Relevance Of 7P's Marketing Mix In Contemporary Service Industries: A Study Of Amazon And Apple In The UK - Essay.

At the end of this module students will be expected to be able to:

1. Demonstrate a detailed knowledge of the major discipline with areas of specialisation. (Specific learning outcomes to be set by student and supervisor).

2. Undertake critical analysis using an appropriate range of techniques - evaluate evidence to support conclusions - application to complex situations. 

The contemporary global commercial scenario, with the occurrence of various phenomena of international significance, like those of Globalisation, trade liberalisation in different countries as well as development of technological and infrastructural scenario, has become more integrated, inclusive and interconnected. Businesses, in the current period, operate in a much competitive and dynamic environment, with consistently increasing competition as well as rapid changes in the preference and demand patterns of the customers, which in turn makes it immensely crucial for them to stay efficient in order to sustain in the market stay profitable (Belz and Peattie 2012). The marketing strategies and plans adopted by the businesses, in this context, play significant role in assuring the sustainability, profitability and competitiveness of a business. Over the years, various new marketing theories have evolved in the global scenario and have been undergone changes and additions with time and changing business frameworks, of which one eminent one is that of the 7P’s of marketing mix which specially evolved in the context of service sector industries (Zimmerman and Blythe 2013).

Keeping this into consideration, the concerned report tries to analyse whether the theory still holds relevance and which of the 7P’s are still applicable in the modern-day service industries. To study the same, the report emphasizes on the service sector of the United Kingdom and specifically focusses on two of the eminent multinational giants, Amazon and Apple, with the objective of exploring the relevance of the marketing mix theory in the marketing and operational framework of the concerned company in the UK.

The theory of the 7P’s of marketing mix evolved in the 1980’s, as an improvement or extension over the traditional theory of 4P’s of marketing mix (1940’s), in order to incorporate the marketing aspects in the service sector industries across the globe. The model gained immense popularity and many companies, have over the years applied this theory and its components in forming their marketing plans and strategies (Gillespie and Riddle 2015). However, with time and improvement in the technological framework as well as with the emergence of an integrated and inclusive global market, the demands of the customers and their level of awareness as well as their modes of interactions with the companies and businesses have undergone huge changes. Much of this can be attributed to the invention and increasing usage of internet, which have contributed immensely in changing the ways in which the companies indulge in marketing their products and services and in attracting different clientele in the contemporary period (Onetti et al. 2012).

Service Marketing

The forms of marketing have become more interactive and pro-customer in the contemporary period of higher customer awareness and interactions. In this context, it becomes immensely crucial to analyse whether the conventional model like that of 7P’s of marketing mix, still hold relevance and if yes then which of the P’s are still significant (Flint and Woodruff 2014). It is also important to explore the ways in which the 7P’s can be incorporated in the new ways of marketing by the companies, especially those venturing in the service sectors. This indicates towards the importance of the concerned report, which tries to analyse the relevance of the same, in real service sector scenarios of the UK, emphasizing on companies like Amazon and Apple.

The concerned research aims to explore the relevance of the 7P’s of marketing mix, in the contemporary service sector industries and also tries to find out the members of these 7P’s which are still significant and also the ways in which this marketing mix model can be modified (if required) and applied in the contemporary period, specifically in the service sector industries of the UK. The study also focusses on two of international companies of immense prominence and popularity, Amazon and Apple, operating in the UK, in order to analyse the relevance of the concerned marketing model as a whole and its different components individually.

The objectives of the concerned research can be seen to be as follows:  

• To analyse the validity and relevance of the 7P’s of marketing mix in contemporary service sector industries in UK, focussing on Amazon and Apple
• To find out which of the P’s of this model still hold relevance and why
• To analyse the ways in which this model and its components can be modified and incorporated in the contemporary service sector marketing models
• To find out the advantages of the model
• To find out the limitations of the model

To analyse the relevance of the 7P’s marketing mix model in the contemporary period, especially in the service sector of the UK, secondary qualitative data have been collected about the marketing strategies and activities of Amazon and Apple, in the United Kingdom, especially in the aspects relevant to the components of the 7P’s of marketing mix, from different sources (literary works, scholarly evidences, journals, online databases and articles published in esteemed news and literary sites). A thematic analysis has been conducted based on the responses collected in order to infer about the relevance of the model into consideration and about the elements in the model which still holds significance in the marketing strategies of the concerned companies in particular and in the service sector of the country as a whole.

A brief introduction of the issue of consideration, along with the research objectives, aims and the methodologies used has been provided in the first chapter, followed by an extensive review of the literatures present in this domain in the second chapter. The third chapter elaborates about the methodological framework and the tools used to carry out the research activities and the findings of the research are discussed and interpreted in the fourth chapter. The final chapter includes a brief overview of the study along with the limitations and the future scopes of study in this domain.

