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Lecture 2
1. Marketing strategy, Notebook LM
- What is meant by marketing strategy? Provide a clear definition and explain its core elements.
Marketing strategy is a comprehensive plan for a business to communicate with its target groups and stakeholders to promote its products or the company as a whole. It involves planning and executing the conception, pricing, promotion, and distribution of ideas, goods, and services to create and exchange value, and satisfy individual and organisational objectives
.
The core elements of a marketing strategy are traditionally known as the 4 Ps of the marketing mix
The information you provided regarding the three layers of the product tool – the core product (unique benefit), the tangible product (features, quality, design, packaging), and the augmented product (service layer like delivery, installation, after-sales service) – is from "epdf.pub_marketing-communications-a-european-perspective.pdf".
Specifically, this description can be found in a section discussing the Marketing Mix and its instruments. The source explains that:
This framework is part of how marketing communication integrates the instruments of the marketing mix to effectively convey product value, build brand awareness and loyalty, and influence consumer purchasing decisions.The information you provided regarding the three layers of the product tool – the core product (unique benefit), the tangible product (features, quality, design, packaging), and the augmented product (service layer like delivery, installation, after-sales service) – is from "epdf.pub_marketing-communications-a-european-perspective.pdf".
Specifically, this description can be found in a section discussing the Marketing Mix and its instruments. The source explains that:
This layered understanding of a product is fundamental to strategic marketing and plays a vital role in integrated marketing communications, where all marketing instruments are designed to work synergistically to present a consistent message to target audiences.
This is the only marketing instrument that generates revenue. The right pricing strategy is critical for a product's success and can communicate quality or exclusivity. Strategies include Price Skimming (high initial price, then lowered), Competition-Based Pricing, Premium Pricing (emphasising quality with a high price), Value-Based Pricing (based on perceived customer value), and Cost-Plus Pricing (production cost plus markup)
A social business must hit two (or three) bottom lines at once: cover its full economic cost and unlock the social / environmental outcomes it promises (
).
That tension shows up in four permanent questions:
Six field-tested pricing architectures for social enterprises
Table 82
Architecture
When to use it
Mechanics
Real-world signals
Architecture
When to use it
Mechanics
Real-world signals
Cost-plus with “mission margin”
Early-stage ventures that must become cash-positive fast
Add a transparent % on top of true unit cost; ring-fence part of that margin for impact spend
Craft breweries that post open-book costing; repair cafés that add a €2 “community dividend” line
Cross-subsidy (“Robin-Hood”)
Segments have very different ability-to-pay
Premium or B2B line funds a low-cost or free tier for priority users
Aravind Eye Hospital charges market rates to wealthier patients so 50–60 % of poor patients pay nothing ()
Buy-One-Give-One / %-of-sales
Marketing benefit of a simple promise, tangible product
Bake the donation cost into the unit price (or accept slimmer margin)
Sliding-scale / Pay-what-you-can
Community services with wide income spread, low marginal cost
Publish a price band and let customers self-select
Yoga or therapy collectives that frame pay-what-you-can as economic-justice practice (, )
Outcome-based (impact contracts, subscriptions)
Funders/governments care more about results than units sold
Price tied to verified outcomes (e.g., jobs kept, CO₂ avoided); often paid in arrears
Social Impact Bonds in workforce training; waste-reduction apps that bill municipalities per tonne saved
Membership / Community Patronage
Mission involves ongoing relationship & advocacy
Tiered dues or “impact subscriptions” unlock content, events, voting rights
Museums’ “pay it forward” memberships; community-owned energy co-ops charging €5/mo to non-local supporters
There are no rows in this table
A step-by-step framework to choose (or mix) models
Table 83
Step
Key actions
Tips & pitfalls
Step
Key actions
Tips & pitfalls
1 — Define double bottom line
Articulate precise financial and impact KPIs (e.g., gross margin ≥ 25 %; 10 000 low-income users served/yr).
Keep no more than 3–4 KPIs or the price logic becomes fuzzy.
2 — Map willingness & ability to pay
Segment by income, urgency, mission-alignment. Use surveys, focus groups, participatory workshops.
Let beneficiary voices co-design tiers to avoid top-down bias.
3 — Calculate true unit cost
Include hidden items: volunteer coordination, certification, impact measurement, depreciation.
Social ventures regularly under-price by ignoring “impact overhead”.
4 — Pick a primary architecture + safety valves
Choose the column above that best matches segments; add a safeguard (e.g., hardship fund, donor pool).
You can run both cross-subsidy and sliding-scale—just keep the narrative simple.
5 — Prototype & learn
Pilot for 4–12 weeks; track uptake, cost recovery and mission KPIs.
Publish data openly; transparency strengthens trust even when you miss early targets.
6 — Iterate pricing story
Fold lessons into a clear narrative: “€1 of every €5 funds free repairs” or “Your premium tier subsidises two low-income members.”
Story has to be the same on shelf, web, investor deck and press release.
There are no rows in this table
Quick reference: matching models to common missions
Table 84
Mission focus
Often-effective model
Mission focus
Often-effective model
Health & education access
Cross-subsidy + outcome contracts
Circular / zero-waste retail
Cost-plus with mission margin + buy-one-give-one for awareness
Community arts & wellbeing
Sliding-scale / membership patronage
Digital public goods
Freemium → subscription for power users; pay-what-you-can donations
There are no rows in this table
Checklist before you launch a new price
Price is never “set & forget” in a social enterprise: it’s a loud lever you’ll pull again and again as markets, costs and impact goals evolve. Treat the process itself as part of the social innovation.
Placement (Distribution): This involves finding the most appropriate places to sell products and choosing the right distribution channels to impact accessibility and visibility. This doesn't only mean physical locations but also websites, catalogues, social media, trade shows, and brick-and-mortar stores. Placement can communicate exclusivity
.
• Promotion (Marketing Communications): This encompasses all instruments used to communicate with target groups and stakeholders to promote products or the company
. It aims to tell a compelling brand story that resonates with consumers. Communication is crucial for conveying a product's value, creating brand awareness and loyalty, and influencing purchasing decisions. Promotion can communicate trendiness
.
Some sources also expand the marketing mix to include additional Ps:
• People: Refers to customers, clients, or the team of employees directly or indirectly involved in the business, including selling, designing, and marketing
.
• Physical Evidence: Pertains to the appearance or tangible aspects associated with the product or service delivery
.
• Process: Describes the delivery of the product or service
.
Marketing aims to reach the "hearts and minds of consumers"
by crafting compelling brand messages and leveraging strategic advertising, pricing, distribution, and promotional strategies
How does a marketing strategy differ from marketing tactics and from an overall business strategy? Why are these distinctions important?
The sources highlight that a marketing strategy is the overarching plan that defines what is to be achieved and why
. It sets the long-term direction, encompassing elements like market segmentation, targeting, and positioning. For example, defining the target group (who to communicate with), advertising objectives (why communicate), and message strategy (what to communicate) are part of the advertising strategy
.
Marketing tactics are the specific, actionable steps or instruments used to implement the strategy. They define how the strategy will be executed
. For instance, choosing specific media, techniques, and channels are tactical decisions within the promotional element of the marketing mix. Sales promotions, for example, are primarily tactical, aimed at increasing short-term sales through temporary incentives. The effectiveness of tactics like value packs in magazines can be measured in the short-term impact on sales
.
The overall business strategy is broader than marketing strategy. It defines the company's long-term goals and how it plans to achieve them across all functions, not just marketing
. Marketing strategy is embedded within this larger business strategy and must be consistent with overall company and marketing objectives. For example, corporate strategy determines and shapes the desired corporate personality, which then influences brand strategy and marketing communications
.
These distinctions are important because:
• Coherence and Consistency: All marketing instruments must work in the same direction and not conflict with each other to ensure the company's offering is consistently marketed
. An integrated approach leads to a "seamless" or homogeneous communications effort
.
• Strategic Direction: The overall business strategy provides the fundamental mission and vision, which marketing strategy translates into consumer-facing plans
. Without a clear strategy, tactics can be random and ineffective, leading to wasted resources
.
• Measurability and Accountability: Clear objectives defined at the strategic level enable the measurement of effectiveness
. Without clear goals, it's impossible to judge whether a campaign has been "good" or "effective". Marketing budgets, for instance, should be based on concrete marketing and communications objectives defined in the communications plan
.
• Adaptability: Understanding the different levels allows for adaptation. For instance, a long-term brand strategy informs creative execution in advertising campaigns
- Does a well-designed marketing strategy cause higher long-term profitability? Through which mechanisms might this relationship operate, and what makes causal evaluation difficult?
Yes, a well-designed marketing strategy is intended to contribute to higher long-term profitability, although this is complex to prove causally.
Mechanisms through which this relationship operates include:
• Brand Building and Equity: Marketing communications are crucial for building and reinforcing brand equity, which is the value added to a product by its brand name
. Strong brands lead to loyal customer bases, increased willingness to pay a premium price, and provide a competitive advantage. Investing in brand awareness, knowledge, and positive attitudes is a long-term goal that results in committed buyers who not only repurchase but also promote the brand through positive word-of-mouth
.
• Customer Loyalty and Relationship Marketing: Moving towards relationship marketing by building customer loyalty is highlighted as a cost-saving strategy, as retaining existing customers can be significantly less expensive than acquiring new ones
. Direct marketing techniques and databases support long-term relationship building and can increase customer share and profitability over time
.
• Competitive Advantage: Effective marketing can lead to differentiation, claiming exclusive "ownership" of a benefit in the customer's mind
. This can make a brand unique and more resilient to competition
.
• Image and Reputation: A positive corporate image creates goodwill, supports attracting crucial people like investors and employees, and can even lessen problems during a crisis
. Public relations (PR), though less directly commercial, builds long-term goodwill and reputation, which lays the groundwork for successful marketing communications
.
Causal evaluation is difficult due to several factors:
• Multiple Influencing Factors: Sales and market share are influenced not only by marketing communications but also by other marketing mix instruments like product quality, design, distribution, and pricing strategies, as well as broader market evolution, technology, and competitive actions
. Isolating the effect of a single element is challenging
.
• Synergy and Interaction: Marketing mix instruments are designed to be mutually reinforcing, meaning their effects are intertwined. For example, a communications plan may yield better results if distribution is optimised or prices are lowered
.
• Time Lag Effects: The commercial payoff of marketing communications often becomes visible only after a certain period, making immediate cause-and-effect difficult to trace
. Sponsorship, for instance, shows its effects on awareness and image building in the long run
.
• External Factors: Sales response models often do not account for the impact of competitive actions and environmental factors
.
• Measuring Intermediate vs. Commercial Results: While "intermediate" effects like brand awareness, knowledge, and attitude are often measured, they are not always good predictors of direct commercial success
.
How has the idea of marketing strategy evolved from the 1950s “4 Ps” era to today’s data-driven, omni-channel approaches?
The fundamental framework of the "4 Ps" (Product, Price, Place, Promotion) has been a cornerstone of marketing for decades
. However, the approach to implementing and integrating these elements has significantly evolved:
• From Mass Marketing to Personalisation: Initially, communication strategies relied heavily on mass media, delivering generalised, transaction-oriented messages
. This has gradually shifted to direct marketing principles, allowing access to individual target group members. Today, there's a trend towards one-to-one marketing and relationship marketing, driven by technology and a focus on increasing customer share rather than just market share
.
• Technological Integration and Data-Driven Approaches: The advent of technology, automation, and database-supported marketing intelligence systems has been crucial
. Databases are considered the "heart of direct marketing," enabling personalised communication and long-term relationship building. There's an evolution from using databases merely as address files to event-driven database marketing, where customer needs are detected and products are offered at the optimal moment
.
• Rise of E-Communications and Omni-Channel: The internet's fast growth, mobile phone penetration, and interactive digital television have transformed media landscapes
. Online marketing is seen as supporting every aspect of a customer's journey, from awareness to sale and after-sales service. This involves using a diverse range of e-marketing tools for various objectives like generating brand awareness, shaping brand image, stimulating trial, and creating loyalty. The goal is a multi-channel customer approach, ensuring consistency across traditional and electronic components
.
• Increased Focus on Consumer Engagement and Interaction: Marketing has moved towards two-way mass conversations with internet users
. Consumers are increasingly in control, deciding what information they want to receive and through which channels. This necessitates a more interactive and adaptive approach from marketers
.
• Shift in Power Dynamics: The market situation has gradually shifted power from manufacturers to retailers, and now increasingly towards the consumer
. This "receiver-directed" environment means marketers must cater to the consumer's decision-making power and "communications literacy"
.
• Strategic Advertising Planning: Advertising is now deeply embedded in the company's overall marketing strategy, aiming at targeted market segments and reflecting the product's positioning strategy
. Research plays a crucial role at every stage of campaign development, from strategic planning to pre-testing and post-testing
- How has the idea of marketing strategy evolved from the 1950s “4 Ps” era to today’s data-driven, omni-channel approaches?
The fundamental concept of the "4 Ps" (Product, Price, Place, Promotion) has remained a cornerstone of marketing since its prominence in the 1950s
. However, its application and the surrounding strategic thinking have undergone significant evolution, driven by technological advancements and shifts in consumer behaviour and market dynamics:
1. From Mass Marketing to Individualised Communication:
• 1950s (and before): Characterised by mass marketing communications, which used mass media to deliver generalised, one-way messages to broad audiences
. The focus was often on pushing products to consumers
.
• Evolution: Gradually, there was an adoption of direct marketing principles, enabling marketers to reach individual members of the target group directly
. This led to a shift from focusing on market share to increasing "customer share" (the quantity and frequency of purchases of each individual customer)
.
2. The Rise of Data-Driven Approaches and Databases:
• Earlier: Marketing decisions were more reliant on intuition and experience
.
• Today: The success of marketing relies heavily on database-supported marketing intelligence systems and automation
. Databases are now considered the "heart of direct marketing". They store personal customer data, transaction history, and communication interactions. This allows for highly selective targeting and measuring campaign effectiveness
.
• Evolution of Database Use: This progressed through stages: from simple address files to product-driven mailings (selecting customers based on test responses), to customer-driven database marketing (targeting customers with relevant products), multi-channel database marketing (optimising sales channels based on customer sensitivity), and finally event-driven database marketing (timing marketing actions to match customers' emerging needs based on life events or interactions)
.
3. Omni-Channel and Interactive Communication:
• Traditional: Communication was largely one-way, with limited feedback mechanisms
.
• Today: The increasing penetration of the internet and mobile phones, and the rise of interactive media like digital television, have led to a trend towards real interactivity
. This means marketers can communicate on a one-to-one basis, and consumers can respond and interact with the sender
.
• Integrated Marketing Communications (IMC): This concept, increasingly important, ensures that communications instruments, traditionally used independently, are combined for a synergistic effect, creating a "seamless" or homogeneous effort
. IMC advocates for coordinating multiple and diverse tools targeted at multiple and diverse audiences. It manages every point of contact between the consumer and the product/organisation
.
• Digital Tools: E-marketing tools now include online advertising, content sponsorship, advergames, viral marketing, e-mail marketing, mobile marketing, online contests, and virtual communities
. Search engine optimisation is crucial for attracting visitors to websites
.
4. Shift Towards Customer-Centricity and Relationship Marketing:
• Traditional: Focus was often on product features and transactional sales
.
• Today: There is a strong emphasis on relationship marketing, aiming to build long-term, mutually beneficial relationships with customers
. This involves understanding customer needs, anticipating future needs, providing customer-oriented solutions, and creating trust. The objective is not just to acquire new customers but to retain existing ones and increase their lifetime value
.
5. Consumer Empowerment:
• Traditional: Manufacturers held more knowledge and control
.
• Today: The balance has shifted, with the consumer becoming the most powerful agent
. Consumers' increased "communications literacy" means they decide what they are exposed to and how they react
.
In essence, while the "ingredients" (4 Ps) remain, the "recipe" for marketing strategy has become far more sophisticated, leveraging technology and data to create personalised, integrated, and long-term customer relationships across diverse channels.
The fundamental framework of the "4 Ps" (Product, Price, Place, Promotion) has been a cornerstone of marketing for decades
. However, the approach to implementing and integrating these elements has significantly evolved:
• From Mass Marketing to Personalisation: Initially, communication strategies relied heavily on mass media, delivering generalised, transaction-oriented messages
. This has gradually shifted to direct marketing principles, allowing access to individual target group members. Today, there's a trend towards one-to-one marketing and relationship marketing, driven by technology and a focus on increasing customer share rather than just market share
.
• Technological Integration and Data-Driven Approaches: The advent of technology, automation, and database-supported marketing intelligence systems has been crucial
. Databases are considered the "heart of direct marketing," enabling personalised communication and long-term relationship building. There's an evolution from using databases merely as address files to event-driven database marketing, where customer needs are detected and products are offered at the optimal moment
.
• Rise of E-Communications and Omni-Channel: The internet's fast growth, mobile phone penetration, and interactive digital television have transformed media landscapes
. Online marketing is seen as supporting every aspect of a customer's journey, from awareness to sale and after-sales service. This involves using a diverse range of e-marketing tools for various objectives like generating brand awareness, shaping brand image, stimulating trial, and creating loyalty. The goal is a multi-channel customer approach, ensuring consistency across traditional and electronic components
.
• Increased Focus on Consumer Engagement and Interaction: Marketing has moved towards two-way mass conversations with internet users
. Consumers are increasingly in control, deciding what information they want to receive and through which channels. This necessitates a more interactive and adaptive approach from marketers
.
• Shift in Power Dynamics: The market situation has gradually shifted power from manufacturers to retailers, and now increasingly towards the consumer
. This "receiver-directed" environment means marketers must cater to the consumer's decision-making power and "communications literacy"
.
• Strategic Advertising Planning: Advertising is now deeply embedded in the company's overall marketing strategy, aiming at targeted market segments and reflecting the product's positioning strategy
. Research plays a crucial role at every stage of campaign development, from strategic planning to pre-testing and post-testing
- Is the modern emphasis on purpose-led marketing strategy beneficial for sustainable growth and societal impact? Justify your position.
Yes, based on the sources, the modern emphasis on purpose-led marketing strategy is presented as beneficial for sustainable growth and societal impact. This is often framed within the context of Corporate Social Responsibility (CSR), also known as "corporate citizenship"
.
Justification:
• Enhanced Reputation and Image: Companies investing in CSR demonstrate actions that further a social good beyond legal requirements or firm interests
. This can build a positive image and reputation, which consumers may reward by purchasing their products. For example, cause-related marketing, where a firm donates a percentage of income to a non-profit cause, can positively impact sales and enhance reputation and brand image
.
• Competitive Advantage and Future-Proofing: Businesses that integrate sustainability into their core strategies and comply with standards like CSRD (Corporate Sustainability Reporting Directive) gain a competitive edge. This appeals to "conscious consumers" and helps "future-proof" the business
. Identifying and reporting environmental and social externalities can address hidden risks, improve stakeholder relationships, and foster innovation, ultimately leading to cost savings and enhanced corporate reputation
.
• Stakeholder Engagement and Accountability: CSR involves integrating social and environmental values into core business operations and engaging with stakeholders to improve societal well-being
. A "double materiality concept" in corporate reporting promotes accountability by combining "inside-out impacts" (company's effects on environment/society) and "outside-in risks" (sustainability-related risks affecting the firm) to offer a comprehensive view and help stakeholders make informed decisions
.
• Employee Loyalty and Motivation: Cause-related sponsorship can motivate and engender loyalty in employees
. For example, a 1999 study showed that 87% of employees in companies with cause-related programs reported strong loyalty to their employer
.
• Ethical Practice as Long-Term Business Interest: Marketing communication professionals are encouraged to act ethically because it serves their best long-term business interest to be perceived as decent corporate citizens sensitive to societal moral codes
. This avoids negative consequences like harm, legal penalties, and loss of competitive advantage from superficial claims
.
In essence, while ethical practices are sometimes seen as conflicting with short-term business interests
, the sources strongly suggest that integrating purpose-led initiatives, such as sustainable practices and ethical considerations, is increasingly vital for long-term business success, brand strength, and positive societal impact
- Which marketing or management theories underpin contemporary strategy design (e.g., Resource-Based View, STP framework)? What predictions do they make, and where do they fall short?
Several theories underpin contemporary marketing strategy design, providing frameworks for understanding consumer behaviour and market dynamics:
1. Segmenting-Targeting-Positioning (STP) Framework:
◦ Description: This is a core element of strategic marketing
. It involves segmenting consumers into homogeneous groups based on needs or reactions to marketing stimuli. Then, targeting involves selecting attractive segments to focus marketing efforts on. Finally, positioning defines a unique and relevant "place in the mind" for products or brands relative to competitors
.
◦ Predictions: STP predicts that by identifying distinct customer groups, tailoring messages, and establishing a clear position, companies can achieve more effective and efficient marketing
. It implies that consumer decisions can be influenced by consistently reflecting a chosen positioning strategy across all marketing tools
.
◦ Shortcomings: While powerful, the sources don't explicitly state shortcomings of the STP framework itself, but rather challenges in its implementation, such as the need for continuous monitoring of consumer perceptions and competitor positions
.
2. Hierarchy-of-Effects Models:
◦ Description: These models, such as DAGMAR (Defining Advertising Goals for Measured Advertising Results), assume consumers go through a hierarchical process of cognitive (think), affective (feel), and behavioural (do) responses to communication stimuli
. Examples include awareness, knowledge, attitude, and intention to buy
.
◦ Predictions: They predict that earlier effects (e.g., awareness) are necessary conditions for later effects (e.g., purchase) to occur
. Marketing communications goals are selected based on the consumer's current stage in this process
.
