What are the Four Ps
The four Ps are the categories 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
Neil Borden popularized the marketing mix and the four Ps in the 1950s. Before the internet and greater integration between businesses and consumers, the marketing mix helped companies account for the physical barriers that prevented widespread product adoption. Extensions of the Ps include people, process and physical evidence as important components of marketing a product.
The First P Stands for Product
Product refers to a good or service a company offers. Ideally, a product should meet a certain consumer demand or 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.
The Second P Stands for Price
Price is the cost consumers pay for a product. Marketers must link the price to the product's real and perceived value, but they also must consider supply costs, seasonal discounts and competitors' prices. In some cases, business executives may raise the price to make a product seem more like a luxury or lower it so more consumers can try the product.
The Third P Stands for Place
Place decisions outline where a company sells a product and how it delivers the product to the market. The goal of business executives is to get their products in front of consumers most likely to buy them. In some cases, this may refer to placing a product in certain stores, but it also refers to the product's placement on a store's display or where a product appears on a web page. In some cases, placement may refer to the act of placing a product on TV shows, films or blogs to garner attention for the product, but this placement overlaps with promotion.
The Fourth P Stands for 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 should pay a certain price for it. In addition, marketers tend to tie promotion and placement elements together so they can reach their core audiences.