3P Elasticity:

3P Elasticity:

 All marketing mangers have trends and plans about the price elasticity of a product. But do they think of product or place or promotion elasticity. I am sure they thing but it isn’t much of a consideration for there plans since price is the factor which produces the maximum elasticity. 

We will have a look at these three types of elasticity and can it be measured. 

PRODUCT ELASTICITY: 

Changes in physical type i.e. Style, Colour, Shape, and Form: these cosmetic changes are influencers for buying FMCG products, cars and white goods and other consumer goods 

Changes in features: this is a major influencer in cars and white goods because features differentiate the products of different brands 

Technology changes it is of influence for technology products. Changes are successful if the early adopters are satisfied with the changes 

These changes can be due to Innovation, Adaptation or Imitation by the manufacturer/ Service provider 

How can this elasticity measured by the company? Elasticity by a line-extension or brand extension can be measured. But if the product is an innovation, then it is not possible since the product will not have a precedent or history of sales to measure against 

PLACE ELASTICITY 

This is of prime importance for customers for whom convenience is the differentiator between competitors.

E.g. fast foods such as Pizzas, Burgers and restaurants who provide free home delivery residential areas near the restaurant’s vicinity

Should exclusive distribution be increased to selective distribution and selective distribution extended to intensive distribution? The factors needed to be considered apart from the cost, which I am assuming here, are going to be considerable.

Factors like the type of product, product life cycle; objective i.e. is it to have market share or profits maximization 

PROMOTION ELASTICITY

Should go all out and do promotions in all types of media? Or should it be selective media? Should it be continuous scheduling or flighting or pulsating? 

This depends on the objective to be achieved. Is it informing the customer or persuading or reminding?

Thus the elasticity impact is to be measured based on the scheduling and the types of media used. Different companies selling the same product will use different combinations of this. Elasticity impact can now be measured 

Sales promotion elasticity can easily be measured. 

Public Relations exercises are an unquantifiable promotion and there impact is not directly measurable. Thus its elasticity impact too cannot be measured. But PR is a continuous exercise since it is for the company as a whole and not for a specific product/ Service. So elasticity in this case need not be considered