
MARKETING 7P
Effective marketing involves a comprehensive approach to various activities related to product promotion. It encompasses the development of product and service concepts and branding, target audience analysis, advertising, and distribution across all sales channels, staff training, business process management, and many other factors that affect the final result. To integrate all aspects of successful marketing, the 7P model was developed, allowing business owners to develop a reasoned promotion strategy without missing important aspects.
What are we discussing?
- Origins of the 7P Marketing Mix
- Components of the 7P in Marketing
- How to Use the 7P Model for Business Purposes?
- Examples of Applying the 7P in Marketing
- Conclusions
Origins of the 7P Marketing Mix
The term “marketing mix” was first discussed by Harvard University marketing professor James Culliton. In his 1948 article “Management of Marketing Costs”, Culliton compared marketers to mixers of ingredients. Shortly thereafter, Professor Neil Borden published a work on the early history of the marketing mix, in which he called himself a popularizer of the marketing mix concept.
The 7P concept is based on the slightly shorter 4P model proposed in 1960 by Edmund Jerome McCarthy. According to this theory, the mix of marketing “ingredients” consists of four components — product, price, promotion, and place of sale.
Since this model was primarily intended for goods trading, there was a need to develop a similar scheme for businesses involved in providing services. This was discussed at the first conference of the American Marketing Association dedicated to services marketing. Thus, in 1981, Booms and Bitner proposed the 7P model, which consists of the initial 4Ps and three additional factors — processes, people, and physical evidence.
“The term ‘marketing mix’ means a set of controlled elements or variables that a company uses to influence the needs of its target customers and satisfy them in the most effective and efficient way”. “Marketing mix”, Wikipedia
The classic 4P model, in its modern form, was proposed by Philip Kotler and Jerome McCarthy. It has many modifications, including the extended 8P version, in which the eighth factor is performance. We will consider the 7P marketing mix, which is concise and at the same time fully reflects all the elements necessary for promoting any product, regardless of the company’s field of activity.
Components of 7P in Marketing
Let’s first take a detailed look at each component of the classic 4P marketing complex.
Product
This can be a product (material product) or a service (intangible) along with all its characteristics. This can include quality and purpose, design, style, functions (for equipment) or composition (for food products), options, and additional benefits, warranties.
If customer needs change, demand increases or decreases, or new competitors appear in the market, it is necessary to work on improving quality, creating new products aimed at other segments of the target audience, and in some cases launching completely new projects, separate lines and categories of goods or services.
Differentiation from competitors can be achieved through loyalty programs, convenient location, bright advertising, excellent service, warranties, or vivid packaging. All this is closely related to the following list items.
Price
Reasoned pricing plays an important role as it not only affects the profitability of the company but also the consumer’s attitude towards the product, their decision to order and expectations from the product or service. The cost reflects the value of the commercial offer, so it is not advisable to engage in dumping even at the start of promotion, otherwise, you may be perceived incorrectly.
“This is the only element of the marketing complex that brings income — all other marketing activities are costs. Therefore, it is important to set the right price, so that it not only covers costs but also brings profit! Before setting a price, we need to research information on how much customers are willing to pay and understand the demand for this product/service in the market”. “Understanding The 7Ps of The Marketing Mix”, — Alicia Allen, lecturer, tutor and apprenticeship trainer for the Oxford College of Marketing
This item involves the development of pricing strategy and tactics, competitor analysis and price setting, planning discount systems (for example, for distributors and separately for customers), payment methods, forming payment terms, for example, the possibility of installment payments or arranging credit.
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Modern consumers have the opportunity to compare prices before making a purchase decision. For this, there are special online platforms. Before buying or ordering something, the user usually contacts several sellers and clarifies the cost, finds out what is included in the price, and draws conclusions. Thoroughly thought-out development of pricing strategies and their regular adjustment is important for a company that wants to enter the e-commerce market.
Place
The place, in other words, distribution, includes all online platforms and physical points used to make the product or service accessible to the target audience. This item relates to decisions related to distribution channels, retail locations, online platforms, presence on social media, and logistics.
