Entrepreneurship

Quarter 1– Module 4:
Marketing Mix (7 Ps)
 Lesson

1 Marketing Mix (7Ps)

It is very interesting to know that at this point, you can now start a small
business using the knowledge you acquired in your specific strand. It may seem
hard, but trying is the best way to find out. Knowing your marketing mix is one of
the first things that you must consider in putting up your small business.

The marketing mix will help you in knowing what strategies are suitable for
your chosen business. It is the first step to be done even before you create a
business or marketing plan because your marketing mix has an impact on your
positioning, market targeting and segmentation. All the Ps included in the
marketing mix are connected with one another.

Marketing structures are necessary to have a strong foundation before

implementing your marketing activities to increase your chances of success. When
you have a concrete approach in marketing, you lessen the chance of wasting
resources and marketing budget is put into better use.

One of the frameworks you can apply in introducing your product and
services to customers is the 7Ps of marketing. This framework was an adequate
framework for the time which focused on products. Before, there are only 4Ps of
Marketing, but as the economy improves, it was updated by Booms and Bitner in
1981 (Singh, 2018). The 7Ps of marketing is the updated version and that is what
we will learn in this module.

What is It

There are different ways to succeed in entrepreneurship; it may be in the

form of formulas and models; Marketing Mix (7Ps) is one of them. You should use
7Ps formula to continually evaluate and re-evaluate your business activities. The
seven Ps of marketing mix are: product, place, price, promotion, people, packaging
and positioning (Tracy, 2004).

The marketing mix is a significant instrument in planning and executing the

right marketing scheme through operative strategies (Hill, 2016). The assessment
of these 7Ps is very important in the business’ overall marketing approach.
 What is It

Today, we will learn about the first P in our Marketing

Mix, which is the Product.

A product, according to Martin (2014), is something that

gives satisfaction to consumer; be it a need or want. It also
refers to the goods and services offered by business enterprise
to its target customers.

This can be a physical item, a service or a virtual offering. It is

manufactured at a cost and is subsequently made available to the consumer at a
price. Some examples of tangible products are toothpaste, bread, and motorcycle
parts. Some examples of intangible products are massage, manicure/ pedicure,
and bookkeeping service.
Classification of Products:
1. Tangible Physical item that a business enterprise offers. Two
types
are durables and non-durables.
 Durables have long interval between purchase such as
appliances and furniture.
 Non-durables have stronger repeat purchases, such
as food, soaps, and other consumables.
2. Intangible Services are intangible things provided by entrepreneurs
to satisfy the customer such as medical services and
transportation.

A successful product has to fulfill a specific need in the market and it must
be able to do its function as guaranteed. Whether a need or want, a product must
provide clear statement to users and potential customers regarding its benefits and
features.

The economic definition of the word need is something needed to survive

(www.study.com). This includes things like food, water, and shelter; things people
cannot live without.

A want, on the other hand, is one step up in the order from needs and is
simply something that people desire to have, that they may or may not be able to
obtain. This includes new pair of shoes, a high-end cellphone or gadget; things
people can live without but still choose to purchase.
 What is It

Today, we will learn about the second P in our Marketing Mix which is the
Place. Does it play an important role in marketing?

Place refers to distribution or the methods you use for your products or
services to be easily accessible to the target customers. Also called placement or
distribution, this is the process and methods used to bring the product or service
to the consumer (Luenendonk, 2020). Your product or service dictates how it
should be distributed (www.marketingmix.co.uk). An entrepreneur must establish
his/ her business in the most strategic place.

The place where the businesses situate and their accessibility are vital
influences in marketing. Accessibility relates not just to physical approachability
but to other means of communication and contact (Chand, 2019). Thus, the types
of distribution channels used (e.g. travel agents,
middle person) and their coverage are linked to the
crucial issue of accessibility.

Would you like to run your own business?

If you own a retail shop, for example, the
distribution chain ends with you and you supply
to your customers directly. As a manufacturer,
you can decide whether to sell your products
directly to consumers or to sell them to
intermediaries or middlemen to distribute them.

