Driving Shareholder Value: The Role of Marketing in Reducing Vulnerability and Volatility of Cash Flows

Marketing professionals have historically found it difficultto measure and communicate to other disciplines and to top managementthe value created by marketing activities. All too often, justificationof marketing and communication initiatives is restricted to theirimpact on revenue generation. But, marketers do create valuein other ways. Marketing actions do lead to an acceleration ofthe market's acceptance of new products, to enhanced customerretention/loyalty, to an improvement in the size and qualityof customer bases, to price premiums and other desirable payoffs.Such financial outcomes suggest that marketing activities areoften strategic investments, not tactical, intangible expenses.We suggest that the effectiveness of marketinginitiatives should be evaluated on the basis of their impacton the basic drivers of shareholder value–cash flow acceleration,cash flow enhancement, reduction in volatility and vulnerabilityof cash flows, and growth in the long-term value of business).These shareholder value metrics provide a framework for communicationof the contribution of marketing strategies to value creation.In particular, this paper focuses on the role of marketing inenhancing shareholder value by reducing the vulnerability andvolatility (hence risks) associated with cash flows. This riskreduction (and shareholder value creation) role of marketingactivities is examined within cross-functional processes forcreating customer value such as design of new products and services,supply chain management and management of relationships withcustomers, channels and strategic partners.     

An empirical study of the international marketing strategies of e‐commerce companies

This study surveyed a random sample of 136 e‐commerce companies to provide baseline information about their marketing and international marketing strategies. The findings show that one in five companies do not market internationally and another four in ten generate 10% or less of their sales from international markets. About half of the companies reporting international sales did not adapt their strategies to the international markets. This may have contributed to the failure of many of these companies. A more savvy use of international marketing strategies by e‐commerce companies could be very helpful to their future well‐being. © 2005 Wiley Periodicals, Inc.     

互联网时代的口碑营销及应用策略

口碑营销是近年来企业进行营销传播的常用营销策略之一.互联网的出现使得消费者的口碑传播行为呈现出新的特点,同时为企业进行口碑营销活动提供了新的机会,因此,研究互联网时代的口碑营销具有一定的理论与实践意义.本文首先阐述了网上口碑传播的内涵,指出了网上口碑传播的途径,然后论证了网上口碑传播的特点.以此为基础,探讨了企业开展网络口碑营销的应用策略.     

期货经纪公司差异化营销策略的实施

我国期货市场日益激烈的同质化竞争,客观上要求期货经纪公司实施差异化营销策略,就此,从竞争手段差别化和服务差别化两个大的方面,论述了期货经纪公司在现实条件下如何实施差异化营销的措施。     

How nonfungible tokens empower business model innovation

Nonfungible tokens (NFTs) have experienced exponential growth over the past few years. Many companies and creators have experimented with various ways to develop NFT businesses, but often without clear guidance on how NFTs shape property rights and business models. In this article, we examine the roles of NFTs in establishing digital property rights, creating value for creators and collectors, and empowering business model innovation. As NFTs unlock digital property rights, they can spawn new business models centered around digital ownership, portable and composable digital assets, and decentralized communities. We believe our framework can help businesses and creators formulate and implement actionable strategies to create and capture value in NFTs and Web3.     

服务企业全球营销战略内部驱动因素实证研究——以我国高端服务企业的实证检验为例

文章通过对全球服务营销战略表现及其内部驱动因素测度指标的设定,检验了它们之间的关系,发掘了对全球服务营销战略表现起重要作用的各个内部驱动因素及其在重要性上的差异度,为我国服务企业在全球化进程中,应抓住哪些关键性的全球营销战略内部驱动因素,更好地发挥各个内部驱动因素的作用提供了理论依据。文章还提出了一些培育、构建这些内部驱动因素的理论建议。     

