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Evolving to a New Dominant Logic
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Marketing inherited a model of exchange from economics, which had a dominant logic based on the exchange of "goods," which usually are manufactured output. The dominant logic focused on tangible resources, embedded value, and transactions. Over the past several decades, new perspectives have emerged that have a revised logic focused on intangible resources, the cocreation of value, and relationships. The authors believe that the new per- spectives are converging to form a new dominant logic for marketing, one in which service provision rather than goods is fundamental to economic exchange. The authors explore this evolving logic and the corresponding shift in perspective for marketing scholars, marketing practitioners, and marketing educators.
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... The sharing economy enables collective value creation, involving collaborative processes with customers and firms conceiving, designing, developing and innovating (Nangpiire et al., 2022;Vargo and Lusch, 2004;Zhang and Ma, 2022). Within this framework, platforms establish ecosystems, uniting potential customers and providers. ...
... Comprehending the impact of platform-specific attributes on service providers' economic behaviors holds essential importance in platform ecosystems (Costello and Reczek, 2020). Prior research highlights that value creation in the sharing economy primarily stems from providers and customers (Nangpiire et al., 2022;Vargo and Lusch, 2004). Indeed, their active engagement in value co-creation relies on platform support (Sutherland and Jarrahi, 2018), facilitated by technology infrastructure that connects providers and customers, fostering positive relationships (Rietveld et al., 2019). ...
Purpose-This study investigates how role overload in the sharing economy leads to emotional exhaustion, which restricts value co-creation activity, and also investigates the moderating effect of perceived platform support. Design/methodology/approach-Two experimental investigations and field research questionnaires were given to respondents with shared mobility industry expertise. Findings-First, role overload detrimentally affects service providers' value co-creation behavior; second, emotional exhaustion acts as a mediator between role overload and value co-creation behavior; and finally, perceived platform support moderates the adverse effect of role overload on emotional exhaustion. Originality/value-To the best of the authors' knowledge, this study is the first to explore the antecedents of value co-creation behavior from the service provider's perspective, extending the application of COR theory in a sharing economy context. Effect of role overload on value co-creation Research limitations-First, alternative mediators between role overload and emotional exhaustion were not identified. Second, other dimensions of role overload and their impacts were not examined. Lastly, this study did not explore broader perspectives beyond algorithms. Practical implications-This study recommends that managers reduce role overload ex ante in terms of clarifying responsibilities and obligations, providing substantive resource support and rationalizing order allocation, respectively.
... In addition to this our findings also have some theoretical implications, especially with regards to co-creation, co-production, and co-development strategies of solutions. The foundational theory on which the concept of value co-creation is based was SD-logic introduced by Vargo and Lusch (2004). This theory outlines how the roles of the firm and the customer in a value creation process are intertwined with each other and value can only be created when customer uses the service which in turn builds the fundamental basis for introducing the role of a CS manager who monitors value-in-use (Vargo and Lusch 2004). ...
... The foundational theory on which the concept of value co-creation is based was SD-logic introduced by Vargo and Lusch (2004). This theory outlines how the roles of the firm and the customer in a value creation process are intertwined with each other and value can only be created when customer uses the service which in turn builds the fundamental basis for introducing the role of a CS manager who monitors value-in-use (Vargo and Lusch 2004). ...
Achieving Customer Success (CS) has become the primary goal for Anything as a service (XaaS) vendors with recurring revenue models to provide continuous value to their customers. This article attempts to present the theoretical insights on the key drivers of CS Management and proposes a conceptual framework based on 32 in-depth interviews with CS Practitioners. First, this article analyses the theoretical foundations and customer value management challenges for the newly emerging field of CS for subscription-based business models. Second, this article outlines three key drivers (prevent churn, increase success, ensure usage continuance from the conceptual framework) for CS from the voices of practicing CS professionals using the Grounded Theory Method (GTM). Third, this article analyzes the key drivers along with root cause analysis for churn and recognizes the practical implications of operating model shifts involved in moving to subscription models for XaaS vendors. The article can be found here: https://aisel.aisnet.org/icis2023/isdesign/isdesign/1/
... Premis dasar pada logika dominan layanan (service dominant logic) sebagai perspektif untuk mempertimbangkan bagaimana layanan diciptakan sebagai dasar dari pertukaran (Vargo & Lusch, 2014). Pemikiran ini mengungkapkan bahwa proses penciptaan nilai di mana para aktor terlibat dalam integrasi sumber daya dan pertukaran layanan, diaktifkan dan dibatasi oleh pengaturan institusional, membangun ekosistem layanan dan saling terkait. ...
