and expectations of consumers.

Product is the most powerful competing instrument in the hands of the marketing manager. It is the heart of whole marketing mix. If the product is not sound/attractive to the customers, no amount of sales promotion, appropriate channel selection or price reduction will help to achieve the marketing target. Hence, durability, quality, uses, etc. of the product are important from the marketing point of view.

Various Aspects of Product Decisions in Marketing:

In the marketing process, various decisions regarding the product are required to be taken. Marketing will be easy and quick if the decisions taken on various aspects of a product are appropriate. Such decisions need to be taken by the marketing division of the Organisation.

These decisions should be based on current marketing environment, nature of market competition, consumer expectations, information available through marketing research and so on. Cooperation of other departments is also necessary in marketing decision-making.

Production or product is rightly treated as the heart of the marketing mix. Customers purchase a product because of its attributes, features and benefits. These are the selling points of a product.

They should be adjusted to the buying motives of consumers. A consumer/customer considers the total package of benefits available from the product and takes a decision to purchase the product.

This suggests that various decisions regarding the product to be marketed need to be taken correctly. As a result, the product offered in the market will be a quality product. In addition, it will be utility oriented, attractive, convenient, property designed and branded. Even attractive packaging decision facilitates sales promotion.

The following aspects of a product need careful attention in marketing decision-making:

i. Product line and range

ii. Style, shape, design, colour, quality and other physical features of a product

iii. Packaging and labeling of a product

iv. Branding and trade mark given to a product

v. Product servicing and channel of distribution

vi. Product pricing

vii. Guarantees and warranties of the product

viii. Product innovation

ix. Special features of the product from the marketing point of view

Decisions on these aspects of a product are important as marketing is directly related to these aspects. Sales promotion measures will be useful but their role will be supplementary/supportive.

Such measures may not be effective if the product to be marketed is not of standard quality or if the brand or package is not attractive or if the product is not as per the requirements/expectations of consumers. This suggests that decisions relating to product are important/crucial in the marketing of a product.

2. Price:

Price is one more critical component of marketing mix. It is the valuation of the product mentioned by the seller on the product.

Price mix includes the following variables:

i. Pricing policies,

ii. Discounts and other concessions offered for capturing market,

iii. Terms of credit sale,

iv. Terms of delivery, and

v. Pricing strategy selected and used.

Pricing has an important bearing on the competitive position of a product. The marketing manager may use pricing as a tool for achieving the targeted market share or sales volume. Pricing can also be used for capturing market and also for facing market competition effectively. Pricing decisions and policies have direct influence on the sales volume and profits of the firm.

Market price of a product also needs periodical review and adjustments. The price charged should be high enough to give adequate profit to the company but low enough to motivate consumers to purchase product. It should also be suitable to face market competition effectively.

3. Place (Distribution Channel):

Physical distribution is the delivery of goods at the right time and at the right place to consumers. Physical distribution of product is possible through channels of distribution which are many and varied in character.

Physical distribution (place mix) includes the following variables:

i. Types of intermediaries available for distribution,

ii. Distribution marketing channels available for distribution, and

iii. Transportation, warehousing and inventory control for making the product available to consumers easily and economically.

For large-scale distribution, the services of wholesalers, retailers and other marketing intermediaries are required. A marketing manager has to select a channel which is convenient, economical and suitable for the distribution of a specific product.

For instance, large numbers of outlets are required for the distribution of products of mass consumption such as soaps and oils. On the other hand, for the marketing of speciality products like refrigerators and TV sets, selective distribution through authorized dealers is quite convenient.

4. Promotion:

Promotion is one element of Marketing Mix. Promotion is the persuasive communication about the product offered by the manufacturer to the prospect. Promotional activities include Advertising (by using different media), sales promotion (sales and trades promotion), and personal selling activities.

It also includes internet marketing, sponsorship marketing, direct marketing, database marketing, and public relations and integration of all these promotional tools along with other components of marketing mix to gain edge over competitor is called promotion mix.

Elements of Promotion Mix:

Marketers have at their disposal the major methods of promotion i.e. advertising, sales promotion, publicity, pubic relation, personal selling and word of mouth. Taken together these comprise the promotion mix. But in the present scenario, the promotional tools have widened their scope and number of types.

There are many other promotional tools also which are considered under the promotion mix such as e- commerce/internet marketing, sponsorship, exhibitions, packaging, point-of-purchase displays, corporate communications/identity, event marketing, trade shows, and customer service.

The major elements of promotion mix/communication mix are as follows:

1. Advertising – Advertising includes any informative or persuasive message carried by a non-personal medium and paid for by a sponsor whose product is in some way identified in the message. Traditional mass media, such as television and magazines, are most commonly used.

