The 7 Ps of Marketing is a classic marketing model that helps us understand the “set of marketing tools that a firm uses to pursue its marketing objectives in the target.” You may also hear this referred to as the “marketing mix.” This is no mere academic exercise, though. Each one of the 7 Ps of Marketing represents a lever of power which you can use in your small business.

7 Ps of Marketing

It’s one thing to understand marketing, but it’s another thing entirely to apply it well. Once you set your small business marketing strategy, you need a way to measure your performance. Luckily, the 7 Ps of Marketing gives us a great way to do that.

Before we get started, I’ll point out that we’re using the 7 Ps of Marketing as defined in this Entrepreneur Magazine article. The original Booms and Bitner model from the year 1981 used “Physical Evidence” and “Process.” Don’t worry, hardcore academic Booms and Bitner fans – I’ll be including those at the end as well!

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The 7 Ps of Marketing

  1. Product
  2. Price
  3. Promotion
  4. Place
  5. Packaging
  6. Positioning
  7. People
  8. The Forgotten Ps: Physical Evidence and Process

The 7 Ps of Marketing

Product

Imagine your company from the outside. Your product or service is likely what draws people in. Sometimes the branding or a well-crafted ad is what makes people take interest in you, but let’s be real – it really does come down the product. Of all the 7 Ps of Marketing, this is the most tempting one to spend your time on. To be fair, that instinct is fundamentally right.

Apple devices cell phones

Value is subjective. Ultimately, how your product will be perceived is entirely dependent on the people using it. You want to make sure you have a clearly defined target market and that your product perfectly fits that market’s desires. When you do this, you have achieved product-market fit.

Product-market fit is truly the foundation here. Your target market determines the needs you will be meeting. The product you create to meet those needs determines what product-market fit looks like. Once you’ve identified a way to achieve product-market fit, you can find your niche. From within that niche, you can craft messages that drive the consumer behavior which you’re seeking – which is most likely sales!

Your product must meet certain needs. It does not necessarily have to be the best in a perfectly rational sense. Objectivity is not often a part of consumer decision-making. You need to make a product which is adept at addressing the emotional needs of your target market.

Price

When setting prices for your products, it’s tempting to focus your attention in one of two places. The naive attempt to compete on price, making the lowest-cost products on the marketplace, whether or not that is the right action to take. Alternatively, the overly introspective may intuitively set the price based upon internal costs, but not outside factors. Both of these can be valid pricing strategies, you just need to make sure your reasoning is solid.

price of pears

Price is the most deceptively complicated of the 7 Ps of Marketing. Again, you’ll need to refer to your target market and their expectations. Pay attention to how they make decisions and how you can nudge them toward desired consumer behavior.

The price tag you see on a product conveys an enormous amount of information in a tiny number. Price can give you a rough idea of quality and it can give people expectations – warranted or not – of what the product experience will be like. There is an element of price snobbery in many industries wherein customers actually prefer higher prices!

Of course, you’ll also want to consider price elasticity. The concept of price elasticity helps us find the tipping point where it is no longer worth it to raise or lower the price. If profit is your goal, you want to set your price in such a way that you maximize profits. That doesn’t necessarily mean charging the highest price or having the most customers. Oftentimes, it’s somewhere in the middle.

When you set a price, you need to choose a pricing strategy that most neatly lines up with your customers’ emotional needs. While people do sometimes make rational purchasing decisions, emotions – at the very least – are what initiate the purchasing process in the first place. For that reason, you want to make sure you don’t leave your customers with sticker shock or, alternatively, look so cheap that they write you off entirely.

Promotion

Of all the 7 Ps of Marketing, Promotion is the one most focused on pulling people to your business. Promotion entails how you spread the word about your products or services. Included within that are the ways you gain attention, pique interest, stoke desire, and get people to take action.

limited time offer

To run an effective promotion, you need to understand consumer behavior and decision-making. People don’t necessarily make decisions based on pure reason. Again, as with price and even the product itself, people make decisions based on the promise of solving emotional needs. When running a promotion, you need to find ways to better signal that you can meet those emotional needs.

For example, running a sale can remove concerns about not getting a good deal. It can also create a sense of scarcity that pushes people to take action. Likewise, advertising with a well-crafted headline can get a higher conversion rate, because it’s better at capturing attention than a typical ad would be.

To truly master the art of Promotion, you always need to be experimenting. Play around with different sales and marketing techniques, as well as different products or marketing strategies. Always be gathering data so you can create a feedback loop. With that feedback, you can make changes to your business that will make it more effective at marketing over time.

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Place

Of the 7 Ps of Marketing, Place may seem the most out of place. You may be running an online business and physical presence may not be a factor. However, whether you’re running a business online or offline, Place still matters. It changes the way that customers perceive your products and your brand.

places

Place entails not just where a product is sold, but where communication takes place that informs customers of a product or convinces them to buy it. Again, this could be offline or online. People often make decisions and form opinions based on the experiences they have. The ambiance of your establishment or the user experience of your website can greatly change perceived quality.

Packaging

Just as Place can alter customers’ opinions of your products and your brand, so too can Packaging. Of the 7 Ps of Marketing, this is one that I believe plays an especially important role in the online world. Because the online world is so noisy and fractured, any image or headline, as well as any smartly bundled set of products or services, is necessary to stand out in the crowd.

packaging

Packaging involves visual packaging design, as well as the physical feeling of your product. It also involves art and graphic design. Both of these things can make a huge difference in how customers perceive value. If you don’t believe me, order some samples of wedding stationery and see how different types of material make you feel.

