Marketing and the multinational: extending internalisation theory

Introducing marketing explicitly into the internalisation theory of the multinational enterprise considerably extends the power of the theory. In particular, it enables a comparison of marketing-led and technology-led multinationals and highlights the benefits of collaboration between them. It facilitates the analysis of outsourcing, and in particular of R&D. It highlights the importance to marketing-led firms of owning product rather than facilities. The analysis addresses key issues relating to “hollow firms”, “flagship firms” and the “global factory”.     

Market-focused sustainability: market orientation plus!

The concept of sustainability is increasingly being addressed theoretically by scholars and practically by managers and policymakers. With this growing focus on sustainability efforts, marketing is in a unique position to elevate its focus from managing relationships with customers to strategically managing a broader set of marketplace issues. Overall, an organization achieves market-based sustainability to the extent that it strategically aligns itself with the market-oriented product needs and wants of customers and the interests of multiple stakeholders concerned about social responsibility issues involving economic, environmental, and social dimensions. To set the stage for marketing’s inquiry into sustainability efforts, I briefly review the concept of sustainability, compare it with corporate social responsibility, bring in stakeholders, argue for the notion of “market orientation plus,” and consider the possibility that the notion of what sustainability encompasses is converging in the marketing literature.     

Why “service”?

“Service-dominant logic” appears to have found resonance in the marketing community since its introduction as the evolving, “new dominant logic” in the Journal of Marketing (Vargo and Lusch 2004a, Journal of Marketing, 68, 1–17 (January)). But, on occasion, so has the question of whether the concept “service” captures the essence of the new logic. This article addresses the role of “service” as the heart of value-creation, exchange, markets, and marketing, as well as its considerable implications for research, practice, societal well-being, and public policy. The purposes are both to clarify the issues and to foster the continuing dialog around the service-dominant logic for marketing, as well as for other disciplines.     

Service-dominant logic: continuing the evolution

Since the introductory article for what has become known as the “service-dominant (S-D) logic of marketing,” “Evolving to a New Dominant Logic for Marketing,” was published in the Journal of Marketing (Vargo, S. L., & Lusch, R. F. (2004a)), there has been considerable discussion and elaboration of its specifics. This article highlights and clarifies the salient issues associated with S-D logic and updates the original foundational premises (FPs) and adds an FP. Directions for future work are also discussed.     

Customer relationship management and firm performance: the mediating role of business strategy

As managers and academics increasingly raise issues about the real value of CRM, the authors question its direct and unconditional performance effect. The study advances research on CRM by investigating the role of critical mechanisms underlying the CRM-performance link. Drawing from the sources → positions → performance framework, the authors build a research model in which two strategic postures of firms—differentiation and cost leadership—mediate the effect of CRM on firm performance. This investigation also contributes to the literature by drawing attention to the differential impact of CRM in diverse industry environments. The study analyzes data from in-depth field interviews and a large-scale, cross-industry survey, and results reveal that CRM does not affect firm performance directly. Rather, the CRM-performance link is fully mediated by differentiation and cost leadership. In addition, CRM’s impact on differentiation is greater when industry commoditization is high.     

Listening to your customers: The impact of perceived salesperson listening behavior on relationship outcomes

A thorough understanding of how businesses gain and maintain long-term relationships with clients is critical in today’s environment. This study develops a scale for salesperson listening behavior and investigates the impact of customers’ perceptions of salespeople’s listening behavior on trust, satisfaction, and anticipation of future interaction. A structural equations model is developed and empirically tested using a sample of new car buyers. The research results suggest that listening is a higher-order construct composed of three dimensions: (a) sensing, (b) evaluating, and (c) responding. When customers perceive a high level of listening behavior by a salesperson, it enhances their trust in the salesperson and leads to greater anticipation of future interaction. Implications and future research issues are discussed. Her research interests include measurement issues, buyer-seller relationships, sales technology, and creativity. She has published inJournal of Retailing, Journal of Business Research, Journal of Personal Selling & Sales Management, and various other journals and proceedings. His research interests include issues in personal selling, sales management, and channels of distribution. He has published inEuropean Journal of Marketing, Journal of the Academy of Marketing Science, Journal of Macromarketing, Journal of Marketing Theory and Practice, Journal of Retailing, Psychology and Marketing, and various conference proceedings.     