◦ Shortcomings: A major critique is a lack of empirical support for consumers consistently going through each stage in order
. Significant relations are observed between ad characteristics and recall, or attitudes and purchase intentions, but not necessarily between recall and attitudes. These models often assume a "conversion model" (non-users into users) but advertising often targets experienced consumers. They typically do not allow for interaction between stages (e.g., purchase leading to experience which impacts beliefs)
.
3. Theory of Planned Behaviour (TPB):
◦ Description: This theory suggests that behavioural intention (and thus behaviour) is influenced by attitudes towards the behaviour, subjective norms (perceived social pressure), and perceived behavioural control
.
◦ Predictions: TPB predicts that by changing brand beliefs, attribute evaluations, adding attributes, or influencing perceived social pressure or control, marketers can influence consumers' attitudes and behaviour
. For example, showing how easy a product is to use or emphasizing confidence ("Just do it" by Nike) can influence perceived behavioural control
.
◦ Shortcomings: The sources do not explicitly detail shortcomings of the TPB itself but rather its "explanatory power" when compared with other models
.
4. Elaboration Likelihood Model (ELM):
◦ Description: This model explains how marketing communication persuades consumers, emphasizing that the motivation, ability, and opportunity to process information, as well as the relevance of cognition, affection, and behaviour, affect the impact of information
.
◦ Predictions: Marketers, by being aware of these underlying processes, can choose adequate communication types to influence attitudes towards a brand or company
. It suggests that different models are applicable in different situations for different people and products
.
◦ Shortcomings: No single theory, including ELM, can explain everything, and predicting consumer response remains a complex task
.
5. Information Economics / Behavioural Economics:
◦ Description: Traditional economics assumes rational consumers
, but behavioural economics studies dissonances in behaviour, where what an economic actor does differs from what neoclassical theory suggests they should do. It considers cognitive biases and nudges, emphasizing how information is presented and framed. Information asymmetry can distort purchasing decisions, and communication aims to eliminate this for market transparency
.
◦ Predictions: Better information and framing can lead to more rational purchasing decisions and improved market performance
. However, it also predicts that "nudges" (subtle interventions) can steer individual behaviour in specific directions
.
◦ Shortcomings: The "objective of nudges may overlook the consequences this one may have on consumers' autonomy"
. This raises ethical concerns about conditioning consumers against their freedom and disrupting principles of autonomy and fairness
.
Regarding Resource-Based View (RBV), the sources do not explicitly mention it by name. However, concepts like "unique strengths and weaknesses" of a product
and the emphasis on achieving "sustainable competitive advantage" hint at ideas aligned with RBV, which focuses on leveraging internal resources and capabilities.
- How is the quality or effectiveness of a marketing strategy measured? Discuss key metrics (e.g., CAC : LTV ratio, brand equity scores).
The effectiveness and quality of a marketing strategy are measured through various metrics, often categorized into communication effects and behavioural effects, and assessed at different stages of a campaign or over time
.
Key Metrics and Measurement Techniques:
1. Communication Effects: These are intermediate effects assumed to be predictors of commercial success
.
◦ Brand Awareness: Measured as top-of-mind awareness (TOMA) or aided/unaided recall
. It indicates how strongly a brand is linked to its product category and how easily consumers recall it
.
◦ Brand Knowledge/Comprehension: Assesses if target consumers know essential brand characteristics, features, benefits, and the brand's positioning
.
◦ Brand Attitude/Image: Measures how much a person likes or dislikes a brand, or holds a favourable/unfavourable view of it
. Attitude change or image shifts can be measured using scale techniques
.
◦ Purchase Intention: Gauges the likelihood of a consumer buying a product in the near future
.
◦ Message Processing: Measures whether a message captures attention, appeals, is processed, and remembered
.
◦ Ad-evoked Irritation/Brand Confusion: Advertisers actively try to avoid these, indicating their importance as negative effectiveness metrics
.
2. Behavioural Effects: These relate directly to commercial results.
◦ Sales and Market Share Evolution: The ultimate objectives, though their direct linkage to advertising campaigns can be difficult to isolate
.
◦ Customer Loyalty and Retention: Measured by repeat purchases and the percentage of satisfied, committed buyers
. This relates to the concept of "customer share" (quantity and frequency of purchases per individual customer) rather than just market share
.
◦ Trial Rate: The percentage of target group members who have purchased the brand at least once
.
◦ Adoption Rate: The rate at which new products are adopted
.
3. Brand Equity Scores:
◦ Consumer Brand Equity: Represents the "marketing value" of a brand, measured by factors like brand awareness, product performance, perceived quality, imagery associations, brand feelings, and high brand loyalty
.
◦ Financial Brand Equity: Refers to the financial value of the brand for the company, derived from business earnings attributable to the brand, brand strength, and legal protection
.
4. Profitability and Efficiency Metrics:
◦ Return on Investment (ROI): Assesses the commercial result of marketing spend
. For example, the effect of advertising expenditures on stock price for food advertisers was found to be a cumulative excess return of 2% in one study, though it's often hard to establish a clear link
.
◦ Cost-Effectiveness: Assessed by looking at costs per reached person in mass vs. personal communications
or overall marketing budget efficiency
.
◦ Share of Voice (SOV) vs. Share of Market (SOM): SOV (relative advertising spending) is compared to SOM (market share) to analyze competitive spending and its impact
. Market leaders often have a smaller SOV than SOM, enjoying economies of scale in advertising
.
◦ Lifetime Value (LTV): An important concept in relationship marketing, representing the net present value of profits a company will generate from its customers over time
. This helps determine how much to invest in attracting and retaining customers
.
◦ Customer Acquisition Cost (CAC): While not explicitly mentioned as "CAC:LTV ratio," the sources do discuss that the cost of attracting new customers can be as much as six times greater than retaining existing ones, making customer retention more cost-effective
.
Measurement Procedures:
• Strategic Advertising Research: Involves audits of internal and external communications, competitor analysis, and content research
.
• Pre-testing: Testing advertising stimuli before media placement to assess if they achieve their intended purpose (e.g., creating attention, carrying information, evoking acceptance, purchase intention)
.
• Post-testing: Assessing the impact of advertising tools after they are placed in media
.
• Campaign Evaluation Research: Comparing campaign results with objectives
. This often involves tracking studies that monitor brand position and competitive products over time
.
• Database Marketing: Used to collect and analyze customer data to assess campaign effectiveness and measure response rates
- What factors most influence whether a firm’s marketing strategy becomes more customer-centric over time?
Several key factors influence a firm's marketing strategy to become more customer-centric over time, driven largely by shifts in market dynamics, technological advancements, and evolving consumer expectations:
1. Changing Market Power Dynamics:
◦ Historically, power resided more with manufacturers, then shifted to retailers, and is now increasingly held by the consumer
. This shift means consumers have more control over what information they receive and how they react to it, forcing companies to adopt a more receiver-directed approach
.
◦ Increased Competition and Saturated Markets: In mature markets with many similar products and less brand differentiation, companies must find new ways to stand out
. This pushes them to focus on understanding and satisfying individual customer needs to build loyalty, as opposed to simply pushing undifferentiated products
.
2. Loss of Faith in Mass Media Advertising:
◦ Traditional mass media advertising is perceived as becoming less effective due to "communications clutter" (information overload), increased irritation, and advertising avoidance behaviour by consumers
. This leads marketers to seek more effective tools to attract attention and engage consumers, often through more personalised channels
.
3. Technological Advancements enabling Personalization:
◦ The growth of e-mail, mobile phone penetration, and interactive digital television allows for more individualised and interactive communication
.
◦ The development of databases is critical, enabling the collection of detailed customer information (personal data, purchase history, communication reactions)
. These databases facilitate one-to-one marketing and allow companies to tailor offerings to individual customer needs and preferences
.
◦ "Behavioural advertising" techniques use data to learn about user interests and provide tailored messaging
.
◦ The internet, as a "pull medium," requires consumer action to find information, driving marketers to provide relevant, desired content rather than just interruptive ads
.
4. Emphasis on Relationship Marketing and Customer Loyalty:
◦ There's a growing recognition that retaining existing customers is significantly more cost-effective than acquiring new ones
. This shifts focus towards building long-term relationships and fostering customer loyalty
.
◦ Customer-centric strategies aim to increase "customer share" (quantity and frequency of purchases from each individual) rather than just market share
.
◦ This includes actively listening to consumers to understand their changing tastes and consumption trends
.
5. Desire for Measurable Results and Accountability:
◦ The need for more cost-effective and efficient marketing, coupled with a demand for greater accountability, drives a focus on strategies whose effectiveness can be precisely measured
. Customer-centric approaches, especially those enabled by databases, often provide clearer metrics on individual customer interactions and profitability
.
In summary, the transition to customer-centricity is a direct response to a more empowered, fragmented, and digitally connected consumer base, coupled with the technological capabilities to collect and act on individual customer data to foster long-term relationships and loyalty.
- Describe the effects of a differentiated marketing strategy on market share, price elasticity, and employee alignment.
A differentiated marketing strategy aims to distinguish a company's products or services from competitors' offerings, often by focusing on unique attributes, benefits, or an exclusive image
.
Here are its effects on market share, price elasticity, and employee alignment:
1. Market Share:
◦ Increased Market Share in Targeted Segments: Differentiation allows a company to target specific market segments and aim for a leading position within those niches
. By offering unique value, the company can attract customers who specifically seek those differentiated attributes, potentially gaining a larger share of that particular segment. For example, a small company might target "smaller or less attractive niche segments when competition is strong in the larger segments"
.
◦ Sustainable Competitive Advantage: Successfully differentiating products and brands helps a company to "claim exclusive 'ownership' of a benefit in the mind of the customer"
, making it harder for competitors to imitate. This can lead to a more stable and potentially increasing market share over time by making the brand "unique"
.
◦ Challenges in Saturated Markets: In saturated markets where products are very similar, differentiation becomes crucial because it's hard for consumers to distinguish brands based solely on intrinsic qualities. Marketing communications then need to "make the difference" to attract attention
.
2. Price Elasticity:
◦ Reduced Price Sensitivity: A strong differentiated strategy aims to reduce a product's price elasticity of demand. When consumers perceive a brand as unique, superior, or offering specific benefits that competitors do not, they are generally less sensitive to price changes
. They may be willing to pay a premium price for the perceived added value or quality
.
◦ Protection Against Price Cuts: The regular use of price cuts (e.g., sales promotions) can be "incompatible with building a strong position and a strong brand on the basis of product characteristics or benefits"
. A differentiated strategy tries to avoid competing primarily on price, which can lead to losing margin and profit
.
◦ Risk of Price Dilution: However, frequent use of price promotions can dilute a brand's long-term image and perceived quality, damaging the ability to command a premium price even for a differentiated product
.
3. Employee Alignment (Internal Marketing):
◦ Consistency with Corporate Identity: A differentiated marketing strategy must be consistent with the company's overall corporate identity, mission, and values
. Employees play a crucial role as they are "the company" in many customer interactions
.
◦ Internal Communication and Motivation: To achieve employee alignment, internal marketing is vital. This involves informing, motivating, and training employees about the company's strategic priorities and their role in achieving them
. For a differentiated strategy to succeed, employees must understand and believe in the unique value proposition and be prepared to behave consistently with the desired corporate identity
.
◦ Impact on Brand Experience: In service branding, the motivation and quality of service providers (employees) are crucial for customer satisfaction
. If external advertising claims (e.g., "customer-friendliness") are inconsistent with actual employee behaviour, it can make the entire marketing campaign "completely unbelievable"
. Therefore, employee alignment is essential to deliver on the promises made by a differentiated strategy.
In sum, a differentiated marketing strategy can lead to a stronger, more stable market share by appealing to specific segments, reduce price sensitivity, and requires strong internal alignment of employees to deliver on the brand's unique promise.
- Will AI-augmented personalization dominate marketing strategies over the next two decades? Outline plausible scenarios.
Based on the trends and discussions in the sources regarding data-driven approaches, technological advancements, and the shift towards customer-centricity, it is highly plausible that AI-augmented personalization will increasingly dominate marketing strategies over the next two decades, evolving beyond current practices into more sophisticated and pervasive applications.
Here are plausible scenarios, drawing on the capabilities mentioned in the sources:
Scenario 1: Hyper-Personalized Omni-Channel Experiences (High Dominance)
• Mechanism: This scenario sees AI not just assisting but orchestrating customer interactions across all channels. Leveraging advanced data analytics, AI systems would create highly detailed, real-time "customer profiles" based on past behaviour, preferences, inferred needs, and even emotional states (drawing on concepts of attitude formation and behavioral economics)
.
• Plausible Outcome: Consumers would receive seamless, individualised, and relevant propositions at precisely the moment their needs become prevalent ("event-driven database marketing")
. This extends beyond tailored ads to personalized product recommendations, customised service interactions, and even dynamic pricing based on individual perceived value. Marketing communications would be "more intentional" and "personalised". Companies would proactively "detect and answer customer needs with the right product or service at the right moment, offered through the right channel". This could lead to significantly enhanced customer loyalty and "customer share"
.
• AI's Role: AI would automate the "customer share" increase
, real-time content customisation, predictive analytics for "hot prospects", and even dynamic adaptation of sales approaches based on customer profiles
.
Scenario 2: "Pro-Social" Personalization (Ethically Guided Dominance)
• Mechanism: In this scenario, the dominance of AI-augmented personalization is tempered and guided by strong ethical frameworks, regulations, and a focus on corporate social responsibility. Learning from past concerns about "nudges" overlooking consumer autonomy and potential manipulation
, AI would be designed to enhance consumer well-being and autonomy
.
• Plausible Outcome: Personalization would focus on providing consumers with transparent, accurate, and relevant information that genuinely helps them make informed decisions and achieve their own goals
. For example, AI might personalise health-related food information to help consumers choose healthier options, aligning with "sustainability reasons" or "health reasons" for communication. Regulations like those against "fraudulent, deceitful or grossly misleading information" would be strictly enforced, potentially augmented by AI monitoring. The "opt-in" approach for data collection, already seen as a good environment for permission-based programs, would be standard
.
• AI's Role: AI would ensure "data integrity and transparency in disclosures"
, prevent "superficial claims", and might even flag communication that could "exploit inexperience or lack of knowledge of consumers". This scenario aims for marketing to be "legal, decent, honest and truthful"
in an automated way.
Scenario 3: Niche AI for Specialized Markets (Limited Dominance)
• Mechanism: While AI enhances personalization, its dominance might be more pronounced in specific sectors (e.g., e-commerce, digital services) where data is abundant and interactions are primarily online. In other sectors (e.g., high-involvement B2B sales, luxury goods), human interaction, relationship building, and "old media" might retain significant importance
.
• Plausible Outcome: AI would provide sophisticated insights and tools to human marketers and salespeople, but the final, high-value interactions would still involve human "personal selling"
. AI could identify "hot prospects" and provide sales reps with tailored information for calls, making human interactions more efficient. For technically complex products or services requiring high-involvement decision-making, the personal touch would remain crucial, with AI serving as a powerful support system rather than the primary interface
.
• AI's Role: AI supports "prospecting"
, "pre-call planning", and "customer needs analysis" for human salesforces. It would make sales calls more effective by providing data-driven insights
.
The sources strongly imply a future where digital and personalized approaches, heavily reliant on data and automation (which AI embodies), will be central to marketing. The exact degree of "dominance" will likely depend on ethical considerations, regulatory frameworks, and the specific industry context, but the trend towards increasingly sophisticated, AI-augmented personalization seems inevitable.
- Identify three limitations of current marketing-strategy practice and the externalities (positive or negative) they create.
Based on the provided sources, here are three limitations of current marketing-strategy practice and the externalities they create:
1. Over-reliance on Mass Media Advertising Leading to Communications Clutter and Avoidance:
◦ Limitation: Many marketing strategies have traditionally relied heavily on mass media communications
. However, there's a "widespread belief that mass media communications are becoming increasingly less effective". There is increasing "advertising pressure" which leads to "communications clutter"—an overwhelming amount of information and advertisements
.
◦ Negative Externalities:
▪ Consumer Irritation and Avoidance: Clutter leads to "increased irritation and advertising avoidance behaviour"
. Consumers are less able to attract attention to messages, and advertising is "hardly noticed by the majority of consumers"
. This wastes resources and diminishes the positive experience of consuming media for users.
▪ Brand Confusion: Too much information and clutter can cause "brand confusion," where consumers struggle to distinguish between brands, potentially harming brand loyalty for established companies
. This confusion can sometimes be exploited by smaller companies with "similar products"
.
▪ Increased Costs for Marketers: Mass media is becoming "increasingly expensive" due to more advertisers claiming time and space
. This cost is then often passed onto consumers.
2. Short-Term Focus and Neglect of Long-Term Brand Building/Profitability:
◦ Limitation: Companies are often driven by "short-term orientedness"
. Marketing strategies sometimes prioritize "immediate sales effects" or "short-term profit goals" over patient, long-term investment in brand value. This can manifest in frequent use of sales promotions aimed at immediate sales boosts
.
◦ Negative Externalities:
▪ Brand Dilution and Image Damage: Too frequent promotional actions can give a brand a reputation of "cheapness" and "destroy the perception of its intrinsic qualities"
. Price cuts can reduce quality perception and the potential to command a premium price
. This creates a negative perception for consumers about the quality and value of products.
▪ "Deal-Proneness" and Reduced Reference Price: Consumers may become "deal-prone," always expecting promotions, which can lead to a decrease in their "reference price" for products
. This creates a market where consumers are less willing to pay full price, forcing companies into a cycle of discounts that erode margins.
▪ "Prisoner's Dilemma" and Unstable Market Shares: Frequent promotions often lead to competitors retaliating, resulting in no significant long-term market share changes for anyone, but reduced profitability across the market
. This creates an inefficient market environment.
3. Ethical Concerns in Persuasion, Targeting, and Data Use:
◦ Limitation: Marketing communication is inherently persuasive, but some practices are accused of being unethical, manipulative, or exploiting vulnerabilities
. This includes practices like "nudges" that might overlook consumers' autonomy, "covert marketing techniques such as stealth marketing and buzz marketing" that are deceptive, and "unethical targeting of vulnerable groups" like children
.
◦ Negative Externalities:
▪ Erosion of Consumer Trust and Autonomy: Practices that "exploit inexperience or lack of knowledge of consumers" or mislead through "inaccurate, ambiguous or intended to mislead" claims
erode consumer trust. Nudges that condition consumers "against their freedom" or disrupt "autonomy and fairness"
can reduce a sense of personal agency and control over purchasing decisions.
▪ Creation of Materialistic Culture and Unrealistic Expectations: Marketing is accused of "creating a materialistic culture of conspicuous consumption" and setting "unrealistic expectations"
. This can lead to overspending and dissatisfaction among consumers, fostering societal values centered on consumption rather than other forms of well-being.
▪ Privacy Concerns: Direct marketing, particularly through database use, raises concerns about data governance, privacy, and security
. "Misuse" or "disclosure to third parties" of personal data can lead to consumers feeling their privacy is invaded, potentially resulting in negative reactions or opting out of communications
- Propose four actionable ways companies, regulators, or NGOs could improve marketing strategies to reduce consumer manipulation and environmental harm.
Drawing on the sources, here are four actionable ways companies, regulators, or NGOs can improve marketing strategies to reduce consumer manipulation and environmental harm:
1. Promote and Enforce Ethical Communication Standards beyond Legal Minimums:
◦ Actionable Way: Companies, regulators, and NGOs should actively promote and enforce ethical codes of conduct that go beyond mere legal compliance
. This includes ensuring marketing communications are "legal, decent, honest and truthful". Specifically, this means avoiding anything "likely to cause widespread offence, fear or distress," and refraining from "inaccurate, ambiguous or intended to mislead" claims. Companies should embrace the "caveat venditor" principle, where maximizing consumer satisfaction and well-being is the ultimate aim
.
◦ Mechanism to Reduce Manipulation/Harm: This directly combats deceptive advertising, misleading packaging, and high-pressure selling tactics
. By committing to honesty and transparency, companies build long-term trust and avoid exploiting consumer inexperience or lack of knowledge. Regulators and SROs (Self-Regulatory Organizations) can use their influence (e.g., refusing media for non-compliant advertisers, negative publicity) to ensure adherence
.
2. Integrate "Double Materiality" and Comprehensive Sustainability Reporting:
◦ Actionable Way: Companies, particularly large enterprises, should fully embrace the "Double Materiality Concept" as required by initiatives like the CSRD
. This involves reporting on both "inside-out impacts" (the company's effects on the environment and society, e.g., carbon footprint, social influence) and "outside-in risks" (sustainability-related risks affecting the firm's operations, finances, and reputation). NGOs and regulators can advocate for and monitor the robust implementation of these reporting standards
.
◦ Mechanism to Reduce Manipulation/Harm: This promotes accountability and transparency in a comprehensive way
. By quantifying environmental and social externalities, companies are forced to address "hidden risks" and improve practices, rather than making superficial "greenwashing" claims. This fosters better decision-making for stakeholders, helps identify environmental and social impacts within supply chains, and encourages sustainable practices, directly reducing environmental harm
.
3. Prioritise Customer Autonomy and Ethical Nudging in Data-Driven Personalisation:
◦ Actionable Way: As marketing moves towards AI-augmented personalization, companies and regulators must prioritise consumer autonomy and freedom of choice
. This means ensuring that any "nudges" or steering mechanisms do not "go against their freedom" or disrupt their "autonomy and fairness". Implementing strict "opt-in" policies for data collection, providing clear notice about data usage, respecting user choice and consent for mobile messages, and ensuring data is used to tailor communication to genuine interests are crucial
.
