The concept of the marketing mix is one of the fundamental tenants of marketing. And is something that for many people is unfamiliar when we talk about it in this context. But very familiar when we begin to dive into the details of it. And that all of us as consumers had been marketed to. So, we're going to think on both sides as a consumer. What we've seen, what we like, what we dislike. But also think about it as the entrepreneur of what we could do, should do, or might do. And our objectives are one, to understand customer needs and wants. This is going to build some of the fundamental elements in thinking about developing a marketing plan. And we also want to think about something that's adaptive. Something that's timely. And something that's responsive to changes in the market. It all starts with understanding the customer. Who are the customers? What are their problems? And we can think about them in a variety of ways. What's a day in the life? What are their minimum and required desires? What's the willingness to pay? So those are some of the themes that we're going to be examining. When we look at marketing plans, if you're developing a full marketing plan, you want to have a good solid foundation, understanding the product. That's the first P, when we talk about the four Ps of marketing. You also want to think about promotion and advertising. Some people mistakenly think that marketing equals advertising. In practice advertising is a piece, a promotion which is a piece of marketing. So in that way we'll discuss advertising, but it is a small piece of the overall marketing puzzle. We're also going to talk about pricing. Pricing is a key element that we want to understand and examine as entrepreneurs. And the last P of placement is something we'll explore as well. What are the sales methods? How is it that we're going to place our product in the market? How are we going to distribute our product, or service. When we look at the Marketing Mix, in the first P, we're looking at the product. What's the brand? The features, the designs, the quality, the packaging, the warranty, the return policies. All the things that are related to the product in and of itself. There's the price. Not only the list price. But incentives and discounts, and wholesale, and retail, and online, and credit and payment. There's promotion. Not only advertising, but also PR. Also the sales force piece. Also other messaging. And then there's the place, the channels, the locations,. Inventory fulfillment, and other factors, as well. When we look at examples of what are the types of things that we want to consider, or describe with the product. The Flip Ultra Camcorder is a good example to evaluate, and you can see here, on the right-hand side, dozens of features. It's easy to use. It's pocket-sized. It has a three-second startup. It has two-hour video quality. It has four gigabytes of memory. The screen of two inches. It's fast. It's convenient. It connects with YouTube. It does this and that and the other. That's where we need our features. Very tangible, observable, measurable things for the most part. That describe the products specifically and what it's capabilities are. For price, pricing. Again is something we're going to examine in some detail. But when we look at price, we want to recognize a few key considerations. One is certainly what are your costs? What's it cost you not only in the product itself, not knowing the cost of goods sold. If you look at a pair of blue jeans, the denim may be a few dollars. The zipper may be a few cents. The labor may be a few dollars. But that's not the only cost incurred by the company. There is a facilities cost of where are these jeans manufactured. There is an equipment cost. Of the equipment that is needed to make the jeans. There is an inventorying cost, a warehousing cost, a distribution cost, a marketing cost. Marketing, one of the biggest costs may be larger than all the manufacturing related costs combined. So when you think about price point, you need to recognize what all of your costs are. Another consideration is competitor pricing. What are they charging? Why are they charging that? And should you charge less, the same, or more? In that context, don't necessarily be concerned about being the cheapest out there. What we often feel as consumers when we see something with a low price point is that it has lower quality. Now if you offer a similar feature set to competitors, perhaps you price yourself a little bit below them. If you don' t have the brand, and you don't have the reputation that they have. But be weary of being too cheap. Be weary of charging a lot less. Because what you may find it may work against you. It might be perceived as significantly worse than the competitor if the price is that much lower. We also want to think about the element of manufacturing a component, cause, for you now and in the future. We want to look at financial statements that are out there. We want to talk with experts and get their inputs as well on what costs are, and where they're going. So in summary, when we look at the marketing mix, there are four P's. We've highlighted two of them so far in the product, and the price. Next time we're going to take a deeper look into the final two elements of promotion and placement.
