Beyond the 4 Ps and the 4 Cs The 4 Ps and the 4 Cs are beneficial in that they allow marketers to consider various aspects of the marketing function in a systematic and structured manner. Marketers who evaluate their own efforts based on the 4 Ps and/or evaluate their customers' experiences based on the 4 Cs are likely to be more successful than those who do not. However, as an effort to depict the marketing function as a whole, the 4 Ps and 4 Cs are not necessarily mutually exclusive and collectively exhaustive. In other words, they overlap in definition (particularly the 4 Cs) and do not necessarily cover all the major aspects of marketing. Instead, a more actionable approach can be obtained by considering marketing for what it is: an exchange process. In fact, we can say that the goal of marketing is to facilitate a perceived mutually beneficial exchange relationship between the marketer (seller, provider, etc.) and the customer (buyer, consumer, purchaser, etc.). As such, an approach that considers the exchange process and the particular exchanges that are being conducted, can greatly benefit marketers, their customers, and the marketing process as a whole. The Distribution Approach to Marketing Exchange The distribution approach to marketing exchange considers the flow of various elements in the exchange process between two entities. These entities can be individuals or organizations and will be referred to here as "seller" and "buyer" for simplicity. Thus, the distribution approach to marketing exchange would consider the flow of Information, Innovation, and Compensation between the buyer and the seller in the exchange process. Information. The flow of information is a two-way flow from seller to buyer and from buyer to seller. Sellers want to get their product information out to potential buyers, and sellers also want to collect information from buyers whether in the form of buyer preferences, questions, complaints, or any information that helps sellers construct a better exchange process. Of course, buyers want to receive information about the product offering, and also want to provide information that helps the exchange process to be more beneficial. Innovation. The flow of innovation concerns the complete delivery of the product offering that sellers provide to buyers. This includes not only a particular core product, but all ancillary products/services/etc. that make up the benefits offered by the seller to the buyer. The benefits of the innovation may come in offered goods, accompanying services, the delivery method, the prestige experienced, feelings of security, and/or a number of other ways. The more innovative the product innovation, the more likely it is that a firm/seller will sustain a differential (and sustainable) competitive advantage. Compensation. The flow of compensation is the part of the value exchange that flows back from the buyer to the seller. While this includes the price of the product (such as monetary compensation), it also includes non-monetary benefits that the seller receives from the buyer as a result of the marketing transaction. For example, a manufacturer might consider selling products to a large or well-known retailer even if that retailer offers payment much lower than the manufacturer's desired price. This might be because the perceived prestige of having an account as large or well-known as that retailer is seen as valuable to the manufacturer in terms of more selling power with other retailers, more financial borrowing power with banks, more credit power with the manufacturer's suppliers, and/or more personal satisfaction regarding taking on a mainstream client. Thus, compensation might include stability, prestige, positive word-of-mouth, etc. in addition to money. Transaction Costs. Inherent in all of the three flows of information, innovation, and compensation is the presence of transaction costs. These costs either add to the expense of the transaction for either party or subtract from the benefits that are received. For example, it costs the seller to advertise in a magazine or to explain product features on a website, and it costs the buyer to access the information (by purchasing a magazine, or needing a computer to access the internet, or just in the time spent acquiring the information). Transaction costs related to the flow of compensation include the buyer's cost of acquiring funds or the convenience of funds (i.e., interest, credit card annual charges, etc.), whereas compensation-related transaction costs for sellers could include bank fees, credit card fees, or fees for online payment systems (such as PayPal). Transaction costs associated with the delivery or the product innovation are evident. AAEAAQAAAAAAAAcbAAAAJGMyMDFjNWEzLTc2NDEt Using the Distribution Approach to Marketing Exchange The flows of information, innovation, and compensation are critical elements of the marketing exchange process. This type of model or approach helps the marketer (and the buyer) to focus finite resources on making the three flows both more effective in facilitating a mutually beneficial exchange relationship and more efficient by lowering transaction costs so that both the seller and the buyer can experience greater total benefits for lower total costs. Thus, whether marketers are dealing with the movement of desirable data (information), the movement of physical goods or intangible services (innovation), or the movement of payments (compensation), the focus of good marketing should be on finding ways to make exchanges more effective and more efficient. In the end, what is appropriate will depend on how each party perceives the various factors involved in those flows, but the end result should be an exchange that operates in a manner that is timely, smooth, reliable, and less costly - as long as all of these will add to the mutual satisfaction of the parties in question.
How does or could the material in this video/article (or some portion of it) apply to the mortgage industry if you were a mortgage lender?