Why Marketing Mix is Important
to Small Businesses!

First, what is marketing mix? The mix section of your marketing plan will concentrate on the tactics used to achieve the plan.

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Those tactics can be categorized as the 4 Ps of Marketing: product, price, promotion and place (or distribution channel).

Second, to better understand what your marketing mix is and why it is so important you need to consider the Four P’s to be the key ingredients in your marketing success recipe. Without those key ingredients you will not achieve marketing success.

How good is your soufflé without eggs? How good is your apple pie without a crust? Get the idea? Marketing mix is critical to the success of your marketing plan. An example of a marketing mix can help you to build your own mix strategies.

The Four P’s of Marketing Mix: (consider product and service to be interchangeable in this discussion)

1. Product:

Without product (or service) thoroughly defined, your marketing mix approach will be weakened.

• Define the features, advantages and benefits (also known as FAB) of your product.

• Define what your product looks like, feels like, and if appropriate sounds like and tastes like.

• Do some product testing before product launching: what characteristics or attributes do potential customers most like; least like. Develop face-to-face or online surveys. Customer feedback before product launch is probably more critical than after launch – typically it is always harder to make changes once the product has been launched.

• Rank the characteristics by importance to the target market.

• Ensure that you clearly understand the competitive advantage your product has – if it doesn’t have any competitive advantage you will have a hard time winning market share.

• Define the unique features your product has that are not easily duplicated – ensure that there is strong product differentiation within your product lines and as compared to your competition.

2. Price:

Once the product is well defined, develop your pricing strategy.

• Is your product brand new? Then it is in the early stage of its product life cycle : the introduction. Gaining market share can be challenging. Price will be a sensitive issue unless the market demand is very high for your product. Where your product is in its life-cycle is important from a pricing perspective.

• If you are launching a better, bigger, different, new, improved product make sure your customers clearly understand the differences and attach your product benefits to your price method.

• Are you a low cost manufacturer or wholesaler? Do you sell high volume, with low cost? If the answers are yes to these two questions, you have room to move down on price if it helps you grow volume quickly. But be careful about following a low price or cutting price strategy – it is often extremely difficult to hold on to profit for very long and pricing is almost impossible to push back up once you’ve set the new low price target.

• Or are you a high cost, niche manufacturer or provider? If you have control of the niche or are building a new, yet-to-be-discovered niche, then typically you can set price high as long as your market values the differentiation of your product.

• Do you have to sell off a large volume of one product to make room for other products? If yes, you may want to consider pricing at break-even to move the product quickly. This strategy of low, break-even pricing can also be employed as a loss leader strategy : price a less important, less valuable but high demand product low to bring in customers; the assumption is that customers will buy other products that are higher priced and higher profit while they shop in your physical or online store.

• Are you trying to buy your way into the market? Be very careful with this strategy – it is often very challenging to move a low price back up. There are a lot of examples of businesses who have failed because their pricing didn’t cover their costs. You're in business to make a make a profit!

When you build your pricing strategy be sure to assess the competition, the market, your potential customers, your long term sales goals, and the product characteristics carefully.

3. Promotion:

Promotion includes a number of marketing tactics focused on communicating with your market. Ensure that all your communications cover the most important aspects of your product: the who, what, where, when, how and why buy story.

Build a strong and consistent product identity and brand that you use regularly throughout all of your marketing communications. Communicate through a variety of tactics – it doesn’t have to be all the tactics listed here but do try to use several communication tactics for a broader and deeper reach.

• Consider direct mail targeted specifically to your market.

• Consider digital media and/or online marketing, particularly if your target market shops online (e.g. buy advertisements through the big name search engines).

• Consider traditional media advertising – print, radio, television. And also consider non-traditional media – how about a car wrap? This is an image or graphic that is created to wrap a car in advertising – if you sell primarily to a local market this is a great way to get your name out there (please go to the professionals to do this). You can also pay a monthly fee to put the graphic on other non-company vehicles.

• Consider building your brand and communicating by building a strong public relations program: talk to your industry’s media, participate in your local community; have your business sponsor or participate in charity events – please do not do this cynically – yes, you can raise your profile but the primary focus should be on doing good in this category of communications.

• Attend industry (and non industry if there is a relationship) trade shows – but only participate with a trade booth if you can put together a strong show and tell with great images, take-aways and a good story to tell. Consider partnering with a non-competing business at the trade show and share the costs – this can be expensive. Participate in a show with measurable goals – you want 200 new leads; you want 30 sales by the end of the weekend; and so on.

• Put together printed materials: point of purchase displays, catalogs, brochures, business cards, letterheads, folders and all the other materials necessary to communicate with your market.

  Make sure that your printed materials reflect the value of your product. In other words, if you have a low cost, low price product a basic print program will be fine; however if you are trying to sell a high cost, high price and high value product your print program (and for that matter, the entire promotions program) needs to reflect that value – or customers will have a hard time buying the brand value.

• Promotion also includes your selling activities: business to business selling and business to consumer selling will need to be considered separately. You need to build a good sales story for your sales effort and staff. Connect the products features and advantages to the benefits for customers. Ensure that customers clearly understand the benefit and the solution you bring to them.

4. Place

Place describes the how and the where of taking your product to market. In the place segment of marketing mix you need to make decisions about which distribution channel you will use.

• Will you sell business to business; such as a manufacturer selling to a distributor or a manufacturer selling to another manufacturer?

• Will you sell business to consumer: such as a retailer to a consumer?

• Will you sell your products with your own sales force or will you contract the sale of your products out to agents or distributors?

• Will you set up multiple locations? Will there be a main warehouse or localized inventory at stores? What kind of inventory level do you need to support your sales plan?

• Will you sell online – some or all of your products?

• How does your target market geography affect your distribution or place decisions?

These are all questions that must be carefully and thoughtfully answered before you decide your place marketing mix strategies.

The Four P’s of your marketing mix are the foundation of your marketing plan.

Strategy can be challenging and time consuming to develop and create.Marketing plan development must include the strategy and objectives you need to handle the product, price, promotion and place elements of your marketing mix.

For a new product to succeed and to achieve planned sales results, small business owners must build a strong marketing mix program.

Note: Marketing Services is the same, but different than marketing products. Marketing services extends the 4 Ps of Marketing, to the 7 Ps of Marketing.

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