There are two similar approaches to marketing: the 4-Ps “Marketing Mix” approach and the value approach. Put your clients first in marketing with the value approach and make them more loyal and more engaged by showing them that your offer is built around them, not your shareholders. By changing your perspective toward being value-driven, your customers will notice small changes in your marketing that frames your solutions more in their favor. This psychological change will be felt by them. Yes, the marketing mix is tried and true, but it has a weakness in that is not customer-centric (Cross, n.d.). By focusing on driving value at every step, the value approach meets your clients’ modern needs.
Customer-centricity and driving value has two side effects: increased social responsibility, more business alliances, and focusing on customers’ values. How does the value approach improve social responsibility? Let’s look at Ben & Jerry’s for an example. In 2000 they reported that their strategies were all value-driven, which ended up driving initiatives towards economic, environmental, and social justice (Cross, n.d.). Basing your solutions around value will also be a beacon for other businesses. They will want to partner up and make a value-added package with you. They will want to help you bring it to market. They will want to be a part of this engagement that you are creating, and they will want to gain those loyal customers along with you.
Most importantly: Customers will sense that you are their ally. They feel that you are marketing what matters to them in a way that touches their values. They know that you care. Customers will become more engaged and have an actual relationship with you if they feel that you care. You will build not only your brand, but customer loyalty.
How do you think about marketing in a way that brings the traditional 4-P’s approach up to the modern value approach?
The 4-Ps approach to marketing describes marketing with the four components: product, promotion, place, and price. This marketing mix from the 1950s is very analogous to the value approach to marketing but is focused on things rather than actions (Tanner, 2015, p.5). The value approach highlights the process of creating (value), communicating (the value), delivering (value), and exchanging (value). The value approach to marketing is more collaborative and focuses on mutual value and focuses on the customer.
The 4-Ps approach has a product (goods or services) in common with the value approach to marketing. In the value approach, the product is created through collaboration about what has value. In the 4-Ps approach, the concept of value is missing as well as the concepts of creativity and collaboration. Focusing on packing more value into the offering beyond the price: the intangible and tangible value that the product has to a customer has become important in the value approach (Tanner, 2015, p.8).
Some of parts of the approaches are similar. For instance, promotion and communicating are both different angles to the same task: informing the customer. Promotion is focused on the product and is primarily a one-way flow of information, but communicating is focused on a two-way discussion, learning from the customers while informing around value. The differences revolve around how limited ‘promotion’ is, in pitching a product, compared to communicating on value, learning the customer’s values, and having a conversation. Communicating does include those promotional aspects, but also becomes interactive and conversational (Tanner, 2015, p.8).
In the 4-Ps approach, product placement was a focal point. Location and place are important. Customers need to be able to purchase the product where they want to, so distribution methods and strategy around placement is a big deal in the 4-Ps approach. In the value approach, the focus is on delivering the product in a way that increases value to the customer (Tanner, 2015, p.5). Value is very personal to individual shoppers, and shopping adds a certain amount of hassle to the customer, so finding ways to deliver value to the customer by reducing that hassle gives an advantage (Tanner, 2015, p.6). Free shipping and online order/curbside pickup services are conveniences that add value to the delivery of the product into a customer’s hands. Many companies focus on logistics for increasing delivery capabilities as well as supply chain capabilities to improve value to the customer (Tanner, 2015, p.9).
In the 4-Ps approach, price is an important part of the equation. In the value approach, it is about exchanging value. Pricing strategy still plays a role, but in the value approach value is traded rather than focusing on a monetary amount.
A company that focuses on the 4-Ps approach to marketing would probably have a good product, advertise well, price their products competitively, and place their products in the best retail locations. Picture a JC Penney or other department store or big box store like Best Buy or Circuit City. They did retail sales well, advertised well, and had great products at good prices. The market changed to wanting to purchase things different ways, at different places, with different methods of delivery. Standards of value changed, and customers now demand more communication and more value.
A company that focuses on the value approach is more like Apple or Amazon or Target, focusing on developing their supply chains and shipping capacity to deliver great products to their customers wherever they are. They design their solutions around market wants, which they communicate and collect data on and discover. Their focus is not necessarily on price, as Apple and Target are both more expensive than competitors. Their focus is on being more attractive through driving value to their customers. Both companies give good products and advertise. Companies like Apple, Amazon, and Target are more engaged with their customers than 4-Ps companies, though.
Even in those examples, you can see that the 4-Ps approach has been disrupted and replaced by the value approach. Market with driving value to the customer in mind first, then the rest will come together.
References
Cross, Vanessa. (n.d.). “The Goals of Values-Based Marketing.” Small Business — Chron.com, http://smallbusiness.chron.com/goals-valuesbased-marketing-21639.html. Accessed 06 May 2020.
Tanner, Raymond. (2015). Principles of Marketing. Published by Flat World Knowledge.
Art Ocain is the President & Chief Operating Officer at MePush, Inc. a managed service provider that serves IT architecture, operations, and cybersecurity needs across all verticals. Art has been in IT for over 20 years and has been a tech in the trenches as well as a manager in web hosting, internet service providers, enterprise IT, as well as services for the SMB market. You can read more on his LinkedIn profile: https://www.linkedin.com/in/artocain/
