BENEFITS OF MARKETING

• Content Marketing
• Inbound Marketing
• Social Media Marketing
• Search Engine Optimization
• Search Engine Marketing/PPC
• Account Based Marketing (ABM) and Retargeting
• Earned Media and PR
• Referral Programs
• Industry Events
• Conversational Marketing

• Social Networks and Viral Marketing
• Paid Media Advertising
• Internet Marketing
• Email Marketing
• Direct Selling
• Point-of-Purchase (POP) Marketing
• Co-Branding, Affinity, and Cause Marketing
• Conversational Marketing
• Earned Media/PR
• Storytelling

Businesses use the marketing mix to determine how to promote and position their products to appeal to their target audiences. However, marketing services – rather than products – requires a different approach. Unlike products, which are tangible, services are not something customers can hold in their hands. As a result, it's more difficult to convey the benefits and worth of a service and persuade customers to make a purchase.

The original marketing mix consisted of product, price, place and promotions. Over the years, marketers added additional elements to the marketing mix, including people, process, physical evidence and philosophy. When you market services, it's critical to understand how the marketing mix needs to shift to accommodate the intangibility of the offering.

The marketing mix elements not only need to make the service appealing for customers, but they also have to address other issues. The intangibility of a service makes it difficult for customers to know what they will be getting. 

For example, a haircut is a service. However, customers do not have a clear idea of the result until the service is complete. Similarly, services are variable and affected by different elements, such as the people who provide them. A customer's haircut differs based on the stylist.

According to Kotler & Keller, Marketing Management | Pearson, marketing mix needs 8Ps to represent the modern panorama.

This model is based on the concept of holistic marketing: an interdisciplinary and interconnected subject founded on four pillars:

• Relationship marketing;
• Integrated marketing;
• Internal marketing;
• Performance marketing.

The 8Ps of Marketing Mix starts from the 4Ps model and adds people, physical evidence, process, and philosophy.

1. Defining the Product or Service (Consumer's Needs and Wants)

The first P is the product the company offers. In the case of a service, businesses need to take special care to identify, define and design the service. By nature, services are perishable; you cannot store a service and use it later. It is delivered at the same time you buy it, like a car wash, for example. Not only that, but the service can also vary based on elements such as how busy the business is or how experienced the service representative is. The benefit of this heterogeneous element is that businesses can offer customizable services based on the customers' needs.

In contrast, businesses also need to create standardization and stability within the service to offer specific results. In this marketing mix example, the car wash must always leave the customer with a clean car, but the business can customize the products or processes it uses to get the car clean.

2. Setting the Price (Cost to the Consumer)

The price of the service is what the customer pays the business in return for the offering. When setting the price of a service, businesses consider a number of elements, such as:

• The labor involved
• The cost of goods used within the service
• Overhead costs including ambiance
• The demand for the service versus the supply
• Competitor pricing

The most important element to consider when setting a price for a service is the value the customer receives from the result.

For example, the actual cost to a salon for a haircut may only be $20, but the value to the customer may be five times that. Unlike for products where cost-based pricing often takes a front seat, a value-based pricing strategy is key for services.

3. Creating the Place (Convenience)

The place is where customers access the product. This not only encompasses where the business is located but also what the business looks like. The entire experience of buying and receiving the service should be considered.

For example, a massage therapist's office that is noisy and crowded does not provide a relaxing experience.

When providing access to the service, consider what is most convenient for the buyer and what will give them the result they seek. The business should be physically easy to locate. Once there, the customer should begin the service experience. For example, a massage therapist's office can be located in a busy downtown office, close to parking and public transportation. This makes it easily accessible to the target market. The interior of the office should have mood lighting and calming music to help customers feel the relaxation effects even before the service starts.

4. Planning the Promotions (Communication)

Promotion entails how a business communicates its service offering to customers and differentiates it from competitive services. Digital marketing consultant Alberto Carniel points out that the type of promotions a business uses depends on its marketing strategy. Promotional channels include advertising, sales promotion, personal selling, direct marketing and public relations.

Businesses need to determine the best way to reach their target audiences to promote the service. Any promotions should include the benefits the customer will receive from the service and details about what makes this service unique. In a marketing mix example for a tailor, the promotion can include details on how well the clothes will fit. To differentiate this service from all the other tailors, the business can use promotions that include details about the company's unique measurement system or its high-end sewing machine.

5. Identifying the People

In the service industry, the people providing the service are inseparable from the service itself. This is one of the 8 P's of marketing that truly differentiates products from services. As a result, businesses need to position the service provider as an expert.

The marketing strategy should include information on the service provider's experience and positive reviews. The business also needs to invest in customer service training so that the service provider can relate well to clients, build relationships and rapport, de-escalate tense situations and meet emotional needs.

6. Producing Physical Evidence

Because services are intangible, businesses need to offer physical evidence of the value customers receive. One way to provide physical evidence is in the ambiance of the place where the service is provided. In a high-end restaurant, for example, the servers may wear formal attire to showcase the luxury and exclusivity of the service.

Another way service-based companies offer physical evidence is through providing small products along with the service.

