A good Marketing Mix includes the 4Ps. But, is it enough to succeed in the digital world? If not, which solutions can be used to bridge the gap? Is the Customer Data Platform the key? Keep reading to find out.
The line dividing the change from one paradigm to the next is often blurry. Until recently, one could safely say that a good Marketing Mix, or the famous 4Ps (Product, Price, Place, Promotion) is effective enough to generate a healthy ROI. However, in hindsight, one can observe that this two-dimensional approach (customer-brand) definitely needs a facelift. Everything that makes up effective marketing today will require the addition of a few cognitive layers. And here are numbers to prove it.
- Research found that companies that earn $1 billion annually can expect to earn, on average, an additional $700 million within 3 years by investing in customer experience. (Temkin Group)
- (Product) Companies with a customer experience mindset drive4-8% higher revenue than their industry peers. (Bain)
- (Price) Up to 43% of all consumers would pay more for greater convenience; 42% would pay more for a friendly, welcoming experience. And, among U.S. customers, 65% find a positive experience with a brand to be more influential than a shiney advertising campaign. (PWC)
- (Place) In a global survey, 74% of in-store shoppers who searched online before going to the store to shop, said they searched for something in-store related, such as: the closest store near them, locations, in stock near them, hours, directions, wait times, and contact information. (Google)
- (Promotion) Practically all of us favor peer recommendations. As much as 92% of people, in fact, trust product recommendations from friends. In comparison, only 24% trust ads. (Zuberance)
Modern marketing tools, such as Customer Data Platforms (CDPs), can be a powerful tool in making this smooth transition. First, a bit of theory.
What is a classic Marketing Mix?
The Economist Times defines Marketing Mix as follows:
The marketing mix refers to the set of actions, or tactics, that a company uses to promote its brand or product in the market.
Source: The Economic Times
The Classic Marketing Mix consists of 4 components:
Addressing these elements, in theory, guarantees a comprehensive approach to the overall marketing effort. So why the change?
New Marketing Mix: Replacing the 4Ps with the 4Es
There’s no denying that the 4Ps are no longer enough today. Around 2015, professionals began to redefine the components needed for success. However, instead of changing their structure, they started looking for a way to adapt to the changes which they observe in society.
Where does the need for change stem from?
It will not come as a surprise if I say that the main factors are the wide availability of all kinds of products. This is made possible by the ubiquity of the Internet and online payments, and a shift in consumer behaviors. Younger generations are paying attention to different aspects of the product than their parents. In addition, they are interacting with it in new ways in a multitude of channels. It is this globalist, egalitarian, and interactive layer that requires a totally new way of thinking and doing in marketing.
What are the 4Es of the New Marketing Mix?
As the marketing space react to a ever changing world, the components of an effective Marketing Mix must also change.There is now a migration to the 4Es:
While the 4Ps are still important, the Marketing Mix should include these components.
What’s behind the 4Es?
Let’s first define the different aspects of each of the 4Es. By understanding them, you can better find areas where you can leverage your resources to better develop your product and the consumer experience (CX) that follows.
More than the product itself, consumers are paying attention to the experience arising from its purchase, and use. This includes its design, quality, usability, but also social aspects ( belonging to groups, participation in popular movements, etc.).
This goes far beyond a one-dimensional understanding of the product. The experience of those interacting with the brand at numerous touch points is also relevant. This will include:
- familiarization with the brand and product,
- gradual purchase decision,
- purchase experience,
- receiving the product,
- post-purchase service,
- and a plethora of loyalty building activities.
The price is still one of the important factors that make up a product. However, it loses its place in the rankings to the aforementioned experience. Oftentimes, you can find products online in freemium versions, or at incredibly low promotional prices. Purchasing decisions will be dictated by whether they recognize the added value of the product. This is where the greatest exchange is happening. When the choices are endless, it’s the details that matter to shoppers and win over the competition.
Omnichannel as a word has made its way into the marketing vocabulary for good. Today, brands cannot afford to be absent from any marketing channels. A comprehensive use of the channels enjoyed by the brand’s customers and/or potential customers works much better.
However, there are several challenges. The first is to maintain consistency of the message and deliver format appropriate contents to audiences that switch repeatedly between channels.
The second challenge is to move away from third-party cookie-based marketing. In fact, leading browsers and ad networks will end their support of this practice in the near future. Zero- and first-party cookies are now preferred ways used to gather data and give consent. The fact that this is a voluntary thing will deepen the relationship between businesses and their customers.
For the past few years, I have seen the trend of placing more emphasis on loyalty and increasing customer retention. Loyal customers spend more money, plus they are much more likely to recommend the brand to friends. However, loyalty itself is no longer the Holy Grail. Brand evangelists are. These people aren’t just happy with the products, they feel the excitement of interacting with their favorite brand. They recommend beloved products to friends without any additional incentives. What is more, people who get such a recommendation spend more than traditional recommendations.
