The P's of Business
What is it ?
What now!? 7P. We've all heard of the 4Ps, haven't we? Some may not, but don't freak out, it's nothing too complicated. Generally speaking, the 'marketing mix' is the key foundation on which most modern marketing strategies and business activities are based. Now why is it so important for businesses to rely on it? Well, because it consists of all the elements that they need to plan on in order to success in their work fast and efficiently by choosing the right paths. It's crucial to plan out your business to understand your own business better to compete with others in the market for survival.
What is 7P vs 4P ?
Devised by E. Jerome McCarthy, the 7P, also known as the extended marketing mix, is the combination of seven elements of marketing that aim to work together to achieve the objectives of a marketing strategy. Is it related to 4P? YES. Now, you'll notice that why 7P is called the extended marketing mix. Because it is the extended version of 4P. Let's see the 4P below.
What you see above is the very first model of marketing mix. Later, due to the increasing requirements of customers, marketers and products, three more P's paved their way in by the modern academics and updated to 7P. The 7P's added components are Physical Evidence, People and Processes. Let's see the total 7P elements.
Now that we know what all the components of the 7P, let's go a little deeper into each component.
Components of '7P'
1. Product
The very first thing to think of when starting a business is what you are going to sell. What is your product? What is your service? How is it better than others' in the market? Who is your customer? Why they need the product? This section is all based on your goods/services. It can be about their usage, quality, label, packaging and etc.
Example: Is your data safe from viruses? Are you scared of losing data by ransomwares? Kaspersky is here to save your day from all those nasty viruses. Protect your data on all your devices. We have many plans available suitable for personal and company use. As you can see, this is the antivirus company that sells products and services for their customers to be safe from online thieves. The software is great with detailed reports and easy to use UI, without any ads or useless features. Kaspersky is available on both PCs and mobiles/tablets on many OS. That's why this software is preferred and well-known among official antivirus users.
2. Price
Everything comes at a price and so does your product. The second component is where you think of the suitable prices for profits based on the product's cost, market and targeted customers. The price is set in a way that profits you, while also attracts customers in.
Example: Xiaomi products are priced as low for budget users while packing with full features that is more than needed for daily use. This is what has drawn customers around the world to Xiaomi and made it the highest ranking brand for smartphone in 2021. A very good example is India where most are using Xiaomi.
3. Place
This component is where you choose the platforms to distribute your product. It includes everything from storing to selling the products to customers, which may refer to warehouses, stores, e-commerce shop or cloud-based platform. You have to study thoroughly to find the best placement for your product where you can profit more than cost.
Example: Clothing stores in Robinson department store normally has to be done physically, so that customers can try them on. Nowadays, due to the COVID-19 pandemic the stores have to shift to online based like livestreaming on Facebook and taking orders on Line.
4. Promotion
It's all about promoting, pushing , spreading your products at full potential to make customers know about your products and make them feel interested, while also targeting at specific customers that will be using our products. You wan your products to reach a maximum number of people either by using a paid campaign or by media channels. There are many ways to promote your products, which you can refer to the 'promotional mix'. Mostly are seen online in the form of ads and sales promotion.
Example: Mazda cars are advertised in many ways in many platforms depending on the targets. You can see the ads in Facebook, Line, Instagram, YouTube and other platforms either as photos or videos showcasing the features while also telling about the sales promotion available depending on the type of platforms.
5. People
Doing business consists of people running it. This is where you discover among the vast business category that who are your business people and how many of them are investors. Everything counts, from recruiting employees, management of employees for customer service to the skills employees should have when the unexpected happens. Employees must be able to deal with angry customers because if they are not willing to serve, customers may widespread the negativity. It is relevant for employees to have good physical & mental health and efficiency, thus affecting the business a lot, both directly and indirectly.
Example: AIS call center has employees talking with customers all day. They are always servicing numerous customers, either when they are asking for advices or complaining about services. The employees have to be patient at all times when talking or explaining things to customers. Employees are chosen by their speaking and listening skills. Later, they are trained so that they can properly handle various situations with customers.
The important ingredient that plans your whole business to guide you through the a series of actions that has to be taken in delivering the product or service to the customer in the right manner. In short, WHO, WHAT, WHERE, WHEN, WHY, and HOW or METHODS of the whole business to minimize the cost and maximize profits, while maintaining the quality of the product or service. Starting from the purchase of raw goods to the future plans of growth, everything is done in a process with proper methods used.
Example: Makro has done all their work in the right manner through proper methods as a process. When you go shopping, you can see that everything is sorted in each aisle according to their categories. Employees are also sorted to be in charge of each department where they have to check stocks, plan & place orders, arrange the aisle, learn customers' needs and buying behavior and etc. This is all that makes the firm run smoothly and make progress.
7. Physical Evidence
One of the crucial part of business is having an actual, physical place and the evidence that trades do take place here. It's still usual to have actual shops these days where customers go in and choose their products by using all their 5 senses either by seeing, smelling, hearing, touching or tasting and pay for it at the counter. Nowadays it's decreasing due to the COVID-19 pandemic where people switch to online-based stores instead. I don't know about the future, but personally I think that almost every business will go online or at least has an online store along with an actual one where the actual one may be used only to store goods. Physical Evidence is the confirmation of the existence of your brand and the evidence that a service or purchase took place. It is mainly about building trust among the customers by great website, office building, staffs and etc.
Example: Apple stores are designed in a wide and minimalistic way that provides free space for the customers both physically and mentally. Decorated with some arts and trees, it gives you a sense of comfort in a way that your money goes out of pocket freely without you feeling concerned about the amount that drained down your card or wallet. SERIOUSLY! I'm not complaining, I'm praising. While the place looks very comforting, staffs are also very nice in giving details and showcasing their products. Their products are also there for you to try and test the functions to find out what is suitable for your needs.
SUMMARY
Starting a business? 👉 Study 7P. Follow 7P. Succeed.
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