The 4 P’s of Marketing Explained

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The 4 P’s of Marketing Explained

The 4 Ps of marketing are the key elements utilized in the marketing of a good or service. Previously refereed to as the marketing mix, which was introduced by Neil Borden,  was a combination of factors that can be controlled by a company to influence consumers to purchase its products.

While Borden introduced the original model, it was tweaked over the years until Jerome McCarthy watered them down to 4 key factors named, “The Four Ps.” This construct has been widely used among marketers, branding agencies, companies, etc. 

The 4 Ps of Marketing

#1 Product

A product is defined as a bundle of attributes (features, functions, benefits, and uses) capable of exchange or use; usually a mix of tangible and intangible forms. 
Whether it is software, eCommerce, a restaurant, etc. Most businesses our formed around selling a particular product.

Product also includes the experience that customers have with your product.

Often times, the customer experience is one of the bigger determining factors in product effectiveness. 

→ Sidenote: You will notice that all 4 of the marketing elements rely on your customer. Consequently, you should create buyer personas to figure out what strategies are best to approach them. 

#2 Price

The next step is establishing the appropriate price for your product. Finding that perfect price point may take some trial and error as an underpriced product may seem cheap and an overpriced product may seem out of reach of your demographic. 

Naturally, there are some core pricing strategies like subscription, competitive, economy, discount, and psychological pricing.

Subscription pricing occurs most often in software companies who “rent” out their platform to users on a monthly/yearly/etc. time period. Subscriptions can also occur in eCommerce with things like Lootboxes, pre-packaged food, etc. 

Discount pricing is pretty straight-forward. You tend to see it around holidays when companies will have sales and discounts on their products. This bleeds into psychological pricing as consumers love seeing discounts and are more likely to purchase when they do.

Competitive pricing is when a competitors’ prices are taken into consideration when setting the price of the same or similar products. For example, Timmy and Jimmy each have competing lemonaid stands on the same street. Timmy sees that Jimmy is selling his lemonaid for $1. His competitive pricing strategy will be to price his lemonaid at 75 cents. 

Psychological pricing strategies are typically more unconscious. Arbitrary decimals and cents on prices are all examples of psychological pricing strategies. Seeing a bag of chips for $1.29 has a different effect than seeing it for $1.30. 

Fundamentally, the price of your product is determined by your consumers. All of the listed strategies are just ways to move the profit needle slightly. 

#3 Promotion

Strategies that persuade to purchase, influence trail and quantity, and are measurable in volume, share and profit.

Most companies have baseline promotion that explains what their product is and what it does. Some other companies put a lot of effort and time into their promotional efforts. We often refer to this with the umbrella term of “marketing” but specificity is important here.

While marketing is included here, it isn’t only marketing. Promotion is essentially the entire communication flow between your product and your customer. This includes marketing, public relations, advertising sales, etc. 

Because of this, promotion is more than just selling your product. Promotion is a complex practice that aims to build trust, loyalty, engagement, etc. that will help your company grow further than just increasing sales. 

So remember, promotion is multi-faceted and includes all of the external facing communication you create. Keep that in mind when you create public materials to avoid misrepresenting your brand. 

Common mediums for promotion include:

  • social media
  • email marketing
  • press releases
  • guest posting
  • blogging
  • print advertisements
  • television advertisements
  • online advertisements
  • word of mouth
  • radio (if you hate having money)

#4 Place

Place is the means in which you distribute your product to your customers. How is your customer finding your product? Where will you be selling your product (online, in-store, etc.)? 

Most businesses can be lumped into two categories: direct seller or wholesalers. 

An example of a direct seller is a restaurant.

An example of a wholesaler would be Etsy, Ebay, or Aliexpress.

You then have hybrids like Costco or Sam’s Club which are wholesalers who also sell direct-to-consumer. (A very smart model by the way!)

Some businesses will opt to list their products on Amazon or Walmart, effectively transforming them into pseudo-wholesalers because Amazon and Walmart then become resellers. 

The benefit of utilizing resellers is that you can tap into the existing huge audiences those resellers already have. The negative, however, is that your brand name becomes less recognizable to your customer.

Think of the last product you bought on Amazon. If someone where to ask you where you got that product, would your answer be: Amazon?

For me it would. Even though the actual seller might have been a small online shop simply listing their products on Amazon.

Conclusion

The 4 Ps of Marketing are an essential concept to understanding the whole of marketing and what the actual purpose is. 

A lot of companies get caught up in a content creation rhythm or get stuck on one kind of strategy in which they are failing to execute based on an end-goal. 

By keeping these 4 elements in mind, you can adapt more of a results-based approach with your marketing.

Good luck and cheers!