The mode of exchange and shaping of markets: Distributor influence in the Swedish post-war food industry

This paper addresses the associations between the mode of exchange and the configuration of market actors and exchange objects through a historical case study of the introduction of self-service retailing in the private food retail trade in Sweden. The changes in the mode of exchange reported in the case resulted from organizing efforts involving both retailers and a major wholesaler. These efforts were directed towards two main areas: the material framing of the exchange situation, e.g. the redesign of store facilities, interiors and the pre-packaging of goods, and the agency of the involved actors, e.g. information campaigns and education directed towards retailers and consumers. Through this process, a network of associations was forged that inter-defined the mode of exchange, the market actors and the exchange objects. The paper contributes to extant literature on the shaping of markets by empirically examining the associations constituting modes of exchange and the process through which these associations are forged. A central finding is that the introduction of self-service was elaborately intertwined with changes in the characteristics of the actors and objects of exchange.     

Constructing and contesting markets through the market object

This paper focuses on the work that market actors undertake in order to stabilize and de-stabilize market objects. We briefly revisit Igor Ansoff's classic product–market strategy matrix to show how marketing management literature typically equates stability in markets with commodification and inertia. To escape this inertia, marketers often ‘warm up’ or destabilize existing market objects by changing the material bases of the object, for instance in incremental product development. But this ‘warming up’ invites other market actors to also question or destabilize the networks that are supposed to hold the market object in its new (market) space. We utilize archival research to trace one case each of market and product development within the pharmaceutical realm, demonstrating: first, the effort market actors put into ‘cooling down’ and ‘warming up’ market objects; second, how contested such efforts can be; and third, how the object's material attachments may limit its symbolic malleability.     

Stabilizing food markets in eastern and southern Africa

A major challenge for agricultural policy in Africa is how to address the market instability-related causes of low farm productivity and food insecurity. This paper highlights structural changes affecting the behavior of food markets in eastern and southern Africa and discusses their implications for the design of strategies to stabilize food prices. These changes include (1) an increasing trend in maize prices toward import parity levels, reflecting an emerging structural maize deficit in much of the region; (2) increasingly diversified food consumption patterns in both rural and urban areas; (3) highly concentrated marketed maize surplus, which have largely unrecognized implications for the magnitude of price risk faced by most farm households; and (4) the strategic interactions between private and public marketing actors leading in some cases to heightened market instability and food crises. In the prevailing dual market environment now characterizing most of the region, greater coordination, transparency, and consultation between private and public market actors is needed to achieve reasonable levels of food price stability and predictability.     

Demand for coffee in Sweden: The role of prices, preferences and market power

There is a widespread belief that consumer coffee prices are high relative to bean prices and that lower consumer prices would lead to substantial increases in bean exports from Third-World countries. This issue is evaluated by analysing how retail prices, preferences and market power influence coffee demand in Sweden. A demand function is estimated for the period 1968–2002 and used, together with information on import prices of coffee beans, to simulate an oligopoly model. This approach gives estimates of the maximum average degree of market power and shows how coffee demand would react to reductions in marginal cost to its minimum level. The maximum level of market power is found to be low, but it generates large spreads between consumer and bean prices because the price elasticity has low absolute values. Moreover, the impact of a price decrease would be small because long-run coffee demand is dominated by changes in the population structure in combination with different preferences across age groups. Hence, a change to perfect competition would only have a negligible effect on bean imports.     

The impact of market orientation on the development of relational capabilities and performance outcomes: The case of Russian industrial firms

The article investigates the role of market orientation as an antecedent for the development of relational capabilities and performance in Russian industrial firms. We test the direct role of different aspects of market orientation on business performance in comparison to an indirect and mediated influence via improving a firm's ability to become embedded in relational structures. The results of an empirical study demonstrate the differential impact of components of market orientation - customer orientation, competitor orientation, and interfunctional coordination - as direct and indirect antecedents of relational capabilities and thus subsequently of overall firm performance. It can be shown that in Russian industrial markets competitor orientation directly and positively impacts on performance, while the other two components of market orientation have only a mediated effect on performance via the development of relational capabilities.     

