Nearly every company on the planet sets out with the main objective of making money. This is generally done by producing some form of product, or offering a service, and then charging customers money for it. This fundamental principle is fairly straight-forward, though it contains many intricate details.

Firstly, it is a very rare case where a company can offer a product or service that is genuinely unique and cannot be provided by anyone else. This means that your company will be competing with other businesses that sell a similar item and you will both be trying to make money from the same shoppers, who only want to spend their cash once.

Marketing is the primary tool used by modern organisations to draw potential customers to do business with them and not with their rivals. It is a very broad topic that is influenced by a great number of internal and external variables, but when done well it can be the one business practice that can make or break a company.

So where should you start when constructing a marketing strategy for your own business? Well, each situation is different, and each industry will have its own set of strengths and weak points that must be taken into consideration, but there is a marketing rule that can be applied to almost any company to be used as a marketing framework.

The Marketing Mix

The marketing mix was a phrase that was first coined in the 1950′s and is an expression that is used to express the fundamental building blocks of any marketing strategy. It demonstrates the fact that marketing is not a simple, blunt-edged business technique, but rather a delicate balance of different aspects of business functions. It got its name since it is similar to the ingredients checklist for a recipe.

The term was later developed to include the idea of “four P’s” that described the critical elements of the marketing mix. The formalisation of these P’s made it very clear for company managers and marketers to swiftly associate the elements of marketing to the strengths of their own organisations, and by doing so could very rapidly form a personalised and effective marketing system.

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Product

Although every element of the marketing mix is a requirement, the “product” element mentioned as one of the four P’s is perhaps the most critical of all. It identifies the physical product or intangible service that your business will be selling, and at the end of the day it is the reason that customers are going to spend money with you.

Many people don’t think that marketing has any place to play when it comes to the physical product that your company is selling. In fact, the common train of thought very often bears the precise opposite sentiment. Surely it should be the opposite way around – your manufacturing department creates an item for sale and then it is the task of the marketing department to find ways to sell it, right?

Take the computer software market as an example. There are many well-known brands of both operating system as well as software application products on the market already, and because the market is fairly well saturated it would be incredibly tough (and expensive) to “take on the big boys”. So how can the principles of the marketing mix help in this situation?

Rather than developing an operating system and then attempting to craft a marketing strategy to take on the likes of Microsoft or Apple, it would be more effective to look at what types of product are sought after in the current marketplace, and how feasible it would be to manufacture and sell them. By being aware of the marketing mix early on in your product development period you can avoid business dead-ends at a later stage.

Once your products have been designed and created it is still a vital skill to be able to objectively review your own products to identify the reasons that a customer would buy your product rather than a competitors’.

Another form of this part of the marketing mix is called product variation and is generally used to either lengthen the lifecycle of a product already in the market, or to make your new product attractive to as many consumers as possible.

The car industry uses this technique very effectively by offering different engines, trim packages and interior options with the cars that they offer. They use the marketing mix to great effect to sell their own products in an extremely competitive marketplace.

“Product is paramount” is one of the mottos applied in how to make chocolate company which aims to point out to all staff that we expect top quality manufacturing.

Price

Another important factor in the marketing mix concerns the price of your products or services. This isn’t a simple case of carrying out market research to determine the highest price that your customers would pay (although that can be a useful tool to use), but rather using the price of your products as a strategic tool designed to achieve any particular targets your company has.

Although it may seem obvious, it is still worth noting that price has always been, and likely always will be, one of the key factors that shoppers take into account when they are making a purchase. It is also worth noting that customers do not constantly consider the cheapest price to be the best value.

There are many questions that you need to ask yourself while devising a good pricing strategy, key amongst which are the price sensitivity of your clients, what your competitors are doing and how can pricing boost your own profits. From a strategy point of view though, pricing can be covered by two primary principals; price skimming and also penetration pricing. These are outlined below.

Price skimming

The principal idea behind price skimming is to make as much cash as possible from the segment of the market which is price-insensitive and will be prepared to spend a premium amount of money to get a product or service early on. Not only can this approach deliver great economic benefits, but it can also promote an exclusive and high quality image of your product.

This pricing technique is very often used in the consumer electronics industry where customers will often eagerly await the release of a new mobile phone or computer games console. Manufacturers could set nearly any price they wanted to and there would still be a loyal core of customers that would pay it.

Penetration pricing

Penetration pricing is at the opposite end of the pricing spectrum, and is geared towards gaining a large market share at a short-term cost so that monetary rewards can be earned long into the future. It can be a high risk strategy, but when used correctly it can create revenue streams for many years to come.

Another thing to bear in mind is that “price” is the only part of the marketing mix that will generate revenue for a business. The other members of the four P’s will all cost money to produce or undertake. So it is even more vital to get your pricing technique right.

