In the last part of our series, we will dealt with : The Marketing Mix - Getting it right
Let us now begin with the Elements of the Mix:
The First of the 7Ps is the product itself or in the service you have on offer. A business has to have a reason for existence and the products have to be relevant to its target market. Some people go into business because someone else appears to be making money from it. Or maybe because it is just the reigning business nowadays. I remember the era of the business center when everyone, big and small, opened up a business center. Nothing wrong with that really but a key element of being market led is that it must be relevant and different. It must be relevant to such a significant number of people that the sales you make will cover your costs and give you a pay back. There is no such thing as everybody being your target. Think about it. If you kept 6 bars of soap, same color, same shape same size on a table and asked someone to pick one, he could pick anyone. They are all the same.
Now, suppose one bars was to be scented and then well wrapped in an attractive packaging. It is very likely that the person may feel attracted to the scented one because now, he sees a difference and some value in the scented and package done. You could then take it further by giving one bar a rose perfumed smell with pink packaging and another a musky smell with a darker packaging. One person may prefer the rose smelling bar while another may prefer the musky scented one. Different people would choose different bars depending on their way of life and how much value they perceive that bar would add to their lives.
This is similar to the market place. You have to be different to be noticed. If you threw in a bar that is black in color with sand grits in it, that may be perfectly fine also but the question to ask is ‘does anyone want a soap with grits in it? Perhaps no one! This goes to underlie the very important need to first understand what the market wants before you go investing money in setting up shop. Businesses do better when owners have a clear idea of the kind of person they are selling to, what this person likes and how this person prefers to get it. Even the garri seller has come to understand that his market is not linear.
Some people do not like to go into the open markets to buy their garri so there is now an opportunity to neatly pack garri in various sizes of plastic bags and placing them in supermarkets for the convenience of such customers. This has not removed from the fact that people still go into the open markets to buy garri, but the reality is that there are those who are willing to pay more for having that garri brought to their comfort. That is customer insight.
Similar to the product, a good understanding of the people you want to reach as well as what competition is doing will determine how you price. Pricing can be used to great advantage in a variety of ways. Usually, when your product or service is sufficiently differentiated from your competition, you would be able to command a higher price. Such differentiation comes about from having invested in having your product name known or perhaps your product is so unique that no one else has been able to copy it.
Introducing something new to the market place i.e. innovation will enable you charge higher, at least for a while until competition catches up. You can use pricing as an incentive by giving credit to your customers or splitting payment over a period of time for their convenience. Fashion boutiques have found that the proliferation of so many boutiques means they need to work a little harder in giving incentives to their customers. The idea is to continue to monitor your business and the market environment and pull whichever pricing lever works for the situation.
I was convinced recently to buy a copy of a fashion magazine which I really did not want at that time but because the vendor offered me an interesting copy of a past edition of Forbes Magazine, he made a sale from me. I wanted the Forbes magazine and was quite willing to pay for the Fashion magazine if that was what it would take. To me the transaction has delivered value.
In a highly competitive environment, some businesses make the mistake of attempting to use the element of being the lowest priced player to differentiate themselves. While that may work for certain situations, it could also quickly get very nasty when a pricing war ensues. Everybody ends of losing including the customer. In the next part of our series, we will look at the other elements of the mix. In the meantime, keep well and stay ahead.
In the next part of our series, we will look at other Elements of the Mix. In the meantime, keep well and stay ahead.