Wholesale market definition in telecommunications: The issue of wholesale broadband access

The scope of a wholesale market may, in addition to demand- and supply-side substitution at the wholesale level, also be determined by substitution patterns at the retail level. Considering wholesale broadband access markets, it is argued that each of these forces can be strong enough to render a 5–10% price increase by a hypothetical monopolist at the wholesale level unprofitable and thus may lead to a wider wholesale market definition including, for example, cable networks in addition to DSL. Based on the theory of derived demand elasticities the paper discusses under which circumstances this could be the case. The position of the European Commission and the practice of national regulatory authorities are then reviewed in light of these arguments.     

Segmenting a market in the making: Industrial market segmentation as construction

This paper takes an empirical starting point in a claim that Biacore, a pioneering Swedish producer of affinity biosensors, was “in the enviable position of creating its own market” (Abelin, 1997). An in-depth case study traces how Biacore undertook segmentation activities while shaping the market for its new product technology, affinity biosensors. This involved stabilising the modes of exchange with customers, the product and the identity of the company. The efforts of Biacore highlight a constructive dimension of market segmentation that hitherto has received little attention. Rather than a process of describing, deciding and taking action, Biacore engaged in the gradual construction of market segments through an interactive and iterative process involving close collaboration with early users. Simultaneously, the market for the new technology gained shaped. Thus, the paper reports a ‘markets from networks’ story illustrating how the practice of segmenting a market may have consequences for that market.     

Urban cassava markets: The impact of fresh root storage

The authors explain how although fresh cassava is important in rural nutrition, its importance in urban areas is limited and declining. In Colombia, the third most important cassava-producing country in Latin America, both the structure of the marketing channel and consumer preferences are considered in explaining this difference. The principal factor limiting urban market volume and demand is identified as the rapid root post-harvest deterioration which necessitates high margins to cover marketing risks. Appropriate storage techniques which overcome this problem are evaluated and their possible positive impact, through reduction of marketing margins, on retail and farmgate prices and on urban consumption is estimated. A strategy for storage technology adoption is discussed.     

Product price and performance level in one market or two separated markets under various cost structures and functions

Market characteristics, including intrinsic demand and customer sensitivity on price and product performance level, are distinct at different markets. Comparisons of various product development strategies in one market or two geographically separated markets are conducted for three classes of products: development intensive products (DIPs) with constant unit cost, marginal cost-intensive products (MIPs) with constant fixed cost, and marginal and development intensive products (MDIPs) with non-constant unit cost and fixed cost. Results show that larger demand size, less customer sensitivity on price and/or more sensitivity on performance level lead to more profit, a higher sale price and a not-lower product performance. The customer reservation or the saturation performance level should be generally adopted though the optimal performance level does exist occasionally. Unit cost and/or fixed cost must increase in performance at an increasing rate for the existence of one optimal performance level. Due to the impact of demand size, one high-end (low-end) MDIP or DIP could be introduced into one low-end (high-end) market at a different price if the demand size is significantly large in the low-end market. For DIPs, offering one niche high-end product is not worse than offering the low-end product into two markets. For MIPs with negligible fixed cost, the product line strategy is not worse than the standard product development strategy. Additionally, the product cost reduction approach adopted in one product line has significant effects on the best product development strategy and sequence.     

Biofuels and the poor: Global impact pathways of biofuels on agricultural markets

This study seeks to assess the future impacts of biofuel production on regional agricultural and related sectors over the next decade with a specific focus on the vulnerable regions of developing nations. Using a modification of the GTAP modeling platform to account for the global interactions of regional biofuel and food markets, the analysis shows that biofuel production levels depend on the assumption about the future price of energy and the nature of the substitutability between biofuels and petroleum-based transport fuels. Low energy prices reduce the demand for biofuels and thus require greater government support to meet the desired production targets. At the other extreme, when prices are high and there is scope for substituting biofuels for petroleum-based fuels, the volume of biofuels produced will exceed the mandates. Even when biofuels are being mainly produced in developed countries, our results indicate that there are impact pathways that extend far beyond the borders of the US, Brazil and the EU. Prices of feedstock and non-feedstock commodities rise in developing countries. There is also a rise in value added from the agricultural sector—a gain that is enjoyed by the owners of land and labor, including unskilled. Hence, to the extent that agriculture is a key sector in getting growth started and addressing poverty needs, the emergence of biofuels can (in this way at least) be a positive force.     

