Seven Marketing P's

Marketing Strategy

Every business management and marketing students knows that there are elements of marketing mix and it is better known as the 7 P's Marketing Mix.  Its common sense strategy to know these as an anchor in achieving an effective market penetration in any organization of business.  Be it a small mom and pop store, to online business, to big institutional businesses.  An effective marketing strategy will help you to define the overall direction and goals for your marketing. Your strategy should articulate how you are going to deliver your products or services in ways that will satisfy your customers.

Once you have defined your customers or target market, you need to start developing and implementing tactics or ways to reach them. The marketing mix will make up the tactical elements you will use to carry out your strategy and reach your target market.

Market Tactics

Identify the tactical action steps which will turn your strategy into a reality in your marketing plan, using the guide below. Here are the 7 P's of Marketing:

1. Your product or service

What product or services are you going to offer? Discuss the branding, the packaging (where applicable), and ongoing product or development. You should consider the features and benefits you offer, your unique selling points (What makes your product/service different from everyone else's) and what potential spin-off products of services might be.

2. The pricing of your product or service

Price is a critical part of your marketing mix. Choosing the right price for your products or services will help you to maximize profits and also build strong relationships with your customers. By pricing effectively you will also avoid the serious financial consequences that can occur if you price too low (not enough profit) or too high (not enough sales).

3. Your position (place) in the marketplace

Whether it's a retail store, online shop or on social media, 'place' refers to the channels and locations for distributing your product, related information and support services. This is how you will position your product in the marketplace, it's the location where a product can be purchased. Often referred to as the distribution channel, this can include any physical store (e.g supermarket) as well as virtual stores (e.g eBay) online.

Being in the right location can be a deciding factor in whether a customer buys from you or not. To find out where your ideal customer is buying from it's worth doing some market research.

4. The promotion of your product of service

How do you promote and market your business now (or intend to)? Regardless of how good your business is, if you don’t promote it and tell people you exist, it’s unlikely you will make many sales. Promotion is about attracting the right people to use and reuse your business. There are a number of techniques to use and they can be combined in various ways to create the most cost effective strategy for your needs. This can include online, branding, public relations and advertising.

5. The people in your business (e.g. salespeople, staff)

If you have employees in your business, they can influence the marketing of your products and services. Knowledgeable and friendly staff can contribute to creating satisfied customers, and can provide the unique selling experience that an organisation is often seeking. If an outstanding team provides a competitive advantage, then the quality of recruitment and training becomes essential to achieving your marketing objectives. Make sure you have processes and training in place to get the most out of your team.

6. The process represents the buying experience

Process represents the buying experience the customer gets when they buy your product or service. For example, the way a fine bottle of wine is presented and served in a restaurant, the reaction of a business to a complaint or the speed of delivery in a fast food outlet.A poor process can undermine the other elements of the marketing mix. Budget airlines, for example, may offer very competitive headline prices, but if the final price is inflated by additional charges such as baggage charges and administrative fees, customers may begin to feel they have been taken advantage of.

Try to document your key processes and procedures so your staff and suppliers know what to aim for.  This should include:

• financial
• information technology.

7. The physical environment where the good/services are presented

The physical environment where your products or services are sold and delivered can have a significant impact on how your customers' experience your business. The physical environment can be the quality of the furnishings in your consulting rooms, the design of your reception area or website.

Creating a positive physical environment doesn’t have to be costly – a vase full of fresh flowers or a creative window display can make a big difference.

Advantages and Disadvantages of Online Retailing

Having worked for some of the Philippines fast-growing E-commerce pioneers such as Lazada.com.ph, and had one way or the other communicated with top titans of Philippine E-commerce business such as the managing director of CashCashPinoy, Business Development Managers of Ensogo, Managing Director of Zalora.com.ph. Indeed the e-commerce landscape business in the Philippines has made some dramatic turn around from several years ago.  Filipino individuals and households now embrace convenience online shopping and has avoided the dreaded Metro traffic turns to online marketplace to get their essential needs and wants such as gadgets, mobile phones, kitchen appliances, dining wares, clothings, shoes, and even freebies on spa, skincare products and many more.

Online retailing is growing at an astonishing rate, with online sales now accounting for around one quarter of the total retail market. Retailers who ignore e-commerce may see their trade lessening as customers continue to shift to ordering products online. However, you need to think carefully and weigh all the advantages and disadvantages - backed by good market research - before deciding on whether or not to trade online.

