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The author of the paper "The Development of Entrepreneurial Marketing" begins with the statement that the mode of marketing policies used in each firm cannot be standardized. Of course, there is a framework in which most marketing strategies are incorporated: marketing in its traditional context…
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The Development of Entrepreneurial Marketing
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? The Development of Entrepreneurial Marketing The mode of marketing policies used in each firm cannot be standardized. Of there is a framework in which most marketing strategies are incorporated: marketing in its traditional context. Through the decades the need for covering special needs of firms has led to the development of another form of marketing, which has been quite popular among entrepreneurial/ small businesses: the entrepreneurial marketing. The development of entrepreneurial marketing is presented and analyzed in this paper using relevant literature. In addition, two academic articles have been chosen and are critically analyzed aiming to highlight critical aspects of the particular mode of marketing. It is proved that the increase of popularity of entrepreneurial marketing is continuous even if its use, as compared to that of traditional marketing, is still limited; the lack of managers’ awareness of the benefits of entrepreneurial marketing seems to be the key reason for this phenomenon. 1. Introduction The development of effective marketing strategies is depended on the needs of each organization but also on the conditions in the organizational environment. In practice, it has been proved that not all marketing frameworks are appropriate for organizations worldwide. Current study focuses on the characteristics and the performance of a particular mode of marketing: the entrepreneurial marketing. The specific type of marketing seems to be highly depended on entrepreneurship and innovation. The review of the literature developed in this field verifies the uniqueness of entrepreneurial marketing and its differentiation from traditional marketing. Two studies focusing on entrepreneurial marketing are critically reviewed in this paper; the study of Kolabi et al. (2011) and the study of Ionita (2012). Primarily, relevant literature is used for showing the key characteristics and the practical implications of entrepreneurial marketing. In this way, the evaluation of the findings of the studies reviewed in this paper, as presented above, becomes easier. Both these studies can be characterized as successful in terms of the aspects of entrepreneurial marketing highlighted in each one of them. However, the existence of certain gaps in regard to entrepreneurial marketing has been also verified, a problem that can be resolved through the recommendations provided in the last section of this study. 2. Entrepreneurial Marketing – Literature Review 2.1 Entrepreneurial Marketing – overview and key theories The introduction of entrepreneurial marketing, as a critical part of the marketing process, has been related to the following phenomenon: the increased intervention of entrepreneurs in the marketing plans of their businesses (Sharman 2011). Moreover, it has been proved that entrepreneurial marketing focuses on the increase of a firm’s existing customer database ‘through innovative approaches to risk management, resource leveraging and value creation’ (Morris et al. 2002, p.5, cited in Sharman 2011, p.153). From another point of view, entrepreneurial marketing has been characterized as a term reflecting the ‘development of marketing in the context of information intensity and ongoing change in the organizational environment’ (Welsh 2004, p.97). According to the above definition, entrepreneurial marketing needs to be related not only to the development of a firm’s communication with its stakeholders but also to the identification of markets in which a firm could have important prospects for long term growth (Welsh 2004). In addition, entrepreneurial marketing should focus on the increase of customer value, either in the short or the long term (Welsh 2004). According to Leadley and Forsyth (2004) entrepreneurial marketing policies would be identified in all organizations. The above researchers explain that in order to keep their competitiveness in the modern market all businesses need to focus on ‘marketing and innovation’ (Leadley and Forsyth 2004, p.8). These two activities are the core elements of entrepreneurial marketing (Leadley and Forsyth 2004). This fact leads to the assumption that entrepreneurial marketing is present in all businesses (Leadley and Forsyth 2004). From a similar point of view, it is noted that the promotion of entrepreneurial marketing in a particular organization is