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European
Is marketing knowledge
Marketing
useful?
Journal of
36,3
.
Kjell Grenhaug
364
Norwegian School of Economics and Business Adminstration,
Bergen, Norway
Keywords
Marketing, Marketing theory
Abstract Marke! knowledge is usually believed to be useful. Both the concepts of “knowledge”
and
“useful” are,
however,
rather ambiguous
and used in multiple
ways.
The concepts
are
clarified, and requivements for adequate knowledge use discussed. An important conclusion is
that academian marketing knowledge can be useful, requiving, however, both knowledge,
consuming and motivated efforts.
Emerald
Vol, 3 No.5 202 op 64 72
Sorta scams:
time-
Introduction
It is commonly believed that marketing knowledge is useful. Marketing
knowledge comes in many forms. Here the focus is on marketing knowledge as
produced, taught, and thus disseminated by marketing academicians. This
author claims that such knowledge — in principle — should be useful, but that
this is not always so.
“Knowledge” is a positively laden concept. This is reflected in sayings like.
“Knowledge is power”, in the focus on research, i.e. the creation of new insights
or knowledge, and in the emphasis on learning, i.e. acquisition of knowledge or
insights as emphasized in the various business disciplines including
marketing. For example, Day (1994) emphasized the continuous need to learn
about customers and competitors and to exploit such knowledge to stay ahead.
The more recent interest for and emphasis on market orientation by and large
also relates to acquisition and exploitation of knowledge about customers and
competitors (Slater and Narver, 1995).
Much of the knowledge produced and taught by marketing academicians is, to
a substantial extent, (assumed to be) based on research. Research is, however, an
ambiguous term, and a commonly agreed upon definition of what to subsume
under this term can hardly be said to exist. However, most academicians (and
maybe people in general) believe that the purpose of research is to create new
(and hopefully) useful knowledge. There is also (more or less) agreement that
research represents goal-directed and systematic efforts to gain insights, and that
documentation and inter-subjectivity as emphasized in the research literature are
important. A key requirement is also that knowledge based on research should
be valid, 1.e. what is stated or claimed “holds true”.
Research is, however, only one of several ways to acquire insights.
Individuals and firms may acquire useful insights by reflecting on their own
trials, failures and successes. Firms may gain insights through observations of
their competitors, and individuals and firms may successfully imitate others
with the resulting outcome that they “learn what works”. The remaining part of
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this paper is organized in the following way. In the next section we discuss the
notion of marketing knowledge. Here we also address the ambiguous term
Is marketing
knowledge
“useful knowledge”. We address this problem by discussing different types of
knowledge use. Here we also discuss different types or elements of knowledge,
as reflected in the marketing literature. After this we focus on key challenges in
making use of academic marketing knowledge. We do this by addressing
useful?
differences in producing and making use of knowledge. This section also offers
365
examples of difficulties confronted if one is to make adequate use of academic
marketing knowledge. Finally, practical and theoretical implications are
highlighted.
Marketing knowledge
Here the emphasis is on marketing knowledge as produced, taught and
disseminated by marketing academicians. The teaching by marketing
academicians relates to education, Le. a systematic way of transferring
marketing knowledge to potential users. In principle, this can be seen as
transferring and supplying training of some aspects of the pool of acquired
marketing insights to individuals who are supposed to benefit from this
knowledge in some way or other.
Knowledge
So far no attempt has been made to define what is meant by knowledge. An old
definition dating back to Aristotle says that knowledge implies that we know
something and what we know “holds true”. This definition or view assumes
that the claimed knowledge has passed some rigorous test. Such a perspective
implies that a discovery or a new theory that has not been adequately tested
represents pre-scientific knowledge (e.g. Calder, 1987). Many researchers
disagree with such a definition. For example, some researchers claim that to
“see” and construct new problems and solutions are the most demanding and
useful research tasks (e.g. Morgan, 1983). Today “knowledge” is often
conceived as insights believed in and agreed upon. For example, marketing
gurus’ viewpoints and recommendations are (too) often believed and followed
even though their claimed effects have not been demonstrated in a convincing
way.
