Marketing in business is the task of finding and stimulating buyers for a firms's output. Product development, pricing, distribution, and communication are the mainstays of marketing, while progressive firms also develop new products and chart the trends and changes in people's needs and desires. Marketing can either apply its knowledge to social problems and organizations or remain in a narrowly defined business activity. Every organization has basically the same functions: personnel management, production, income, and promotion, which are using modern marketing skills in commercial sectors. Suppliers and consumers are needed by all organizations. In Canada a group wished to promote an antismoking campaign but they had little money compared to the tobacco companies. This group used modern marketing techniques to combat their lack of funds and found many ways, e.g., books, articles. A business firm uses a multitude of marketing tools to sell its product. Nonbusiness organizations frequently do not integrate their programs the way the businesses place all activities under one marketing vice president and department. Astute marketing depends on continuous feedback from consumers and suppliers. They are dependent upon up-to-the-minute research that tells them about changes in the environment and moves of competitors. Nonbusiness organizations are often casual about the research upon which they base their vital decisions.
Marketing tools, techniques, and theories developed in the private sector can be applied in the public and nonprofit sectors; however, their limitations must be recognized. Nonbusiness communications campaigns should consider the involvedness (high or low) of the situation and the relevant segments, available positive and negative reinforcers, nonmonetary costs, the level of latent demand, and the wide range of communications alternatives. 5 hypotheses can be proposed regarding communications effectiveness outside of the private sector: 1) the lower the perceived personal value to the individual, relative to the cost, the more difficult the behavior change task and the lower the likelihood of success of marketing communications; 2) the lower the latent or pre-existing demand for the object, the more difficult the behavior change task and the lower the likelihood of marketing communications success; 3) the greater the involvement level of the object, situation, or issue, the more difficult the behavior change task and the lower the likelihood of marketing success; 4) the greater the past involvement level of the individual, the more difficult the behavior change task and the lower the likelihood of success; and 5) the greater the level of participation needed within the society, the more difficult the behavior change and the lower the likelihood of sucess of marketing communications. Many nonbusiness issues exist in either very high or very low involvement environments, calling for an enlarged set of communications strategies. More attention should be given to communications alternatives such as movies, television programs, and in-home and in-school educational communications, especially since it appears that public service spots are not very effective. Finally, more research is needed to generate and test the effectiveness of various marketing strategies aimed at overcoming inherent characteristics that suggest a low likelihood of success.
Social marketing, the application of marketing thinking and tools to the promotion of social causes, has proved successful in effectively promoting beneficial social change, and is expected to grow in scope, scale, and effectiveness. It has evolved through social advertising and social communication, and is increasingly employed by a growing number or organizations and government agencies. Increasingly, social communication and marketing are being added to social advertising. Family planning, heart disease prevention, and other health cases are cited as examples of the range and impact of social marketing applications. As advances in conceptualizing social marketing problems and evaluating the impacts of social marketing programs make them more effective, social marketing specialists should be expected to work on a wider range of social causes with increasing sophistication. The evaluation of social marketing is discussed. Situations calling for social marketing are also explored, program accomplishments outlined, and criticisms and obstacles examined.
This article reviews the problems that arise when general marketing principles are applied to social programs. Social marketing is conceptualized as the design, implementation, and control of programs seeking to increase the acceptability of a social ideal or practice in a target group. These problems can occur in 8 basic decision-making areas: market analysis, market segmentation, product strategy development, pricing strategy development, channel strategy development, communications strategy development, organizational design and planning, and evaluation. Social marketers find that they have less good secondary data about their consumers, more problems obtaining valid and reliable measures of relevant variables, more difficulty sorting out the relative influence of determinants of consumer behavior, and more problems getting consumer research funded than marketers in the commercial sector. They tend to have less flexibility in shaping their products and more difficulty formulating product concepts. Problems associated with establishing, utilizing, and controlling distribution channels comprise another major difference between social and more conventional forms of marketing. Social marketers also find that their communications options are somewhat limited as a result of problems associated with use of paid advertisements, pressures not to use certain types of appeals in their messages, and the need to communicate large amounts of information in their messages. Moreover, social marketers must function in organizations where marketing activities are poorly understood, underappreciated, and inappropriately located. Finally, they face problems trying to define effectiveness measures or estimating the contribution their program has made toward the achievement of certain objectives. If all these problems are anticipated and handled creatively, social marketing efforts can succeed.