Technological and geographic heterogeneity in broadband markets: The challenge for regulation

When the telecommunications industry was liberalised in Europe and North America in the 1980s and 1990s, it inherited a legacy of monopoly providers whose footprint was national or multi-regional in its character. The regulatory framework, particularly that adopted in EU member states, reflected this pattern of relatively homogeneous deployment achieved, in part, by decades of cross-subsidised pricing and universal service goals. Perhaps because of this legacy, telecommunications regulators have often adopted the presumption that relevant markets are national in character, unless proven otherwise Although geographically-variegated regulatory remedies have been permitted (even in the face of allegedly national relevant markets) and adopted in many member states, many regulators have never done so, and overly cautious thresholds for permitting geographically based forbearance suggest a continued bias towards presuming national markets and remedies. We find that this presumption of uniformity and the tendency to aggregate geographic markets together is not supported by first principles of antitrust analysis, although there may have been strong practical reasons to apply this presumption in the past circumstances of the telecommunications and broadband industries.On the ground, however, there has arguably never been as much heterogeneity across geographies and across technological solutions that provide effective ultra-fast broadband speeds. Both technological (i.e., product market) and geographic heterogeneity are likely to increase with the advent of mobile 5G networks. With their deployment, a cautious regulatory stance towards geographic variation and a cautious regulatory stance towards inter-technology or inter-modal competition may result in regulation that could exceed what is required to ensure effective competition and could instead distort the incentives to enter of facilities-based actors. This may also result in higher-cost and inefficient investment. A more geographically varied and technologically agnostic regulatory framework may satisfy the principle of proportionate and focused regulation—with the possibility that the locus of regulation shifts from the access network to bottleneck facilities such as fibre, ducts and poles.This discussion is especially germane when one considers the highly speculative nature of forecasts and projections about future demand, and the competing claims of proponents of 5G and fibre. While there is some scepticism about the performance of mobile networks, we note that pure mobile and fixed 5G services may have synergies in deployment, and that the idea of competing with residential broadband services is a core strategy of very influential large-scale industry actors. In terms of a future research agenda, regulatory decisions could benefit from much more research into the relationship between domestic and global bandwidth constraints and their influence on development of software and application, as well as much more quantitative research by academics on the drivers of bandwidth demand. The risks associated with promoting investment that results in large-scale wasted resources should also be central to the regulatory agenda.     

Regulating prices in two-sided markets: The waterbed experience in mobile telephony

The distinguishing feature of two-sided markets is that the pricing structure, that is, the relative prices charged to each side, matters. Regulators need to understand and account for the interdependence of prices in both sides. Some interventions that lower the prices on one side can result in higher prices on the other side of such markets. This article reviews the recent literature analyzing this waterbed phenomenon in mobile telephony and draws some more general lessons for policy interventions in two-sided markets.     

Wheat markets,food aid and food security in Afghanistan

In Afghanistan, after two decades of civil strife and successive droughts from 1998 to 2002, large inflows of food aid, distributed mainly to returning refugees and through food for work programs, have helped offset production shortfalls of wheat, the country’s major staple. At the same time, private international trade from neighboring countries, especially Pakistan, has also played a major role in augmenting wheat supply and stabilizing prices.     

Firm innovativeness and business performance: The joint moderating effects of market turbulence and competition

To clarify the nature of the effect of firm innovativeness on business performance, this study draws on contingency theory and an interactional perspective to develop a conceptual framework to investigate how the interaction between market turbulence and competitive intensity moderates the relationship between firm innovativeness and business performance. This study used survey data from a sample of 154 high-tech manufacturing firms in Taiwan and employed hierarchical moderated regression analysis to test the hypotheses developed. The results reveal that the effect of firm innovativeness on business performance varies across the different configurations of market turbulence and competitive intensity. Specifically, the performance effect of firm innovativeness is most positive under high market turbulence and high competitive intensity; the performance effect is least positive under low market turbulence and low competitive intensity. However, the performance benefits of firm innovativeness fail to materialize under low market turbulence and high competitive intensity. Overall, these findings highlight that market turbulence and competition jointly influence the direction and strength of the performance effect of firm innovativeness. This study advances firm innovativeness research by identifying the configurational market conditions that augment or limit the value of firm innovativeness.     

