An Explanation of the Seven P's of the Extended Marketing Mix Flashcards
Product
This involves identifying the features, design, quality, branding, and packaging of the product/service available for sale and ensuring that they meet the needs and expectations of customers
E.g. HSBC offers different current accounts to meet a variety of customer needs, with each account having different features
The Premier Account is a fee-free current account aimed at higher income individuals which includes free worldwide travel insurance, overdraft facilities and preferential interest rates on mortgages
Price
This involves identifying the best pricing strategies to use after having considered the amount of money customers are willing to pay, as well as factors such as production costs, competition, demand and perceived value
E.g. Netflix has recently changed its pricing structure to reflect the different needs of customers and achieve further growth
Customers choosing the Standard service which includes adverts pay the lowest subscription fee
Premium customers pay three times as much as Standard service customers but can enjoy advert-free, ultra-HD programming
Place
This refers to the distribution channels and physical location used to make the product/service available to customers
Place involves decisions related to the selection of sales outlets, logistics and supply chain management
Intensive distribution involves targeting the mass market by selling products in as many popular outlets as possible
Exclusive distribution involves targeting high end customers by limiting the sales outlets
E.g. Porsche sports cars are sold through licensed retailers
Promotion
This relates to the activities used to communicate and promote the product/service to the target market including advertising, public relations, sales promotions, personal selling etc.
Promotional strategies are used by firms to make their existing and potential customers aware of their product, build their brand image and encourage loyalty
E.g. Southwestern Airlines makes extensive use of humorous advertising, as well as offering frequent discounts on tickets and engaging in public relations by sponsorship of several US baseball teams
People
This refers to the human resources involved in customer interactions and product/service delivery so as to provide a positive customer experience
Employing, training and retaining the right set of employees is especially important for the success of service-focused businesses
Process
This refers to the operational processes and workflows that enable the smooth and efficient execution of marketing strategies
Process is an essential element as it ensures that the customer experience is consistent, streamlined, and meets or exceeds customer expectations
E.g travel companies such as Germany’s Meier’s Weltreisen sell a range of package holidays that provide flights, hotels and full transfer services while providing resort-based representatives that ensure a smooth vacation experience for customers
Physical evidence
This refers to the tangible elements that customers can perceive when interacting with a product/service such as the physical environment, packaging, and branding
E.g. large fast food retailers such as McDonalds and Pizza Hut create almost identical outlets around the world, with highly recognisable logos and even matching furniture and decor in restaurants