highly depended on the leader’s ability to ‘identify opportunities and make appropriate use of available resources’ (Panda 2009, p.6). The strong relationship between entrepreneurial marketing and leadership, as explained above, leads to the following assumption: entrepreneurial marketing plans cannot be developed in firms where leadership style is not aligned with organizational goals and needs and in firms where the resources available for supporting marketing plans are quite limited. The critical role of entrepreneur in the development of successful entrepreneurial marketing plans is also highlighted in the study of Stokes, Wilson and Mador (2010). In the above study it is made clear that entrepreneurial marketing is mostly based on the abilities and skills of entrepreneur especially in regard to the promotion of innovation and to the identification of unique market opportunities (Stokes, Wilson and Mador 2010); entrepreneurial marketing is not based, at least not highly, on the availability of funds, as marketing in its classic form does (Stokes, Wilson and Mador 2010). The terms of entrepreneurial marketing could be understood by reviewing the diagram presented in Figure 1 (Appendices) where the formation of entrepreneurial marketing strategies is explained. The entrepreneurial marketing process could be made clear through Figure 2 (Appendices) where an indicative form of the entrepreneurial marketing framework is presented. In any case, the targets of entrepreneurial marketing are similar to those of the traditional marketing; as also in the case of traditional marketing, in entrepreneurial marketing emphasis is given on ‘attracting and retaining customers’ (Stokes, Wilson and Mador 2010, p.258). The development of entrepreneurial marketing, in the context of the modern market, has been based on theories that are also used in traditional marketing. Reference should be made in particular to the market process theory of Kirzner. The above theory focuses on the terms under which ‘knowledge is distributed in society’ (Picot, Reichwald and Wigand 2008, p.29). In the context of this theory, successful marketing plans are those that can ensure that products and/ or services available in a particular market can ‘meet the expectations of entrepreneurs in regard to these products’ quality or characteristics’ (Picot, Reichwald and Wigand 2008, p.29). It is assumed that, effective marketing plans are related to effective entrepreneurship styles, as these styles reflect the ability of an entrepreneur ‘to promote innovation and to identify key opportunities in markets worldwide’ (Acs and Audretsch 2010, p.226). The concept of entrepreneurship, as related to the market process theory of Kirzner, is quite broad incorporating not only business leaders but also consumers who can be also supporters of innovation (Acs and Audretsch 2010). The particular view is aligned with the view of Bjerke and Hultman in regard to the scope of entrepreneurial marketing. Indeed, the above researchers support that entrepreneurial market is based on the cooperation between entrepreneurs and customers ‘for the creation of value’ (Casson, Yeung and Basu 2008). It should be noted that entrepreneurial marketing plans can be successful only if they are able to respond to a firm’s needs for continuous innovation. However, such plans should also promote communication; communication may not be a priority for entrepreneurial marketing but it is a key element of traditional marketing (Donnelly 2009). In addition, all marketing plans need to focus on the achievement of specific targets, such as the increase of sales or the increase of existing customer base by specific percentage within a specific period of time (Wolff 2009). Also, entrepreneurial marketing plans, as also the traditional marketing plans, need ‘to be characterized by consistency’ (Wolff 2009, p.15). In practice, it has been proved that entrepreneurial marketing can be more effective than traditional marketing (Qureshi and Mian 2010); for example, a relevant research has led to the assumption that the use of entrepreneurial marketing by new ventures can reduce ‘the risks of potential failures by a rate of 60%’ (Longman 2011, p.11). In any case, the differences between traditional marketing and entrepreneurial marketing can be many. For example, entrepreneurial marketing focuses on the achievement of competitive advantage so that the future performance of a product/ service is fully controlled (Longman 2011); for traditional marketing the ability to foresee the future status of a market and to estimate the risks involved in the promotion of a product/ service is of key importance (Longman 2011). In addition, entrepreneurial marketing is not limited to ‘the enhancement of communication and customer value’ (Longman 2011, p.12) but refers also to the introduction of changes in the organization so that the success of this organization’s marketing plans is secured (Longman 2011). Another important characteristic of entrepreneurial marketing, at least in its current form, is the following one: entrepreneurial marketing seems to be more effective for small and medium enterprises (Bettiol, Di Maria and Finotto 2012 and Mayasari, Wiadi and Maharani 2009). 