Useful knowledge
What is useful knowledge then? This apparently simple question is not so easy
to answer, and has been given much attention in past research. To answer this
question, one may start by looking at different knowledge uses. One may, for
example, distinguish between instrumental, conceptual and symbolic uses of
knowledge (Pelz, 1978). Instrumental use implies that knowledge (e.g. brought
forward through research) is used to solve a specific problem. For example,
present insights are used to solve a pressing computer problem. In such
situations the outcome is rapidly experienced and the knowledge applied 1s
considered useful.
|
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European
By conceptual use we mean knowledge that yields insights, and may result
Journal of
in a new explanation or way of conceiving a phenomenon. An example is
Marketing
96.3
Coase’s (1937) speculation about why firms exist, published in his article, “The
nature of the firm”, which after being forgotten for almost 20 years was picked
up by Oliver Wiliamsen, who made Coase’s contribution a cornerstone in the
b
development of transaction cost analysis (1'CA). Over the years TCA has had a
366
profound impact on the thinking of how to organize economic activities, and
has been applied widely by marketing academicians to understand marketing
phenomena, and by marketing practitioners to organize their costly marketing
activities.
One may easily get the impression that conceptual knowledge is less useful
than knowledge that immediately yields results, eg. solutions based on
technical and natural science knowledge. The recognized sociologist Giddens
(1996) claims, however, that the importance of conceptual knowledge created
through social science research is even more important than the practical
insights created through technical and natural science research, because of
changes in perspectives and new understanding.
By symbolic use we here mean knowledge that is used to signify or argue a
point of view or decision, even that the knowledge has not influenced the
decision or point of view as such (which is the case for instrumental use of
knowledge). Many will probably hold a somewhat reluctant attitude towards
such knowledge use. There is, however, little doubt that such knowledge use is
quite common both in political, business and everyday life.
Actionable knowledge
In business and marketing, useful knowledge is often associated with
instrumental use, ie. knowledge resulting in recommendations for actions.
Research resulting in such knowledge is often termed actionable research
(Andreassen, 1983). To become actionable, however, the action-given research
outcome or analysis of the actual problem must be specified in advance, e.g.
given research finding “X” implement action “Y”. Research findings and
existing marketing knowledge, however, do not often give direction or
recommendation for actions. For example, the observation that the firm's
product/service
offering
does
not
stand
comparison
with
those
of its
competitors does not necessarily give direction or recommendations on how to
go about improving and enhancing customer satisfaction. Rather, the
observation can be seen as a diagnosis. The next step is to integrate the
diagnosis into the marketer's knowledge structure — or “mental model”
(Johnson-Laird, 1983) of what drives customer satisfaction. From this we see
that observations and situations marketers are confronted with must not only
be noted, they must be interpreted as well to make use of marketing knowledge,
which also requires knowledge, time and attention.
When exposing students and practitioners to (new) marketing knowledge, a
key purpose is that this should result in learning, ie. acquisition of new
insights. This requires that the audience must understand what (the advances)
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it is exposed to are, and also what it is exposed to must result in new
understanding. Marketing knowledge first becomes new knowledge when it
results in a difference in memory (Brucks, 1985, p. 2). This last point is
important to understand knowledge use and improvements. People have (more
or less developed) knowledge structures. New knowledge they are exposed to
may be integrated into existing knowledge structures without acquiring new
insights. Research also shows that well-established knowledge structures tend
to be rather rigid, making it almost impossible to acquire new insights. In his
fascinating article Argyris (1991), for instance, demonstrates how highly
competent actors retrieve and make use of their existing insights, without
learning anything new. Only when exposed to shocking conflicts they “open
up” and become receptive to new insights. Thus, being exposed to marketing
knowledge does not necessarily become useful.