The authors explore social marketing applications in the Louisiana model of statewide program for family planning. The marketing concept has 4 major elements: 1) consumer orientation; 2) social process; 3) integrated effort; 4) profitable operation. Success of program and continued growth are the results of defining services needed by consumer; determining market target; taking services to customer; and emphasizing concept of selling family planning rather than giving free birth control method. Another important facet is the recognition of many participants--community agencies, the church, the American Medical Association, funding sources, and hospitals. This project used anyaltical marketing tools and defined services as human services rather than the narrow family planning services. It also extended activities to multinational environment and adapted the product offering to meet these needs.
This article examines the applicability of marketing concepts to social causes and social change. Social marketing is defined as the design, implementation, and control of programs calculated to influence the acceptability of social ideas and involving considerations of product planning, pricing, communication, distribution and marketing research. Wiebe examined four social advertising campaigns and concluded that their effectiveness depended on the presence of adequate force, direction, adequate and compatible social mechanism, and distance (the "cost" of the new attitude as seen by message's message"s recepient). A marketing planning approach is not a guarantee for the achievement of social objectives; yet, it represents a bridging mechanism linking the knowledge of the behavioral scientist with the socially useful implementation of that knowledge.
Focus is on social marketing in a health context, and attention is directed to the development of a psychosocial model of health-related behavior with emphasis on developing countries. Each component of the model is identified and defined, with some of the interactions among its components noted. There are both advantages and limitations to using the model in a social marketing context. The model's primary contribution at this stage of its development is in structuring and organizing diverse sources of knowledge and data. New relationships are suggested which were not previously considered in the literature. The relationship between risk-taking and perceived susceptibility is 1 example. The model also provides a basis for simulating health processes, providing a testing ground for health policies before their actual implementation. The model's perspective is uniquely appropriate for the development of social marketing strategies, and it promises to encompass health market behavior in various cultural settings.
There are many elements in population programs that are more familiar to marketing men than to some population experts. Advertising is essential to reach the target population, and advertising evaluation techniques (e.g., surrogate indexes or audience measures) might be useful for evaluating both population information activities and the import of the entire program. Fundamental research on basid demand for fertility control is needed and a marketer's experience with planning and evaluating test markets can be useful in assessing potential selling targets and evaluating alternative promotional and distributional strategies. Special family planning clinics have certain disadvantages: expensive and scarce personnel are needed; red tape may be present; the network is based on the assumption that the client is willing to travel relatively great distances repeatedly; and clinics lack anonymity which may scare potential acceptors away. Most developing cultures have an intensively functioning distribution structure which delivers basic commodities to the most remote areas, providing relatively anonymous outlets that are physically close to the customs. Materials requiring a prescription might be distributed in exchange for script issued at and ultimately redeemed by clinics, this requiring only an occasional visit to a clinic. Mail-order service can be used to supplement a clinic's distribution of some contraceptives. It should be remembered that population administrators often have an antipathetic view toward business and marketing and "suspect" the profit motive.
Using two different samples of salespeople, the authors investigate how a combination of general mental ability (GMA) and specific skills and capabilities (social competence and thinking styles) allows salespeople to reach their sales goals. The study finds evidence for an interaction between GMA and social competence. If combined with high social competence, high GMA leads to highest sales performance; if combined with low social competence, high GMA leads to lowest sales performance. In addition, interaction effects between GMA and a judicial thinking style were found. Salespeople high on GMA have the most potential for attaining high levels of sales performance when combined with specific skills; when lacking these skills they may become the firmâ€™s worst performers.
The study investigates the effects of direct and mass marketing communications on the adoption timing of a new e-service among existing customers. The mass marketing communications concern both specific new service advertising and brand advertising from both the focal supplier and competitors. Using a split-hazard approach, the authors account for the fact that a significant part of the customer base will never adopt the new e-service. The empirical results show that service advertising shortens the time to adoption, even when it is initiated by competitors.
How can a potential user distinguish between a quantitative model that may be of some real value and one that is not? The model builder rarely provides much help, since most are advocates of their own work and tend to lose their objectivity toward the model. Therefore, an independent evaluation is necessary to judge the true usefulness of the model.
