UNIT 13 P market

4 P rule Product, Price, Place Promotion

PRODUCT – the physical features of the product, or the intangible aspects of the servicecovers things you do to make the product more attractive

PLACE: decisions about where to sell the product;

- or concerns about where the customers are, and how to get to them;

- also includes the "channel of distribution"

- meaning, all the different middlemen you use to get the product out to the customer

PRICE
- are you going to sell at a high price and make a lot of profit in the short term;

- are you going to sell at a low price to beat the competition and stay in the long term

Promotion:

The specification of five elements creates a promotional mix or promotional plan. These elements are personal selling, advertising, sales promotion, direct marketing, and publicity. A promotional mix specifies how much attention to pay to each of the five subcategories, and how much money to budget for each. A promotional plan can have a wide range of objectives, including: sales increases, new product acceptance, creation of brand equity, positioning, competitive retaliations, or creation of a corporate image. There are three basic objectives of promotion. These are:

1. To present information to consumers as well as others.

2. To increase demand.

3. To differentiate a product.

There are different ways to promote a product in different areas of media. Promoters use internet advertisement, special events, endorsements, and newspapers to advertise their product. Many times with the purchase of a product there is an incentive like discounts, free items, or a contest. This is to increase the sales of a given product.

There are seven main aspects of a promotional mix. These are:

§ Advertising - Presentation and promotion of ideas, goods, or services by an identified sponsor. Examples: Print ads, radio, television, billboard, direct mail, brochures and catalogs, signs, in-store displays, posters, motion pictures, Web pages, banner ads, and emails.

§ Personal selling - A process of helping and persuading one or more prospects to purchase a good or service or to act on any idea through the use of an oral presentation. Examples: Sales presentations, sales meetings, sales training and incentive programs for intermediary salespeople, samples, and telemarketing. Can be face-to-face or via telephone.

§ Sales promotion - Media and non-media marketing communication are employed for a pre-determined, limited time to increase consumer demand, stimulate market demand or improve product availability. Examples: Coupons, sweepstakes, contests, product samples, rebates, tie-ins, self-liquidating premiums, trade shows, trade-ins, and exhibitions.

§ Public relations - Paid intimate stimulation of supply for a product, service, or business unit by planting significant news about it or a favorable presentation of it in the media. Examples: Newspaper and magazine articles/reports, TVs and radio presentations, charitable contributions, speeches, issue advertising, and seminars.

§ Corporate image - The Image of an organization is a crucial point in marketing. If the reputation of a company is bad, consumers are less willing to buy a product from this company as they would have been, if the company had a good image.

§ Direct Marketing is often listed as a the fifth part of the marketing mix

P rule

The 5 P's Model from Dr. Mildred Golden Pryor, J. Chris White, and Dr. Leslie A. Toombs is a Strategic Management Model which requires the alignment of 5 variables to improve organizations and their operations: Purpose, Principles, Processes, People, and Performance.

Purpose involves all the elements that constitute the intention of the organization. This includes the organization's mission, vision, goals and objectives, and strategies.

Principles are the guiding philosophies, assumptions, or attitudes about how the organization should operate and how it should conduct its business. This variable includes the integrity base, ethics, and core values to which employees are expected to make a commitment when they are hired

Processes are the organizational structures, systems, and procedures that are used to make the products or perform the services that the organization provides, as well as the infrastructure and rules that support these systems and procedures.

People are the individuals (and teams of people) who perform work that is consistent with the Principles and Processes of an organization to achieve its purpose. They are the active components who accomplish work results.

Performance encompasses all the metrics, measurements, and expected results that indicate the status of the organization, and are used as criteria for decision making. Performance results are fed back into the strategic management process to provide a means of feedback and control.

Origin of the 5 P's Model. History

The 5 P's Model was developed by Pryor, Toombs “Strategic Quality Management” The originators of the 5 P's Model studied under Dr. W. Edwards Deming, Dr. Joseph Juran, Dr. Peter Senge.

The following steps are a simplified description:

For PURPOSE:

• Identify strengths and weaknesses, threats and opportunities, mission, vision, goals and objectives, and strategies.
• Identify core leadership competencies.

For PRINCIPLES:

• use a team to develop core values.

For PROCESSES:

· List all processes.

· Document the processes using flowcharts, process maps and/or checklists.

· List process owners. If owners are not identified, designate process owners who will do the process documentation and improvement.

For PEOPLE:

· Determine the extent to which people are empowered, teams are in place.

· What is the level of self direction in teams.

· What training is needed.

· Other things that relate to employees.

For PERFORMANCE:

· Identify what measurements are in place/should be in place

· Establish key performance indicators (KPI's) and baselines.

· Set up a metrics system with targets for improvement.

· Track KPI's over time.

Strengths of the 5 P's Model. Benefits

- The 5 P's Model can be used at the corporate level and throughout every level of the organization.

- The 5 P's Model is applicable to all types and sizes of organizations.

- The 5 P's Model can be applied along with a variety of other leadership and management theories, concepts, and tools.

- The 5 P's Model is timeless. It will not become "out of date" just because other theories are introduced.

Limitations of the 5 P's Model. Disadvantages

People applying the 5 P's Model need to individually or as a team understand not only basic leadership and management concepts, but also strategic management, organizational development, process management, and systems thinking.