Professor Koichi Shimizu's
From 4Ps to 4Cs
Before discussing about 7Cs Compass Model, inevitably we need to understand
the contents of 4Ps and 4Cs. Not matter whether the marketing model is
4Ps, 4Cs or 7Cs, it is not only for the academic research but also can
be effectively applied for the marketing management. A good model can be
applied for a long period even the outside environment has been changed.
However when the changes are too much and out of the expectation of its
inventor, the model needs to be entirely revamped to suite these changes.
In 1973, 4Cs is introduced at such background - from high-growth to low-growth
economics while 7Cs compass model introduced by Professor Koichi Shimizu
is to more precisely explain the essential factors of low-growth economics
From 7Ps to 7Cs
|Framework of 7Cs Compass Model
1. (C1) Corporation and C-O-S
The core of 4Cs is corporation (company and non profit organization) while the core of 4Ps is customer - they are the targets for the actions of the attack or defense. 4Ps look like customer-oriented however in reality, the decisions are made by the companies or corporations. Therefore the marketing activities of a company should be encircled by the consumers or citizens as the demanders to make the requests.
To avoid the misunderstanding, it is necessary to clarify the relationship between the consumers and the company, Just looking at the 7Cs compass, it may be misunderstood that the customers become less important because the "Customer" of the 4Ps core is moved to the outer chord and replaced by the "Company". In fact, the meaning to do it is just opposite - the consumers or customers play more important role. To arrange them on the figure like this is due to three reasons: 1) the company is encircled by the customers; 2) the company is the center to execute the marketing activities; 3) the company is encircled by the consumers instead of just the customers.
C-O-S (Competitor, Organization, Stakeholder) within the corporation.
The company has to think of compliance and accoutability as important. In the market, there are the companies of the same business, the competitors. Their activities cannot be ignored and they are also functioning as the individual systems of 7Cs compass so that the core can be seen as multiple. Stakeholder (stockholder and loyal user)
Why "Company" is put in the scope of 7Cs? The reasons are: 1) It is necessary to place more emphases on the organization of the companies; 2) It is necessary to execute marketing plans in conjunction with the company's objectives; 3) It is necessary to tackle the internal communication related problems like corporate communication or corporate identity system(CIS), etc.
2. Four Cs
(C2) Commodity, (C3)Cost , (C4) Communication and (C5)Channel
3. (C6) Consumer
Consumers are those people encircling the companies. Instead of just the customers of 4P marketing model, they are the ordinary citizens nurtured by the motto of the consumerism. However of course they are also including the customers and the potential customers.
We can then divide the consumers into two categories. The first one is the perspective customers and the second one is the other citizens who have the social relationships with the companies. The people of first category were the target of the marketing activities in the era of the high-growth economics. It is out of questions that in the era of consumerism, they still need to be explored to increase the market share. One the other hand, the companies now can not omit the people of second category even there is not sell and buy relationship with them. For example, the companies produce noises and trashes in the process of the production, which lead to the social problem. Since the word "Consumerism" was introduced from 1960s, the companies so far still sometimes ignore their benefits.
The factors related to the customers can be explained by the first characters of four directions marked on the compass: N = Needs, W = Wants, S = Security and E = Education.
a. Needs - analyze what the consumer needs. Needs is the unsubstantiated opinion, some of which cannot be converted to the concrete commodities. Companies can offer more alternatives to meet the various needs of the consumers;
b. Wants - the substantiated needs to expect the accordingly commodities. The companies need to place more emphasis on the biggest needs and not to omit the noiseless needs;
c. Security - the safety of the commodities, the safety of the production process and the adequate after-sell warranty;
d. Education - consumers right to know the information of the commodities;
4. (C7) Circumstances
Besides the customers, there are also various uncontrollable external environmental factors encircling the companies. The same as the factors of the consumers, they can also be explained the first character of the four directions marked on the compass - N = National and International,W=Weather, S = Social and Cultural, E = Economic.
a. National and International Circumstances
The National Circumstances are related to politic and law. Once an election finished, the combination of the politicians in the parliament may be changed and they may implement different policies. The most influential to the marketing decisions is economic policies, which directly related to the economic growth. There are also a dozen of laws to protect the consumers namely Consumer Contract Act, Consumer Protection Fundamental Act and Product Liability Act. The companies have no other choices but to follow these laws or they will face the endless lawsuits.
International environment now also becomes important. In the very near future, no one single country can form an independent society. It is a must to establish the international cooperation mechanism for solving the problems like international law, energy, military and trade etc.
Despite the advance of the human technology, the weather and natural environment is still uncontrollable. For most of the natural disasters, the companies can do little but try to predict when they will happen and adjust the marketing plans. However more can be done to avoid the disasters caused by human like the environment pollution.
c. Social and Cultural Circumstances
Social Circumstance is related to the social system and problems of a nation. When exploring a new oversea market, it is essential to study the social circumstances of that nation. Moreover marketing analysis should include following human cultural factors:
1) basic values and attitudes
3) learning capacity and achievement orientation
4) technical know-how
5) social discipline
6) sense of responsibility for the common good and the community
7) capacity for flexible adaptation to a changing environment
d. Economic Circumstances
Economic Circumstances is closely related to National Circumstances we have discussed before however economics climate is changing due to many other uncontrollable factors like energy, resources, international income and expense, financial circumstances and economic growth etc. For example, the whole organization structure for marketing needs to be adjusted from 4Ps to 4Cs or 7Cs model when the economics is changed from high-growth to low-growth.
McCarthy, Jerome E. (1964). Basic Marketing. A Managerial Approach. Homewood, IL: Irwin.
Kotler, P. and Keller, K. (2006), Marketing Management, Pearson Prentice Hall, Upper Saddle River, NJ, USA.
Lauterborn, R. (1990). New Marketing Litany: Four Ps Passé: C-Words Take Over. Advertising Age, 61(41), 26.
Schultz, Don E; Tannenbaum, Stanley I; Lauterborn, Robert F (1993), Integrated marketing communications, NTC Business Books, ISBN 978-0-8442-3363-5
Shimizu, Koichi(1989) "Advertising Theory and Strategies," (Japanese) first edition, Souseisha Book Company in Tokyo. pp.63-102.
Shimizu, Koichi (2014) "Advertising Theory and Strategies,"(Japanese) 18th edition, Souseisha Book Company (ISBN4-7944-2132-X C3034) pp.63-102.
Shimizu, Koichi (2016)"Symbiotic Marketing Strategis,"(Japanese) 5th edition, Souseisha Book Company (ISBN978-4-7944-2482-2 C3034) pp.25-62.
Solis, Brian (2011) Engage!: The Complete Guide for Brands and Businesses to Build, Cultivate, and Measure Success in the New Web, John Wiley & Sons, Inc. pp. 201-202.
McCarthy, Jerome E. (1975)"Basic Marketing: A Managerial Approach," fifth edition, Richard D. Irwin, Inc., p. 37.
Professor Koichi Shimizu: Professor of Advertising, Josai University Graduate School of Business Administration,
Department of Business Administration (Japan)
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