Food availability, food entitlements, and radicalism during the Chinese great leap forward famine: an econometric panel data analysis

The purpose of this article is to investigate the socio-economic as well as the political, institutional, and ideological causes of the Chinese famine of 1959–1961. The main hypothesis of this paper is that the radical policies implemented as part of the Great Leap Forward resulted in agricultural output decline (i.e., availability issues), and in the implementation of an ineffective food distribution policy affecting rural populations (i.e., accessibility issues). An econometric analysis, based on provincial panel data from the 1954–1966 period, stresses the effect of ill-advised economic policies in handling the famine. This analysis also confirms that the increase in mortality rates during the famine was caused by the simultaneous collapse in food availability and food accessibility in rural areas.     

Identification management and its bases: Bridging management and marketing perspectives through a focus on affiliation dimensions

There has been growing interest in both management and marketing regarding how individuals become identified with organizations and how organizations attempt to manage these identifications. The authors present a framework built on explicit and implicit points of convergence in research conducted in both these disciplines. In their review of the management and marketing literatures, the authors suggest three fundamental mechanisms, or “bases”, for managing organizational identification: relational, behavioral, and symbolic. Furthermore, the authors argue that how an individual is affiliated with an organization will impact the relative influence of these identification management bases. The authors conclude by suggesting how management and marketing scholars can create a theoretical space for future interdisciplinary work Such a change would involve moving away from “employees” versus “customers” as a prime division between the fields and moving toward a more fine-grained approach that emphasizes the unique characteristics of individual-organizational relationships. M. Teresa Cardador (cardador@uiuc.edu) is a doctoral student in management at the University of Illinois at Urbana-Champaign. Her research explores issues related to workplace attachment and identification, work orientation, and the experience of employees who find work highly meaningful and engaging. Michael G. Pratt (mpratt@uiuc.edu) is a James F. Towey Fellow and an associate professor of management at the University of Illinois at Urbana-Champaign. He earned his Ph.D. at the University of Michigan. His articles have appeared in leading management outlets, includingAdministrative Science Quarterly, theAcademy of Management Journal, theAcademy of Management Review, andResearch in Organizational Behavior. He recently coedited (with Anat Rafaeli) a book titledArtifacts and Organizations: Beyond Mere Symbolism (Lawrence Erlbaum, 2005). His current research examines issues of organizational attachment (e.g., identification and commitment), multiple identities and meaning, and intuition. Dr. Pratt’s work focuses largely on professionals in both traditional and dispersed work contexts.     

Commentary on an empirical investigation of a general theory of marketing ethics

The article “An Empirical Investigation of a General Theory of Marketing Ethics” by Mayo and Marks constitutes a major effort at testing the theory of marketing ethics developed by Scott Vitell and me (1986). Mayo and Marks (hereafter, “M&M”) deduce several key research hypotheses from the theory, test those hypotheses using a marketing research scenario, and conclude: “The core relationships in Hunt and Vitell’s model appear to capture much of the decision-making processes that marketing managers employ in resolving an ethical dilemma.” Although no single empirical study ever provides a definitive test of a theory, their encouraging findings will likely prompt further empirical studies. The objective of this commentary is not to criticize the design of M&M’s research, for there is no such thing as a perfect research design. All efforts to test empirically a theory will necessarily involve significant amounts of interpretive creativity and there are always trade-offs to be made. Rather, the objective here is to (1) review certain exemplary aspects of the M&M research design, (2) suggest some alternative interpretations and procedures for future researchers in this area to consider, and (3) show how some of the issues in their article relate to more fundamental philosophy of science concerns.     

Establishing human brands: determinants of placement success for first faculty positions in marketing

Based on primary data spanning 5 years, we examine factors that influence the entry-level placement of marketing doctoral candidates at U.S. universities and colleges. Contributing to the emerging research on human brands, we identify marketing doctoral candidates’ intrinsic and extrinsic brand cues that influence their number of AMA interviews, campus visit offers, and starting base salary. The strongest brand cue is the research productivity of candidates’ doctoral degree-granting departments. A related cue that also predicts initial salary is the candidates’ advisors’ research record. Further, when beginning the job search, doctoral students who have a top research publication, who have a dissertation proposal defended with data, and who have attended the AMA-Sheth Foundation Doctoral Consortium receive a substantial entry salary premium. Based on branding frameworks and theories of academic rewards, this study adds to the emerging knowledge on both the concept of human brands as well as the growing literature on issues relating to marketing academia.     

