Where is the opportunity without the customer? An integration of marketing activities, the entrepreneurship process, and institutional theory

Marketing and entrepreneurship have long been recognized as two key responsibilities of the firm. Despite their tight integration in practice, marketing and entrepreneurship as domains of scholarly inquiry have largely progressed within their respective disciplinary boundaries with minimal cross-disciplinary fertilization. Furthermore, although firms increasingly undertake their marketing and entrepreneurial activities across diverse settings, academe has provided little insight into how changes in the institutional environment may substantially alter the processes and outcomes of these undertakings. Herein, we integrate research on marketing activities, the entrepreneurship process, and institutional theory in an effort to address this gap. We first discuss market orientation as enhancing a firm??s opportunity recognition and innovation, whereas marketing mix decisions enhance opportunity exploitation. We then examine how entrepreneurship leads to innovation directed toward market orientation and marketing mix activities. Based on this foundation, we examine differences in marketing and entrepreneurship activities across institutional contexts.     

Does marketing and sales integration always pay off? Evidence from a social capital perspective

Building on social capital theory, we view the marketing and sales interface as a set of inter-group ties and investigate how cross-functional relationships may facilitate the development of social capital associated with value creation. Our findings suggest that social capital embedded in marketing and sales relationships can inhibit a firm’s performance depending on the characteristics of its customers. Our results also demonstrate that managing the marketing and sales interface at different levels of customer concentration is critical to the success of a firm’s performance.     

Improving customer-focused marketing capabilities and firm financial performance via marketing exploration and exploitation

Evidence within the marketing literature has shown that marketing capabilities are important drivers of firm performance. However, very little is known about how firms improve their marketing capabilities via the embedding of new market knowledge. Organizational learning theory provides us with a theoretical lens through which we can examine how existing customer-focused marketing capabilities may be improved and new customer-focused marketing capabilities may be created via marketing exploitation and exploration capabilities. In addition, this study investigates whether ambidexterity in marketing exploration and exploitation exists and finds that firms cannot do both at high levels without risking a negative impact on customer-focused marketing capabilities. This study also presents findings demonstrating how improving the two customer-focused marketing capabilities in our study, brand management and customer relationship management, impacts objective financial performance.     

Innovation pathway to profitability: the role of entrepreneurial orientation and marketing capabilities

Drawing from the marketing capabilities and innovation literatures, we identify aprocess by which a firm’s entrepreneurial orientation impacts profits and show that it is dependent on marketing capabilities. Using a half-longitudinal design we integrate survey data with performance metrics over two time periods, from a sample of 190 firms. While the effect of entrepreneurial orientation (EO) on innovation is enhanced by architectural marketing capabilities, the effect of innovation outcomes on profits is enhanced by specialized marketing capabilities. Ultimately, the pathway from EO to performance, mediated by innovation, is positively significant at higher levels of both marketing capabilities. The results uncovered using Bayesian conditional process modeling, are robust to alternate model specifications, endogeneity tests, and provide insights into the capabilities-based understanding of entrepreneurism-marketing interface. We discuss resource allocation implications for managers as they attempt to maximize profits through innovation.     

Using a customer-Level marketing strategy to enhance firm performance: A review of theoretical and empirical evidence

It is becoming increasingly apparent from the literature that marketers need to consider customer-level information when they generate a marketing strategy for the firm. In this article, the authors develop a customer-focused framework that uses a marketing strategy with an overall objective of maximized financial performance. This strategy is driven by seven customer-level marketing tactics and shows how actual customer data can be used to generate an actionable marketing strategy leading to optimal levels of profitability, customer equity, and shareholder value. In addition, the authors discuss a successful implementation of this strategy for several business-to-business and business-to-consumer firms and offer insights as to how to customize an implementation strategy for any firm, along with presenting potential challenges a firm may encounter during the implementation process. Several suggestions for future research are offered to explore and harness this newly available evidence. V. Kumar (VK) (vk@business.uconn.edu) is the ING Chair Professor of Marketing and the executive director of the ING Center for Financial Services at the University of Connecticut. He spends his time by transferring his knowledge (however little it may be) to his two daughters about customer lifetime value, diffusion models, forecasting sales and market share, retailing, and marketing strategy. J. Andrew Petersen (apetersen@business.uconn.edu) is a doctoral candidate in marketing at the University of Connecticut. His research interests include customer lifetime value, word-of-mouth effects, and customer-level marketing strategy. His research has been published inMarketing Research Magazine and theJournal of the Academy of Marketing Science.     