However, the direct mailing of catalogues, electronic media advertisements featuring computerized ordering, and other direct-response vehicles are becoming increasingly popular.

2. Sales Promotion – It includes activities other than advertising, personal selling publicity and public relations which are used in promoting sales of the product or in persuading the customer to purchase the product.

3. Personal Selling – Personal selling is a person-to-person dialogue between buyer and seller. The purpose of the interaction, whether face-to-face or over the phone, is to persuade the buyer to accept a point of view, to convince the buyer to take a specific course of action, or to develop a customer relationship.

4. Publicity – Publicity is a non-personal not paid stimulation of demand of the products or services or business units by planting commercially significant news or editorial comment in the print media or by obtaining a favorable presentation of it upon radio, television or stage.

5. Public Relations – Most firms in today’s environment are not only concerned to customers, suppliers and dealers but also concerned about the effect of their actions on people outside their target markets. It is a planned effort by an organization to influence the attitudes and opinions of a specific group by developing a long term relationship.

6. Propaganda – Propaganda is a form of communication that is aimed at influencing the attitude of a community toward some cause or position.

7. Direct Marketing – In Direct Marketing, organizations communicate directly with target customers to generate a response and/or a transaction. Traditionally, direct marketing has not been considered an element of the promotional mix.

8. Word-of-Mouth – An organization’s image can be projected through channels other than the formal communication process. Of course, positive word-of-mouth recommendation is generally dependent on customers having good experiences with an organization, and studies have shown how unexpectedly high standards of service from a company can promote recommendation.

Answer 4. Elements of Marketing Mix:

The extended marketing mix has the following elements:

(i) Product Decisions:

The term “product” refers to tangible, physical products as well as services. Here are some examples of the product decisions to be made —Brand name, Functionality, Styling, Quality, Safety, Packaging, Accessories, Warranty, Repairs and Support, etc.

(ii) Price Decisions:

Some examples of pricing decisions to be made include Pricing strategy (Skimming price, Penetration price), Suggested retail price, Volume discounts and wholesale pricing, Cash and early payment discounts, Seasonal pricing, Bundling, Price flexibility, Price discrimination.

(iii) Distribution (Place) Decisions:

Distribution is about getting the products to the customer. Some examples of distribution decisions include Distribution channels, Market coverage (inclusive, selective, or exclusive distribution), Specific channel members, Inventory management, Warehousing, Number and Location of Distribution centers, Order processing, Mode of Transportation, Reverse logistics, etc.

(iv) Promotion Decisions:

In the context of the marketing mix, promotion represents the various aspects of marketing communication, that is, the communication of information about the product with the goal of generating a positive customer response.

Marketing communication decisions include Promotional strategy (Push, Pull, etc.), Advertising, Personal selling and sales force, Sales promotions, Public relations and publicity, Marketing communications budget, etc.

The marketing mix framework was particularly useful in the early days of the marketing concept when physical products represented a larger portion of the economy. Now Marketing is more integrated into organisations and with a wider variety of products and markets. Some authors have attempted to extend its usefulness by proposing an extended marketing mix that consists concepts such as physical evidence, people, process, etc.

(v) People:

The people that are directly or indirectly involved in the con­sumption of a service are an important part of the Extended Marketing Mix. Knowledge workers, employees, management and consumers often add significant value to the total product or service offering.

(vi) Process:

Procedure, mechanisms and flow of activities by which services are consumed (customer management processes) are an essential element of the marketing strategy.

(vii) Physical Evidence:

It is the ability and environment in which the service is delivered. It includes both tangible goods that help to communicate and perform the service, and the intangible experience of existing customers and the ability of the business to relay that customer satisfaction to potential customers.

Answer 5. Elements of Marketing Mix:

One of the major goals of any organisation is to become a market leader. To achieve this, it has to come out with an enticing market offer. The market offer—also known as the marketing mix—consists of a right product, being priced and delivered to customers in an appropriate manner. The market offer is nothing but a bundle of benefits and services offered to potential customer in the best possible manner.

The four essential elements of the marketing mix— according to Jerome McCarthy—namely, the product, price, promotion and physical distribution (also known as 4Ps of marketing mix) must be combined effectively in order to achieve both competitive advantages in the market place and company objectives.

I. Elements of Mix are Inter-Related:

The term marketing mix refers to the set of marketing ingredients that a company uses to achieve its goals. Just as a baker selects ingredients from large variety and combines them in different amounts to bake cake, marketers pick up and choose from an extensive set of marketing components in order to find the right recipe to provide satisfaction to the consumers. The various elements of marketing mix are closely interrelated and support one another. Any change in one of the elements of mix would require adjustments in other elements almost immediately.

