You’ve probably heard of the “Four Ps of Marketing.” If not, the 4Ps—Product, Price, Place, and Promotion—are the key elements that help businesses strategize how to develop, price, distribute, and promote their offers effectively.

If a company was a house, Price and Place would be how much the house is worth and where it is located—very important elements that are frequently discussed. Promotion would be the fancy cabinets and the fresh coat of paint on the kitchen walls. There are millions of blogs, YouTube channels, and TV shows about home decor, and many homeowners think their house will double in value if they put a fresh coat of beige paint on the walls. Finally, Product is the house itself: the walls, foundations, plumbing, insulation. It is not the “sexy” part of the building, something people even avoid discussing sometimes, but a house with structural issues will be a lot less attractive to buyers.

The same thing is happening in ecommerce. There’s a lot of focus on Promotion, with entrepreneurs thinking a new flashy campaign will solve their problems. On the other hand, there’s not enough talk about the product, which is a problem for many sellers. This is especially true in 2024 when the market is more competitive than ever, and a strong brand and value proposition are necessary to succeed. So let’s review these 4Ps and how they are approached today.

Why Promotion, Although Necessary, Is Often Overhyped

“Promotion” means the communication strategies used to inform and persuade customers about the product. This includes, but not limited to, advertising, sales promotion, public relations, or social media. Promotion decisions focus on how to effectively reach and engage the target audience.

Promotion is often the main focus of entrepreneurs for a few reasons. First, the impact on revenues is fast. Unlike developing a new product or building a DTC channel, striking deals with influencers can very quickly drive traffic and sales. PPC campaigns can work even faster if a company decides to increase its budgets.

Next, because it is the easiest to do. I’m not saying it’s the easiest to do right, but it is the easiest to start working on. Tweaking budgets, keywords, and creatives are rarely expensive and can be done quickly. Even adding a new advertising channel isn’t difficult (scaling and being profitable is a different story).

Another reason is risk. Adding or removing promotional channels isn’t the riskiest choice a business will face. Very few customers would be upset if they stopped seeing ads for their favorite brand on TikTok or Instagram. And in the worst-case scenario, decisions regarding promotions aren’t terribly difficult to reverse. Sure, problems can occur if a campaign is terrible enough to damage the brand image (such as the “Coolest Monkey in the Jungle” ad by H&M), but these are fortunately rare occurrences.

Finally, the ecommerce world is saturated with ads and marketing agencies. I’d say 80% of the sales emails I receive are from marketing, SEO, or most often PPC agencies trying to sell me their services, sometimes with unrealistic claims. Advertising is often seen as the fun and attractive part of ecommerce, and it can be tempting for new entrepreneurs to be overly focused on it, at the expense of products, pricing strategies, supply chains, or analytics.

To be clear, I don’t think Promotion is worthless. Quite the opposite, I believe it is a key part of any business. My point is, there is more than Promotion, and entrepreneurs should not make it their only focus.

Price and Place Are Getting Some Attention

Updating product Prices immediately impacts a business’s financials, including both top and bottom lines. It influences customers’ demand and their perception of the products (expensive items sometimes appearing more exclusive and higher quality). It is a very impactful decision for existing customers. Increasing prices may slow down customer demand and upset existing customers who are used to the lower prices. On the other hand, decreasing prices can attract new customers, but frustrate those who bought previously at high prices and negatively impact the brand image.

Changing the whole pricing strategy is a massive decision for a business. However, small to medium businesses in the ecommerce space have more freedom in this area. If they don’t have an extensive network of resellers and distributors, they typically have more control over their prices. Ultimately, many businesses could benefit from experimenting with different pricing strategies (see my post here: Pricing Strategies for the Ecommerce Entrepreneur). Too many are still applying cost-based pricing or copying competitors’ pricing.

Place gets a little more attention in the ecommerce world. New sales channels are popping up every day. TikTok Shop is all the rage now, and who knows what the next hot thing will be. However, while it is very important to stay up to date on new trends, I don’t recommend entrepreneurs mindlessly launch their product on the latest cool channel. The right sales channel mix depends on a business’s products, cost structures, industry, competitive landscape, and many other factors. Businesses with limited resources should be focused on what will ensure long-term growth and profitability.

Many Times, Product is the Problem Brands Don’t Want to See

The Product is the cornerstone of a company’s strategy. It influences the pricing and marketing strategies, the sales channel mix. A bad product makes it very difficult to generate a profit, even with the best influencers, marketing campaigns, and the greatest PPC ads teams. Not saying it never happens (in fact, there are many terrible products sold successfully), but winners are very few compared to the millions of unsellable products.

So why is there so little discussion on products? The first reason is how difficult it is to change a product after launch or create something new. Adding a new sales channel or launching a new advertising campaign is way easier than building something to sell. Product development expenses can add up, while the revenues and profits are not seen until after the product is launched.

It is incredibly hard for an entrepreneur to realize their products are terrible. Their products are not only a financial investment but also an emotional commitment. Even when they don’t care about their product, recognizing failure and moving on is difficult. This is especially hard when a product was performing well in the past but became outdated or the market became too competitive. A good example of this phenomenon would be US sellers offering white-labeled products for sale on Amazon in 2015-2017. While this model worked relatively well at the time, Amazon has seen an influx of Chinese sellers during the Covid pandemic, which slashed prices and forced a lot of these previously successful sellers out of business.

Agencies won’t tell businesses how to build successful, innovative products. If they could come up with great business ideas, why wouldn’t they use them for themselves? Instead, most of the content online addresses either the 2-3 other Ps of marketing or discusses low-barriers to entry models such as dropshipping or white labeling. Few people would approach failing businesses to tell them “Your products are the problem and no amount of marketing can fix that.”

Conclusion

What is the point of all this talk? My conclusion will be short: ask yourself the right questions. If your financials are disappointing, can it be fixed by addressing a new channel, tweaking your pricing policy, or creating new campaigns? In some cases, the answer is yes. But sometimes (especially for newer companies with less brand equity), the problem is deeper and lies in the last P of marketing: Product.