MODULE 4 MANAGING MARKETING MIX

22.1 CONCEPT & COMPONENTS OF MARKETING MIX

Marketing Mix: Ideal vehicle for delivering customer value
The 4 Ps product, place, promotion & price constitute the marketing
mix of the firm. The marketing mix is the sole vehicle for creating &
delivering customer value. It can be easily seen that all activities &
programs, which a markete3r designs & carries out in his effort at
winning customers, relate to one or the other of the above 4 Ps. It can
also be seen that in each of these elements, there are several subelements. For ex, packaging is one of the sub-elements of product &
warehousing is one of the sub-elements of distribution (place).

Four Ps of Marketing
It was James Culliton, a noted marketing expert, who coined the
expression marketing mix & described the marketing manager as a
mixer of ingredients. To quote him, The marketing man is a decider &
an artist a mixer of ingredients, who, sometimes follows a recipe
developed by others & sometimes prepares his own recipe. And, sometimes
he adapts his recipe to the ingredients readily available & sometimes
invents some new ingredients, or, experiments with ingredients as none
has tried before. The dynamics of the marketing process & the
versatility of the marketing mix tool cannot be described any better.
It was Jerome McCarthy, the well-known American professor of
marketing, who first described the marketing mix in terms of the 4Ps.
He classified the marketing mix variables under 4 heads, each beginning
with the alphabet P:
Product
Place (referring to distribution)
Price AND
Promotion

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22.2 CONCEPT & COMPONENTS OF MARKETING MIX
MARKETING MIX/FOUR Ps OF MARKETING
PRODUCT
Product design, features, brand name, models, style, appearance.
Product quality.
Product warranty.
Product package: Design type, material, size, appearance & labeling.
Product service: Pre-sale & after-sale, service standards, service
charges.

PLACE
Channels of distribution: Channel design, types of intermediaries,
location of outlets, channel remuneration, dealer-principal relations
etc.,
Physical distribution: Transportation, warehousing, inventory levels,
order processing etc.,

PRICE
Pricing policies, margins, discounts & rebates.
Terms of delivery, payment terms, credit terms & installment
purchase facilities.
Resale price maintenance.

PROMOTION
Personal selling: Selling expertise, size of sales force & quality of
sales force.
Advertising: Media mix, vehicles & programs.
Sales promotion.
Publicity & public relations.

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22.3 CONCEPT & COMPONENTS OF MARKETING MIX
Environmental Variables of Marketing
Besides the marketing mix variables, the marketing manager
has to tackle another set of variables that lie outside the control
of the firm. These relate to the environment. Competition is
one variable in this set. The consumer is another. The
government of the land is yet another. Even the forces of
nature impact the marketing task. These & similar other
elements constitute the environmental variables of marketing.
While the marketing manager can choose, alter & control the marketing
mix variables, he cannot choose or alter the environmental variables
against which he markets his product. For ex, he cannot dictate what
the competitors should or should not do. This precisely why the
environmental variables are alternatively referred to as the noncontrollable variables of marketing, while the marketing mix variables
are referred to as the controllable variables of marketing.

Role of Marketing in Controllable & Non-Controllable Variables

Marketing can be basically looked upon as the interaction
between Marketing mix variables & Environmental variables.
Using the marketing mix variables, the marketing manager
tackles the environmental variables.
He intelligently selects & adjusts the marketing mix variables
& brings them in alignment with the environmental variables.
In fact, it is by choosing the marketing mix variables in
alignment with the environmental variables that the marketing
manager formulates his marketing strategy.

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22.4 CONCEPT & COMPONENTS OF MARKETING MIX
Marketing mix elements can be combined in an infinite # of ways
It is obvious that theoretically the marketing mix elements can be
combined in an infinite # of ways. In practice too, marketing managers
usually consider # of combinations & selects the best out of them.
Without considering several alternatives, the objective of optimization
cannot be realized.
The marketing mix elements are substitutable by one another to some
extent. This means that the marketing manager can take away resources
from one element & assign them to another & achieve his marketing
objective. It means that he can achieve his marketing objective, using
different combinations of marketing mix.

