22/03/2013 The theory underline the 4 Ps model of the marketing mix model is that if a firm manages to achieve the

right product (satisfying customers need and requirements) at the right price (Justifiable cost to customer) in the right place (convenient to the customer) and with right promotion (proper communication or message to the customer), then the marketing program will be effective and successful. It has to be noted that the 4 Ps model of marketing mix may not be valid in all situations and certain company has found using some other additional variables in their marketing mix such as packaging, service, quality, penetration etc. in cases of certain companies, the promotion or advertising variable may not be important at all. For eg the companies that sell their products to original equipment manufacturers for the replacement market. However the 4Ps model is widely accepted by the marketers and possesses its own significance in a firms marketing effort. Benefits or Advantages of the Marketing Mix concept 1. It provides a valuable framework for allocating financial human resources: the company must determine with some precision as to which of the various ingredients available, is likely to provide maximum customer customers satisfaction on the one hand, and optimum response from the market place on the other. 2. It helps to allocate responsibilities: it is much easier to allocate responsibilities when the marketing manager understands fully the nature and scope of the main activity that need to be undertaken. For eg in a case of a domestic appliances company, the emphasis was based on 5 components: Product, Price, Place, Promotion, and Service. Service component was identified as a major element in a mix. Hence it was decided that service deserves a separate existence in the mix and should therefore be organized as a separate profit center, a separate unit responsible for guarantee a product for the warrantee period and thereafter for providing efficient maintenance and repair at a fee. In this particular company, it was understood by everyone that the quality of service rendered by the service unit could determine the difference between happy and unhappy customers. 3. It facilitates communication: a full understanding of the marketing mix can certainly provide a framework around which jobs can be allocated and their task or activities can be communicated to the world at large. Thus if one talks about Promotion Manager, it should be fairly clear to everybody outside and inside the firm that the sub-activities of this job involve Personal selling and publicity and public relations. 4. It helps in goal achievement: an effective marketing program plans all the marketing mix elements into a coordinated program that results in the achievement of companies marketing goals. The marketing mix constitutes the companys tactical-tool-kit for establishing strong positioning in the target markets. 5. It promotes customers satisfaction: each element or ingredients of the marketing mix may be design to deliver a special customer benefit which together will result in better customer satisfaction. For eg- product may be designed to cater to the needs and

requirements of the customers, price may be fixed in such a way that imposes minimum cost on the customers; physical distribution may be arranged in such a fashion that provides convenience to the customers; and promotion activities may be designed in such a manner that they properly and completely communicate the message of the firm to the consumer in the target market. All this makes a company a winning company because through a coordinated blank of marketing mix element, it will be in a position to meet customer needs economically convenient and with effective communication. 6. It provides an opportunity to analyze elasticity: resources allocated to marketing mix ingredients (alternatives) are designed to yield results. For eg- a company may seek to increase the level of awareness of its products and the level of interests among potential customers by increasing the advertising budget; and it may seek increase in sales by increasing by increasing the number of sales personnel. The most complicated task that every marketer has to struggle with is the decision concerning which of the various ingredients (alternatives) is likely to yield the best return. Is it better to increase the sales force or to increase the promotional budget? Alternatively, is a faster or more efficient distribution system likely to yield better results? The situation become more complex by the fact that the response to many of these expenditure areas is not linear ie doubling the sales force does not guarantee double sales. Because the law of diminishing returns sets in sooner or later. The perfect mix is based on detailed analysis of cost and revenue relationships and identification of the point at which increase in expenditure over an element does not pay because the extra net revenue does not cover the extra cost. This kind of analysis can be undertaken only in the context of a marketing program that has clearly identified the components which may be effective in stimulating marketing response.