Time was that marketing was about the Four Ps: Product, Price, Place, and Promotion. Back when I received my certification as a marketing professional, I was schooled in each of the Four Ps. But somewhere along the way, we lost three of the Ps and were left just with promotion, or as we usually refer to it, messaging.
We marketers have spent a lot of time thinking about how the Internet has affected promotion. Whole new areas of tactics have cropped up, ranging from email and banner ads to search marketing and social media. Lots of pixels have been spilled discussing how marketers can adapt to the new world order that the Internet has ushered in. But we have spent relatively little time noticing the changes in the rest of marketing.
Take a look at how the Internet is affecting Product, one of the neglected of the Four Ps. Have you noticed the trend to crowdsourcing? Check out Dell Inc. (Nasdaq: DELL)’s IdeaStorm, where thousands of suggestions for new and improved Dell computers are contributed for free by Dell customers.
And P&G researchers now source over one-third of their ideas from outside the company, many through Web collaborations with retired scientists.
What about the Internet's effect on Price? Sure, we all know that the Internet has lowered prices through efficient auctions (eBay) or better product selection and distribution (Amazon) or even reverse auctions (Priceline), but look deeper to see some of the other innovations that affect pricing. Did you ever expect to see an insurance company that displays the pricing of its competitors? Go to Progressive.com to see how it works.
You probably haven't thought that these changes affect B2B very much, but they do. Check out the e-marketplace for the global cement industry, and think about how that affects prices. If the cement industry has an e-marketplace, I bet yours does, too.
Which leads us to Place. Sure, the Internet itself is a new place to do marketing (and often sales), but we usually think of search marketing and e-commerce as old hat. Newer are the communities forming around industries, such as our global cement marketplace. And think about how Elance has transformed the way services are contracted for and received. None of these changes in distribution would have been possible before the Internet, and they drastically affect the way we think about marketing.
If you look even more closely, you'll see that the Internet is changing marketing in an even bigger way, not stopping at merely forcing marketers to rediscover other branches of marketing, but merging marketing with other disciplines, such as sales, public relations, and customer service.
Traditional marketing celebrated specialization, as each task was attacked with efficiency. The Internet, so far, is changing rapidly enough that we haven't yet figured out what to specialize in, what to be efficient in.
Many forms of Internet marketing are inherently more efficient than traditional marketing, so perhaps the real secret to Internet marketing is the flexibility to continue to push for new ways of getting things done.
Keep looking at your job more widely, to see how it intersects with your company's broader purpose, rather than narrowly to see how you can do the same old thing a little better. The Internet keeps breaking down silos between specialties, so don't find yourself trapped within yours.
— Mike Moran, author of Do It Wrong Quickly, is a speaker and consultant on Internet marketing.
Good points, naminson. It truly has changed all businesses and expanded the choices.
That is particularly the reason that marketers need to follow Mike's advice and focus on specific lines to market. If you try to be all things to all people you will be less effective in the vast array of choices.
This is a good thing - but truly requires new assessment of how to use the tools. Not just use the new tools in the old ways.
Please correct me if i am wrong but i feel the fifth P can be point scoring. Point scoring with your competitors and gaining more customers. Nowadays internet is all about prescence, your product's got to be seen literally all over the place, be it facebook, twitter, my space etc, to garner interest among the potential customers.
I get monthly sale alerts via text messaging from a clothing chain that claim their sale is the best in town and that i can avail more discount on showing the message at the time of purchase.
Another change in Marketing that has happened is that internet has shifted some power away from BIG businesses & moved it towards new competition & also to the customer. So the forces in Porter's classical model have changed considerably. Crowd sourcing, blogging, online product ratings, disintermediation etc, have made Marketing & PR departments more vigilant. Marketing of services has taken a different role altogether where a much larger demographic has now become addressable. The only businesses whose marketing space has been unaffected by internet are microbusinesses like the cobbler on curb.
Thus internet has played a role of both facilitator as well as enabler in different capacities to Marketing.
what I want to know is: what kind of company are you?
when I dropped my POTS service for VOIP my POTS provider continued billing me for 3 months -- even though I called them each month and they assured me they were taking care of the problem
I had to call the Public Service Commission to make them cancel the service and correct the bill
is that the kind of company you want to deal with?
things like Angie's list can help. the customer reviews on Amazon are superb.
we have coprprations out there that need to get run through the shredder. the Clark Howard show helps with this as well. word of mouth at the Local Saloon is now world wide over the web in a day
That's my advice, too, but it is sometimes hard for small business owners to hear. They think I am asking them to stop offering part of their product line, and they'd rather be able to sell everything. Instead what I am advising is that they concentrate on a small part of their line that they can beat all competitors for, usually with their expertise. That's where they need to go in the Internet, even while having a broader line in their physical stores.
Absolutely Mike. Most local businesses that leverage the "home town advantage" will certainly continue to do so. They could even use that in their local marketing materials as the main benefit of choosing them over some online competitor. I would suggest that in addition to catering to their local, physical customer-base, it is also wise for the smaller businesses to carve out a specialty on the internet as you suggested, thereby reaching customers that they would not have otherwise had access to. Small businesses that can market that specialty product that "big box" or volume internet sellers won't be bothered with can reap the benefits by fulfilling a previously ignored need. Therefore, they can capitalize on their local differentiation while also carving out a place for themselves in cyber-space.
Agreed, tnieusma, but it's a two-edged sword, because these small businesses now must compete with other businesses when they used to have more of a local monopoly. Some of them are finding that being local was their main differentiator, which forces them to specialize more at least for their online presence.
Thank you for the interesting post Mike! This started me thinking about how the barriers to entry have been changed by the internet. Product, Price, Place, and Promotion were always potential barriers in the past. With the evolution of the internet, none of those are nearly the issue they once were.
For example, it is possible for a small business to find and leverage cooperative manufacturing and supply chain for their product with a few taps of the keyboard. This ability will in most cases lower the cost of goods and subsequently the price of the product. In addition, the place of the business or product is not nearly as important since it is now customary to purchase things from afar via the internet. Smaller, niche companies can now promote via the internet for a fraction of the price of more traditional marketing and with increased ability to reach their target demographic. In short, the landscape has changed and those who don't changed with it will most likely be left behind as new business leap over the lowered barriers to entry and climb into their backyard.
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