What We Explore is Important: Delving into the Larger Field of Marketing William L. Wilkie, William L. Wilkie, Nathe Professor of Marketing University.

What We Explore is Important: Delving into the Larger Field of

Marketing

William L. Wilkie, Nathe Professor of Marketing

University of Notre Dame

AMA Symposium: “Ideas That Matter…”Boston, MA.

August 13, 2010

My Extended Effort: to Try to Discover for Myself “What is Marketing,

Anyway?”

Working for 13 years on various dimensions of how to conceptualize our field of study… 3 primary outcomes of the project so far…

-- 1999: “Marketing’s Contributions to Society”

Journal of Marketing (Millennium Issue 1999), with Elizabeth Moore

-- 2003: “Scholarly Research in Marketing: Exploring the 4 Eras of Marketing Thought Development”

Journal of Public Policy & Marketing (Fall 2003), with Elizabeth Moore

-- 2006- 2009: Several articles aimed at improving the AMA Definition of Marketing (with Greg Gundlach and Elizabeth Moore)

*** All papers are available for download from my homepage at Notre Dame (nd.edu)

Overview of My Basic Questions about What Issues to Explore

Question # 1: Do we need aggregate

perspectives in conceptualizing the Marketing field? (a brief reprise of the “Aggregate Marketing System.” )…

Question # 2: Should we be interested in the impacts Marketing is having in our world? Why are we not?

Question # 3: Is knowledge being lost from our field? Where have we been and where are we heading? (a brief reprise of the “4 Eras” of Marketing Thought)…

100 Years of the Aggregate Marketing System in the United States: What has It Brought ?

Three Early Insights were that Marketing’s contributions:

(1) Accumulate Over Time (2) Diffuse Through a Society (3) Occur within the Context of Everyday Life

This can make it difficult to distinguish them at any given point in time, so we took a 100 yearglimpse.

The Aggregate Marketing System at Work

2 Background Issues:

-- Most elements of Marketing are “hidden from view” for anyone but the persons participating. This is a challenge for understanding (and appreciation).

-- Today in Business Schools we’re not looking at Marketing as a larger system.

So let’s begin with an illustration of the Aggregate Marketing System in action … “Breakfast at Tiffany’s” Please picture Tiffany Jones in her New York apartment having breakfast with her family. She blows across her cup of coffee…

THE SYSTEM AT WORK PANEL A: COFFEE

Coffee Grower

Exporter

(T)

Grower’s Depulping

Mill

(T)

Grower’s Warehouse

(T)

(T)

Manuf. Roasting

Plant

Manuf. Regional

Distribution Center

(T)

CO

NS

UM

ER

S

Retailer’s Warehouse

Retail Store (A1…n)

Retail Store (B1…n)

(T)

(T)

Large Chain Retail Store

(C1…n)

Large Chain Retail Store

(D1…n)

(T)

Mass

Merchandiser (E1…n)

Mass

Merchandiser (F1…n)

(T)

Wholesaler’s Warehouse

Retail Store (G1…n)

Retail Store (H1…n)

(T)

(T)

THE SYSTEM AT WORKPANEL B: BREAKFAST PASTRY

Wheat Farmer

Dairy Farmer

Corn Farmer

Apple Grower

Inte

rmed

iate

In

gred

ien

t P

rod

uct

ion

Sys

tem

Sweeteners

Fruit Flakes

Milk Proteins

Wheat Flour

(T)

Manufacturer’s Plant

CO

NS

UM

ER

SNOTE: SAME DISTRIBUTION CHANNELS AS IN PANEL A

THE SYSTEM AT WORK PANEL C: FAMILY BREAKFAST

Family Breakfast Items

Tiffany - Coffee - Non-Dairy Creamer - Sugar - Breakfast Pastry Robert

- Coffee - Equal - Corn Flakes - Skim Milk - Banana

Laura - Orange Juice - Microwaveable Oatmeal - Skim Milk - Daily Vitamin

Jim - Orange Juice - Frozen Waffles - Butter - Maple Syrup

Kitchen Support System

Housewares - Ceramic Mugs - Plates, Bowls - Flatware - Tablecloth - Napkins - Table and Chairs

Cooking - Automatic Coffeemaker - Coffee Filters - Toaster Oven - Microwave Oven - Cooking Utensils

Maintenance - Refrigerator - Freezer - Dishwasher - Dish Detergent - Sponge, Dish Towel

