Theories of Marketing Final
Topic 1: Overview of development in marketing thinking
Marketing origins
• Narver & Slater (1990), The e ect of a market orientation on business pro tability.
• Slater & Narver (1998) Customer-led and market-oriented, let’s not confuse the two.
Current developments in marketing thinking
• Homburg et al. (2017), Customer experience management: toward implementing an evolving
marketing concept.
• Achrol, & Kotler (2022). Distributed marketing networks: The fourth industrial revolution.
Required pre knowledge about marketing strategy:
• Robert J. Dolan (2014), Marketing Reading: Framework for Marketing Strategy Formation.
P1 – p13 are mandatory for this course.
Topic 2: Consumer Insights & motivations
Consumer insights & value
• Laughlin (2014), Holistic customer insight as an engine of growth.
• Van den Driest et al. (2016). Building an insights engine.
Means-end chains in marketing
• Pai & Arnott (2013), User adoption of social networking sites: Eliciting uses and grati cations
through a means–end approach.
• Magids et al. (2015), The new science of customer emotions.
Topic 3: Value equity & innovation
Value perception & delivery
• Almquist et al. (2016), The Elements of Value Measuring—and delivering—what consumers really
want.
• Day (2011), Closing the Marketing Capabilities Gap.
• Lemon et al. (2001). What drives customer equity?
Value innovation
• Kim & Mauborgne (2005), Blue Ocean Strategy: from theory to practice.
• Burke et al. (2010), Blue Ocean vs. Five Forces.
Topic 4: Consumer behavior
Conceptual overview of behavior modi cation in marketing
• Nord & Peter (1980). A behavior modi cation perspective on marketing.
• Wells (2014), Behavioural psychology, marketing and consumer behaviour: a literature review
and future research agenda.
Focus on the sections:
‘Classical conditioning in marketing and consumer behaviour research’ and
‘Operant/instrumental conditioning in marketing and consumer behaviour research.’ Do not worry about the (endless) Tables
Contemporary applications of behavioral theories in marketing
• Gelbrich et al. (2017), Rewarding customers who keep a product: How reinforcement a ects
customers' product return decision in online retailing,
• Chen et al.(2011). Online social interactions: A natural experiment on word of mouth versus
observational learning.
1
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,Topic 5: Brand & relationship equity
Brand equity
• Dwivedi et al. (2010), Brand extension feedback e ects: a holistic framework.
• Hsu et al. (2016). Brand architecture strategy and rm value: how leveraging, separating, and
distancing the corporate brand a ects risk and returns.
Focus on the argumentation part about the di erences between the architecture options and the pro's and con's of each
(page 261-268) and the conclusion (page 276-278). Do not focus on the data and speci c outcomes.
Relationship equity and customer equity
• Watson et al.(2015), Building, measuring, and pro ting from customer loyalty Building.
• Hsieh et al. (2005), maintaining a committed online customer: A study across search-
experience-credence products.
• Silveira et al. (2017), Comparing alternative approaches to estimate customer equity.
Final: apply models to a case - very similar to the midterm!
2
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, Topic 1: Overview of development in marketing thinking
Article 1: Narver & Slater (1990), The e ect of a market orientation on business
pro tability.
Market Orientation is de ned as the organisational culture that most e ectively and e ciently
creates the necessary behaviours for the creation of superior value for buyers, and thus
continuous performance for the business.
They break it down into three behavioural components and two decision criteria:
Behavioural components:
1. Customer orientation
Understanding target buyers well enough to continuously create superior value for them. It
requires that the seller understands the buyer’s entire value chain, not only as it is today but also
as it will evolve overtime.
2. Competitor orientation
Understanding both the short-term strengths/weaknesses and long-term strategies and
capabilities of key-current and key-potential competitors.
3. Interfunctional coordination
The coordinated use of company resources in creating superior value for target customers. This
component emphasizes the need for all departments within the
rm (e.g., R&D, marketing, sales) to work together in a
coordinated way to deliver customer value. E ective
interfunctional coordination ensures that all parts of the
organization contribute to understanding and satisfying the
market’s needs, making the rm more agile and responsive.
Decision criteria:
1. Long term focus
2. Pro tability
In essence, a market-oriented business continuously gathers and
shares information about customers and competitors,
coordinates across functions, and uses this knowledge to deliver
superior long-term value, with pro tability as its ultimate goal
Commodity businesses sell physical products such as dimension lumber, ply wood, wood chips
and logs, all of which are essentially identical in quality and performance to those of competitors.
To create customer value, they usually rely on adding bene ts around the product (e.g., service,
delivery reliability) or reducing buyers’ non-price costs rather than altering the product itself.