Selecting the optimum among the many possibilities

Depending on the objective & the context, relevant weightage has to be
assigned to each of the elements. Even within an element, weightages
have to be assigned to the various sub elements, depending on the
objective & context. To cite an example, within promotion, advertising
& brand-building endeavors will get a higher weightage, if the objective
is higher market share over the long-term; and personal selling & sales
promotion will get a higher weightage, if the objective is higher sales in
the immediate run.
Moreover, there are different possibilities even with regard to the sales
level. The sales level in itself is not a static or sacrosanct figure. One can
fix a higher or lower sales target & go about achieving it in a costeffective manner, achieving overall optimization in the process.
In other words, the marketing manager can work out different
combinations of sales levels & marketing mix spendings & choose the
optimum one, from the profit & other relevant angles.

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22.5 ASSEMBLING THE MARKETING MIX THE MAIN TASK IN MARKETING

Since marketing is essentially an interaction between the marketing mix

& the environmental variables & since the latter is non-controllable,
marketing becomes synonymous with assembling & managing the
marketing mix.
Of course, while assembling the marketing mix, the marketing manager
will take due note of the environmental variables. Not only will he take
due note of them, he will ensure that his marketing mix suits the
environmental variables. And, it is this factor that renders the task
much more complex.
It is by assembling & operating its marketing mix that a firm executes
its marketing strategy. Assembling the marketing mix involves # of
decisions relating to each of the marketing mix elements, the 4 Ps.

Decisions are also required on the linkage among the elements.

And all these decisions form an integral part of the marketing
strategy.
What is the best combination of the 4Ps in a given situation?
Which line of products or which individual products, should
be offered to an identified target market?
What should be the price structure?
Which channel has to be selected?
What is the right promotion strategy?
How should the total marketing effort & resources of the
firm be apportioned among the 4Ps?
How to balance the impact of an increase or decrease in the
allocations to a particular element on the other elements?

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22.6 ASSEMBLING THE MARKETING MIX
Selecting an ideal combination is the name of the game
The countless ways of combining the 4Ps vary from one another, in the
impact on the market & on costs. The name of the game is to select a
combination, which will have the desired impact on the market & will
also be cost-effective.
The task is basically one of giving correct weightage to the different
elements of the mix & ensuring that all the elements are integrated. In
fact, the effectiveness of any marketing program depends directly on the
extent to which the marketing mix is able to harmonize & synthesize the
different elements into a unified entity.

Marketing mix has to be juggled constantly

Assembling the marketing mix is a continuous task & not a one-shot
assignment. No marketing manager can assume that his job is over once
the marketing mix is assembled. The mix will require periodical
changes & in some cases, constant changes. In fact, there is no such
thing as a for-ever-valid marketing mix. The marketing manager has to
carefully monitor the conditions & keep juggling the mix.

Change in customer preference

In many businesses, the customer is, perhaps, the most fluctuating of all
the environmental variables. Often, customer tastes & preferences
change very fast; today, he may want a cheaper version of the market;
tomorrow, he may be bothered more about quality or after-sales
service. Brand loyalty also changes; customers purchasing power too
changes over time. The marketing manager is vitally concerned with
these changes relating to the customer. Through customer analysis &
MR, he has to gather the relevant information about the customer & the
changes taking place in his needs, tastes & preferences & respond to
them through appropriate modification of the marketing mix.

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22.7 CHANGES WITHIN THE FIRM
There is yet another reason why the marketing mix needs to be juggled
frequently. Besides the changes in the external environment, changes
taking place within the firm too, necessitate the modifications in the
marketing mix.
For ex, changes in the corporate/competitive strategy of the firm,
changes in the product lines of the firm, changes in the organization or
resource level of the firm, will lead to change in the marketing mix for a
given product/brand.
The marketing mix is neither a straitjacket nor a never-to-be altered
tool. Within a certain durable framework, the elements of the mix have
to be ingeniously juggled to accommodate the changes taking place
within the firm & in the relevant external environment.

Changes in environmental variables

In the first place, the environmental variables are constantly in a flux.
This reality compels the marketing manager to keep juggling the
marketing mix. Without doing so, he will not be in a position to respond
properly to the changes. Constant emphasis is placed on competition.
The competitors in any given industry will be making their tactical
maneuvers in market all the time. They will introduce a new product or
initiate an aggressive promotion campaign or announce a price
reduction. The competing firm has to meet all these maneuvers & take
care of the competitive position of his firm/brand in the market. The
only way the firm can achieve this is by adjusting the marketing mix.
Similar is the case with other major environmental variables like
economic conditions, government policies & climatic conditions. All of
them keep changing & the firm has to adjust the mix accordingly.