Following using on-line tools to compare key word lookup popularity we chose chicken cooking to lead our campaign for online promotion as well as off-line advertising materials.

Place

Place is the portion of the marketing mix that’s often overlooked by companies, but it is still an important part of selling your product effectively. In short, it describes the method in which you provide your product to your consumer, and subsequently how you collect money from them.

The most typical ramifications of place-based marketing are the physical venues in which your products are sold. For the vast majority of consumer products, this includes the distribution infrastructure between your production plants and shops and other outlets around the country. Since distribution of a physical product costs money it is important to identify your own priorities and adapt your distribution network accordingly. This is the primary application of this part of the marketing mix.

With the growing use of the Internet by your prospective customers, marketing strategies have had to consider how they use the Internet to help deliver their products. By using the Internet as a place of contact (or even as a complete distribution channel in download-based markets such as MP3s) firms are now able to reach out to a large pool of possible customers.

Promotion

When you say the word “marketing”, most people instantly think of the promotional side of the marketing mix, although as we have seen, this is only one branch of a more comprehensive system. Promotion can be used on a very individual basis or as a mass communication instrument, and whilst it might be an expensive undertaking it is often an essential one. The key concern of promotion is to deliver a certain message that will boost sales.

Advertising is one of the most typical forms of promotion. Typically it would be done by posting on billboards, producing short clips for TV and radio or by physically distributing flyers or leaflets to potential buyers. With the arrival of the information age we have seen a great increase in promotion via e-mail and the Internet, or just as targeted advertising materials posted through your front door. The potential for individualised advertising has never been so good.

Another significant part of promotion involves branding, which will not necessarily yield more sales directly, but relates back to one of the initial purposes of marketing; getting customers to choose your product over those of your rivals. When all other pieces of the marketing mix are equal it could be branding that swings a customer’s decision.

Putting it into Practice

As previously mentioned every company is unique and will have different marketing needs. By using a mixture of the four P’s reviewed above you can take an effective view of your own marketing strategy.

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Introduction We’ve all seen the media frenzy over the banking fiasco, the so named “credit crunch” and redundancies as companies panic. In talking with clients and customers it’s becoming quite clear that there is a need for business as usual. Products still need to be made, distributed and sold and services commissioned.

 

The car industry has seen a massive down turn in sales but just watch any commercial TV station, have the ads disappeared, no, has your favourite newspaper or magazine disappeared from the shelves, the answer is probably no.

In our experience there is plenty of business out there and buyers want to deal with positive and enthusiastic people. Cutting back on marketing budgets is not good for your business and the wider economy. Keeping your company in the public eye is paramount. Adopting hermit strategies and falling back on old campaigns and images only dates your identity and makes you less visible. Just take a look near Christmas time, at a certain men’s aftershave featuring a man and the ocean. It’s been recycled for the last ten years as I can remember.

Ask you self this question; “Who would you rather do business with, a positive, enthusiastic company that seeks the opportunities or one with its head buried in the sand crying credit crunch?”

Recycling is the buzz word of this decade but not when it comes to marketing and PR, your brand image or customer communications, these need to stay fresh and up to date. The same applies internally with your employees, keeping them motivated with a positive outlook reflects in how they deal with customers. People buy from people and they come back to happy helpful people.

So before you all reach for the sick bucket or discard this as pure puff, remember it’s about having a balanced view but on the optimistic side of the fence.

The Detail behind It So lets take a few of the issues raised in the introduction and look at these in more detail.

 

Media Frenzy We see this increasingly over something that could be described as trivial. Just look at the pandemic swine flu story, breaking it back to the real world, a girl went on holiday and came back with a bit of a runny nose!

 

Within just a few hours of media interest in a story you can be the biggest thing from Boston to Budapest, all caught high def, colour corrected, computer enhanced. But what many articles lack, is depth and realism, it’s easy to whip up a panic or over reaction to an event, it’s harder to take a balanced view and report the facts, why, because that takes time, creativity, but is less interesting and doesn’t sell newspapers or generate viewer ratings and we site page views.

The press can be your friend or you foe – it all depends on if it’s a slow news day and what side of bed they got out of!

Take the banking fiasco as already mentioned, if this had been reported more neutrally then less banks, local authorities, businesses and home owners would have suffered. Fewer jobs would have been lost as less panic and knee jerk reactions created as companies laid off thousands of staff amid a banking freeze on loans and credit. All of which were perfectly acceptable the day before!

A firm’s marketing communications are at the mercy of the media as their reputation can be made or destroyed in the papers and that too, of the confidence in a business economy. As they say in the City “buy on fact sell on rumour!”

Layoffs and Panic Leading to Motivated Staff?

Well that would be great wouldn’t it? Well taking into account what has been said so far, lets take a look at two set ups, the panic company and the realistic company.