Strategic consequences of self-service technology evaluations

This article develops a conceptual model of self-service technology (SST) evaluations on customer-centric (loyalty, trust, and word of mouth) and firm-centric (profitability and enterprise value) strategic consequences to guide future research and help practitioners better understand the potential benefits and risks associated with satisfied (dissatisfied) SST customers. An SST evaluation is a post-use assessment of service quality and performance perceptions during an SST service encounter. This article synthesizes prior research to develop generalizations about conceptual relationships with and among the outcomes of SST evaluations. Iterative positive (negative) SST encounters cumulatively improve (diminish) customer relationships and the marketer’s financial success. Given the phenomenal rise and anticipated growth in SST use, this model provides a much-needed framework to organize the emerging literature into a coherent structure that summarizes past research and guides new discoveries about the implications of SST service evaluations through a set of research propositions based in marketing theory.     

The marketing–finance interface: A new integrative review of metrics,methods, and findings and an agenda for future research

The marketing–finance interface is an important research field in marketing, helping demonstrate the accountability of marketing within companies and building a necessary interdisciplinary bridge to finance and accounting research. Since the first comprehensive review article by Srinivasan and Hanssens (2009), the marketing–finance field has broadened considerably, as has research in finance and accounting. This updated systematic review of extant and new research integrates research in marketing, finance, and accounting into an overarching marketing–finance research framework. We discuss new methodological developments and offer solutions to recent technical debates on the event-study method and Tobin's q. Motivated in part by a survey of marketing–finance researchers, the article identifies and synthesizes four key emerging research areas: digital marketing and firm value, tradeoffs between “doing good” and “doing well,” the mechanisms of firm-value effects, and feedback effects. The article closes with a future research agenda for this dynamic research field and offers key conclusions.     

Developing trends in the marketing of life insurance

The personal financial services industry is being changed drastically by a number of legislative and other measures. As a result, life assurance companies are having to reappraise their use of marketing methods in a highly competitive environment. This paper investigates the major industry marketing trends which are occurring particularly in the areas of advertising, distribution, new product development and price. The role of IT is highlighted.

The trends are set against a backcloth of an analysis of market penetration by a range of personal financial services products. The paper ends by outlining likely future trends in the use of marketing methods by assurance companies as part of their competitive strategies.

Data are presented from published sources and from a series of personal interviews with marketing executives in the industry.     

Marketing Strategy in an Internet-Enabled Environment: A Retrospective on the First Ten Years of JIM and a Prospective on the Next Ten Years

During the past decade, developments such as the rapid growth of the Internet, digitization of information products, and digitization of the information attributes of non-information products, has necessitated businesses to fundamentally rethink, as well as institute major changes in, their marketing strategies. Against this backdrop, we present a critical assessment of extant research on marketing strategy in an Internet-enabled environment viewed through the lens of research published in previous volumes of the Journal of Interactive Marketing (JIM), and speculate on the future of interactive marketing in the contexts of marketing practice, research in marketing and marketing education. Looking back, it is evident that marketing strategy and marketing operations have been transformed by the Internet in many ways. Looking ahead, it can be expected that marketing strategy and marketing operations will be even more extensively integrated and blended in the Internet-enabled market environment in the future.     

Valuation of brand equity and retailer growth strategies using real options

In marketing, significant attention has been devoted to the study of drivers and outcomes of strategic flexibility drawing on real options theory. However, research that quantifies the specific value of flexibility reflected in a bundle of strategic real options is lacking. To remedy this gap, we develop a real options-based framework that takes account of brand expansion and extension options to value brand equity and retailer growth strategies. We show how to value the bundle of strategic real options associated with a flexible marketing strategic vision and how to assess the growth strategies related to the corporate brand of an international retailer. We apply our method to estimating the brand equity of Starbucks both under growth and adversity conditions. The results reveal that our method can more reliably incorporate the growth potential of the brand under uncertainty conditions. Comparisons with other brand valuation approaches are discussed. Our study helps clarify the links among management’s strategic plans, brand-based marketing strategies and share price, and allows to better monitor the impact of retailer strategic choices on long-term brand equity value.     

