Friday, February 15, 2013

Marketing mix part 2

Four Cs: in the seven Cs compass model

After Koichi Shimizu proposed a four Cs classification in 1973, this was expanded to the seven Cs compass model to provide a more complete picture of the nature of marketing in 1981. It attempts to explain the success or failure of a firm within a market and is somewhat analogous to Michael Porter's diamond model which tries to explain the success and failure of different countries economically.

The seven Cs compass model are:

•    (C1)Corporation– The core of four Cs is corporation (company and non profit organization). C-O-S (Organization, Competitor, Stakeholder) within the Corporation. The company has to think of compliance and accountability as important. The competition in the areas in which the company competes with other firms in its industry.

The four elements in the seven Cs compass model are:
•    A formal approach to this customer-focused marketing mix is known as Four Cs (Commodity, Cost, Channel, Communication) in “the seven Cs compass model". The four Cs Model provides a demand/customer centric version alternative to the well-known four Ps supply side model (product, price, place, promotion) of marketing management.
o    Product = Commodity   Price = Cost   Place = Channel   Promotion = Communication

•    (C2)Commodity – (Original meaning of Latin: Commodus=convenient) : the goods and services for the consumers or citizens. Steve Jobs has been making the goods with which people are pleased. It is not "product out".

•    (C3)Cost – (Original meaning of Latin: Constare= It makes sacrifices) : There is not only producing cost snd selling cost but purchasing cost and social cost.

•    (C4)Channel – (Original meaning is a Canal) : marketing channels. Flow of goods.

•    (C5)Communication – (Original meaning of Latin:Communio=sharing of meaning) : marketing communication : Not only promotion but communication is important.

The compass of consumers and Circumstances (environment) are:
•    (C6)Consumer – (Needle of compass to Consumer)
The factors related to consumers can be explained by the first character of four directions marked on the compass model. These can be remembered by the cardinal directions, hence the name compass model:
o    N = Needs
o    W = Wants
o    S = Security
o    E = Education (consumer education)

•    (C7)Circumstances – (Needle of compass to Circumstances )
In addition to the consumer, there are various uncontrollable external environmental factors encircling the companies. Here it can also be explained by the first character of the four directions marked on the compass model:
o    N = National and International
o    W = Weather
o    S = Social and Cultural
o    E = Economic
These can also be remembered by the cardinal directions marked on a compass. The seven Cs compass model is a framework in co-marketing (symbiotic marketing). It has been criticized for being little more than the four Ps with different points of emphasis. In particular, the seven Cs inclusion of consumers in the marketing mix is criticized, since they are a target of marketing, while the other elements of the marketing mix are tactics. The seven Cs also include numerous strategies for product development, distribution, and pricing, while assuming that consumers want two-way communications with companies.

Thursday, February 14, 2013

Marketing mix

Marketing mix is a tool used in marketing. It is one of the crucial instruments when trying to determine a product or brand. The most associated acronym used is four Ps, although it has been sometimes expanded into seven Ps or even eight Ps in order to better address different products.
In recent times a concept of four Cs has also been introduced with the intention of replacing the four Ps. Today there are two four Cs theories out there – Lauterborn and Shimizu.

Classic definition of four Ps is: Price, Product, Promotion and Placement.
The four Cs definition is a bit trickier since there are two theories out there.

Four Cs: the consumer-oriented model
Robert F. Lauterborn introduced a four Cs classification in 1993 which is a more consumer-oriented version of the four Ps that attempts to better fit the movement from mass marketing to niche marketing:
•    Product part of the four Ps model is replaced by "Consumer“, shifting the focus to satisfying the consumer needs. By defining offerings as individual capabilities that are combined and focused to a specific industry, the result is a custom solution rather than the pigeon-holing of a customer into a product.
•    Price is replaced by "Cost", reflecting the total cost of ownership. Many factors affect Cost, including but not limited to the customer's cost to change or implement the new product or service and the customer's cost for not selecting a competitor's product or service.
•    Promotion is replaced by "Communication", which represents a broader focus. Communications can include advertising, public relations, personal selling, viral advertising, and any form of communication between the organization and the consumer.
•    Placement is replaced by "Convenience". With the rise of Internet and hybrid models of purchasing, Placement is becoming less relevant. Convenience takes into account the ease of buying the product, finding the product, finding information about the product, and several other factors.

Second four Cs theory will be explained in the next article.

Monday, February 11, 2013

The Business Plan

I have written in quite a bit of detail how to write a business plan. But I know that there are some of you who are more of audio types :)
So I tried to make it easier for you!
I found this nice video of a presentation held at Stanford University by Jim Ellis.
Enjoy the viewing! And remember - we are doing this for you!