Tujuan dari penelitian ini berkontribusi untuk mengeksplorasi pemahaman yang holistik tentang pengalaman layanan terhadap keunggulan daya saing. Penelitian ini menggunakan desain penelitian kualitatif melalui teknik penelitian kepustakaan. Penelitian menyajikan berbagai jurnal publikasi internasional bereputasi dibidang pemasaran dari tahun 2016 hingga 2023 dengan menggunakan pendekatan literature review. Temuan penelitian menyoroti bahwa terdapat tiga karakterisasi pengalaman layanan yang mampu memperkuat tatanan rantai layanan. Penelitian ini memberikan literatur lengkap mengenai pengalaman layanan yang mampu mempertajam design dan karakter layanan serta implikasinya terhadap keunggulan daya saing.
... In addition to the supply-side and demand-side studies, the development of a service-dominant logic (SDL) tries to incorporate the position of multiple parties (manufacturers, consumers, governments, and other stakeholders) into the idea of value creation (Vargo & Lusch, 2004;Grönroos, 2012). Ranjan and Read (2016) believe that the SDL's V-Crea covers the concept of co-production and value-in-use. ...
The purpose of this study is to explore how multi-stakeholder co-create collective value in a local context. Moreover, we aim to examine what barriers between the participators and what mechanisms could reduce these barriers, and then induce the local value. This paper presents a collaborative project that the university implemented in Jia-dong, a township of Pingtung county in Taiwan. Jia-dong is a traditional Hakka cluster with rich and historical elements. The purpose of collaborative project is to integrate Jia-dong’s developmental factors and help to create local value. This case study demonstrates that different stake-holder motivations and their ability to provide resources, differences are observed in the value creation activities and mechanisms at three stages: mobilization, expansion, and stabilization. This paper contrib-utes in two aspects: first, it highlights the evolution of collaborative rela-tionships among stakeholders during the process of value co-creation, and second, it provides a deep understanding of the role of value co-creation mechanisms is deeply understood while collaborative barriers derive from developing the local tourism.
In today's technology-driven landscape, the internet and social media have seamlessly woven themselves into the fabric of both brands and consumers' lives. Among the arsenal of modern marketing strategies, influencer marketing has emerged as a formidable force. It bestows organisations the privilege of accessing extensive and dedicated online influencers and co-creation as a technique, making it one of the most potent tools in their marketing toolkit. This chapter focuses on the intricate art of how brands strategically harness the power of social media platforms and influencers to extend their reach far and wide, aiming to connect with as many consumers as possible. By forging these connections, brands aspire to cultivate a devoted and unwavering fan base, fostering long-term customer loyalty.
The occurrence of large-scale crises is a great challenge for people. In such cases, many levels of public life are affected and recovery takes time and considerable resources. Therefore, approaches and tools for predicting and preventing crises, as well as models and methods for crisis management and crisis overcoming, are necessary. In this review, we present approaches, models, and methods that support decision-making in relation to the prevention and resolution of large-scale crises. We divide crises into three types: natural disasters, pandemics, and economic crises. For each type of crisis situation, the types of applied tasks that are solved and the corresponding models and methods that are used to support decision-makers in overcoming the crises are discussed. Conclusions are drawn on the state of the art in this area and some directions for future work are outlined.
As marketing gains increasing prominence as an orientation that everyone in the organization shares and as a process that all functions participate in deploying, a critical issue that arises is the role of the marketing function. Specifically, what role should the marketing function play, and what value does the marketing function have, if any, in an organization that has a strong market orientation? The authors take the view that though a firm's market orientation is undeniably important, the marketing function should play a key role in managing several important connections between the customer and critical firm elements, including connecting the customer to (1) the product, (2) service delivery, and (3) financial accountability. The authors collect data from managers across six business functions and two time periods with respect to marketing's role, market orientation, the value of the marketing function, and perceived firm performance. The results show that the marketing function contributes to perceptions of firm financial performance, customer relationship performance, and new product performance beyond that explained by a firm's market orientation. Marketing's value, in turn, is found to be a function of the degree to which it develops knowledge and skills in connecting the customer to the product and to financial accountability. For service firms, the value of the marketing function also is related positively to marketing's ability to connect the customer to service delivery.
The authors present a case for integrating technology and marketing strategy as key elements that affect corporate success in rapidly changing environments. After describing the implications of technological change for firm behavior, the authors propose a framework for developing a technology strategy and introduce the technology portfolio. The technology portfolio serves both as a model for technological resource allocation and as an aid in choosing an optimal set of technologies from a set of feasible alternatives.