Why do some articles become building blocks for future scholars, while many others remain unnoticed? We aim to answer this question by contrasting, synthesizing and simultaneously testing three scientometric perspectives â€“ universalism, social constructivism and presentation â€“ on the influence of article and author characteristics on article citations. To do so, we study all articles published in a sample of five major journals in marketing from 1990 to 2002 that are central to the discipline. We count the number of citations each of these articles has received and regress this count on an extensive set of characteristics of the article (i.e. article quality, article domain, title length, the use of attention grabbers and expositional clarity), and the author (i.e. author visibility and author personal promotion). We find that the number of citations an article in the marketing discipline receives, depends upon â€œwhat one saysâ€ (quality and domain), on â€œwho says itâ€ (author visibility and personal promotion) and not so much on â€œhow one says itâ€ (title length, the use of attention grabbers, and expositional clarity). Our insights contribute to the marketing literature and are relevant to scientific stakeholders, such as the management of scientific journals and individual academic scholars, as they strive to maximize citations. They are also relevant to marketing practitioners. They inform practitioners on characteristics of the academic journals in marketing and their relevance to decisions they face. On the other hand, they also raise challenges towards making our journals accessible and relevant to marketing practitioners: (1) authors visible to academics are not necessarily visible to practitioners; (2) the readability of an article may hurt academic credibility and impact, while it may be instrumental in influencing practitioners; (3) it remains questionable whether articles that academics assess to be of high quality are also managerially relevant.
This study uses Markowitz mean-variance portfolio theory with forecasted data for the years 2005 to 2035 to determine efficient electricity generating technology mixes for Switzerland. The SURE procedure has been applied to filter out the systematic components of the covariance matrix. Results indicate that risk-averse electricity users in 2035 gain in terms of higher expected return, less risk, more security of supply and a higher return-to-risk ratio compared to 2000 by adopting a feasible minimum variance (MV) technology mix containing 28 percent Gas, 20 percent Run of river, 13 percent Storage hydro, 9 percent Nuclear, and 5 percent each of Solar, Smallhydro, Wind, Biomass, Incineration, and Biogas respectively. However, this mix comes at the cost of higher CO2 emissions.
Trade shows are a multi-billion dollar business in the US and the UK, but little is known about the determinants of trade show effectiveness. In this paper, we build a model that explains differences in trade show effectiveness across industries, across companies and across two countries. We focus on the differences in trade show effectiveness measured in a similar way across similar samples of 171 US and 135 UK firm-show experiences between 1980 and 1991. While the similarities outweigh the differences, we find evidence that trade shows are viewed differently by exhibitors and attendees in these two countries. We are able to make substantial generalizations about the effect of various show selection (go-not go) variables (booth size, personnel, etc.) on observed performance. We discuss the implications of our research for developing benchmarks for trade show performance and for better global management of the business marketing communications mix.
The authors illustrate how a firm can face the challenge of forecasting consumer reaction for a really-new product. For the case of an electric vehicle, the authors describe how one firm combines managerial judgment and state-of-the-art market measurement to determine whether (1) the really-new product would be a viable business venture at its target launch date, (2) the firm should plan for improvements in technology that would reduce price and/or increase benefits enough so that the business venture would be profitable, or (3) the firm should stop development. The new market measurement system combines existing methods with a multimedia virtual-buying environment that conditions respondents for future situations, simulates user experience, and encourages consumers to actively search for information on the product. The authors comment on the advantages and disadvantages of the methodology and summarize the lessons they have learned from this application.
Systems are composed of complementary products (e.g., video game systems are composed of the video game console and video games). Prior literature on indirect network effects argues that, in system markets, sales of the primary product (often referred to as "hardware") largely depend on the availability of complementary products (often referred to as "software"). Mathematical and empirical analyses have almost exclusively operationalized software availability as software quantity. However, while not substantiated with empirical evidence, case illustrations show that certain â€œsuperstarâ€ software titles of very high quality (e.g., Super Mario 64) may have had disproportionately large effects on hardware unit sales (e.g., Nintendo N64 console sales). In the context of the U.S. home video game console market, we show that the introduction of a superstar increases video game console sales on average by 14%, over a period of 5 months. Software type does not consistently alter this effect. Our findings imply that scholars who study the relationship between software availability and hardware sales, need to account for superstar returns, and their decaying effect over time, over and above a mere software quantity effect. Hardware firms should maintain a steady flow of superstar introductions, as the positive effect of a superstar only lasts for 5 months, and make, if need be, side-payments to software firms, as superstars dramatically increase hardware sales. Obtaining exclusivity over superstars, by hardware firms, does not provide an extra boost to their own sales, but it does take away an opportunity for competing systems to increase their sales.
