Using the 3 P's in service based businesses' marketing mix (2023)


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(Video) The Marketing Mix for the Service Industry: The Three P's

Published: May 04 2018

Last Updated:Aug 11 2022

Are you aware of the "3 forgotten P’s of marketing"? If your business offers services to its customers, you should definitely read on.

The four P’s, a staple of the marketing world, touch on a few important factors to consider when developing a marketing strategy: product, price, promotion and place. What it is that you’re selling, for how much, how you will promote it and where you will sell it.

These four P’s are important, but they’re not what this article is about. Instead, we’re going to talk about the three often forgotten P’s of marketing which apply specifically to service businesses: people, process and physical environment.

Service businesses vs. product businesses

Service-centric businesses are very different from product-centric businesses, so it makes sense that they each have unique considerations when it comes to marketing. Unlike products, services are intangible, perishable, and their production, purchase and consumption are often concurrent.

Many businesses offer both products and services. Take a restaurant for example. The food is the product, but everything else involved in the experience is a service: the quality of the hostessing and serving staff (people), how quickly the food is served (process), and the restaurant’s ambiance (physical environment).

What exactly are the three P’s of service marketing?

While the original four P’s still apply to service businesses, these additional aspects are equally as important. In this section, we will cover some details and examples of the three forgotten P’s.

1. People
2. Process
3. Physical Environment

We know you are just getting started on this article but if you’re interested in this topic you may want to spend a few more minutes to learn:

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Who provides services to customers? In most cases, it’s people. The quality of the service being provided by a company’s people largely contributes to the customer’s overall experience, which is why many service-based businesses view their employees as an investment.

When it comes to the people aspect of a service business, there are two types of marketing involved: internal marketing and external marketing.

Breaking down internal marketing
A great service business realizes that in order to offer customers the best experience possible, its employees must be on board, which requires internal marketing. This is why service businesses are usually prepared to invest additional time and money to ensure that their employees are well-trained and engaged.

Breaking down external marketing
External marketing involves the interaction between employees and customers. This is where elements like training, sales scripts, and employee image come into play.

Seeing It In Action

One great example of this here in the Okanagan is the staff at Hotel Eldorado Restaurant. Not only do the staff offer excellent customer service, but the matching uniforms that Csek Creative created offer an appearance of professionalism, cleanliness and teamwork.

Concerning internal marketing, the staff at Hotel Eldorado Restaurant have their own personalized online dashboard called Crew Connection. Csek Creative created this internal resource as a way for the Eldorado team to stay connected and access useful information such as health benefit details, career opportunities, menu details, orientation guides and more.

Remember, as a service company, your people truly are your greatest asset! So make sure that the way they speak and present themselves aligns with your brand.

Having trouble finding and retaining great new staff in 2022? We may be able to help.

(Video) 7 Ps of Marketing | Marketing Mix for Services | Explained with Example

Using the 3 P's in service based businesses' marketing mix (2)

Using the 3 P's in service based businesses' marketing mix (3)


For every service-based business, there is a process that happens behind the scenes to make that service possible. Your processes contribute to the overall experience you offer, and are also a great way to differentiate yourself from the competition.

Ask Yourself 2 Quick Questions

  • What do your processes look like, and how do they make you unique?
  • Does it make your service faster than the competition? More affordable? More memorable? More reliable?

It’s true that processes look different for everyone, but the one thing that is important for businesses of all kinds is that these processes remain consistent, ensuring that your customers’ experiences are also consistent.

(Video) The 4 Ps and 8 Ps of Marketing - A Marketing Mix

Creating a service blueprint can be a great way to not only maintain consistency, but discover potential opportunities to improve your processes and therefore the experience that you offer. A service blueprint draws out each step in your processes, including actions that are visible to the customers, and ones that happen behind the scenes. Being able to view the big picture can make it easier to spot opportunities that would have otherwise gone unnoticed.

Seeing It In Action

Csek Creative assisted Waterway Houseboats in refining their booking processes to make things easier for both customers and staff. Where customers used to have to spend up to an hour at the office prior to boarding a houseboat to fill in various forms and watch a safety video, this is now all easily accessed online at the customer’s convenience, and the data is collected in a central system where it is easily accessed by staff. As well, the new Cruise Director app allows customers to plan their trip and coordinate the rest of their crew with ease.

By reviewing the booking process from the very beginning, to the moment customers step on the boat, we were able to smooth out some of the biggest pain points for both Waterway Houseboats, and their customers, through creative thinking and technology.

Physical environment

Since services are intangible, businesses often make up for this by putting additional effort into the physical environment where the service is being offered. Basically, physical environment is the appearance and overall vibe of the area where the service is received.

When choosing a restaurant, customers will consider its ambiance - lighting, decor and so on. When choosing a hair salon, customers may consider whether the waiting room has comfortable seating and reading material available. A sign advertising a great deal on oil changes may tempt customers to choose one mechanic over another.