Is marketing
knowledge
useful?
367
Elements of knowledge
We may group marketing knowledge or “theory” as taught and documented by
marketing academicians in the following way (after Nagle, 1961):
theories/models;
»
concepts;
+
methods/techniques; and
facts.
By theories and models we will here mean general representations, often used
to describe and explain phenomena, as well as to predict developments and
outcomes[1]. Multiple “theories™2] and models exist in the marketing
discipline. Examples are “perceived risk” and “cognitive dissonance” to
understand and explain consumers’ pre- and post-purchase hehaviours:
Porter's “five-force” model to describe and understand market competition as a
basis for competitive moves, and the Bloston) Clonsulting) Group) matrix to
capture firms’ product portfolios as a basis for future harvest and investment
decisions. The BCG matrix, with its “stars”, “question marks”, “cash cows” and
“dogs”, is casily grasped by marketing students. Understanding of the (implicit)
assumption underlying this matrix or model, under what conditions it might be
useful and the difficulties in using this simple tool, is, however, often modest.
For example, the axis indicating “relative market share” more or less implies
that the matrix (model) applies in oligopolistic markets. For example, if in a
large number market, the largest firm has a 3 percent market share, and the
second largest firm a 2 percent market share, the relative market share 3/2 = 1.5
is probably without interest. In many markets it is also difficult to assess
market share correctly. For example, a company producing special equipment
assessed its market share to be approximately 80 percent. Through timeconsuming and detailed analyses by some of our PhD students, the revealed
“truth” was a market share around 25 percent. For firms operating in
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European
stagnating markets — as was the actual firm — such a difference may have
Marketing
36.3
’
Concepts are the “building blocks” of any model, theory or explanation
serve several important functions. For example, the individual categorizes
captures her or his “reality” with the concepts held. Because concepts held
how they are used vary across actors, what aspects and how “reality”
Journal of
368
dramatic implications.
and
and
and
are
captured (may) vary across individuals — even when embedded in the same
environments (e.g. by attending a marketing presentation). Being exposed to a
new marketing concept or idea may create interest and enthusiasm, and may
thus be useful. In most cases, however, new marketing concepts must be given
content {as will be discussed below) and adjusted to the actual context where
the actor operates to become useful. The concepts held by marketing actors
may also differ substantially from the theoretical concepts developed and
offered by marketing academicians. Rosch (1978) has argued that actors’
categories and concepts mainly develop through interactions with their
environments. When first exposed to new theoretical concepts, e.g. “market
orientation” or “total quality management”, they are almost like empty labels.
Over time marketers, as well as other individuals, may assign meanings to the
new concepts, which may deviate substantially from the intended theoretical
meanings. For example, a recent study conducted among managers embedded
in turbulent environments showed that they all had adopted the term “market
orientation”, that they differed in their ambiguous understanding (and use) of
the market orientation construct, and that they partly differed in their
understanding of what is advocated in the marketing research literature (e.g.
Jaworski and Kohli, 1993). For example, they did not explicitly take specific
competitors into account, but rather tried to assess market trends and
developments (which can be explained by highly competitive markets
encompassing a very large number of suppliers offering the same products),
and that supply of raw materials — which has not been included in the academic
research literature — was considered extremely important for them to be market
oriented (Ottesen and Grenhaug, 2001). In fact, they had adopted the label
“market orientation”, and assigned meanings to this label that made sense for
them in the surrounding market environments in which they are embedded.
Production and use of knowledge
When teaching and disseminating marketing knowledge the emphasis is often
to acquaint the audience with “useful tools”, e.g. specific concepts, theories and/
or models. When taught concepts, theories, models and so on are general, ie.
they are assumed to be applied by multiple users for a variety of purposes, they
are independent of the context of the use and users. Examples of some general
concepts are “market”, “competition” and “value chain”. These are all wide
concepts (almost) without content. Firms and marketers do not, however,
operate in a vacuum, they are context bound, and they must select concepts,
theories, models and methods from the “tool-box” available and adjust the
selected tools to their problem.