II. Elements of Mix must give a Competitive Edge:

They must be combined effectively in order to gain a competitive edge in the target market the market segment that the company chooses to serve depending on the resources and capabilities of a firm offering value to customers.

III. Choose the Segments that can be Served Profitably:

The firm must choose profitable segments in the market place carefully. (For example, whether the car manufacturer, for example, wants to be in the low price segment like Maruti’s Alto or the high price segment, the BMW or wants to take a middle path Ford Ikon) Obviously it cannot come out with an offer that meets the requirements of all segments. Keeping its own resources and capabilities in mind, a firm has to design an appropriate mix. The chosen offer must help the firm get past competition comfortably. It should be able to serve each of the chosen segments profitably.

IV. Mix must be Distinct and Enticing Enough:

If the marketer is able to come out with a distinct offer that is different from that of rivals’—in terms of product quality, features, design, price, etc.—it becomes relatively easy to win the race.

V. Positioning Helps a Firm to Win a Distinct Place in the Minds of Customers in Target Market:

Positioning is the process of creating a distinct offer and communicating it to the customer. It is the act of communicating a company’s offer so that it occupies a distinct and valued place in the customer’s mind, (for example having a tooth paste with clove oil, salt, or medicinal properties, or simply a vegetarian toothpaste etc.) Positioning is created by designing a marketing mix which is suitable in the target market but is different from marketing mixes of rival firms.

V. Marketing, all said and done, is a value game and marketing mix is the tool for playing the game. Every firm should try to pack value in each element of the mix. Every attempt must be made to give the customers the value they want and in the way they want it via the marketing mix.

VII. Delivering Value through Clever Use of Mix is the Name of the Game:

Since value can be enhanced by adjusting any element of the marketing mix, the marketer plays the value game by juggling the mix. He can enhance the value by improving the product, reducing the price, emphasizing new benefits and uses of the product (e.g. tea being positioned as a health drink).

VIII. Flexible and Dynamic Concept:

Marketing mix is not a rigid combination of four variables. It is in fact a flexible combination of variables. In sync with a changing market scenario, the various ingredients of mix need to be changed.

IX. Customer is the Fulcrum around which Marketing Activity Revolves:

The main focus of marketing mix is the customer. Marketing mix is a consumer-oriented activity as its purpose is to give satisfaction and pleasure to consumers. Here, the needs and expectations of consumers require special attention and adjustment in the 4 Ps from time to time.

X. Four Ps of Sellers Correspond to Four Cs of Customers:

Four Ps in the marketing mix represent the sellers’ view of the marketing tools availa­ble for influencing buyers. Each tool is designed to deliver a customer benefit.

1. Product:

Product is the article which a manufacturer desires to sell in the open market. It is the first element in the marketing mix. The product mix includes the fol­lowing variables. Managing product component involves product planning and development. Here, the decisions are required to be taken regarding product range, branding, packaging, labeling and other features of the product.

The product manufactured for market should be as per the needs and expecta­tions of consumers. Product is the most powerful competing instrument in the hands of the marketing manager. It is the heart of whole marketing mix. If the product is not sound/attractive to the customers, no amount of sales promotion, appropriate channel selection or price reduction will help to achieve the marketing target. Hence, durability, quality, uses, etc., of the product are important from the marketing point of view.

i. Product line and range,

ii. Style, shape, design, colour, quality and other physical features of a product,

iii. Packaging and labeling of a product,

iv. Branding and trade mark given to the product

v. Guarantees and warranties of the product,

vi. Product innovation, and

vii. Product servicing.

Decisions on these aspects of a product are important as marketing is directly related to these aspects. Sales promotion measures will be useful but their role will be supplementary/supportive. Such measures may not be effective if the product to be marketed is not of standard quality or if the brand or package is not attractive or if the product is not as per the requirements/expectations of consumers. This suggests that decisions relating to product are important/ crucial in the marketing of a product.

2. Price:

Price is the amount of money costumers pay to obtain the product or use the service. Price determination is the difficult task and critical factor for mar­keters. The revenue is determined by analyzing revenue and cost properly. Marketing managers must fix the price in such a way that products can be sold successfully.

Then price mix includes setting price level, determining the level of discounts and allowances, establishing credit policies, terms and conditions and developing pricing strategies. Price has a direct impact on the sales volume and revenue of the company and therefore, it is one of the most critical elements in the marketing mix.

i. What is the value of the product or service to the buyer?

ii. Are there established price points for products or services in this area?

iii. Is the customer price sensitive? Will a small decrease in price gain you extra market share? Or will a small increase be indiscernible, and so gain you extra profit margin?

iv. What discounts should be offered to trade customers, or to other specific segments of your market?

v. How will your price compare with your competitors?