2.2 The application of Entrepreneurial Marketing in practice The characteristics and the requirements of entrepreneurial marketing can be made clear by referring to certain businesses that have highly supported the particular type of marketing. Reliance Textile Industries is a major competitor in the global textiles industry. The firm is based in India but its activities are expanded in numerous markets, including the British and the American market (Saxena 2005). The firm has used entrepreneurial marketing for improving its market position: at the first level, the firm established a brand, Vimal, for the promotion of its products; then, the firm used entrepreneurial marketing for entering the telecommunications industry, through the brand Infocom (Saxena 2005). In general, it has been proved that entrepreneurial marketing is highly preferred by small businesses where emphasis is given on ‘personal contact and word-of-mouth marketing’ (Stokes, Wilson and Mador 2010, p.261). According to Pride and Ferrell (2011) there are certain firms that have highly emphasized on the involvement of entrepreneurship in marketing and on innovation in regard to the marketing plans chosen; the firms ‘Cirque de Soleil and Womenkind’ (Pride and Ferrell 2011) are highly based on entrepreneurial marketing, as related to innovation and entrepreneurship. The marketing choices of McDonals are also related to entrepreneurial marketing (Dana 2007). In fact, it was McDonald’s leader, Ronald McDonald who emphasized on entrepreneurial marketing as a framework for promoting innovation, as combined with the view of McDonald in regard to successful marketing practices (Dana 2007). E-Bay has focused on entrepreneurial marketing for enhancing a new industry, the online auction industry (Morris, Kuratko and Covin 2010); e-Bay has emphasized on a potential of entrepreneurial marketing, as described above, different from that used in the marketing plans of Cirque du Soleil (Morris, Kuratko and Covin 2010). The latter focused on ‘the expansion of existing market boundaries’ (Morris, Kuratko and Covin 2010, p.102) and not to the presentation of industrial activities that have been totally new in markets worldwide, as in the case of e-Bay (Morris, Kuratko and Covin 2010). 3. Critical analysis of two journal articles - Kolabi et al (2011) and Ionita (2012) The study of Kolabi et al. (2011) can be characterized as quite important in terms of the issue set under examination. More specifically, in the above study emphasis is given on the potential use of traditional marketing mix in the context of entrepreneurial marketing. The role of marketing mix in entrepreneurial marketing has not emphasized in existing literature; in fact, no study of similar subject has been identified in the literature review developed for this study. It is for this reason that the particular article has been chosen for this study. The research method on which the study of Kolabi et al. (2011) has been based is rather common; a qualitative method of research has been preferred, based on interviews and open question to participants; ‘entrepreneurs and marketers of 17 firms operating in the Iranian food industry’ (Kolabi et al. 2011, p.1) have been asked to participate in the particular study. These firms are based on entrepreneurial marketing, a fact that increases the credibility of the above study. The findings of the research are analyzed using Content analysis, a widely used method of data analysis. Through the study of Kolabi et al. (2011) a critical fact is revealed: the marketing mix, in its traditional form, can be used in entrepreneurial marketing with the following exception: in entrepreneurial marketing, the marketing mix is expanded incorporating the element of Person, in addition to existing the existing elements of marketing mix, i.e. Product, Price, Place and Promotion (Kolabi et al.2011, p.15-16). The potential form of marketing mix in entrepreneurial marketing, as developed by Kolabi et al. (2011) is presented in Figure 3 (Appendices). Another important finding of the study of Kolabi et al. (2011) is the following one: entrepreneurial marketing is preferred by organizations of small to medium size, a trend that is also highlighted in the literature presented in the previous sections. In terms of its structure and content the study of Kolabi et al. (2011) can be considered as responding to the needs of the issue under discussion. More specifically, the