CONCEPT AND COMPONENTS OF

MARKETING MIX
 Marketing Mix
Marketing Mix is the set of controllable variables that the
firm can use to influence the buyer’s response”. “The
controllable variables in this context refer to the 4 ‘P’s.
Each firm strives to build up such a composition of 4‘P’s,
which can create highest level of consumer satisfaction and
at the same time meet its organizational objectives. Thus,
this mix is assembled keeping in mind the needs of target
customers, and it varies from one organization to another
depending upon its available resources and marketing
objectives.
 Marketing Mix
“The marketing mix definition is
simple. It is about putting the right
product or a combination thereof in
the place, at the right time, and at
the right price.”
 Product
Product refers to the goods and
services offered by the organization.
Product can also take the form of a
service like an air travel,
telecommunication, etc. Thus, the term
product refers to goods and services
offered by the organization for sale.”
 Use

Product Durability

Classification
Tangibility
 Consumer Goods
Goods meant for personal
consumption by the households or
ultimate consumers are called
consumer goods. This includes items
like toiletries, groceries, clothes etc.
 Consumer Goods
Convenience
Shopping Goods Specialty Goods
Goods

bought frequently without These are goods which are Because of some special
much planning or shopping purchased less frequently characteristics of certain
effort and are also and are used very slowly categories of goods people
consumed quickly. Buying like clothes, shoes, generally put special efforts
decision in case of these household appliances. In to buy them. They are
goods does not involve much case of these goods, ready to buy these goods at
pre-planning. Such goods consumers make choice of prices at which they are
are usually sold at a product considering its offered and put in extra
convenient retail outlets. suitability, price, style, time to locate the seller to
quality and products of make the purchase.
competitors and substitutes,
if any.
 Industrial Goods
Goods intended for consumption or use as
inputs in the manufacture of other products or
the supply of some service are called 'industrial
goods. These are meant for non-personal and
commercial use and include (i) raw materials,
(ii) machinery, (iii) components, and (iv)
operating supplies (such as lubricants,
stationery etc.).
 Durability
Durable Non-Durable

Durable goods are Non-durable goods are

products which are used products that are
for a long period i.e., for normally consumed in
months or years together. one go or last for a few
Examples of such goods uses.” Examples of such
are refrigerator, car, products are soap, salt,
washing machine etc. pickles, sauce etc.”
 Tangibility
Tangible Intangible
Most goods, whether these are
consumer goods or industrial goods Services are essentially
and whether these are durable or intangible activities which
non-durable, fall in this category provide want or need
as they have a physical form, that satisfaction.
can be touched and seen.
 Price
The price is the amount paid in respect of a
good or service. It is the second most
significant marketing mix item. Pricing is a
very crucial field of decision because it affects
the demand for the product as well as the
company's profitability.
 Factors Affecting Pricing Decisions
Cost Demand Competition

