What are the 'Four Ps'
The four Ps are the categories that are involved in the marketing of a good or service, and they include product, price, place and promotion. Often referred to as the marketing mix, the four Ps are constrained by internal and external factors in the overall business environment, and they interact significantly with one another.
BREAKING DOWN 'Four Ps'The marketing mix and the four Ps were popularized in the 1950s by Neil Borden. Before the advent of the internet and greater integration between businesses and consumers, the marketing mix helped companies take into account the physical barriers that prevented widespread adoption of a product. Extensions of the Ps include "people, "process" and "physical evidence" as important components of marketing a product.
Product refers to a good or service being offered by a company. Ideally, a product should meet a certain consumer demand, or it should be so compelling that consumers believe they need it. To be successful, marketers should understand the life cycle of a product, and business executives should have a plan for dealing with products at every stage of their life cycles. The type of product also partially dictates how much businesses can charge for it, where they should place it, and how they should promote it.
Price is the cost consumers pay for a product. Marketers must link the price to the real and perceived value of the product, but they also must take into account supply costs, seasonal discounts, and prices used by competitors. In some cases, business executives may manipulate a price to make a product seem more like a luxury, or they may lower a price so that more consumers can try the product.
Place decisions outline where the product is sold and how it is delivered to the market. The goal of business executives is to get their products in front of the consumers who are most likely to buy them. In some cases, this may refer to placing a product in certain stores, but it also refers to the placement of the product on a store's display or where a product is showcased on a web page. In some cases, placement may refer to the act of placing a product on TV shows, films or blogs in order to garner attention for the product, but this type of placement overlaps with promotion.
Promotion includes advertising, public relations and promotional strategy. This ties into the other three Ps of the marketing mix, as promoting a product shows consumers why they need it and why they should be willing to pay a certain price for it. In addition, marketers tend to tie promotion and placement elements together so they can reach their core audiences.