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The Changing Role of Marketing in the Corporation

Frederick E. Webster, Jr.

The Journal of Marketing
Vol. 56, No. 4 (Oct., 1992), pp. 1-17
(article consists of 17 pages)

Published by: American Marketing Association


Frederick E. Webster, Jr.
For the past two decades, some subtle changes in the concept and practice of marketing have been fundamentally reshaping the field. Many of these changes have been initiated by industry, in the form of new organizational types, without explicit concern for their underlying theoretical explanation or justification. On the academic side, prophetic voices have been speaking (Arndt 1979, 1981, 1983; Thorelli 1986; Van de Ven 1976; Williamson 1975) but seldom heard because, representing several different disciplines, they did not sing as a chorus. More basically, perhaps, few listeners were ready to hear the message or to do the intellectual work necessary to pull the several themes together. Like the Peruvian Indians who thought the sails of the Spanish invaders on the horizon were some phenomenon of the weather and did nothing to prepare themselves for attack (Handy 1990), marketers may ignore some important information in their environment simply because it is not consistent with their past experience.
The purpose of this article is to outline both the intellectual and the pragmatic roots of changes that are occurring in marketing, especially marketing management, as a body of knowledge, theory, and practice and to suggest the need for a new paradigm of the marketing function within the firm. First, the origins of the marketing management framework, the generally accepted paradigm of the marketing discipline for the past three decades, are considered. Then shifting managerial practice is examined, especially the dissolution of hierarchical bureaucratic structures in favor of networks of buyer-seller relationships and strategic alliances. Within those new forms of organization, the changing role of marketing is discussed and a reconceptualization of marketing as a field of study and practice is outlined.
Marketing as a Social and Economic Process
It is sobering to recall that the study of marketing did not always have a managerial focus. The early roots of marketing as an area of academic study can be found, beginning around 1910, in Midwestern American land grant universities, where a strong involvement with the farm sector created a concern for agricultural markets and the processes by which products were brought to market and prices determined. The analysis was centered around commodities and the institutions involved in moving them from farm, forest, sea, mine, and factory to industrial processors, users, and consumers. Within this tradition, three separate schools evolved that focused on the commodities themselves, on the marketing institutions through which products were brought to market, especially brokers, wholesalers, and retailers in their many forms and variations (Breyer 1934; Duddy and Revzan 1953), and finally on the functions performed by these institutions (McGarry 1950; Weld 1917). All of these approaches tended to be descriptive rather than normative, with the functional being the most analytical and leading to the development of a conceptual framework for the marketing discipline (Barters 1962; Rathmell 1965).

These early approaches to the study of marketing are interesting because of the relative absence of a managerial orientation. Marketing was seen as a set of social and economic processes rather than as a set of managerial activities and responsibilities. The institutional and functional emphasis began to change in 1948, when the American Marketing Association (1948, p. 210) defined marketing as:
The performance of business activities directed toward, and incident to, the flow of goods and services from producer to consumer or user.
This definition, modified only very slightly in 1960, represented an important shift of emphasis. Though it grew out of the functional view, it defined marketing functions as business activities rather than as social or economic processes. The managerial approach brought relevance and realism to the study of marketing, with an emphasis on problem solving, planning, implementation, and control in a competitive marketplace.
Marketing Management

The managerial approach to the study of marketing evolved in the 1950s and 1960s. Several textbooks using a marketing management perspective appeared during this period (Alderson 1957; Davis 1961. Howard 1957; Kotler 1967; McCarthy 1960). These early managerial authors defined marketing management as a decision-making or problem-solving process and relied on analytical frameworks from economics, psychology, sociology, and statistics. The first marketing casebook, incorporating a managerial framework by definition, had emerged from of the Harvard Business School very early (Copeland 1920), but without any descriptive material or analytical framework to accompany the cases. Marketing management became a widely accepted business function, growing out of a more traditional sales management approach, with an emphasis on product planning and development, pricing, promotion, and distribution. Marketing research gained prominence in management practice as a vehicle for aligning the firm's productive capabilities with the needs of the marketplace. The articulation of the marketing concept in the mid to late 1950s posited that marketing was the principal function of the firm (along with innovation) because the main purpose of any business was to create a satisfied customer (Drucker 1954; Levitt 1960; McKitterick 1957). Profit was not the objective; it was the reward for creating a satisfied customer.
The managerial focus was not readily accepted by everyone in academic circles, nor was the marketing concept completely adopted by industry (McNamara 1972; McGee and Spiro 1988; Webster 1988). In academia, the functionalists and institutionalists held their ground well into the 1960s, stressing the value of understanding marketing institutions and functions and viewing marketing from a broader economic and societal perspective. Over the previous 50 years, a substantial body of theory and empirical knowledge had been developed and mature marketing scholars felt compelled to defend and protect it. The argument against the managerial point of view centered on its inability to consider the broader social and economic functions and issues associated with marketing, beyond the level of the firm. For example, the Beckman and Davidson (1962) text, built around a functionalist perspective, and the most widely used text in the field at the time, was promoted as follows: "Balanced treatment of the development and the present status of our marketing system; Conveys a broad understanding of the complete marketing process, its essential economic functions, and the institutions performing them; Strengthens the social and economic coverage of marketing in all its significant implications; Proper emphasis accorded to the managerial viewpoint" (advertisement, Journal of Marketing, April 1962, p. 130). It is the last phrase, "proper emphasis," that implies the criticism that the managerial approach, by itself, is incomplete.
The analytical frameworks of the new managerial approach were drawn from economics, behavioral science, and quantitative methods. The incorporation of the behavioral and quantitative sciences gave important legitimacy to marketing as a separate academic discipline Such frameworks were consistent with the very strong thrust of the 1960s toward more rigorous approaches in management education, encouraged by two very influential foundation studies (Gordon and Howell 1959; Pierson 1959). These studies advocated education based on a rigorous, analytical approach to decision making as opposed to a descriptive, institutional approach which, it was argued, should be held to "an irreducible minimum" (Gordon and Howell 1959, p. 187). The managerial perspective became the dominant point of view in marketing texts and journals, supported by management science and the behavioral sciences.
Marketing as an Optimization Problem
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