Before making a decision regarding placement, it is also necessary to consider the specifics of inventory management, transportation, storage.
Given the convenience of searching for products on the internet, the place from the point of view of digital marketing is closely related to the next item — promotion.
Promotion
Marketers pay special attention to this aspect, as it includes advertising, sales promotion, PR, content marketing, and SMM, any channels and tools used to achieve business marketing goals.
As part of the work on promotion, it is necessary to develop a communication strategy with potential customers, choose channels for communication with the target audience, and determine the optimal frequency of messages.
If only traditional marketing was used at the time of the emergence of the 4P and 7P models, today digital tools are a priority. Pay-per-click (PPC) performance, search engine optimization results, the number and nature of reviews about the company, partnership opportunities and native advertising, the volume of the database for email newsletters, the number of subscribers on social networks and their activity, and much more are considered. This complicates the planning process for promotion while expanding opportunities for reaching and engaging customers.
In addition to these four initial elements, the 7P model includes three components added for universality and completeness of the concept. Primarily, the factors listed below relate to the B2B sector and the service market, but in some cases, they are very important for retail trade of goods as well.
People
Employees participate in business processes at every stage of product creation and its sale. The competence of the staff and the ability of specialists to communicate with customers affects the overall impression of the company, the desire to return to the store or organization, or, conversely, the motivation to leave a negative review.
At this level, it is also worth paying attention to the psychology of buyers, considering their needs and problems using surveys, questionnaires, interviews, and other methods of obtaining feedback.
For better interaction with customers, it is not enough to install an online chat or call-tracking service on the site. It is necessary to continuously train employees and improve their knowledge of the product and communication skills with consumers.
Processes
It is also important to consider all measures taken within the framework of the production, sale of goods, or provision of services. These include procedures used by the company to control quality, process orders, solve problems, etc. Processes are both external (communication of managers with customers) and internal (analytics, measurement of key performance indicators (KPI), preparation of job instructions for staff).
The level of consumer trust in the company and the reputation of the brand is the most important part of the processes is service, in particular, the speed of response to questions, promptness of order dispatch, after-sales service.
“One of the main ideas of a good buying system is considered to be speed. This is especially relevant when it comes to the transfer of goods chosen and ordered through the Internet. Keeping customers informed is an impressive style that improves customer experience”. “Marketing — Importance Of Marketing Mix 7ps”, — Stefan Scott
At this stage, understanding the scenario of using the website and the entire customer journey—from getting acquainted with the brand to repeat purchases—is very important. Trained staff and modern analytics and automation services allow improving positive customer experience.
Physical Evidence
For the goods market, this aspect was attributed to the first item “product”. However, even for retail trade, visual design has recently become so important that it can confidently be called an independent and sometimes even a defining factor. Everything tangible that can be seen, heard, or felt by touch or smell related to the product or service falls under physical evidence. This includes the design of product packaging, the interior and exterior of the establishment, the appearance of advertising materials, etc.
The environment in which the service is provided takes second place after the quality of the product, if we talk about a beauty salon, gym, or restaurant. A large number of consumers, when choosing between two similar establishments, prefer the one that not only satisfies the basic request but also provides aesthetic pleasure.
Equipment, furniture, music, menu design in a cafe or cosmetics catalog, spatial planning, absence of excess noise, sofas and mirrors in a shoe or clothing store, comfortable air temperature, branded souvenirs, gift packaging with a postcard—all this provides an opportunity to become one of the leaders in the competitive market. A bright example is the promotion of a store or specialist on Instagram, where the style of page design and photo quality affects the number of inquiries.
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For online business, physical evidence includes the design and usability of the web resource, in particular, a feedback form available on each page, the absence of unnecessary elements on the site.
“For an agency, valuable physical evidence is the website itself—from reviews to thematic studies, as well as contracts that are concluded with companies for the provision of services they can count on”. “What is 7P marketing? (Including benefits and example)”, Indeed Editorial Team
The number of P’s in your marketing strategy depends on the direction of activity and goals. The marketing mix most often includes 4P or 7P. For example, if you offer photography services, focus on the product and processes. For a gift box store, physical evidence (beautiful packaging, box components in a single color scheme, etc.) is important. A marketing agency, in addition to the product and processes, should focus on people and promotion.
