Marketing basics – What are the 4Ps and why are they still useful?

May 11, 2020|Kim's Blog, Marketing|

My latest video (7 minutes) is “Marketing basics – What are the 4Ps and why are they still useful?”. It will help you avoid making a common mistake to ensure that your marketing is effective. The video is designed for non-marketers who want to understand one of the most influential frameworks in marketing and how it adapted for services and to other environmental and technological changes over time.

(Script)

Hi – I’m Kim Tasso. Welcome! (A video introduction to Kim Tasso)

Marketing theory and practice – including within professional service – has continued to evolve and adapt to changing environments and technologies.

A key concept is that of the 4Ps. In this short video we will look at why that framework is so important and useful for you and your firm and how it has evolved.

The original framework is important because it includes some really valuable concepts for everyone to remember when they tackle marketing for their firm or themselves – it gives them a structure.

And when – as a consultant – I look at marketing that isn’t working for my clients it’s usually because people have focused on just one of the Ps to the exclusion of the others.

So watch now and learn how to avoid a common mistake.

The starting point is PLACE

In marketing we aim to be client-centric and focus first on the needs of clients and prospective clients – the target market.

You need to be really clear about WHO you are targeting. And then you can start to develop real empathy with the audience.

That’s where market research comes in. And all of your data analysis – internally as well as externally (think about the competitors and alternatives and what’s happening in the wider environment).

Another important marketing idea is: Segmentation, Targeting and Positioning. STP we call it in marketing.

Let’s look at a Terry’s Chocolate orange as an analogy – we don’t try to eat it whole – we break it into segments to make it more manageable. In marketing, each segment has attributes and needs in common – they may be very different to other segments.

More recently, personas (buyer archetypes) are used to support segmentation to make the audience seem more real – for example, you might be targeting two business owners – but they will be different if they are a young, science start up or an older serial entrepreneur of a series of housing developments.

You also need to identify the needs. And then match or create the services and messages that will resonate with each persona.

Good marketing starts with a focus on your clients and their needs – and what channels to reach them.

Next is PRODUCT – What you are delivering

It’s the same if you are promoting services. Or some other value proposition.

Many professionals focus on the core technical aspects but you must consider the range of things that set your proposition apart – whether that is experience or the relationship or service standards.

Let’s return to our chocolate orange. It’s just chocolate – a commodity. But it is designed and packaged up to be unique. There is a perceived difference. We might associate it with particular occasions such as Christmas.

A strategy often used to differentiate a product is brand – a future promise – creating the perception of difference and higher value in the eyes of the target market.

Then PRICE

This is critical as it drives profit (another core concept of marketing – indeed its definition is about anticipating and meetings client needs profitably)

If the market perceives no difference in your offering then commodity pricing will apply – They will select the lowest price. They need to discern or perceive some added value if a premium pricing strategy is adopted.

(Comparison – it’s around £1.90 per 100g for Terry’s Chocolate Orange compared to around £1.10 per 100g for non-branded orange-flavoured chocolate. That’s quite a difference. But look at the difference between a no-brand pair of trainers and a top of the range, leading brand of trainers!)

The perceived value is relevant too – if you are about to travel to see your Grandma at Christmas and she expects that Terry’s Chocolate Orange you will be much less worried about the price than if you are casually browsing in a supermarket for the cheapest orange-flavoured chocolate for a cake that you are thinking of baking. In the latter scenario you will probably be more focused on the lowest price available.

PROMOTION is the final original P.

This is how communicate your product or proposition to your (market) place.

Many people call this marketing communications. And it is this P where people often focus to the exclusion of the others.

Whilst there are thousands of techniques promotional methods fall into five main categories – advertising, digital marketing, PR (Public Relations), personal selling and sales promotions. We tend not to use Sales Promotions (short term price discounts) in professional services – buy one lawyer get one free!

So you could say that marketing is about getting the right product at the right price to the right market with the right promotion.

How the 4Ps have evolved

Now the Ps have evolved over time – to the 4Cs, the 4Es and the 4EPs to mention a few – Take a look at the diagram. The latest version is described in this 2019 book on advanced marketing management

PEOPLE – the original 4Ps were extended for service businesses to include people, process and physical evidence

I wrap these up into people because in professional services so many people in your organisation play a part in both:

1. Delivering the promised service a particular way (process and physical evidence) and in forming a part of the overall client experience and
2. Enabling your staff to be effective brand ambassadors – they are your day-to-day salespeople in professional services

Internal communications and training are a vital part of keeping your people connected and motivated to deliver the best client service

The 3Rs

Sometimes in professional services we see the 3Rs in use:

Reputation – Revenue – Relationships

And whilst it’s a good framework it worries me a little as it loses that focus on PROFIT which is a main driver of all marketing activity – which you get with the 4Ps and the focus on PRICE.

And it loses the focus on the client needs which you get when you consider PLACE and then PRICE

Anyway, that’s a really short summary of the 4Ps

So – thanks for watching. I feel a chocolate break coming on….