Evolution of Marketing Mix Model

With the increasing dynamics in the operational frameworks of businesses across the world, owing to the increase in the level of competition and fight for sustenance on part of the businesses in any kind of industry, the marketing strategies adopted by the same have also been undergoing consistent changes and developments. With time and evolution of new needs (both from the demand side as well as from the supply side) and with the technological and infrastructural innovations, new marketing models are getting developed and the old ones are undergoing changes or are becoming redundant (Wilson et al. 2012). In this context, huge amount of literary works can be seen to be present regarding the evolution, changes, applications and relevance of the 7P’s marketing mix model in different industries across the globe. Keeping this into consideration, this section of the report tries to conduct an extensive review of such relevant literary works and empirically supported scholarly evidences present in the domain of interest for the concerned study, in order to comprehend and incorporate the perceptions and opinions existing regarding the same, especially in the domain of service marketing.

To understand the concept of 7P’s marketing mix it is crucial to understand the concepts of service and service marketing and also their implications. Foxall (2013), in this context, defines the term service to be an intangible form of economic activities, which are offered by one party to the another in lieu of rewards (in cash or in kind). As per the assertions of Huotari and Hamari (2012), the customers availing services from the providers, expect value, skills, facilities or networks in exchange of money or time and unlike the customers for products, they do not own any kind of physical or tangible element. The unique and distinctive characteristics of services (which distinguish them from products), as highlighted by Taherdoost, Sahibuddin and Jalaliyoon (2014), are as follows:

Inseparability- As per the assertions of the authors, the production and consumption activities related to a service (unlike that of commodities) cannot be separated.

Intangibility- Unlike products, services cannot be touched or interacted with any of human senses conventionally, which in turn implies that the ownerships of services cannot be transferred and before availing the services the quality of the same cannot be perceived by the customers (Lovelock and Patterson 2015).

Variability- As highlighted by Rubalcaba et al. (2012), the quality of services varies across the providers as well as the perceptions of the customers, which in turn make the management of service quality and standardisation of the same immensely difficult and subjective.

Research Objectives

Perishability- The services, unlike products cannot be pre-produced and stored in inventories for smoothening demand-supply dynamics, which in turn indicates towards the absence of any kind of supply buffers in case of service provision (Lovelock and Patterson 2015).

All these factors and the unique characteristics of services (different from that of products or tangible commodities), as asserted by Gummesson and Grönroos (2012), led to the creation of a new genre in the domain of marketing, known as “Service Marketing” in the global scenario, in the early 1980’s. The service marketing framework, as highlighted by the authors, in general focus on marketing of different types of services, including both business-to-business (B2B) as well as business-to-customer (B2C) services. Over the years, with the increasing importance of the service sector industries in the global scenario, this type of marketing has received immense significance and relevance and different marketing models and conceptual frameworks have evolved in this domain, one of the most prominent of which is the Marketing Mix (7P’s) Model (Londhe 2014).

Perreault, Cannon and McCarthy (2015), discusses the evolution of the now-observed Marketing Mix model as an extension of the traditional marketing mix model (popularly known as the 4P’s), which evolved in the 1940’s as one of the foundations of global marketing models and concepts. The authors define the same as an accumulation of marketing tools for the businesses in order to achieve their marketing objectives and the organizational goals as a whole. The primary components of the traditional model, indicating the four broad factors influencing the marketing decisions of the businesses are product, promotion, price and place.

However, as argued by Gordon (2012), with the increasing importance of service marketing in the global framework and with the unique and differentiable features of services becoming more prominent, a need for amendments in the conventional form of marketing mix was felt, which in turn led to the development of the 7P’s marketing mix model, specifically suitable for service sectors, with an additional three P’s which are discussed in the following section.

The 7P’s of marketing mix, referring to the seven factors which have to be considered while forming marketing decisions, specifically in the service sector industries. 

Keeping this into consideration, the 7P’s of service marketing mix, as discussed by Hashim and Hamzah (2014), can be seen to be as follows:

1. Product-As highlighted by the authors, the primary factor influencing marketing decisions of any business is the product which the same offers. In case of service sector companies, the same is intangible, with inseparable production and consumption and also with perishability. This in turn increases the scopes of customization of the same as per the needs of the customers, over-emphasis on which, however, compromises the standardization aspects. This in turn, indicates towards considerable importance of proper designing of the services offered by the firms (Aghae et al.2014).
2. Price-This component highlights the amount which a company charges from a customer in exchange of the service offered by the same. According to Brooks and Simkin (2012), pricing services are more complicated as along with the costs of tangible inputs, the costs of intangible ones like labour and overhead costs are also needed to be considered.
3. Promotions- This component demonstrate the importance of the sales promotion, advertising, social media marketing and more for the organisation. As per the Jackson and Ahuja (2016), it can be considered as the method to expose a business to the wide amount of prospect customers.
4. Placement- This part of the strategy mix demonstrate the availability of the product and as per Islam and Rahman (2015), in order to grow the business and its performance, product need to be available in different part of the operation region of the firm.

Over the time, in order to make justification with the recent change in the market, strategy mix has also evolved and incorporated the following strategies for the business success.