Advantages of online retail

The benefits of retailing online include:

·         Easy access to market - in many ways the access to market for entrepreneurs has never been easier. Online marketplaces such as eBay and Amazon allow anyone to set up a simple online shop and sell products within minutes.

·         Reduced overheads - selling online can remove the need for expensive retail premises and customer-facing staff, allowing you to invest in better marketing and customer experience on your e-commerce site.

·         Potential for rapid growth - selling on the internet means traditional constraints to retail growth - eg finding and paying for larger - are not major factors. With a good digital marketing strategy and a plan a scale up order fulfilment systems, you can respond and boost growing sales.

·         Widen your market / export - one major advantage over premises-based retailers is the ability expand your market beyond local customers very quickly. You may discover a strong demand for your products in other countries which you can respond to by targeted marketing, offering your website in a different language, or perhaps partnering with an overseas company.

·         Customer intelligence - ability to use online marketing tools to target new customers and website analysis tools to gain insight into your customers’ needs. For more information on driving sales through online advertising see how to develop an e-marketing plan, and for advice on improving your customer’s on-site experience.

Disadvantages of online retail

Some negatives of online retail include: 

·         Website costs - planning, designing, creating, hosting, securing and maintaining a professional e-commerce website isn’t cheap, especially if you expect large and growing sales volumes.

·         Infrastructure costs - even if you aren’t paying the cost of customer-facing premises, you’ll need to think about the costs of physical space for order fulfillment, warehousing goods, dealing with returns and staffing for these tasks.

·         Security and fraud - the growth of online retail market has attracted the attention of sophisticated criminal elements. The reputation of your business could be fatally damaged if you don’t invest in the latest security systems to protect your website and transaction processes.

·         Legal issues - getting to grips with e-commerce and the law can be a challenge and you’ll need to be aware of, and plan to cope with, the additional customer rights which are attached to online sales.

·         Advertising costs - while online marketing can be a very efficient way of getting the right customers to your products, it demands a generous budget. This is especially true if you are competing in a crowded sector or for popular keywords.

·         Customer trust - it can be difficult to establish a trusted brand name, especially without a physical business with a track record and face-to-face interaction between customers and sales staff. You need to consider the costs or setting up a good customer service system as part of your online offering. 

Generate New Ideas Competitiveness

In a time when innovation and new product development are vital to remain competitive, large organizations are looking for ways to generate and execute new product ideas while mitigating risk. Increasingly, these companies seek to create a startup culture as a means to generate innovation.

While many potentially valid ideas are identified, few are pursued when a company lacks the strategy and infrastructure to bring these ideas to fruition. Many companies do not have the ability to produce ideas, even if only to develop prototypes and put them in users’ hands in a reasonable time frame.

Developing an efficient mechanism for getting products from the idea phase to initial prototype (and then to market) has significant benefits:

• Quicker idea validation. The product development cycle begins much sooner and the time to validation is shortened. This enables the company to arrive at a “go/no go” product decision within weeks rather than quarters.
• Cheaper and lower risk idea evaluation versus a full blown product launch .
• Management has the opportunity to be involved in product evaluation, rather than being removed from the product development and validation process.
• An increased sense of reward for the idea generator(s), fostering a culture of innovation for the company as a whole.

Identified below are several tools for getting products from the idea generation phase through initial prototype and then to market:

Rapid prototyping

One lower cost, lower risk method for testing product viability and bringing products and services to market is Rapid Prototyping. This involves instituting processes to quickly convert ideas, even if they are only 25-50% complete, into live products that can be placed the hands of potential users or testers. Zynga, the social gaming company, was a pioneer of releasing games that were less than 100% complete and leveraging user feedback for product enhancement. While Zynga’s overall business model has been tested over the past several years, their ability to rapidly develop, iterate and improve their games can be leveraged broadly in software and product development.

Rapid prototyping has several requirements and attributes, including:

• Robust and flexible product development expertise, as the ideas may be broad in nature.
• Expedited development capabilities, often executed without a complete set of user requirements.
• Internal rapid development capability or effective outsourcing via strong third party relationships. Both approaches typically require introducing external personnel and methodologies.

Leveraging internal resources for idea generation

Tapping into an organization’s typically underutilized internal resources can help generate solutions to customer pain points. In the process, however, the organization may produce an unmanageable number of ideas, many of which are not product-worthy or supported by a strong business model. While only one in 20 ideas may be worth exploring, several high impact products may result from internal idea generating efforts.