Managers' perception of relationship management in heterogeneous markets

Relationship management holds many promises of becoming a new paradigm in marketing and management. However, the development of relationship marketing is still difficult to accomplish in heterogeneous markets, since different management practices are needed in markets ranging from homogenous segments of customers with the same preferences to customers with individual demands for customized services. This paper investigates managers' perceptions of relationship development in heterogeneous markets. Results from a survey of 135 branch bank managers show that they perceive that the more heterogeneous the market, the more difficult to achieve relationship development. The study also finds that more difficult relationship development leads branch managers to perceive a more centralized locus of realized strategy. This suggests that firm relationship development needs to focus more on customer orientation and that realized strategies need to be at a local level to support this.     

Market-driving versus market-driven: Divergent roles of market orientation in business relationships

This study focuses on market orientation (MO) and customer intimacy (CI) in business-to-business marketing. These are generally regarded as key success factors in marketing. The authors argue, however, that the relationship between MO and customer relationship has not been properly examined, nor has its dependence on a firm's strategic market posture been understood. A contingency framework is proposed to test the postulated relationships between the key constructs. Our results indicate a strong positive association between MO and CI. Furthermore, this linkage is clearly influenced by the market focus and business logic adopted. In managerial terms, business executives must carefully match the strategic posture of the firm, its MO, and customer relationship management (CRM). Our findings strongly support a contingency modeling approach in studying the factors underlying marketing performance in business markets.     

Developing viable farmers markets in rural communities: An investigation of vendor performance using objective and subjective valuations

Farmers markets are drawing increasing attention by consumers as a local source of fresh foods; by producers as an alternative marketing opportunity to improve farm sales; and by policy makers concerned about the limited availability of affordable, nutritious foods in low-income, sparsely-populated rural areas. Using unique data collected from customers, vendors, and markets in a rural region of New York State, we develop an empirical model of subjective and objective measures of vendor performance to identify important factors for improved market sustainability. The empirical results suggest four inter-related planning recommendations when considering market and public policy interventions: (1) establishing larger, centrally located markets with public sector contributions, (2) targeting variety in products and vendors, (3) prioritizing attention to marketing and promotion, and (4) reducing cost burdens to underserved, low-income residents. As rural areas are spatially unique, future research across a variety of rural communities and regions will be important to the further development of sound initiatives aimed at improving market performance and access to healthy foods.     

ICT-based market information and adoption of agricultural seed technologies: Insights from Uganda

Access to ICT-based market information is crucial to the adoption of agricultural seed technologies for maize, beans and groundnut and to improve smallholder farmer yields and income. This ICT-based market information is provided by FM radio stations and by market information centers through media such as mobile phones and internet facilities, etc. Factors that positively affect the probability of access to ICT-based market information include access to microfinance loans, membership in a farmer association, government awareness campaigns, and wealth. Distance to the trading centers or district capital negatively affects this access. The likelihood of access to ICT-based market information declines with female-headed households. Access to market information has a positive and significant impact on the intensity of adopting improved seed for all crops. Adoption of improved seed has a positive and significant effect on farm yields and gross farm returns. This research shows that in order to generate meaningful improvements in food security and farm incomes, there must be commensurate efforts to promote ICT-based market information along with yield-augmenting agricultural seed technologies.     

Fertilizer market liberalization and private retail trade in Kenya

This paper examined the factors influencing the entry and sales decision of private traders in fertilizer retail trade in a liberalized market using survey data from Kenya. A two-stage econometric model is used to examine traders’ entry and sales decision. The results provide insights into factors that are associated with private retail traders’ entry and sales decisions in an era of liberalized fertilizer markets. It shows substantial entry into fertilizer retail trade following market liberalization. Relatively limited investments in trading assets and equipment are predicted to hold back firm expansion. Implications drawn from the study provide insights into likely research and policy interventions.