Expanding our understanding of marketing in society

The Journal of the Academy of Marketing Science was started 40 years ago, at a time when “marketing in society” issues were capturing much attention from marketing scholars. Since that time both the field and this journal have grown and matured, but the marketing in society area has become somewhat removed from the dominant perspectives of marketing scholarship. This paper provides an historical perspective on these developments and offers an examination of the fundamental role of societal interests in our field. Six basic topics are explored: (1) the hundred years of history of marketing thought development, as reflected in the “4 Eras” of marketing thought; (2) the ebbs and flows of attention to marketing in society topics during these 4 Eras; (3) two illustrations of difficulties brought about by this area’s move to sideline status in the field; (4) our concept of the “aggregate marketing system” as a basis for appreciating the centrality of this research area for the field of marketing; (5) the nature of marketing in society research today; and (6) a discussion of several research challenges and opportunities for the future.     

Drucker’s insights on market orientation and innovation: implications for emerging areas in high-technology marketing

In 1954, Drucker boldly declared that organizations have only two basic functions, marketing and innovation. While true for any organization, this insight is particularly pertinent for technology-based businesses. The complicated environment surrounding high-tech companies creates a great need for sophisticated marketing. Yet these companies continue to have under-developed competencies in marketing and in understanding customer needs. This essay explores Drucker’s insights with respect to two particularly salient issues for high-tech companies: developing and implementing a market orientation and break-through innovations. We review Drucker’s insights and synthesize them with the scholarly research on these issues. Finally, we discuss three emerging areas in high-tech marketing where academics and managers could build on Drucker’s insights to guide future research and practice: market driving, customer co-creation, and corporate social responsibility. These illustrative examples highlight that even today, Drucker’s writings continue to offer remarkable guidance to scholars and managers who are willing to take the time to reflect, understand, and incorporate his insights in the unique context of high-tech industries. Electronic supplementary material  The online version of this article (doi:) contains supplementary material, which is available to authorized users.

Developing global products and marketing strategies: A construct and a research agenda

The U.S. trade deficit brings to question the effectiveness of international marketing strategies of American firms. Multinational corporations must develop better international products and improve their performance in their international marketing efforts. They must know when to globalize or localize their marketing practices. This article incorporates learning, involvement, diffusion/adoption and culture context as dimensions of a global product and marketing strategy development decision model. The model developed is “be global, act local.” The interrelationship of consumer behavior models in the context of a multinational product development decision is emphasized. This article raises research issues which need to be addressed for future success in multinational and/or multicultural markets.     

Modelling trends and cycles in economic time series: historical perspective and future developments

This paper provides a retrospective on the modelling of trends and cycles in economic time series and considers where the research agenda currently stands and where future developments might lie. A brief survey of the early empirical research on trends and cycles is first provided before attention is focused on four papers published in 1961—our ‘annus mirabilis’ of trend and cycle modelling—which we argue have been ‘prime movers’ in various aspects of research in this area. The links from these papers to current research issues are then teased out before the likely future directions of research in both theoretical and applied aspects of the modelling of trends and cycles are considered.

Offshore outsourcing of customer relationship management: conceptual model and propositions

Customer relationship management (CRM) refers to a firm’s activities for establishing and maintaining relationships with its customers. Outsourcing refers to a firm’s contracting with another firm to perform activities that were erstwhile performed within the firm. The emergence of a low cost, high speed, global communication network and information processing network has enabled an increasing number of firms based in more industrialized market economies to outsource specific elements of their CRM to offshore vendors located in countries with significantly lower labor costs. Building on scholarly insights from multiple literature streams, we present a conceptual model delineating the antecedents and consequences of CRM offshore outsourcing intensity. We also provide a literature overview of the determinants of location choice decision for offshore outsourcing, an issue that is closely linked to the offshore outsourcing decision. The growing trend toward offshore outsourcing of CRM serves to highlight a number of issues that merit careful managerial consideration. In this context, we highlight supply-side versus demand-side effects of CRM offshore outsourcing, the economics of CRM offshore outsourcing versus CRM automation, CRM offshore outsourcing versus CRM offshoring, and the evolution of hierarchical CRM organizations toward market based CRM business systems, and other issues.     