The retail prices are If the availability of a The price charged by the
calculated in large product is insufficient and competitor for similar
quantities of goods by the demand is high, people product is an important
applying an appropriate buy, even if the producer determinant of price. A
profit margin to the costs. charges high prices. But marketeer would not like to
Higher the rate, the higher how high the price will be charge a price higher than
the price is likely to be, the depends on the ability and the competitor for fear of
lower the price is likely to willingness of prospective losing customers.
be. customers to pay, and their
desire for the product.
Factors Affecting Pricing Decisions
Marketing Government
Objectives Regulations
A firm may have different Prices of some essential
marketing objectives such as products are regulated
maximization of profit, by the government under
maximization of sales, bigger the Essential
market share, survival in the Commodities Act.
market and so on. The prices
have to be determined
accordingly.
 PLace
These must be made available to customers
at a location where they can make
transactions conveniently. The company has to
determine whether to sell to the retailer
directly or through the distributors /
wholesaler, etc. It might also plan on selling it
directly to customers.
 Channels of Distribution
The manufacturer must ensure the availability of his goods to
the consumers at convenient points for their purchase. He
may do so directly or, as stated earlier, through a chain of
middlemen like distributors, wholesalers, and retailers. The
path or route adopted by him for the purpose is known as
channel of distribution. A channel of distribution thus, refers
to the pathway used by the manufacturer for transfer of the
ownership of goods and its physical transfer to the consumers
and the user/buyers (industrial buyers).” Kotler, (2010).
 Functions
(a) It helps in establishing a regular contact with the
customers and provides them the necessary information
relating to the goods.
(b) It provides the facility for inspection of goods by the
consumers at convenient points to make their choice.
(c) It facilitates the transfer of ownership as well as the
delivery of goods.
(d) It helps in financing by giving credit facility.
(e) It assists the provision of after sales services, if necessary.
It assumes all risks connected with the carrying out the
distribution function.
Types of Channel
Distribution
Zero Stage
Zero stage distribution channel
exists where there is direct sale
of goods by the producer to
the consumer. This direct
contact with the consumer can
be made through door to door
salesmen, own retail outlets or
even through direct mail.
One Stage
In this case, there is one middleman
i.e., the retailer. The manufacturers sell
their goods to retailers who in turn sell
it to the consumers. This type of
distribution channel is preferred by
manufacturers of consumer durables
where individual purchase involves large
amount.”
Two Stage
In this case, there are two middlemen
used, namely, wholesaler and retailer.
This is applicable to products where
markets are spread over a large area,
value of individual purchase is small,
and the frequency of purchase is high
Three Stage
When the number of wholesalers used is
large and they are scattered throughout the
country, the manufacturers often use the
services of mercantile agents who act as a
link between the producer and the
wholesaler. They are also known as
distributors
Factors Affecting Choice of Distribution Channel
Nature of Nature of
Market Product
Say for example, where the In case the product is of
number of buyers is limited, technical nature involving
they are concentrated at few a good amount of pre-
locations and their individual sale and after sale
purchases are large as is the services, the sale is
case with industrial buyers, generally done through
direct sale may be the most retailers without involving
preferred choice the wholesalers.
Factors Affecting Choice of Distribution Channel
Nature of Middlemen
Company Consideration
A firm having enough financial If right kind of middlemen
resources can afford to its own having the necessary experience,
a distribution force and retail contacts, financial strength, and
outlet, both. But most business integrity are available, their use
firms prefer not to create their is preferred as they can ensure
own distribution channel and success of newly introduced
concentrate on manufacturing. products.
 Promotion
refers to a process of educating, persuading and motivating a
customer to select the product to be purchased. Promotion is
achieved by means of promotion of personal sales,
advertisement, publicity, and marketing. It is done primarily
with a view to providing knowledge about the quality,
characteristics and uses of a commodity to prospective
consumers. It stimulates the interest of potential buyers in the
product, compares it with the product of the competitors and
makes its decision.
 Objectives
– arouse his interest in the product;
– inform him about its availability; and
– inform him as to how is it different from others.
 Advertising
most used tool for informing the present
and prospective consumers about the
product, its quality, features, availability,
etc. It is a paid form of non-personal
communication through different media
about a product, idea, a service or an
organization by an identified sponsor.
 Publicity
This is a non-paid process of generating
wide range of communication to contribute
a favorable attitude towards the product
and the organization. The other tools of
publicity are press conference, publication,
and news in the electronic media etc.
 Personal Selling
It is a direct presentation to consumers or
prospective purchasers of the product. It
refers to the use of salespeople to persuade
consumers to act favorably and purchase
the product. In the case of industrial goods,
it is most effective promotional tool.
 Sales Promotion
It applies to short-term and temporary
opportunities to purchase new products or
to promote trials. The tool includes
competitions, games, gifts, trade shows,
discounts, and so on. Sometimes,
promotional advertising events are
conducted at retail level.
 People
The team involved in the delivery of the project
should possess the skills and qualities needed to
ensure its success (barring unforeseen mishaps).
This is perhaps especially true of customer-
facing staff, whose communication and behavior
will greatly impact the audience’s perception of
the brand. You could well have developed the
best product of its kind
 People Who
Make the
Products People Who
Bring the

Importance of
Products to the
Customers

People People Who

Talk to the
Customers
 Processes
The processes involved in a product’s delivery will
significantly affect the customer’s experience,
level of satisfaction, and lifetime value to your
business.
 Physical Evidence
The final P refers to the physical context and
paraphernalia (such as receipts, “thanks for
ordering” cards, confirmation emails and PDF
invoices) that come along with the product. In order
to reinforce the product’s and the seller’s credibility,
these components should exhibit the qualities
customers expect of them, based on up-to-date
industry standards.