First, a little history: The 4 Ps describing the strategic position of a product in the marketplace were first used in 1948 when James Culliton said that a marketing decision should be a result of something similar to a recipe. Then in 1953, Neil Borden, in his American Marketing Association’s presidential address, coined the term “marketing mix.” E. Jerome McCarthy, a prominent marketer, was the first to propose the 4 P classification in 1960. Since then, McCarthy’s definition has become widely accepted as the classic 4 Ps of marketing.
What are the classic 4 Ps?
Product — an object or a service that is mass-produced or manufactured on a large scale with a specific volume of units.
Price — the amount a customer pays for the product.
Place — the location where a product can be purchased. It is often referred to as the distribution channel.
Promotion — all of the communications that a marketer may use in the marketplace.
Criticism of the classic 4 Ps
Over the years, the classic 4 Ps have received a fair amount of criticism. Peter Doyle, in his book Value Based Marketing, claims that the “marketing mix” approach leads to unprofitable decisions because it is not grounded in financial objectives such as increasing shareholder value. He argues that a net present value approach maximizing shareholder value provides a “rational framework” for managing the marketing mix.
Some people claim that the 4 Ps are focused only on consumer markets and are not applicable to industrial product marketing. Others claim it has too strong of a product market perspective and is not appropriate for the marketing of services.