In order to properly generate and manage internally sourced ideas, companies should address the following:

• Create a repository of ideas, generated from across the organization, including problem addressed, features, use cases and authors.
• Develop a straightforward methodology to evaluate ideas.
• Rank ideas based on customer need and commercial success probability.
• Estimate resources required for initial prototyping and minimum viable product (MVP).
• Create a feedback loop for ideas that pass the initial screening. Keep the originator informed and provide him or her the opportunity to stay involved with the idea as it advances through the testing and development phases.

Corporate “Labs”

Some large, multinational organizations, such as MasterCard and Deutsche Telekom, have developed internal “labs” to generate new product ideas and bring these products to market. These labs have several objectives, including:

• Develop a platform and methodology for new idea generation.
• Create internal awareness of the company’s quest for new products.
• Establish a vehicle for internal product development and validation.
• Create a platform to interface with third party developers and partners.
• Signal to the market that the organization is interested in external partnering and collaboration.
• Identify potential partners and/or acquisition targets.

While an internal lab can be an effective vehicle for generating ideas and developing products, it can also create the perception internally that the group is merely a “skunk works” initiative and not core to the business. Management must be diligent in integrating the lab’s message, methodology, and personnel into the broader organization in order to facilitate effective company-wide collaboration.

Conclusion

Product innovation and getting new product to market quickly is increasingly important but often difficult to execute. Management can help by developing an environment that supports rapid prototyping, harvesting internal ideas, taking calculated risks, and eliminating friction in getting products developed and into the hands of potential users. Internally generated products often solve customer pain points, and with proper recognition, inspired employees may continue to produce innovative ideas for years to come.

Catching Retail Pilferage

Every year, retailers, businesses has to conduct an annual audit and inventory check of all their merchandise on hand.  To ensure that whatever inventory information they have in their computer system are accurate, to know if they have excess inventories or there has been losses, and more often there are alot of losses due to pilferage, wrong encoding of quantities of stocks, typographical error in inputs sometime in the past several months.

Its a tedious process, more often being done manually.  I have worked for a major footwear brand in the past that after conducting the inventories, we discovered a huge discrepancy in the quantity indicated by our system as against the actual stocks on hand of each stores and after carefully reviewing inventories, deliveries, actual counts, we conducted a thorough investigation on the matter.

I have to personally review input data, financial data, stock records and when I couldn't seem to actually find any probable explanation, I decided to look into our importation records, bill of lading yet still did not significantly gave me an answer, so I have to request records of all past cash register receipts from the accounting department. A tedious, prolonged hours of checking, auditing, analyzing the receipts, Lo and behold, I got my answer, there were several transactions that does not match the actual record.

I was curious why the receipts has shown several transactions that have suspicious void cash transactions, yet several credit card transactions and later also being voided.  This made me delve deeper into the matter and requested top management to do reassignments of staffs, Previous cashiers and store managers has to be transferred to other outlet stores, the old sales staff has to learn cash registering, I hired new staffs to fill the vacancy due to the "promotion" of previous sales and inventory staffs.

I have to observe the behavioral pattern amongst those I have to move to other stores, especially the store managers and the cashiers, and whenever I frequently visit them on a regular basis, gets to hear some complaints of their reassignments, ranting their dissatisfaction and grievances.  They not having a single clue that the very person who had them reassigned was me.

I have to pacify, explain managements decision was for their benefit of future promotions to be area managers, I have to come up with several valid reasoning to show them that their job movement was for their benefit in the long run.

And those that complaint the most, gets my attention and after the investigation was over in 3 months, I found out that those who have shown grievance over their area reassignment were involved in a unilateral intent to defraud the company of stocks, even cash from the coffer of their store sales.

After going through all the due process that I have requested HR to conduct, and the admittance of three of the co-conspirators to defraud the company and pinpointing each and every store managers and cashiers involved, the company filed criminal charges against the accused, for which summing it up, in 4 years, we had been defrauded of over 5 million pesos, in inventory pilferage and cash pilferage.

So bottom line, the saying that its always an insider most often holds true, and to be complacent and too trusting in delegating tasks does not mean well at times.  Though this experience and instance may be a case-in study for us, I have to make new changes in merchandising, inventory management policies within the company to avoid the same from happening.  I also have to institute new policies on rewarding best employees, honest staffs, gave a lot of "carrot on stick" benefits to operational staffs and management.