◦ Mechanism to Reduce Manipulation/Harm: This directly addresses the ethical concerns of consumer manipulation inherent in behavioural economics and personalized marketing
. By making data use transparent and empowering consumers with clear opt-in/opt-out options, it ensures personalization serves the consumer's needs rather than coercing them into unwanted behaviours. This helps prevent "filling the whole supermarket with unhealthy products" to overwhelm consumers into unhealthy choices by default
.
4. Invest in Long-Term Brand Building and Relationship Marketing, Reducing Reliance on Short-Term Promotions:
◦ Actionable Way: Companies should shift their marketing budgets and strategic focus from frequent, aggressive short-term sales promotions to long-term brand building and relationship marketing
. This involves consistent investment in brand awareness, knowledge, and image, fostering deep customer loyalty. It also means focusing on retaining existing customers, which is often more cost-effective than constant new customer acquisition
. Regulators can incentivize this shift by, for example, scrutinizing promotional practices that dilute brand value.
◦ Mechanism to Reduce Manipulation/Harm: This reduces the negative externalities associated with short-term practices, such as brand dilution, the creation of "deal-prone" consumers, and the "prisoner's dilemma" of competitive price wars
. By building genuine brand value and loyalty, companies reduce the need for manipulative, low-margin tactics. It encourages a focus on intrinsic product qualities and customer satisfaction over temporary price incentives, which can benefit consumers by promoting higher quality products and stable pricing, indirectly reducing wasteful consumption driven by impulse purchases.
1. Marketing strategy. ChatGPT o3
In brief: A marketing strategy is a long-range plan that specifies which customers a firm will serve, why they should buy, and how scarce marketing resources will be deployed to create defensible advantage. It is distinct from day-to-day tactics and from the firm-level business strategy, yet it links the two. Empirical studies find that well-designed strategies correlate with higher long-term profits, mostly by raising customer lifetime value, brand equity, and pricing power, though proving strict causality is hard. Since the 1950s the field has shifted from product-centric “4 Ps” toolkits to data-rich, omni-channel, purpose-led, and increasingly AI-augmented approaches. Below are the essentials, limits, and future directions—plus concrete fixes to curb manipulation and ecological harm.
Definition & Core Elements
Strategy vs Tactics vs Business Strategy
Table 62
Layer
Time horizon
Main question
Example
Why distinction matters
Layer
Time horizon
Main question
Example
Why distinction matters
Business strategy
3–10 yrs
Where do we play?
“Enter EU energy-storage market”
Sets corporate scope and financial targets
Marketing strategy
1–3 yrs
How will we win customers at attractive economics?
“Target eco-conscious homeowners with subscription battery leasing”
Guides coherent resource allocation
Marketing tactics
Days–months
What actions execute the plan?
“Run TikTok ads in Berlin this week”
Agile tests without losing strategic focus
There are no rows in this table
Tactics without strategy waste budget; strategy without tactics never ships (, ).
Link to Long-Term Profitability
Historical Evolution
Purpose-Led Strategy: Benefit or Hype?
Theoretical Foundations & Their Limits
Table 63
Theory
Key prediction
Shortcomings
Theory
Key prediction
Shortcomings
Unique, hard-to-imitate resources → advantage
Vague resource definitions; underplays market turbulence
Precise targeting raises relevance & ROI
Privacy regulation and micro-segment fatigue
Customer, competitor, and inter-functional focus ↑ profitability
Causality & time-lag issues
Differentiation economics
Unique positioning enables premium pricing
In commoditized digital markets, imitation cycles erode gains
There are no rows in this table
Measuring Strategy Quality
Toward Customer-Centricity
Shifts occur when:
Differentiated Strategy Effects
Will AI-Augmented Personalization Dominate? (2025-2045)
Table 64
Scenario
2030
2045
Scenario
2030
2045
Baseline adoption
60 % of spend algorithmically optimized; GenAI assists creative (, )
Near-real-time “personal operating systems” for commerce
Regulated moderation
EU/US privacy rules cap micro-targeting, favoring cohort models
AI used mainly for product R&D, not 1:1 ads
AI-first disruptors
Synthetic personas test campaigns; human oversight minimal
There are no rows in this table
Current Practice: Three Key Limitations & Externalities
Table 65
Limitation
Negative externality
Limitation
Negative externality
Privacy loss; addictive consumption
Algorithmic echo-chambers
There are no rows in this table
Four Actionable Improvements
Sources Used
AMA (turn2search0, turn2search9), SmartInsights (turn0search9, turn1view2), ScienceDirect & Wiley studies (turn3search1, turn3search8), Emarsys blog (turn0search3), UN Global Compact (turn0search4), Saviom RBV (turn0search5), HBS Online (turn1view3), Interbrand (turn4search1), HBR (turn6search3), McKinsey (turn5search0), Deloitte (turn5search1, turn5search4), FTC report (turn8search2), UNSDG Greenwashing (turn8search1), BEUC complaint (turn8news28), dark-pattern ethics (turn8search0), differentiation analytics (turn6search1), strategic alignment study (turn6search2), MMM ROI (turn7search1), NPS sources (turn7search0), Cannes Lions trend note (turn5news30).
1. Marketing strategy. ChatGPT Deep Research
What Is a Marketing Strategy? Definition and Core Elements
A marketing strategy is essentially the high-level game plan by which a business intends to reach and persuade its target customers. Philip Kotler defines marketing strategy as “the way in which the marketing function organizes its activities to achieve a profitable growth in sales at a marketing mix level”. In simpler terms, this means using research to identify the right combination of product, price, place, and promotion (the classic “4 Ps”) that will satisfy target customer needs and yield optimal profit. Core elements of a marketing strategy typically include:
A well-crafted marketing strategy is research-driven and comprehensive, providing a unifying framework for all marketing initiatives. For example, it will be informed by customer insights (needs, demographics, behaviors), competitive analysis, and the company’s own competencies. Importantly, a marketing strategy should articulate how it will achieve a sustainable competitive advantage – i.e. why customers will prefer your offering over others in the long run. It often spans a longer-term planning horizon (several years), guiding consistent decision-making and resource allocation across campaigns and channels.
Strategy vs. Tactics vs. Business Strategy – Key Differences
It’s crucial to distinguish marketing strategy from marketing tactics and from the broader business (corporate) strategy. In brief, strategy is the overarching “what and why,” while tactics are the specific “how”. According to marketing expert Dave Chaffey, “Strategy dictates the marketing activity needed to achieve your business goals and vision, whereas tactics – the detail of the strategy – answer how exactly that will happen.” A marketing strategy defines long-term goals, target markets, and positioning; marketing tactics are the concrete actions and campaigns executed to implement that strategy (e.g. particular advertisements, social media posts, promotions, etc.).
Marketing strategy vs. business strategy: The business (or corporate) strategy is higher-level and encompasses the company’s overall direction, including which markets or product lines to be in, major growth objectives, and how all functions (not just marketing) will contribute. The marketing strategy is a subset that focuses specifically on how to win and keep customers in those chosen markets. In other words, business strategy defines “what business are we in, what are our goals, and what is our value proposition at the company level,” while marketing strategy outlines “how we will attract, engage, and satisfy customers in support of that overall mission.” For example, a company’s business strategy might be to expand into sustainable food products globally, while the marketing strategy would detail how to position those products to eco-conscious consumers, which channels to use, and how to differentiate from competitors.
These distinctions are important because conflating strategy and tactics can lead to poor planning. Without a clear strategy, companies often jump straight to running isolated marketing campaigns that lack coherence. Research indicates many businesses lack a clear marketing strategy, resulting in scattershot tactics that “may be poorly directed…not propelling the business in the direction needed.” Similarly, failing to align marketing strategy with the broader business strategy can cause inconsistent messaging or missed opportunities. For instance, if the business strategy prioritizes premium brand positioning but the marketing tactics push heavy price discounts, there’s a disconnect. Separating the terms helps ensure strategic alignment (marketing efforts supporting big-picture goals) and effective execution (tactics that make sense given the strategy). As one strategist put it: “A real strategy involves a clear set of choices of what the firm is going to do and what it’s not going to do” – distinguishing strategy from mere wishful thinking or ad-hoc actions. When companies respect these differences, they devote time to strategic planning (the “why and who” decisions) before diving into tactical marketing “to-dos,” which leads to more consistent branding and better use of resources.
Does a Good Marketing Strategy Increase Long-Term Profitability?
There is strong evidence that a well-designed marketing strategy correlates with superior long-term financial performance, though proving direct causation is challenging. Classic research from the PIMS (Profit Impact of Market Strategies) program in the 1970s found that certain marketing strategic factors – notably market share and product quality – are associated with higher ROI. In fact, one famous finding was that companies with high market share were generally far more profitable than smaller-share rivals. This suggests that strategies aiming to build market share (e.g. through differentiation or superior value) can lead to economies of scale and greater profit. Similarly, firms that invest in brand equity and customer loyalty often enjoy price premiums and repeat business, boosting profitability over time. The ultimate goal of marketing strategy is to earn a sustainable competitive advantage that yields long-run profits – for example, a strong brand or proprietary customer data that competitors cannot easily replicate.
Mechanisms: A sound marketing strategy can drive long-term profits through several mechanisms: (1) Customer loyalty and Lifetime Value: By truly meeting customer needs and delivering superior value, a firm encourages repeat purchases and higher customer lifetime value. Loyal customers are cheaper to retain and often refer others, feeding a profit cycle. (2) Differentiation and pricing power: A differentiated strategy (unique product/features or brand) makes demand more inelastic – loyal customers will pay higher prices and are less price-sensitive, supporting higher margins. (3) Efficiency of marketing spend: A clear strategy focuses resources on the best opportunities (right channels, right segments), avoiding wasted spend. Over years, this improves marketing ROI. (4) Brand equity: Strong brands built via consistent strategy confer goodwill that translates to premium pricing, lower acquisition costs, or insulation in downturns – all profit enhancers. (5) Strategic adaptability: A thoughtful strategy includes monitoring and responding to market changes, which helps avoid profit-eroding surprises and capitalize on emerging trends.
Causality challenges: However, it is difficult to prove causation because many external and internal factors influence profitability. Companies that perform well financially may simply have more resources to invest in great marketing (reverse causality), rather than the marketing strategy causing the performance. One recent study found that higher profitability (ROA) actually had a significant effect on shaping a firm’s marketing strategy, rather than the strategy driving profitability. Moreover, superior marketing often coincides with other strengths (quality products, good management), so isolating its unique impact is hard. The business environment also plays a role: for example, a well-designed strategy might still falter due to a recession or disruptive competitor. Measuring long-term effects is tricky – strategies unfold over years, and it’s rarely feasible to run controlled experiments on strategy. We mostly have to rely on correlational studies and case histories.
That said, overwhelming industry experience supports that strategic, customer-centric marketing pays off in the long run. Companies like Apple or Coca-Cola, which have invested in brand-building and innovative marketing strategies for decades, reap enduring profits and market leadership. Empirical evidence indicates that neglecting long-term marketing has tangible costs. Nielsen research in 2023, for instance, showed that if a brand cuts its advertising for a prolonged period, it loses future revenue and takes 3–5 years of sustained brand-building effort to recover the lost ground. Short-term sales tactics (like heavy price promotions) can even undermine long-term profitability: promotions were found to deliver only about half the long-term ROI of brand media spending, because constant discounts train consumers to wait for deals and erode pricing power. In summary, a well-crafted marketing strategy tends to yield higher long-run profitability through stronger customer loyalty, pricing advantages, and efficient growth – but proving a direct causal link is complicated by external variables and the difficulty of disentangling marketing’s effect from other business factors. Savvy firms focus on strategic marketing as a long-term investment, despite the measurement challenges, because the risk of not doing so (brand atrophy, customer churn, etc.) is too high.
Evolution from the “4 Ps” Era to Data-Driven, Omnichannel Marketing
Marketing strategy has evolved dramatically from the mid-20th century to today. In the 1950s and 1960s, the prevailing framework was the “4 Ps” of marketing (Product, Price, Place, Promotion), introduced by E. Jerome McCarthy and popularized by Kotler. Back then, marketing was relatively simple and product-centric. As Kotler recounts, a 1960s company would more or less: “Decide the product’s features and set the price, secure a strong position in distribution channels, hire an agency to create ads, and run a sales force”. Strategy in that era was often about optimizing this marketing mix for mass markets – think of the classic mass advertising on the three TV networks, setting list prices with annual adjustments, and pushing product through physical retail channels. The focus was on production and distribution: making good products and maximizing reach. Consumer data was scarce, and segmentation was rudimentary. The marketer’s toolkit revolved around print, radio, and TV ads, basic demographic segmentation, and the sales force’s intuition.
Starting in the 1970s and especially by the 1980s, marketing strategy began shifting toward a customer-centric and strategic planning approach. Concepts like STP (Segmentation, Targeting, Positioning) arose, encouraging firms to identify distinct customer segments and craft positioning strategies for each (moving beyond one-size-fits-all mass marketing). The 1980s and 90s saw the rise of relationship marketing and CRM, as brands realized the value of retaining customers and building lifetime relationships (loyalty programs, database marketing). Academic and analytical rigor increased – marketers adopted quantitative methods (e.g. conjoint analysis, CLV calculations) and consumer behavior theories, making marketing more of a science than the art of the Mad Men era. The marketing concept – that the whole firm should be oriented to satisfying customer needs – became widely accepted, supplanting the old product-centric mindset.
Digital revolution (1990s–2010s): The advent of the internet and digital media upended marketing strategy yet again. By the late 90s and 2000s, marketers had to integrate online channels (websites, email, search engines) alongside traditional channels. This era introduced unprecedented data-driven marketing. Companies moved from relying on broad market research to collecting data on individual customers’ behaviors and preferences in real time. The emergence of e-commerce and social media meant consumers could be reached and engaged 24/7, globally. Marketing strategy evolved to an omnichannel approach – ensuring a seamless customer experience across online and offline touchpoints (store, website, mobile app, social media, etc.). The 4 Ps still mattered, but they expanded (some talk about 7 Ps or 4 Cs) and became more dynamic. For example, “Place” now includes digital distribution; “Promotion” now spans content marketing, influencers, and programmatic ads.
In today’s environment, data and personalization are king. Marketers leverage big data, machine learning, and marketing automation to tailor offerings and messages at the individual level, not just for broad segments. Kotler notes that companies have gone from segment-level information to “collecting information on individual customers” and using machine learning to derive insights for customization and one-to-one targeting. The strategy is often “always-on” and iterative – using analytics dashboards with metrics like click-through rates, conversion rates, and customer journey analytics to constantly refine campaigns. Another hallmark of the modern era is omnichannel integration: marketers strive to meet customers wherever they are – whether that’s on TikTok, in a physical store, via a voice assistant, etc. – with a consistent message. Real-time responsiveness is another shift: Whereas 1960s marketers ran fixed campaigns for months, today’s marketers can tweak a digital campaign in hours based on live data.
From “push” to “pull” and purpose: Additionally, the evolution includes a shift from heavy reliance on outbound “push” advertising to inbound or content-driven “pull” marketing. Modern strategies often include content marketing, SEO, and thought leadership to attract customers organically. The role of brands in society has also evolved – today there is an emphasis on purpose-led marketing and authenticity, reflecting consumer expectations that brands stand for values. In summary, the journey from the 4 Ps era to now has taken marketing strategy from a product-focused, mass-market, intuition-driven practice to a customer-focused, data-and-technology-powered discipline. The core idea of delivering value to customers remains, but the strategies now leverage analytics, personalization at scale, and omnichannel engagement. A company in the 2020s might use AI-driven algorithms to decide personalized product recommendations and dynamic pricing for each customer – a far cry from the static, one-message-for-all approach of the mid-20th century.
Kotler encapsulated this evolution by noting that in the 1960s marketing was easy to grasp and mostly about executing the 4 Ps, but “over time, marketing grew more sophisticated and scientific,” requiring quantitative skills and continual learning. Today’s marketers navigate a complex landscape of digital platforms and consumer touchpoints, guided by data. Yet, they also integrate lessons from the past (segmentation, branding fundamentals) with new priorities (customer experience, ethics, sustainability). The best strategies blend the timeless principles of understanding customer needs and delivering unique value with cutting-edge tools like AI analytics and omnichannel delivery to meet those needs in real time.
Purpose-Led Marketing Strategy – Beneficial for Sustainable Growth?
In recent years, there’s been a strong push for purpose-led marketing – where brands articulate and operate around a broader social or environmental mission (their “purpose”) beyond pure profit. Is this modern emphasis beneficial for sustainable growth and societal impact? In many ways, yes – if done authentically. A genuinely purpose-driven marketing strategy can create a win-win: driving long-term business success while also delivering positive outcomes for society and the planet. However, it must be executed sincerely; otherwise it can backfire.
Benefits to sustainable growth: Brands with a clear, authentic purpose often enjoy stronger customer loyalty, differentiation, and resilience. Consumers (especially younger generations) increasingly favor brands whose values align with their own. For example, a Kantar study found that purpose-driven brands grew at twice the rate of others – 175% brand value growth over 12 years vs 70% for brands lacking a strong purpose. When a company stands for something meaningful (like sustainability, health, social justice), it can deepen the emotional bond with consumers, leading to repeat business and advocacy. This translates to revenue growth that is more sustainable long-term (not just transactional). Purpose can also guide innovation – a company focused on an environmental mission will seek new sustainable products, opening new markets and keeping it ahead of regulatory or consumer trends. Internally, a purpose-led strategy can galvanize employees and partners; employees derive motivation and pride from working towards a cause, boosting productivity and retention (indeed, about 75% of employees expect their employer to take a stand on current issues). All these factors can improve a firm’s long-run performance and adaptability – arguably making growth more sustainable in the literal sense (financially stable and socially responsible).
From a societal perspective, purpose-led marketing can harness the immense reach and creativity of marketing to drive positive change. We’ve seen brands run campaigns to normalize body positivity, promote recycling, improve public health (e.g. wellness apps encouraging fitness), and so on. When such campaigns are more than lip service – backed by changes in the company’s operations – they can contribute to societal well-being. For instance, a food company marketing a purpose of “healthier communities” might reformulate products to reduce sugar and invest in nutrition education, tangibly benefiting public health. Purpose-led strategies often align with sustainable development goals, meaning the marketing budgets partly act like social innovation funds. There’s also a reputational effect: companies embracing purpose can influence peers and industries (a kind of positive externality). If one big apparel brand successfully markets itself on fair labor practices and gains market share, competitors may follow suit to avoid losing customers, thereby raising industry standards.
Cautions and criticisms: On the flip side, the rise of “brand purpose” has brought a lot of purpose-washing – empty rhetoric not matched by action. Consumers have become wary of brands that suddenly wrap themselves in a cause du jour without credible commitments. Purpose has gone from a buzzword to something make-or-break; people are quick to “pick apart” brands in comment sections to see who’s genuine and who’s just riding the trend. If a brand touts its eco-friendliness in ads but is revealed to be a big polluter in practice, the backlash can damage trust more than if they said nothing. Thus, purpose-led marketing is beneficial only when the company’s behavior legitimately supports the marketing messages.
There’s also the question of focus: A business still must deliver quality and value. A poorly executed core product won’t be saved by purpose branding. Some critics argue that over-emphasizing purpose can distract from fundamentals or lead to political entanglements that alienate segments of customers. However, surveys indicate most consumers appreciate brands taking stands on issues (e.g. 94% of Gen Z believe brands should address social and environmental issues), so the risk of alienation may be lower than the risk of appearing indifferent or inauthentic.
In terms of sustainable growth, a purpose-driven approach tends to favor long-term thinking (since social/environmental goals are inherently long-term), which can help companies avoid shortsighted decisions. For example, a purpose-led emphasis on sustainability might steer a company to invest in eco-friendly materials that are initially costlier but future-proof the brand against regulatory or resource shocks. Financially, numerous studies (e.g. the Stengel 50 index of high-purpose brands) have shown purpose-led companies outperform stock market averages. This suggests a correlation between authentic purpose and sustained financial success, likely because of the trust, loyalty, and brand differentiation those companies build.
Societal impact: When done well, purpose-led marketing can indeed be beneficial for society. Campaigns like Dove’s “Real Beauty” or Patagonia’s environmental activism both sold products and advanced conversations about self-image and conservation. Purpose-led brands often invest in communities (e.g. TOMS Shoes donating footwear, or Bombas donating socks) as part of their strategy, creating positive externalities. Additionally, marketing with purpose can normalize certain behaviors – for instance, an outdoor apparel brand promoting a “get outside” purpose might incidentally improve public health by encouraging exercise.
In conclusion, a modern purpose-led marketing strategy can be a powerful force for sustainable growth and positive social impact – it helps companies connect deeply with values-driven consumers, differentiate beyond price, and future-proof their business, while also tackling societal challenges. But the strategy must be genuine, substantive, and integrated into the business model (not just a marketing slogan) to realize these benefits. When purpose is authentic, the brand’s success and societal well-being become mutually reinforcing: the better the company does, the more good it can do, creating a virtuous cycle.
Theoretical Foundations of Contemporary Marketing Strategy (RBV, STP, etc.)
Modern marketing strategy is underpinned by several key theories and frameworks from marketing and strategic management. These theories provide lenses for understanding how to create and sustain competitive advantage in the marketplace. Here we discuss a few major ones – Resource-Based View (RBV), STP (Segmentation-Targeting-Positioning), and others like Porter’s Generic Strategies – including what they predict and where they fall short.
