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Coty Inc. chief executive officer Michele Scannavini eloquently eulogized the long-held marketing principle of the four Ps during his dinner presentation at the WWD Beauty CEO Summit.
He recounted that the four Ps — product, price, place and promotion — represented a period in which everything was physical, including the product, the price tag, the store shelf and the store itself.
“If you wanted to compare prices, you had to go and walk into another store to make a comparison. So clearly transparency was very limited and control was pretty easy,” said Scannavini.
Trouble for the four Ps began to surface 15 years ago, he recalled, with the advent of the digital era. “It was a revolution,” said Scannavini, and with the rise of Millennials, or Generation Y, it was soon clear the four Ps theory was doomed.
See Complete Coverage of the WWD Beauty CEO Summit Here >>
“We are no longer talking to an obedient audience that we can influence with big investment in mass media, that we can channel to the store that we want, buy the product that we like at the price that we command. It’s over. It’s no longer like that,” he said. “Today, the environment is made by millions or billions of one-to-one conversations amongst peers.…With the exception of the Amazon forest, Central Africa, Siberia, Western China and Nepal, the rest of the world is constantly connected, creating and shaping an unbelievable, powerful digital interconnection.”
To underscore the point, Scannavini said that every minute 100 hours of new content is posted to YouTube “that billions of people can access freely without any possibility of control.” He later added, “For a winning company, it’s no longer enough to develop products that people want to use. Today, the challenge and the name of the game is to provide content that people want to share.”
This new reality has given rise to what Scannavini dubbed the four Cs — content, cocreation, convenience and curated environment. During his talk, he examined each one:
• Content: The creation of great content begins by listening to the customer, in part by monitoring conversations on social networks where Millennials are abundant.
• Cocreation: This approach includes incorporating customer feedback and storytelling. Scannavini said he likes to challenge his marketing team to tell the brand story in 30 seconds.
• Convenience: He noted that 75 percent of all Millennials browse online before buying in a store, and 97 percent say the most powerful retention tool for a retailer today is price and promotion. “We cannot lie, we cannot cheat.”
• Curated environment: Millennials want to buy where they want and what they want. “They are expecting an experience that is tailor-made to them.”
Scannavini said, “The big change is that you have to put yourself at the same level of your customer. You have to talk the same language. You have to be perceived genuine and authentic. You need to create empathy, and this you can only do if you really listen to them.”