Two types of distribution channels (Mendiola (2017):

1. Direct distribution- the type of distribution where

there is direct sale between the manufacturer
and the consumer.
2. . Indirect distribution- the type of distribution
wherein manufacturer utilizes a wholesaler
or retailer
to sell his/her products.
 What is It

Today, we will learn about the third P in our Marketing Mix which is the Price.
Aside from being the amount of money we pay for a product or
item, what does price indicate in the perspective of the
entrepreneur and how does it affect the marketing strategy?

As specified previously, Price is the monetary value a

customer pays in exchange for a merchandise or service.
Determining the right price for your product can be a bit tricky
because of some factors that we have to consider
(www.marketingmix.co.uk).

A common strategy for beginning small businesses is pricing their

product lower than their competitors. Your pricing strategy should reflect your
product’s positioning in the market. The amount should not project your business
as too cheap or too expensive. Low pricing delays your business’ growth while high
pricing kicks you out of the competition (Acutt, 2020).
Entrepreneurs have the freedom to select what strategy they will use in
pricing. It can be based on the cost analysis of the expenses, competition in the
market, and customer demand.
Pricing Strategies (Acutt, 2020):

 Cost Plus. Cost Plus is taking the production expenses (including labor,
materials and other resources) and adding up a certain profit percentage
and then the sum will be the product’s price.
 Value-Based. Instead of using the production cost as basis, an entrepreneur
can consider the customer’s perception of the product’s value. The
perception of the purchaser is dependent on the product’s quality, the brand
standing, and benefits, aside from the cost factors.
 Competitive. You can conduct a survey of the pricing applied by your
competitors on a similar product that you are trying to sell and then decide
whether to price your product cheaper, the same, or higher. You should also
monitor their prices and be able to respond to variations.
 What is It

Have you watched commercials on television or heard advertisements over

the radio? Today, we will learn about the fourth P in our Marketing Mix which is
the Promotion.

The strategies you use to endorse your product or service in the market is
called promotion. Through it, you let potential customers know what you are selling
(www.marketingmix.co.uk).

In order for you to persuade patrons to purchase your product, you need to
explain what it is, how to use it, and why they should buy it. You should always
make your consumers feel that you can satisfy their needs and wants.

Common Marketing Communication Methods in Promoting (Lumen

Learning, 2020):

1. Advertising is a series of related, well-timed, carefully placed

television ads coupled with print advertising in selected
magazines and newspapers. An effective advertising contains
a clear message that is directed to a certain audience and is
done through suitable channels.

2. Direct marketing refers to direct-to-consumer mail pieces sent to

target segments in selected geographic areas, reinforcing the
messages from the ads.
 3. Personal selling uses in-person interaction to sell products
and services. This is done by the company’s sales personnel
who are personally interacting with the customers.

4. Sales promotions are marketing communication tools for

stimulating revenue or providing incentives or extra value to
distributors, sales staff, or customers over a short time
period. Sales promotion activities include special offers,
displays, demonstrations, and other nonrecurring selling
efforts that are not part of the ordinary routine.

5. Digital marketing is an umbrella term for using digital tools to

promote and market products, services, organizations and
brands. People are now more dependent on digital
communications. There are several essential tools in the
digital marketing tool kit: email, mobile marketing, websites,
and social media marketing.

6. Public relations is the process of maintaining a favorable image

and building beneficial relationships between an organization
and the public communities, groups, and people
it serves. PR is often referred to as “free advertising”.

What is It

Today, we will learn about the fifth P in our Marketing Mix which is the
People. Do you know who these people are?

One of the essential elements of the marketing mix is the people. Everyone
who is involved in the product or service whether directly or indirectly is referred to
as people (www.marketingmix. co.uk). According to Chand (2019), people are the
human actors who play a part in production of goods and service delivery and thus
influence the buyer’s perceptions: namely, the firm’s personnel, the customer, and
other customers in the environment.
People are the most important element of any product, service or experience.
Remember, customers buy from salespeople who they like, so the attitude, skills
and appearance of all staff should be taken into consideration when hiring
employees. People have an important role in product/ service delivery, they are
relied upon to deliver and maintain transactional marketing and people play an
important part to have a better relationship with the customers

Only sales representatives get in touch with the customers, not everyone.
But all of them have their own roles to play in the production, marketing,
distribution, and delivery of the products and services to the customers. Without
them, all these other Ps in the Marketing Mix will not complete a successful
marketing formula.

