The Distribution Approach to Marketing Exchange
Marketing is about creating value through exchanges, but most people view marketing as only a small portion of those exchange processes. Using a distribution approach to marketing exchange — one that focuses on making the flows of information, innovation, and compensation more effective and more efficient — will increase your ability to see the "big picture" as well as focus on what needs to be improved.
Reviewing the 4 Ps
Marketing often is described in terms of the “marketing mix,” which for years has been considered “the four Ps” of marketing: Product, Promotion, Price, and Place. Let’s review them briefly (skip past this section if you’re already a 4P pro).
Product consists of not just the actual physical good (if there’s a physical good involved), but all of the services and ancillary goods that go along with it. Thus, “product” could refer to a good, service, information, entertainment, experience, location, political candidate, idea, etc.
Promotion is often thought of as the message moving from the seller to the buyer. It could include formal advertising as well as other methods by which information is transferred for the purpose of selling the product. It also is sometimes considered to encompass tactics that help to sell the product (such as educational campaigns, co-branding, price reductions, etc.).
Price of course refers to the price of the product—how much the buyer will pay. But it also can include additional costs of acquiring the product.
Place, also referred to as Placement or Distribution, considers where the product can be purchased (from as general as the basic geographic area to as specific as where on the shelf it’s located) as well as the path from the various sellers (e.g., manufacturers, assemblers, wholesalers, retailers) to the various buyers.
The Customer-Focused 4 Cs
The 4 Ps are quite straightforward, and they’re often seen as being from the marketer’s perspective. That one-sided approach motivated marketing professor and author Philip Kotler to begin advocating “the four Cs” to consider marketing more from the customer perspective. The four Cs (note that there are multiple versions of these) are:
Customer Value (somewhat analogous to Product) should include the customer’s view of what’s valuable, beneficial, and pertinent to the customer’s needs and wants.
Communication (compared to Promotion) is more of a dyadic (two-way) approach to information transfer rather than Promotion’s seemingly unidirectional view.
Cost to the Customer (includes Price) would include all costs experienced by the customer, whether paid to the seller or to other firms that help facilitate the transaction (e.g., to shippers, inspectors, etc.).
Convenience (a reference to the accessibility of Place) is based on the idea that from the customer’s perspective, the convenience of acquiring the product often is more relevant than the transportation path (distribution channel) that made the product accessible.
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? ??