Other notable frameworks include the Marketing Orientation/Market-Driven theory, which posits that firms that are more customer and market-oriented (continuously gathering market intelligence and responding to customer needs) outperform others. This is supported by studies showing market-oriented companies tend to have higher innovation and ROI. The limitation there is if customers themselves don’t know what they will want (as in disruptive innovation cases), a pure customer-led approach can miss big shifts (the classic “marketing myopia” problem). Additionally, concepts like Blue Ocean Strategy urge companies to seek untapped market spaces rather than competing head-on – predicting high profit if you can create a “blue ocean” of your own. Its shortcoming is that blue oceans eventually attract competitors and not every company can find one.
In practice, contemporary marketing strategists blend these theories. For example, a firm might use STP to find a attractive segment, apply RBV to leverage an internal strength (say, a patented technology) to serve that segment, and aim for a differentiation strategy to build brand loyalty. Each theory contributes: STP ensures customer focus, RBV ensures the strategy is built around something competitors can’t easily match, and Porter’s framework ensures the firm knows how it’s positioning relative to cost/quality. Being aware of the limits, marketers now also account for agility and continuous innovation (since static advantages are fleeting in fast-moving markets). They also consider behavioral economics and psychological theories (recognizing consumers don’t always behave “rationally”, which traditional strategy assumed) – leading to strategies that incorporate storytelling, behavioral nudges, etc., beyond what these classical theories explicitly cover.
Measuring Marketing Strategy Effectiveness: Key Metrics
Determining whether a marketing strategy is working requires looking at both financial outcomes and brand/customer health metrics. Companies today use a mix of metrics to gauge the quality and effectiveness of their marketing strategy. Here are some of the most important ones:
Ultimately, no single metric tells the whole story, so dashboards combining multiple metrics are used. For example, a CMO might look at: quarterly sales and market share, marketing spend vs budget, CAC:LTV ratio, NPS score, brand awareness levels, and digital engagement stats – each illuminating a facet of performance. Key is alignment: the metrics chosen should tie to the strategy’s objectives. If the strategy is to be a premium brand, then margins, NPS, and brand equity metrics might be weighted more. If the strategy is aggressive growth, market share and CAC/LTV might be paramount. By monitoring these indicators, companies can adjust their marketing strategy – doubling down on what works (e.g., a high-NPS segment) or fixing what doesn’t (e.g., if CAC is too high in a certain channel, refine targeting or messaging). For instance, if LTV:CAC drops below the desired threshold, it’s a warning that either acquisition costs are rising or customer value is falling – prompting a strategic review of targeting, channel mix, or customer experience improvements. Or if brand awareness remains low despite heavy advertising, perhaps the creative positioning isn’t breaking through, indicating a need to tweak the message.
In conclusion, measuring marketing strategy effectiveness requires a balanced scorecard of metrics, capturing both short-term results and long-term brand/customer equity. Financial metrics like CAC:LTV and market share show outcomes of strategy, while brand health metrics like awareness, NPS, and satisfaction indicate if the strategy is building a foundation for future profitability. The best companies keep an eye on both – for example, using NPS as a leading indicator for growth (since promoters drive referrals, etc.) and CAC:LTV as a sanity check on profitability of growth. By doing so, they ensure the marketing strategy is not only delivering quarter-by-quarter, but also creating durable value.
Drivers of Increasing Customer-Centricity in Marketing Strategy
Many firms are on a journey to become more customer-centric – meaning they put the customer’s needs and experience at the center of their strategy decisions. Several key factors influence whether and how a company’s marketing strategy becomes more customer-centric over time:
1. Leadership and Corporate Culture: Perhaps the most important factor is top management’s commitment to customer orientation. If the CEO and CMO champion a customer-first vision, it cascades through the organization. A company truly serious about customer-centricity “must anchor it in its entire corporate strategy…all departments – from sales and marketing to production and service – consider customer needs their top priority.” This broad mandate often requires cultural change led from the top. Leaders need to model behaviors (e.g., visiting customers, talking about customer satisfaction in meetings) and set incentives that reward customer-focused outcomes rather than just short-term sales. When management explicitly makes customer satisfaction a key performance indicator and empowers employees to do the right thing for customers, the strategy naturally shifts to be more customer-driven. Conversely, if leadership is purely finance- or product-focused, customer-centric initiatives struggle to take root.
2. Organizational Structure and Silos: Firms that break down internal silos tend to become more customer-centric. Traditionally, companies were organized by product or function, which can create fragmented experiences (each department worrying about its own targets). Moving toward cross-functional teams oriented around customer segments or the customer journey is a big enabler of customer-centric strategy. For example, some companies establish a Chief Customer Officer role or dedicated customer experience teams that work across marketing, support, product, etc. Having unified customer data platforms accessible to all departments also helps – it ensures everyone is looking at customer feedback and behavior data when making decisions. The old saying “what gets measured gets managed” applies: if the organization starts measuring things like customer satisfaction (CSAT), Net Promoter Score, or customer lifetime value by segment, it encourages all areas to improve those metrics, thus aligning them around the customer.
3. Feedback Mechanisms and Market Intelligence: A major driver of increasing customer-centricity is the ability to actively listen to customers. Companies that invest in constantly collecting and analyzing customer feedback – through surveys, social media listening, reviews, usability testing, etc. – inevitably become more attuned to customer needs and can adjust strategy accordingly. As one guide notes, “the collection and evaluation of customer feedback is a key success factor in constantly improving service and meeting customer requirements.” Over time, robust Voice-of-Customer programs can shift a firm’s mindset from inside-out (“we assume we know what’s best”) to outside-in (“the customers guide us”). Additionally, competitive pressure and market changes often reach a company via customer intelligence: for example, if customers start complaining that a competitor’s app is easier to use, it can spur the firm to up its game. Data and analytics technology have made this easier – firms now have CRM systems and AI tools to glean insights from vast customer data. Those that leverage these tools effectively find it natural to let customer preferences drive segmentation, personalize communications, and even co-create products, deepening customer-centricity.
4. Technological Enablers (Personalization and CRM): The rise of AI and personalization technologies has made customer-centric strategies both more feasible and more expected by consumers. Personalization means you respond to the individual’s needs – a fundamentally customer-centric approach. Companies that adopt personalization (product recommendations, targeted content, one-to-one marketing emails) often reorganize around customer data and journeys. For instance, implementing a recommendation engine requires understanding individual behavior and crafting strategy around delivering value to that individual. Over time, using these tools trains the organization to continuously tailor and improve experiences for customers. A company might start personalizing as a tactic, but soon it affects strategy: you begin segmenting markets at a finer grain, offering more flexible product options, etc., all of which center on customer wants. In addition, the ubiquity of digital channels means customers can easily voice dissatisfaction or switch if not served well – technology raises the stakes for being customer-centric. Social media feedback is very public, so ignoring customer needs becomes reputationally dangerous. This dynamic pushes firms toward more responsive, customer-focused strategies.
5. Market Competition and Empowered Consumers: Over time, many industries become more competitive and saturated. When products become commoditized, the quality of customer experience becomes a key differentiator. Companies then have a strong incentive to shift strategy toward customer-centric innovations (like superior service, customization, loyalty rewards) to stand out. Furthermore, consumers today are more empowered – they have more choices and more information (through online research and reviews). They expect better treatment and can easily defect if unhappy. This empowerment, coupled with rising consumer expectations, forces companies to evolve or risk losing relevance. For example, in the food sector, consumers now demand transparency (about ingredients, sourcing, environmental impact). Food companies have had to adapt marketing to be more honest, interactive (answering questions, telling origin stories) and health-conscious – all reflecting a more customer-driven approach rather than simply pushing legacy products. If one firm in an industry becomes notably customer-centric and wins loyalty (say, an airline known for remarkable customer service), others often follow to avoid losing customers – a competitive domino effect that can raise the whole industry’s customer orientation.
6. Internal Incentives and Skills Development: Sometimes a firm’s strategy becomes more customer-centric because it changes how it rewards and trains its people. If you start tying bonuses to customer satisfaction metrics or Net Promoter Score, employees from front-line staff up to executives pay more attention to customer outcomes. Training programs that build customer empathy (e.g., having corporate staff spend a day handling customer service calls) can shift perspectives. Over time, organizations that hire and promote for customer-centric skills (like empathy, listening, problem-solving for customer issues) will naturally develop strategies that prioritize customer experience.
In summary, a firm’s marketing strategy evolves to be more customer-centric when structural, cultural, and external forces align in that direction. Leadership sets the tone and strategic priority, often declaring “the customer is at the center of everything we do.” They back it up by embedding customer focus into corporate strategy and values. Then, enabling factors like technology (CRM systems, data analytics), processes (regular customer feedback loops), and cross-functional teamwork turn that philosophy into day-to-day practice. Meanwhile, the external environment – empowered customers and stiff competition – makes customer-centricity not just a nice-to-have but a survival imperative. Companies that successfully transform in this way often see benefits: improved customer satisfaction and loyalty, more effective marketing (since it’s based on real insights), and innovation that is aligned with what customers actually want. Those that fail to move toward customer-centric marketing may find themselves out of touch and losing market share to more responsive competitors.
Impacts of a Differentiated Marketing Strategy: Market Share, Price Elasticity, Employee Alignment
A differentiated marketing strategy is one where a company offers a distinct value proposition (unique features, brand image, quality, etc.) that sets it apart from competitors, often targeting specific segments rather than the mass market. Adopting such a strategy has several notable effects:
In summary, a differentiated marketing strategy tends to yield lower market share percentage than a mass-market cost leader might have, but a more secure and profitable share comprised of loyal customers. It grants the firm pricing power by reducing price elasticity, as customers are willing to pay more for the unique value. And internally, it often unifies and motivates employees, as they have a clear vision to get behind, which can further reinforce the quality of customer experience (creating a virtuous cycle where engaged employees deliver on the brand promise, which delights customers and strengthens the differentiation). Of course, the magnitude of these effects depends on how truly differentiated the offering is and how well the company communicates and lives the differentiation. But these are general observed effects of pursuing differentiation as a marketing strategy.
The Future: AI-Augmented Personalization Dominating Marketing Strategies?
The next two decades will undoubtedly bring even more advanced AI-driven personalization in marketing – but whether it will dominate all marketing strategies or face limits is a matter of scenario planning. We can envision a few plausible scenarios:
Scenario 1: AI-Driven Personalization Becomes Ubiquitous and Dominant – In this optimistic/tech-forward scenario, AI-augmented personalization is the standard for all major marketing. By 2040, companies use AI to analyze massive datasets (purchase history, browsing behavior, IoT signals, etc.) and deliver “segment of one” marketing in real time. Every customer interaction is hyper-personalized: the content you see, the product recommendations you get, even the prices or promotions are tailored by AI to maximize relevance and engagement. Marketing strategies are largely built around harnessing AI to predict individual customer needs and respond instantly. This scenario is supported by experts who say AI will enable “even more personalized marketing strategies, tailoring ads and content to individual preferences at an unprecedented scale.”. We might see AI algorithms not only choosing which ad to show, but actually creating content on the fly for each user (leveraging generative AI). For example, an AI might generate a custom video ad featuring your favorite celebrity and referencing something you personally care about. The customer experience would be highly seamless: AI could manage customer journeys so that each person feels the brand “gets” them – from chatbots that offer instant, context-aware service, to shopping sites that rearrange themselves to suit each user. This scenario likely leads to very efficient marketing spend (no waste on irrelevant ads) and could improve customer satisfaction if done right (since people get more useful, interesting info instead of spam). AI might also open new channels like personalized virtual reality experiences or AI-driven interactive agents that act as personal shopping assistants. In short, marketing strategy in this world is heavily tech-centric: the chief marketing officer might as well be a chief data officer, and success is determined by whose AI better predicts and influences consumer behavior.
However, even in this scenario, there are challenges (which are touched on below) – but assuming companies and regulators navigate them, AI personalization could indeed dominate because of the clear economic incentives (more relevance usually means better ROI). We’re already seeing steps: for example, programmatic advertising and recommendation engines are early forms of AI personalization dominating digital marketing.
Scenario 2: AI Personalization Grows but is Balanced by Privacy Regulations and Human Touch – In this scenario, AI plays a huge role but not without constraints. By the 2030s, we have widespread AI personalization, but governments and public opinion have pushed back enough to regulate and moderate its use. Concerns over privacy, manipulation, and the “creepiness” factor lead to strong laws on data usage. Perhaps something like an expansion of GDPR globally means consumers have to opt-in for deep personalization, or are given easy ways to see and control how AIs target them. We already see moves in this direction: the EU’s Digital Services Act and other regulations ban manipulative dark patterns and emphasize user rights. If such trends continue, by 2040 marketing strategies will still use AI heavily (because it’s too efficient and effective to ignore), but they will do so in a transparent, permission-based way. For example, companies might provide value in exchange for data (like loyalty programs do) and clearly explain personalization benefits. There may also be consumer segments who prefer less personalization, and strategies will adapt to that (offering a more generic or privacy-preserving option). The personalization will also be softer – e.g., segment-based rather than individual-based in some cases – to avoid crossing privacy lines. Importantly, companies may differentiate on ethics and trust: one brand’s strategy might be “we use AI to help you, but never exploit your data or violate your trust,” appealing to more cautious consumers. Additionally, the human element might make a comeback in some areas: for instance, AI might handle routine interactions, but companies might market the availability of human advisors for complex needs, thereby personalizing in a high-touch way for premium customers. So the dominance of AI is balanced by an emphasis on human customer service where it counts, and by compliance with regulations that protect consumers. This scenario sees AI as an augmenting tool – crunching data and suggesting personalized tactics – but humans still set broad strategy and creative direction (possibly because of an understanding that pure AI optimization can sometimes conflict with brand values or can lead to unintended consequences if not checked).
Scenario 3: Backlash and “Tech-Lash” Significantly Limits AI Personalization – In a more pessimistic (for AI) scenario, over the next two decades consumers and regulators react strongly against over-personalization and data misuse. Perhaps there are high-profile scandals of AI microtargeting causing harm (e.g., manipulating vulnerable populations or big privacy breaches). The result could be a major pullback: strict regulations that severely limit personal data collection and targeting. For example, browsers might phase out all tracking cookies (a process already underway) and new laws might ban using sensitive personal data for marketing. If AI cannot get rich data, its ability to personalize diminishes. Marketing strategies then might revert to more context-based or cohort-based targeting (targeting groups with similar traits without identifying individuals, as with Google’s proposed Topics API). In this world, personalization is more anonymized and less granular. We might also see consumer resistance – tools like AI-driven ad blockers, or subscription models where people pay to not be targeted. If consumers en masse choose privacy over personalization, companies will adjust strategies to focus on broad appeals, brand building, and contextual ads rather than hyper-targeted ones. AI might still dominate internally (marketers use AI for analysis, trend spotting, content optimization) but the external manifestation is not ultra-personalized ads for each person. Instead, AI could be used to create highly engaging content or to simulate market scenarios, but marketing messages themselves might return to being more uniform (akin to how TV ads work). Also, heavy regulation might mandate AI transparency – e.g., if content is AI-generated or an AI bot is interacting, it must be disclosed. This could make some consumers wary and prefer human-created content, influencing strategies (for instance, some brands may flaunt “human-made” as a selling point, much like “handmade” or “organic” labels, as a reaction to AI ubiquity).
Hybrid scenario: A likely reality is a mix – AI personalization will certainly increase and become a major component of strategy, but it will coexist with concerns that need addressing. We’ll probably see marketers find creative solutions to balance personalization with privacy. For example, the use of federated learning (where AI models personalize on-device without raw data leaving the user’s device) could enable one-to-one marketing without compromising privacy as much. Or industry standards for ethical AI in marketing might emerge, possibly guided by NGOs or consortiums, to avoid the worst manipulations. We will also see new platforms: AI could give rise to marketing via immersive experiences (AR/VR) which themselves will be personalized. Imagine walking in a virtual mall where each storefront AI-changes based on your preferences. Or voice AIs like Alexa recommending products conversationally based on your habits. These could dominate how marketing messages reach us, effectively replacing some traditional channels. At the same time, the human craving for authenticity might ensure that not everything is algorithmic – maybe experiential marketing (real-world events) or word-of-mouth/community marketing regains importance as an antidote to AI saturation.
In any case, companies in the next two decades will likely have to incorporate AI personalization to stay competitive, but will also need to manage ethical and trust issues. The Pew Research Center’s canvass of experts on AI in 2040 found a split – many foresee AI beneficially automating and customizing things, while others worry about the negative outcomes (loss of privacy, autonomy, etc.). We can expect marketing strategies to reflect that duality: those who master AI for good (enhancing customer value in a trusted way) will dominate, whereas those who misuse it may face consumer and legal backlash.
In conclusion, AI-augmented personalization is poised to be a dominant force in marketing strategies due to its promise of efficiency and relevance. The most likely scenario is not unchecked dominance, but rather pervasive use with oversight. By 2045, perhaps virtually every large company’s marketing will be heavily AI-driven behind the scenes, and customers will be accustomed to a highly personalized flow of offerings – yet there will be guardrails (some industry-imposed, some government-imposed) to prevent the most egregious manipulations and to protect privacy. Marketers will also still inject creativity and brand storytelling (often with AI help) to ensure they forge genuine connections, not just algorithmic transactions. Those plausible futures outline both excitement – hyper-personalization could mean marketing truly feels like a service, not an intrusion – and caution, as society grapples with what level of personalization is beneficial versus creepy.
Limitations of Current Marketing Strategy Practices and Their Externalities
Despite advances in marketing, several limitations or pitfalls plague current marketing strategy practices. These not only hinder business performance but also create externalities – side effects on consumers, society, or the environment. Here are three major limitations and the externalities they engender:
1. Short-Termism and Overemphasis on Quick Wins: Many companies are fixated on immediate results – quarterly sales targets, instant ROI on campaigns – at the expense of long-term strategy. This leads to marketing practices like constant price promotions, spammy high-frequency communications, and gimmicky campaigns to spike short-term metrics. The limitation here is a neglect of long-term brand building and customer relationship nurturing. Externalities: One negative externality is the training of consumer behavior in undesirable ways. For instance, excessive promotions can **“train consumers to buy earlier or more at a lower price”*, essentially conditioning them to wait for sales and eroding their brand loyalty. This not only hurts the company’s long-term profitability (as Nielsen noted, promotions deliver only about half the long-term returns of brand advertising), but also leaves consumers in a cycle of constant bargain-hunting and potential dissatisfaction (if they buy only on promo, they may undervalue products or over-consume due to perceived deals). Another externality of short-termism is consumer fatigue and mistrust. When customers are bombarded with sales emails every day or see flash sales every week, they grow numb and cynical about marketing messages. This can contribute to an overall climate of consumer distrust, where marketing is seen as manipulative noise rather than useful information. Additionally, short-term focus can drive overconsumption. For example, pushing too many limited-time offers can lead people to buy more than they need, contributing to waste. In the food sector, constant “buy one get one” promotions on perishable goods, designed to hit volume targets, often result in food waste at the consumer end – a social/environmental externality. In summary, the short-term tactical mindset yields immediate sales blips but undermines brand equity and consumer trust, imposing on society a landscape of shallow, noisy marketing and habituated discount-chasing behavior.
2. Excessive Personalization and Data Exploitation (Privacy Erosion): Modern marketing’s hunger for data and targeting has led to practices that many view as intrusive. Companies track detailed user behavior, sometimes without clear consent, and deploy algorithms to micro-target ads. The limitation is that this can cross into manipulation rather than serving customer interests – using data to exploit psychological biases or momentary weaknesses (e.g., targeting gambling ads to known addicts). Externalities: The foremost externality is a loss of consumer privacy. People’s online (and offline) activities are constantly monitored for marketing purposes, which has societal implications for privacy rights and personal autonomy. Consumers often are not fully aware of how their data is used, and when they do realize the extent (say, they mention something aloud and then see an ad for it, or ads “follow” them around the web), it creates discomfort and anxiety. This contributes to a climate of digital mistrust and stress. Another externality is the potential for social fragmentation and discrimination. Micro-targeted marketing – especially in areas like political advertising or “personalized” news content – can create filter bubbles, amplifying polarization. Even in commerce, if algorithms decide certain high-value customers get better deals or service, other groups might be excluded or pay more (a form of price discrimination that could be seen as unfair, potentially even along sensitive lines like geography or income). We also see ethical concerns: advanced AI-driven marketing can manipulate choices in ways consumers aren’t aware of, raising questions of agency. Recognizing these issues, regulators are starting to crack down on manipulative design or “dark patterns” (the EU’s Digital Services Act bans interfaces that deceive or coerce users). The existence of these laws underscores that current practices have produced negative externalities requiring intervention. Lastly, heavy data-driven personalization, combined with opaque algorithms, can spread misinformation or biased content as part of content marketing (if sensationalism drives clicks, algorithms may “personalize” feeds to show extreme content, with broader social fallout).
