Do the marketing principles we learned in college still apply today?
Figuring out how to apply marketing theory to your business can be the secret to outmaneuvering your competition.
Most of the entrepreneurs and even online marketers that I know are self-taught. These days, you don’t have to get a degree in marketing to be successful in business. All it takes is gumption and a willingness to figure things out on your own.
However, there’s a downside to self-instruction. When everything you’ve learned comes from a problem you’ve had to solve, sometimes you miss out on the bigger picture. You get so stuck in the details that you never learn some of the broader principles that might have helped you avoid some of those problems in the first place.
Of course, on the flip side of that, there’s the argument that many of the principles taught in marketing courses don’t apply anymore. The world has changed a lot since the Mad Men era when marketing theory was first formalized – do the same theories still apply to the world of online marketing?
To answer that question, let’s take a look at one of the oldest ideas in classic marketing – the four Ps of marketing – and see whether or not they are still a meaningful part of modern marketing.
Where did the 4 Ps come from?
The four Ps have their roots in the 1960s. Back in 1964, Neil Borden wrote an article entitled “The Concept of the Marketing Mix.” In this article, he talked about a variety of “ingredients” that marketers have to combine to create a solid marketing strategy.
In Borden’s original article, there are a lot of ingredients: branding, distribution, product, planning, display, price, advertising, packaging, promotions, and more.
While it was all good stuff, it was kind of hard to remember.
Since marketers love to make things simple and memorable, it wasn’t long until E. Jerome McCarthy boiled Borden’s list of ingredients down into four basic elements that he called “the four Ps of marketing:”
To put it simply, the four Ps of marketing are a simple way to keep track of all the different ingredients that you need to blend to create an effective marketing mix. The specific flavors and ratios of these ingredients will vary depending on your business, but any good marketing plan should account for each of these elements.
Do the 4 Ps still apply?
Now, that all sounds good on paper, but it doesn’t really answer our core question: do the four Ps work in a digital world? So, let’s take a look at each of the four Ps and see if they still apply in the world of online marketing.
As many marketers have discovered, your marketing is only as good as your product (or service). You can’t sell snake oil for very long before you get run out of town.
In today’s online world, it’s even harder to sell poor products or services because the internet facilitates instantaneous communication. It only takes a few unhappy customers to destroy your business.
As a result, the product or service you’re trying to sell matters more than ever in the digital era. It needs to be something that people truly want. Otherwise, your whole marketing strategy is built on a house of cards.
To make matters worse, the internet makes it easy to find alternatives to your product or service. Most of the time, the competition is only a few clicks away, so if anything, your product matters more in the digital age than ever.
On the flip side of the value/cost equation, we have price. Even if people love your product or service, if it isn’t priced appropriately, it will be hard to market.
However, the price you can charge is directly related to your product’s perceived value. This is why Apple can charge so much for their products. From an objective standpoint, Apple products aren’t technically any better than PC products. However, Apple products come with all sorts of added non-technical value: fashionability, prestige, ease-of-use, etc.
As a result, Apple products are perceived to be much more valuable than their PC counterparts (by their fanbase, at least) and Apple can sell them for a much higher price.
Where did all of that perceived value come from? Good marketing, mostly.
In any case, picking the right price point is an important part of marketing. The price your business is charging needs to be consistent with the value people associate with what you’re selling. Good marketing can increase the perceived value of your goods or services, but even Apple has a limit to how much they can charge – your price point needs to match your customers’ needs and expectations.
Here again, the internet has increased the importance of your price. It’s incredibly easy to find your competitors, so if the perceived value of your products or services doesn’t outweigh your price, they’ll go somewhere else.
If you’re like most online marketers and entrepreneurs, when you think “place” or “placement,” the first thing that comes to mind is ad placements. As digital marketers, we spend a lot of time fighting for ad placement and position, so it’s a natural assumption.
However, in the four Ps of marketing, “place” actually refers to distribution, not advertising placement. How do you actually get your products or services to your customers?
Moreso than any of the other Ps, the internet has changed how marketers approach “place.” Back in the 60s, there was no such thing as online shopping. People bought products at a brick-and-mortar store or possibly via a mail-in catalog.
Today, however, people do an enormous amount of research and actual purchasing online. All kinds of goods and service transactions take place without the customers ever setting foot in a physical location.
As a result, figuring out your distribution strategy is possibly even more important today than in the past. Take dropshipping, for example. Many drop shippers have successfully marketed their products online, only to have to shut down their otherwise “successful” businesses due to distribution problems.
On the flip side, one of Amazon’s strongest marketing points is its distribution network. By offering rapid shipping with easy returns, they are able to sell the same products at similar or higher prices and still win over a massive share of the market.
Finally, we have the P that most people spend the majority of their time on promotion. In fact, when most people think about creating a marketing plan, they don’t think much about product, price and place.
Instead, they think about how they are going to get their products or services in front of people. They’re focused almost entirely on promotion.
And it makes sense. Thanks to the internet, marketers have more marketing channels at their disposal than ever. Between classic marketing channels such as TV spots, direct mail, PR marketing, etc and online channels like paid search, social media, influencer marketing, and email, businesses have an almost overwhelming number of ways to reach their target market.
However, all of these various options make picking the right channels especially important. Most businesses don’t have unlimited marketing resources, so they need to focus their time and efforts on the right promotion channels.
The trick here is to figure out the best way to access your target market. If you’re marketing to Millennial mothers, your best shot is probably to focus on Facebook and Instagram. For the retired parents of those Millennials, however, you may get better results from paid search or direct mail ads.
Overall, the digital age has amplified the importance of your promotion strategy. However, while it’s tempting to focus entirely on the promotion aspect of your marketing mix, if you ignore the other Ps, you can inadvertently set yourself up for failure – not success.
The 4 Ps in the online world
As a general rule, the internet has made the four Ps more important, not less. However, the world of online marketing comes with a variety of new challenges that Neil Borden never could have imagined.
For example, buying things online can be scary for your customers. There’s always a risk associated with making a purchase, but when your customers can see, touch, smell, or try on what they’re buying, it’s a lot easier to feel confident in what they’re buying.
Similarly, with a services provider, meeting and directly interacting with the people who will be providing the services goes a long way towards building trust. Online, you simply don’t get that face-to-face experience.
As a result, businesses now have to incorporate building trust in an online medium into their overall marketing strategy.
In addition, because companies often never spend time directly interacting with their customers, they often end up focusing more on the technical details of their marketing approach than the actual people they’re marketing to. The end result? Campaigns that look great on paper…and don’t produce results.
While the four Ps appear to have withstood the test of time, if anything, the digital age has amplified their importance and made their application even more complicated.
The problem is, however, that most businesses don’t think about their marketing in terms of their overall marketing mix. Instead, marketing has become synonymous with promotion. As a result, many companies get overly focused on promoting their business and forget how important price, product and place actually are.
So, do the four Ps still apply? Absolutely. In fact, if anything, figuring out how to apply the four Ps to your business can be the secret to outmaneuvering your competition. After all, if you can incorporate the four Ps more effectively than your competitors, you have the foundation for a marketing strategy that will help you win online.