Service businesses can take advantage of their surroundings to make the experience more memorable, simple, tempting, extravagant or comfortable for customers.

Depending on your business and your goals, altering your business’s physical environment could be as simple as acquiring some assets and materials to add to your space, such as signage to make it easier for customers to navigate your building.

Sometimes, it means re-inventing your space by investing in special decor or interior design. Hiring a professional interior design service, such as Kelowna’s the Hatch which specializes in design for commercial spaces, often pays off for service businesses

Seeing It In Action

Csek Creative helped the Okanagan’s Quality Greens Farm Markets enhance their physical environment with posters, till-talkers and customized recipe cards, which are placed near the produce that is needed to make the recipe.

The posters and till-talkers let customers know about special services the store offers, such as points cards, e-Newsletters and contests. The recipe cards, which are free for customers, enhance their experience by offering them a little something extra while also encouraging them to make additional purchases.

However, it is important to note that "physical" marketing is not just about in-store advertising. It is about the feel and ease of use of the location as well! And if you ever walk into a Quality Greens - you will quickly realize how it was designed to align to the Quality Greens brand

How you use the three P’s depends on your business

When it comes to people, processes and physical environment, no two businesses are completely alike. Where one restaurant may rely on its professional wait staff, award-winning chefs and upscale atmosphere, another may be well-loved for its order-at-the-counter service, comfort food dishes and quaint decor.

Two businesses may be in the same industry, but the way they choose to run that business and the appeal they offer to their clientele can be completely different. One thing that remains the same, however, is the importance of the three P’s.

Mainly, it’s important to remember to utilize the three P’s to market your business in a way that is consistent and supports your competitive advantage. If you need assistance determining a marketing strategy for your service-based business, we'd love to help.

Book a no-obligation consultation today

(Video) Additional 3 Ps of Service Marketing Mix

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(Video) Marketing Mix | 7 p's of Marketing | 3p's of Service marketing | By Subendu Choudhary


What are the 3 Ps of marketing mix in services? ›

Instead, we're going to talk about the three often forgotten P's of marketing which apply specifically to service businesses: people, process and physical environment.

Can service businesses use the marketing mix? ›

Services Marketing Mix consists of a set of tactics that a company can use to promote and encourage potential customers to buy their services. The services marketing mix is also known as an extended marketing mix and is an integral part of a service blueprint design.

What is service marketing mix with examples? ›

The service marketing mix is a combination of the different elements of services marketing that companies use to communicate their organizational and brand message to customers. The mix consists of the seven P's i.e. Product, Pricing, Place, Promotion, People, Process and Physical Evidence.

What are the P's of business marketing of product and services? ›

What are the 4 P's of marketing mix? The 4 P's are Product, Price, Place, and Promotion.

What is meant by the 3 Ps in customer service? ›

Essentially, the 3 important qualities of customer service center around three “p”s: professionalism, patience, and a “people-first” attitude.

What does the 3 P's represent and how can this be formulated in business? ›

If you want your business to succeed, you absolutely must focus on three key variables: people, process, and product. The three Ps, as they're often called, provide the highest return for your efforts because they act as the cornerstone for everything your business does.

What are the marketing mix that apply to service marketing? ›

Traditional marketing mix elements are composed of product, price, place, and promotion. These 4Ps also apply to service organizations. However, in addition to the traditional four Ps, the services-marketing mix includes three more factors: people, physical evidence, and process.

How can marketing mix be used to enhance services? ›

10 Steps to an Effective Marketing Mix
  1. Goals and Objectives. ...
  2. Establish Your Budget. ...
  3. Determine Your Unique Selling Proposition (USP) ...
  4. Who is Your Target Market? ...
  5. Ask Your Customers Advice. ...
  6. Define Your Product in Detail. ...
  7. Know Your Distribution Channels. ...
  8. Create a Pricing Strategy.

What is the importance of services marketing mix? ›

Importance of Marketing Mix

Helps understand what your product or service can offer to your customers. Helps plan a successful product offering. Helps with planning, developing and executing effective marketing strategies. Helps businesses make use of their strengths and avoid unnecessary costs.

What are the characteristics of services marketing mix? ›

The 4 Characteristics of Service Marketing. Service marketing has four distinctive characteristics; intangibility, inseparability, variability, and perishability.

What is the importance of product in service marketing mix? ›

The role of product in the marketing mix is one of the key components that makes the entire process of connecting with consumers and generating sales possible. Along with price, place, and promotion, the product provides the ultimate value to the customer and serves as the entire reason for the marketing effort.

How many P's are in service marketing? ›

Importance of 7P's marketing

The 7Ps of marketing are – product, pricing, place, promotion, physical evidence, people, and processes. The 7 Ps make up the necessary marketing mix that a business must have to advertise a product or service.

How many Ps are there in services marketing? ›

The 7 Ps of marketing. Marketing is delivered through a combination of elements—the 'marketing mix'. These elements are also often referred to as the 7 Ps of marketing.