Service - Electricity - Piped Water - Water Purifier - Lighting

PANEL D. SELECTED MARKETING SYSTEM ACTIVITIES (present in the coffee and breakfast pastry examples)

Organizations: - Sourcing Raw Material Supply (2) - Quality Specifications (2) - Purchase of Capital Equipment (3) - Outsourcing: Specialist/ Expert Services (2) - Purchase for Resale (1) - Assortment Building (1) - Bulk Breaking (2) - Order Processing (2) - Negotiation: Terms of Sale (1) - Transfer of Ownership (2)

Consumers: - Product Acquisition (2) - Product Preparation (3) - Product Consumption (3) - Product Maintenance/Repair (2) - Product Disposition (2)

Organizations: - Market Analysis (1) - Market Demand Assessment (1) - Analysis of Competitive Strategies (1) - Market Segmentation (1) - Market Forecasts (1) - Performance Monitoring (1) - Program Evaluation (1)

Consumers: - Consumer Education (2) - Information Search (2) - Word of Mouth (3) - Store Visits (2) - Post-Purchase Analysis (3)

Organizations: - Financial Projections (2) - Board of Directors Approval (2) - Product Design (2) - Product Line Decisions (1) - Budget Setting (2) - Distribution Planning (1) - Brand Name Selection (1) - Packaging (1) - Market Testing (1) - Positioning Strategy (1) - Pricing Decisions (1) - National Advertising (1) - Direct Marketing (1) - Consumer Promotion (1) - Trade Promotion (1) - Trade Advertising (1) - Communication to (1) Sales Force

- Point of Purchase Materials (1) - Publicity (2) - Warranty Terms (2) - Customer Service (2) - Retailer Assortment (1) - Merchandising (1) - Retail Advertising (1) - Inventory Management (2)

Government Agencies:

- Standard Setting (2) - Export/Import Controls (2) - Trademark Protection (2) - Financing Arrangements (2) - Nutritional Labeling (2) - Inspections (3) - Regulatory Rules and (2) Guidelines

Purchasing and UseKnowledge

Development/IntelligenceSales and Delivery Marketing Plans and Programs/Government Actions

The Classic Functions of Distribution - Transportation (2) - Storage (2) - Financing (2) - Risk-Bearing (2) - Assembly (1) - Selling (1) - Standardization (2) - Market Information (1)

N.B., Detailed Levels of Activities Exist: (e.g., Transport Activities) - Truck to Depulping Mill - Beans to Drying Area …..……. - Ship to New Orleans - Hopper Truck to Roasting Plant …..…….

- Truck to Retail Store … additional steps in text

Organizations: Government: - Internal Management of Work Force (n) - All non-commerce/non-consumer sectors (n) - Management of Plant & Equipment (n) Consumers: - Financial Mgmt., Accounting & Control (n) - All non-consumer aspects of daily life (n) - Basic Research, etc. (n)

(1) = Largely or entirely controlled by marketing managers

(2) = Largely controlled by others, but influenced by or coordinated with marketing managers

(3) = Little or no influence by marketing managers

(n) = Activity does not involve marketing

PANEL E. DEPICTING THE ENTIRE AGGREGATE MARKETING SYSTEM

(Multiplicative Increase)

Brand Pastry System (Panel B)

(Large Geometric Increase)

All system activities given for the cup of coffee, beginning with harvest of beans on left, ending with consumer use and disposition on right. (2) (2) (2) (2) (1) (1) …… (note: not all activities controlled by marketers, see key in panel D) …… (2) (3) (3) (2) (2)

Brand Coffee System (Panel A)

Add all coffee systems

(Huge Geometric Increase)

All system activities given for pastry beginning with creation, storage and transport of 15 pastry ingredients and ending with consumer use and disposition.

(Similar sets of activities, participants and forms of value creation)

Add all breakfast systems, on-premise restaurants and home kitchen systems

(Larger Geometric Increase) Add all other food and beverage systems

Add all product systems and all service systems

Add all not-for-profit marketing activities

Add all government and all consumer marketing system activities

(Huge Geometric Increase)(Huge Geometric Increase)

“

“

“

“

“

“

Numerical Key: Centers of Little or No Marketing Involvement

Panel D: Essential Points

Selling, purchasing and use occur throughout system.

Note the significance of infrastructure, careful planning, coordination and repetition … this system is very structurally sophisticated, and routinely provides breakfasts for 100 million households every day.

