One of the most important framework used by marketeers to understand a market segment, target the right market and position her products well into a market is defined by the 4Ps of marketing namely Product, Price, Place and Promotion. All these Ps analyzed individually and then sewn together offer such valuable insights to even today’s marketing professionals. But 4Ps is an old framework and have evolved by continuous discussions by the marketing gurus. Some added 3 more Ps to the already 4 Ps – packaging, positioning and people and collectively called them as 7Ps of marketing. Other say that 4Ps are no more valid in today’s dynamic consumer centric market. We will focus on the evolution of 4Ps to more a consumer centric approach in these set of articles.
4Ps to 4Cs of Marketing
Many debate that the concept of Ps is from producers point of view so not a complete or useful concept in today’s dynamic market where customer should be the focus. It makes a huge difference in one’s product design, development and marketing approaches when one sits on the other side of the table and see from consumer’s point of view (pov). 4Ps of marketing has been replaced by 4Cs of marketing today where consumer is sitting in the center and things are not looked upon from the side where sellers are sitting.
4Cs of marketing namely Consumer (in place of Product), Cost (Price), Convenience (Place) and Communication (Promotion) have replaced 4Ps and is extensively used by many businesses today. This post will focus on the most important parameter of this framework from both the sides and establish the fact that why marketeers should abandon the 4Ps and start using 4Cs of marketing.
Product vs. Consumer
Product, undoubtedly, is the most important of all Ps of marketing. Without a product, there is no business, no market, no consumer. Traditionally, producers only focused on a product thinking if they manufacture, consumers will buy. This was due to the fact that demands was high and supply was low. Producer’s had the bargaining power and whatever they produced, consumer had to buy since there were few choices, sometimes it was dominated by a monopoly. This is the reason marketing professionals focused on Product using 4Ps of marketing as an important frameworks for market segmentation and positioning.
Today, with multiple choices of identical goods available to the consumer, producers must vacate traditional mindset of focusing on the product. Products were manufactured to satiate consumer needs – passive, active or latent – but as markets evolved, it changed the game altogether. Today producers have severe competition, standard products are available from many manufacturers and the key is to offer something to the consumer that they are to ready to pay for. Producer’s have to improve their offerings more frequently than ever before and while doing so they must wear their customer’s shoes (or eat their dog’s food) to know the pain points and how their product will address the pain points of a customer or offer value.
Knowing each if their customer’s requirements is a very sophisticated and complex issue. It is extremely difficult to build a product that satisfy “all” the customers and their needs. Every customer is unique with their own set of needs. Thus, a product that is built from a producer’s point of view (pov) even after doing extensive consumer research is always a standard product that producers feel will fit all sizes and types of their target market. Producers want to benefit from economies of scale where businesses are volume / cost strategy based businesses. Producers always wanted to produce a standard product in high volumes and until a few years back, the “Product” attribute of the 4Ps mainly focused on offering a standard product to its consumers which they also bought.
In today’s market, however, that strategy does not work successfully. Producers had to shift their focus from products to consumers and deploy a strategy to form an ecosystem around their offerings to satisfy customers with a customized product. Take an example of smartphones. Earlier smartphones about a decade ago were standard products that had a set of applications a user can use with specific use-cases. Making calls, sending messages and emails were through the inbuilt apps. Today, with the help of an ecosystem, complementary goods are sold to be used with the main product so that consumers can customize them, for example through Apps, browser based web-application to utilize the internet, add-ons, service subscription. This enables a customer to use that product the way they want to. Some customers also act as prosumers and help in design and development of a product. Today, consumers dictate a product, provide its feature-set and the requirements as if students themselves are designing the curriculum of their graduations school. Would that be just awesome if they knew what they should and want to study? It would definitely be but the problem is that they don’t know and that is where marketers have to be smart to make it a mutual process to offer innovative products.
So how can that paradigm shift can be used by businesses for their benefits? The answer is to build products both modular and scalable. These two aspects dictate the ease of customization for producers as well as consumers and if we have the right magnitude of these two attributes available in the product development process, many instances of a product can be built to offer a line of products which can cater to the requirements of a group of people. And to enable modular and scalable solutions, a producer’s ecosystem is most crucial part of this customization strategy since they provide the building blocks of a product. Any product developed by the producers must take the dynamics of an ecosystem and benefits of a win-win partnership model into consideration.
Since a few years, the focus of producers is already shifting towards consumer as the central point, not a product. And it did not happen in a day, it took years and it is still an evolving phenomenon. Businesses value partnerships and ecosystems today since they want to offer a complete as well as a customizable product to the market. The focus is no more the product but the consumer and it is highly tenable inference that the most important P of marketing has already been replaced by the consumer, the most important C of marketing.
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