1. People- Person who are connected with the business are now considered as the essential element of the growth of factor. As per (Harrington et al. 2017), depending upon the same a business can enhance its performance and leads to higher productivity.
2. Process- Customer presentation has been considered as the essential component of the business process during present date. Thus business process has been inserted into the modified strategy mix model.
3. Physical evidence- Presence in the market and physical existence of the firm adds to the performance parameter of the firm. Thus, physical evidence has been considered and it can effectively enhance the business process through omnipresence within the operation region (Mayer, Melitz and Ottaviano 2014).

As per the industrial marketers, there is long claimed debate regarding the industrial marketing strategies and over the years it has transformed as one of the important topic for the researches. Most of the researches revolves around the question that how marketing mix strategies are effective and essential for the present date. Though there have been moderate amount of evidence regarding the performance of the marketing mix model like 4P, yet researches have failed to demonstrate the relevance of the extended version in the present date. As per the research of Sharma (2015), it can be found that marketing mix model delimits the distinct, independent and well defined process of management. Fine (2017) has highlighted the fact that, policy implementation as per the 4P marketing mix model can be acknowledged as one of the most serious issues during the present date. As the market has been evolving at a daily basis, it can be seen that the factors of the marketing mix model has jeopardised the model of growth. Besides this, as per Jin (2017), it can be seen that marketing mix model do not consider customer relationship and fails to capture the importance of customer behaviour that are crucial for the performance of the firms. Moreover, marketing mix do not consider the unique elements of the service marketing and the marketers has been the central element of the strategy rather than customer that reduce the acceptability of the same during the present date (Buhler and Nufer 2012).

From the above discussion it can be seen that over the years there has been large amount of changes within the strategy mix framework so as to make it aligned with the need of present date market scenario. However, with moderate extension within the dimension of the strategy mix, they have certainly extended their capability to provide explanation regarding the business growth, yet most of the researches has failed to determine to which extent they are required during present date. As it can be seen from the literature review section, that most of the researchers has tried to analyse the ability of the strategy mix models, however, most of them has failed to provide a detailed explanation regarding the fact that how it can define the growth prospect of the firms like Amazon that operates under the E-commerce market segment. Moreover, it can be seen that previous researches has tried to explore the idea that how to enhance the policy implication through the strategy mix model, rather than justifying their utilisation within the operational framework of the business during present date. Thus, there is moderate amount of the gap within the studies that has been done in this regards and most of them has failed to provide an explanation regarding the usefulness of the strategy mix model in today’s business environment.

Conclusion:

From the above discussion it can be seen that there has been moderate amount of deviation regarding the finding of strategy mix. Some of the researches has showcased that utilising the strategy mix model, business performance of the firms can be enhanced, whereas some has criticised the same. Though most of the research has failed to demonstrate the value relevance of the strategy mix model during the present dare business framework, some has argued that with the utilisation of the strategy mix model, firms can effectively bring in newer policies to tackle the market fluctuation and threats. On the other hand, it can also be seen that, a major portion of the researchers has argued that, strategy mix do not consider customer behaviour, consumer relationship that reduce its acceptability during the present date, where both the aforementioned variables are essential for the success of the business. Considering the various finding, this present research will go for the determination of the relevance of the marketing mix and the research question of the present study has been mentioned below.

Considering the above explanation regarding the previous study in case of marketing mix, present research will try to analyse the following primary research question:

What is the value relevance of the marketing mix in the present date service industry in UK?

Keeping this into consideration and focussing on the two multinational giants in UK, namely Amazon and Apple, the research tries to explore the following secondary questions under the domain of primary research question, which are as follows:

1. What are the service marketing strategies taken by Amazon in the UK?
2. What are the service marketing strategies taken by Apple in the UK?
3. Which components of 7P’s of marketing mix are relevant in the service marketing aspects of Amazon and Apple?
4. What modifications can be brought in the 7P’s marketing framework to increase the relevance of the same in the contemporary service sector marketing scenario in the United Kingdom?  

For any research to be robust, authentic, relevant and true to its purpose, it is of immense importance to form an appropriate research methodological framework, consisting of proper research tools and techniques, approaches and methods, for conducting various research related activities in the studies (Neuman 2013). Keeping this into consideration, this section of the report discusses the research methodological framework formed for the concerned research, consisting of the methods, tools and approaches used to study the relevance of the 7P’s of marketing mix, in the domain of the service sector in the United Kingdom, emphasizing on the marketing operations of Amazon and Apple in the concerned country.

With the changing patterns in the global marketing scenario and with the increasing popularity and dominance of the service sector industries in the UK as well as across the globe, it has become immensely crucial to study the relevance of the conventional marketing models in the contemporary period. In this context, there remains huge scopes for future study and research regarding the relevance of the 7P’s of marketing in the service sector industries in the future and the changes which can be brought in the conventional model to increase its applicability, relevance and significance in new-age pro-customer and pro-technology service marketing scenarios.

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