The Government is an important behind the scenes facilitator of business (marketing) activity.

A surprisingly large number of marketing system activities in just a simple illustration (over 75 listings).

Key Lessons From the Project…

(Re: Today’s Symposium): From Panel D we see that Marketing managers control only some (30 of the 75) of the AGMS activities: other activities are controlled by persons who do not consider themselves in marketing. This property of the system demands a perspective on Marketing that reaches far beyond a sole focus on a marketing manager’s controllable decisions. An inclusive appreciation of business organizations and processes is clearly required.

Overall, the U.S. AGMS is Huge, Practiced, and Powerful. It is composed of both extensive physical infrastructure and a massive, trained and experienced workforce (we estimate that some 30 million U.S. adults are directly employed in carrying out the activities of the AGMS). In my view, it deserves much more directed attention in our Ph.D. programs, and from our college of marketing thinkers more generally.

II. The “4 Era’s” of Marketing Thought: What are We Thinking About?

Background:

-- An Historical look across the last century.

-- Just as the real world of marketing has changed, so has its body of academic thought.

-- Before discussing where we’re going, a key perspective: where have we been?

Conceptual Offering: The “4 Era’s” of Marketing

Thought

(“Pre-Marketing”) (Before 1900)

I. “Founding the Field” (1900-1920)

II. “Formalizing the Field” (1920-1950)

III. “A Paradigm Shift…Marketing, Management, and the Sciences”

(1950-1980)

IV. “The Shift Intensifies: A Fragmentation of the Mainstream of Thought” (1980- )

Era I. “Founding the Field” (1900-1920)

Academic Field of Marketing 1st Courses with “Marketing” in Title Emphasis on Purview of Marketing’s

Activities as an Economic Institution Focus on Marketing as Distribution

Attention to Aggregate Issues Willingness to Raise Larger Questions

(e.g., Are there too many middlemen? Does distribution cost too much? Does advertising raise or lower prices to consumers?)

Key Criteria: Based on Economic Efficiency

Era II: “Formalizing the Field”

(1920-1950)

Academic Field of Marketing Development, and Integration of Marketing

Thought Aimed at “Marketing Principles” Creation of Organized Infrastructure for

Knowledge Development and Dissemination

Some General Characteristics of the Period

Economic & Social Upheaval (e.g., prosperity of early 1920s; Depression, WW

II, Post-war) New Product Choices, Technological

Developments Resurgence of Consumer Movement (in 1920s

and 1930s)

Academic Organization

Growth in Formation in Colleges of Business and Departments of Marketing

1924: Formation of Nat’l Association of Teachers of Marketing & Advertising.

1930: American Marketing Society Forms (focused on practitioners)

1937: Two Groups Merge – Form American Marketing Association, which Provides Bases for Sharing Marketing Thought.

Marketing Texts (1920-1950)

Core Presentation (Integration of 3 Key Approaches): Commodity: study processes of marketing a

particular product(e.g., agricultural commodities, raw materials from extractive industries)

Institutional: analysis of wholesale and retail institutions

(e.g., chain stores, mail order) Functional: activities performed by marketing

organizations(e.g., transportation, storage, financing, risk-bearing, assembly, selling, standardization, market information)

Illustrative Texts: Clark (1922); Ivey (1922); Converse (1924); Maynard, Weidler and Beckman (1927); Phillips (1938)

Academic Journals & Proceedings

1925: Journal of Retailing Begins at NYU

1936: Journal of Marketing Debuts Diverse Contributors:

-- 40% Academics, 45% Business, 15% Government Papers Tend to be Brief, Non-Empirical 90% Articles Single-Authored Considerable Coordination of AMA

Conferences and JM -- (41% of JM articles originally presented at AMA)

JM A Communication Forum: Commentaries Encouraged

Becomes Center for Advancing Marketing Thought

Era II: Some Observations….

Relative to today, a Different Approach to Marketing.

Descriptive Orientation, Not Problem-Solving at Firm Level.

Significant Attention to External Developments and the Exigencies of the Times.

Later in Period, Substantial Attention to Wartime Issues, then Planning for Post-War Economy.

