Since Jerome McCarthy laid out the Four P’s in 1962, we've been able to take for granted that a successful marketing strategy can be built on four elements: Product, Price, Place, and Promotion; it’s a formula that has stood the test of time and the marketplace. But in a rapidly evolving, digital marketplace do the Four P’s hold up?
Not according to Rasmus Hansen, Strategic Director of London-based brand consulting agency Venturethree. In a Fast Company article earlier this year, Hansen wrote that “a closer look at some of today’s fastest-growing brands shows that time has buried the Four P’s. Companies can no longer use them to gain a competitive advantage and meaningful differentiation. In fact, they more and more look like a roadmap to failure.”
But is it really that simple?
At last month’s Association of Nation Advertisers Masters of Marketing Conference, I had the opportunity to learn and connect with industry leaders who have built and managed brands through digital media and have used analytics successfully to improve their positioning. That said, what stands out most in my mind from the conference is the fact that the presentations from top-tier companies like Microsoft, Target, and General Mills seemed to boil down to the application of classical marketing theories, including the Four P’s, to the rapidly evolving digital world.
As our digital environment evolves, what we’re seeing is a reformulation of the Four P’s: it’s not about four equal P’s, but rather, one large P (Product) and three smaller P’s (Price, Place, and Promotion).
Rethinking the P’s
Rasmus Hansen was correct to emphasize product excellence. Describing Google’s decision not to launch an aggressive marketing campaign early in its history, he said, “Google didn’t need marketing; the search engine was so good that it spoke for itself. Few companies are lucky to have such a powerful product.”
But Hansen was not entirely correct when he added, “The essential rationale is the same for everyone: A penny spent on campaigns is a penny less spent on user value.” In today’s, dynamic and multidirectional marketing environment, consumers have direct feedback mechanisms they never had before – and this has empowered them to participate robustly in the development of products they truly want and need. Result, when brands listen: better products and greater, not less, user value.
In today’s marketplace, it’s no longer just about just getting a great place on the shelf at your local grocery or hardware store. But that doesn’t mean “Place” no longer matters. As Lisa Gevelber of Think With Google points out, marketers should still care about “where” because new tools like consumer search data can now inform brand positioning or new product development. Marketers can now create hyper-relevant messaging and deliver it with surgical precision to mobile consumers.
The P’s have changed, but they are as essential as ever. In this consumer-empowered, digitally transparent world, every consumer with a blog or a social media account is potentially a content creator or promotional partner for your brand. Consumers actively research and pursue the best products available, exchanging feedback with one another and amplifying messages about your brand, both good and bad, across multiple online channels. If you’re product isn’t up to par, people will know - but when you get it right, consumers will let you know they love your product through their digital channels as well.
Scott Cook, the founder and CEO of Inuit, probably put it best when he said, “A brand is no longer what we tell the consumer it is - it is what consumers tell one another other it is.” Savvy brand managers and marketers recognize the opportunity this represents. They embrace influential customers as promotional partners, and invest a significant part of their marketing budget into targeted influencer and social marketing campaigns designed to focus and amplify consumer feedback.