The marketing mix

• Marketing mix


  A framework for businesses to create and implement successful marketing strategies
• Four P's


  The key elements of a marketing strategy: product, price, place, and promotion
• These four components work together to satisfy the needs and wants of a target market while achieving the company's objectives
• By understanding and manipulating the marketing mix, businesses can differentiate themselves from competitors, maximise marketing impact and achieve long-term success
• Businesses combine the 4 P's of the marketing mix in appropriate and unique ways to maximise their chances of success
• Product design mix


  The combination of elements that make up a product's design
• Elements of product design

  • Function
  • Aesthetics
  • Cost
• Balancing the elements of function, aesthetics and cost helps to ensure a product's design is both functional and attractive while also being cost-effective for both the manufacturer and the consumer
• Asda's own brand of ginger beer

  • Produced at the lowest possible cost and sold to consumers at a very low price
• Businesses must take care to balance customers' quality expectations with these elements
• The target market may value quality less than price and will not be prepared to pay a high price for goods, even if they are of the highest quality
• Most companies are market-orientated when developing new products
• They spend a lot of money researching consumers' buying habits and their likes and dislikes
• They then design and package a product, which this research suggests people will want to buy
• New product development


  1. Generate ideas

  2. Select the best idea

  3. Develop a prototype

  4. Test launch

  5. Full launch of the product
• Costs of new product development

  • Market research collection and analysis is time-consuming
  • Investment in Research and Development and design can be very expensive
  • The costs of producing trial products, including the costs of wasted materials, can be significant especially if innovative materials/components are used
  • Low sales if the target market is wrong or if market or technical research leads to the development of an inappropriate product or service for the market
  • Damage to the brand if the new product fails to meet customer needs
• Benefits of new product development

  • Sell more products/services to existing customers
  • Developing new products spreads fixed costs like premises or salaries across a wider range of products
  • Diversifying the products it offers means a business is less reliant on certain customers or markets
  • Can create a unique selling point by developing a new innovative product for the first time in the market
  • Charge higher prices for new products
• Branding


  Creating a unique and identifiable name, design, symbol or other feature that differentiates a product/service or company from its competitors
• Types of branding


  • Manufacturer/Corporate branding
  • Product branding
  • Own brand or private label branding
• Examples of ways brands have been built

  • Developing unique selling points
  • Advertising
  • Sponsorship
  • Social media presence and activity
  • Emotional branding
• Benefits of branding to a business

  • Business differentiation
  • Reduces price elasticity of demand
  • Ability to charge premium prices
  • Establishes recognition and identity
• Packaging


  The physical container or wrapping for a product, used for promotion and selling appeal
• Brands are considered intangible assets on a company's balance sheet. A strong brand adds to the overall value of these intangible assets, which may be an important part of a company's net worth and make it more attractive to investors.
• Product life cycle


  The different stages a product goes through from its conception to its eventual decline in sales
• Stages of the product life cycle

  • Development
  • Introduction
  • Growth
  • Maturity
  • Decline
• Implications of the product life cycle for cash flow and marketing

  • Development stage: Cash flow is usually negative, marketing strategy is focused on creating awareness and generating interest
  • Introduction stage: Cash flow is usually negative, marketing efforts are focused on creating awareness and generating interest
  • Growth stage: Cash flow usually turns positive, marketing strategy is to differentiate the product and build brand loyalty
  • Maturity stage: Cash flow is usually positive, marketing strategy aims to maintain market share and increase profitability
  • Decline stage: Cash flow is usually positive but declining, marketing strategy is to extend the product's life cycle or allow it to be phased out
• Low sales growth


  The product is still new and unknown to most consumers
• Cash flow

  Usually negative as the business usually incurs high costs for promotion, advertising and distribution
• Marketing efforts

  Focused on creating awareness and generating interest in the product
• Growth stage


  The product enters this stage when sales begin to increase rapidly
• Business focus in growth stage


  Building market share and increasing production to meet this growing demand
• Cash flow in growth stage

  Usually turns positive as sales revenue increases and costs are spread out over a larger volume of production
• Marketing strategy in growth stage

  To differentiate the product from its competitors and build brand loyalty
• Maturity stage

  Characterised by high sales but slowing sales growth, market saturation is likely
• Cash flow in maturity stage

  Usually positive as sales revenue continues to come in and costs are reduced through economies of scale and efficient production processes
• Marketing strategy in maturity stage

  Aims to maintain market share and increase profitability by cutting costs and finding new markets
• Decline stage


  Starts when sales begin to decline as the product becomes obsolete or is replaced by newer products
• Cash flow in decline stage

  Usually turns negative as sales revenue declines and costs associated with the product's decline increase
• Business focus in decline stage


  Shifting to managing the product's decline and reducing costs
• Marketing strategy in decline stage

  May involve discontinuing the product, reducing prices to clear stock or finding new uses for the product