An empirical study of innate consumer innovativeness,personal characteristics,and new-product adoption behavior

This article explores the relationships between innate consumer innovativeness, personal characteristics, and new-product adoption behavior. To do this, the authors analyze cross-sectional data from a household panel using a structural equation modeling approach. They also test for potential moderating effects using a two-stage least square estimation procedure. They find that the personal characteristics of age and income are stronger predictors of new-product ownership in the consumer electronics category than innate consumer innovativeness as a generalized personality trait. The authors also find that personal characteristics neither influence innate consumer innovativeness nor moderate the relationship between innate consumer innovativeness and new-product adoption behavior. Subin Im is currently an assistant professor of marketing at San Francisco State University. His primary scholarly interest includes the organizational aspects of innovation, new-product development for marketing strategy, the consumer side of the innovation adoption process, organizational learning in new-product development, moral hazard and adverse selection model, and research methodology using multivariate statistical techniques. His current research projects include creativity in new-product development, market orientation and innovation, consumer innovativeness, entrepreneurship and organizational learning in new-product development, the development of the creativity measure, the validation of the innovativeness measure, and the testing of nonlinear effects in structural equation modeling. He received his Ph.D. from the University of North Carolina at Chapel Hill. Subin worked in banking and semiconductor industries before he joined academia. Barry L. Bayus is a professor of marketing in the University of North Carolina's (UNC) Kenan-Flagler Business School. Prior to joining the marketing faculty at UNC, Barry worked in both industry and academia. He has also served as an expert witness in patent infringement cases involving high-tech products. His teaching and research interests are in the areas of new-product design and development, marketing analysis and strategy, and technological change. His recent research is concerned with the creation and evolution of new markets and the historical evolution of products, as well as new-product development issues such as speed to market, product life-cycle management, new-product preannouncements, product proliferation, firm entry, and exit timing in dynamically changing markets. Charlotte H. Mason is an associate professor of marketing in the University of North Carolina's Kenan-Flagler Business School, where she leads the MBA Customer and Product Management concentration. Her industry experience includes work for Procter & Gamble, Booz, Allen and Hamilton, as well as consulting projects. Her research focuses on the development and testing of marketing models and applications of multivariate statistics to marketing problems. She is currently investigating issues relating to the analysis and use of large customer databases as well as strategic issues surrounding customer portfolio management. Her research has been published inMarketing Science, theJournal of Marketing Research, theJournal of Consumer Research, Marketing Letters, theJournal of the Academy of Marketing Science, and theJournal of Business Research. She is on the review boards of theJournal of Marketing Research and theJournal of the Academy of Marketign Science and is coauthor (with William Perreault) ofThe Marketing Game!, a strategic marketing simulation.     

Market valuation models of the effect of advertising and promotional spending: A review and meta-analysis

A narrative review is presented, within the organizing framework of a meta-analysis, of econometric models reported in the business literature that estimate the effect of advertising and promotional spending on the market value of the firm. Results from published market valuation models are aggregated, and various model specifications are appraised. In brief the meta-analysis finds support for a positive relationship between levels of advertising and promotional spending and the market value of the firm. That is, marketing activities (represented here by observed advertising and promotions spending) are generally expected to deliver future cashflows and produce increases in shareholder wealth. The review seeks to enhance understanding among the community of marketing scholars of the properties of market valuation models published in the literature and serves as a springboard for ongoing investigation of a crucial question for marketing theory and practice. Margy P. Conchar (concharm@mail.ecu.edu) (Ph.D., University of Georgia) is an assistant professor at East Carolina University. Her research focuses on consumer behavior and advertising. Her work in consumer behavior concentrates on risk, motives, and optimal consumption experience. Her research in advertising focuses on the interface between advertising and finance, accounting, or economics. She has previously published in the proceedings of the Academy of Marketing Science, the Association for Consumer Research, the American Marketing Association of Educators, and the Society for Marketing Advances. Melvin R. Crask (mcrask@terry.uga.edu) (DBA, University of Indiana) is an associate professor of marketing at the University of Georgia (UGA). He is currently serving as director of the MBA program at UGA. His teaching interests are in the areas of marketing research and marketing strategy. He has published more than three dozen articles and papers dealing with marketing research methods and with strategic issues in marketing. He is also the coauthor of two books, one on marketing strategy and one on marketing research. George M. Zinkhan (gzinkhan@terry.uga.edu) (Ph.D., University of Michigan) is the Coca-Cola Company Chair of Marketing at the University of Georgia. His major research interests include advertising, communication, and e-commerce.     