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Figure 1 illustrates the differences between construction and use of
marketing “theory” (knowledge).
When constructing marketing “theory”/knowledge one
specific observations or assumptions to some more general
move from the specific and concrete to the general and
Figure 1). Use of knowledge (see (2) in Figure 1) implies
Is marketing
knowledge
useful?
moves from some
explanations, ie. a
abstract (see (1) in
selecting from this
general and abstract “tool-box” adequate concepts, theories and methods and
369
adjusting them to the actual problem. This is a move in the opposite direction,
from the general and abstract to the concrete and specific. This is a demanding
task, which requires substantial knowledge and training. It is also extremely
important, hecause any theory, model or method, even though designed to be
useful for specific tasks, will have limitations. This ability to select in a
competent way from the great arsenal of marketing “tools” requires insights
and is crucial for adequate knowledge use.
Example: the case of water leakage
Below is reported a hypothetical, not very likely example to illustrate the above
arguments: The present author lives in Bergen, a city located in the Southwestern part of Norway. Bergen is known as a very rainy city, and almost all
houses here are equipped with basements. One day my basement is flooding.
My wife and 1 are watching the rising water. She gives me the following
instructions (as wives often do when couples have been married for eternity):
“Do something, Kjell” I'm definitely not a practical craftsman. However, | was
able to recognize that this was a plumber problem. The yellow pages were
consulted and, after several calls, we succeeded in getting hold of one (a
plumber). Two hours later — and half a meter more of water — the plumber
arrived. To my surprise he started banging with a big hammer, and he even
tried to use a saw. This example is, of course, very unlikely, but illustrates
incorrect choice and use of tools. In real life it would probably be difficult to
come across an example like this. There are several reasons why. Craftsmen
like plumbers, carpenters and painters are dealing with concrete, observable
things. Also, an important part of their training and knowledge (competence)
acquisition is through observations, imitations and corrections by more
experienced workers.
Marketing problems and tools in contrast are abstract. In addition, we often
teach and instruct by showing bunches of transparencies, if not having become
_—»
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/
/
/
4
“Theory”
|
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Sh
BL
|
oy
2)
ih
\
\
:
Observations/
og
axioms
»
Figure 1.
Construction and use of
marketing “theory”
Problem
(knowledge)
Risa
BER
pe
EE
A
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European
Journal of
Marketing
36.3
370
more “advanced” by offering glossy Powerpoint demonstrations. The way from
the general and abstract “tool-box” can be both long and difficult, which may
result in difficulties in adequate problem identification, as well as difficulties in
choosing and making adequate use of marketing “tools”. Thus adequate
knowledge use unplies:
«correct identification of problem;
«correct choice of “tools” and
«correct use of “tools”.
Some examples
In Norway there are still two different types of banks regulated by separate but
very similar laws: business banks and saving banks. Both business and saving
banks serve private persons and households and business. Some years ago the
association for the saving banks conducted an analysis of the market
competition. Only saving banks were included(!), even though the association
employed several persons with degrees in business and marketing. The
mistake is obvious. Saving and business banks compete, and competitors also
includes other financial institutions. Apparently the period of “marketing
myopia” (Levitt, 1960) is not over.
Gronhaug and Haukedal (1997) conducted a quasi-experimental study to
examine whether and how surveys with customers were used by firms to
imprave their product/service and performance. Interesting and surprising
findings were that the subjects included did not even understand simple
presentations of the research findings, e.g. the reporting of standard deviations
— nn spite of being exposed to statistics in their business education.
In another study Haukedal and Grenhaug (1995) examined how third-year
business students exposed to an extensive course in marketing strategy and
experienced managers with the same educational background tackled
modestly structured market strategy problems. The reported findings showed
that the expert managers, benefiting from their knowledge of the actual
context, recognized the various situations exposed and made specific (and
adequate) interpretations in contrast to the novices (students). The expert
managers were also much more specific and adequate in their problem
definitions and identification of causes. In fact, almost no useful knowledge use
among the novices (students) could be traced. One conclusion from this study is
that “classroom” lectures (knowledge) do not easily result in useful knowledge.
