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Changing Market Relationships in the Internet Age

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Jean-Jacques Lambin

Preface

Texte intégral

1Three major evolutionary changes are deeply modifying today’s business environment: (a) the globalisation of the world economy, (b) the development of the Internet technology and (c) the emergence of new values promoting a market economy model aimed at sustainable development. These trends open new markets, change the competitive landscape, stimulate the development of more responsible management models, affect the way companies interact with customers and alter the balance of power among market players. The analysis of the world market as an interconnected global economy has the merit to evidence the shortcomings of the traditional marketing management concept as a normative framework that provides an inadequate and an incomplete view of today’s business complexity.

2During years, the traditional marketing management concept has been widely accepted in industrialised countries as an adequate business philosophy in a market economy system. For over sixty years now, managers have been exhorted “to put the customer at the top of the organisational chart” and to use the paradigm of the 4Ps to implement such customer oriented strategy. In reality, market relationships have been dominated and regulated by the marketing laws. Traditional marketing has placed the emphasis on creating market power to influence or to manipulate demand to match supply and was developed within the framework of a top-down business model where companies make decisions about what to produce for passive audiences to consume. The Internet technology is changing this top-down relationship, giving rise to lateral and more equalitarian relationships.

3Many organisations today recognise their needs to become more market responsive in view of the growing complexity global markets in which they operate. The Internet technology expands the geographical size of the market, gives easier access to information, introduces new market players and new forms of collaboration, modifies consumers’ behaviour and reinforces the power of the market over the power of the firm. It creates virtual markets where consumers can find customised solutions to their problems, which cut across traditional market boundaries, thereby matching the supply market concept based on products and services against the consumers’ cognitive market space concept based on their needs and perceptions. Internet is an important countervailing force offsetting the market power of dominant brands or firms. In today’s information society, the Internet technology is a great enabling tool for implementing a much stronger market orientation business philosophy which is more under the customer’s control.

4The objective of this book is to revisit the traditional marketing management concept (Chapter 1) and to propose as an alternative the market orientation concept. The development of the Internet technology is shaping two types of markets: global traditional markets and global electronic markets. In this dual trading arena (Chapter 2), traditional market participants have changing roles and new market actors are emerging. Given the increased complexity of the global market, being customer-oriented is not enough and other market orientations - called sub-orientations - have to be adopted by the market-driven firm (Chapter 3). The Internet technology is changing market relationships among market participants and its impact on the main decisions of strategic and operational marketing is analysed in Chapter 4. Finally, the issue of marketing performance measurement is raised (Chapter 5). With the rising share of marketing expenditures in the firm’s total budget, pressure grows from shareholders to quantify operational marketing’s contribution to the bottom line.

5By way of conclusion, ten recommendations are proposed to upgrade the marketing function in order to reinforce its capacity to cope with the increased complexity of the global market.

Acknowledgements

6This book is an academic essay. It presents forward looking after-thoughts on the evolving role of marketing in today’s economy. Academic essays tend to be discursive. They begin with a review of the discipline’state of the art and contain extensive bibliography. Acknowledging opposing views and either refuting them or conceding to them is a common practice in this form of essay. By tradition, an essay is a piece which does not claim to cover exhaustively the topic.

7This book would not have been possible without the institutional support of the Université degli di studi di Milano-Bicocca who welcomed me as Professore Ordinario after I reached teaching retirement age according to the Belgian law at the Université Catholique de Louvain.

8My gratitude goes first to Silvio M. Brondoni, a long time colleague and friend and to the members of ISTEI, in particular Margherita Corniani, Emanuela Tesser and Flavio Gnecchi. I am also obliged to Michele Zenga and to Marisa Civardi, successive Presidents of the Faculty of Economia for their support.

9I thank Valérie Swaen and Isabelle Schuiling, both from Louvain-IAG School of Management, and Carlo Gallucci from ESADE-Barcelona for their critical and positive remarks on an early version of this book. Special thanks go to Brigitte Cerfontaine from P&G who has found the time to read my final text and to make constructive comments and suggestions.

10Bousval, June, 2008

© Presses universitaires de Louvain, 2008

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