authors have employed extensive literature, presenting in sub-sections, so that the theoretical aspects of entrepreneurial marketing are fully covered. In addition, the research included in the study is divided into Six Stages, so that readers can follow the development of the research and understand all its aspects (Kolabi et al. 2011). The study seems to have only one weakness: the gaps identified in regard to the literature reviewed by Kolabi et al. (2011) are not highlighted, so that recommendations to be made for further research. The study of Ionita (2012) is also important in terms of its key subject: the particular study focuses on the elements of entrepreneurial marketing, as related to traditional marketing and management. In fact, Ionita (2012) explains the differences between the above three concepts, so that their potential integration is evaluated. The study of Ionita (2012) has been chosen aiming to explain the equal potentials of traditional marketing and of entrepreneurial marketing to intervene in critical management decisions; such issue has not been widely discussed in the literature. Ionita (2012) employs a research approach similar to that of Kolabi et al. (2011). A qualitative research approach has been used in the study of Ionita (2012) for addressing the issues discussed. However, Ionita (2012) does not proceed to interviews but focuses on the review of existing literature, including empirical studies developed in regard to entrepreneurial marketing. The literature reviewed by Ionita (2012) is really extensive and all aspects of entrepreneurial marketing, as an aspect of traditional marketing, are highlighted. The study of Ionita (2012) helps towards the understanding of all aspects of entrepreneurial marketing, especially the relationship of this form of marketing with traditional marketing and management. In this way, it can be evaluated whether the use of entrepreneurial marketing plans is feasible in firms of different characteristics or not. Also, the potential implications of entrepreneurial marketing are made clearer. Ionita (2012) has use a different structure for his study, compared to the similar study of Kolabi et al. (2011). Such decision is fully justified at the level that Ionita (2012) has used a different research methodology, at least partially, from that of Kolabi et al. (2011). In this context, the study of Ionita (2012) has been divided into sub-sections according to the aspects of entrepreneurial marketing discussed. Themes seem to be discussed in an hierarchy, beginning from definitions and proceeding gradually to more specific issues, such as the difference between entrepreneurial marketing and traditional marketing (see also Figure 4, Appendices) and the concepts of entrepreneurial marketing. In any case, Ionita (2012) presents analytically the historical development of entrepreneurial marketing, suggesting, in the conclusion section, the most appropriate definition for the particular type of marketing. The study of Ionita can be characterized as quite successful, highlighting fully all aspects of entrepreneurial marketing, in terms if the concept’s theoretical implications. The practical implications of the above framework could be possibly checked using as a basis the study of Ionita (2012). 4. Conclusions The review of the various aspects of entrepreneurial marketing has led to the following assumption: entrepreneurial marketing even if has a long presence in the market is not widely used. Its close relationship to innovation and entrepreneurship seems to be a key factor for this outcome. Indeed, modern firms cannot guarantee the promotion of innovation in regard to their activities, at least not on a continuous basis. Therefore, entrepreneurial marketing sets targets that most firms cannot achieve. The problem seems to be more intensive in the case of large firms. The two studies that were critically reviewed in this study has led to the following assumptions: a) entrepreneurial marketing has a long history, a fact that shows its value for businesses in all markets (Ionita 2012) and b) entrepreneurial marketing can be appropriately customized, according to the developments in traditional marketing, so that it can be applied in firms of all sizes; reference should be made, in particular to the study of Kolabi et al. (2011) where the use of marketing mix, in its expanded form, in entrepreneurial marketing is discussed. The alteration of certain parts of entrepreneurial marketing would be required so that the specific mode of marketing is approachable to firms with different characteristics within the international market. 