Non-commodity businesses have more exibility to adapt
their generic product and add customer bene ts. Can
di erentiate their o erings through product features, design,
or customisation. Two types are in the sample:
1) Specialty products businesses (e.g. hardwood
cabinets, laminated doors)
2) Distribution businesses (merchant-wholesalers
within the corporation and sell to retailers,
contractors, and exporters)
For both the commodity and the non-commodity businesses,
Market Orientation is an important determinant of pro tability
3
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, (ROA). Among the non-commodity businesses, the relationship between Market Orientation and
pro tability was positive and monotonic. Whereas, in the commodity businesses, a positive
market orientation/pro tability relationship is found only among businesses that are above the
median in Market Orientation - the relationship is non-linear (U-shaped). They only gain if they
don’t engage in MO at all, or go “all in”, otherwise they become “stuck in the middle”:
- If a commodity rm does not invest in market orientation, it can still make pro t (ROA) if it’s
e cient, keeps costs low and competes on volume. Then a rm plays the pricing game.
- If a commodity rm invests a little in market orientation, costs rise, but because the product is
still basically the same as others, customers won’t pay more. This creates the dip in pro t (the
U shape): Higher costs, but no extra revenue = low ROA
- If a commodity rm heavily invests in market orientation (if it goes all in) it can create
di erentiation through service, relationships, reliability, or branding. This explains the rise on the
right side of the U shape.
E ect of Market orientation over time:
Why is this the case?
The more companies include market orientation, the
less the e ect is.
Did market orientation became obsolete?
No it becomes a necessity - If you don’t use Market
Orientation you are going to fall even further behind as
everyone is doing it. You need to think of other ways to
be better than other companies. Also, it still has an
e ect, it is just diminishing.
Message to managers: A substantial Market Orientation must be the foundation for a business’s
competitive advantage strategy.
Reading questions:
1. What is the core of the Market Orientation de nition and how is it related to marketing and the
marketing concept?
The core of market orientation is an organisational culture that prioritises understanding and
satisfying customer needs and preferences while staying aware of competitors’ actions. It
involves aligning all functions of a company—such as marketing, production, and sales—toward
delivering superior value to customers.
Relation to Marketing: Market orientation operationalises the marketing concept (the idea that a
business’s purpose is to discover needs and wants in its target markets and to satisfy those
needs more e ectively and e ciently than competitors). It puts the marketing concept into
practice by ensuring that customer value creation is organisation-wide, not just the job of the
marketing department.
2. Why is it important to measure this concept?
Because it allows researchers to test empirically whether market orientation really improves
pro tability and it provides managers with guidance on how to assess their own rm’s culture and
behaviours, and where improvements are needed.
3. Can you explain why some companies bene t more from (investments in) Market Orientation
than others?
The impact of MO depends on the industry context, ability to di erentiate, and how deeply the
rm embeds MO in its culture. (Commodity vs non-commodity businesses explained above, in
short: non-commodity rms bene t steadily; commodity rms bene t only if they fully commit)
4
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Topic 1: Overview of development in marketing thinking
Marketing origins
• Narver & Slater (1990), The e ect of a market orientation on business pro tability.
• Slater & Narver (1998) Customer-led and market-oriented, let’s not confuse the two.
Current developments in marketing thinking
• Homburg et al. (2017), Customer experience management: toward implementing an evolving
marketing concept.
• Achrol, & Kotler (2022). Distributed marketing networks: The fourth industrial revolution.
Required pre knowledge about marketing strategy:
• Robert J. Dolan (2014), Marketing Reading: Framework for Marketing Strategy Formation.
P1 – p13 are mandatory for this course.
Topic 2: Consumer Insights & motivations
Consumer insights & value
• Laughlin (2014), Holistic customer insight as an engine of growth.
• Van den Driest et al. (2016). Building an insights engine.
Means-end chains in marketing
• Pai & Arnott (2013), User adoption of social networking sites: Eliciting uses and grati cations
through a means–end approach.
• Magids et al. (2015), The new science of customer emotions.
Topic 3: Value equity & innovation
Value perception & delivery
• Almquist et al. (2016), The Elements of Value Measuring—and delivering—what consumers really
want.
• Day (2011), Closing the Marketing Capabilities Gap.
• Lemon et al. (2001). What drives customer equity?
Value innovation
• Kim & Mauborgne (2005), Blue Ocean Strategy: from theory to practice.
• Burke et al. (2010), Blue Ocean vs. Five Forces.
Topic 4: Consumer behavior
Conceptual overview of behavior modi cation in marketing
• Nord & Peter (1980). A behavior modi cation perspective on marketing.
• Wells (2014), Behavioural psychology, marketing and consumer behaviour: a literature review
and future research agenda.
Focus on the sections:
‘Classical conditioning in marketing and consumer behaviour research’ and
‘Operant/instrumental conditioning in marketing and consumer behaviour research.’ Do not worry about the (endless) Tables
Contemporary applications of behavioral theories in marketing
• Gelbrich et al. (2017), Rewarding customers who keep a product: How reinforcement a ects
customers' product return decision in online retailing,
• Chen et al.(2011). Online social interactions: A natural experiment on word of mouth versus
observational learning.
1
ff fifi fi fi ff
,Topic 5: Brand & relationship equity
Brand equity
• Dwivedi et al. (2010), Brand extension feedback e ects: a holistic framework.
• Hsu et al. (2016). Brand architecture strategy and rm value: how leveraging, separating, and
distancing the corporate brand a ects risk and returns.
Focus on the argumentation part about the di erences between the architecture options and the pro's and con's of each
(page 261-268) and the conclusion (page 276-278). Do not focus on the data and speci c outcomes.