Indirect network effects are of prime interest to marketers because they affect the growth and takeoff of software availability for, and hardware sales of, a new product. While prior work on indirect network effects in the economics and marketing literature is valuable, these literatures show two main shortcomings. First, empirical analysis of indirect network effects is rare. Second, in contrast to the importance the prior literature credits to the chicken-and-egg paradox in these markets, the temporal pattern â€“ which leads which? â€“ of indirect network effects remains unstudied. Based on empirical evidence of nine markets, this study shows, among others, that: (1) indirect network effects, as commonly operationalized by prior literature, are weaker than expected from prior literature; (2) in most markets we examined, hardware sales leads software availability, while the reverse almost never happens, contradicting existing beliefs. These findings are supported by multiple methods, such as takeoff and time series analyses, and fit with the histories of the markets we studied. The findings have important implications for academia, public policy and management practice. To academia, it identifies a need for new, and more relevant, conceptualizations of indirect network effects. To public policy, it questions the need for intervention in network markets. To management practice, it downplays the importance of the availability of a large library of software for hardware technology to be successful.
"Pop internationalists" -- people who speak impressively about international trade while ignoring basic economics and misusing economic figures are the target of this collection of Paul Krugman's most recent essays. In the clear, readable, entertaining style that brought acclaim for his best-selling Age of Diminished Expectations, Krugman explains what real economic analysis is. He discusses economic terms and measurements, like "value-added" and GDP, in simple language so that readers can understand how pop internationalists distort, and sometimes contradict, the most basic truths about world trade.
A prevailing view of the effects of brand advertising is that it raises prices by increasing the costs of manufacturers and by reducing the elasticity of demand they face, thus raising the advertising manufacturer’s price. However, by increasing a brand’s rate of turnover, its manufacturer often obtains scale economies that offset, at least partially, the tendency to raise price.While conceding that brand advertising may nevertheless raise manufacturers’ prices, the article demonstrates that it can lower consumer prices by reducing the margins in distribution in 2 ways. 1) By increasing a brand’s rate of turnover, reducing the costs of wholesalers and retailers. 2) By creating product identity, the ability of consumers readily to recognize a famous brand as the same item wherever it is sold, which strongly disciplines retailers’ markups.Within an advertised category the thin distribution margins of the advertised brands force down the margins of unadvertised brands which will be lower than in unadvertised categories. Evidence of the effects of advertising is taken from the toy industry in the U.S. (and Canada). In the U.S., the advent of TV advertising to children beginning in the late 1950’s, lowered consumer prices and greatly increased output. Research in other industries is required to validate the generality of these conclusions. But the proper question must be what happens to the prices consumers pay, not what happens to manufacturers’ prices, as is the common research approach, for even if manufacturer’s prices rise, consumer prices may fall.
This research evaluates the effect of customer relationship management (CRM) on customer knowledge and customer satisfaction. An analysis of archival data for a cross-section of U.S. firms shows that the use of CRM applications is positively associated with improved customer knowledge and improved customer satisfaction. This article also shows that gains in customer knowledge are enhanced when firms share their customer-related information with their supply chain partners.
