Did you know, it costs about 4 to 10 times more to attain a new customer than it does to retain a new customer? Not to mention, customers regularly spend more per visit and are more likely to sign-up for upgraded services. If you’re looking to earn true customer loyalty; the kind that translates into recommendations, referrals, and profits, you need to understand the power of the 4P’s of marketing.
Creating Value For Your Customers
Over the years, research has shown that customer loyalty programs can effectively improve retention in the long run. Although there are many variables at play, a business can easily increase the probability of success by creating an effective and consistent strategy for customer satisfaction. A marketing mix is a collection of four elements that outline the strategy for how a business intends to reach its customers. These four elements help in retention and ensure that your most valuable customers are not taken by your competitors.
Product
The products your brand chooses to offer includes the tangible items or intangible service that will be used to fulfill the customers’ needs and demands. The features of a product, its physical form, packaging, warranties, and even after sales service are all included under the product strategy.
Place
Place includes how a business intends to get products from the location they are produced to where they can ultimately be consumed by consumers. The place is often referred to as distribution since we’re dealing with logistics. However, the place not only includes the physical distribution of the product, but also the channel through which it will be sold.
Promotion
Promotion involves establishing the most effective method for communicating with customers about various products that a business sells. Promotion is primarily meant to communicate, inform as well as persuade. An effective the promotion strategy like the other marketing mix elements will depend upon the business’s knowledge of its target customer. This knowledge allows a business to select the best way to communicate with its core audience and ultimately increase the success of its communications through social media and online marketing.
Price
The last element of the marketing mix is the price. Price is the easiest marketing mix element to alter from a technical sense. However, it is the most difficult thing to change. The reason is that altering the price of a product affects what consumers pay for that product and a business can only charge as much as the market is willing to pay. Technically, a business can charge whatever price it wants, but that doesn’t mean that consumers have to pay that price.
The way companies price their products can send a message to consumers. For example, many believe that maintaining low prices is the best method to attract and retain consumers. Although this can be an effective pricing strategy for specific items, it can also confuse consumers. Dealing with the psychological aspect of pricing, consumers tend to view less expensive items as having poor quality, compared to their more expensive counterparts. Although this doesn’t always hold to be true, businesses are very aware of the impact that price can have on the perceptions of its customers.
The important thing for a business to do with regards to the marketing mix is to be consistent. Each element should complement the other and communicate a consistent, unified message about the brand. Advertising a product is high-end but selling it through a discount retailer can ultimately hurt a brand and jeopardize sales.