Relationship equity and customer equity
• Watson et al.(2015), Building, measuring, and pro ting from customer loyalty Building.
• Hsieh et al. (2005), maintaining a committed online customer: A study across search-
experience-credence products.
• Silveira et al. (2017), Comparing alternative approaches to estimate customer equity.
Final: apply models to a case - very similar to the midterm!
2
ff ff fifffi fi
, Topic 1: Overview of development in marketing thinking
Article 1: Narver & Slater (1990), The e ect of a market orientation on business
pro tability.
Market Orientation is de ned as the organisational culture that most e ectively and e ciently
creates the necessary behaviours for the creation of superior value for buyers, and thus
continuous performance for the business.
They break it down into three behavioural components and two decision criteria:
Behavioural components:
1. Customer orientation
Understanding target buyers well enough to continuously create superior value for them. It
requires that the seller understands the buyer’s entire value chain, not only as it is today but also
as it will evolve overtime.
2. Competitor orientation
Understanding both the short-term strengths/weaknesses and long-term strategies and
capabilities of key-current and key-potential competitors.
3. Interfunctional coordination
The coordinated use of company resources in creating superior value for target customers. This
component emphasizes the need for all departments within the
rm (e.g., R&D, marketing, sales) to work together in a
coordinated way to deliver customer value. E ective
interfunctional coordination ensures that all parts of the
organization contribute to understanding and satisfying the
market’s needs, making the rm more agile and responsive.
Decision criteria:
1. Long term focus
2. Pro tability
In essence, a market-oriented business continuously gathers and
shares information about customers and competitors,
coordinates across functions, and uses this knowledge to deliver
superior long-term value, with pro tability as its ultimate goal
Commodity businesses sell physical products such as dimension lumber, ply wood, wood chips
and logs, all of which are essentially identical in quality and performance to those of competitors.
To create customer value, they usually rely on adding bene ts around the product (e.g., service,
delivery reliability) or reducing buyers’ non-price costs rather than altering the product itself.
Non-commodity businesses have more exibility to adapt
their generic product and add customer bene ts. Can
di erentiate their o erings through product features, design,
or customisation. Two types are in the sample:
1) Specialty products businesses (e.g. hardwood
cabinets, laminated doors)
2) Distribution businesses (merchant-wholesalers
within the corporation and sell to retailers,
contractors, and exporters)
For both the commodity and the non-commodity businesses,
Market Orientation is an important determinant of pro tability
3
fi ff fifi ff fi fi fi fl fffffi fi fi ff ffi
, (ROA). Among the non-commodity businesses, the relationship between Market Orientation and
pro tability was positive and monotonic. Whereas, in the commodity businesses, a positive
market orientation/pro tability relationship is found only among businesses that are above the
median in Market Orientation - the relationship is non-linear (U-shaped). They only gain if they
don’t engage in MO at all, or go “all in”, otherwise they become “stuck in the middle”:
- If a commodity rm does not invest in market orientation, it can still make pro t (ROA) if it’s
e cient, keeps costs low and competes on volume. Then a rm plays the pricing game.
- If a commodity rm invests a little in market orientation, costs rise, but because the product is
still basically the same as others, customers won’t pay more. This creates the dip in pro t (the
U shape): Higher costs, but no extra revenue = low ROA
- If a commodity rm heavily invests in market orientation (if it goes all in) it can create
di erentiation through service, relationships, reliability, or branding. This explains the rise on the
right side of the U shape.
E ect of Market orientation over time:
Why is this the case?
The more companies include market orientation, the
less the e ect is.
Did market orientation became obsolete?
No it becomes a necessity - If you don’t use Market
Orientation you are going to fall even further behind as
everyone is doing it. You need to think of other ways to
be better than other companies. Also, it still has an
e ect, it is just diminishing.
Message to managers: A substantial Market Orientation must be the foundation for a business’s
competitive advantage strategy.
Reading questions:
1. What is the core of the Market Orientation de nition and how is it related to marketing and the
marketing concept?
The core of market orientation is an organisational culture that prioritises understanding and
satisfying customer needs and preferences while staying aware of competitors’ actions. It
involves aligning all functions of a company—such as marketing, production, and sales—toward
delivering superior value to customers.
Relation to Marketing: Market orientation operationalises the marketing concept (the idea that a
business’s purpose is to discover needs and wants in its target markets and to satisfy those
needs more e ectively and e ciently than competitors). It puts the marketing concept into
practice by ensuring that customer value creation is organisation-wide, not just the job of the
marketing department.
2. Why is it important to measure this concept?
Because it allows researchers to test empirically whether market orientation really improves
pro tability and it provides managers with guidance on how to assess their own rm’s culture and
behaviours, and where improvements are needed.
3. Can you explain why some companies bene t more from (investments in) Market Orientation
than others?
The impact of MO depends on the industry context, ability to di erentiate, and how deeply the
rm embeds MO in its culture. (Commodity vs non-commodity businesses explained above, in
short: non-commodity rms bene t steadily; commodity rms bene t only if they fully commit)
4
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