The marketing mix

GCSE Business revision notes, key terms and practice questions.

The 4Ps

  • The marketing mix is product, price, promotion and place. The four parts must work together: a luxury product needs a high price, upmarket promotion and carefully chosen places to sell.

Product

  • Businesses consider design, features, quality, branding (name, logo and image) and a unique selling point.
  • The product life cycle has five stages: development, introduction, growth, maturity and decline. Extension strategies keep sales going, such as adding new features, finding new markets, changing the packaging, cutting the price or running new promotions.

Price

  • Price skimming sets a high price at launch, as with new technology. Penetration pricing sets a low price to win market share quickly. Competitive pricing matches rivals. Cost-plus pricing adds a percentage to costs. Promotional pricing offers temporary discounts. A loss leader is sold below cost to attract customers who then buy other products.

Promotion and place

  • Promotion informs, persuades and reminds customers, through advertising (TV, radio, print, billboards and online), sponsorship, special offers, free samples and trials, branding, social media and influencers.
  • Place is how products reach customers: through retailers, wholesalers, selling directly, or online (e-tailers and marketplaces). A distribution channel is the route from producer to customer, such as producer to wholesaler to retailer to customer.

Key terms

Marketing mix
The 4Ps: product, price, promotion and place.
Product life cycle
The stages a product goes through, from development to decline.
Extension strategy
A way of extending a product's life, such as adding new features.
Brand
A name, logo or image that makes a product recognisable.
Price skimming
Setting a high price when a product is launched.
Penetration pricing
Setting a low price to win market share quickly.
Loss leader
A product sold below cost to attract customers.
Promotion
Communicating with customers to inform, persuade and remind them.
Distribution channel
The route a product takes from producer to customer.
E-tailer
A retailer that sells online.

Practise The marketing mix: 12 questions