Sky has begun rolling out their beefed up ‘Sky Ultimate TV’ package – demonstrating how product improvement can hold its own against new product launches
The four Ps of marketing – product, price, place, promotion – are the tactical foundations of our world.
But as a marketer, can you – hand on heart – say you routinely consider all of them? Are some of the Ps more loved than others?
Promotion (or marketing communications, as many marketers would call it today) commonly gets most attention. That’s understandable, isn’t it? Creating campaigns, making channel choices, allocating budget, taking a view on long vs short – who can blame the marketer who decides this is the P they can best control and use to drive results?
It’s not the most important P though. The P we should focus on, as Mark Ritson explains on the MiniMBA in Marketing, is product: “Without a good product, no matter how good everything else might be, you’re not going to be successful.”
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Yet, worryingly, a new study from Ipsos has revealed that more than 30% of marketing professionals couldn’t correctly identify ‘product’ as part of the 4Ps.
As marketers, we shouldn’t expect that we can control product – we typically don’t own it – but we can influence it. And we should.
Sky fights product with product
Wherever you are in the world, there’s a good chance there’s a local television operator currently demonstrating why marketers mustn’t forget about the product P.
These companies are commonly facing price-sensitive consumers, a growing preference for streamed content and thriving, well-funded competitors like Netflix. For these companies, product is a powerful differentiator.
For these companies, product is a powerful differentiator
That goes some way to explain why Sky, the UK pay-TV operator, has announced it will this year wrap four high-profile streaming services – Netflix, Disney+, HBO Max and Hayu – into its headline TV package, so customers can access everything in one place, with one charge and minimal effort.
According to UK media regulator Ofcom, streaming services are increasingly the first place viewers head when they switch on their TV – especially among younger audiences (13-24s), who prefer Netflix (35%) and YouTube (31%) to traditional linear TV.
Sky wants to become that ‘first click’ for subscribers – the place they start their viewing when they sit down and switch on their TVs.
Dana Strong, Sky’s CEO, talked about this at an industry event in 2023, noting that the broad range of players in this space – and the multiple routes to content – made it time-consuming for viewers to find content they wanted to watch. But by acting as a gateway to content, Sky is seeking to reduce the time it takes viewers to find great content – or reduce the “speed to joy.”
Research from Deloitte in the US supports this strategy, finding that streaming subscribers report “fatigue with having to manage multiple subscriptions to get the content they want.”
For Sky, it also reduces the threat from new streaming services like HBO Max, which launched in the UK last week – carrying content previously exclusive to Sky.
The Last of Us (HBO), previously exclusive to Sky for UK viewers
Sky is just the latest of many media companies to opt for this approach to ‘bundle’ services together. Audience needs and wants are changing – and being met elsewhere. Sky’s choice was to accept the risk of disruption to its traditional pay-TV and growing streaming business, or to embrace the big streaming brands. The conclusion seems to have been that pulling other tactical levers, such as focusing on more effective marketing communications, wouldn't win in these market conditions.
Sky’s move is a good illustration of what product development often really looks like
Sky’s move is also a good illustration of what product development often really looks like. While it’s tempting to think of product as an opportunity to create something new, more often than not, product investment is in existing product improvement.
And as Mark Ritson teaches on the MiniMBA in Marketing, this is a space that all marketers should want to play in. While marketing may not ‘own’ product anymore, we are particularly well-placed to influence how it evolves, because knowing the customer is the most important part of the job.
When there’s a gap between the proposition and the needs and wants of those customers, that’s an opportunity for marketing to step up.
It’s easy enough to say that marketers should be influencing product, but how should we best approach that?
What we shouldn’t do is take a piecemeal approach: a small suggestion here, a quick change there. As marketers, we need to take a much more strategic approach, informed not by our gut feel but by the input of customers. By mapping out the customer touchpoints and gauging how well our product is doing at each stage of the customer journey, we can be clear on where there’s most scope for improvement.
The MiniMBA in Marketing also introduces the Jobs to Be Done framework – an approach that focuses on identifying what ‘job’ the customer wants the product to fulfil. Sky’s focus on "reducing the time it takes a subscriber to find content they like" is a clear example of a job to be done.
This is how marketing can demonstrate its strength in product conversations: bringing the voice of the customer into the foreground.
What about the other Ps?
For Sky, this is also about the pricing P. The new product is better value for money. The bundled proposition allows the company to offer a saving to customers that might otherwise take each service individually, allowing Sky to defensibly frame its pricing as “the best value in the market.”
There’s another P at play here too, but not for Sky. For the streaming companies, this is about place.
Netflix, Disney+, HBO Max and Hayu gain an additional channel of distribution through Sky – an easy way to reach the millions of customers that don’t already subscribe to their service. This matters when we consider that the TV streaming subscription market in the UK has plateaued in recent years.
The additional channel of distribution is also likely to leave them less vulnerable to customer churn, a particular problem they’re facing as customers habitually churn then return to catch the series they really care about. For the streaming companies, that feels like a big win.
The launch will also, inevitably, be accompanied by product launch campaigns and well-funded communications strategies, capping off our four Ps.
Working on the product P doesn’t have to mean ground-breaking change
Working on the product P doesn’t have to mean ground-breaking change. But when aligned with the other three Ps, even small product improvements have the potential to deliver meaningful impact. When you’re next thinking about the marketing mix, don’t underestimate the power of product.
If you’d like to explore how you can make more of the product P (and the other Ps too), the right training can help.
Join Mark Ritson on the MiniMBA in Marketing and you’ll learn how to make the four elements of the marketing mix work for your plans. The next course starts in April – secure your place here.
Interested in Team Training? Join Specsavers, Google, Adidas, Yakult and more – a global network of leading brands who are already training with MiniMBA. Contact our training team to find out more.
Cover: The Last of Us (HBO) on Sky