The 4 Ps and 4 Cs of the Marketing Mix

When you approach a new marketing project, how do you most efficiently focus your efforts? How do you divide the task in front of you into manageable pieces?

Traditionally, marketing managers have reached to E. Jerome McCarthy’s ‘four Ps’ classification rule-of-thumb. Invented in 1960, the ‘four Ps’ break down the task of succeeding in the market into a ‘marketing mix’ of four separate ingredients — product, price, place, and promotion.

Like anything dating back 50 years, the ‘four Ps’ have been updated somewhat to reflect modern realities of business. Nowadays, it can be more useful to think of not just the ‘four Ps,’ but an equivalent ‘four Cs’ as well; the ‘four Cs’ being from your customer’s perspective. (There are also ‘four new Ps,’ oriented towards service businesses, which are outside the scope of this article, but you can read about that here).

The goal of the new ‘four Cs’ is to fit the general shift away from mass marketing — in which marketers treated consumers like a largely featureless mass — and towards niche marketing, which often appears closer to a one-on-one conversation.

Rather than using fairly vague demographic models and large-scale media buys to compensate for inaccuracy, niche marketing uses in-depth market research to pinpoint highly lucrative markets which haven’t yet been dominated by the competition. Of course, poorly done, this can lead to ‘drowning in data.’ As Chris Thomas of market research firm Playmr puts it (source), you don’t need ‘a mind-numbing 200-page report written in Powerpoint 2003 — you need a cost-effective, easy-to-read executive summary – often a video.’

Once you understand your market thoroughly, you can start moving down the ‘four Ps’ and their attendant ‘four Cs.’

Product & Consumer

Your product is the core of your marketing effort. It must be something desirable, and you must understand its relationship to the market. What makes it superior to — or at least different from — the competition?

At the same time, you have to consider the ‘first C’ — your consumer. It’s much more effective to find a market first, and then develop a product to fit. Study the needs and wants of your consumer, and fill them.

Product testing is a key part of the ‘first P,’ and an even more important part of the ‘first C.’ It’s vitally important to know not just what the product will do for the customer, but what the customer believes the product will do for them.

Price & Cost

Many marketers start out believing, incorrectly, that price is the main motivator driving a purchase. Partly this is due to economics classes which focus only on numerical quantities. The reality however is that attempting to compete on price is generally not a successful move.

Nevertheless an inappropriate price may cost your firm a great deal of money. This can happen both through lost sales (due to a too-high price) or through money ‘left on the table’ (due to a too-low price).

Much more important in this respect is the ‘second C,’ or the ‘total cost to satisfaction.’ This takes into account not simply the purchasing price, but also the entire cost of time spent to acquire the good or service, the cost of ownership, and even a ‘cost of conscience’ if purchasing the product is associated with feelings of guilt.

To understand the ‘second C,’ consider the example of a hamburger restaurant. Here the ‘total cost to satisfaction’ is — in addition to the cost of the hamburger — the cost of driving to the restaurant, the cost of conscience of eating ‘junk food,’ etc. (You can find more information on the difference between price and cost here).

One of the most powerful aspects of the ‘second C’ is it allows you to easily spot ways to increase the price while decreasing the overall ‘cost to satisfaction.’ Measures here may have little or no impact on your ‘bottom line’ but may have a tremendous effect on your product or service’s perceived value.

Promotion & Communication

Promotion is the tool that the market uses to inform the population about the product. In order for somebody to know they can get the product from a place for a price, they’ll have to have that product promoted to them in one way or another. Promotion exists in many forms, and it continues to evolve to this day.

Traditional promotional methods like advertising and giveaway products (such as these) are still effective. Niche marketing however often also uses the framework of a communication, a give and take, between buyer and seller. Viewing your advertising as a communication has significant benefits in terms of understanding your market, as well as in terms of increasing sales.

Communication is more than just billboards or direct mail; it includes all of the countless ways that a brand can touch a potential customer including viral marketing, PR of the brand, traditional advertising and more. Making your advertising interactive means you receive constant feedback from your customers, which will allow you to improve and stay ahead of the competition.

Place & Convenience

Place is where the customer meets the salesperson. This may be a retail establishment, the customer’s home or office (as with direct and Internet marketing), or some other area.

Viewing it through the ‘fourth C’ lens of convenience allows you to evaluate different possible places to buy. Where will your market find it most convenient? With some products, this will be a retail store. In other cases, the Internet or a catalogue may be more convenient for the customer.

Not all of those options existed when this model was first introduced. Back in the day, it would take ages for a catalogue to arrive and even longer to send off your order and to finally receive what you wanted. There weren’t huge stores that sold everything, and you didn’t have the same amount of options to help you to research and easily find the best price.

Conclusion

Ultimately the ‘four Ps’ and ‘four Cs’ are two sides of the same coin, one seen from the seller and the other seen from the buyer’s perspective. As a marketer you need to consider all viewpoints in order to maximise the possibility of success. While you must structure the product offer to serve your own interests, often you will find that looking at the deal from the customer’s perspective allows you to find the most effective solutions.