How to address the 4Es using CDP?
CDP platforms are powerful marketing tools that support growth in each of the 4 areas of the new Marketing Mix. Here are brief descriptions and examples of how a CDP is used in each of the named spaces.
CDP is the perfect tool for collecting, storing and using zero- and first-party data. Its capabilities allow you to deepen your understanding of the real needs and expectations of your customers. This knowledge will facilitate your strategic approach to product development, so it can best serve the people who buy it. Going further, the collected data can be used to design the overall consumer experience.
The features available in CDP, such as Alerts and Workflow, help accompany the customer throughout the Customer Journey.
Survey: A visitor to your site selects their preferences and interests in a survey. Using this, you can send them more interest-based content to their preferred channels.
Satisfaction: In the NPS form, customers leave feedback after purchase. By analyzing the responses, you can control the changes in the purchasing process to systematically increase satisfaction levels for future transactions.
Segmentation: Through a progressive pop-up, visitors are asked about their hobbies, favorite sport, location, and interesting product categories. This allows you to create advanced user segments which translates into the creation of more engagements, which in turn leads to increased profits.
Since price is no longer a key factor, brands should find a better way to communicate the true value of the product. Emphasizing the unique qualities of a product makes people aware of what they are really getting within the price they pay. Finding them is much easier when you can see what your best customers are paying attention to. The best part is that you don’t have to wait until purchase though. You can highlight the added value of your products to new leads.
Lead nurturing: For each new contact in your database, you run an educational cycle that relates to their interests and behaviors on your site. After learning about the offer presented in the educational email cycle, the likelihood that these individuals will purchase more expensive products based on the unique features increases.
Free/Freemium: Temporarily providing free access to premium content in exchange for contact information can result in a dramatic increase in your contact base. Users see the benefits of valuable content, or they get used to the convenience of the premium version and want to continue with the brand.
Increasing the value of the purchase over time: Even if the cost of subscribing to a popular magazine increases over time However, if the content provided is well suited to the subscribers’ profile, they will often choose to continue their relationship with the publisher.
CDP platforms make it possible to monitor the behavior of consumers at multiple touchpoints within the brand. The result is a complete 360° profile, enriched with newer and newer information. Thanks to progressive forms, surveys, and pop-ups as well as other Lead Generation tools, it is possible to collect data and use it conveniently in preferred communication channels. These include email, Mobile, Web Push, Social Media, advertising networks or your website. It allows for effective communication in both manual and automated campaigns.
Offline + Online: When a person makes an offline purchase, you can also reach out to the contact online. Of course, you need to use in-store behavior monitoring, for example through loyalty programs or a mobile app. Collecting this data allows you to later enable communication in new channels, for example, through personalized Web Push notifications.
App + Web: Mobile apps complement the digital eCommerce landscape more and more. By combining and unifying data across CDP platforms, it is possible to personalize messages displayed on the website according to behavior on the mobile app.
Email + Ad networks: There are times when the people stop opening emails. CDP allows you to automatically switch between channels. For example, you can show personalized Facebook or Google ads to John Smith who deleted your newsletter.
Strengthening the bonds between consumers and the brand requires a lot of work, but it pays off. The tools you use in this area include:
- building user experience (UX) and customer experience (CX),
- reaching the right people with the right message,
- progressive profiling,
- lead nurturing,
- post-purchase drip campaigns,
- keeping an eye on churn and negative feedback,
- and reacting quickly to behavioral changes.
Preventing customer churn: Imagine that a person moves from the medium churn risk segment to high. Following this, you might send them an automatic communication that stimulates them to take up the offer. This increases the chances that the person will nevertheless stay with the brand.
Stimulating and strengthening the relationship with the brand: The new contact takes the initial activity within your website. They also responded to educational emails. The CDP uses this data to automatically move the contact to the next stage in the sales funnel. The higher stage provides slightly different contents that correspond to the level of intimacy between the contact and the brand. Additionally, appropriately set automations help to gradually profile the contact by collecting zero- and first-party data, which in turn, helps to further personalize future communication even better.
Rewarding loyalty: New contacts are new contacts, but what about those who have been with you for a long time? For existing leads, especially those who have shopped multiple times in the store, you can set up a targeted newsletter campaign with a special offer aimed at these loyal users..
Some final thoughts
Aligning your tools with your audience’s needs is always a good investment. A space with customers who exhibit increasing awareness and demands present eCommerce owners and marketing professionals many new challenges. A good CDP platform will help you address most of them.
If you already have a platform but don’t know how to identify the 4Es for your business, be sure to speak to your Success Manager. They will be happy to help you find the right areas and implement the right actions.