Move Over 4P’s of Marketing, There’s a New “P” in Town!

Spread the love

When Marketing Professor E. Jerome McCarthy first proposed the "4 P’s" of Marketing in 1960, it is unlikely he would have predicted that his "Marketing Mix" categorization would become that industry’s standard and remain so for the next 50 years. But so it has gone. The framing of "Product", "Price", "Promotion" and "Place" has defined annual marketing plans ever since it was first introduced and still dominates the marketing industry today.

The problem is that this categorization is in desperate need of rejuvenation in the current context of an over-saturated marketing world, jaded consumers, and the emergence of the powerful, self aware, social networked customer. 

In response (and general frustration), I propose that the "4 P’s" need to move over and make room for a fifth P, a "P" significantly more attuned to the current marketing landscape. The fifth P that I would suggest is "People". Let me put a quick case forward for discussion.   

In his 2004 address to the American Association of Advertising Agencies (which should really be standard reading for marketers), the President of Yankelovich Consulting, J Walker Smith, noted that,

"Marketers haven’t done a lot to create positive views of their industry but they’ve done many things – unwanted spam and telemarketing, guerrilla marketing, intrusive ads covering every blank space and less targeted, less informational communications – that create more negative views. It’s time for marketers to focus their business models on how to better deliver the kind of marketing that consumers really want, instead of assuming that consumers are happy with fending off a daily deluge of marketing. The era of consumer resistance and control has begun." 

According to the Yankelovich study, 60% of consumers have a much more negative opinion of marketing and advertising now than a few years ago; 61% feel the amount of marketing and advertising is out of control; and 65% feel constantly bombarded with too much marketing and advertising.

So the $64,000 question is – then what is the type of marketing that "consumers really want"?  This is where I bring us back to my argument for a new marketing strategy around the "P" of People.

Using my own industry of financial services as an example, this study by the Deloitte Center for Banking Solutions is just one of the many studies indicating a common theme in how customers of financial services are receiving marketing messages differently.   

Look here specifically at the cross generational comparisons of "Doing Your Own Research", "Recommendations from Friends" and "Recommendations from Colleagues", versus "General Advertising". It paints quite a clear picture of marketing impact and behaviour and is a clear indicator on what’s missing in the 4 P’s methodology (click the chart to see full size).

Garrity1

The short story for me personally in this data is the need to create a marketing strategy not based on the traditional 4P’s but based on a definition of marketing that includes a "People" strategy.

How can we engage our customers? How can we allow our customers to engage each other? How can our customer care strategy include our customers and not just service our customers? How do we get our customers to evolve our product or service offer over time? How do we make our customers part of our brand itself?

In response to these questions, I think that developing a marketing strategy around "People" could look something like this:

  • A company website that is helpful, human and customer information-oriented (i.e. the information customers are looking for not the information you want to tell them)
  • An active voice in the blogosphere where you can engage the customer community (i.e. two way communication which is transparent to the outside world)
  • Providing tools to allow your customers to tell everyone they know what they like about you (or don’t)
  • Creating an active and engaged community of customers at your site encouraged (and incented) to help other customers to solve their common service or industry related questions
  • A strategy that says you are "in" the customer community and not "above" the customer community 

Notice that none of these marketing tactics are oriented around price discounts, promotional contests, creative brand building with quirky animal characters or broadcast advertising. 

This isn’t to argue that these traditional 4P’s don’t still have a role to play in the new marketing mix of successful companies. What I’m arguing is that they are no longer a complete picture of the framework for modern marketing, and with all due respect to Mr. McCarthy, that they have reached their hegemonic end.

Follow us!

6 thoughts on “Move Over 4P’s of Marketing, There’s a New “P” in Town!

  1. laurent

    A week ago, I listened to a panel and someone said that social networking works best around a ‘social product’ which means that people want to share/talk about it. If the product/service is ‘social’ (i.e: video sharing, pets..) it’s easier to do than if the product is not. I wonder what kind of strategy you could have around ‘credit card’ which doesn’t appear social nor to me.
    Having said that, there’s a lot of activity in the financial services on social media…as I, not so long ago, assembled a list of 1500 blogs on personal finance where people are talking about retirement, debt management, P2P lending.

  2. miro

    Michael
    interesting post
    Laurent, the answer to your question is all of the above.
    We need to think of our brands from the consumer’s standpoint and as such the question isn’t how does one create a people strategy for brand X in Category Y
    so much as understanding the kind of relationship different groups of customers will want to have with the brand be it transactional, logical, emotional, mature (Wallet, Mind, Heart, Life – using my taxonomy)
    I posted this “What relationship do your customer want with your brands” ( http://www.canadianmarketingblog.com/archives/2008/05/what_relationship_do_your_cust.html) on May 14 on the CMA blog
    – you might find it of value
    Miro

  3. Michael Garrity

    @Laurent – you wouldn’t normally think of credit card or bank account as inherently social but companies like Wasabe (www.wasabe.com) and Mint (www.mint.com) are proving that there is no shortage of folks who want to know how their spending patterns and service fees compare to others in similar income brackets or geographic areas. I think the power of social in financial services is the ability to out information into the hands of the product’s customers to make better decisions. Power to people, from the people. It’s what we are aiming to do at CommunityLend as well.
    @miro – great article and related – thanks.

  4. Barry Martin

    Nice thoughts Michael. Without doing the research, I’d be surprised if it hadn’t always been the case that recommendations from trusted sources would go farther than dancing baloney.
    As a vendor of marketing services, some might be surprised to find out I couldn’t agree with you more.
    But 12 years ago I would walk down King St. to my job at Saatchi with my head down to avoid the deluge of (crappy) ads.
    I don’t have a TV.
    I hate junk mail.
    And I’m offended by the waste inherent in big media buys with weak creative, strategy that doesn’t take context into account, and a broadcast (one way) mentality.
    In short, though I sell communications strategy and execution by day, I’m a person at all times. And for the life of me, I can’t figure out why marketers take off their people hats when they develop their promotions.
    My firm makes a good living by playing it straight with our clients. We keep an invisible bull-shit meter on the board-room table that sounds off when people start talking like they forget what moves them personally. Namely, a better product who’s value is communicated in a story that’s easy to digest, resonates with the right people, and is easy to pass on. That last one being key.
    There, I gave away our secret.
    Now everyone can get a better return on communications that sell.

  5. Michael

    @barry w – thanks for the back track references, confirmation for me once again that there are no new ideas
    @barry m – here, here – I can confirm as a previous customer of Hypenotic that you guys keep it real with a people based approach to marketing strategies. Cheers.

Comments are closed.