For example, a nail salon may offer a complimentary nail polish with every appointment. By providing physical evidence of value, businesses transform an intangible service into a tangible offering.

7. Differentiating the Process

The process is how the business delivers the service to the customer. This includes everything from how the customers are greeted when they enter the business to how they are billed after the service is completed. A formal process enables businesses to offer a standardized level of service for each customer. It also enables businesses to make small customizations within the process to ensure a desired result.

Service-based businesses should create an easy-to-understand customer-facing process and share it in their marketing materials. This way, customers know exactly what to expect when they engage the business.

8. Showcasing the Philosophy

One of the 8 P's of marketing, according to the American Camp Association, is philosophy. This is integral to marketing services because it encompasses the "why" element. Since services are directly tied to their service providers, it's essential for customers to understand the mission, vision and values of a business. Why does the business offer this service, and what makes this business unique?

Service-based businesses that promote their philosophies differentiate themselves from their competitors.

For example, a mechanic's philosophy may be to help customers reduce the stress associated with their vehicles. A doctor's philosophy may be to ensure each patient feels heard. Learning the philosophy of a business may be the deciding factor for a customer.

What Is Artificial Intelligence (AI)?

For those who are not familiar with the concept, AI in marketing is when machines use customer data to learn from and predict a customer’s next action, and in turn, improve the overall customer experience. This definition is relatively broad as AI is a term that describes related, yet unique, technologies. Some of these technologies include machine learning, image recognition software, and natural language generation.

Basically, AI marketing uses artificial intelligence technologies to make automated decisions based on data collection, data analysis, and additional observations of audience or economic trends that may impact marketing efforts. AI is often used in marketing efforts where speed is essential. AI tools use data and customer profiles to learn how to best communicate with customers, then serve them tailored messages at the right time without intervention form marketing team members, ensuring maximum efficiency. AI is used to augment marketing teams or to perform more tactical tasks that require less human nuance. 

Over time, AI has evolved and is still continuously improving, changing the way business operates, especially with regard to their consumers. But, how is AI changing the marketing landscape of today?

Based on research conducted by Oracle, CX Research - Can Virtual Experiences Replace Reality?, 8 out of 10 businesses have either already implemented AI (37%) or are planning to adopt it by 2020 (41%). They understand that they must enable AI-powered experiences to better serve customers and to keep up with competitors. 

In today’s digital market composed of technology-savvy consumers, AI has come to play an important role and has contributed and improved several aspects of marketing, such as forecasting future sales, segmenting and targeting consumers, as well as creating more accurate and effective campaigns. AI allows marketers to fully understand the behavior/preferences of consumers on their digital platforms, allowing to present them with the content that they are looking for and want. 

Moreover, AI-marketing has enabled to take some of the heavy load of marketers by making machines handle consumer data and allowing marketers to focus on creating engaging content and addressing any problems or challenges that may come their way. Now, let’s take a closer look at how AI is beneficial to marketing.

There are 6 evolutionary stages of AI that are significantly shaping new customer experience expectations:

1. Curation
2. Customized Information
3. Recommendations
4. Predictions
5. Automation
6. Contextual Analysis

Consumer Segmentation

First of all, great marketing involves understanding your consumers, and the first step in doing so is knowing who they are. Consumers quickly scroll through information online, making it difficult to track what they are actually looking at. AI allows marketers to track consumer moves easily and see what information each consumer is attracted too and what they are looking for. This way, marketers can separate their customers into different segments and understand what each segment wants. This way marketers can specifically focus on what motivates each segment.

Targeting

Once you know your consumer segments, AI allows marketers to target the needs of these specific segments by providing consumers with the right message, at the right time. Whether consumers are on their phone, laptop, or any other platform or device, they tend to think of marketing as annoying. Better understanding the habits and needs of these consumers makes it easier to provide them with content that is more engaging, enjoyable, and relevant to them.

AI enables the creation of marketing content that meets the needs of these consumers and is highly personalized, in turn, creating long-lasting relationships between them and the brand. This increases loyalty and value, which is especially important in today’s highly-competitive B2C market.

Accurate and up-to-date Content

Every marketer knows that consumer needs and expectations are continuously changing, and it is difficult to stay up-to-date with current demands and trends. Algorithms and predictive analytics allow for accurate predictions by analyzing past and present customer behaviors and patterns in order to create accurate content and even predict future trends. Marketers can use this data to quickly create real-time content and modify messages or campaigns for maximum effectiveness.

Nonetheless, AI is reshaping marketing as we know it and affecting various aspects of a business. It is continuously developing and expanding, becoming an important aspect of business success. However, you may wonder, are there any downsides of AI to marketing? Are certain AI technologies more effective than others? And will AI replace the job of marketers in the future?

Challenges for AI Marketing

The development and use of AI tools are still in early stages. Therefore, there are a few challenges to be aware of when implementing AI in marketing. 

To be competitive, you need a great marketing strategy. Through strategic planning and analytical thinking, Visionary People can help you  design a strategic marketing plan that guides you on how to effectively engage with customers. This helps your business sustain and grow. 

To make sure you are making the most out of your marketing budget, contact us today so that we can  discuss your current and future marketing goals and what you would like to achieve.

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