3. Promotion of Overconsumption and Environmental Harm: Traditional marketing often operates on the principle of selling more and more – which can conflict with sustainability. Many marketing strategies don’t account for environmental costs of encouraging consumption. Fast-fashion marketing is a prime example, where rapid cycles of promotion lead to overconsumption of clothing and massive waste. The limitation is a lack of incorporating sustainability into strategy – marketing still largely measures success in volume and growth without regard to planetary limits. Externalities: The negative externalities here are significant: environmental damage and resource depletion. Advertising has been called a driver of a “consumer society” where wants are turned into perceived needs. The relentless push to buy new products (the latest phone, bigger vehicles, etc.) contributes to higher carbon emissions, more landfill waste, and unsustainable resource extraction. For instance, the advertising industry itself has a carbon footprint – a study found online advertising contributes an estimated 10–20% of the internet’s energy consumption (serving data-heavy ads, running programmatic auction servers, etc.). That’s a direct environmental externality of current digital marketing infrastructure. Moreover, campaigns seldom highlight product longevity or repair – instead many implicitly promote a throwaway culture (“new model out – upgrade now!”). Another externality tied to overconsumption is public health and social costs. Think of aggressive marketing of unhealthy foods or sugary drinks – it boosts sales but contributes to obesity and related health burdens on society. Or marketing of tobacco and alcohol in regions with less regulation – again, the social cost (medical care, etc.) far exceeds the benefits to the marketer. On the flip side, this limitation has also blocked positive externalities: Marketing could be a powerful lever for good (e.g., promoting sustainable lifestyles, normalizing reuse), but when strategy is narrowly focused on short-term sales, those opportunities for positive externalities are missed. For example, an automaker’s marketing strategy might fight tooth and nail to sell gas-guzzling SUVs because they’re profitable, while the externality is more CO2 emissions; a more enlightened strategy could market EVs and alternatives, benefiting society – but many firms stick to what’s easy and immediately profitable, leaving the external benefits unrealized.
In summary, the current practice of marketing strategy has these and other limitations: a short-term orientation that creates a culture of consumer mistrust and potential waste; a data-driven overreach that undermines privacy and can manipulate or exclude consumers; and a growth-at-any-cost mindset that externalizes environmental and health costs onto society. Addressing these issues is part of the next question – but it’s clear that as marketing stands, these side effects need mitigation. There are also positive externalities of marketing done right (e.g., educational campaigns, supporting content creators via advertising funding), but the negative ones outlined have become increasingly pressing in discussions among policymakers and ethical business leaders.
Improving Marketing Strategies to Curb Consumer Manipulation and Environmental Harm
Given the issues above, there are several actionable steps that companies, regulators, and NGOs can take to guide marketing onto a more ethical and sustainable path. Here are four key measures:
1. Enforce Transparency and Ethics in Data Use (Regulator Action): Regulators should continue to strengthen and enforce laws that prevent manipulative, non-consensual marketing tactics. This includes banning “dark patterns” and deceptive design in digital marketing interfaces. For example, the EU’s recently adopted Digital Services Act explicitly prohibits designing online interfaces in ways that deceive or manipulate users into choices they wouldn’t freely make. Implementing such regulations globally (and extending them to areas like subscription traps, sneaky auto-renewal practices, etc.) will reduce consumer manipulation. Additionally, data privacy laws (like GDPR and California’s CPRA) need to be rigorously enforced and updated to cover new technologies. Companies should be required to be transparent about what data they collect and how it’s used for marketing, giving consumers clear opt-in/out rights. Regulators could mandate simple “why am I seeing this ad?” disclosures on personalized ads, which many platforms now provide, to demystify targeting. Beyond compliance, industry bodies can create ethical codes of conduct for marketers on data usage – for instance, pledging not to target vulnerable populations in exploitative ways (similar to how pharma companies avoid marketing certain products to vulnerable groups). The net effect is that marketing remains persuasive but within boundaries of fairness and respect for autonomy.
2. Elevate Consumer Education and Choice (NGO/Industry Action): NGOs and consumer advocacy groups can play a role by educating the public on how marketing works and how to resist manipulation. Increased digital literacy helps consumers recognize and shrug off tactics aimed to impulsively hook them. For example, organizations can run awareness campaigns about common marketing tricks (like scarcity countdowns – “Only 2 left!” – which are often false urgency). On the industry side, companies that want to differentiate on trust can provide consumers with more control. This could mean more granular ad preference settings, or an easy way to opt out of behavioral tracking (as some browsers are now offering). One innovative idea is a “Do Not Track” or ad registry where consumers can see all segments and interests advertisers have assigned to them and edit them – giving power back to the user. While this is partly regulator-driven, companies could voluntarily participate to build trust. Another angle: third-party certifications for ethical marketing (akin to fair trade labels). For instance, an independent body could certify that a company does not use deceptive advertising and meets certain sustainability criteria in marketing (printing on recycled paper, carbon-neutral ad serves, etc.). This positive labeling could encourage companies to improve practices to earn the certification, and NGOs could promote it to consumers to favor certified brands.
3. Embed Sustainability into Marketing Strategy (Company and Regulatory Action): To tackle environmental harm, companies need to adopt sustainable marketing principles. This means marketing not just the product benefits to the consumer, but aligning campaigns with environmental values and encouraging responsible consumption. Concretely, companies can set guidelines that their marketing will not encourage overconsumption or wasteful behavior. For example, a clothing retailer might shift from “buy more!” messages to “buy better, use longer” messages, perhaps promoting their durable quality or take-back programs. Regulators can assist by implementing policies like France’s pioneering move: France now requires car ads to include messages encouraging alternative transport like walking or cycling for short trips. This kind of mandate internalizes some social responsibility into marketing communications. Similarly, regulations could limit advertising of the most environmentally harmful products (there’s active discussion in the EU about banning fossil fuel advertising, similar to tobacco). Companies, anticipating such shifts, could voluntarily cease advertising products or packaging that are unsustainable, and reallocate budget to promote greener offerings. Another actionable step is greening the advertising supply chain – for instance, brands and agencies can commit to carbon-neutral advertising by using renewable energy for digital advertising infrastructure and optimizing ad tech to reduce those staggering energy wastes (like cutting down those trillions of programmatic auctions that serve no ad). Industry coalitions like Ad Net Zero (in UK) are already working on reducing advertising’s carbon footprint. Companies can join these initiatives and make them part of their marketing KPIs.
4. Align Marketing with Purpose and Authenticity (Company and NGO Action): Companies should re-orient marketing strategies to authentic purpose-driven narratives, which by nature are less manipulative and more value-driven. This involves training marketing teams to avoid hyperbolic or misleading claims and instead communicate transparently. For instance, rather than greenwashing (making vague eco-friendly claims), a company should market specific, substantiated sustainability achievements. If a firm is purpose-led (say a food company aiming to improve community health), its marketing can incorporate educational content (like healthy recipes, community fitness events) – contributing positively to society while marketing its brand in a non-manipulative way. NGOs can aid by acting as watchdogs and partners: calling out misleading campaigns, but also collaborating with brands on cause marketing that truly advances a cause. A good model is the “Clean Creatives” pledge, where over 1,000 agencies and creatives have pledged not to work with fossil fuel clients. This is an NGO-driven initiative that improves marketing strategies by steering them away from promoting harmful industries. More such pledges or collective commitments can reshape the landscape: imagine a pledge to not use children’s data for targeting, or a pledge to allocate a percentage of ad budget to campaigns that promote public good (like anti-littering, etc.). Each company can also institute an internal ethical review board for marketing – to evaluate campaigns for any potential harmful externalities (are we stereotyping? Are we encouraging unsustainable behavior? Could this deceive people?). Having that checkpoint can prevent negative externalities before they happen.
In addition to these, we should mention increasing consumer voice in strategy design. Companies can involve consumer advocacy representatives when planning major marketing initiatives – almost like an ethics committee. This way, potential manipulation or harm might be flagged early from a consumer perspective. For environmental aspects, companies could team up with environmental NGOs to craft marketing that truly helps (some brands have done campaigns where for each ad view or click, they donate to a cause – leveraging marketing spend for good).
Collectively, these actions push towards a marketing ecosystem that is more transparent, fair, and aligned with societal well-being. Some benefits will accrue to the companies too: by reducing manipulative tactics, they may rebuild trust and brand loyalty; by embracing sustainability, they appeal to the growing segment of eco-conscious consumers and pre-empt regulatory pressures. It’s essentially bringing long-term thinking and responsibility into marketing strategy. The result, ideally, will be that marketing once again is seen as a valuable service – providing people with honest information about products that improve their lives – rather than a source of annoyance or harm. Each stakeholder has a role: regulators set the rules of the game, companies play ethically within (and beyond) those rules, and NGOs/consumer groups keep everyone honest and informed.
In conclusion, improving marketing strategies to curb consumer manipulation and environmental harm is not only possible but already in motion through various initiatives. The four ways outlined – from legal bans on deceptive practices, to required pro-health/pro-environment messaging in ads, to industry pledges for ethical clients and purpose – all converge on a more sustainable and principled marketing practice. Over time, as these measures take hold, we can hope to see a marketing landscape where integrity and sustainability are competitive advantages, and where trust between consumers and marketers is restored.
Sources:
2. Marketing mix, Notebook LM
The marketing mix is formally defined as a "mixer of ingredients" that a marketer creatively fashions to produce a profitable enterprise. More broadly, marketing itself is described as the process of planning and executing the conception, pricing, promotion, and distribution of ideas, goods, and services to create and exchange value, satisfying individual and organisational objectives. This implies that the marketing mix comprises the tools available to a marketer to achieve these objectives
.
What exactly is included in a ‘4 Ps’ versus an ‘8 Ps’ marketing mix?
The traditional marketing mix is commonly known as the "4 Ps", which include
:
• Product: This encompasses the core benefit being marketed, its translation into a tangible product with features, quality, options, design, and packaging. It also includes an "augmented product," which is a "service layer" like prompt delivery, installation, and after-sales service
. Communication helps align the product with customer expectations and evaluates its suitability and demand
.
• Price: This refers to the list price, discounts, incentives, payment periods, and interest rates. It's unique as the only marketing instrument that generates resources rather than costing them. However, frequent price cuts can erode profit margins and brand loyalty
.
• Place (Distribution): This involves finding the most appropriate locations and choosing the right distribution channels to sell products, impacting accessibility and visibility. It extends beyond physical stores to include websites, catalogues, social media, and trade shows
.
• Promotion (Marketing Communications): This includes all instruments a company uses to communicate with its target groups and stakeholders to promote products or the company as a whole
. Promotion aims to tell a compelling brand story that resonates with consumers and guides them to consider offerings, aligning with target audience preferences
.
While the sources extensively discuss the 4 Ps, they also introduce "the extra 3", expanding the mix to 7 Ps
:
• People: This refers to customers, clients, and employees – anyone directly or indirectly involved in the business, including those selling, designing, or marketing products or services
.
• Physical Evidence: This relates to the tangible environment where a product or service is delivered, such as the appearance of a company or its physical setting
.
• Process: This refers to the delivery of the product or service itself
.
The provided sources do not explicitly outline an "8 Ps" marketing mix.
This element focuses on crafting offerings that meet the needs, desires, and aspirations of the target audience. It involves aligning the product with customer expectations and evaluating its suitability, usefulness, and demand. The product tool consists of three layers: the core product (unique benefit), the tangible product (features, quality, design, packaging), and the augmented product (service layer like delivery, installation, after-sales service)
The information you provided regarding the three layers of the product tool – the core product (unique benefit), the tangible product (features, quality, design, packaging), and the augmented product (service layer like delivery, installation, after-sales service) – is from "epdf.pub_marketing-communications-a-european-perspective.pdf".
Specifically, this description can be found in a section discussing the Marketing Mix and its instruments. The source explains that:
This framework is part of how marketing communication integrates the instruments of the marketing mix to effectively convey product value, build brand awareness and loyalty, and influence consumer purchasing decisions.The information you provided regarding the three layers of the product tool – the core product (unique benefit), the tangible product (features, quality, design, packaging), and the augmented product (service layer like delivery, installation, after-sales service) – is from "epdf.pub_marketing-communications-a-european-perspective.pdf".
Specifically, this description can be found in a section discussing the Marketing Mix and its instruments. The source explains that:
This layered understanding of a product is fundamental to strategic marketing and plays a vital role in integrated marketing communications, where all marketing instruments are designed to work synergistically to present a consistent message to target audiences.
This is the only marketing instrument that generates revenue. The right pricing strategy is critical for a product's success and can communicate quality or exclusivity. Strategies include Price Skimming (high initial price, then lowered), Competition-Based Pricing, Premium Pricing (emphasising quality with a high price), Value-Based Pricing (based on perceived customer value), and Cost-Plus Pricing (production cost plus markup)
A social business must hit two (or three) bottom lines at once: cover its full economic cost and unlock the social / environmental outcomes it promises (
).
That tension shows up in four permanent questions:
Six field-tested pricing architectures for social enterprises
View of Table 82
Architecture
When to use it
Mechanics
Real-world signals
Architecture
When to use it
Mechanics
Real-world signals
Cost-plus with “mission margin”
Early-stage ventures that must become cash-positive fast
Add a transparent % on top of true unit cost; ring-fence part of that margin for impact spend
Craft breweries that post open-book costing; repair cafés that add a €2 “community dividend” line
Cross-subsidy (“Robin-Hood”)
Segments have very different ability-to-pay
Premium or B2B line funds a low-cost or free tier for priority users
Aravind Eye Hospital charges market rates to wealthier patients so 50–60 % of poor patients pay nothing ()
Buy-One-Give-One / %-of-sales
Marketing benefit of a simple promise, tangible product
Bake the donation cost into the unit price (or accept slimmer margin)
Sliding-scale / Pay-what-you-can
Community services with wide income spread, low marginal cost
Publish a price band and let customers self-select
Yoga or therapy collectives that frame pay-what-you-can as economic-justice practice (, )
Outcome-based (impact contracts, subscriptions)
Funders/governments care more about results than units sold
Price tied to verified outcomes (e.g., jobs kept, CO₂ avoided); often paid in arrears
Social Impact Bonds in workforce training; waste-reduction apps that bill municipalities per tonne saved
Membership / Community Patronage
Mission involves ongoing relationship & advocacy
Tiered dues or “impact subscriptions” unlock content, events, voting rights
Museums’ “pay it forward” memberships; community-owned energy co-ops charging €5/mo to non-local supporters
There are no rows in this table
A step-by-step framework to choose (or mix) models
View of Table 83
Step
Key actions
Tips & pitfalls
Step
Key actions
Tips & pitfalls
1 — Define double bottom line
Articulate precise financial and impact KPIs (e.g., gross margin ≥ 25 %; 10 000 low-income users served/yr).
Keep no more than 3–4 KPIs or the price logic becomes fuzzy.
2 — Map willingness & ability to pay
Segment by income, urgency, mission-alignment. Use surveys, focus groups, participatory workshops.
Let beneficiary voices co-design tiers to avoid top-down bias.
3 — Calculate true unit cost
Include hidden items: volunteer coordination, certification, impact measurement, depreciation.
Social ventures regularly under-price by ignoring “impact overhead”.
4 — Pick a primary architecture + safety valves
Choose the column above that best matches segments; add a safeguard (e.g., hardship fund, donor pool).
You can run both cross-subsidy and sliding-scale—just keep the narrative simple.
5 — Prototype & learn
Pilot for 4–12 weeks; track uptake, cost recovery and mission KPIs.
Publish data openly; transparency strengthens trust even when you miss early targets.
6 — Iterate pricing story
Fold lessons into a clear narrative: “€1 of every €5 funds free repairs” or “Your premium tier subsidises two low-income members.”
Story has to be the same on shelf, web, investor deck and press release.
There are no rows in this table
Quick reference: matching models to common missions
View of Table 84
Mission focus
Often-effective model
Mission focus
Often-effective model
Health & education access
Cross-subsidy + outcome contracts
Circular / zero-waste retail
Cost-plus with mission margin + buy-one-give-one for awareness
Community arts & wellbeing
Sliding-scale / membership patronage
Digital public goods
Freemium → subscription for power users; pay-what-you-can donations
There are no rows in this table
Checklist before you launch a new price
Price is never “set & forget” in a social enterprise: it’s a loud lever you’ll pull again and again as markets, costs and impact goals evolve. Treat the process itself as part of the social innovation.
. It aims to tell a compelling brand story that resonates with consumers. Communication is crucial for conveying a product's value, creating brand awareness and loyalty, and influencing purchasing decisions. Promotion can communicate trendiness
Some sources also expand the marketing mix to include additional Ps:
The marketing mix and an Integrated Marketing Communications (IMC) plan are distinct but highly interconnected.
• Marketing Mix: This is a broader strategic framework comprising the fundamental tools (Product, Price, Place, Promotion, People, Physical Evidence, Process) a company uses to achieve its overall marketing objectives
. It's about how a company crafts its offering and brings it to market
.
• Integrated Marketing Communications (IMC) Plan: This is a specific component within the broader marketing mix (specifically, the "Promotion" P), focused on coordinating and integrating all communication channels and messages to deliver a clear, consistent, and compelling message about the company and its brands
.
Key differences highlighted in the sources include:
• Scope: The marketing mix is a set of "ingredients" for an overall marketing strategy
. IMC is about how all those ingredients communicate with the target audience
.
• Perspective: IMC is fundamentally defined from the consumer's point of view, aiming to create an "added value" in terms of faster or better comprehension by presenting messages in an integrated way
. The consumer doesn't distinguish between advertising, sponsorship, or direct mail; they perceive them as indistinguishable sources of information
.
• Objectives: While the marketing mix sets overall goals like sales and profit
, IMC's primary objective is to ensure consistency and synergy across messages to influence consumer perception and purchasing decisions. It aims to overcome language barriers, cultural differences, and customer preferences by creating clear and visually appealing content
.
• Implementation: IMC requires careful planning and strategic integration of various departments responsible for communication functions, which traditionally operate separately
. It shifts from mass media and generalized messages to more personalized, customer-oriented, and interactive communication
.
In essence, while the marketing mix determines what a company offers and how it offers it, IMC ensures that all communications about that offering are harmonious and effective from the consumer's perspective, maximizing the potential of the "Promotion" element
.
Digital-first firms exhibit significant divergences in their marketing mix compared to traditional retailers, primarily due to their inherent technological foundation and online focus:
• Place (Distribution Channels): Digital-first firms' "place" extends beyond physical locations to primarily include websites, online catalogues, social media platforms, and online trade shows
. In contrast, traditional retailers heavily rely on brick-and-mortar stores
.
• Promotion (Marketing Communications): Digital-first firms heavily leverage e-communication tools such as e-marketing, mobile marketing, interactive television, and relationship marketing via digital channels
. They use sophisticated "behavioural advertising" techniques to learn about viewer interests and provide tailored messaging. Their communication is characterized by interactivity, allowing two-way communication and immediate response, unlike the one-way nature of traditional mass media. Email marketing, for instance, offers a direct communication line at lower costs than traditional direct mail
.
• Relationship Building and Data Utilisation: Digital-first firms excel in one-to-one marketing and relationship marketing by collecting detailed customer data. This allows them to create individualized, tailored value propositions, customize products/services, and engage in ongoing online communication, shifting focus from customer acquisition to customer retention
. Databases are crucial for direct marketing activities and can be used to track customer needs and behaviour, allowing for event-driven database marketing where offers are timed to customers' specific life events or interactions
.
• Cost-Effectiveness and Flexibility: E-communication tools are often cheaper, more flexible, and highly selective for targeting, which is a significant advantage over traditional mass media
.
In essence, digital-first firms capitalize on technology to create more personalised, interactive, and data-driven marketing mixes, especially in their promotional and distribution strategies, allowing for more precise targeting and relationship building than traditional retailers
The sources suggest that systematically optimising elements of the marketing mix is designed to increase customer lifetime value (CLV), implying a causal link rather than merely a correlational one, especially through strategies focused on building loyalty and relationships.
• Relationship Marketing and Loyalty: The concept of customer lifetime value is "an important concept for the direct marketer involved with relationship or retention marketing," as it helps determine "how much it can invest in attracting and making loyal potential new customers"
. This approach is based on the principle that "customer satisfaction, loyalty and profitability are correlated"
.
• Brand Building: Strong brands are underpinned by "a group of loyal consumers," and "the real company asset is brand loyalty, not the brand itself"
. Marketing communications are considered "crucial contributors to brand equity" which translates into this loyalty. Building loyalty is explicitly stated as a "cost-saving strategy," as attracting new customers is significantly more expensive than retaining existing ones
.
• Integrated Communications: Effective communication in the marketing mix is presented as vital for "maximising its potential" and for "establishing strong connections with the target audience, leading to successful marketing campaigns and increased business growth"
. Integrated marketing communications (IMC) focuses on "building a long-term relationship with target groups by means of consistent interactive communications"
.
While perfect isolation of causal effects is acknowledged as challenging due to the interplay of various factors and competitive actions
, the strategic intent and described outcomes strongly point to a causal pursuit of increased CLV through marketing mix optimisation, particularly via communication and relationship-building efforts.
The sources offer indirect insights into how product breadth (e.g., through line extensions) might influence price elasticity, mainly by affecting consumer choice and competitive dynamics:
• Increased Variety and Competitive Position: Line extension strategies involve using the same brand name for new products within existing categories, expanding the variety of offerings to accommodate new consumer segments
. This "improves the competitive position of the brand by offering consumers more variety, as a result of which they are not inclined to look to competitive brands to satisfy their needs"
. When consumers have more choices within a trusted brand, they might be less sensitive to price changes of that brand's individual products, thus potentially lowering the overall price elasticity for the brand.
• Brand Image and Quality Perception: Price itself can communicate quality and exclusivity
. While not directly tied to breadth, if a broad product line reinforces a premium brand image, it could allow for premium pricing
. Conversely, if product breadth is used to offer many similar products at different price points, it might make consumers more sensitive to price differences (higher elasticity), especially if some offerings are perceived as "value" options.
• Cannibalization: A potential downside of product breadth, such as through line extension, is that "the original brand loses its meaning and clear positioning"
. While cannibalization is seen as inevitable and preferable to losing market share to competitors, it suggests that new products might compete on price with existing ones within the same portfolio, potentially increasing internal price elasticity
.
The explicit relationship between product breadth and price elasticity is not fully detailed in the provided texts, but the mechanisms relate to how product variety affects consumer perception of value and the competitive landscape.
