Anyone who took a marketing class in college can recite the four P’s – product, promotion, pricing, and place. Well it looks like they might be losing their relevance in the wake of the four C’s – connections, choice, conversation, and convenience. According the an article on Retail Customer Experience, the four P’s worked well in the brick-and-mortar world, but the advent of technology and ubiquitous connectivity has led to a systemic shift in the retail landscape.
From the article:
There are two major disruptive forces shaping the face of retail today. The first is the technology of being able to connect anytime anywhere. Technology has enabled the second and more significant force: consumers changing both their shopping behavior and what they value. In a consumer-centric world the 4 Ps of marketing are less relevant and far less effective:
Product: Consumers can purchase products anywhere, including direct from the manufacturer. Product information is an open book … you can read reviews online at Amazon, and the most trusted source of product information is family and friends.
Pricing: Before EDLP (Everyday Low Price) retailers used to manipulate pricing to drive traffic and sales. The majority of consumers are researching online, and willing to purchase online. Lowest price is no longer a competitive tool, even for Walmart. Competitive pricing is a prerequisite to be considered, but not sufficient to close a sale.
Promotions: US retailers, like JC Penney’s, established their brand through weekly promotions. In-store promotions have lost their impact … and they may not even be considered at all if the shopper doesn’t interact with the retailer online. If promotions have a significant impact at all, they are most effectively deployed in an omni-channel strategy.
Place: This is where bricks and mortar stores can be most vulnerable. They are locked into leases and invested in place. Consumers are increasingly “place agnostic.” They want choice of where and how they purchase. And, the “long-tail” of online assortments offers far more variety than what can be assorted in store.
Rise of the 4 Cs of consumer-centric marketing
The 4 Ps of marketing and retailing were relevant when product was king. Today, the consumer is queen and makes the rules of how, when, and where she shops. Are bricks and mortar retailers doomed? Yes, if they fall back only on their heritage of the 4 Ps. The successful retailers in this consumer-centric world are quickly finding that this has become an environment where omni-channel is the new normal. Big-box retailers will be especially challenged. They can’t dominate on their locations or size of their store assortment. In fact, large store assortments can be a disadvantage in terms of carrying costs. In this consumer-centric world, virtual shelf will be as important as physical shelf.