Cross-functional working relationships in marketing

Conclusions Marketing managers spend a large part of their day interacting with superiors, subordinates, and peers from other functional units in the organization. To effectively serve as an advocate for the consumer at various levels of the hierarchy and across functions, the marketing manager must initiate, develop, nurture, and sustain a network of relationships with multiple constituencies within the firm. Special relationship skills are required in managing this cross-functional exchange network and in mobilizing support for a particular strategy course. Indeed, the reputational effectiveness of marketing managers (and of marketing units) rests on their ability to respond to the needs and demands of members of this internal exchange network. Because the needs of the involved constituent groups often conflict, a set of adaptive processes characterize exchange relations across functions. The central purpose of this commentary is to review promising conceptual perspectives and to suggest several lines of research that might deepen our understanding of the challenging interfunctional role that marketing managers assume in the firm. He received a Ph.D. in marketing from Michigan State University. He has coauthored three books, includingBusiness Marketing Management (The Dryden Press), now in its fifth edition. His research interests center on the process dimensions of business and marketing strategy formation. His research has been published in theJournal of Marketing, Journal of Marketing Research, Sloan Management Review, Journal of Retailing, and other publications.     

Pooled marketing: The challenge and the opportunity

The present situation is marketing is characterized by rising costs and increasing prices. In an article in Business Week, a commentator has stated that “...... marketing and distribution are where industry must make up a lot of the costs of doing business today” (13). Pooled marketing is a viable alternative to the marketing practices which have, along with inflation and other factors, contributed to the present situation. In addition to the cost savings that can emerge from pooling programs, the cooperative sharing of resources makes it possible to capitalize on opportunities that a firm would not have been able to seize on its own.     

基于动态环境背景的营销组合分析——创业营销组合与传统营销组合之差异

面对当前动荡复杂的营销环境,融合了创业导向和市场导向的创业营销(Entrepreneurial Market-ing)表现出了更具灵活性和适应性的优势。本文在回顾了创业营销和创业营销组合基本理论的基础上,从不同营销组合产生的环境背景角度分析了创业营销组合与传统营销组合的差异。除了环境背景不同之外,还识别了二者在对市场的反应速度、对环境中风险的容忍程度和对资源的利用方式上存在的显著差异。     

Dynamic relationships among R&D,advertising, inventory and firm performance

Firms’ spending on R&D, advertising, and inventory holding affect firm performance, which in turn affects future spending in each of these three areas. Effective allocation of resources across R&D, advertising, and inventory holding is challenging since an understanding of their dynamic inter-relationships is necessary. Past research has not examined these spending issues simultaneously. We estimate inter-relationships among the effects of firms’ R&D spending, advertising spending, and inventory holding on sales and firm value (as measured by its Tobin’s Q) using a vector auto regression model of a panel of publicly listed U.S. high technology manufacturing firms. Insights from the computation of long-term effects indicate that advertising spending and inventory holding increase sales, while R&D spending does not, and advertising and R&D spending increase firm value, while inventory holding does not. In addition, firm spending in all three functions is positively affected by sales but negatively by firm value. We discuss the implications of the study for marketing literature and managerial practice.     

Gender,income differences,and marketing: Examining the “earnings gap” in three areas of marketing

This research explores empirically a socioeconomic/equity issue that has been extensively investigated in many areas, but never marketing—the so-called “earnings gap.” Specifically, the study investigates income differences between men and women in marketing, while controlling for differences in business experience, level of education, corporate level, type of industry, and size of firm. The research focuses on three areas in marketing: (1) marketing management, (2) marketing research, and (3) advertising agency management. Findings indicate that there is an “earnings gap” for marketers. Importantly, however, the data show that a substantial portion of the gap can be explained by variables other than sex.     