Discussion
It is commonly believed that marketing knowledge 1s (and should be) useful. As
emphasized above, the concept of “useful knowledge” is an ambiguous one.
Meanings aboul what constitutes useful knowledge are multiple, and no one
agreed definition of what it is — or should be — can be said to exist. For the
present author, viewing marketing primarily to be a business discipline,
marketing knowledge should be helpful to businesses in understanding their
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customers and business environments, allowing business firms to make wise
decisions, take successful actions and thus keep their competitive edge.
As demonstrated above, however, the route from marketing knowledge
produced and disseminated by marketing academicians to becoming of
practical use can be both time-consuming and cumbersome. To become useful
the potential user must really have command over the knowledge to be used.
Here a distinction can be made between levels of insights, varying from the
ability to memorize, understand and really be able to apply the knowledge. In
business useful knowledge relates in some way or other to adequate
applications. Because firms are embedded
in hostile, ever-changing
environments, knowledge about the actual context will — (in most cases) also be
needed in addition to the general marketing knowledge. This corresponds to
what March (1978) has termed “contextual rationality”, i.e. to behave in a
rational or goal-directed way, detailed knowledge about the actual context is
needed. In addition the actor needs to know how to go about things, or how to
proceed. This corresponds to what Simon (1978) has termed “procedural
rationality”. A great deal of the academic marketing knowledge produced and
taught 1s procedural.
To make “classroom” knowledge useful, the actor will often need timeconsuming and focused experiences in applying the knowledge to tasks/
problems in the actual context. If marketing knowledge is to yield competitive
advantage, it must also be superior, probably developed to the degree of expert
knowledge. From the extant literature of expertise, it is known that experts in
many situations perform better than non-experts in recognizing and making
sense of stimuli and problem solving, ie. activities of key importance for
marketers (e.g. Shanteau, 1992). From the above discussion it also follows that
to make marketing knowledge useful, the user must also take this task
seriously. We as marketing academicians also have our obligations in
explaining and showing the practical use of marketing knowledge. This is not
“practice” as contrast to “theory”, but practical and useful applications guided
by theorv[3].
Is marketing
knowledge
useful?
)
371
Notes
1.
The concepts “theory” and *models” are, for the present purpose, incorrectly used as being
Synonyms.
fo¥)
2.
To be termed a theory some authors require a set of interrclated, well-defined concepts,
derived (and tested) propositions to capture the phenomenon under scrutiny (e.g.
Frankfurt-Nachmias and Machmais, 1996). Few theories in marketing exist that satisfy
such requirements (cf, Zaltnan ef al., 1982).
This corresponds to the notion of “praxis” as suggested by Aristotle, Le. theory that has
found practical applications.
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European
Journal of
Marketing
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402
Evert Gummesson
Dr Evert Gummesson is Professor of Service Management and Marketing at
Stockholm University, Sweden. After graduation he worked for 25 years as
marketing manager and management consultant. His research is directed to
relationship marketing, CRM, and quality management with a particular
emphasis on services. In 1977 he published the first book on services marketing
in Scandinavia, and in 2000 he received the American Marketing Association's
Award
for Leadership
in Services Marketing.
His book
Total Relationship
Marketing has won two prizes for excellence, and his book Qualitative Methods
in Managemen! Research has been reprinted ten times. He has authored more
than 20 books and numerous articles in refereed journals, such as European
Journal of Marketing, Journal of the Academy of Marketing Science, Journal of
Marketing Management, Managemen! Decision, Long Range Planning and
Service Industry Management. He is a member of editorial and review boards
of, among others, Journal of the Academy of Marketing Science, Journal of
Marketing Management, Journal of Service Research and the recently launched
Marketing Theory and Journal of Relationship Marketing.