It’s not all surface sheen, though. Packaging also involves how you bundle products or services. Perhaps it would be better, in this respect, to think of Packaging as Presentation. Bundled products or services can provide a better economic value or perhaps simply a better user experience. Either way, it’s an important part of your marketing strategy and must be considered.

Believe it or not, this was not included in the original 1949 model – the 4 Ps of Marketing. At that time, people subscribed to different marketing philosophies than we do now. In the 1940s, the general approach to marketing was more grounded in economic rationality, which doesn’t hold up very well to our current understanding of behavioral economics. The point is: looks matter more than you think.

Positioning

It’s no secret that in order to remain competitive in our gigantic world, you need to have a niche that you occupy better than anyone else. Another way of saying this is that you need to be careful about your marketing Positioning. This is the sixth of the 7 Ps of Marketing.

balancing stones

No matter how you choose to position your small business, you need to make sure you have a clear-eyed idea of what your customers want. You need to create a product with good product-market fit that addresses real emotional needs. Once you do that, you need to position yourself in such a way where it is clear that you can provide tremendous value.

To determine your positioning, consider the following questions:

  1. What does your company represent?
  2. Which qualities set your company apart from the competition?
  3. If there were a single attribute that you would want people to think of when thinking of your company, what would it be?

Once you answer those questions, you will always want to look for ways to improve the clarity of your positioning. There is also the possibility that market needs will shift and you will have to reposition your company around existing market demands. No matter what you do, make sure your branding is always consistent with your positioning. Your logo, name, product offerings, and marketing materials need to be consistent with your desired market position.

People

The last of the 7 Ps of Marketing is People. It’s certainly not the least! No matter how wonderful your product is, no matter how effective your promotions are, and no matter how smart your positioning is, there is one simple truth you cannot escape. People are the ones actually executing your processes.

team brainstorming session

In the 7 Ps of Marketing, People refers not to your customers but rather your internal personnel. They need the skills and the abilities to execute your plans to a satisfactory degree. You need to be able to retain talent and grow your employees. Failure to do so will make it very difficult to make good on even the best plan.

As I see it, there are four landmines which you will need to avoid for People:

  1. Turnover – if this is too high for any reason, you will constantly be spending money onboarding new people and you will never have the most qualified people handling the work.
  2. Incompetence – if your staff are unable to perform their jobs well, you will be stuck receiving 60-70% of what you need, unable to lay them off because that’s slightly worse.
  3. Bad process design – oftentimes, incompetence is nothing more than the symptom of badly designed business processes. You have to make sure your business is designed in such a way where any reasonably competent individual can succeed.
  4. Bad work environment – we’ve all had terrible jobs before. You know that in bad work environments, you are neither productive nor likely to stick around for long.

Likewise, truly exceptional People can be a huge selling point that can set you apart for years to come.

The Forgotten Ps: Physical Evidence and Process

I purposefully chose Entrepreneur Magazine’s interpretation of the 7 Ps of Marketing instead of the 1981 model. The original 1981 model included Physical Evidence and Process, both of which are important and I’ll cover below.

process diagram

Physical evidence involves the physical environment in which a service occurs or a product is sold. It entails the furniture, spatial layout, signage, interior design, and a lot more. I omitted this because it’s between Place and Packaging in my opinion, making it a little bit redundant. What’s more, it’s not inclusive enough to new ways of doing business made possible by the Internet. For online businesses, physical evidence may include a website with a clean layout and glowing testimonials.

Similarly, the 1981 model also included Process. This entails procedures, mechanisms, and the general flow of activities within a business. That includes the choice between standardizing processes or leaning into customization. It also includes diagnosing failure, monitoring and tracking metrics, analysis of resource requirements and allocation. Process entails best practices and documentation.

While Process is very important to how your business performs, I personally see it as a layer underneath marketing. Lean process design is a necessity for small business success, but I wouldn’t go so far as to call it a marketing tool in its own right.


The 7 Ps of Marketing provides a useful framework for small businesses to analyze their marketing strategies. By neatly listing the 7 Ps here, we have an idea of which questions to ask ourselves to move forward.

With all this in mind, what’s the one P that worries you the most right now? Let me know in the comments below!

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12 Comments

Calvin · November 19, 2019 at 12:05 am

Great to know of these key elements, especially to those who want to grow their business.

Susan Biddle · November 19, 2019 at 9:10 am

The 7 P’s are great marketing tips! It can be really confusing, and this is a great way to remember these important tips. Thanks.

Hadi · November 19, 2019 at 3:58 pm

very interesting

Mya Murphy · November 19, 2019 at 8:31 pm

These seven P’s of marketing is pretty spot on. My husband and I are just now getting started in getting a small business going, and this is what has been told us. This article makes it easier to understand.

    Brandon Rollins · January 15, 2020 at 9:04 pm

    It’s an old theory, but a useful one to reference even still. Glad this article helped you understand it, Mya!

Wilna Wheeler · November 24, 2019 at 12:12 am

The 7 Ps is interesting!

Sally Collingwood · November 26, 2019 at 1:37 am

The 7 P’s of marketing is very complex, but you have certainly nailed it!

Rosi · November 27, 2019 at 10:28 pm

In today’s competitive market you need to follow the rules of marketing to succeed

Shaina D'Souza · November 28, 2019 at 5:12 pm

Great article!

Ghram Myers · November 30, 2019 at 8:28 am

It’s all easy till you get to the people part of marketing. In the words of Spock, humans are not logical.

Maria Teresa Fernandez Ferreira · December 2, 2019 at 9:54 am

Thanks for the article, it has been very helpful

    Brandon Rollins · January 15, 2020 at 9:04 pm

    And thank you for reading, Maria!

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