7Ps in marketing – the most effective strategy for the service industry
If you are familiar with the 4Ps, the 7Ps in marketing must be a concept introduced previously. Nevertheless, this is a potent tool in marketing, especially for service businesses.
So what are the 7Ps in marketing, and how to apply them effectively? Let’s take a look at the most outstanding ideas with CleverAds.
1. What are the 7Ps in marketing?
7P is a model developed based on the original 4P model. Therefore, it has had many changes and improvements to be more suitable for businesses.
The 7P model consists of 7 elements:
- Product
- Price
- Place
- Promotion
- People
- Physical evidence (tangible factors)
- Process
Considered a model that every service business must pay attention to, what exactly is each element in the 7Ps, and how powerful is it? Let’s find out below.
Read more: What is Marketing 4P? Marketing Manual for Beginners
2. Product
In the service industry, products are mainly intangible—for example, tourism and education services. Customers can only feel and experience but cannot grasp.
Satisfaction with service experience is a measure to evaluate the service quality of customers.
To succeed with this first P, you need the following strategies:
- Identify customer files and target markets that are suitable for your services.
- Make your USP (unique selling point) stand out from the competition.
- Regularly listen and respond to customers.
3. Price
In the 7P, price is the only factor that brings revenue to the business.
Therefore, you need to consider the appropriate price setting. There are pricing strategies you can consider:
- Market penetration pricing: Set low prices first to dominate the market, usually for products that are not significantly different from competitors.
- Competitor pricing: Assess your competitors’ level of competition to set the right price
- Set skimming prices: Set high fees to get the most profit, then gradually lower the price to attract more customers.
- Cost-based pricing: After calculating the product cost, add the desired profit to get the final price
- Price-to-value: Set the price the customer is willing to pay for the experience.
4. Place (distribution channel)
Distribution channels in the service sector are extremely important. For example, for an English learning center for children, their customers are usually parents within a 3km radius. Therefore, placing the center in a crowded and convenient place is extremely important.
In addition, it is necessary to pay attention to factors such as transmission lines, interfaces, and online experiences for online service distribution channels.”
Read more: What is Marketing Mix?
5. Promotion
In today’s competitive era, promotion is a tool that businesses invest extremely strongly in. Typical promotion strategies can be promotions, PR, advertising…
Enterprises need to be alert in using the appropriate method so that the costs of these activities do not “”bite”” all the revenue.
It would be best if you considered some of the following factors:
- When is the right time to launch promotional activities?
- Your brand value? Does the promotion strategy reduce the brand’s positioning in the eyes of customers?
- Budget for promotion strategy
- Understand customer needs and wants
- Monitor and measure promotion effectiveness
6. The important factor of the 7ps in marketing: People
In services, people play a key role in affecting service quality. The reason for the inconsistent service quality may come from the human factor.
Therefore, to ensure uniformity in the service process and bring the best satisfaction to customers, it is necessary to ensure the quality of receipt. Some suggested ways to improve the quality of human resources:
- Build a systematic process to train employees
- Having a quality monitoring, monitoring, and evaluation system
- Inspire products and brands with employees
7. Physical evidence
The smell of coffee roasting is attractive, the tables and chairs are neatly arranged, and the open space has lots of natural light. The elements of physical evidence seem simple but are extremely important in the customer experience.”
To increase customer satisfaction, you need to observe and refine factors such as facilities, decoration, color arrangement, scent, and behind-the-scenes elements.
8. Process
A simple process, less cumbersome, and clear procedures are very important for a service business.
Because if customers need to use the service urgently, the waiting time and lengthy procedures will negatively affect the overall experience.
Some ways you can optimize your process are:
- Cut unnecessary stitches
- A sufficient staff member to carry out the service process
- Make sure ingredients are always ready to serve
- Encourage customers to participate in some stages of the process actively.
9. Starbucks – The giant coffee giant, thanks to the successful application of the 7Ps in marketing
As the most valuable beverage brand in the world, Starbucks is proof of its resounding success thanks to the skillful combination of 7P elements in marketing.
Initially, this was just a small shop. But with the philosophy of not selling coffee, but selling experiences only at Starbucks, along with tireless marketing efforts, Starbucks now has more than 18,000 stores in 49 countries.
- Product: Fast in innovation, grasping market trends, Starbucks launches many new seasonal product lines. They also have many different criteria for coffee, such as based on the type of bean (roasted, whole bean), taste, caffeine concentration, and roast level.
In addition, the accompanying products of Starbucks are also a “money-making” business. Therefore, these are more sought-after products than Starbucks coffee.
- Price: Starbucks chooses a premium pricing strategy based on customer experience.
- Place (distribution channel): Starbucks’ products are provided mainly in coffee shops. Some are distributed on online channels. Customers can get products immediately through the Starbucks app.
- Promotion: Starbucks pours a lot of money into advertising, promotions, and loyalty programs to increase sales. Typical Starbucks Rewards, which receive stars when spending and exchange stars for free drinks and food.
- People: Starbucks is very interested in employee training and development. This is considered an equal and diverse workplace with hundreds of thousands of employees.
- Physical evidence (tangible elements): Every design in the cafe tries to create the most comfort for customers, from the fragrant aroma of coffee roasting to the decoration space that is personalized to each locality.
- Process: A professional, friendly, and efficient service process is what Starbucks brings to customers. Employees must always begin with a greeting when guests enter and say goodbye when guests leave.
Conclusion about 7Ps in marketing
The above are basic definitions and suggestions to help businesses better apply the 7Ps in the marketing mix. This sharing will help you use many new ideas in business.