Nigel F. Piercy
Nigel F. Piercy BA, MA, PhD is Professor of Strategic Marketing and Director
of the Strategic Sales Research Consortium at Cranfield School of Management.
He has also been visiting professor at Texas Christian University, the Fuqua
School of Business at Duke University in North Carolina, the Columbia
Graduate School of Business in New York, and at the University of California,
Berkeley. His research interests are in marketing implementation strategy and
he is currently focusing on a number of projects related to sales effectiveness
and the sales/marketing interface. His most recent books are Markel-led
Strategic Change: A Guide to Transforming the Process of Going to Market
(Butterworth-Heinemann, 2002) and Tales From the Marketplace: Stories of
Revolution, Reinvention and Renewal (Butterworth-Heinemann, 1999). He is
writing a book on Tofal Integrated Marketing (Free Press, 2002) with
colleagues from Columbia Graduate School of Business, and has joined David
W Cravens as co-author of Strategic Marketing, 7th ed. (Irwin/McGraw-Hill,
2002).
Kjell Grenhaug
Kjell Grenhaug is Professor of Business Administration at the Norwegian
School of Economics and Business Administration, Bergen. He holds a Master's
degree in Business Administration and a graduate degree in marketing from
the school, an Ms in sociology from the University of Bergen, and did his
postgraduate studies in quantitative methods at the University of Washington.
He has been visiting professor at the universities of Pittsburgh, Illinois at
Urbana-Champaign, California, Kiel, Innsbruck, and at Copenhagen and Aston
Business School. He is also an Adjunct Professor at the Helsinki School of
Economics and Business Administration and at the faculty of Bode Graduate
—
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School of Business, and is hononary Doctor at Turku School of Economics and
Business Administration. Most recently he received the prize for excellence in
research from his institution awarded every fifth year. His research spans a
great variety of marketing problems, corporate strategy, industry studies and
multiple evaluation studies. His publications include numerous articles in
leading American and European journals and contributions to many
About the
authors
international conference proceedings. He is the author or co-author of 18 books.
403
John A. Murray
John A. Murray is professor of business studies at the school of business
studies, University of Dublin, Trinity College, Dublin. His research interests are
in the relationship between markets and strategy and in the evolution of
business systems.
Aidan O'Driscoll
Aidan O'Driscoll is a senior lecturer in strategic management and marketing at
the Dublin Institute of Technology. He is co-author with John A. Murray of
Managing Marketing: Concepts and Irish Cases (2000, 2nd ed, Gill and
Macmillan) and Strategy and Process in Marketing (1996, Prentice Hall Europe)
His research interests examine the relationship of competence-based strategic
management to marketing.
Ann Torres
Ann Torres is lecturer in marketing at the National University of Ireland,
Galway, Ireland. Her research interests are in entrepreneurial strategies and
innovative marketing practices.
Robin Wensley
Robin Wensley is Deputy Dean and Professor of Strategic Management and
Marketing at Warwick Business School. He is a member of the the Council of
the ESRC and the Senate of the Chartered Institute of Marketing and was a
Board member of the ESRC Research Grants Board from 1991 to 1995. His
research and consultancy interests include marketing strategy and
evolutionary processes in competitive markets, investment decision making
and the assessment of competitive advantage. He has published a number
articles in the Harvard Business Review, the Journal of Marketing and the
Strategic Management Journal, and has twice won the annual Alpha Kappa Psi
award for the most influential article in the US Journal of Marketing as well as
the Millenium Prize for the best article in the UK journal of Marketing
Management.
His recent books include (with B.A. Weitz), Handbook of
Marketing, Sage: London 2002, and (with D. Brownlie, M. Saren and
R. Whittington),
Rethinking Marketing:
Towards
Critical Marketing
Accountings, Sage, 1999. He is co-editor of the Journal of Management Studies.
|]
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