The marketing mix concept has evolved from an early conceptualisation to a more structured and expanded framework:
• Borden's "Mixer of Ingredients": The origin of the concept is attributed to Borden, who conceptualised marketing as "a mixer of ingredients"
. This view highlights the creative process involved in combining various marketing elements.
• McCarthy's "4 Ps" (1960): McCarthy formalized Borden's idea by categorizing these ingredients into the widely recognized "4 Ps": Product, Price, Place, and Promotion
. This framework provided a structured way to think about and manage marketing activities.
• Later Extensions ("The Extra 3"): Over time, additional elements were added to the marketing mix, particularly in the context of services, leading to what the sources refer to as "the extra 3": People, Physical Evidence, and Process
. This expands the framework to a 7 Ps model, acknowledging the crucial role of human interaction, tangible cues, and service delivery mechanisms, especially in service-oriented businesses.
This evolution reflects a deepening understanding of the complex factors influencing market success beyond just the core product, price, distribution, and promotion.
Which socio-economic shifts most reshaped the relative weight of each P over the last 50 years?
Several socio-economic shifts have significantly reshaped the relative weight of each "P" in the marketing mix, leading to a greater emphasis on certain aspects:
• Information Overload and Communication Clutter: Consumers are "inundated with choices and information," leading to confusion and making it difficult for ads to attract attention
. This has led to a "loss of faith in mass media advertising" and an increase in advertising avoidance behaviour due to irritation. This shift has increased the need for more targeted and personalized "Promotion" efforts
.
• Technological Evolutions (Digitalisation): The "fast-growing internet penetration," rise of mobile phones, and interactive digital television have fundamentally changed marketing communications
. This has shifted power towards the consumer, who now "decides what he or she will be exposed to and how he or she will react to it". This has dramatically increased the weight of digital "Promotion" and transformed "Place" to include online channels, demanding interactive and personalized approaches
.
• Market Maturity and Low Brand Differentiation: Many markets in well-developed countries are mature, with products and brands of similar quality
. This makes it "increasingly difficult for consumers to distinguish brands on the basis of their intrinsic qualities". Consequently, there's an increased need to differentiate by means of "Communication" (Promotion), making it a "sustainable competitive advantage"
.
• Short-Term Orientation and Accountability: There is a "growing need for increased levels of accountability" and a demand for "directly effective marketing strategies" whose effectiveness can be assessed instantaneously
. This drives marketers towards promotional tools with immediate, measurable behavioural responses, increasing the weight of "Sales Promotions" (part of Promotion) over long-term image-building advertising
.
• Shift to Relationship Marketing and Customer Loyalty: There's an "increasing importance of building customer loyalty instead of attracting and seducing new customers"
. This has led to a move towards "relationship marketing", which implies a "soft sell" approach and consistent interactive communications. This emphasizes the "Process" and "People" elements (especially in services) and highlights the role of "Promotion" in building long-term customer bonds rather than just transactions
.
• Globalisation: Increased exposure of consumers to international communication stimuli necessitates consistency in communication across all countries, reinforcing the need for integrated "Promotion" strategies
.
These shifts collectively emphasize a more strategic, targeted, and relationship-driven "Promotion" and a broader definition of "Place" beyond physical locations, while also underscoring the importance of "People" and "Process" for customer experience and loyalty.
The sources indicate that the marketing mix framework can accommodate sustainability-oriented marketing goals, although its suitability largely depends on how the elements are interpreted and implemented.
• Ethical Considerations: The textbook explicitly includes a chapter on "Ethical issues in marketing communications"
. It discusses how marketing communications have been accused of creating materialistic cultures but also notes that "emerging social consciousness about the environment has led marketing communications to integrate this issue and argument into its campaigns"
. This implies that ethical and environmental concerns can be woven into promotional messages.
• Corporate Social Responsibility (CSR): Companies can engage in Corporate Social Responsibility programmes to position themselves as ethical and "good citizens"
. This involves considering "public values" in marketing communications, going beyond merely legal compliance. High advertising spending and investing in corporate social responsibility initiatives are identified as "brand-building activities"
.
• Information Policy: Information policy includes ethical considerations, such as protecting vulnerable populations and preventing manipulation through advertising
. This suggests that "Product" (e.g., through health information on food labels) and "Promotion" must align with ethical guidelines.
While the "4 Ps" framework itself is a structural model, the content within each "P" can be adapted to sustainability. For instance, "Product" can incorporate eco-design, "Price" can reflect fair trade costs, "Place" can involve sustainable supply chains, and "Promotion" can communicate environmental or social benefits. The sources show an awareness of integrating ethical and social concerns into marketing practices, suggesting the framework is adaptable.
The provided sources do not contain information that directly discusses "inclusive-design objectives" or how reliance on the "4 Ps" might impede them. The focus is primarily on market segmentation, target groups, and effective communication strategies rather than product design for broad accessibility or inclusivity in a design context
The dominance of "Promotion" in the marketing mix, particularly in its varied forms, can be justified by several marketing and behavioural economics theories mentioned in the sources:
• Hierarchy-of-Effects Models: These models assume consumers go through cognitive (awareness, knowledge), affective (feelings, attitudes), and conative (actions, buying) stages in response to communication stimuli
. Promotion (especially advertising) is crucial for guiding consumers through these stages, from creating attention to evoking acceptance and purchase intention. The long-term objective of most campaigns is sales and market share growth, for which communication is a key driver
.
• Weak Theory of Marketing Communications (ATR Model): This theory (Awareness → Trial → Reinforcement) suggests that marketing communications primarily aims to arouse awareness, induce a first trial purchase, and then reassure and reinforce users after their first purchase
. This directly supports promotional efforts focused on driving initial behaviour and fostering repeat buying and loyalty.
• Behavioral Economics (Cognitive Biases & Nudges): Behavioural economics studies dissonances in consumer behaviour, cognitive biases, and the use of "nudges"
. It highlights the importance of how information is presented and framed. Promotions, particularly sales promotions, act as "nudges" by offering immediate incentives and influencing behaviour directly in the short term, which is highly desired by marketers seeking immediate results. The effectiveness of "nudges" is discussed in terms of altering consumer behaviour through a "stimulus-response" mechanism
.
• Saturated Markets and Brand Differentiation: In saturated markets where products are very similar and functional differences are less important, it's difficult to differentiate brands based solely on intrinsic qualities
. Promotion becomes vital to "make the difference" by influencing perception and creating emotional product characteristics. This increases the weight of promotional activities to establish unique positioning
.
• Communications Clutter and Avoidance: The "increasing advertising pressure" and "communications clutter" lead to "increased irritation and advertising avoidance behaviour"
. This forces marketers to use diverse promotional tools to "break through the clutter" and attract consumer attention, hence the increasing importance of sales promotions and highly targeted methods
.
In summary, the dominance of "Promotion" is justified by its direct impact on consumer awareness, attitudes, and behaviour, its ability to differentiate brands in crowded markets, and its adaptability to counter consumer avoidance in an information-rich environment, often leveraging insights from how consumers process information and react to stimuli.
The provided sources do not directly refer to "service-dominant logic" or its specific criticisms of the traditional marketing mix.
However, the sources do discuss shifts in marketing thought that align with some general critiques of a purely product-centric view:
• Shift from Transactional to Relational Focus: There's a movement from "aggressive selling orientation" to a "customer orientation with a focus on building long-term relationships"
. In personal selling, "Selling is no longer the central issue; customer satisfaction is"
. This contrasts with a traditional "4 Ps" view that might be perceived as more transactional, focusing on discrete sales rather than ongoing relationships.
• Consumer Empowerment: The sources highlight that the "market situation has gradually shifted from a situation in which all the power of knowledge and control was in the hands of the manufacturer to a market in which the retailers are the strongest party. Today the balance is shifting towards a market in which the consumer is the most powerful agent"
. This emphasizes that consumers are active participants who "decide what they want to receive, how often they want to receive it and through what channels"
. A service-dominant logic would argue that value is co-created with the customer, a concept not explicitly articulated as a critique of the 4Ps but implied by the shift in power.
While the term "service-dominant-logic" is not used, the texts acknowledge a significant evolution in marketing thought towards customer-centricity and relationship building, which underpins the need for approaches beyond a narrow interpretation of the traditional marketing mix.
Rigorously measuring the effectiveness of each P in a multi-channel campaign is a complex task due to the interplay of various marketing elements and environmental factors
. The sources provide several approaches:
• Overall Campaign Evaluation: Campaign evaluation research focuses on the effectiveness of the whole advertising campaign rather than single ads or media, acknowledging the integrated nature of marketing communications
. It uses brand-related effectiveness measures such as awareness, knowledge, attitude, and intention to buy
.
• Strategic Advertising Research: This involves studying the product (strengths, weaknesses, unique selling proposition), the market (size, shares, competitors' strategies, consumer behaviour), and the environment (legal, cultural, economic) to build a solid communication strategy
.
• Measuring "Promotion" Effectiveness:
◦ Advertising: Measures include top-of-mind awareness (TOMA) (unaided recall), aided awareness, and brand preference evolution
. Attitude change and changes in brand image are also measured using scale techniques. Purchase intention is assessed by asking about the likelihood of future purchase. Tracking studies collect data at regular intervals to monitor brand position and campaign effects over time. Advertising efficiency can be estimated by comparing advertising budgets to sales over time, though isolating the effect is difficult
.
◦ Sales Promotions: Effectiveness is assessed by studying sales evolution during and after the promotion period to calculate extra sales volume and identify "post-promotion dips"
. Consumer panel data can be used for "launch analysis" of new brands, decomposing market share into attraction, conviction, domination, intensity, and shock absorption
.
◦ Direct Marketing: This tool allows for immediate measurement of effects
. Key metrics include response rates and the calculation of customer lifetime value. The success is often measured by "customer share" (quantity and frequency of individual purchases) rather than just market share. Database marketing stages (e.g., product-driven, multi-channel, event-driven) offer insights into customer behaviour
.
◦ E-communications: Effectiveness is tracked through website feedback forms, traffic metrics (page views, unique visitors, time on site, bounce rate), and conversion rates
. e-ROI methodology tracks user behaviour after website visits through re-contact surveys to calculate return on investment
.
• Measuring "Place" Effectiveness: For point-of-purchase (POP) communications, effectiveness can be seen in increased store traffic and enhanced sales
. Studies on store image and its attributes help assess how store environment influences consumer perceptions and sales
.
• Measuring "Product" and "Price" Effectiveness: These are often assessed indirectly through their impact on brand awareness, attitude, and sales as measured in advertising and promotion effectiveness studies
. Product characteristics are considered in strategic advertising research. Price impacts profit margins and can affect sales volume; its impact on profitability can be analyzed in conjunction with promotion effectiveness
.
The emphasis is on quantifiable, concrete objectives set at the beginning of a campaign, using before-and-after measurements and control groups where possible, while acknowledging the challenge of isolating effects due to interaction with other marketing mix variables and competitive actions
.
What composite indicators capture mix synergy rather than siloed P-level outputs?
The sources emphasize the importance of synergy within the marketing mix, where instruments are designed to be "mutually reinforcing"
. The goal of integrated communications is to achieve a "seamless" or "homogeneous" effect, where the collective effort creates "added value" compared to individual tools
.
While the sources don't explicitly name "composite indicators" like a specific index or formula for synergy, they describe how overall brand-level metrics capture this integrated effect:
• Brand Awareness, Image, and Equity: Instead of measuring the effect of a single element (e.g., advertising recall), IMC effectiveness measurement should focus on techniques that assess the effectiveness of a "total campaign at the brand level"
. This includes tracking changes in top-of-mind brand awareness, brand attitude, brand preference, and overall brand image. The Red Bull example illustrates how combined communication tools (buzz marketing, outdoor marketing, POP materials, sampling, TV ads, sponsoring) generated a higher impact on brand equity than any single tool could have
.
• Customer Loyalty and Relationship Measures: The shift towards relationship marketing means that metrics related to customer loyalty, customer share (quantity and frequency of purchases per customer), and customer lifetime value inherently reflect the combined effectiveness of the marketing mix in building long-term customer relationships
.
• Overall Sales and Market Share: While difficult to isolate, the ultimate goal of the integrated marketing mix is long-term sales and market share growth
. The challenge is to attribute these to the mix as a whole rather than siloed efforts, necessitating models that consider the interplay of all marketing mix instruments, competitive actions, and environmental factors
.
These indicators move beyond individual "P" outputs to reflect the collective impact of an effectively integrated marketing mix on consumer perception, relationships, and commercial results.
The sources emphasize the importance of synergy within the marketing mix, where instruments are designed to be "mutually reinforcing". The goal of integrated communications is to achieve a "seamless" or "homogeneous" effect, where the collective effort creates "added value" compared to individual tools
.
While the sources don't explicitly name "composite indicators" like a specific index or formula for synergy, they describe how overall brand-level metrics capture this integrated effect:
• Brand Awareness, Image, and Equity: Instead of measuring the effect of a single element (e.g., advertising recall), IMC effectiveness measurement should focus on techniques that assess the effectiveness of a "total campaign at the brand level"
. This includes tracking changes in top-of-mind brand awareness, brand attitude, brand preference, and overall brand image. The Red Bull example illustrates how combined communication tools (buzz marketing, outdoor marketing, POP materials, sampling, TV ads, sponsoring) generated a higher impact on brand equity than any single tool could have
.
• Customer Loyalty and Relationship Measures: The shift towards relationship marketing means that metrics related to customer loyalty, customer share (quantity and frequency of purchases per customer), and customer lifetime value inherently reflect the combined effectiveness of the marketing mix in building long-term customer relationships
.
• Overall Sales and Market Share: While difficult to isolate, the ultimate goal of the integrated marketing mix is long-term sales and market share growth
. The challenge is to attribute these to the mix as a whole rather than siloed efforts, necessitating models that consider the interplay of all marketing mix instruments, competitive actions, and environmental factors
.
These indicators move beyond individual "P" outputs to reflect the collective impact of an effectively integrated marketing mix on consumer perception, relationships, and commercial results.
A firm's ability to adjust its marketing mix in real time is strongly determined by organizational capabilities that overcome traditional barriers to integration and foster responsiveness. Key capabilities identified in the sources include:
• Strategic Integration of Departments: Traditionally, advertising, public relations, sales promotions, and personal selling are managed by separate divisions that "seldom communicate with each other, let alone take account of each other’s priorities or integrate their efforts"
. The ability to adjust in real time requires a "strategic integration" of these departments, ideally with a single communications manager having the authority to "supervise and integrate all the specialised communications functions"
.
• Overcoming Functional Specialisation and Bureaucracy: Companies often grow accustomed to "extreme specialisation" in marketing communications, where "specialisation is rewarded and highly regarded, and the need for, or benefits of, integration are overlooked"
. Overcoming these "strong barriers" such as existing hierarchical structures, "turf battles," and "ego problems" is crucial for real-time adjustment
.
• Effective Internal Communications: A prerequisite for an effective internal communications strategy is "an environment that values free expression of ideas, tools such as suggestion boxes, quality circles, meetings and committees, and the willingness of the management to take suggestions and criticism into account"
. This ensures consistency between external claims and employee behaviour, which is vital for agile responses.
• Data-Driven Decision Making and Market Research: The capacity to conduct market research to meet specific consumer needs and to use sophisticated database techniques (e.g., for direct marketing and e-marketing) enables firms to detect and respond to "changes in needs" and offer "the right products at the right moment"
. The ability to gather and analyze real-time consumer data (e.g., website analytics, scanner data for promotions) is fundamental for quick adjustments
.
• Flexibility and Preparedness for Change: Companies need to be "alert and prepared to adapt budgets to changing situations"
. Some companies use "contingency budgets" and "contingency plans" for financing quick management actions in response to unexpected market changes or competitive actions, which implies a pre-planned agility
.
• Technological Adoption and IT Integration: Leveraging new technologies such as the internet, mobile marketing, and interactive digital television allows for "two-way mass conversations" and "real interactivity"
. Critically, online applications should enable marketers to "efficiently interact with their target groups, and marketers should only develop campaigns that can be technically handled by the IT department"
.
In essence, the ability to adjust the marketing mix in real time hinges on an integrated, flexible, data-savvy, and internally communicative organizational structure that is willing to break down silos and embrace technological advancements.
• External factors significantly influence marketing mix decisions in D2C e-commerce. Technology plays a crucial role, affecting communication in various contexts, including professional settings. The increasing penetration of the internet and mobile phones, along with the rise of new interactive media, is fundamentally changing the nature of marketing communications interactivity, as consumers' media attention is fragmenting
.
• Specifically:
◦ Platform Algorithms and Search Engine Optimization: Online marketing communications often require consumer action as the internet is a "pull medium"
. To attract visitors, marketers use a combination of offline and online techniques, including search engine optimization to improve listings in search engines. This is crucial because a significant percentage of web users (47%) use search engines, and top results get much more traffic. These optimization methods rely on factors like metatags, page titles, reciprocal linking, and hidden keywords, which influence how search engine robots behave
. This suggests that how platform algorithms rank content directly impacts visibility and thus "place" and "promotion" strategies in e-commerce.
◦ Behavioural Advertising: There is a new generation of marketing practices that use sophisticated "behavioural advertising" techniques to learn about viewer interests and provide tailored messaging
. This kind of personalization, driven by user data, is an external technological factor that shapes communication and promotion efforts
.
◦ Regulation and Privacy Issues: Privacy and legal issues have been a "hot and controversial issue" in the e-mail marketing industry
. Most markets now restrict and regulate the use of commercial e-mails, forbidding spam (unsolicited e-mails) and requiring opt-out possibilities in Europe. This directly impacts "promotion" strategies, forcing companies to adopt permission-based marketing based on trust. Information policy, as a set of guidelines, regulations, and laws, determines how information can be stored, provided, and used, ensuring secure, accurate, and compliant handling of information. This regulatory environment is an external factor influencing the entire marketing mix, particularly promotion and data governance.
• The provided sources discuss budgeting methods, sales promotions, and customer retention. However, they do not contain specific information or studies that directly measure the effects of shifting budget from ‘promotion’ to ‘place’ logistics on customer retention.
• The sources do mention:
◦ Budgeting: Companies often review communications budgets, and their level is a determinant of mix effectiveness, sales, and profits
. There is no ideal formula, and decisions should be based on concrete marketing and communications objectives
.
◦ Promotion and Retention: Sales promotions can be used to induce repeat purchase or reward loyal customers to prevent them from trying a competitor's product
. Promotions can also lead to "deal-proneness," where consumers adjust their price expectations, potentially leading to a decrease in "reference price". If a promotion campaign only leads to a "post-promotion dip" that compensates for extra sales, the company only gives up profit margin. Frequent use of promotions can lead to a "prisoner's dilemma" where competitors retaliate, and long-term market shares are not affected
.
◦ Customer Retention and Loyalty Programs: Customer loyalty programs and direct marketing aim to retain customers and build long-term relationships
. The internet is well-suited for this, offering addressability, interactivity, customization, and on-demand availability to enhance loyalty
.
• While the importance of both promotion and customer retention is discussed, the direct impact of reallocating budget between these specific elements (promotion vs. place/logistics) on customer retention is not detailed.
• An eco-friendly product redesign, when price is held constant, can influence willingness-to-pay through consumer perception and motivation:
◦ Increased Healthiness Perception: Colour packaging, such as green or blue, can increase the perception of healthiness but may lower tastiness expectation
. While this refers to packaging, it suggests that visual cues related to "eco-friendliness" could similarly influence perceptions of a product's positive attributes.
◦ Consumer Motivation and Information Processing: For consumers to be motivated, they should feel the "need for" health-related information
. This implies that if "eco-friendliness" aligns with consumer values or a perceived need, they might be more receptive to and value such redesigns.
◦ Willingness-to-Pay for Ethical Products: Research indicates that a significant percentage of European consumers (46% on average) are willing to pay substantially more for ethical products
. A study on fair-trade coffee found that "fair-trade lovers" (11% of the sample) were most prepared to pay the actual price premium. This suggests that an eco-friendly redesign, perceived as an ethical attribute, could increase the perceived value and, consequently, the willingness-to-pay, even if the price remains constant. The value proposition is enhanced by the non-monetary, ethical benefits
.
◦ Bounded Rationality and Ethical Decisions: Bounded rationality can sometimes lead to more ethical decisions, as decision-makers may "settle" for choices that benefit people or causes outside themselves, even if it means a higher cost
. This implies that consumers, in their "good enough" decision-making, might value the ethical aspect of an eco-friendly product.
• While the sources do not explicitly project to 2035 or widespread AI-generated personalization, they provide insights into personalization and AI's current roles that can infer potential changes to the marketing mix:
◦ Increased Targeting and Personalization: The internet already offers capabilities for one-to-one communication, customization, and tailoring value propositions based on customer data and behaviour
. This allows marketers to identify self-selected users, enhance loyalty, and customize products and services. With widespread AI-generated personalization, this trend would intensify, making marketing communications even more "intentional" and "personalised"
.
◦ Product (P): AI could allow for highly customised product offerings based on individual preferences derived from vast datasets, moving beyond current "mass customisation" to true individualization
. The evaluation of product suitability would be driven by highly granular customer expectations and needs
.
◦ Price (P): Pricing strategies could become more dynamic and individually tailored (e.g., value-based pricing based on perceived individual value) rather than relying on broad segments
. AI could optimise pricing for each customer, potentially making price skimming or competition-based pricing highly precise
.
◦ Place (P): Distribution channels (both physical and digital) would need to be optimised for individual customer accessibility
. AI could predict where and how individuals prefer to purchase, influencing decisions on online platforms, specific physical locations, or even direct-to-consumer models
.