Star power in the eye of the beholder: A study of the influence of stars in the movie industry

Organizations employ various risk-mitigation strategies to cope with the uncertainty in marketing new products. In the motion picture industry, an important strategy is to cast star actors and actresses in movies. The ultimate box-office success, however, depends on multiple stakeholders involved with financing, making, distributing, and watching the movie. In pursuing different goals and interests, the stakeholders may look for different aspects of star power to mitigate their own risk. This paper examines how the influence of stars varies across key stakeholders in the movie market. The results show that, in general, stars have a greater impact on the stakeholders involved in the earlier stages of movie development and exhibition (where the risks are greater) than on those in later stages. Movie project financiers and exhibitors are strongly and directly influenced by star power, but news media and movie audiences are influenced less and only indirectly. Situated at the early stage of the movie “value chain,” the financiers are most concerned with stars’ past box-office performance. Exhibitors, however, are influenced by the “match” between a star’s genre participation history and the genre of a specific movie. By contrast, news media and movie audiences are influenced indirectly through the stars’ impact on earlier stakeholders and their decisions. The findings shed light on the value of employing star elements in new products, the marketing of stars, and movie promotion strategies.     

We’re all connected: The power of the social media ecosystem

Consumers are adopting increasingly active roles in co-creating marketing content with companies and their respective brands. In turn, companies and organizations are looking to online social marketing programs and campaigns in an effort to reach consumers where they ‘live’ online. However, the challenge facing many companies is that although they recognize the need to be active in social media, they do not truly understand how to do it effectively, what performance indicators they should be measuring, and how they should measure them. Further, as companies develop social media strategies, platforms such as YouTube, Facebook, and Twitter are too often treated as stand-alone elements rather than part of an integrated system. This article offers a systematic way of understanding and conceptualizing online social media, as an ecosystem of related elements involving both digital and traditional media. We highlight a best-practice case study of an organization's successful efforts to leverage social media in reaching an important audience of young consumers. Then, we conclude with several insights and lessons related to the strategic integration of social media into a firm's marketing communications strategy.     

Integrating Customer Satisfaction into the Strategic Marketing Plan

Demanding ever-increasing quality and value, consumers are having major impact on organizations. Ideally, marketing should be at the forefront of organizational change because of this new orientation to customer satisfaction. Marketing can increase its contribution to the organization to the extent it is able to integrate customer satisfaction into the strategic marketing plan. Manufactured products and delivered services generally arise from a need. As long as that need exists and it is fulfilled, the life of the business that procedures that product or service continues. Many businesses have faltered or even disappeared because they did not consistently keep customer needs, expectations, perceptions and attitudes as their first priorities in decision-making and planning. In a changing marketplace, focusing on customer satisfaction ensures a solid foundation on which continued growth and success can be built. This article presents a summary of the key concepts gathered from a review of recent literature on the customer satisfaction process. Examples are offered to illustrate that companies are integrating customer satisfaction to increase their competitive advantage. Finally, the article provides a framework for integrating customer satisfaction into the strategic marketing plan.     

Will the frog change into a prince? Predicting future customer profitability

More and more companies have customer databases that enable them to analyze customer profitability over time. These companies often seek to determine the most important customers as indicated by their current or historical profitability and focus attention on them. Focusing on profitable customers can result in more efficient use of marketing resources, but this approach neglects the fact that customers can evolve over time. Some customers begin as low-profit customers but eventually develop into high-profit customers. Others may start out as high-profit customers but become unprofitable over time. Previous efforts to predict future profitability have been relatively unsuccessful, with relatively simple, naïve models often performing just as well as or better than more sophisticated ones. Our paper presents a new approach to predicting customer profitability in future periods that performs significantly better than naïve models. We estimate the models on data from a high-tech company in a business-to-business context and validate the models' predictive ability on a holdout sample.We show that a model based on simulation of customer futures provides large improvements over naïve extrapolation of average profits. By using the simulation model to select customers, ROI from marketing efforts is projected to increase by 58%.     

