Marketing Paradigm in the Third Millennium[/b]
By Prof. D. Sriram, Faculty XIME[/b]
In January 2012, Journal of the Academy of Marketing Science, a very prominent marketing research journal celebrated its 40th anniversary and bought out a special issue on the prevalent and emerging marketing thought processes. One of the articles , written by Achrol & Kotler (2012), discusses the paradigm shift in the field of marketing.
The field of marketing has transformed in the last 100 years, starting as a functionalist discipline of marketing management practise to an exchange paradigm. The exchange paradigm ( exchange of goods, services, money, time, place ideas & information mainly through dyads) is now evolving into a network paradigm. In this background the authors have proposed a three tiered framework to explain the paradigm shift in marketing from microcosmic to societal level.
At the micro level, consumption is the fundamental process in marketing and satisfaction, value and utility are the elemental concepts. In the emerging paradigm, consumer research is expected to transform from cognitive domain (Attitude, information storage and retrieval ) to sensory depiction of reality and its experience (neuro-physiological). Marketers are attempting to build in visual, auditory, olfactory and tactile/haptic senses into products and services that they design for consumers. 3D television and games with special effects (thunder/ lighting, breeze, vibrations etc.) are the first products that incorporate sensory experience. Researchers are attempting to study the close relationship between brain and mind, and minding would be incorporated into products of the future. Cyberspace and virtual reality will take over and we can create our own virtual 3D Avatars on the web to hold conversations, socialize and do shopping. Revolution in the field of science will also forge convergence of various technologies into NBIC ( Nano-technology driven convergence of nanotech, biotech, infotech and cognotech), which would result in products like long mileage tyres, inkjet printers that can hold images for 100 years, anti wrinkle cosmetics etc.
At the meso level, marketing function in organizations is evolving from hierarchies to networks. Earlier, firms were gaining operational efficiencies through vertical integration and were reaching out products and services to consumers through hierarchical channel structures. Going ahead, firms through value-add would move forward in network and become closer to customer. In short, production and consumption would be bought close together through exchange of knowledge, based on relational governance and norms based systems. This would be achieved by firms through embracing open innovation model, adopting distributed production and consumption networks, and, creating consumption networks. Large firms are outsourcing innovation to smaller firms and a recent example is the role of Taiwanese firms in introducing innovations in cell phones, PDAs, Laptops and cameras.
Distributed production consumption network is the ultimate ‘Just in Time’ production where production will be enjoined with consumption. One example in the power generation sector is the possible advent of house hold fuel cell systems and roof-top wind powered system providing energy for homes. Kindle and I-Pads threaten the existence of printing Industry through their on-line e-book service. Firms would encourage developing enduring relationship consumers through promoting CSC networks enabling horizontal flow of information, Word of mouth and technical advice. On the whole, this would enable bottom-up marketing model addressing heterogeneity of preferences, information sharing and facilitating consumer choice.
At the macro level, marketing should care about the welfare of the society. Two prominent issues where marketing could contribute include sustainability and Bottom of Pyramid (BOP) marketing. Over 3 billion of world’s population, live on less than $2.50/day (US average- $10.00/day), especially in developing economies. Empowerment of BOP customers will be through thoughtful conceptualization of products and services for them. The growth potential of organization will depend on how they address the needs of BOP customers. Another macro level issue is sustainability. In order to establish credibility amongst customers and to serve the society-in-large, marketers should not promote over-consumption. Some of the initiatives that marketers should adopt include communicating the harmful side effects of their products, encourage environmentally conscious customers, and, also de-market/ counter market certain products.
On a whole, the three tier hierarchy of thought process is profound and all inclusive. Public policy will play a major role in operationalizing certain aspect of the emerging paradigm, but much depends on the responsibility the thought leaders and practitioners take on themselves to make the world a better place to live in. For a more in-depth view, readers are requested to read the original article. Achrol, Ravi. S. And Philip Kotler (2012), ‘Frontiers of the marketing paradigm in the third millennium, ‘Journal of the Academy of Marketing Science, Vol. 40, pp 35-52.