How to Use the 7P Model for Business Purposes?
The 7P model should underpin the marketing strategy as it encompasses all areas of business development. With its help, an entrepreneur or marketer can achieve various goals:
- Develop a unique selling proposition by defining or creating a competitive advantage.
- Improve the product in line with trends and adapt to external conditions.
- Popularize the brand or promote a new trademark.
- Expand the customer base using various promotion methods.
- Increase sales, including through cross-selling, enhance the average customer spend and their lifecycle.
- Automate business processes, facilitate result monitoring, and save employee time.
“7P is a key component of marketing as it covers the fundamental principles of strong market positioning, especially against competitors and before recognizing customers. By addressing these seven elements, companies can attract and engage customers, motivate their sales, and increase revenue”. — “What is 7P marketing? (Including benefits and example)”, Indeed Editorial Team
Companies can use the 7P model to set goals, create a target audience profile, conduct SWOT analysis and competitive audits. It serves as a practical basis both for evaluating an existing business and for developing the concept of a new project.
To describe 7P marketing, companies should answer a series of questions:
- How can you improve your products or services? Perhaps there are hints in reviews, on forums, or on competitors’ websites.
- How can you change your pricing model, and what promotions would be relevant to consumers and profitable for the company?
- Where else can you promote, in which locations or on which online resources can you sell your product? Consider potential partners and brand advocates.
- How can you improve existing customer acquisition channels and utilize new ones?
- How do you create a WOW effect, or can you improve the first impression of the company? Perhaps it’s time to modernize the website or launch a landing page for a popular direction?
- Are all business processes streamlined, how quickly and accurately do customers receive feedback from employees, are all data recorded and used to improve KPIs? Do you conduct website audits?
- Are there gaps in employees’ skills, are they enhancing their qualifications, and is professional development supported by company motivation?
- Does the trading space, online or offline, meet the modern demands of the audience, does it attract attention?
If you already have a developed marketing mix, it’s worth periodically testing it “through the eyes of the consumer”. To do this, you can create a focus group or launch a series of surveys with questions like “What would you change about the product?”, “What do you like about the service, and what not?”, “Is the price acceptable to you?” etc.
When analyzing the marketing mix for your company, choose the Ps that are relevant to your business. For mass-market products, it might be sufficient to apply the classic 4P model. When describing the product in its current and ideal state, try to be as specific and precise as possible, using figures so you can later assess the work results.
The evaluation of the company and its product should be detailed considering the opinions of consumers and employees. Record the information and for easier perception, format it in a table. It’s important to set deadlines for planned actions based on the table and distribute the advertising budget accordingly.
7P | Goal | Fact | Indicator | How to Improve? | Priority or Deadline |
---|---|---|---|---|---|
Product | Target marketing mix values describing the ideal state of the product and service for maximizing profit.. | The actual state of the marketing mix as determined by the marketer. | 🙂 | A list of actions that allow achieving the target values of the marketing mix. | Sequence of actions (ordinal numbers or specific dates). |
Price | 😐 | ||||
Promotion | 😕 | ||||
Place | 😐 | ||||
People | 🙂 | ||||
Processes | 🙂 | ||||
Physical Evidence | 🙂 |
The “Fact” column represents your current state, point B. By implementing the actions described in the penultimate column, you can move towards point A, as defined in the “Goal” column. Priorities are set based on the indicator and the overall situation within the company. Using the table you create, you can develop a marketing strategy or simply formulate a plan to improve specific aspects of your business.
Examples of Applying 7P in Marketing
Continuously working to improve the marketing mix helps to develop weaknesses and strengthen advantages, increases competitiveness and adaptability, and allows for optimal organization of communication between employees and clients, as well as among different departments within the company if present.
To understand the essence of the table, whose template is presented above, let’s imagine how it might be filled out by the owner of a newly launched craft confectionery.