Selecting research firms from which to get proposals

Many marketing research firms are incompetent or transient. It is difficult for the inexperienced buyer of marketing research to know how to make a choice. One factor that should be considered is the nature of the problem; understanding your own needs helps to spell out some of the characteristics to look for in a research firm. Locating names of research firms can be done from reviewing available lists, and from informed sources. Evaluation of the firms is difficult. The potential buyer should attempt to estimate the competency of the firm (in questionnaire development, statistical design, field work, coding and editing, and data processing). The buyer should also try to evaluate the research imagination of the firm, for creativity may add value to the study. Integrity is another important aspect, since this affects whether your marketing secrets are kept, and whether or not a good study is done. Practicality is a highly important standard; this is reflected in location, meeting of deadlines, flexibility, speed, personal relations, and pricing policies. Sources of information for obtaining the necessary information include material from the research firm being considered, a planned visit to the firm’s headquarters, customers of the research firm, and general reputation (among both users and nonusers of the firm).     

Creating a firm-level dynamic capability through capitalizing on market orientation and innovativeness

Drawing on the resource-based view of the firm, this study addresses the dynamic capability-generating capacity of market orientation on firm performance. Whereas prior literature has examined environmental turbulence as a contextual condition shaping the market orientation-firm performance relationship, this study takes an internal approach by focusing on existing stocks of resources within the firm while controlling for environmental conditions. A conceptual model is developed that explains how market orientation can be transformed into dynamic capability when complemented by transformational (reconfig-urational) constructs, such as innovativeness. The empirical results support the authors— theory that the effect of market orientation on firm performance is strengthened when market orientation is bundled together with internal complementary resources, such as innovativeness. The authors discuss the findings in the context of varying stages of the product life cycle and at different levels of market development. Bulent Menguc (menguc@brocku.ca), Ph.D., Marmara University, is currently an associate professor of marketing at Brock University, St. Catharines, Canada. His areas of research interest include sales force management and internal marketing, strategic orientations, and cross-cultural research methodology. His research has appeared in theJournal of the Academy of Marketing Science, theJournal of Retailing, theInternational Journal of Research in Marketing, theJournal of Business Research, theJournal of Personal Selling and Sales Management, Industrial Marketing Management, theJournal of Business Ethics, and theEuropean Journal of Marketing, among others. Seigyoung Auh (sauh@yonsei.ac.kr), Ph.D., University of Michigan, is an assistant professor at Yonsei University, South Korea. His research interests are the application of the resource-based view to marketing strategy, the role of top management teams on marketing strategy, and innovation and organizational learning. He has publications in theJournal of the Academy of Marketing Science, theInternational Journal of Research in Marketing, theJournal of Business Research, Industrial Marketing Management, and theJournal of Economic Psychology, among others.     

Overcoming the “recency trap” in customer relationship management

Purchase likelihood typically declines as the length of time since the customer’s previous purchase (“recency”) increases. As a result, firms face a “recency trap,” whereby recency increases for customers who do not purchase in a given period, making it even less likely they will purchase in the next period. Eventually the customer is effectively lost to the firm. We develop and illustrate a modeling approach to target a firm’s marketing efforts, keeping in mind the customer’s recency state. This requires an empirical model that predicts purchase likelihood as a function of recency and marketing, and a dynamic optimization that prescribes the most profitable way to target customers. In our application we find that customers’ purchase likelihoods as well as response to marketing depend on recency. These results are used to show that the targeting of email and direct mail should depend on the customer’s recency and that the optimal decision policy enables the average high recency customer, who currently is virtually worthless to the firm, to become profitable.     

The client as consumer: Marketing the law,clinic-style

In 1977 the Supreme Court ruled that lawyers could not be prevented from advertising their prices for routine services, thus outlawing a long standing restriction imposed by the legal profession on its own members. This decision prompted a ferocious controversy (even for lawyers) over the proprieties of advertising legal services, not to mention the effect that “marketplace ethics” might wield on the delivery pricing, and quality of services offered to the great lay public. This article looks at how legal consumers are affected by the kind of high-volume, low-priced delivery of routine services that can only be offered profitably through aggressive marketing. Then it discusses how one firm used segmentation strategy and a consumer orientation to introduce the clinic concept on the East Coast. Finally, some implications of the immediate future of lawyer marketing for marketing professionals are analyzed.     