What you need to understand is that people are the backbone of the
company (Acutt, 2020) —and that is why you have to make sure that you only
have the right ones at hand.
The word right in this context implies that the qualifications and skills of the
person to occupy the position must match the specifications and requirements of
the job. For example, a business venture needs a marketer to promote the product
in Central Luzon; therefore, the business owner must hire a graduate of Marketing
or Business Course and not a graduate of a medical-related course. The technical
proficiency must also be given due consideration.

Finding the right person may also entail cost to the business because the higher
the standards are, the higher the salary level will be.

What is It

Today, we will learn about the sixth P in our Marketing Mix, which is the
Packaging.

Your packaging is the gold star of your marketing mix – it can dictate how
well your strategy is working (Bouma, 2018). The first thing that customers see is
the product packaging, it has the ability to catch or divert their attention in a snap.

Packaging is also referred to as “silent salesman” by the marketing people

because they believe that it helps in accumulating bigger sales and returns (Burks,
2020). They are very beneficial to small enterprises because they only have few
people to promote their product and/or service

Packaging maintains the freshness and quality of your product while using
vibrant designs to tell your brand’s story. It also has the information required by the
government like nutritional facts and warnings that keeps the consumers safe. It
also proves further that you have commitment to transparency and only provide
products that are beneficial to consumers’ lives. The packaging must also be user-
friendly. It must be easy to open, handle, and store.
 Furthermore, packaging will surely appeal to consumers if it characterizes
something that is significant to them or symbolizes someone they aim to be. For
example, shoppers who have environmental concerns may choose product
packaged in recycled and/or recyclable materials. On the other hand, a person
who idolizes someone may select a product because the packaging includes a photo
of his/her idol who inspires him/her.

Elements of Packaging (MetrixLab, 2020):

 Category or product type. The customer should know if a product is

food, non-food, chemical or etc. It is not good to confuse them with your
packaging.

 Brand. This will help you make your product be known to many. The
name of the product is what the customer usually remembers.

 Variant. The packaging should display the possible options for the
particular product.

 Functional benefit(s). The packaging should show what the product does.

 Reason(s)-to-believe. The packaging should also present why the

consumer should find the claimed functional benefit credible.

 Emotional end-promise or benefit. The packaging should also exhibit

how the functional benefit fulfills a higher need.

 Call-to-action. The reason why consumers should buy the product must
also be present in the packaging.

 Size, weight, content details, etc. The information such as stated must
be shown for the consumers to know.

Your packaging should tell the consumer what your product is and why they
should buy it. That’s it. Two questions only that your product packaging design has
to answer.
 What is It

Today, we will learn about the seventh P in our Marketing Mix which is the
Positioning. When buying a certain product, do you prefer branded products? And
why do you favor them?

Positioning is a market concept that

outlines what a business should do to
market its product or service to its
customers. In positioning, the marketing
department creates an image for the product
based in its intended audience. For example,
a manufacturer of a bag may position
his/her brand as a budget- friendly brand or
the other way around; a restaurant owner
may position his/her business as a provider
of cheap or expensive food.

The more intense a positioning strategy is, typically, the more effective the
marketing strategy is for a company. The position of a particular product or service
elevates the efforts in marketing and helps people to become buyers and even turn
them to be loyal customers in the future.

There are several positioning strategies according to Corporate Finance

Institute (CFI, 2020). A few examples are positioning by product benefits, price,
quality, and competition. A perceptual map is used to know how people perceive a
certain brand. The map allows you to identify how competitors are positioned to
identify the opportunities in the marketplace.

Positioning is simply the definition of a certain product in the mind of the

customers. The entreprenuer must always describe the product based from the
perspective of the customers. You must put yourself in their place in assessing the
cost, quality, and variety of the products you offer.