The Panic Company

Watches the news and lays off all un-required staff – well un-required in their opinion, so they remove the temps, operations and marketing all seen as an unnecessary balance sheet item. Sounds good to a Financial Director. Wrong. Now you have no market presence, no new campaigns and no new customers and because you sacked operations, no one to do the work!

The Realistic Company

This company looks at its sales, balance sheet and order book. Gathers its staff and makes a statement – no layoffs if we can maintain our present position. What the directors say no growth, what about my bonus! Well they are just that, bonuses not guarantees. This is where maintaining a market presence and sales in a recession should be considered as growth! Alien concept – no it shouldn’t be because your company is not going backwards like everyone else’s. With them cutting back and you maintaining presence and sales you gain market share – just by doing the same thing you did last week with the same team of people.

This company then communicates with its employees and motivates them to look for opportunities, the ways to maintain sales, retain customers and to seek the sales and to deliver the service. Other companies will not, because they are panicking, laying off staff and failing to deliver on service. Their staff will be distracted, worrying about redundancy and are unfocused on the job, that or they just will not care.

Strategy

Hermit strategies leading to budget cut backs again are based on knee jerk reactions to a change in market conditions. Companies need to start being led by marketing and market conditions, not by accountants that only have historic information to base decisions upon. Sets of management accounts don’t show market opportunities and don’t motivate staff to go that bit further to look after an existing customer.

Now is the time to exploit the panic and cut backs your competitors are making and to raise your presence in the market place. Crawling under a rock and hoping it’ll get better just means people lose interest in you. Your competitors are concentrating on something else, now is the time to make a move. There is also another key opportunity, a market full of skilled people looking for work – you could gain some key assets, a time to change out some dull pennies and gain a shiny new 5p!

Marketing

So how does a company become less visible in a market place? As a marketing communications consultant, this can happen in two ways, less Marketing and PR and less customer communication.

Employees still read newspapers and magazines; it’s one of the last cut backs they make, their favourite read. This is where a well thought out PR strategy can work and it’s cheaper than display advertising and if you can do it in house – it’s essentially free.

The public still visit websites – so keep them up to date with fresh content and images. Find information that your customers would need or be interested in.

Direct Mail has for a long time featured less, due to the low response rates. How does 98% wastage sound when you try and justify the cost? Well targeted small campaigns can give 12 – 20% response in my experience. Some of this has transferred online but as the public have got fed up with Junk Mail, so too have they started to shy away from an over full Inbox. Subscription based newsletters are one way to build both customer and prospective customer awareness of your company .

There are of course other tactics like sponsorship but measuring the response and attributing it to direct sales becomes more difficult. Exhibitions and trade shows used to do well, but with more sellers selling to you and less footfall from the buyers, picking the right event is paramount .

Internal Communications

Internal communications is in some organisations far from the agenda of the board room table; in others it is fully integrated into the organisation and embellished with the drive and determination of top management so that it succeeds. Good internal communications strategy and implementation motivates work forces and generates clear, useful communication to drive the company forward and ensures all employees take ownership of the positive side of honest communication of both opportunities for improvement and praise of fellow workers. Employees need to know what direction an organisation is heading in, where their individual and team roles fit in and what they have to do in order to achieve the goals set. People will put every effort into advancing the business if they can communicate their ideas.

So what do Internal Communications strategies look to achieve , well with many organisations it is the desire to further the quality standards needed in the business environment and to transpose that need internally towards its employees. With others, it is driven by the speed at which the business environment is changing and hence the need for the firm to change. In this case good internal communication is delivered through a company vision and a change in focus toward face to face or more personal communication.

In order to achieve this, an organisation must understand several aspects to the organisation. It is necessary to understand the environment of the employees and what likely influences there are. These factors that influence employees include line management, immediate workers and any subordinates. As well as their own set of values, but also, those of their colleagues that surround them in the working environment. The important points of influence are, and always have been, our own co-workers. Peers influence more than managers influence subordinates. Added to this are the issues of culture and the sub culture of the company. Politics play a part as does the management style. In all a complex set of variables are at play.

The communication environment is conceptualised via the modification of the concept of communication taken from the Chartered Institute of Marketing. The author has added to this concept to include the environment of the employee.

If the company understands the environment of the employee then it can use the best methods to get information to each person.

The second aspect the firm needs to understand are the perceptions of the employees concerning the information they receive. If the firm understands this aspect as well, then it will know what information is best received. Hence an appreciation of these two aspects will indicate whether or not an Internal Communications strategy is working. Management is then in a position to either continue or change its strategy.

The importance of this article is to bring to the fore the need for organisation to appreciate these two key aspects of the organisation and then to plan an Internal Communications strategy that works.

Author : Peter G Davey MA DipM