The influence of complementarity, compatibility, and relationship capital on alliance performance

Value creation through alliances requires the simultaneous pursuit of partners with similar characteristics on certain dimensions and different characteristics on other dimensions. Partnering firms need to have different resource and capability profiles yet share similarities in their social institutions. In this article, the authors empirically examine the impact of partner characteristics on the performance of alliances. In particular, they test hypotheses related to both direct impact of partner characteristics on alliance performance and indirect effects through relational capital aspects of the alliance. Empirical results based on a sample of alliances in the global construction contracting industry suggest that complementarity in partner resources and compatibility in cultural and operational norms have different direct and indirect effects on alliance performance. Accordingly, organizational routines aimed at partner selection need to be complemented by relationship management routines to maximize the potential benefits from an alliance. MB Sarkar (Ph.D., Michigan State University) is an assistant professor of marketing at the University of Central Florida. His current research includes strategic alliances, innovation and entrepreneurship, knowledge management, and electronic markets. His research has been published in theStrategic Management Journal, theJournal of International Business Studies, and theJournal of Business Research, among others. Raj Echambadi (Ph.D., University of Houston) is an assistant professor of marketing at the University of Central Florida. His current research interests include investigation of territorial loyalty issues, management of innovations, and estimation issues pertaining to structural equation modeling and Partial Least Squares. His research has been published in theStrategic Management Journal, Multivariate Behavioral Research, and theJournal of Product Innovation Management. S. Tamer Cavusgil (Ph.D., University of Wisconsin) is University Distinguished Faculty and serves as the John William Byington Endowed Chair in global marketing at Michigan State University (MSU). He is also the executive director of MSU's Center for International Business Education and Research, a national resource center. His teaching, research, and administrative activities have focused on international business and marketing. His research has been published in theJournal of Marketing, theJournal of Marketing Research, and theJournal of International Business Studies, among others. His specific interests include the internationalization of the firm, global marketing strategy, and internationalization of business education. He was the founding editor of theJournal of International Marketing, now published by the American Marketing Association. Preet S. Aulakh (Ph.D., University of Texas at Austin) is an associate professor of strategy and international business at the Fox School of Business and Management, Temple University. His research focuses on international technology licensing, cross-border joint ventures and strategic alliances and strategies of firms from developing economies. His research has been published in theAcademy of Management Journal, theJournal of Marketing, and theJournal of International Business Studies.     

On the role of the RBV in marketing

This short note contains some reflections on the relationship between the resource-based view of the firm (RBV) and marketing. I focus on the main proposition of the RBV—that a firm should focus on what it can do better than others—and argue that it has implications for almost all marketing activities and that much thinking in the field already is consistent with it.     

Relationship marketing of services—growing interest,emerging perspectives

Relationship marketing is an old idea but a new focus now at the forefront of services marketing practice and academic research. The impetus for its development has come from the maturing of services marketing with the emphasis on quality, increased recognition of potential benefits for the firm and the customer, and technological advances. Accelerating interest and active research are extending the concept to incorporate newer, more sophisticated viewpoints. Emerging perspectives explored here include targeting profitable customers, using the strongest possible strategies for customer bonding, marketing to employees and other stakeholders, and building trust as a marketing tool. Although relationship marketing is developing, more research is needed before it reaches maturity. A baker’s dozen of researchable questions suggests some future directions. holds the J. C. Penney Chair of Retailing Studies, is a professor of Marketing, and is director of the Center for Retailing Studies at Texas A&M University. He is a former national president of the American Marketing Association. His research interests are services marketing, service quality, and retailing strategy. He has published numerous journal articles and books, includingDelivering Quality Service: Balancing Customer Perceptions and Expectations (Free Press, 1990),Marketing Services: Competing Through Quality (Free Press, 1991), andOn Great Service: A Framework for Action (Free Press, 1995).     

A note on cultural consistency within the service firm: The effects of employee position on attitudes toward marketing culture

This study represents the beginning of an exploration of the internal constraints and barriers that stand in the way of successful strategy implementation within service organizations. A determination will be made if one of the internal constraints is perhaps the lack of consistency among employees regarding marketing practices, attitudes, values, norms, and ideals. Specifically, service firm employees’ attitudes toward their actual and ideal marketing culture were measured. Attitudinal differences were examined between ground-level, middle-, and top-management employees from a cross-section of service industries. Significant differences were found for a variety of marketing culture components. Many of the differences remained even after removing possible effects of number of employees in the firm and age of the firm. Managerial implications are given.