Transaction cost economics and its uses in marketing

Scholarship at the intersection of transaction cost economics (TCE) and marketing has enjoyed an impressive record of growth over the past three decades, and the future promises more of the same. Following Erin Anderson’s perceptive uses of TCE in her 1982 dissertation, the field of marketing has made many constructive uses of and contributions to TCE, where the latter include broadening the reach of TCE, posing important challenges, and identifying opportunities still to be addressed. Given this history, we advance the proposition that the relation between TCE and marketing has been and should be a two-way street. In considering the scope for future research, we give special attention to issues of asymmetric costs, the dynamics of governance, and disequilibrium contracting. We also discuss the four precepts of pragmatic methodology, with special emphasis on prediction and empirical testing. The Appendix provides added perspective on the evolving “science of organization” of which TCE is a part.     

Achieving relationship marketing effectiveness in business-to-business exchanges

Relationship marketing research and practice operate according to the paradigm that firms should invest in relationship marketing to build better relationships, which will generate improved financial performance. However, findings that relationship marketing efforts vary in their effectiveness across customers and may even be detrimental to performance challenge this belief. This article, therefore, offers a theoretical model that addresses three key issues: 1) what factors determine a customer’s need for relational governance (relationship orientation); 2) what mediating mechanism captures the negative effects of relationship marketing on performance (exchange inefficiency); and 3) how does a customer’s relationship orientation determine the effectiveness of relationship marketing, thus allowing for effective segmentation. The authors demonstrate in an empirical study that the trust in the salesperson and exchange inefficiency both mediate the effect of relationship marketing on seller financial outcomes. In addition, customers’ relationship orientation moderates the impact of relationship marketing on both trust and exchange inefficiency.     

Theory and external validity

Winer (1999 [this issue]) proposes that external validity concerns require more attention in theoretical research. The author argues that one cannot “enhance” external validity by choosing one method over another. External validity can only be “assessed” by better understanding how the focal variables in one’s theory interact with moderator variables that are seen as irrelevant early in a research stream. Findings from single real-world settings and specific sets of “real” people are no more likely to generalize than are findings from single laboratory settings with student subjects. Both the laboratory and real world vary in background facets of subject characteristics, setting, context, relevant “history,” and time. It is only when these facets vary and we see how they interact that understanding of external validity is enhanced. For this to happen, the observable “background” factors have to be conceptualized in terms of more general constructs and incorporated as moderators into the researcher’s theory. Enriched theory—not method—confers confidence in our understanding of whether effects will be robust or highly contingent. To map this knowledge to some specific substantive system requires an added step of understanding the mapping from observables in that system onto theoretical constructs. The author proposes “friendly amendments” to Winer’s three proposals to pursue a better understanding of external validity through theory. John G. Lynch, Jr. is the Hanes Corporation Foundation Professor of Business Administration at Duke University. His research and teaching interests are in consumer behavior, electronic commerce, and validity issues in research methodology. He a past president of the Association for Consumer Research, past associate editor for theJournal of Consumer Research, and past associate editor and coeditor of theJournal of Consumer Psychology. He has been the recipient of the MSI/Paul Root Award atJournal of Marketing, the William O’Dell Award atJournal of Marketing Research, and has twice been the recipient of theJournal of Consumer Research best article award.     

The effects of expertise,end goal,and product type on adoption of preference formation strategy

The global preference formation model identifies several preference formation strategies (i.e., own-based, other-based, or hybrid) that consumers use to select among alternative product offerings. This article examines how consumers’ expertise level (novice vs. expert), their end goals (satisficing vs. optimizing), and product type (search vs. experience product) collectively influence the preference formation strategy likely to be adopted. Results from an experiment indicate that the adoption of a given strategy is influenced by interactions between subjects’ expertise level and their end goals and the product type. Novice satisficers employed a higher proportion of own-based strategies than novice optimizers, but expert satisficers used a lower proportion of own-based strategies than expert optimizers. When compared to novices choosing a search product, novices selecting an experience product used a lower proportion of own-based and a higher proportion of other-based strategies. Similarly, when compared to experts choosing a search product, experts selecting an experienced product used a lower proportion of own-based strategies, but this was accompanied by a higher proportion of hybrid strategies. Implications and directions for future research are discussed. Her current research interests include consumer choice processes, electronic decision aids, and measurement issues in marketing. His research interests include consumer information search, marketing communications, and measurement issues.