As the twenty-first century dawns, marketing is poised for revolutionary changes in its organizational context, as well as in its relationship with customers. Driven by a dynamic and knowledge-rich environment, the hierarchical organizations of the twentieth century are disaggregating into a variety of network forms, including internal networks, vertical networks, intermarket networks, and opportunity networks. The role of marketing in each network is changing in profound ways. Marketing increasingly will be responsible for creating and managing new marketing knowledge, education, real-time market information systems, intrafirm integration, conflict resolution, technology forecasting, risk and investment analysis, transfer pricing of tangibles and intangibles, and the coordination of the network's economic and social activities. It will explore new frontiers in multilateral marketing, reshape markets through technology convergence and electronic commerce, organize consumer communities, and aggregate consumer information and demand into saleable business assets. The most radical implication for marketing is the shift from being an agent of the seller to being an agent of the buyer, from being a marketer of goods and services to being a customer consultant and manager of his or her saleable consumption assets.
Four fundamental issues serve to establish the identity of the field of marketing, distinguish it from other fields and disciplines, and compel further research inquiry. These issues ask (1) How do customers and consumers really behave? (2) How do markets function and evolve? (3) How do firms relate to their markets? and (4) What are the contributions of marketing to organizational performance and societal welfare? These issues also serve as the organizing framework for this special issue
Although the questions posed by these fundamental issues are durable, new answers will need to be sought to accommodate the following trends and disruptions that are shaping the direction of marketing: (1) the connected knowledge economy; (2) globalizing, converging, and consolidating industries; (3) fragmenting and frictionless markets; (4) empowered customers and consumers; and (5) adaptive organizations. These new directions challenge academic marketing to provide meaningful measures, inferences, and calibration; understand functional interfaces; and rethink the role of theory.
The authors develop a framework for understanding the integration of marketing with business processes and shareholder value. The framework redefines marketing phenomena as embedded in three core business processes that generate value for customers—product development management, supply chain management, and customer relationship management—which in turn creates shareholder value. Such a conceptualization of marketing has the potential to introduce dramatic shifts in the scope, content, and influence of marketing in the organization. The authors highlight the implications of an organizationally embedded view of marketing for the future of marketing theory and practice.
New organization forms, including strategic partnerships and networks, are replacing simple market-based transactions and traditional bureaucratic hierarchical organizations. The historical marketing management function, based on the microeconomic maximization paradigm, must be critically examined for its relevance to marketing theory and practice in the 1990s. A new conception of marketing will focus on managing strategic partnerships and positioning the firm between vendors and customers in the value chain with the aim of delivering superior value to customers. Customer relationships will be seen as the key strategic resource of the business.
The literature reflects remarkably little effort to develop a framework for understanding the implementation of the marketing concept. The authors synthesize extant knowledge on the subject and provide a foundation for future research by clarifying the construct's domain, developing research propositions, and constructing an integrating framework that includes antecedents and consequences of a market orientation. They draw on the occasional writings on the subject over the last 35 years in the marketing literature, work in related disciplines, and 62 field interviews with managers in diverse functions and organizations. Managerial implications of this research are discussed.
Marketing academicians and practitioners have been observing for more than three decades that business performance is affected by market orientation, yet to date there has been no valid measure of a market orientation and hence no systematic analysis of its effect on a business's performance. The authors report the development of a valid measure of market orientation and analyze its effect on a business's profitability. Using a sample of 140 business units consisting of commodity products businesses and noncommodity businesses, they find a substantial positive effect of a market orientation on the profitability of both types of businesses.
Effective organizations are configurations of management practices that facilitate the development of the knowledge that becomes the basis for competitive advantage. A market orientation, complemented by an entrepreneurial drive, provides the cultural foundation for organizational learning. However, as important as market orientation and entrepreneurship are, they must be complemented by an appropriate climate to produce a “learning organization.” The authors describe the processes through which organizations develop and use new knowledge to improve performance. They propose a set of organizational elements that comprise the learning organization and conclude with recommendations for research to contribute to the understanding of learning organizations.
Considerable progress has been made in identifying market-driven businesses, understanding what they do, and measuring the bottom-line consequences of their orientation to their markets. The next challenge is to understand how this organizational orientation can be achieved and sustained. The emerging capabilities approach to strategic management, when coupled with total quality management, offers a rich array of ways to design change programs that will enhance a market orientation. The most distinctive features of market-driven organizations are their mastery of the market sensing and customer linking capabilities. A comprehensive change program aimed at enhancing these capabilities includes: (1) the diagnosis of current capabilities, (2) anticipation of future needs for capabilities, (3) bottom-up redesign of underlying processes, (4) top-down direction and commitment, (5) creative use of information technology, and (6) continuous monitoring of progress.