In a series of 8 surveys during a 5-year period, preferences were determined by the hedonic scale method for about 400 dishes. Respondents were probability samples of Army enlisted men. Tables present preference data for 11 food classes, and also show significant relationships of preference to background characteristics of the respondents. The following topics are discussed: methods, characteristics of the respondents, quantification of the data, reproducibility, validity of preference for predicting food behavior, analysis of preference by individual dishes and food classes, and relation of preference to respondent characteristics. (PsycINFO Database Record (c) 2012 APA, all rights reserved)
This book on the wording of questions in opinion and market research deals with the importance of asking good questions, the dangers of assuming too much knowledge or understanding on the part of respondents and the considerations in designing free-answer, 2-way, multiple-choice, and other types of questions. Additional chapters deal with wording questions to maximize rapport with respondents, the need for brevity and simplicity, a list of 1000 well-known words, words that cause difficulty of various kinds, ways of avoiding weighted questions, punctuation, phonetics and abbreviations, and a full account of the development of a passable question. The final chapter presents a concise check-list of 100 considerations in question wording. 53 references. (PsycINFO Database Record (c) 2012 APA, all rights reserved)
The effects of market orientation and entrepreneurial inclination on business performance is examined with the use of a theoretical model that envisions market orientation as a firm's activities related to intelligence gathering and responsiveness. It further considers market orientation as both a consequence of a phenomenon of entrepreneurial inclination and a systematic safeguard against the tendency to take unnecessary risk. Taking a purposeful enactment perspective, the organization's entrepreneurial inclination is considered as an introduction as to how the organization is designed and structured to achieve the expected outcomes when facing new business opportunities. Data are collected from 364 U.S. manufacturing companies Results indicate that: (1) entrepreneurial inclination's positive effect on performance measures is indirect but is achieved only through a market orientation; and (2) entrepreneurial proclivity's direct performance effect is negative on return on investment.(JSD)
This paper addresses the role of marketing in hypermedia computer-mediated environments (CMEs). Our approach considers hypermedia CMEs to be large-scale (i.e. national or global) networked environments, of which the World Wide Web on the Internet is the first and current global implementation. We introduce marketers to this revolutionary new medium, propose a structural model of consumer behavior in a CME that incorporates the notion of flow, and examine the set of consequent testable research propositions and marketing implications that follow from the model. Marketing in Hypermedia Computer-Mediated Environments: Conceptual Foundations 1) Introduction Firms communicate with their customers through various media. Traditionally, these media follow a passive one-to-many communication model whereby a firm reaches many current and potential customers, segmented or not, through marketing efforts that allow only limited forms of feedback on the part of the customer. For several years no...
Presents a theoretical discussion of the puzzling relation, or lack of it, between income and happiness. Where the economist sees satisfaction as the supplying of consumer needs, the psychologists recognizes a wider and more complex system of need. These theoretical considerations are discussed as they apply in detail to the American scene. (PsycINFO Database Record (c) 2012 APA, all rights reserved)
An emerging consensus in marketing is that consumers respond to price relative to some standard or reference price. Most researchers modeling brand choice have reasoned that this standard is based on past prices of the brand. The authors argue that consumers do use reference prices, but one that is also based on context- other prices in the store-rather than on past prices alone. An analysis of households' brand choices in two subcategories and over three cities support this premise. Within context, the lowest price seems to be an important cue for reference price, whereas within time, a brand's own past prices seem to be the most important cue. Households' use of a contextual reference price also varies predictably across some consumer characteristics. Though their model can be applied to other categories, the findings have important managerial implications: Managerial focus on temporal reference prices could lead to an everyday high price, whereas focus on contextual reference prices could lead to an everyday low price. Only the inclusion of both contextual and temporal reference prices justifies variable pricing.
Examined the effect of selected contextual variables on the degree of formal development of the product elimination process and the role that formality plays in that process. Individuals from 94 British engineering companies who had overall knowledge of their company's operations and product elimination efforts participated in the study. Results show that formality was negatively correlated with the duration of the product elimination decision-making process. These results contradict previous research in this area. (45 ref) (PsycINFO Database Record (c) 2012 APA, all rights reserved)
Discusses whether marketing can fulfill the opportunities available and the demands made upon it while concentrating on the limited scope of its domain. As a discipline, it has been repeatedly redefined between the contending poles of theory and practice, specialization and generalization, established interests and global expectations. Currently, the discipline emphasizes management strategies, consumer behavior, and quantifiable modeling. (2 ref) (PsycINFO Database Record (c) 2012 APA, all rights reserved)
Mailed a service satisfaction questionnaire to 200 customers of a marina in northern New England. As part of the study, 3 ways to increase response were tested: (a) personalization (hand-written envelope address and letter salutation), (b) use of commemorative stamps for postage, and (c) the signatory of the cover letter (some were signed by the owner of the marina, and some by the service manager). Only the signatory variable made a significant difference in return rate. (PsycINFO Database Record (c) 2012 APA, all rights reserved)