Pricing is one of the most important elements of the marketing mix, as it is the only mix, which generates a turnover for the organisation. The remaining 3p’s are the variable cost for the organisation. It costs to produce and design a product, it costs to distribute a product and costs to promote it. Price must support these elements of the mix. Pricing is difficult and must reflect supply and demand relationship. Pricing a product too high or too low could mean a loss of sales for the organisation.

Pricing should take into account the following factors:

(i) Fixed and variable costs

(ii) Competition

(iii) Company objective

(iv) Proposed positioning strategies and target group and willingness to pay.

An organisation can adopt a number of pricing strategies. The pricing strate­gies are based much on what objectives the company has set itself to achieve.

Four Pricing Strategies:

i. Premium Pricing:

Use a high price where there is a uniqueness about the prod­uct or service. This approach is used where a substantial competitive advantage exists. Such high prices are charged for luxuries such as Cunard Cruises, Savoy Hotel rooms, and Concorde flights.

ii. Penetration Pricing:

The price charged for products and services is set artificially low in order to gain market share. Once this is achieved, the price is increased. This approach was used by France Telecom and Sky TV.

iii. Economy Pricing:

This is a no frills low price. The cost of marketing and manu­facture are kept at a minimum. Supermarkets often have economy brands for soups, spaghetti, etc.

iv. Price Skimming:

Charge a high price because you have a substantial competi­tive advantage. However, the advantage is not sustainable. The high price tends to attract new competitors into the market, and the price inevitably falls due to increased supply. Manufacturers of digital watches used a skimming approach in the 1970s. Once other manufacturers were tempted into the market and the watches were produced at a lower unit cost, other marketing strategies and pricing approaches are implemented.

3. Promotion:

Promotion means informing the customers about the product and persuading them to buy. Products have to be advertised through different media, customers have to be contacted, products need to be displayed and the use demonstrated. The promotion mix involves decisions on advertising, amount of money to be spent in different advertising media used, sales promotion, publicity, personal selling and public relation.

Four Elements of Promotion Mix:

a. Advertising:

Any paid form of non-personal communication of ideas or products in the “prime media”: Le. Television, newspapers, magazines, billboard posters, radio, cinema etc. Advertising is intended to persuade and to inform. The two basic aspects of advertising are the message (what you want your communication to say) and the medium (how you get your message across)

b. Personal Selling:

Oral communication with potential buyers of a product with the intention of making a sale. The personal selling may focus initially on developing a relationship with the potential buyer, but will always ultimately end with an attempt to “close the sale”.

c. Sales Promotion:

Providing incentives to customers or to the distribution channel to stimulate demand for a product.

d. Publicity:

The communication of a product, brand or business by placing information about it in the media without paying for the time or media space directly, otherwise known as “public relations” or PR.

Some of the important issues that need close attention would include:

1. Where and when can you get across your marketing messages to your target market?

2. Will you reach your audience by advertising in the press, or on TV, or radio, or on billboards? By using direct marketing mailshot? Through PR? On the Internet?

3. When is the best time to promote? Is there seasonality in the market? Are there any wider environmental issues that suggest or dictate the timing of your market launch, or the timing of subsequent promotions?

4. How do your competitors do their promotions? And how does that influence your choice of promotional activity?

4. Place (Physical Distribution):

The physical distribution mix has two major aspects:

Physical distribution and distribution channel selection. The producers are located in a few places and consumers are scattered throughout the globe. Products produced by the companies will have to be taken to the market and made readily and easily available to the consumers.

Physical distribution requires selection of appro­priate distribution channel and market outlets, selection of wholesalers and retailers. Physical distribution includes channels of distribution, market outlets, inventory levels, delivery and product handling.

Physical distribution (place mix) includes the following variables:

a. Types of intermediaries available for distribution,

b. Distribution marketing channels available for distribution, and

c. Transportation, warehousing and inventory control for making the product available to consumers easily and economically.

For large-scale distribution, the services of wholesalers, retailers and other marketing intermediaries are required. A marketing manager has to select a channel which is convenient, economical and suitable for the distribution of a specific product.

For instance, large numbers of outlets are required for the distribution of products of mass consumption such as soaps and oils. On the other hand, for the marketing of specialty products like refrigerators and TV sets, selective distribution through authorized dealers is quite convenient.

