Buying, selling, market research, transportation, storage, advertising - these are all a part of the complex area of business known as marketing. In simple terms, marketing means the movement of goods and services from manufacturer to customer in order to satisfy the customer and to achieve the company's objectives. Marketing can be divided into four main elements that are popularly known as the four Ps: product, price, placement, and promotion. Each one plays a vital role in the success or failure of the marketing operation.
The product element of marketing refers to the good or service that a company wants to sell. This often involves research and development (R&D) of a new product, research of the potential market, testing of the product to insure quality, and then introduction to the market.
A company next considers the price to charge for its product. There are three pricing options the company may take: above, with, or below the prices that its competitors are charging. For example, if the average price of a pair of women's leather shoes is $27, a company that charges $23 has priced below the market;
a company that charges $27 has priced with the market; and a company that charges $33 has priced above the market. Most companies price with the market and sell their goods or services for average prices established by major producers in the industry. The producers who establish these prices are known as price
leaders.
The third element of the marketing process - placement - involves getting the product to the customer. This takes place through the channels of distribution. A common channel of distribution is: manufacturer —> wholesaler —> retailer —> customer.
Wholesalers generally sell large quantities of a product to retailers, and retailers usually sell smaller quantities to customers.
Finally, communication about the product takes place between a buyer and a seller.
This communication between a buyer and a seller is known as promotion. There are two major ways promotion occurs: through personal selling, as in a department store; and through advertising, as in a newspaper or a magazine.
The four elements of marketing - product, price placement, and promotion - work together to develop a successful marketing operation that satisfies customers and achieves the company's objectives.
Exercise 1. Circle the letters of the answers that best complete the sentences below:
1. The four main elements of marketing are popularly known
as...
a.... the movement of goods and services.
b.... the fourPs.
c...the four Ms.
d.... buying, selling, market research, and storage.
2. The product element refers to...
a. … thefour Ps
b. … testingof a product to insure quality
c.... the good or service that a company wants to sell
d.... getting the product to the customer.
3. Most companies price...
a.... with the market.
b.... below the market.
c.... beyond the market.
d.... above the market.
4. The two major forms of promotion are...
a.... radio and television.
b.... personal selling and advertising.
c.... personal selling and newspapers.
d.... selling advertisements.
Exercise 2. Various problems that might occur in the marketing process are listed below. Determine to which of the four Ps each problem is most closely related. Mark the appropriate category of product, price, placement, or promotion with an X.
Product Price Placement Promotion
1. The advertising gives false information.
2. The product is dangerous.
3. The product is not available in enough stores.
4. The product is too expensive.
5. A salesclerk isrude to customers.
6. The product is sold during the wrong season.
7. The product is of poor quality.
8. The advertising is offensive.
9. The price of a product increases
faster than the rate of inflation.
10. The product is not available
in your favorite stores.
11. Additional problems:...
