There are four generally agreed principles of marketing. You may be considering entering the market with a new product/brand – this handy little guide might help you…
By James Smith
When looking at your new product, you need to decide at what price point it should sit. There are further discussions to be had at this stage, but you essentially have three options: low, middle or premium. Is your product top end – and therefore deserving of a premium price – or do you prefer to aim for the volume market in the middle or even entry-level price points? If you’re unsure, check Google and analyse your competitors. It’s a worthwhile exercise. From here, you can start thinking about the remaining Ps.
Place refers to the ‘how’ of the product sale. You may already have a plan for this in mind, but it’s worth weighing up a number of different sales channels. The UK market has several entry channels including distribution, agents, direct retail and wholesale. Each has its own pros and cons, and they are not exclusive of one another.
Distribution will require a partner with experience in the market that can hold and distribute stock. It will require a discount on retail pricing and will expect a marketing input from you.
An agent will work on commission only. The UK market is large, and therefore several agents will be required to ensure full coverage. Each agent will need clear territory, pricing and brand guidelines. Agents will sell directly to retailers at full trade pricing. Most agents will have more than one brand in their portfolio.
Salaried staff will need minimum wage, work location, pension contributions and will work within UK guidelines. They will, however, be fully employed and answerable only to you.
There are two overarching marketing strategies: push and pull. A push strategy will use one or several of the following: sales force, discounts to distributors or other methods of incentives to push the product on to the end consumer. This strategy is not recommended for high-end products due to the discounting nature and potential damage to the brand in the long term.
A push strategy might be a discount code with a minimum spend or a BOGOF offer – these have a very strong effect of pushing a sale on to the end consumer. However, it can affect a brand negatively if overdone. It must be considered that some companies are not driven by brand quality; rather, they are driven by volume.
The pull strategy form of marketing uses promotion of the brand and other online or offline methods of communication with end users, which, in general, will give more control to your brand in its communications with end consumers. A high-quality promo video, a sponsorship, a relationship with an influencer, or a curated social media profile are all examples of pull marketing.
With reference to price, if you deem your product worthy as a premium product, then you must consider the following. A premium product would require premium packaging, product, retailers and of course brand voice. Brand will be a primary concern when reaching out to the premium market. Keller 2008 states: “A company having strong brand image is more likely to get qualified intermediaries, and middlemen working more enthusiastically to promote a product with a strong brand image and demand.”
This does not mean that a middle-of-the-range product should be thrown into a plain cardboard box, but brand voice/position will not be your first priority. An entry-level brand will in the main often have lower margins, so any brand promotion, packaging etc will have to be considered against your margins. The four Ps are not the bible and are not exclusive of each other, but are a general guideline to help you make your decisions when starting out.