This book is designed to be a text, and aims to present the principles and procedures of creative thinking. The author claims that study of the general principles of creation and the methods used by famous creators can help a person do his own creating. There are 26 chapters, covering a wide variety of topics, such as "imagination in marital relations," "the age factor in creativity," "ways by which creativity can be developed," "factors that tend to cramp creativity," "the element of luck in creative conquests," "the value of thinking up plenty of hypotheses," "the effect of emotional drives on ideation," "creative collaboration by teams," and many others. (PsycINFO Database Record (c) 2012 APA, all rights reserved)
Analyzed the response to 1,400 questionnaires mailed to the membership of the American Society for Public Administration. A deadline in the questionnaire cover letters had no positive effect on response rate. A cover letter on the Association's letterhead, signed by a well-known individual, resulted in a slightly larger response than a cover letter on university stationery, signed by a less well-known individual. Use of commemorative postage stamps was less effective than the use of postage meters. (PsycINFO Database Record (c) 2012 APA, all rights reserved)
Since the time of Plato and before society has honored those who build better mousetraps but suspected those who market mousetraps better. A utility, in classic economics is the ability to satisfy a human want. The territory of marketing encompasses 3 of the 4 utilities – time, place and possession that are performed by wholesale and retail establishment, transportation firms, advertising agencies and other service industries. Form utility, the 4th. utility, occurs in agriculture, extraction and manufacturing. The prejudice against marketing denigrates the 3 marketing utilities and magnifies the importance of form utility. It rubs off against individuals engaged in marketing endeavors as less worthwhile than the honest farmer, the toiling production line worker and the bold captain of basic industry, Plato characterized a city of shopkeepers as "unfriendly and unfaithful" and scornfully assigns the tasks of storekeeper and salesmen to those who are "the weakest in bodily strength and therefore of little use for any other purpose." Aristotle ordered economic pursuits into a hierarchy of worthiness with the form utility occupations of agriculture and handicrafts at the top. All forms of trade are less desirable and retailing is unnatural and base. By the fall of the Roman empire, it had been well established that farmers and craftsmen wee noble and strong and added utility while merchants were weak and slippery and marketing added costs but not value. Medieval writers also adopted these conclusions. So the anti-marketing bias found its way into both Marxist and mainstream western thinking, including the writings of Arnold Toynbee and Thorstein Veblen. The prejudice is clear in the British Labour Party’s Selective Employment Tax whose purpose was to drive workers from "unproductive" trade and service occupations to "productive" form utility jobs and in the early attempts of the Soviet Union to eliminate both wholesaling and advertising.The balance of the article identifies the sources for the prejudice against marketing including the easier understanding of Form Utility Creation and the failure of economics to recognize the contributions of advertising and other non-form utility functions. A powerful additional cause has been the usefulness of the anti-marketing bias to justify anticompetitive restrictions against marketing practices that protected certain established business and professional groups. Since antiquity when the prejudice was first conscripted into the doctrinal service of the landed gentry, it has faithfully defended established elites against the latest crop of successful marketers.
Corporate Strategic Planning (CSP) reports on an important study of planning practices and the value of those practices. Though it is a long book, nearly 500 pages, one can get almost the full benefit by reading about 200 pages. In fact, CSP contains an excellent summary (Chapter 11) that is only 33 pages; this chapter should be sufficient for most readers. My review assesses what the book has to offer and provides a guide to the potential reader.
Although Rothenberg ostensibly reports events in an objective fashion, 'Where the Suckers Moon' nevertheless reads like an expose of incompetent management by the client and the agencies. By revealing the process used to select advertising agencies, Rothenberg provides a basis for discussion. Is this the process that is wanted? The agency's process, as described by Rothenberg, did not include all that an advertiser should expect. An alternative subtitle for the book might have been 'Advertising Agencies Don't Do Strategy'. The good news for Subaru and other companies is that the possibilities for improvement are exciting. Structured approaches have improved decision making in other areas of management, and they are likely to help in the selection of an agency. On the other hand, had Wieden and Kennedy used this approach, I doubt that Rothenberg would have been able to write such an interesting book about advertising.
The system for the design, production, and dissemination of marketing scholarship aimed at contributing to marketing practice is under increasing strain due to pressures exerted by globalization, digitization, and environmentalism. Scholarly research in marketing adheres largely to a twentieth-century manufacturing model. Change is needed now. Marketing scholarship can benefit from embracing a twenty-first-century, collaborative approach to the conception, design, and dissemination of research. “Crowdsourcing” is becoming a frequently employed strategy in industry. Marketing academe should adopt some of the same techniques and technologies to make stronger research contributions that will benefit marketing practice. In particular, more collaboration is needed, both among academic researchers and between academe and industry, to be sure important problems are being investigated using sound theories and methods. An open, collaborative model will allow the field to evolve from Marketing Scholarship 1.0 to Marketing Scholarship 2.0.