Three Commonly Followed Distribution Strategies:

Depending on the type of product being distributed there are three common distri­bution strategies available:

i. Intensive Distribution:

Used commonly to distribute low priced or impulse pur­chase products e.g. chocolates, soft drinks.

ii. Exclusive Distribution:

Involves limiting distribution to a single outlet. The product is usually highly priced, and requires the intermediary to place much detail in its sell. An example of would be the sale of vehicles through exclusive dealers.

iii. Selective Distribution:

A small number of retail outlets are chosen to distribute the product. Selective distribution is common with products such as computers, televisions household appliances, where consumers are willing to shop around and where manufacturers want a large geographical spread.

Answer 6. Elements of Marketing Mix:

There are four elements or 4Ps of marketing mix which attempt to attain business’ marketing goals and objectives. These elements are interrelated to each other because the decisions taken in one area affects the other.

The broad explana­tion to 4Ps is given below:

1. Product Mix:

The product in a product mix can include a product, service or idea consisting of tangible and intangible elements. Tangible products are those products which can be touched, felt, tasted or smelled while intangible include the psychological factors like image, satisfaction, utility, etc., about the product or its price.

Accordingly, product mix is a range of associated products and services available as per customer needs. It includes relevant design, quality, features, models, style, appearance, size, weight and volume, packaging-type, materials, label, testing of product, warranties/guarantees, brand name, trademarks and after-sale service.

For example- Titan Industries of the Tata group, manufactures, distributes and targets their watches under different brand names that cater different needs of their customers. Their ‘Sonata’ brand addresses the urban and rural economy segment of customers while ‘Fastrack’ brand focuses on the Indian youth. ‘Titan’ is designed for their customers in the mid-premium and “Xylys” is targeted towards customers of high-income groups who are connoisseurs or new-age achievers.

Main Components of Product Mix:

(i) Branding:

Branding process attempts to complement marketing activities by creating an identification of a product for customers, which makes them purchase the product regularly and loyally. It manifests the characteristics, attributes, and values of the business on the product through which customers can recognise the name, use and reasons for being interested about the product.

(ii) Packaging:

Products are required to be packaged in a material that protects the products from being damaged when distributed uncovered and unprotected. Packaging can be defined as all the activities of designing and producing the container or covering or wrapper for a product. The package is the actual container, covering or wrap­per made of metal, wood, paper, plastic, etc., that prepares any product for transport, storage, display and usage.

Levels of Packaging

Packages may include up to three levels of material:

a. Primary Packaging

b. Secondary Packaging and;

c. Shipping Packaging.

a. Primary packaging:

Primary packaging holds a single retail unit of a product. It encloses an actual commodity that protects and promotes products to get attention of consumers. It can include brand name, instructions, warnings, etc. on how to assemble or use the product. Such package remains attached or directly over the product with labels until the customer has completely used it. For example, the primary packaging of toothpaste is the toothpaste tube which has a cap that encloses the tube.

b. Secondary packaging:

Secondary packaging holds a single wholesale unit of a product. It is a layer of package added over the primary packaging. After purchase of a product the secondary package is initially removed and disposed off immediately followed by usage of primary package or taken off. For example, the toothpaste tube during purchase comes inside a rectangular cardboard packet which is the secondary package that comes off during consumption.

c. Shipping packaging:

Shipping package is used to facilitate identification, transportation, handling and storage of the products. Shipping is important and necessary because all goods should be stored for easy access and/or availability available across various geographical locations. Shipping packages are considered for products with primary and secondary packages to be distributed in bulk. Packages can include cardboard boxes, plastic boxes, wooden crates and boxes and so on.

(iii) Labelling:

Labelling is a part of the product mix component in marketing that follows after branding and packaging and is an equivalently important marketing function along with branding and packaging. It is a particular function within the packaging field which represents the outermost layer (or the brand) of the product. Labelling involves designing and preparing labels on this outermost part of the product package.

Labels display information and/or characteristics about the product. For example, packet of tablets contains the brand name, the weight and composition of the tablet, directions on the level of consumption and the instructions on storage methods. These specific instructions are accordingly important aspects of labelling that can possibly build up the brand and (representative) company image.

Functions of Labelling:

1. Labelling identifies the product – A label helps popularise the product and its brand name by specifying it in a unique design and style.

2. Labelling grades the product – A label grades the product that reflects the quality of the product in terms of its performance or utility.

3. Labelling describes the product – Label describes the product by introducing the name/brand, composition/ingredients, features, usage approaches, manufactured/ registered date, expiry date, warnings, safety measures, instructions on ways to use the product, and so on.

4. Labelling promotes the product – Labelling facilitates promotion of the product through the description mentioned on labels to attract and build curiosity among customers. It provides a basis for comparison and facilitates decision-making for customers.

5. Labelling protects the customers – By providing relevant information labelling attempts to protect customers by enabling them to make appropriate decisions and choices. Labelling also protects customers from possible malpractices like duplicity, adulteration and adverse effects on life and property.

