Market orientation: The construct, research propositions, and managerial implications

Market Orientation: 

The Construct, Research Propositions, and Managerial Implications

by

Sandra Fricke

Table of Contents

1. Introduction: What does Market Orientation mean? 2

2. Marketing Concept 2
2.1 Four main pillars
2.2 Hurdles a company has to face

3. Market Intelligence and the Business Marketing System 7

4. Market Orientation: the construct 8
4.1 Antecedents to a Market Orientation
4.2 Consequences of a Market Orientation

5. Implementing the New Marketing Concept 12

6. Conclusion 13

List of Literature 14

1. Introduction: What does Market Orientation mean?

Very little attention has been given to organizational processes, such as market orientation. That is one reason why hardly anybody can explain the term. Market orientation means the implementation of the marketing concept and represents a long-term advantage. Because a market orientation is not easily engendered, it may be considered an additional and distinct form of sustainable competitive advantage. In this paper the domain of the market orientation construct will be clarified and a working definition provided.

2. Marketing Concept

The marketing concept is a business philosophy and its central tenets crystallized in the mid-1950s.

"The marketing concepts holds that the key to achieving organizational goals consists in determining the needs and wants of target markets and delivering the desired satisfactions more effectively and efficiently than competitors."¹

The marketing concept has been expressed in many colourful ways:

• "Meeting needs profitably."
• "Find wants and fill them."
• "Love the customer, not the product."
• "Have it your way." (Burger King)
• "You′re the boss." (United Airlines)
• "To do all in our power to pack the customer′s dollar full of value, quality and satisfaction." 

(J.C. Penny)

The commitment to innovation and customer-oriented business decision making is only the first step in implementing the marketing concept. The next step is to shift the focus away from sales volume and toward profitability. When managing for profitability, not sales volume, the firm is focusing on the value its products create for customers in the competitive marketplace. Theodore Levitt drew a perceptive contrast between the selling and marketing concepts.

"Selling focuses on the needs of the seller; marketing on the needs of the buyer. Selling is preoccupied with the seller′s need to convert his product into cash; marketing with the idea of satisfying the needs of the customer by means of the product and the whole cluster of things associated with creating, delivering and finally consuming it."²

[...]

1 John B. McKitterick (1957): American Marketing Association, Chicago, pp. 71-82

2 Theodore Levitt: Marketing Myopia, p. 50