The strategic importance of Business-to-Business (B2B) relationships is well recognized, but their financial impact remains equivocal. This study links social capital from three types of B2B networks of young technology firms with their Initial Public Offering (IPO) value. The authors identify three relevant types of absorptive capacity that facilitate the transformation of B2B social capital into IPO value. For the transformation to occur, the authors find that young firms need not only the opportunity to access the resources provided by B2B relationships, but also the ability to leverage them through the complementary capability, namely, absorptive capacity. The hypotheses are tested on a sample of 177 IPOs and the results are robust to endogeneity concerns and alternative measures. As one of the first studies in marketing-finance interface to focus on young firms, the findings provide novel insights such as the deleterious financial consequence of having marketing and R&D B2B relationships without the relevant absorptive capacity. Managerial implications regarding communicating the value of absorptive capacity, disclosure of marketing related information, and the importance of marketing for young technology firms are also provided.
This second edition of the Age of Propaganda is excellent. (Should I explicitly tell you my conclusion?) I will use a two-sided argument to try to convince you to read this book. (Is a two-sided argument relevant in this situation and, if so, should I tell you the good news first or last?) I will reduce the asides in the rest of this review because are distracting (and distraction is not useful here, as the arguments to purchase this book are strong); suffice it to say that these are the types of issues that the authors address.
Institutional competition to retain and recruit marketing scholars capable of publishing in the leading marketing journals has intensified. While increased emphasis has been placed on publication productivity in the leading marketing journals, little is known as to questions such as: (1) What level of publication productivity in the leading marketing journals does it take to get promoted in marketing academia? (2) What level of publication productivity in the leading marketing journals warrants exception? and (3) What drives research productivity in the leading marketing journals? We draw on the economic concept of imperfect substitution to address these questions using two datasets: (1) a census of publication activity in the leading marketing journals of 337 scholars in the Top 70 institutions promoted between 1992-2006, and (2) an examination of 2,672 scholars publishing 3,492 articles in the four leading marketing journals over the period 1982-2006. The results indicate that the average number of publications by successful candidates for promotion to associate professor from Ph.D. conferral at Top 10 institutions was .57 articles in the leading marketing journals per year, compared to .47 in the Top 11-20 institutions, .47 in the Top 21-40 institutions and .26 in the Top 41-70 institutions. Findings related to promotion to full professor from both Ph.D. conferral and from promotion to associate professor, and those identified as warranting exceptional publication productivity are also presented. The findings provide substantive implications for marketing academics, those involved with the recruitment and retention of marketing academics and the field of marketing thought.
Although the goal of a product recall program is to enhance safety, there is little known about whether firms learn from product recalls. This study tests the direct effect of product recalls on future accidents and future recall frequency and indirect effect through future product reliability in the automobile industry. The hypotheses are tested on 459 make-year observations involving 27 automobile makers between the period 1995 and 2011. The findings suggest that increases in recall magnitude lead to decreases in future number of injuries and recalls. This effect, in turn, is partially mediated by future changes in product reliability. The results also suggest that the positive relationship between changes in recall magnitude and changes in future product reliability is 1) stronger for firms with higher shared product assets and 2) weaker for brands of higher prior quality. The findings are robust across alternate measures and alternate model specifications and offer valuable insights for managerial practice and public policy.
The authors investigate the relationships between brand equity and customer acquisition, retention, and profit margin, the key components of customer lifetime value (CLV). They examine a unique database from the U.S. automobile market that combines ten years of acquisition rate, retention rate, and customer profitability data with measures of brand equity from Young & Rubicam’s Brand Asset Valuator (BAV) over the same period. They hypothesize and find that BAV brand equity is significantly associated with the components of CLV in expected and meaningful ways. For example, customer knowledge of a brand has an especially strong positive relationship with all three components of CLV. Notably, however, differentiation is a double-edged sword. While it is associated with higher customer profitability, it is also associated with lower acquisition and retention rates. The authors also find that marketing efforts exert indirect impacts on CLV through brand equity. Simulations show that changes in marketing, or exogenous changes in brand equity, can exert important effects on CLV. Overall, the findings suggest that the “soft” and “hard” sides of marketing need to be managed in a coordinated way. The authors conclude with a discussion of these and other implications for researchers and practitioners.