***Academics Seemed to Have a Willingness to “Stand Outside,” Observe, and Critique.

Era III: “A Paradigm Shift: Marketing, Management, and

the Sciences” (1950-1980)

“The Boom Arrives”

“The Field Evolves” -- Two Emerging Perspectives Come to Dominate the Mainstream

-- “Marketing as Science” (Behavioral - Quantitative)

-- “Marketing as Management”

“Growth in the Academic Infrastructure”

“The Boom Arrives”

The Post-World War II Period Brings a Dramatically Changing Marketing World:

The “Mass Market” Begins, Fueled by Pent-up Demand and the Massive “Baby Boom” Generation.

Dramatic Improvements in Transportation (e.g., interstate highway system), Communication (e.g,, television, prime time), Technology (computers) , Mobility (new growth regions), and Consumer Incomes.

New Opportunities for Marketing, and New

Challenges for Marketing Thought (e.g., how to best deal with a mass market?).

Baby Boom Spurs Enrollments in Business Schools

during Era III.-- More schools become “research-

oriented.”-- Derived demand: increase for research

academics.-- Overall, dramatic growth in research,

plus shortage of faculty.

0%

100%

200%

300%

400%

500%

600%

700%

800%

900%

1000%

1950 1955 1960 1965 1970 1975 1980

Master's degrees awarded in Business

Bachelor's degrees awarded in Business

FIGURE 4 (B)

GROWTH PATTERNS DURING ERA III

0%

100%

200%

300%

400%

500%

600%

700%

800%

900%

1000%

1950 1955 1960 1965 1970 1975 1980

Ph.D. degrees awarded in Business

AMA Professional Membership

Ind

exed

to

Bas

e Y

ear*

*Source: U.S. Dept. of Education (2001); Degrees indexed Relative to 1955

(1661 % in 1980)

The Field Evolves in New Directions

The Turn to a Managerial Perspective:

Those External Factors of the Boom (e.g., how do I best advertise to a mass market?)

New Texts Brought New Education (e.g., John Howard 1957; E. Jerome McCarthy 1960; Philip Kotler 1967).

Burst of New Key Concepts (n.b., still central a half-century later).

Field Evolves in New Directions (con’t)

The Emergence of the Sciences:

-- Fueled by a Rapid Development of Computerization.

-- Behavioral Science Diffused Slowly During First Half of Era III, then Rapidly During the 1970’s.

-- Management Science was Stimulated by the National Plan for Math, and Grew More Quickly:

• Ford Foundation Program (1953 - 1961)• 5 Schools, Serially ( Carnegie, Harvard,

Columbia, Chicago, Stanford), then “trickle down.”

• Gordon/Howell Report (1959): Change needed,

• Harvard/MIT Mathematics Institute (1960)

Growth in the Academic Infrastructure

-- Over 1100 New Marketing Ph.D.’s between 1955-1980, many wishing to make contributions to the body of thought in Marketing.

-- The Knowledge Infrastructure Expands Substantially.

- Marketing Science Institute formed (1961) to encourage, initiate, and support the new research.- New Journals Arise (JAR, JMR, JCA, JCR,

JAMS).- New Associations (ACR, TIMS) are created.- A 4-fold Increase in the body of journal

thought during Era III.

 Managerial

Frameworksand Approaches

 Discipline-Based

Theories

 Research Methods, Models, and Measurement

 Marketing conceptMarketing mix - 4 P’s Product life cycleDAGMARDevelopment of marketing casesStage approaches to strategy development New-product development processPhysical-distribution managementMarketing information systemsProduct positioning & perceptual mapping Segmentation strategiesNew marketing organization concepts (e.g., brand management)Territory design & sales force compensation Marketing auditDemand-state strategies Creative approaches and stylesNew search & screening approaches Refinements in test-marketing approaches

Market segmentation

General and middle-range theories of consumer behavior Image and attitude theory

Theories of motivation, personality, social class, life style, and culture Expectancy-value theory

Theories of advertising processes and effects Information-processing

Attitude-change theories Attribution theory

Perceptual processes

Distribution theory

Refutation and distraction hypotheses Theories of diffusion, new-product adoption and personal influence Prospect theory

 Data Analysis: Broad & Specific:

– Causal models – Weighted belief models, determinant attributes – Bayesian analysis – Sensitivity analysis & validity tests – Response functions – Marginal analysis & linear

programming – Multidimensional scaling & attitude measurement – Forecasting – Econometrics – Time-series analysis – Trade-off analysis & conjoint analysis – ANOVA – Multivariate dependence methods:

multiple regression, multiple discriminant analysis

canonical correlation – Multivariate interdependence methods: cluster and factor analysis, latent structure analysis