P | Goal | Fact | Indicator | How to Improve | Priority |
---|---|---|---|---|---|
Product | Unique cakes made in-house, as well as individual pastries and macarons. | In-house cakes, unique flavors, modern decorating techniques. | 🙂 | Expand the assortment. | 6 |
Price | $20/kg for cakes, $20-40 for pastries and macarons. | $20/kg. | 😐 | Expand the assortment, gradually raise the price, preparing regular customers in advance. | 5 |
Promotion | Targeted advertising on Instagram, business cards. | Targeted advertising on Instagram, contextual ads, participation in fairs, native advertising on social networks. | 😕 | Create a website for contextual advertising, communicate with local fair organizers, find 10 city micro-influencers. | 2 |
Place | Café-confectionery in the city center, website, and 2-3 social networks. | POS on the outskirts, Instagram page. | 😕 | Create a website, negotiate subleasing a space with other craftsmen of related products (bakeries, cafes). | 3 |
People | One person does all the work. | A helper and a marketer are available. | 😕 | Find two specialists for collaboration. | 4 |
Processes | Fast response, order fulfillment within 1-2 days. | Fast response, order fulfillment within 1-2 days. | 🙂 | Maintain speed of execution even as sales increase. | 7 |
Physical Evidence | The POS is not visually appealing. The social media page is unprofessionally designed, but the photos are high quality. | Branded design for the kiosk, and in the future, for the own confectionery. Professional social media content. | 😐 | Order a logo and brand book, create branded decor. Hire someone knowledgeable about Instagram visuals. | 1 |
Let’s consider a real example — the marketing mix of the international jewelry brand of Danish origin, Pandora.
Its main product is the famous bracelets with charms. The production uses precious and semi-precious stones, cultured pearls, amber, Murano glass, and alloys coated with 14-karat gold, including rose gold. The range has been expanding throughout the company’s history.
The products are not budget-friendly, but this does not deter the brand’s fans. In the catalog, you can find bracelets priced over $1,900. However, most of the range consists of items priced from $75 to $150.
The company utilizes all available platforms and channels for promotion. Over 9.5 million users follow the official Instagram page. At the same time, the brand’s marketers do not neglect the opportunity to increase the website’s conversion rate by using promotional offers.
Contextual advertising, targeting, and retargeting are employed. After visiting the website, you can encounter ads in the Instagram news feed and stories.
Pandora jewelry is sold in more than 100 countries worldwide. The number of sales points exceeds 7,800, of which more than 2,400 are concept stores. The locations of official representatives are easy to find on the map on the website.
The company employs more than 27,300 specialists, 13,200 of whom are in production in Thailand. The brand is open to commercial proposals, with office managers communicating with potential partners in each country. The customer care service and numerous communication methods on the website indicate well-established communication processes with customers.
The website’s elegant design and the luxurious yet understated interior decoration of the stores. The decor is associated with tenderness and femininity, and the use of the crown symbol in the logo enhances the feeling of customer privilege.
Frequently Asked Questions
7P in marketing is a set of factors that a company should consider when promoting its product. It provides a basis for making marketing decisions.
The marketing mix is a marketing tactic used to clearly position a commercial offer and meet customer needs. It includes 7Ps: product, price, place, promotion, people involved in the business, processes, and physical evidence.
An example of 7P marketing can be seen with the company HubSpot. It includes marketing, sales, service hubs, website management, and a free CRM system. The 7P components are as follows: a set of tools for SEO, blogging, social media, websites, email, and lead generation tools (product), a monthly subscription-based fee (price), online interaction, partner network (place), presentations by directors at events, useful guides, social media advertising (promotion), branding (physical evidence), the majority of the sales department staff involved in conversion (processes), investors and partnerships with major media companies, including Facebook and Google (people).
Conclusions
All business owners and marketers use the marketing mix, although not everyone realizes it. Not understanding the basic components of 7P can hinder the full use of a company’s potential, objectively identifying its weaknesses and strengths. In such cases, resources may be directed not at the aspects that are actually a priority.
The goal of the marketing mix is to develop an effective strategy for improving business metrics, enhancing the value of the product in the eyes of the target audience. If you have created a product, determined its positioning, and set goals, turn to the 7P model. It will help you formulate a tactic to implement the optimal action plan for your company.