In 1960, E. Jerome McCarthy gave us the 'Four P's' - Price, Product, Place, and Promotion - as the bedrock of advertising. Fast forward to today's digital age: how have these 'Four P's' adapted?

Regular revaluation of fundamental principles for the online landscape is not just wise - it's essential. Dusting off the Four P’s, and bringing it back to basics, we take a look at how these traditional advertising concepts have been redefined with the modern consumer in mind, as well as some examples of success stories from across the industry.

Product 

In this digital age, the definition of a ‘Product’ has expanded beyond the confines of physical commodities and conventional services. Today, products encompass a vast and diverse array of offerings that range from intangible software solutions, data-driven analytics, and immersive media experiences to more traditional physical goods. This evolution reflects the evolving preferences and behaviors of consumers, who increasingly seek value, convenience, and personalisation in their interactions with brands. 

With today’s consumers, the way a product is perceived gains importance through brand resonance. An example of successful product placement can be seen with Boxshare, the men’s footwear company that found itself losing out to bigger brands such as Nike and Adidas. Through a programmatic display campaign, the brand not only surpassed Google benchmarks but also caused a significant disruption in the fiercely competitive market. This accomplishment stemmed from the brand's ability to resonate with its audience's values, as evidenced by its display advertisements achieving an impressive click-through rate (CTR) that was 233% higher than Google's benchmarks in the UK and 800% higher in Germany. Furthermore, a noteworthy 85% of the visitors to the website resulting from prospecting activities were entirely new users, indicating the campaign's effectiveness in expanding the brand's reach and attracting fresh interest.

Place

In the digital era, McCarthy's 'Place' - dubbed the distribution pillar among the four P's - has shifted gears from its traditional brick-and-mortar roots. Once centered on physical outlets and geographic locations, 'Place' now spans a sprawling network of online platforms, from e-commerce sites to in-game ads and social media. The digital revolution, fueled by e-commerce, mobile apps, and social channels, has redefined how brands reach consumers, globalising access like never before. Amid this burgeoning virtual marketplace and the rise of omnichannel strategies, businesses must smartly pinpoint their place to stand out.

Many brands utilise programmatic platforms for successful placement, automating the buying and selling of ad spaces, and deciding in real-time where an ad will be most effective based on a host of variables like user behaviour, website content, and time. A success story can be seen with The Economist, who wanted to appeal to a younger audience. Within their campaign, display advertising was employed to engage an audience of 650,000 individuals with the intent of converting them into subscribers. The advertisements were tailored to various user segments, which were delineated according to the browsing behaviour of existing subscribers, encompassing areas such as finance, politics, economics, philanthropy, and technology. Through contextual targeting, The Economist strategically positioned these ads to maximise relevance and impact through accurate placement. The campaign yielded significant results, attaining half of The Economist's subscription goal of 650,000 within a nine-day period.

Price 

In the realm of ad tech, McCarthy's marketing principle of "Price" undergoes significant transformation while retaining its core function of determining the value of a product or service. Traditionally, price is set through a combination of factors like production cost, demand, and competition. However, in digital advertising, price becomes a dynamic entity, often determined in real-time through bidding algorithms in programmatic platforms. These platforms allow advertisers to set the maximum amount they are willing to pay to reach a specific audience segment, and the automated system matches ads with the highest bidder to available inventory. This real-time pricing mechanism introduces fluidity and competition into the advertising ecosystem, allowing for market forces to determine the value of ad placements instantaneously. The principle of "Price" is thus adapted to the unique, fast-paced needs and capabilities of the digital advertising world.

Procter & Gamble (P&G) serves as a compelling example of successful real-time bidding in programmatic platforms. P&G has been reported to significantly increase its investment in programmatic advertising, using real-time bidding to efficiently target their ads to specific consumer segments. By leveraging data analytics, P&G could set bids for ad spaces where their target demographics were most likely to engage, such as websites or apps related to home care or personal hygiene. This approach has been credited with driving cost-efficiency and improving ROI for the company's diverse brands, from Tide to Gillette. The real-time bidding strategy allowed P&G to maximise the value of each advertising dollar, ensuring that ads reach consumers with the highest propensity to engage or purchase, thereby aligning closely with their overall marketing objective.

Promotion 

Promotion remains a cornerstone of advertising, but the methods have evolved drastically. Traditional advertising channels such as TV and print have been complemented and, in some cases, overshadowed by digital advertising. 

In the digital arena, “Promotion” encompasses targeted advertising campaigns executed through various channels like social media, search engines, and advertising platforms. Advanced algorithms and data analytics are employed to deliver personalised promotions to individual users based on their behavior, preferences, and historical data. The goal is not just to broadcast a message but to engage with the consumer in a more meaningful way, enhancing both reach and conversion rates.

In a prime example of promotion within targeted advertising, Joe Kidd, the strategy director at m/SIX, presented the approach taken to promote Tango's new, ‘Berry Peachy' beverage at ExchangeWire’s ATS London event held in June this year. Focusing on Generation Z as the key demographic for growth, Kidd outlined that understanding the consumer was the initial step in the brand’s 'wow me' strategy. To maximise reach and engagement, m/SIX collaborated with ‘trendy’ platforms, such as LadBible. The content was distributed as a news story on LadBible and received an unprecedented response - accumulating 17,000 likes and comments on its first day alone. This made it the most interacted-with piece in the history of LadBible. The final result of the campaign was Tango’s Berry Peachy coming out as the number one selling new product development across the soft drink category by volume.

Evolution, Not Extinction 

Advertising and ad tech have undergone seismic shifts, and yet the Four P's retain their pivotal roles, albeit in a much more complex and dynamic environment. Advanced algorithms and real-time data analytics have revolutionised how we perceive 'Product,' facilitating dynamic adjustments to 'Price,' and offering countless 'Places' through various digital platforms for advertisements to appear. 'Promotion' has evolved into multi-channel strategies, encompassing everything from social media to programmatic buying. As the frontier of advertising continues to expand into the digital realm, the Four P's act as both a compass and a constant, guiding businesses through the intricate maze of modern marketing. In essence, they serve as the DNA of digital commerce - immutable yet adaptive, guiding businesses to evolutionary success.