 Data Gathering: Adoption and Refinement

– Advances in survey research – Focus groups, depth interviewing – Experimental & panel designs – Motivation research & projective techniques – Hypothesis formulation, inference, sign. tests – Psychographics & AIO studies – Unobtrusive measures, response latency, nonverbal behavior – Physiological techniques: (e.g., eye camera, GSR, CONPAAD) – Probability sampling

Marketing Models

– Advertising (e.g., Mediac, Brandaid, Adbudg) – Sales management (e.g., Dealer, Callplan) – New-product (e.g., Demon, Sprinte, Steam) – Product planning: Perceptor, Accessor – Bid pricing models – Stochastic brand choice – Market-share models

Marketing Cases and Simulations

– Simulation & marketing games – Computer-assisted marketing cases

Adapted from Myers, Massy and Greyser (1980)

FIGURE 6

SOME EXAMPLES OF KNOWLEDGE DEVELOPMENTS IN MARKETING (1952-1977)

Era III: (con’t.)

In conclusion, Notice also that the training required to contribute to the Marketing Body of Thought had changed dramatically during Era III, compared to the end of Era II.

The Paradigm had Shifted - - The Field of Marketing had Changed.

Era IV: “The Shift Intensifies – A Fragmentation of the Mainstream”

(1980-present) Major Dislocations in Real World of

Marketing. “Publish or Perish” Pressures

Intensify. The Two Dominant Perspectives

Continue. -- Managerial Focus Persists.-- Scientific Approach Persists as

Well.

But, Tensions Burst, Much as an Overfull Dam, So That Waters Can Find their

Course.

Knowledge Infrastructure Expands Rapidly to Accommodate Diverging Interests.

Upheavals in the Real World of Marketing

E.g.:

-- The Demise of Command Economies.

-- Globalization.-- Financial Hegemony (LBO’s) Drives

Business.-- Technological March Continues

(e.g., Internet).

Upheavals in Marketing Thought

E.g.,

-- JM Policy Change-- “Post-Positivism” Revolution-- nb. only 3 articles with the word

“Marketing” in the titles in the 1st 20 years of JCR.

Trend 1: Business Education Goes Global - Many New

Scholars

Huge Jump in MBA Programs Worldwide (e.g., now 50 in Russia, 60 in China, >100 in Cen./Eastern Europe, almost all w/in15 years).

Plus, MBA’s in U.S. have doubled, now 115,000 per year.

So, more demand for business academics.

But largest impact has been in number of internationally-related scholars….

Trend 2: An Outpouring of New Publication Outlets

A Remarkable Period from 1980 – 1984: in five short years the number of research-based marketing journals more than doubled (from 7 to 15). See Figure…

Early 1990’s: Development of AMA “SIG’s.”

Figure 9

MARKETING JOURNALS INTRODUCED DURING THE 1980’S

Date Publication1980 Journal of Personal Selling and Sales

Management1981 Journal of Macromarketing1982 Journal of Public Policy & Marketing1982 Marketing Science1983 Journal of Consumer Marketing1984 Psychology & Marketing1984 Journal of Product Innovation and

Management1984 International Journal of Research in

Marketing1987 Journal of Interactive Marketing1989 Marketing Letters

Trend 3: Research Specialization and the Fragmentation of the

Mainstream “It is troubling to realize that Knowledge does

not necessarily accumulate in a field -- that Knowledge can disappear over time if it is

not actively transmitted and received.” (Wilkie, 1981 ACR Presidential Address)

“… this risk has now increased – knowledge outside a person’s speciality may first be viewed as non-instrumental, then as non-

essential, then as non-important, and finally as non-existent, in terms of meriting

attention.” (Wilkie, July 2002 Journal of Marketing Essay)

The Crucial Question? Will future young marketing scholars even know they have a choice? What is (will be) their conception of the field of Marketing?

Conclusions

-- #1. Marketing scholars should be monitoring the impacts that marketing is having on the world., and should be developing knowledge from this.

-- #2. The Aggregate Marketing System – its characteristics, size, power, and capacities to both improve and injure the world in which we live – belongs as an intrinsic part of the mainstream of marketing thought.

-- #3. Fragmentation of marketing thought is powerful -- perhaps irresistible – but this causes knowledge to be lost from our field... Calls for revised Ph.D. education.

-- #4. This symposium’s attention to both conceptualization and the 1988 AMA Task Force is highly appropriate: It is past time for another hard look at ways to enhance scholarship in our field .