In mergers and acquisitions (M&As), brands account for significant but heterogeneous proportions of overall transaction value. The marketing literature focuses on the drivers of financial value of brands when there is no change in the ownership of brands. However, in M&As, the value of brands also depends on how their new owners leverage them. This study identifies both the target and the acquirer firm characteristics that affect the value of a target firm’s brands in M&As. The study uses audited measures of acquired brand value from Securities and Exchange Commission filings (made available as a result of recent statutory reporting requirements) along with data collected from diverse secondary sources. The empirical test of the model is based on 133 M&A transactions in which acquirers attribute value to target firms’ brands. The results indicate that acquirer and target marketing capabilities and brand portfolio diversity have positive effects on a target firm’s brand value. The positive impact of acquirer brand portfolio diversity and target marketing capability is lower when the M&A is synergistic than when it is nonsynergistic. The findings are robust to various model specifications, measures, endogeneity, and sample selection.
Corporate acquisitions are a ubiquitous feature of today’s business landscape and a widely used means by which large firms enter new markets. As large acquirers swoop in to acquire firms in new markets, they are almost inevitably met with a chorus of concerns about the potential effects of their actions on the markets they enter. What is the actual impact of acquisitive entry by large firms on the strategies and performance of incumbents? How do incumbents reconfigure the way they compete after a behemoth enters their market? The authors focus on an important facet of firms’ competitive positions — their product mix — and propose a framework that explains incumbent firms’ reaction to acquisitive entry by large firms, as well as the performance implications of these reactions. They test the hypotheses that result from this framework by examining the impact of acquisitive entry across a large number of firms and consumer markets over time: The data cover 839 acquisitions in 583 metropolitan statistical areas in the U.S. banking industry. The results indicate that incumbents are more likely to align their product mix strategy with that of the acquisitive entrant if (1) the incumbent is large, (2) the acquirer’s past performance has been strong, and (3) the market served by the incumbent is small. Importantly, how incumbents react has significant performance implications: The authors find that large incumbents that deviate from acquirers’ product mix strategy perform better than other incumbents do.
This study empirically examines the longitudinal influences of salesperson goal orientations on performance trajectories during a planned change intervention that requires learning in order to answer two questions. First, what is the functional form of salespeople’s performance trajectories during a period of change implementation? Second, why are some salespeople better at adapting to change than others? Polynomial growth models showed that the average salesperson performance trajectory displayed an initial decline, gradual recovery, and eventual restabilization. Salespeople’s learning orientation related positively to larger initial declines, steeper recovery slopes, and higher restabilization levels. In contrast, performance orientation related positively to smaller initial declines, yet shallower recovery slopes and lower restabilization levels. Results suggest that successful implementation of planned change interventions largely depends on identifying and appreciating the heterogeneity of individual traits that share meaning with the change. The study has implications on what sales managers should expect in terms of performance losses and gains during change and how managers can predict which salespeople will reap the largest performance benefits from a change intervention.
In this paper, we propose a conceptual framework to explain whether and when the introduction of a new retail store channel helps and hurts sales in existing direct channels. A conceptual framework separates short- and long-run effects by analyzing the capabilities of a channel that help consumers accomplish their shopping goals. To test the theory, we analyze a unique data set from a high-end retailer using matching methods. We study the introduction of a retail store and find evidence of cross-channel cannibalization and synergy. The presence of a retail store decreases sales in the catalog, but not Internet channel, in the short term, but increases sales in both direct channels over time. Following the opening of the store, more first-time customers begin purchasing in the direct channels. These results suggest that adding a retail store to direct channels yields different results from adding an Internet channel to a retail store channel as previously studied.
Network effects and standards competition introduce significant uncertainty into consumers’ new-product adoption decisions, creating a substantial challenge to the success of innovating firms. While the literature has highlighted the importance of establishing a large installed-user base (the number of users adopting the same product) in such markets, this paper draws attention to a different but potentially important market force: the supporting-firm base, which we define as the number of firms supporting the same technological standard. We propose a set of hypotheses concerning the impact of the supporting-firm base on consumers’ product valuation in the presence of network effects and standards competition. Our empirical analyses of disk drive markets show that, (1) Consumer product valuation is positively affected not only by the installed-user base but also by the supporting-firm base; (2) The two positive effects cannot be substituted, rather, the effort in building either would be less effective unless accompanied by the other; and (3) The impact of the supporting-firm base depends on not only its size but also the characteristics of the supporting-firms: consumers are affected more (a) by firms exclusively supporting a single standard than by firms supporting multiple standards, and (b) by incumbents than by new entrants.