Managerial decision making in marketing: The next research frontier☆
Introduction
Reflecting on the current state of research in marketing, it occurred to me that notwithstanding the huge progress that has been made over the last 50 years, there is one particular area that we have not covered in any depth: managerial decision making in marketing. I have chosen this as the subject of my paper because (i) This topic is of utmost importance for marketing; (ii) There are excellent prospects for doing interesting and challenging research; and (iii) There are many connections with my earlier work on decision making in marketing.1 I will offer a new perspective on managerial decision making in marketing and, at the same time, try to include some of what I have learned about the field of marketing over the last 40+ years.
The quality of managerial decision making is the single most determining factor for the success of marketing management. A myriad of factors influence the outcomes of a marketing policy, for example, the purchasing behavior of customers, actions of competitors and resellers, the economy, the weather, societal processes, and many others. Moreover, all of these factors interact in complex ways and contain a high degree of uncertainty. Even if there is a lot of information about consumer decision making, and even if there are sophisticated models describing the processes in the market, in the end, it is the marketing decision maker who has to evaluate the alternatives, judge the evidence and uncertainties, and decide on the marketing policy and marketing instruments.
Marketing decision makers bring an impressive set of assets to the table. Usually, they know a lot about marketing phenomena and marketing processes in general. Mostly, they also have industry-specific marketing knowledge, have many years of experience in practice, and a well-developed marketing intuition. Marketing decision makers can deploy all of these resources to convert the information about their markets into effective decisions. However, how do marketing decision makers actually do this? Furthermore, when does this lead to good decisions, and when does it lead to bad decisions? It is important to have insight into how marketing managers make decisions to improve the quality of marketing decision making and to design marketing management support systems to help marketing managers with specific marketing decision tasks (Wierenga and Van Bruggen, 2000, Van Bruggen and Wierenga, 2010). After all, if you want to support or improve a process, a good understanding of that process is needed in the first place.
This paper argues that we do not know enough about managerial decision making in marketing, and it outlines research directions that can help to improve this situation. The plan of the paper is as follows. First, we look at the attention for managerial decision making in the marketing literature. This is followed by a discussion of existing work on managerial decision making in marketing. The main part (Section 4) of the paper is a review of new and promising areas for research on marketing decision making, including the formulation of specific research questions, and a discussion of the available methodologies for answering them.
Section snippets
A brief history of the attention for managerial decision making in marketing
In the 1960s, marketing went through a major change. Until then, marketing had been primarily a descriptive field that studied the flow of goods from the original producer to the ultimate consumer (marketing as distribution). The invention, in the 1960s, of the marketing concept and the marketing mix caused a radical change in the orientation of marketing. Marketing became a functional area of the management of a company; marketing became marketing management. With the wants and needs of
Existing work on managerial decision making in marketing
The work that we discuss in this section can be classified into descriptive and normative approaches. In addition, we discuss the concept of bounded rationality in the context of marketing.
New directions for research in managerial decision making in marketing
Having discussed the approaches to marketing decision making thus far, we now turn to a prospective view. Earlier, we emphasized the importance of more insight into marketing decision making. Fortunately, several developments make it easier to obtain this insight. First, there has been significant progress in behavioral decision making, which is very relevant to marketing. In particular, this refers to work on the following topics: (i) the dual-process model of decision making; (ii) learning;
To conclude
We have now discussed the developments on the conceptual side, leading to a set of important research questions, as well as the developments on the methodological side. The paper closes with two observations.
First, it is crucial that behaviorally oriented researchers in marketing take up the study of managerial decision making in marketing. Thus far, researchers have almost exclusively been focused on the study of consumer behavior. In consumer behavior, data collection is traditionally easier,
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The author thanks Gilles Laurent, Don Lehman, Gary Lilien, and Marnik Dekimpe (Editor of IJRM) for their valuable comments on an earlier version of this paper.