B-schools and the 4 P's of Marketing

For Josh... who asked.


Why Do B-Schools Still Teach The Famed 4P's Of Marketing, When Three Are Dead? 

The headline brings much promise for the blog post I linked above, but the post shows the writers' lack of marketing and business knowledge. I certainly agree with the concept that the four P's are some what out-dated. Depending on how they are presented, they can be like a disco leisure suite, but I also believe they are still relevant in today's ever changing marketing world.

Promotion-in the mentioned blog post is equated with advertising-which is wrong. The P 'promotion' does incorporate advertising but it is so much more. All forms of communication with the consumer is under promotion- and that includes social media and all things Internet. Do we need to include things in promotion that perhaps we have excluded before? Yes! Do we need to talk about social media as more than a fad? Yes! Do we need to realize that promotion for many brands is now a collaborative process with consumers creating promotional content-even without contests? Yes! Do we need to teach more extensively about branding and having clear branding strategies across platforms? Yes! The promotional world is different from it was even ten years ago, and what B-schools teach has to change to match these shifts.

Place - according to this author is dead because more and more commerce is moving on-line. Let me go tell Kroger to start closing their doors, and I better hurry to see my last 3D iMax movie while drinking my venti mocha, non-fat, no whip add toffee nut frap from Starbucks. Seriously? All kidding aside, yes, online commerce is growing and continues to grow. Does this mean that brick and mortar stores are going away? Not in most cases, but what it does mean is the increase in complexity of place can be staggering. Just do a google search about Toys R Us's first online holiday experience, and you'll find out that logistics (part of place) is even more important in our current marketplace. It's what Amazon excels at! In my entertainment marketing class, I teach about "conduit" - the delivery of the product to the consumer, and with the increase of on-line commerce there is another channel to be measured and our product may have to take a different form. So, B-schools have got to adapt and help graduates understand how to connect their product or service with the consumer when, where and in what format the consumer wants (just think how many headaches the music industry could've saved if they had actually done this!).

What's next...Price! The author would have us believe that raw market forces will now take hold because of consumers having more access to information. Now, he does have something here - if you are positioning yourself in the market based on price, then yes- the Internet will force the market price on you, but what if you are positioning based on benefits? You aren't just focused on the raw market price you are adding value which can add dollars to that raw price. Otherwise, no diamond engagement rings would be bought at Tiffany's because they certainly don't let raw market prices determine their's. See the stuff about branding under promotion to understand why setting price is still important, plus there is that cool break-even formula we should all know.

This leaves us with the last P, Product. The article states, "The only way you can increase the value of your brand is by increasing the value of your offering." I totally agree but it is short-sighted to not realize that value comes in many forms- including those delivered by the other P's. I have a friend who uses an on-line co-op to get fresh vegetables. He pays more than he would at a grocery store, but he gets the added value of having them delivered to his door as well as being locally sourced when possible. That's "place" in action and the website that communicates what the co-op offers is part of promotion - as is the Groupon they issued (good old fashion sales promotion done with an on-line twist). I'll let you know what I think of the co-op - I bought the Groupon.

In the end, the four P's still are a good starting point but B-schools have to expand and adapt them to the current marketplace. I would argue for the inclusion of a fifth P, "participation," but maybe it's just the collaboration I talked about under promotion. What I do know is the time when a year-old text book is still up-to-date is gone.

It's Product Placement time...

Today in my Entertainment Marketing class I'm covering Product Placement - the use of brands in entertainment as a means of promotion.  The increase in DVR usage made product placement more popular, but it has been around since the turn of the last century in film.  This clip is from 1896 has Sunlight Soap taking center stage:



Brand Channel's website has a special section to track Brand Cameos in movies.  Obviously, not all of the brands listed are paid or bartered product placements, but it's interesting to see exactly how many products are used in a film.

If you want to follow news about product placement or to find out more, the Product Placement News website is a pretty cool place to gather more information.  Their articles are short and lack extensive details, but they do hit the highlights nicely.  You can also find a good but dated video about product placement in movies that I think explains product placement pretty well with lots of examples.