◦ Promotion (P): Promotional strategies would shift even more towards hyper-targeted messages delivered through preferred channels at optimal times
. Advertising campaigns would be designed to resonate on an individual level, potentially moving away from broad mass media approaches to highly customized digital and direct marketing efforts. The focus would be on "reaching the hearts and minds of consumers" through clear and persuasive messaging that communicates a product's individual value
.
◦ Enhanced Customer Relationship Management (CRM): AI would significantly advance e-CRM, allowing for cheaper and faster management of electronic relationships with customers
. This enables companies to deliver tailored information and services through self-service tools, shifting from direct employee interaction to customer empowerment in the buying and servicing process
.
◦ Overcoming Bounded Rationality: AI tools, with specific details incorporated into requests, can generate better results
. This suggests that AI could help consumers make more "optimal" rather than just "good enough" decisions, potentially by providing them with perfectly personalized information and choices, thereby altering traditional marketing's role in influencing "satisficers"
• The provided sources do not contain any information about "subscription models" or their potential impact on the salience of "price" in consumer markets.• The sources discuss various pricing strategies, such as price skimming, competition-based pricing, premium pricing, value-based pricing, and cost-plus pricing. They also detail how price is communicated as part of the marketing mix, conveying quality or exclusivity. However, there is no discussion on how alternative payment structures like subscription models might alter consumer perception of price.
• The 4 Ps framework (Product, Price, Place, Promotion) has been traditionally used for goods. When applied to services, the sources suggest intrinsic limitations that led to the expansion of the mix:
1. Exclusion of Service Delivery Elements (Process, People, Physical Evidence): The traditional 4 Ps focus on tangible products and their marketing
. However, for services, crucial elements related to their intangible nature and delivery are not adequately captured. This led to the addition of the "extra 3 Ps":
▪ Process: The delivery of the product/service
. This is vital for services, as the experience of receiving the service (e.g., efficiency, interaction steps) is part of the offering itself.
▪ People: The "face of the company," including customers, clients, and employees directly or indirectly involved in selling, designing, or marketing the product/service
. For platform-economy services, the interaction with platform personnel or other users is often central to the service experience, which the 4 Ps do not cover.
▪ Physical Evidence: The appearance or tangible cues of a service
. While platform-economy services are digital, their interface design, user experience, and branding elements serve as "physical evidence" in the digital realm. The original 4 Ps do not explicitly account for these service-specific tangible cues.
2. Focus on Transactional vs. Relational Aspects: The traditional 4 Ps tend to lean towards a transactional view of marketing. However, services, especially in the platform economy, often emphasize building long-term relationships and continuous engagement
. The sources highlight that direct marketing and e-CRM aim for "lifetime bonding of customers" and "one-to-one relationships"
. The original 4 Ps are less equipped to fully encapsulate strategies focused on ongoing customer interaction and loyalty beyond single transactions.
3. Limited Scope for Interactive and User-Driven Value Creation: Platform-economy services often involve significant user participation and interaction, where value is co-created with the consumer (e.g., user-generated content, community features)
. The 4 Ps primarily describe how a company pushes its offering to a market. They do not intrinsically account for two-way communication, interactivity, and the shifting power balance towards the consumer, where the "receiving consumer decides what he or she will be exposed to and how he or she will react to it". This interactive and user-centric nature of platform services goes beyond the traditional outbound communication implied by the "promotion" P.
• Aggressive promotion strategies, particularly in advertising and sales promotions, can lead to several negative externalities:
◦ Consumer Irritation and Advertising Avoidance: Frequent exposure to messages can initially increase learning but may later lead to boredom and irritation (wear-out effect)
. This irritation can cause consumers to avoid advertising (e.g., zapping TV commercials, refusing leaflets, blocking online ads). Certain ad content, such as "unbelievable, exaggerated, overdramatised situations," "unsympathetic characters," "brand comparisons," and "information-oriented appeals" with too many arguments, can also increase irritation
.
◦ Brand Confusion: Advertising, especially with a high degree of "communications clutter," can contribute to brand confusion
. Factors like brand name similarity, reduced inter-brand differences, willful brand imitation (e.g., package shape/size, label style), and high competition can increase this risk. When emotional content distracts consumers, it can lead to less brand recall and more brand confusion, where "everybody knows the ad, but nobody knows the brand advertised"
.
◦ Negative Impact on Brand Image and Profitability (for Sales Promotions): While effective in the short term, frequent sales promotions can give a brand a reputation of "cheapness" and destroy the perception of its intrinsic qualities, potentially damaging its long-term image and profit potential
. They can also lead to "deal-proneness," where consumers become accustomed to discounts and expect more impressive promotions in the future, thereby reducing the "reference price". Promotions can also lead to a "post-promotion dip" in sales where increased sales during the promotion are offset by later drops, meaning the company only gives up profit margin
.
◦ Ethical Concerns and Manipulation: Aggressive marketing communications are sometimes accused of exploiting anxieties, employing "intensive persuasion that amount to (hidden) manipulation," and trivializing complex situations into stereotypes
. They can be seen as "inherently unfair and deceptive," particularly when targeting vulnerable groups like children, who may lack the cognitive skills to resist persuasive claims. Covert marketing techniques like brand placement can be considered unethical if viewers are unaware of the commercial intent. Salespeople, in aggressive selling, might be perceived as having low ethical standards, using questionable psychological techniques, or making false promises
.
◦ Societal Impacts (Externalities): "Externalities" are described as "previously invisible costs now quantified"
. While this primarily refers to environmental and social impacts being reported, aggressive promotion can create a materialistic culture of "conspicuous consumption" and overspending, leading to broader societal concerns beyond individual consumer harm
• Governments can use various policy levers to steer firms towards greener choices within their marketing mix, drawing on regulation, information, and ethical considerations:
1. Mandatory Sustainability Reporting and Due Diligence (Product/Promotion): Governments can mandate comprehensive sustainability reporting, similar to the European Sustainability Reporting Standards (ESRS) or concepts like Double Materiality
. This requires firms to report on their "inside-out impact" (company's effects on environment and society) and "outside-in risk" (sustainability-related risks affecting the firm). By quantifying environmental and social externalities, this addresses hidden risks and fosters innovation. This encourages greener product design and honest promotion by making companies accountable for their environmental footprint. Due Diligence on human rights, environment, and labor practices
would also ensure that companies investigate and address these aspects throughout their supply chains, influencing product and place decisions.
2. Regulation of Marketing Claims and Labelling (Promotion/Product): Governments can implement and enforce clear definitions and regulations for environmental and health claims on products, such as "nutrition claim" definitions or "front-of-pack" labelling schemes
. This helps prevent "greenwash" (misleading environmental claims) and ensures market transparency. By regulating terms like "organic," "sugar-free," or "cage-free," governments ensure consumers are not misled by vague qualifiers that don't mean what they assume, steering firms towards genuinely greener products if they want to use such claims
. This directly influences the "product" itself and the "promotion" of its attributes.
3. Incentivising Sustainable Supply Chains (Place): Governments can introduce policies that incentivise and monitor the accomplishment of nutrition strategies and "more general mention of regulation on the marketing of unhealthy products"
. While focused on nutrition, this principle can be extended to environmental sustainability in the "place" component of the marketing mix. For example, policies could promote sustainable supply chains, which are more environmentally friendly, even if they cost more. This steers firms away from solely cost-optimal supply chains towards more sustainable compromises
.
4. Information Policy and Consumer Empowerment (Promotion): Governments can leverage information policy to promote healthier and more sustainable purchases
. This involves using policies to "empower consumers into making what they consider as better choices" by providing clear and transparent information. This aligns with the idea of overcoming information asymmetry in the market. By promoting consumer knowledge and tackling consumer confusion regarding environmental issues, the government indirectly steers firms to offer genuinely greener products that can be transparently communicated. This could involve government-backed labels or educational campaigns to help consumers understand environmental impacts.
• To best ensure that place decisions (distribution channels, supply chains) align with fair-labour standards, the following two organizational interventions are strongly supported by the sources:
1. Implementing Comprehensive Supply Chain Transparency and Audit Systems (Process/Physical Evidence):
▪ Companies can implement "Detailed tracing of products from origin to consumer to ensure ethical sourcing and sustainable practices throughout the supply chain"
. This involves establishing a robust "supply chain audit system"
. Such systems would provide the visibility needed to monitor and verify labour practices at different stages of the supply chain.
▪ This aligns with the concept of "Due Diligence" which involves human rights, environment, and labor practices
. Managers' primary concerns include balancing costs with reputation and available capabilities and resources when making supply chain decisions. Ensuring fair-labour standards aligns with maintaining reputation and ethical considerations
.
2. Fostering Internal Communication and Employee Commitment to Corporate Ethical Values (People/Process):
▪ Companies must ensure that internal communication involves employees in the strategic priorities of the company
. This means not only communicating strategy internally but also ensuring it is compatible and workable for employees. If employees are convinced of the basic strategic priorities, including ethical ones, and are trained, they will behave accordingly in their contacts with external audiences
.
▪ This is crucial because the sources indicate that employees and their engagement show to the brand has never before been more important, especially in service branding, internal marketing is vital
. A company's employees and the engagement they show to the brand are critical, particularly as they can be the only contact a customer has with the company. "Corporate ethical values" have a positive effect on the perceived role of ethics in a firm's success. By aligning employee behaviour with fair-labour commitments through internal marketing and training, the company ensures that its "People" (internal aspect of the marketing mix) reinforce the fair-labour commitment in its "Process" (supply chain management and external communications).
2. Marketing mix. ChatGPT o3
Key take-aways (one paragraph)
The “marketing mix” is still the standard way most textbooks organise controllable managerial levers, yet the classic 4 Ps (Product, Price, Place, Promotion) have gradually broadened (to 7 / 8 Ps) as services, digital commerce, and sustainability concerns exposed blind spots. Definitions remain consistent—tools for creating customer value and capturing it—but weights, metrics, and even the relevance of some Ps now differ sharply between digital-first firms, platform businesses, and traditional retailers. Empirical evidence shows that causally optimising the mix (via modern causal-MMM or field experiments) can lift customer-lifetime-value, although many published “optimisations” are only correlational. Looking ahead, AI-driven personalisation, subscription models, and ecological imperatives will keep eroding the primacy of “Price” and amplifying “Process”, “People”, and “Physical evidence”, demanding new composite indicators and policy interventions.
1. Formal textbook definitions
2. 4 Ps vs 8 Ps
Table 66
Scope
4 Ps
Extra Ps (services/digital)
Typical context
Scope
4 Ps
Extra Ps (services/digital)
Typical context
Elements
Product, Price, Place, Promotion
People, Process, Physical evidence, Performance (or Productivity)
Service brands, experience goods, digital platforms
There are no rows in this table
3. Mix vs Integrated-Marketing-Communications (IMC)
4. Digital-first vs traditional retailers
5. Does mix optimisation raise CLV?
6. Why product-line breadth alters price elasticity
7. From Borden to McCarthy and beyond
8. Socio-economic shifts reshaping P weights (1975-2025)
9. Suitability for sustainability marketing
)10. Inclusive-design tensions
11. Why ‘Promotion’ dominates budgets
12. Service-Dominant-Logic (SDL) criticisms
13. Measuring each P in multi-channel campaigns
)14. Capabilities for real-time adjustment
15. External factors dominating D2C mix choices
16. Shifting budget from Promotion → Place
17. Eco-friendly product redesign holding price constant
)18. AI-generated personalisation (to 2035)
19. Price salience under subscriptions
20. Three intrinsic 4 Ps limits for platform services
21. Negative externalities of aggressive Promotion
22. Four government policy levers for greener mixes
23. Two organisational interventions for fair-labour ‘Place’
Sources consulted: Kotler & Keller; GrowthShuttle; Investopedia; ScienceDirect journals; OECD; EY; ILO; MIT SMR; HBS WK; Medium; etc. (Full list above via inline citations).
24. Marketing Mix alternatives. ChatGPT
TL;DR Managers who find the 4 Ps too product-centric can switch to customer-, journey-, platform-, or sustainability-oriented toolkits. Key stand-ins include the 4 Cs, SIVA, SAVE, 4 As, 4 Es, RACE, PESO, 7 Cs Compass, Business-Model Canvas, Jobs-to-Be-Done, Service-Dominant Logic, and Triple-Bottom-Line/5 Ps. Each reframes value creation—toward needs, outcomes, ecosystems, or planetary limits—and is empirically used in contexts where the classic mix underperforms.
All marketing mix alternatives
Name
Elements
Fixed which 4 P blindspot
Best fit context
4P analog
Type
Notes
Name
Elements
Fixed which 4 P blindspot
Best fit context
4P analog
Type
Notes
5 Ps of Sustainable Marketing: adds Purpose (or Prosperity) to orient decisions to long-term social value ().
Adds
Sustainability & Purpose
Open
4 Cs (Lauterborn, 1990)
Consumer wants, Cost, Convenience, Communication
Consumer marketing, UX research
All?
Customer-centric
Open
SIVA (Dev & Schultz, 2005)
Solution, Information, Value, Access
Knowledge-intensive B2C/B2B
All?
Customer-centric
Open
SAVE (HBR, 2013)
Solution, Access, Value, Education
Complex B2B offerings
All?
Customer-centric
Open
4 As (Kotler-Sheth)
Acceptability, Affordability, Accessibility, Awareness
Emerging-market strategy
All?
Customer-centric
Open
4 Es (Ogilvy): Experience, Exchange, Evangelism, Everyplace—prioritises post-purchase advocacy and ubiquity ().
All?
Experience & engagement lenses
Open
7 Cs Compass (Shimizu): puts Consumer at the pivot, surrounded by Corporation, Commodity, Cost, Channel, Communication, Circumstances—integrates macro factors ignored by the 4 Ps ().
All?
Strategic / business-model toolkits
Open
3 Cs (Ohmae): Customer, Company, Competitor—strategy triad when distribution & comms are less malleable (e.g., utilities).
All?
Strategic / business-model toolkits
Open
Business-Model Canvas: nine blocks spanning value prop, partners, revenue; joins marketing with operations & finance ().
All?
Strategic / business-model toolkits
Open
Triple Bottom Line / 3 Ps: People, Planet, Profit—makes externalities explicit in mix design ().
All?
Sustainability & Purpose
Open
Service-Dominant Logic (Vargo & Lusch): abandons “mix” metaphor; value is co-created in use, so levers become service ecosystems, operant resources, institutional arrangements ().
All?
Service-ecosystem & platform logics
Open
Platform Governance toolkits: treat network effects, algorithms, data policies as core levers—areas unaddressed by any P or C.
All?
Service-ecosystem & platform logics
Open
Shared value approach
All? Product?
Sustainability & Purpose
Open
Jobs-to-Be-Done: segments by “job” rather than demographics, guiding product, comms, and pricing simultaneously (, ).
Product, Pricing, Communication
Strategic / business-model toolkits
Open
RACE (Smart Insights): Reach, Act, Convert, Engage—a data-loop planning map for digital funnels (, ).
Promotion
Experience & engagement lenses
Open
PESO: Paid, Earned, Shared, Owned media architecture; replaces “Promotion” with channel orchestration ().
Promotion
Experience & engagement lenses
Open
There are no rows in this table
1 Customer-centric re-mappings of the 4 Ps
Table 67
Framework
Elements
Fixes which 4 P blind spot?
Best-fit context
Framework
Elements
Fixes which 4 P blind spot?
Best-fit context
4 Cs (Lauterborn, 1990)
Consumer wants, Cost, Convenience, Communication
Consumer marketing, UX research
SIVA (Dev & Schultz, 2005)
Solution, Information, Value, Access
Knowledge-intensive B2C/B2B
SAVE (HBR, 2013)
Solution, Access, Value, Education
Complex B2B offerings
4 As (Kotler-Sheth)
Acceptability, Affordability, Accessibility, Awareness
Emerging-market strategy
There are no rows in this table
2 Experience & engagement lenses
3 Strategic / business-model toolkits
4 Sustainability & purpose frames
Biomimicry / Regenerative product design
Product (what is offered, materials, features)Process, Physical Evidence
Adidas’s Mylo™ mushroom-leather sneakers embody “nature-as-stakeholder”.
Direct Trade / Exit-to-Community
Price (transparent cost-plus, value sharing)People, Place
Coffee roasters that publish farm-gate prices & share profits with growers.
Bioregioning / Local stewardship
Place (distribution footprint)Product, People, Promotion
A dairy limiting sales to its watershed, using “grown-here, consumed-here” messaging.
Self-Management / Cooperatives
People (staff roles, customer co-creation)Process, Promotion
Worker-owned groceries where staff & shoppers vote on SKUs.
Slow Productivity / Embodied Work
Process (pace, workflow, quality checkpoints)People, Product
A bakery that halves SKU count and moves to three-day sourdough cycles.
Mutual Aid / Emergent Community Design
Promotion (storytelling, community co-marketing)People, Price
A meal-kit brand hosting “cook-and-share” nights instead of influencer ads.
There are no rows in this table
All Sustainability
Narrative / concept (source)
🔑 Primary P(s) moved
↔️ Other Ps it tends to ripple through
One-line angle
Narrative / concept (source)
🔑 Primary P(s) moved
↔️ Other Ps it tends to ripple through
One-line angle
Exit-to-Community
People
Price, Promotion
Shifts ownership to users/stakeholders instead of VCs.
Journeyman craft / mastery
People
Process (slower, artisanal flow); Product (hand-made cues); Price (wage cost premium)
Centres on skilled employees, apprenticeship culture and fair remuneration; quality is transmitted through the people who make/serve the offer.
Maximum Wage
People
Price (cost structure), Promotion (CSR narratives)
A wage-cap is an internal HR choice first; signals egalitarian values to staff and society.
Work-Life Integration
People
Process (asynchronous schedules), Place (hybrid hubs), Promotion (employer-brand storytelling)
Re-draws who the organisation acknowledges as a whole person and blurs the home/office boundary
Good-Enough Job
People
Price (living-wage comp bands), Promotion (anti-hustle messaging), Process (shorter appraisal cycles)
Sets a humane floor rather than a sky-high ladder of status; reframes ambition around sufficiency and wellbeing
Portfolio Careers
People
Process (gig-board platforms), Price (fractional comp models), Promotion (alumni advocacy)
Treats staff as multi-project, multi-identity contributors—HR orchestrates rather than owns talent
New Ambition
People
Promotion (purpose metrics), Price (mission-tied bonuses), Performance (8th P)
Re-codes winning as impact + balance rather than endless growth (see sports-team “perform at top level, but…” narrative)
Symbiotic Relationship
People
Builds long-run, mutually beneficial ties between firm and stakeholder—classic relationship-marketing terrain
Process (joint decision loops), Promotion (co-authored stories), Price (value-sharing schemes)
Nature as Stakeholder
People
Adds ecosystems to the stakeholder map, giving rivers, soils and species formal voice in decisions
Process (environmental-guardian seats in governance), Place (operations moved off fragile habitats), Promotion (nature-signed campaigning)
Kinship Calibration
People
Periodic tuning of relationships—checking power, reciprocity, psychological safety inside teams
Process (relational OKRs), Promotion (internal storytelling about allyship)
Team-building Web Weaving
People
Cultivates dense social networks rather than siloed org charts—“connective tissue” work
Process (peer-mentorship webs), Physical Evidence (network maps in offices), Promotion (celebrating cross-team wins)
Empowerment
People
Gives staff/customers real agency—budgets, tools, votes.
Process (self-service flows), Promotion (user-made content), Price (value-share models)
Echo Culture
People
Builds internal norms that “amplify what works” through peer repetition and story cascades.
Promotion (echo-friendly formats), Process (retro loops), Product (co-created riffs)
Work to Live
People
Re-codes success from hours-worked to life-well-lived; HR policy and norms shift first.
Process (shorter weeks, right-to-disconnect), Price (living-wage floors), Promotion (“anti-hustle” employer brand)
Purpose
People
Starts with shared “why” inside the culture; everything else syncs to that north-star.
Promotion (mission storytelling), Performance (purpose KPIs), Product (impact-aligned roadmap)
Time Keepers
People
Appoint roles tasked with protecting focus blocks & cadence (meeting bouncers, sprint sheriffs).
Process (time-boxing rituals), Promotion (“we honour time”), Performance (flow-minutes per week)
Fun-Ops Team
People
A cross-functional crew designs play into ops (Slack memes, surprise demos, mini-fêtes).
Process (fun sprints), Promotion (behind-the-scenes joy content), Physical Evidence (game corners, celebratory swag)
Self-Management / Holacracy / DAOs
People
People. Yes—it’s one of the most mature self-management operating systems. In marketing-mix terms it tweaks the People P first (it abolishes bosses and puts authority in roles), then ripples into Process (governance meetings), Promotion (employer-brand story) and Price (profit-sharing).
Process, Promotion
Decentralises decisions; employees become brand storytellers.
Steady-Growth Councils
People – cross-stakeholder committee that polices pace
Process (gate reviews), Performance (impact vs. size KPIs)
Enoughness
People – cultural norm: celebrate “done” not “maxed”
Process (stop-rules in projects), Promotion (stories of restraint)
Enoughonomics Team
People – internal working group that embeds sufficiency KPIs
Performance (annual “enough score”), Promotion (exec reports)
Somatic Therapy @ work
People (body-based wellbeing programs)
Physical Evidence (movement zones), Process (embodied check-ins), Promotion (care narrative)
HI – Human Intelligence
People (doubling down on uniquely human judgment alongside AI)
Process (human-in-the-loop checkpoints), Promotion (“human-made” seal), Product (explainable features)
Egalitarian Enterprise
People (flattened hierarchy, equal voting)
Price (cap on pay ratios), Process (consent decision-making), Promotion (fairness narrative)
Collab Architects
People (roles that curate collaboration rather than command)
Process (facilitation tool-kits), Physical Evidence (open project walls), Promotion (behind-the-scenes storytellers)
Inner Rewilding Sabbatical
People (staff take time in nature to reset)
Process (coverage rosters), Promotion (brand-as-caretaker), Physical Evidence (nature stipend gear)
Regenerative Leadership
People • Process
Product, Promotion
Leads re-design culture so the org behaves “in harmony with life.”