6. Providing information required by law/legal requirement – As per regulations labelling should include relevant information that enables customers to make informed decisions about their purchases. For example, indication of vegetarian and non-vege­tarian food on processed food packets.

2. Price Mix:

Price is associated with its acceptability among customers for purchasing a product that reflects its utility, quality or value among them. The right price should be able to maintain demand in order to make more profits.

The price mix should be able to reflect the value and utility of the product, which in turn can become an effective marketing tool. The product should be reasonable priced and should account for costs, profit margin, possibilities of sale at different prices, government regulations (if any) and competition. Strategic decisions will also be required for credit terms, payment terms, discounts, installments, commissions, cost/ benefit, etc.

For example- Cadbury introduced Oreo biscuits in 2011 at f 10 per pack targeted towards most Indian households who could afford to spend on their biscuits. They gradually increased the prices to Rs. 12 as per consumer response the same year.

3. Place Mix:

Place refers to a channel or a route through which products / services move from businesses to end-customers. Place, also known as a means of distribution and activities undertaken by businesses for ensuring that the products are easily available or accessible to their respective customers. This mix involves decisions on selecting suitable distribution channels, storage facilities, location for sale, inventory levels, means of transportation, warehousing and so on.

For example- the Bhuleshwar market in the southern part of Mumbai is surrounded by a number of specialised wholesale markets in narrow lanes for cloth (Mangaldas Market), stationery items (Abdul Rahman Street), jewellery (Zaveri Bazaar), antiques and furniture (Chor Bazaar), food, vegetables and fruits (Crawford Market) and so on (Mehta, 2009). Good-quality products are available at wholesale and affordable prices for students, self-employed, housewives, businesses, high-income consumers, etc.

The Bhuleshwar market example is however an example for identifying a strategic location of sale which is a significant part of place mix. Corres­pondingly, place mix is broadly associated with decisions on determining channels of distribution and physical distribution.

(i) Channels of Distribution:

The channels of distribution are determined on the basis of the nature of the product, their representative industry and the target customers. A channel is a system of inter­mediaries consisting of merchant and agent business that facilitate the movement of products and services between businesses and consumers. Distribution can be defined as the process of transporting the product from the producer or a business to the final consumer.

Correspondingly, channels of distribution can be defined as the path or route along which the products move from producers or manufacturing businesses to the final consumers or industrial users. The channel consists of suppliers, transporting businesses, distributors, warehousing businesses, wholesalers, retailers and consumers.

The channels of distribution can be considered as the bridge that serves to connect the point of production with the point of consumption. The effectiveness of this bridge can be determined from identification of the target place and time efficiency for delivery of products/services.

(ii) Physical Distribution:

Physical distribution focuses on efficient movement of products from its producers to their consumers through interrelated intermediaries or channels of distribution. These channels are associated with providing the right products in right quantities in the right place at the right time. It attempts to obtain cost savings through low inventories, inexpensive forms of transport and bulk transporting. It also leads to improved customer service levels with fast and reliable delivery systems, ensuring enough stock to cater to customer demand.

Decisions in Physical Distribution/Components of Physical Distribution:

(i) Transportation:

Transportation is required to move raw materials and other resources for production, and to move final products to the point of consumption. Transportation adds value to the goods by moving them to place where these are required. For example- tea plantation done in north-east India is transported all over the world and the value of tea is much higher in other places as compared to the place of production.

The modes of transportation considered by a business are roadways, railways, airways, shipping and pipelines. Decision parameters for considering the mode of transportation are costs of transportation, speed or delivery time, nature of the product, consumer demand, etc. For example- gas and petroleum products are transported through pipelines and perishable goods like food items are directed through high-speed transport system.

(ii) Inventory:

Inventory is a stock of goods that are held by an organisation to resolve demand and supply conflicts and attain economies in transportation. They are maintained for ensuring that there is no scarcity and no oversupply of products/ services. Scarcity and over-supply both can cause price instabilities and speculation in the market. For example- the 2010 Indian onion crisis was a result of onions prices rising to Rs. 135 per kilogram. Initially, the rise in onion prices genuinely began from shortages of onions due to unseasonal rainfall but later on the prices were raised artificially by middlemen.

(iii) Warehousing:

Warehousing involves warehouses or facilities that hold or store the inventory. Warehouses are commercial buildings for storage of products used by producers, importers, exporters, wholesalers, transporters, customs, etc.

Warehousing activities include:

(a) Breaking bulk or dividing and sorting of goods obtained in bulk into small (and manageable) containers. Break bulk involves loading and unloading every piece of product into containers for transferring them to select locations.

(b) Storage warehouses where goods are held for moderate to long periods.

