Marketing MIX- Outline Marketing The 4 P’s The 7 P’s Promotion strategy People strategy Physical evidence strategy Process strategy Dr.D.Shoba MBA, M.Phil, Ph.D Marketing Organizations use marketing to develop and sell their products and services. Most firms have a marketing department that carries out the functions of marketing. How to market products and services. The main emphasis is on the marketing mix which is the specific combination of interrelated and interdependent marketing activities that an organization does to achieve its objectives. When we think of the marketing mix we often think of the four P’s. These are sometimes called the controllable variables because they can be manipulated by marketers. Dr.D.Shoba MBA, M.Phil, Ph.D Source: Adapted from McDonald (1999) The 4P’s Product Developing objectives and policies for product additions, modifications and deletions. Deciding on what core product and supplementary services to offer. Resolving issues such as what design, branding and positioning to use., Price Developing objectives and pricing policies to be used for product groups in market segments. Place Developing objectives and policies for channels of distribution, Resolving location issues. Promotion Developing objectives and policies for communication with customers. Resolving issues concerning advertising, publicity, personal selling, sales promotion, public relations and direct marketing Dr.D.Shoba MBA, M.Phil, Ph.D The 7P’s However the 4Ps have been much debated and extended to include other elements. We shall follow Cowell's (1984) approach which is to consider services to have seven elements in the marketing mix (i.e. 7Ps). Product Price Place Promotion People Physical evidence Process Dr.D.Shoba MBA, M.Phil, Ph.D Source: Adapted from McDonald (1999) & Cowell (1993) The Additional P’s People Developing objectives and policies in relation to behavior, attitudes, and interpersonal selling skills in service delivery. Physical Developing objectives and policies for evidence the physical environment, facilitating goods and other tangible clues. Process Developing objectives and policies for the processes, mechanisms and routines used to create and deliver service. Dr.D.Shoba MBA, M.Phil, Ph.D Marketing Mix Remember that by adapting the marketing mix elements, you can develop a marketing program that achieves your objectives. The marketing mix elements will often alter as a product-market changes, and a business continues to look for ways to be successful. Here we will look at promotion, people, physical evidence and process. Dr.D.Shoba MBA, M.Phil, Ph.D Topic 1 : Promotion Strategy Examine the communications process and describe the two parties that are involved, the sender (usually the business) and the audience (the customers). 6 promotional tools that restaurants can use in a promotion strategy: advertising, publicity, direct marketing communications, sales promotion, personal selling and public relations, Topic 2: People Strategy Employees of service businesses The service encounter and the role of internal marketing. Customers and their 3 roles: as producers of services, as users of services, and as an influence on other customers. Topic 3: Physical Evidence Strategy We look at how a servicescape includes the physical environment and the atmosphere of an organization. 3 ways that buyer behavior is affected by the look and feel of the environment and image a business creates. Topic 4: Process Strategy We examine what a service process is and at why managers need to think about complexity and divergence in service processes. Dr.D.Shoba MBA, M.Phil, Ph.D The services marketing mix: People (1 of the other 3Ps) People: Front-line staff manage the service encounter by the critical incidents, which determine customer satisfaction with the overall service encounter. Boundary spanning: Can create problems for front-line staff — usually the link between the service and its customers. Dr.D.Shoba MBA, M.Phil, Ph.D Creating customer service-focused management Top management Traditional Middle management organisational Customer-service staff structure Customers Customer- Customers service focused Customer-service staff organisational Middle management structure Top management Fig 9.3 p 280 Dr.D.Shoba MBA, M.Phil, Ph.D People The right contact staff: Recruit those with the right attitude and ‘service personality’. Empower contact staff: Front-line staff need the authority to make decisions. Reward staff for service delivery: Have reward schemes that ‘work’ as acknowledgement. Dr.D.Shoba MBA, M.Phil, Ph.D The services marketing mix: Physical evidence (1 of the other 3Ps) Physical evidence: Aims to offset the intangibility of the service. This incorporates tangibles such as: Location and building exterior. Interior design and décor. Stationery, uniforms and promotional material. Dr.D.Shoba MBA, M.Phil, Ph.D Servicescapes The physical evidence used to influence the responses and behaviour of customers and staff. Servicescapes have 3 elements: Stimuli — the tangible elements. Customers and staff who receive the stimuli. Responses — stimuli response or outcome. Dr.D.Shoba MBA, M.Phil, Ph.D The services marketing mix: Process (1 of the other 3Ps) Process is the operational system or method used to ‘actually’ deliver the service. Service providers need to: Commit to one approach or the other. Separate standardised and customised services. Create flexibility capacity. Increase the amount of customer participation. Smooth the peaks and troughs in demand. Dr.D.Shoba MBA, M.Phil, Ph.D.