Mycelium Management
People → Process
Uses fungal networks as metaphor: decentralised nodes exchange nutrients (info/resources) in real time
Product (open APIs), Place (distributed micro-hubs), Promotion (stories of emergent innovation)
Citizens / People —not Consumers → squarely a People lever
People. The move from “targeting consumers” to cultivating citizens or whole persons rewrites who you believe is sitting across the table. In Jon Alexander’s words, it swaps the 80-year-old “Consumer Story” (self-interest, competitive choice) for a “Citizen Story” that asks people to show up as contributors to shared outcomes, not just buyers of stuff. Simon Sinek makes the shift even starker: “Customers should never be the priority. People should be the priority.”
Because it fundamentally re-assigns identity and power, the concept lands first in the People P of the 7-Ps mix.
How the ripple travels through the rest of the mix
P What changes once you speak to citizens rather than consumers
Process Decision making opens to citizen panels, participatory budgeting, “open inbox” product road-mapping.
Promotion Messaging shifts from persuasion to mobilisation—storytelling invites dialogue, pledges, co-creation hacks.
Product Offers are designed for civic outcomes (e.g., urban-garden kits, repair-friendly devices) rather than disposability.
Price Models reward stewardship—subscription credits for repairs, tiered pricing that funds community projects.
Place Distribution favours local or mission-aligned channels (farm-share pick-ups, co-op stores, neighbourhood pop-ups).
Physical Evidence Touch-points display impact dashboards, citizen charters, QR links to policy forums.
Worker ownership
People. Again chiefly a People lever—ownership, voting rights and surplus-distribution live in the people domain, as we noted for co-ops earlier.
Co-operatives → first and foremost a People lever
People. Because a co-op transfers ownership and governance to those who work in, buy from or otherwise rely on the firm, it rewrites who holds power inside the organisation—the very heart of the People P. In co-ops, members vote, share surplus and co-create policy, so the human stakeholder architecture—not the product catalogue or the price list—is what changes first.
How the ripple travels through the rest of the 7 Ps
P What typically shifts once the business converts to a co-op model
Process Democratic workflows (one-member/one-vote, participatory budgeting, transparent board minutes) become part of everyday operations.
Price Surplus is returned as patronage dividends or reinvested; pricing often aims at sufficiency rather than maximisation, reflecting member rather than investor priorities.
Promotion Storytelling leans on “owned by the people you meet” narratives; marketing budgets skew toward community education and word-of-mouth advocacy.
Product Offers evolve through member proposals—e.g., a worker co-op bakery adding gluten-free lines after staff feedback.
Place Distribution stays close to the member base (local stores, CSA drop-points), reinforcing the community ownership link.
Physical Evidence Spaces and pack design showcase governance transparency—posters of the co-op principles, QR links to annual impact reports, member portraits in-store.
On-boarding Nature → chiefly a People lever
People. The idea is to “treat the living world as a colleague you have to induct, build trust with and listen to” rather than an external resource. That language squarely rewrites who counts as a stakeholder inside the organisation’s culture and decision-making – i.e., the People P of the 7 Ps. How it ripples through the rest of the mix P What changes once Nature is formally “on-boarded”? Process Governance tools (impact screens, nature-proxy board seats) are embedded in everyday workflows. Product Offers are (re)designed for ecological fit – biomaterials, circular specs, end-of-life take-back. Place Sourcing and distribution optimise for local ecosystems (bioregion logic). Promotion Story shifts from “green claims” to first-person narratives of co-creating with nature. Physical Evidence Biophilic offices, carbon-negative packaging, ecosystem health metrics on packs. Price Value captured includes ecosystem services; pricing models may fund restoration funds.
New Schools of Organising / Managers → Organisers” → first and foremost a People lever
People. The rallying cry that “managers are done—long live organisers” reframes who holds power, voice and responsibility inside the firm. It moves attention from command-and-control roles to facilitative, community-weaving roles, exactly the domain of the People P of the 7-Ps mix. The literature around “schools for organising” argues for educating organisers who convene, coach and steward collaboration rather than supervising it.
How the shift cascades through the other Ps
P What tends to change when you replace managers with organisers
Process Decision-making becomes participatory (circles, consent, advice), budgets turn into open-allocation pools, and review cycles become peer-driven.
Promotion Storytelling pivots from “leadership vision” to “collective authorship”; organiser voices and community narratives dominate channels.
Product Feature road-maps emerge from live user forums and cross-functional swarms rather than top-down gantt charts.
Place Hub-and-spoke or fully distributed models flourish, with organisers choreographing local gatherings and knowledge-flows.
Price Surplus often flows back to contributors (e.g., patronage or revenue-share), reflecting organiser-era equity norms.
Physical Evidence Workspaces signal flat hierarchy—movable furniture, project walls anyone can edit, transparency dashboards replacing executive suites.
Feel-Good Metrics
Performance
Tracks emotional & societal uplift (joy index, mental-health score) over vanity clicks.
Promotion (impact reports), Process (UX happiness gates), Product (delight cues)
Zebras (profit + purpose enterprises)
Performance (8th P)
People, Price
Targets sustainable profit and social impact—black and white.
Gives-Me-the-Chills, KPIs
Performance (8th P)
Tracks depth-of-emotion moments (goose-bump score, awe count) instead of reach alone.
Promotion (storyboards for chills), Product (delight cues), People (experience curators)
Eudaimonic Growth
Performance (8th P)
Measures flourishing rather than raw scale—“are we enabling virtue & wellbeing?”
People (wellbeing roles), Promotion (flourish dashboards), Price (value-share models)
Sufficiency Metrics
Performance (8th P) – track “well-being per unit sold” rather than revenue alone
People (impact analysts), Promotion (dashboard storytelling)
Biophilic Business
Physical Evidence
People, Product
People (movement stewards), Place (garden work-nooks), Product (natural finishes)
Brings natural light, plants & biomorphic forms into retail/service spaces.
Brings living materials, daylight, scent and tactility into stores & offices to honour humans as nature-bound animals
Business as a Hammock
Physical Evidence
People (wellbeing roles), Process (pulse-check rituals), Promotion (imagery of ease)
Signals psychological & literal support—loungers, quiet pods, cradle-to-cradle interiors
Adventure Off-sites
Physical Evidence (the experiential venue)
People (team bonding), Promotion (content from adventures), Process (reflection workshops)
Re-Animalizing → chiefly a Physical Evidence lever
Physical Evidence. The narrative calls brands to rewild the sensescape—-designing stores, offices, events and even digital touch-points so that sight, sound, smell, texture and movement remind us we are “animals among animals,” not detached brains-on-screens. That makes it first and foremost a redesign of the tangible proof-points (environments, artifacts, packaging, staging) customers and employees encounter—the very job of the Physical Evidence P in the 7-Ps mix.
How the ripple spreads through the rest of the mix
P What tends to shift once you “re-animalize” the brand
People Staff roles morph from “knowledge workers” to “movement stewards”—daily stretch circles, walking meetings, dog-friendly policies, scent-free zones.
Process Workflows adopt circadian or seasonal cadences; product testing includes multi-sensory checkpoints (sound, tactility, scent).
Product Materials favour fur-friendly textures, temperature-responsive fabrics, edible—or at least biodegradable—packaging that feels “alive”.
Place Retail and HQ spaces add earthy floors, daylight niches, rooftop habitats; distribution shrinks to walkable or bike-able radii.
Promotion Campaigns pivot from polished lifestyle shots to playful, full-body storytelling: customers climbing trees, rolling dough by hand, foraging with chefs.
Price “Embodied experience” premiums emerge (e.g., refill discounts if you arrive on foot); wellness dividends fund staff kinesthetic training.
Bioregioning, Bioregional Strategy
Place
Product, Promotion, People
Product (local ingredients), Price (true-cost shows transport savings), Promotion (place-pride storytelling)
Shrinks the footprint to watershed scale; tells the “grown-here” story.
Designs value-chains to fit local ecology and culture; privilege sourcing, hiring, selling within one watershed
Small Is Beautiful / Human-Scale
Place
Price, Product
Optimises for local relevance over mega-scale efficiency.
Boutique
Place – deliberately narrow, high-touch outlets or channels
Promotion (scarcity buzz), Price (experience premium), People (concierge roles)
Localism
Place – design a bioregional footprint: source, make & sell within one watershed
Product (local inputs), Promotion (place-pride), Process (short loops)
Right-Sized & Rooted
Place – match offer scale to local carrying-capacity
Product (terroir variants), Price (true-cost shows saved miles)
Direct Trade / Fair Trade 2.0
Price
People, Promotion, Place
Publishes farm-gate prices and profit splits to build trust.
Post-Growth / Degrowth
Price
Product, Promotion
Measures success in wellbeing & regeneration, not endless revenue.
Shared Value
Price
Extends CSR into a deliberate split of economic surplus among firm, society and planet—“value” is the unit being shared
People (cross-sector partnerships), Promotion (impact dashboards), Product (inclusive design to unlock new markets)
Sufficiency
Price – set “enough” price/volume floors, refuse overstimulation
Promotion (anti-hustle copy), Process (demand-driven batches)
Circularity & Life-Cycle (inc. Endineering)
Process
Product, Physical Evidence, Place
Engineers graceful end-of-life loops and reverse logistics.
Slow Productivity & Embodied Work
Process
People, Product
“Do fewer things, at a natural pace, obsess over quality.”
Chronowork
Process
People
Staff pick schedules aligned to circadian energy peaks.
Seasonal Cycles / Natural Pace Ops
Process
People, Place
Aligns campaigns & launches with ecological or cultural seasons.
Slow Living
Process
Product (simpler, durable); Promotion (storytelling around “time”); Place (local, low-stress)
Slows down production & consumption cadence; privileges mindful pace over speed.
Soft Life
Process
People (no-meeting Fridays), Physical Evidence (calming spaces), Price (premium for slower craft)
Re-paces workflows around ease, rest and “time as the new currency”
Non-Self-Coercive Productivity
Process
People (psych-safety norms), Promotion (case-study content), Product (built-in rest timers)
Designs “getting things done” without guilt loops—uses hot/cold empathy-gap nudges instead of will-power
Decelerators / Downshifting
Process
People (re-skilled managers), Place (regional hubs), Promotion (slow-made labels)
Formal tools (sabbaticals, 4-day weeks) that slow the corporate metabolism
Restoration / Repair
Process
Re-designs the post-purchase workflow to prolong product life and close loops—repair bars, take-back portals, service kits
Physical Evidence (modular, fix-friendly design), Product (spare-part SKUs), Price (deposit or repair-subscription models)
Resilience
Process
Hard-wires risk-aware, adaptive routines—scenario planning, circular supply, decentralised assets—for long-run continuity
Product (multi-use, modular), Place (redundant local hubs), People (cross-skilled crews), Price (insurance-linked guarantees)
Deep-Root Debrief
Process
Ritual after-action reviews that dig for root-causes and shared learning rather than surface KPIs
People (facilitator roles), Promotion (public learning logs), Physical Evidence (visual root-maps on walls)
Roots before Fruits
Process
Invests in soil-level capabilities—skills, culture, supplier health—before chasing scale
People (long apprenticeships), Price (patient-capital terms), Promotion (“slow and steady” narrative)
Root-to-Canopy Mindset
Process
Systems thinking that links soil, trunk and crown—i.e., upstream ops to downstream experience—in one dashboard
People (system-mapper roles), Promotion (whole-system metrics)
Seasonally Synced / Seasonal Cycles / Core Rhythms
Process
People (shift patterns), Product (limited-run variants), Promotion (season-stories)
Alignment
Process
Ensures every project, message and metric lines up with purpose and strategy.
People (shared OKRs), Promotion (coherent story), Performance (alignment KPIs)
Vibe-Driven Decision
Process
Teams green-light ideas that feel right to stakeholders—gut-check gates before data. ()
People (intuition roles), Promotion (mood-testing pilots), Product (micro-drops)
Aligned Activation
Process
Launch playbooks that verify every channel and partner is on-message before go-live.
Promotion (synchronised media burst), People (cross-functional pods), Physical Evidence (coherent look-&-feel)
Flow (Csikszentmihalyi)
Process
Designs tasks, cadence and tooling to keep teams in deep-focus “flow-state.”
People (clarity of goals & skills), Physical Evidence (distraction-free spaces), Promotion (stories of frictionless creation)
De-Atomization
Process
Re-bundles fragmented micro-tasks into coherent, end-to-end chunks so workers feel whole.
People (cross-skill roles), Product (holistic feature sets), Promotion (narrative of wholeness)
De-scaling
Process – break giant systems into small cells
People (autonomous pods), Place (distributed micro-hubs)
Limits
Process – explicit caps on throughput, inventory, ads, etc.
Price (surge-free), Promotion (honest scarcity), Performance (cap-compliance audits)
Organic Growth
Process – reinvest profits from within, no blitz-scaling
People (patient-capital board), Promotion (steady-state narrative)
Slow & Regenerative Practices
Process (deliberate pace, replenishment loops)
Product (durable, repairable), Price (true-cost premiums), Physical Evidence (earthy textures)
Reciprocity Flow / Reciprocity Circling
Process (designing explicit give-and-receive loops in meetings, road-maps)
People (peer-praise rituals), Promotion (stories of mutual aid), Price (value-sharing schemes)
Flowting Time (floating + flow)
Process (flexible time blocks protected for deep work)
People (self-scheduling), Promotion (work-culture signal)
Pause Before Action
Process (micro-sabbaticals, decision cool-downs)
People (mindfulness training), Promotion (“we think before we ship”)
Weave Seasons
Process (planning & review cadence follows natural or cultural seasons)
Place (seasonal pop-ups), Promotion (seasonal launches), People (rota planning)
Flow-Based Operations
Process (pull systems, Kanban, value-stream mapping)
People (flow-facilitator roles), Place (cell-based layout), Price (throughput-based pricing)
Cognitive Load (mind-space limits)
Process (WIP limits, single-task sprints)
People (focus time norms), Product (leaner feature sets), Physical Evidence (distraction-free spaces)
Primal Workflow
Process (work blocks mirror natural energy spikes: dawn focus, dusk wrap-up)
People (circadian autonomy), Physical Evidence (light & sound cues)
Endineering → mainly a Process lever
Process. Endineering asks a firm to engineer the goodbye: warranties that trigger take-back, portals that let users download and delete their data, packaging designed to be mailed back and mulched, etc. Because it redesigns the steps, hand-offs and policies that close the customer journey, it sits first inside the Process P of the 7-Ps mix. How the ripples spread P What shifts when you “end-engineer”? Product Built-in disassembly points, modular parts, digital “kill-switches” that ensure safe retirement. Place Reverse-logistics channels (locker drop-offs, mail-back programs, local repair hubs). Physical Evidence Materials and packaging specify compostability or recycling codes; end-of-life QR codes on labels. Price Deposit or buy-back schemes that refund part of the purchase when users return the item. People Customer-care teams re-skilled as “off-boarding concierges” who guide surrender or renewal choices. Promotion Stories shift from endless consumption to “complete-the-loop” invitations and transparency reports.
Biomimicry / Nature-as-Stakeholder
Product
Process, Physical Evidence
Designs offerings & packaging that copy nature’s efficient forms.
Frugality Crafting
Product – beautiful objects from minimal materials
Physical Evidence (up-cycled textures), Promotion (frugal-luxury story)
Less is More
Product – cut SKU count, strip non-essential features
Process (leaner lines), Promotion (“edited collection” story), Price (value in restraint)
Right-Sized Solutions
Product – design exactly-fit offers (no extra capacity)
Process (modular build-to-order), Promotion (“fits like it should”)
Artisan Economy
Product – hand-made cues, provenance
People (master–apprentice paths), Price (craft premium), Physical Evidence (tactile finishes)
Craftsmanship
Product (quality of make)
People (master-apprentice paths), Price (premium), Physical Evidence (hand-worked cues)
Soul-Making Productivity
Product / People
Process (reflection sprints), Promotion (maker stories), Physical Evidence (ritual objects)
Builds meaning into the work artefacts—craft cues, narrative dashboards that let staff see the “why”
Taste & Beauty
Product / Physical Evidence
Promotion (visual storytelling); Price (premium)
Sensory & aesthetic excellence built into the core offering and its packaging / retail theatre.
Provenance
Product / Physical Evidence
Place (local sourcing), Promotion (origin story), Price (heritage premium)
Humane Design
Product / Physical Evidence (interfaces, packaging, spaces that respect attention & dignity)
Promotion (ethics messaging), People (UX ethics guild), Process (friction audits)
Mutual Aid / Commoning
Promotion
People, Price
Community co-marketing replaces ads; value flows peer-to-peer.
Eudaimonic Growth & Feelgood Metrics
Promotion
People, Performance
Communicates progress in terms of “flourishing per employee/customer.”
Non-Coercive Marketing
Promotion
People (sales training), Process (opt-in touch-points)
Re-designs persuasive style—no pressure, full consent, ethical data use.
Resonance > Reach
Promotion
Place (micro-channels), Process (always-on listening loop)
Swaps “big audience” for “right audience”, leaning on fragmentation & IMC thinking.
Post-Branding
Promotion
People (employee-as-brand), Physical Evidence (brand-light retail spaces)
Questions the logo-centric brand era; foregrounds identity, purpose & community narratives.
Joyful Jargon
Promotion
People (storytelling training), Product (renamed features), Physical Evidence (signage, UI copy)
Swaps fear-based or corporate-speak for playful, resonant language that builds belonging
Mutual Blooming
Promotion
Shifts narrative from “brand growth” to “co-growth”: campaigns invite customers & communities to flourish together
People (peer evangelists), Product (co-created editions), Price (community profit-shares)
Authenticity
Promotion
People (culture of candour), Product (transparent specs), Price (no bait-&-switch)
Vibrational Marketing
Promotion
Communicates through emotional “frequency” and energetic resonance rather than features. (, )
People (tone-of-voice coaching), Process (intuition checkpoints), Performance (“vibe” NPS)
Campaign Tastefulness
Promotion
Creative is screened for sensory sophistication and cultural fit—“is it tasteful?”
Product (aesthetic cues), People (taste councils), Price (premium for restraint)
Journey Love
Promotion
Celebrates each touch-point, not just conversion; CX storytelling is the lever.
Process (journey-map sprints), People (CX guardians), Physical Evidence (on-pack milestones)
Sufficiency Signals
Promotion – labels, badges and pack call-outs that shout “just enough”
Product (downsized packs), Price (transparent cost-plus)
Emergent Community Design → chiefly a Promotion lever
Promotion. The practice is all about how you invite, spark and maintain dialogue among customers (and would-be customers) so that value arises between them rather than being broadcast at them. That puts it squarely in the communications / relationship-building job of the Promotion P. The definition itself— “we don’t build communities; we build containers where community can emerge” —makes the focus clear: create touch-points, rituals and spaces that let the story travel peer-to-peer rather than brand-to-audience.
How the ripples spread through the other Ps
P What tends to shift once you design for emergent community
People Roles morph from “community manager” to “gardeners” or “hosts”; customers become co-creators and moderators.
Process Always-on feedback loops (weekly AMAs, member spotlights, shared road-maps) are baked into operating rhythms.
Product Features evolve via member proposals and live beta cohorts; “community-built” badges appear on packaging / UI.
Place Brand touch-points extend to owned forums, Discords, local pop-ups and co-working jams where members meet.
Price Tiered memberships, reputation-based perks, or profit-sharing models reward those who contribute most.
Physical Evidence Community dashboards in-app, contributor names on labels, event memorabilia that carries the story offline.
There are no rows in this table
What the pattern says
Patterns to notice
What the pattern says
Use the table as a diagnostic: ask “Which single P must we move first to live this idea—and which domino falls next?” Then craft KPIs that prove you really slowed, softened or soul-fied the business.
A few practical notes
Use this grid as a quick diagnostic: when a colleague drops one of these buzz-phrases, ask “Which P will we move first, and what knock-ons do we accept elsewhere?”—then design accordingly.
None of the narratives tries to be a catch-all “replacement P”; they are levers you can pull inside the familiar mix. Think of them as design principles that can be baked into any (or every) P rather than a parallel checklist.
Why they feel “bigger” than the Ps
Using the ideas in practice
5 Service-ecosystem & platform logics
Service-Dominant Logic (Vargo & Lusch): abandons “mix” metaphor; value is co-created in use, so levers become service ecosystems, operant resources, institutional arrangements ().
6 When to swap frameworks
Table 68
Situation
Why 4 Ps falter
Better choice
Situation
Why 4 Ps falter
Better choice
Multi-sided platforms
Distribution & pricing driven by algorithmic rules, not channels
Platform governance + SDL
Subscription SaaS
Price salience low; retention loops dominate
RACE + SAVE
Bottom-of-pyramid markets
Traditional “Price” ignores ability-to-pay gaps
4 As
Circular-economy brands
Need life-cycle metrics & externalities
3/5 Ps sustainability set
There are no rows in this table
7 Practical note on adoption
Further reading
(All works individually cited inline above.)
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