(c) Distribution centres that operate as central locations for fast movement of goods to retail stores.

Decisions on deciding the need and number of warehouses depend upon the product, the reach and extent of market, the nature of product in terms of durability and transferability, customer services and costs of maintaining/managing warehouses.

(iv) Order Processing:

Order processing is a workflow or process that deals with fulfillment of customer orders. The key is to reduce the time between orders placed by a customer to receiving the goods. Order processing involves an integrated network of computer systems which track the customer’s credit rating, monitor the stock of goods, check on orders issued to a warehouse, preparing invoices and updating inventory records.

Steps involves in order processing include:

(a) Salesperson reports an order placed by customers.

(b) Salesperson transmits this order to the company.

(c) The order is entered in the company logs.

(d) The company conducts an evaluation of customer’s credit ratings and history.

(e) The inventory is checked and accordingly a schedule (for production) is prepared.

(f) Materials to be shipped in accordance to the order are also indicated.

(g) Payment for the order is received.

4. Promotion Mix:

Promotion can be described as activities, materials and media used by a marketer to inform or remind prospective customers about particular product offering and attempt to persuade them to purchase or use it. This implies that promotion involves raising consumer awareness of a product, idea or a brand through advertising, publicity, incentive, etc., in order to create demand or customer loyalty.

Promotion mix is thus a combination of promotional methods used for promoting that specific product, idea or a brand. It is associated with persuading and attracting customers and includes elements like personal selling, advertising, sales promotional activities, public relations, displays and demonstrations, participation in trade fairs and exhibitions, etc.

For example, Nagpur-based Vicco Laboratories, founded in 1952 is a manufacturer of brands like ‘Vicco Turmeric’ and ‘Vicco Vajradanti’. To make their products relevant to the current young generation, the company had hired an advertising agency to promote Vicco products’ advertisements through television commercials, print advertisements and posting testimonials of their customers on their company website.

Elements of promotion mix are discussed as follows:

(i) Advertising:

Advertising can be defined as all forms of paid non-personal communication trans­mitted to people through mass media regarding a product, service or idea identified by a sponsor or business. Advertising is one of the most visible manifestations of a marketer’s communication efforts that aim at attracting attention, informing, persuading and reminding consumers towards the marketed product offering through mass media. Mass media includes television, radio, internet, newspapers, magazines, video games, direct mail, outdoor displays, and signs/hoardings.

(ii) Personal Selling:

Personal selling or salesmanship is means of selling a producer’s products/services directly to a customer by meeting him/her face-to-face or in person. According to American Marketing Association, “personal selling or salesmanship is the process of inducing and assisting a prospective buyer to buy a commodity or service or to act favourably upon an idea that has commercial significance to the seller”.

This definition implies that the key participants of this transaction are the buyers or customers whose needs /wants should be satisfied and salesperson (man or woman) who leads customer satisfaction by providing face-to-face and personalised interaction and persuasion.

Features of Personal Selling:

Personal selling has significant features that reflect its relevance to marketing activities of a business.

Features of personal selling are as follows:

(i) Personalised Approach:

Personal selling develops personal contact between buyers and salespersons through face-to-face interactions. This approach also means door-to-door marketing where a salesperson personal literally goes knocking door to door and makes a sales pitch to sell the concerned product.

(ii) Two-Way Communication:

Personal selling is a two-way personalised, verbal communication between a salesperson and the buyer. This communication can visibly capture the moods, emotions, requirements or concerns of the potential buyer and accordingly persuade them to make a purchase. Queries or doubts of customers are quickly resolved by the salesperson before the purchase.

(iii) Expensive Approach:

Personal selling is an expensive approach as it involves direct interaction with customers over long distances and different venues like houses, office space, and so on. Salespersons need to depend upon their personal or public transportation to contact to a particular customer making it expensive in terms of time, effort and costs of food, travel, etc., compared to the minimal volume of sales.

(iv) Lack of Distraction and Better Convincing:

Because this is a one-on-one or face- to-face interaction, communication between potential buyers and sales persons is straight forward and consists of no distractions. Personal selling allows the salesperson to tailor or manoeuvre relevant messages about the product to the consumer. These messages are altered to convince the customers to purchasing the product.

(v) Slow Speed of Sales:

As personal selling involves door-to-door, in-person interaction, the process of sale is usually one or few products per household / office space or other public spaces. Speed of sales is considered to be slow that involves developing interest, persuading the potential customer, negotiating prices and so on.

(vi) Development of Relationship:

In personal selling, the market comes to the potential buyer’s households and the real sale of the product occurs. Salesperson needs to develop a relationship with the customer as they need to answer technical queries and doubts. Responses need to be immediate in order to convince and maintain the attention of the customers.