How do the 4Ps of service marketing works? ›

The 4Ps of marketing is a model for enhancing the components of your "marketing mix" – the way in which you take a new product or service to market. It helps you to define your marketing options in terms of price, product, promotion, and place so that your offering meets a specific customer need or demand.

Why do services have 3 extra P's? ›

The additional 3Ps are People, Process and Physical Evidence. Why additional P's? These additional 3P are required because of the special characteristics of the Service Industry. The product of a service industry is not tangible.

Which of the three Ps do you feel is most important when building a business? ›

Of the three “P”s, “people” are the most important. Without good people, good processes and good products only do so much. Simply put, the “right” people are effective while the “wrong” people can destroy a business. And what's “right” for one business may not be for another.

What is the 3P approach to quality? ›

Process, product and people are the three key elements of a company's quality system and all of them need to be focused on for an overall improvement in performance.

What can you add on the three 3 Ps of a successful business? ›

3 P's to Business Success – People, Product, and Process.

Which P in the marketing mix stands out as the most important for any business and why? ›

As the internet has levelled the online playing field, one P has emerged as the clear focus for most consumers: Price. In fact, price is so important, McKinsey found that just a 1% improvement in pricing raises profits by 6%.

How do you use the marketing mix example? ›

What is the marketing mix and how can you use it?
  1. Product. The product must do what consumers expect it to do. ...
  2. Price. The product's price should reflect the attributes of your target market as best as possible, pitched at the right level, but still turning a profit. ...
  3. Place. ...
  4. Promotion. ...
  5. People. ...
  6. Processes. ...
  7. Physical Evidence.
Jun 10, 2019

What is the difference between marketing mix and service marketing mix? ›

In a product marketing, only 4 P's of the marketing mix are applicable which are product, price, place and promotion, but in the case of service marketing, three more P's are added to the conventional marketing mix, which are people, process and physical existence.

What is an example of service mix? ›

These providers form the people of the service marketing mix. For example, the chef in the restaurant, a banker in the bank, an air hostess in the flight, etc. Companies spend much time in selecting and training their staff and every other person who represents the company to the customer.

How important is 7Ps marketing mix as a strategies applied in business? ›

Importance Of 7 Ps Of Marketing

The 7Ps model helps us to: Set objectives and provide a roadmap for your business objectives. Conduct SWOT analysis, and undertake competitive analysis. Review and define key issues that affect the marketing of its products and services.

What is the most important element in a service marketing mix? ›

Pricing is the most important element of your marketing mix. The price you set for a product or service will significantly influence your potential customers' choice to purchase it. Pricing will also affect consumer confidence in the benefits your product or service provides.

What is the concept of service mix? ›

Service marketing mix consists of different elements of service marketing that is used by companies for communicating organisational and brand objectives to the customers. The elements of the service marketing mix consist of: Product. Pricing. Place.

What are the 4 Ps of service design? ›

The 4 Ps of Service Design

People. Products. Partners. Processes.

When it comes to service sector the 4 Ps of marketing become 7Ps What are the added elements? ›

The 4Ps vs The 7Ps

Over time, Booms and Pitner added three extended 'service mix P's': Participants, Physical evidence, and Processes.

What is the marketing mix for a service? ›

Traditional marketing mix elements are composed of product, price, place, and promotion. These 4Ps also apply to service organizations. However, in addition to the traditional four Ps, the services-marketing mix includes three more factors: people, physical evidence, and process.

How many P's are there in the marketing mix of services? ›

The 7 Ps of marketing. Marketing is delivered through a combination of elements—the 'marketing mix'. These elements are also often referred to as the 7 Ps of marketing.

What are the 3 P's concepts? ›

The 3Ps of sustainability are a well-known and accepted business concept. The Ps refer to People, Planet, and Profit, also often referred to as the triple bottom line. Sustainability has the role of protecting and maximising the benefit of the 3Ps.

Is one of the P's of service marketing mix? ›

The 7 Ps of service marketing are product, price, promotion, place, people, process, and physical evidence. These seven elements will facilitate in enhancing customer satisfaction and increasing brand awareness.

What are the characteristics of service marketing mix? ›

Here are some of the main characteristics of services.
  • Intangible. Unlike tangible products, a service cannot be seen or felt before purchase. ...
  • Variable. ...
  • Perishable. ...
  • No Ownership. ...
  • Inseparable. ...
  • Interactive Marketing. ...
  • Internal Marketing. ...
  • External Marketing.
Aug 24, 2022

What is the significance of people in service mix? ›

People are the most important element of any service or experience. Services tend to be produced and consumed at the same moment, and aspects of the customer experience are altered to meet the individual needs of the person consuming it.

What is the 3p approach to quality? ›

Process, product and people are the three key elements of a company's quality system and all of them need to be focused on for an overall improvement in performance.


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