What is a Marketing –Mix?What is a Marketing –Mix?According to Stanton, “Marketing-mix isthe term used to describe thecombination of four inputs whichconstitute the core of company’smarketing system-the product, theprice structure, the promotionalactivities, and the distribution system.
Inadequacy of Four PsInadequacy of Four Ps• The four traditional Ps of the marketing-mixare adequate for marketing a product. Butthey fail to cover the following aspects,which differentiate products from theservices: Services are intangible in nature Promotion of services usually takes place at thetime of consumption itself In Indian scenario, the public sector producedmost of the services The dual role played by service customers asco-producers and end consumers
Inadequacy of Four Ps Conti..Inadequacy of Four Ps Conti.. The four traditional Ps fail to capture theimportance of distribution for services Consumers are unable to perceive the qualitystandards of services before consumption.
The Expanded Marketing MixThe Expanded Marketing Mix
ProductProduct• Three levels of serviceproduct:The ‘core’ level---tosatisfy important needsThe ‘tangible’ level---manages theappearanceThe ‘augmented’Level---involves theaddition ofsupplementary services These three levels canbe considered into twolevelsExample: Restaurant
Product Cont..Product Cont..• It is easy todifferentiate productsfrom one another whencompared to services• Example: In case ofservices of two bankswhich offer similarschemes and interestrates
PricingPricing• The pricing of services is very differentfrom the pricing of goods for variousreasons:Higher price is generally associated withbetter qualityThe fixed cost is high and the variablecosts are low for a service, Example:HotelPrice of the same service can be changeddepending on the demand for the service,Example: Hotel and Movie Theater
PromotionPromotion• Service consumers experience a high levelof perceived riskService providers should aim to promotetheir services in order to eliminate theelements of this perceived riskPromotion of service provider is equallyimportant in services, Example: Banker• Service personnel and other customers alsoparticipate in the promotion process,Example: Restaurant and EntertainmentPark
PlacePlace• Services are produced and consumed at the same place• Services makes it impossible for service providers toproduce the service at a place where the costs are low andsell it at a place where there is high demand for it• Place decisions involve the following:The physical location of the service provider’s outlet,Example: ATMThe physical appearance and ambience of the place ofservice offering, Example: Hotels of Taj GroupThe decision to use particular types of intermediaries tooffer easy accessibility to the customers and improveoperational efficiency of the organization, Example:Holiday Packages either directly or through touroperators
PeoplePeople• People in a service organization can havean impact on the service offered:Service personnel have an important rolein not only designing the service, but alsoin delivering itThe service personnel play an importantrole in helping the end consumer presenthis requirements preciselyThe perception of a service by acustomer also depends on the othercustomers receiving the same service
ProcessProcess• Marketers of services are often confused, as thereis little difference between marketing andoperations management in services, Example:Airline Service• Customer service encounters have an impact onthe quality of service delivered by the organization• Some service organizations have mechanizedtheir service processes to reduce the element ofhuman judgment and error in service delivery,Example: ATM• Service organizations have identified customersegments of those people who are ready to payhigher prices
Physical EvidencePhysical Evidence• Service providers should try to attachan element of tangibility to theirservice offerings• Example: Broachers or TVcommercials showing the details ofholiday destination, pleasant andcourteous behavior of servicepersonnel , the location and ambienceof food outlet