5. Recommendations Entrepreneurial marketing, in its current form, seems to be more appropriate for firms with a limited level of operations, preferably small and medium – size firms; at least, such assumption has been developed by the research developed in current study. However, keeping entrepreneurial marketing within specific borders could lead to the gradual decrease of its value. On the other hand, entrepreneurial marketing has a unique potential to promote innovation, a core element of the particular type of marketing. In modern market innovation is critical for securing organizational growth. The need for expanding the borders of entrepreneurial marketing is clear. Research should be developed in regard to this issue in order to identify the terms under which entrepreneurial marketing could be adopted by large firms. The first step in expanding entrepreneurial marketing across firms of all sizes would be the identification of the feasibility of such plan. Then, the implications of the particular initiative could be evaluated. 6. References Acs, Z. and Audretsch, D., 2010. Handbook on Entrepreneurship Research. New York: Springer. Bettiol, M., Di Maria, E. and Finotto, V., 2012. “Marketing in smes: the role of entrepreneurial sensemaking.” MPRA Paper No. 39405, Jun 2012, pp.1-32. Available at http://mpra.ub.uni-muenchen.de/39405/ Casson, M., Yeung, B. and Basu, A., 2008. The Oxford Handbook Of Enterpreneurship. Oxford Handbooks Online. Dana, L., 2007. Handbook of Research on Ethnic Minority Entrepreneurship: A Co-evolutionary View on Resource Management. Cheltenham: Edward Elgar Publishing. Donnelly, R., 2009. Delivering Customer Value Through Marketing. London: Routledge. Ionita, D., 2012. “Entrepreneurial Marketing: A new approach for challenging times.” Management & Marketing Challenges for the Knowledge Society, Vol. 7, No. 1, pp. 131-150. Available at http://www.managementmarketing.ro/pdf/articole/259.pdf Kolabi, A., Hosseini, H., Mehrabi, R. and Salamzadeh, A., 2011. “Developing Entrepreneurial Marketing Mix: Case Study of Entrepreneurial Food Enterprises in Iran.” Journal of Knowledge Management, Economics and Information Technology, Issue 5, August 2011, pp.1-17. Available at http://www.scientificpapers.org/wp-content/files/1162_Aidin_Salamzadeh_Developing_Entrepreneurial_Marketing_Mix_Case_study_of_entrepreneurial_food_enterprises_in_Iran.pdf Leadley, P. and Forsyth, P., 2004. Marketing: essential principles, new realities. London: Kogan Page Publishers. Longman, M., 2011. Entrepreneurial Marketing: A Guide for Startups & Companies With Growth Ambitions. London: Garant Publishers. Mayasari, I., Wiadi, I. and Maharani, A., 2009. “Entrepreneurial Marketing for Small and Medium Entreprises businesss. An Exploratory Study on Entrepreneurial Performance.” Integritas – Jurnal Manajemen Bisnis, Vol. 2, No. 1, pp.1-12. Available at http://www.irjbs.com/index.php/jurnalirjbs/article/download/46/pdf Morris, M., Kuratko, D. and Covin, J., 2010. Corporate Entrepreneurship and Innovation. Belmont: Cengage Learning. Panda, T., 2009. Marketing Management with CD. New Delhi: Excel Books India. Picot, A., Reichwald, R. and Wigand, R., 2008. Information, organization and management. New York: Springer. Pride, W. and Ferrell, O., 2011. Pride & Ferrell Marketing. 16th ed. Belmont: Cengage Learning. Qureshi, S. and Mian, S., 2010. “Antecedents and Outcomes of Entrepreneurial Firms Marketing Capabilities: An Empirical investigation of Small Technology Based Firms.” Journal of Strategic Innovation and Sustainability, Vol. 6, No 4, pp.28-45. Available at http://www.na-businesspress.com/JSIS/MianWeb.pdf Saxena, R., 2005. Marketing Management. New Delhi: Tata McGraw-Hill Education. Sharman, S., 2011. E-Adoption and Socio-Economic Impacts: Emerging Infrastructural Effects. London: Idea Group Inc (IGI). Stokes, D., Wilson, N. and Mador, M., 2010. Entrepreneurship. Belmont: Cengage Learning. Stokes, D., 2000. “Putting Entrepreneurship into Marketing: The Process of Entrepreneurial Marketing.” Journal of Research in Marketing & Entrepreneurship, Vol.2, No.1 Swenson, M., Rhoads, G. and Whitlark, D., 2012. “Entrepreneurial Marketing: A Framework for Creating Opportunity with Competitive Angles.” Journal of Applied Business and Economics vol. 13(1) 2012, pp.47-52. Available at http://www.na-businesspress.com/JABE/SwensonMJ_Web13_1_.pdf Welsh, H., 2004. Entrepreneurship: the way ahead. London: Routledge. Wolff, J., 2009. Marketing for entrepreneurs. Essex: Pearson Education 7. Appendices Figure 1 – Formation of marketing strategies in SMEs (Bettiol, Di Maria and Finotto 2012, p.22) Figure 2 – Entrepreneurial Marketing Framework (Swenson, Rhoads and Whitlark 2012, p.48) Figure 3 – Entrepreneurial marketing mix (Kolabi et al. 2011, p.16) Figure 4 – Entrepreneurial marketing v traditional marketing (source: Ionita 2012, p.138, as adapted by Stokes, 2000, p.13) Suggested journal for publication of this study: American Marketing Association Read More
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