Role or Objectives of Personal Selling:

Role of personal selling is critical for businesses who have developed new products or whose products cater to a specific need of customers. It is a means to create awareness and provide knowledge on workings of an innovative product can be explained only through real-life demonstration.

For example- when sanitary and hygiene related products like washing powders, toilet disinfectants, bleaching powder entered in Indian markets in the 1980s, knowledge and awareness about the same were created through personal selling in selected metropolitan cities.

Accordingly, role or objectives of personal selling can be summarised as follows:

1. Transmit messages – Personal selling facilitates transmission of personalised messages regarding the products workings, utility, quality and prices.

2. Identification – It enables the salespersons to identify with their prospective customers and make sales representation effectively.

3. Product demonstration – It allows the salespersons to demonstrate the operations of products in comparison to their competing products.

4. Persuasion and establish relationships – It enables salesperson to convince and persuade customers to purchase the products and win their confidence by providing non-selling services and maintaining cordial relationships.

5. Order receipt and feedback – It facilitates a salesman to receive order on the spot and also receive feedback and experiences regarding the product.

6. Future sales – Sales persons can provide relevant feedback about customers’ tastes, preferences, attitudes and habits to the management of the business to make future sales plans.

(iii) Sales Promotion:

According to American Marketing Association (AMA) sales promotion can be defined as, “sales activities that supplement both personal selling and advertising and coordinate them and help them effectively, through displays, shows and expositions, demonstrations and other non-recurrent selling efforts not in the ordinary routine.” The definition implies that sales promotions are different from advertising, personal selling and publicity but complement personal selling and advertising.

It broadly aims at encouraging trial or usage of product thereby changing the behaviour of trade/exchange and changing the behaviour of the consumers. These changes encourage instant purchases of products/services in the short-term and can include contests, demonstra­tions, discounts, exhibition or trade shows, games, giveaways, etc.

(iv) Public Relations:

Public Relations (PR) mainly involves improving relations between the advertiser with media, employees, middlemen, customers, suppliers, shareholders and general public on behalf of a business. It refers to various practices used to build good relations with various sections of the public.

PR can be defined as a deliberate, planned, sustained effort for establishing and maintaining goodwill between businesses and the public. A business uses publicity, exhibitions and articles about organisations’ products in professional or in-house newsletters and handling or heading off unfavourable rumours, stories, and events to maintain good public relations.

Features of Public Relations:

Based on the meaning of public relations discussed earlier, key features of publicity are discussed below:

1. Securing cooperation of public – PR aims at obtaining acceptability about the business’ products/services from the public in order to secure their cooperation and support.

2. Successful relation with public – PR can attempt to develop and change the attitudes of public by creating positive or negative publicity about the product. The attention garnered from this publicity creates a successful relationship with the public.

3. Satisfying different groups – PR can satisfy the expectations of different groups that acknowledge the attention created through publicity of a business’ products/ services.

4. Engaging in dialogue – Businesses that wish to create goodwill or good image attempt to engage in a dialogue through PR. An engaging dialogue also involves exchange of information about the product/service to the public.

5. Ongoing activity – PR is an ongoing activity as it involves engaging and informing the public about the business and their product/services.

6. Specialised activity – PR is recognised as a separate activity though it comple­ments other promotional activities like personal selling and sales promotion. As it involves keeping the public informed in a large scale, PR is considered as a separate business unit like production, finance, sales, etc.

Role and Importance of Public Relations:

Public Relations (PR) is important for a business because of the following factors:

1. More credible – PR is important for customers, as customers can obtain credible information and messages about products and services that are not influenced by its producers. This information and messages are obtained from independent sources making the sources seem possibly dependable and credible.

2. Economic medium – While advertisement is an expensive marketing tool, PR is relatively economical and more beneficial than advertising. PR indirectly encourages word-of-mouth marketing among people that makes it very important especially for producers.

3. Image building – PR creates a positive image of a particular brand in the minds of target customers through regular interaction, press release, newsletters, interviews, events, functions, hiring a celebrity as a brand ambassador or even through charitable functions.

4. Boosting sales – As it attempts to impress different groups of people in large- scale, PR can boost sales of products/services.

5. End of obstructions – PR can satisfy different groups of people and is considered critical under any kind of crisis or unfavourable circumstance. It safeguards the image of the business causing an end of possible obstructions.

6. Easy to attract public – PR is the faster means for communicating information and messages about producers and their products or services. It has greater speed to reach the public through various media tools like newspapers, television, magazines, social media and so on. It provides up-to-date and sometimes real time information that enables them to make informed decisions and choices.

Home››Management››Marketing Mix››