Innovation's Second Step

Innovative companies often place their emphasis on invention, research, and new product development, even as they neglect the process of bringing products to the marketplace in a way that is advantageous over the long term. Small to medium‐sized businesses that are scaling up are particularly vulnerable to entering into unfavorable distribution arrangements with large mass‐market retailers. Often, managers assume their firm will automatically benefit from a technological or creative breakthrough. Rather than focusing solely on new innovations and viewing distribution as an afterthought, we suggest that innovative firms make channel management a priority as their products are discovered and they attempt to reach more customers. In this article, strategies are offered as paths managers should consider as they use their innovations to scale up from small or medium‐sized firms into large companies. Steps for implementation as well as concurrent risks are also presented. © 2014 Wiley Periodicals, Inc.     

An examination of the relationship among consumer lifestyles,ethnocentrism, knowledge structures,attitudes and behavioural tendencies: a comparative study in two CIS states

The objective of this study is to investigate ethnocentric and/or regiocentric behaviour of Azeri and Kyrgyz consumers. In particular, the study focuses on how ethnocentrism explains consumers' attitudes, intentions and actual purchasing behaviour towards products from major sourcing countries. Data for the study were collected through personal interviews in four districts of Greater Bishkek: the capital city of Kyrgyz Republic, and Baku, the capital city of Azerbaijan. Survey findings lend greater support to earlier studies conducted in the USA, Western and Eastern Europe and Japan. Non-ethnocentric Kyrgyz and Azeri consumers have significantly more favourable belief structures, attitudes, intentions and the resultant purchasing behaviour regarding imported products compared to their ethnocentric Azeri and Kyrgyz consumer counterparts. The findings of the study offer important research, public policy and managerial implications for companies, government agencies and international donor agencies alike who are either operating in the region or contemplating an entry in the future. Foreign companies may use pan-regional marketing strategies and may be able to standardise their products and marketing strategies in the region, since consumers have identical and/or very similar use behaviour and uses for the products and services.     

Differentiation through Service: A Perspective from the Commodity Chemicals Sector

This article examines the role of service as a differentiating factor in the marketing of commodity chemicals. The commodity chemicals sector is characterised by high volume products that are fundamentally undifferentiable by product characteristics, made to an industrial standard often produced with a technology that is common amongst competing producers, with high exit cost due as a result of extensive capital investment. In addition many segments of the market exhibit excess supply over demand. The research, based on an empirical study of companies in the sector and their supply chain relationships, suggests that service and relationship management are key strategies used by companies to escape the commodity trap and gain competitive advantage. The results of the study are discussed in the context of the services marketing continuum and using the servitisation model. The implications of the findings are that, if firms in this sector wish to break out of the commodity trap of blind allegiance to cost leadership as a generic strategy, then they must seek methods of differentiation. The article concludes that a servitisation strategy placed in the context of relationship management can be a means of creating differentiation advantage in a traditionally cost orientated sector     

Turning a liability into an asset of foreignness: Managing informal networks in Korea

Although foreignness can bring both benefits and costs to a business, much of the literature has focused on the liability of foreignness (LOF), while relatively little attention has been paid to the positive side. Despite the presence of LOFs, foreign companies may accrue some unique advantages from their foreign status, which are referred to as assets of foreignness (AOFs). Drawing upon social-capital theory and institutional theory, this article examines the issue of LOFs versus AOFs in the context of the informal networks in Korea and explores how foreign companies can manage their weaknesses in host-country-specific informal networks to create value from their foreignness. We discuss two practical strategies, reactive and proactive strategies, that can be used by foreign companies. While these two strategies can be pursued in parallel, this article suggests that foreign companies should prioritize pursuing proactive strategies. This article contributes to a more nuanced understanding of the role of foreignness in the international business context and provides practical insights into how foreign companies can leverage their foreign status in developing their own informal networks in Korea.