Movies aren't the only place that product placements happen.  TV shows, games, music lyrics, music videos, and books all are places where product placement can be utilized.  It was reported that Britney Spears earned $500,000 for product placements in her music video "Hold it Against Me" including a 6-figure payment from plentyoffish.com who claimed to have a 20% increase in traffic the day after the video premiered.

Nielsen annually measures product placement in TV- here are some results for 2011 (available here):

Top 10 Most Remembered Branded Integrations – Dramas/Sitcoms

Rank	Brand	Branded Integration Description	Program (Network/Air Date)	Recall Index
1	Purell	Sheldon uses hand sanitizer after he puts a live snake in a desk drawer.	The Big Bang Theory (CBS, Oct 27)	271
2	Red Bull	Tessa describes the official drink of suburbia; people drink it repeatedly.	Suburgatory (ABC, Sep 28)	214
3	Milton Bradley	Twister — Amy suggests that the group play the travel version of a game.	The Big Bang Theory (CBS, Nov 17)	208
4	Ferrari	Beckett drives a car after Castle explains that it is a high performance vehicle.	Castle (ABC, Feb 7)	207
5	Subway	Big Mike says that his kidnapping hasn’t been that bad because his kidnappers brought sandwiches.	Chuck (NBC, Mar 21)	206
6	Wizards of the Coast Games	Dungeons & Dragons — Wolowitz comments on the way that Sheldon plays a board game.	The Big Bang Theory (CBS, Oct 6)	205
7	Rolex	Laura comments on the price of a watch she purchased before she realizes it may have been stolen.	Pan Am (ABC, Oct 30)	204
8	Snapple	Waldon drinks a beverage while talking to Alan about his breakup.	Two and a Half Men (CBS, Oct 17)	203
9	Hasbro	Scrabble — Dick tells Susan that he’d rather play Scrabble than talk to her.	Desperate Housewives (ABC, Jan 16)	200
10	Hasbro	Monopoly — Penny wants to play a board game after getting home from a trip with Tom.	Desperate Housewives (ABC, Oct 2)	199
Source: Nielsen
Data from January 1, 2011 – November 30, 2011. Broadcast Prime. The Recall Score is the percentage of television viewers who can recall within 24 hours the brand/product of a branded integration they were exposed to during the normal course of viewing Dramas/Sitcoms. These scores are then indexed against the mean score for all integrations occurring in this genre during the time period (Recall Index). 100 equals average.
Note: For this analysis, branded integrations were only considered if the occurrence had visual elements (i.e., was “seen” on-screen) or both visual and auditory elements (i.e., was both “seen” and “mentioned”). Only first-run episodes were considered. Both planned and incidental exposures were included.

Top 10 Primetime Programs with Product Placement Activity

Rank	Program	Network	Total Number of Occurrences
1	American Idol	FOX	577
2	The Biggest Loser	NBC	533
3	The Celebrity Apprentice	NBC	391
4	Dancing with the Stars	ABC	390
5	The X Factor	FOX	312
6	Extreme Makeover: Home Edition	ABC	224
7	America’s Got Talent	NBC	220
8	Friday Night Lights	NBC	201
9	America’s Next Top Model	CW	178
10	The Amazing Race: Unfinished Business	CBS	161
Source: Nielsen
Data from January 1 – November 30, 2011. Primetime entertainment programming on five Broadcast networks (ABC, CBS, CW, FOX, and NBC). First-run episodes only. As a result of coding enhancements implemented in 2009, occurrence counts now reflect the total number of show segments in which a brand/product appears or is mentioned.

It's still shocking to see the number of occurrences of product placement in a show - 577 for American Idol!  Commercials during Idol are some of the most expensive in TV.  I can only imagine what their product placments cost.  It's also interesting to note that the most occurrences are in reality TV shows while the most remembered are in scripted entertainment.  That's good to see - especially for those of us who like scripted shows best!

This morning I was watching a video about Zynga's stock offering and came upon this clip about CityVille that mentions product and brand placement.

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The blog Social Ally did a post about BestBuy and some other product placements in games.  It's an interesting read - Online games and product placement - a good match?

So, what do you think of product placement?  Does it drive you crazy?  Get in the way of being entertained?  Or are you happy to put up with it for the ability to skip commercials?  Regardless, it is probably here to stay.