An integrated marketing mix: four choices, one position
Definition
Integrated marketing mix: product, price, promotion and place chosen together so that all four support the same position in the market.
Competitive advantage: something a business offers that customers value and rivals do not match, giving customers a reason to buy from it rather than from anyone else.
- Integration means the four elements are decided as one package aimed at one group of customers, so each element makes the other three more believable.
- The test is whether a customer who met only one element could guess the other three, because £2.50 hot food, a plain shop on a busy high street and a promotion about value all point at the same shopper.
- When one element pulls against the rest the customer believes the weakest signal, so a high price in a scruffy shop reads as overcharging rather than as quality, and the money spent building that price position is wasted.
Common Mistake
- The most common mistake in a recommendation is a mix whose elements argue with each other, such as a premium product put on discount every week.
- Constant discounting teaches customers to wait for the offer, so the premium price stops working and the image the business paid to build is spent.
- Check any mix you recommend by asking whether all four elements would make sense at once to a single customer standing in front of them.
Two positions, two mixes: budget and premium
The same four elements can carry opposite positions, provided every one of them points the same way.
| Element | Budget position | Premium position |
|---|---|---|
| Product | Simple, narrow range | Distinctive, high quality |
| Price | Low, close to rivals | High, held firm |
| Promotion | Value, offers and price | Image, design and quality |
| Place | High-volume shops and online | Selective places that match |
- Aldi and Lidl sit in the budget column, where a narrower product range cuts buying and stock-handling costs, which is what makes the low price profitable rather than a loss.
- Dyson sits in the premium column, where over 5,000 prototypes went into the bagless vacuum, the promotion sells that engineering, and the high price both repays the development and signals that the machine is worth more than a cheap rival.
- The row that breaks the pattern does the damage, because a premium price on a business built for volume leaves the product too dear for budget shoppers and too plain for premium ones, so it loses both.
From a mix that fits to an advantage that holds
- Competitive advantage begins with fit, because a mix that matches its target customers more closely than the rival's mix gives those customers a reason to choose this business.
- That reason is what wins the sale without undercutting on price, so the margin on each sale survives instead of being competed away.
- A surviving margin leaves money to reinvest in the product and the promotion, which improves the fit again and widens the gap the rival has to close.
- A single element is cheap to copy, since a rival can match your price by Friday and run its own version of your promotion inside a week.
- Copying a whole position is different work, because the rival has to redesign the product, change the places it sells through and rebuild a reputation customers already attach to you, which takes years rather than days.
- No position is permanent, so when customers' tastes, rivals' offers or the technology move, a mix that fitted becomes a mix that fits nothing, which makes integration a decision you revisit rather than one you make once.
Example
- Blockbuster's mix once held together: DVDs to rent, a price per rental, promotion inside the shop and shops customers could walk into on the way home.
- Streaming changed where people wanted to get films, so every element of that mix was suddenly aimed at a place customers had stopped going.
- The UK business entered administration in 2013, and Netflix took the customers with a mix built around the new technology.
- Integration protected Blockbuster while the market stood still and trapped it once the market moved.
Judging what matters more: the whole mix or one strong element
- A single strong element can win customers quickly and may suit a start-up with limited cash, but it is usually easier for rivals to copy than a consistent position across all four elements.
- An integrated mix becomes more valuable when products differ, the business can afford to support all four elements and it wants an advantage that lasts rather than a short-term sales boost.
- Overall, established firms usually gain more from a coherent integrated mix, while a cash-limited start-up may sensibly lead with one distinctive element and build the rest of the position over time.
Exam technique
- State the market position first, then show how the four elements support it rather than listing four separate decisions.
- Use the customers, rivals and budget in the source booklet and trace the mix through sales, margin and competitive advantage.
- For a judgement, consider whether the firm can afford to change all four elements and whether a whole position is harder to copy than the strongest single element.
Self review
- What does it mean to call a marketing mix integrated?
- Give one product decision and one place decision that fit a budget position.
- Explain how holding the margin on each sale widens a competitive advantage.
- Why can a rival copy a price far faster than it can copy a whole position?
- Name one change that can make a well-integrated mix stop fitting its market.
