In this essay, I am going to compare and contrast a 4P (price, product, place and promotion) approach to marketing versus the value approach (creating, communicating, and delivering value). Furthermore, explaining the sameness and difference of two companies who apply the 4P marketing approach or the value approach.
In fact, 4Ps and the value marketing approach are correlated because both of the approaches are used for similar aims. The four Ps approach was introduced in the early 1950s which refers to product, price, place, and promotion and in the current era, it’s viewed as traditional approach to marketing. It’s notable that these 4Ps are nouns, while the values approach components are verbs. In addition, the value marketing approach is just an upgraded form of the 4P approach which includes creating, communicating, delivering, and exchanging value. In the 4P approach to the marketing, more focus is on the product, while in the value approach, unlike the 4P approach, more focus is delivering value to the customers.
The 4Ps Approach to the Marketing
The components of the 4Ps approach to the marketing are product, price, place, and promotion. These 4Ps are also called marketing mix which means that these 4Ps are mixed in a marketing plan. In this approach of marketing, the first component focused on in the marketing plan is a product.
Product. In 4Ps approach, companies first determine the needs and wants of customers. Then they try to create such as product or service which meets the needs or demands of their targeted customers that is supposed to be unique or better than the products or services of their competitors. A successful company brings innovations and upgrades in its products so it’s believed that upgrading products are a competitive advantages. Such innovated and upgraded products which attracts customers and meets their needs and demands are supposed to be selling itself.
Price. The second aspect of this approach is price that can be a competitive advantage. It’s possible that, in case if the product is not unique so price plays an important role so a great pricing strategy can take the product towards to the selling success.
Place. After the price, the next component is place. Means that after creating the product and pricing, its placement in the right locations are important. Placement involves creating or perhaps locating an appropriate distribution channels through which the product would be sold to the targeted customers or consumers where they can buy it.
Promotion. Final step of the 4P approach to the marketing is promotion. This step is a communication between a product(s) or company and the customers or consumers because promotion lets the company to inform their targeted customers or consumers about the advantages and qualities of a product. This way potential buyers can learn about the product and possibly buy it (in case of meeting their need and/or demand).
The Value Approach to the Marketing
In the value approach to the marketing, there are four activities, or components, of marketing which are creating value, communicating value, delivering value, and exchanging value. All the four components of the value approach are verbs and in this approach, marketing is composed of the mentioned four activities centered on customer value. In this approach the first activity is creating a value.
Creating value. This step of the value approach is somewhat similar to the ‘product’ step of the 4Ps approach because in both, first product is created according to the needs and demands of the customer. However, in the 4P approach, the focus is on creating a product. While in the value approach, the focus is on creating such an offering that gives value to the customer, not just product. The value approach is selling not just the product, and of value of the offering, and some additional benefits that accompany the product.
Communicating value. The next step in the value approach is communicating value. As similar to the promotion step of the 4Ps approach, communicating involves informing the customer or consumer on the offer, but the difference is just in information delivered to the customer. Because 4Ps approach advertises the product, while in the value approach the value of offering is promoted to the customers such as product plus service, benefits and enjoyments that can be received with the product, even after sales. As well, this approach involves learning about the preferences and desires of the customers.
Delivering value. Delivering may be compared to place of the 4Ps approach, but in fact they are different from each another. Place needs to having a place where the customer can easily have access and buy the product. In addition, delivering also involves making sure that the customer will be able to get the offering including the value, product, and its benefits.
Exchanging value. Finally comes exchanging. This step of the value approach involves trading value for those offerings is provided to the customer. The company gives the offering for the customer and in exchange they charge some monetary amount for the offering.
What would you expect to be the same and what would you expect to be different between two companies who apply one or the other approach?
In marketing both 4Ps and the value marketing approaches are correlated with each another because both of the approaches are used for similar aims. However, it’s mentionable that the 4Ps approach is a traditional way which focuses on the product, while the value approach is an upgraded form of the 4Ps approach which focuses on giving value through offerings to the customer.
In general, we could expect the sameness of both approaches to create products and distribute to the targeted customers, but when we focus in depth on both approaches so they are fully different from each another. Because the company who apply 4Ps approach just creates product based on needs of the customers, do proper pricing, place the product through distribution channels, and finally promote its products. Hence, the customers just receive the product based on their needs and demands. While the company who apply the value approach receives great attention of its customers because this approach of marketing provides best offerings to the customers such as the value, the product, and its benefits and even along with after sales services of the product.
Ultimately, there is difference between two who apply the 4Ps or the value marketing approach because one creates product while the other approach creates value.