The Marketing Mix 4Ps is an analytical model used by businesses to attract customers. It is made up of four elements which are referred to as Ps, simply because they all start with the letter P. These are Product, Price, Place, and Promotion. It’s important to be aware that the most effective businesses constantly adapt their marketing mix to the changes which happen within their environment. In this video, we will look at each P individually and apply the Marketing Mix to McDonalds to see how they effectively use the 4Ps to attract customers. The first P is product. The product element of the marketing mix is focused on the products or services that a business sells. Products are classified as tangible items as they come in a physical form and can be touched by the consumer. For example, smart phones, clothing, and trainers are all classed as tangible products. Whereas services are classed as intangible as they cannot be touched by the consumer. Examples of services include, beauty treatments, car valeting, and pet sitting. When developing a product to sell to the public, it’s crucially important that the business conducts market research to identify the wants and needs of the consumers within its target market. Following this, where possible a business should seek to differentiate its products and services to stand out from the competition and increase the chances of the customers shopping with them. This is where the USP comes into play as the business aims to make the product or service different to what is already available elsewhere in the market. Traditionally, McDonald’s offered fast food which was perceived by the public as predominately unhealthy but tasty, with the core products within its portfolio including burgers, chips, and milkshakes. However, over the years McDonald’s has diversified its product portfolio and adapted to changing consumer tastes. For example, McDonald’s has introduced a wide range of diverse products such as it’s McCafe range, a breakfast menu, salads, aswell as vegetarian and vegan meal options. This has helped McDonald’s to attract a wider audience and meet the wants and needs of more consumers, which in turn has helped them to increase sales. We now move onto the second P which is Price. Price is focused on the selling price set by the business for its products and services. It’s a very important element of the marketing mix and one that truly impacts buyer behaviour. Before setting a selling price, it’s important that the business understands how much the customers within their target market are willing and able to pay. but there are several factors which influence this. These include: The availability of the product or service, for example, if a product is in short supply, this typically drives up the price a business can charge. Competition in the market also impacts price, for example, if a business has many competitors who offer similar products or services, it is likely that it will need to reduce its prices to compete and attract customers within the crowded marketplace. In addition, the brand image is a very influential factor as most customers have a preconceived opinion about the business and its products which influences its worth to them. A business with a very strong brand image is typically able to charge more for their products and services as customers find the brand desirable and trustworthy. Once a business has considered these factors and knows how much the customers within their target market are willing and able to pay for its products and services, it’s then able to utilise a range of pricing strategies to influence buyer behaviour. The price of McDonald’s products could be considered as being very competitive with many people visiting McDonald’s stores not only because of factors such as convenience and speed but because the products are also very affordable. They even offer customers a ‘Saver Menu’ which features fan favourites such as the famous cheeseburger, Fries, and McFlurry’s for just 99p. However, in recent years, McDonald’s have introduced a signature range which is focused on what they deem to be a more premium upmarket product with a higher selling price, with the aim of attracting customers who are willing to pay more for a better-quality product that still comes with the convenience and familiarity of McDonalds. The third P of the marketing mix is Place. Place is focused on the location where customers can purchase the products or services which the business offers. Common examples of place include: Retail stores which customers can physically visit. Online such as a website or a mobile application which customers can access via the internet. Or purchases made directly from the manufacturer. In today’s business world, it’s very important to provide customers with the opportunity to purchase products and services in a variety of places which are convenient to them such as having both physical retail stores and a website. As of 2020, McDonald’s had over 39,000 restaurants around the world, meaning customers are never too far away from a McDonald’s or seeing those famous arches in the distance. Traditionally, McDonald’s could only be purchased instore at their restaurants or by utilising their drive through. This has all changed in recent years as McDonald’s have introduced a variety of new ways for customers to purchase their products which include: A mobile application known as ‘My McDonald’s’ which allows customers to order online and a delivery service which is known as ‘McDelivery’ that allows customers to have food delivered directly to them through third party delivery services such as Uber Eats and Just Eat. The fourth and final P is Promotion. Promotion is focused on the activities undertaken by a business to generate interest and make customers aware of the products and services which they sell. Businesses often use a wide variety of promotional activities with the aim of ultimately increasing sales. Common methods of promotion include discounts and special offers, social media activity, influencers, sponsorship, and advertising across a range of multimedia such as TV, radio, billboards, online video, and website banners. McDonald’s uses a mixture of promotional activities to bring attention to the brand and increase sales. Advertising is one of their most effective promotional techniques and something McDonald’s takes very seriously, having spent over $600 million in 2020 alone to carry out campaigns across TV, Newspaper, Radio and billboards just to name a few. McDonald’s also use sales promotion as a short-term incentive which is designed to encourage people to buy more of their fast-food products. For example, the Monopoly promotion where customers receive stickers with their meal which gives them the chance of winning free food, discounts at certain retailers or even cash prizes for a limited time which has successfully increased sales at McDonald’s as people buy more often and buy larger meals to increase their chances of winning. McDonald’s also utilise direct marketing through email and app notifications by targeting their customers with special offers and seasonal menus items designed to encourage them to make an order online or instore. Now that we’ve looked at each of the 4Ps with some examples of how McDonald’s utilises them, it’s important to be aware that the 4Ps shouldn’t be used in isolation and for the marketing mix to be truly effective in attracting customers and increasing spending, it’s crucial that each element of the marketing mix complements the others. Hopefully, that’s provided you with a better understanding of this analytical marketing model and how it is used in business. If you’ve found the video helpful, it would be appreciated if you could hit the like button and remember to subscribe to Two Teacher’s YouTube channel if you aren’t already to see lots more business videos just like this. Thanks for listening and all the best.