By Prof. D. Sriram, Faculty XIME[/b]
In January 2012, Journal of the Academy of Marketing Science, a very prominent marketing research journal celebrated its 40th anniversary and bought out a special issue on the prevalent and emerging marketing thought processes. One of the articles , written by Achrol & Kotler (2012), discusses the paradigm shift in the field of marketing.
The field of marketing has transformed in the last 100 years, starting as a functionalist discipline of marketing management practise to an exchange paradigm. The exchange paradigm ( exchange of goods, services, money, time, place ideas & information mainly through dyads) is now evolving into a network paradigm. In this background the authors have proposed a three tiered framework to explain the paradigm shift in marketing from microcosmic to societal level.
At the micro level, consumption is the fundamental process in marketing and satisfaction, value and utility are the elemental concepts. In the emerging paradigm, consumer research is expected to transform from cognitive domain (Attitude, information storage and retrieval ) to sensory depiction of reality and its experience (neuro-physiological). Marketers are attempting to build in visual, auditory, olfactory and tactile/haptic senses into products and services that they design for consumers. 3D television and games with special effects (thunder/ lighting, breeze, vibrations etc.) are the first products that incorporate sensory experience. Researchers are attempting to study the close relationship between brain and mind, and minding would be incorporated into products of the future. Cyberspace and virtual reality will take over and we can create our own virtual 3D Avatars on the web to hold conversations, socialize and do shopping. Revolution in the field of science will also forge convergence of various technologies into NBIC ( Nano-technology driven convergence of nanotech, biotech, infotech and cognotech), which would result in products like long mileage tyres, inkjet printers that can hold images for 100 years, anti wrinkle cosmetics etc.
At the meso level, marketing function in organizations is evolving from hierarchies to networks. Earlier, firms were gaining operational efficiencies through vertical integration and were reaching out products and services to consumers through hierarchical channel structures. Going ahead, firms through value-add would move forward in network and become closer to customer. In short, production and consumption would be bought close together through exchange of knowledge, based on relational governance and norms based systems. This would be achieved by firms through embracing open innovation model, adopting distributed production and consumption networks, and, creating consumption networks. Large firms are outsourcing innovation to smaller firms and a recent example is the role of Taiwanese firms in introducing innovations in cell phones, PDAs, Laptops and cameras.
Distributed production consumption network is the ultimate ‘Just in Time’ production where production will be enjoined with consumption. One example in the power generation sector is the possible advent of house hold fuel cell systems and roof-top wind powered system providing energy for homes. Kindle and I-Pads threaten the existence of printing Industry through their on-line e-book service. Firms would encourage developing enduring relationship consumers through promoting CSC networks enabling horizontal flow of information, Word of mouth and technical advice. On the whole, this would enable bottom-up marketing model addressing heterogeneity of preferences, information sharing and facilitating consumer choice.
At the macro level, marketing should care about the welfare of the society. Two prominent issues where marketing could contribute include sustainability and Bottom of Pyramid (BOP) marketing. Over 3 billion of world’s population, live on less than $2.50/day (US average- $10.00/day), especially in developing economies. Empowerment of BOP customers will be through thoughtful conceptualization of products and services for them. The growth potential of organization will depend on how they address the needs of BOP customers. Another macro level issue is sustainability. In order to establish credibility amongst customers and to serve the society-in-large, marketers should not promote over-consumption. Some of the initiatives that marketers should adopt include communicating the harmful side effects of their products, encourage environmentally conscious customers, and, also de-market/ counter market certain products.
On a whole, the three tier hierarchy of thought process is profound and all inclusive. Public policy will play a major role in operationalizing certain aspect of the emerging paradigm, but much depends on the responsibility the thought leaders and practitioners take on themselves to make the world a better place to live in. For a more in-depth view, readers are requested to read the original article. Achrol, Ravi. S. And Philip Kotler (2012), ‘Frontiers of the marketing paradigm in the third millennium, ‘Journal of the Academy of Marketing Science, Vol. 40, pp 35-52.