A Key Business Variable in the Marketing Mix - The Fifth-P is People
The traditional marketing variables of product, price, place, and promotion need to be updated to reflect an environment where consumers are more sophisticated. Communication channels to the consumer have expanded in number as well as complexity with the global expansion of the Internet and related information technology based products and services. Information is readily accessible in real time, competitive responses can be immediate, and new (potentially formidable) competitors can enter the market overnight with a website and a broadband connection from anywhere in the world. Every organization has two primary marketing goals; first to satisfy customer needs, and second, to provide an offering superior to that of their competitors.
The application of this theory to services, which are intangible, variable, and perishable as compared to a physical product, requires different marketing considerations to meet customer expectations. In marketing services, one of the key challenges is differentiating one service from another because the customer can only make judgments’ about service quality after the service is experienced. In service businesses, the importance of the employee delivering the service cannot be underestimated nor taken for granted a key component of the marketing mix. Total organizational alignment and employee commitment to serving the customer must exist before a company can deliver on a customer orientation promise. As a result, some marketers propose that the traditional 4-P's of marketing be expanded to include a fifth P, people-power in recognition of the employees’ role in helping an organization differentiate itself in order to gain a competitive advantage. For example, Home Depot prides itself on helping consumers with do-it-yourself projects. On such projects, it is common for a consumer to encounter a problem that they cannot solve. Home Depot routinely offers in-store training on painting, installing tile, and demonstrating the proper use of certain tools.
Marketing of the Future
Marketing in the 21st century has become a challenging endeavor for marketers. The “people” component of any marketing endeavor, whether in the creation, execution or provision of products or services to customers is a critical success factor for marketing professionals. As a result, companies should undertake steps to identify customers, differentiate between them, find opportunities to interact, and finally customize its products or services to meet customer needs using the unique skills provided by empowered and valued employees (the 5th P in the marketing mix).
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Author: Orlando Skelton, MBA
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