Everyone has his own model of Marketing, starting from 4 P to 7 P, to 4 C and beyond.
Let me add my one bit to the debate.
My model is based on treating the word PRODUCTS as an Acronym. You might ask Why Products? Simple - Marketing do not have a cause to exist without a Product (or Service). It is the foundation on which Marketing edifice is built.
The first letter 'P' represents PRICE.
The price has to be viewed from two angles. The Maximum price that the Customer is willing to pay and the Minimum Price that the Seller can afford to charge to stay in business. Both do cost-benefit analysis, and would effect the transaction if the B/P is => 1 for the Customer, and P/C=>1 for the Seller - B,P,C standing for Benefit, Price and Cost respectively.
Higher B/P for customer means lower P/C for the Seller as C increases with increase in B. A very high B/P for the customer would make the transaction unprofitable for the seller, who will then back out of the transaction. Similarly, a very high P/C for the seller, which is effectively exhorbitant profit, would make the B/P considerably less than 1 for the buyer, who will look for alternate solutions, jeopardising the deal. An equilibrium point between the two will be one when the transaction is effected, which in effect means a Win-Win situation. Succesful marketing stories are all about creating these Win-Win Situations.
Quarter of a century ago, I used to visit my brother regularly while he was working with IOB in Delhi. We would go to Karol Bagh monday market for purchasing dresses. My brother would ask the price of a kurta and the salesman would say Rs 100. Brother would make a counter offer of Rs 10. Then the haggling starts. At that point B/P for my brother is very high and the P/C for the shop owner very low. It is a no-go situation. The shopowner reduces in stages of Rs 10, while my brother increases his offer in stages of Rs 5 or 10. At around Rs 35, there is an acceptable B/P - P/C trade off, and the deal is effected.
The model will be revealed in parts in the subsequent blogs. Keep coming back.
