The Forgotten “P”

May 16, 2009 at 6:11 pm 2 comments

As we learn early on, marketing is the Four “Ps:” product, price, place, and promotion. “Place” is the means by which consumers receive the product, the retail environment and the distribution channels that support it. I consider “Place” the forgotten “P,” the one that receives the least attention from many marketers, the one that is under the most pressure for change and improvement from consumers.

Two news items this week make me remember the Forgotten “P.” I discussed one in a previous post: Sony’s launch of its iPod fighter, the Walkman X. The other story: GM and Chrysler’s announcements of massive cuts to their dealer networks. While acknowledging Sony’s obligatory optimism for its new product, we see the electronics/media giant and the shriveling automakers living out similar woes. They all neglected the “Place” component of the marketing mix.

Hobbled by Sony Music Entertainment’s devotion to old-school music business models, Sony the parent did not accommodate consumers’ demands to purchase music in new ways–digitally and a la carte per song. Thanks to technology, the means of acquiring and enjoying music had changed and hardware needed to follow suit. (A case of the tail–“place”–wagging the dog–“product.”)

GM and Chrysler’s “place” failures were manifested in bloated dealer networks with the uncanny ability to subtract value from the product through unsatisfactory sales and service experiences. Much has been written about American-nameplate dealerships having far lower unit sales (yearly average) than their Japanese-nameplate competitors. Inefficiency and substandard practices in the Forgotten “P” comprise one more nail in the coffin for Detroit. For years, automakers have resisted streamlining dealership networks, citing the billion-dollar-plus price tag of closing down Oldsmobile. Now the Olds tally is chump change compared to the cost of GM and Mopar’s corporate dismemberment and vaporized market share.

Many consumers think of “place” as a necessary evil, a middleman, a conduit. If they can eliminate any inconveniences and disappointments inherent in this “P,” they will. If they can select a comparable product tied to a superior place strategy, they will. Everyone’s favorite case study subject, Apple, is the master of this reality with the super cool and helpful Apple Stores and iTunes, the online media store/library/player that is perhaps more of a game changer than the mighty iPod itself.

Bottom line: a product is not a mass widget; it is an individualized experience. Sony, GM and Chrysler wanted to have the experience their way. They forgot how to manage the “P” known as place. Now all three are found wanting.

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Entry filed under: Leadership, Marketing. Tags: , , , , , , , .

iPaused Night at the Pontiac Museum

2 Comments Add your own

  • 1. Jonathan Vos Post  |  May 23, 2009 at 3:49 pm

    “the Four “Ps:” product, price, place, and promotion” — this is parallel to the Four Fs that I taught my Biology and my Anatomy & Physiology Students were determined by the Reticular Formation of your brain: “Feeding, Fleeing, Fighting, and Reproduction.”

    Reply
    • 2. jasonkarpf  |  May 23, 2009 at 4:03 pm

      Same is true in science and marketing…sex sells.

      Reply

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