Business cycle research in marketing: a review and research agenda

Marnik G Dekimpe,Barbara Deleersnyder

doi:10.1007/s11747-017-0542-9

Marnik G Dekimpe, Barbara Deleersnyder

Open Access

https://doi.org/10.1007/s11747-017-0542-9

Copy DOI

Abstract

Business cycles (BCs) may affect entire markets, and significantly alter many firms’ marketing activities and performance. Even though managers cannot prevent BCs from occurring, marketing research over the last 15 years has provided growing evidence that their impact on consumers, and hence on firm and brand performance, depends to a large extent on how firms adjust their marketing mix in response to these macro-economic swings. In this study, we review the growing marketing literature on how to attenuate or amplify the impact of BC fluctuations. Our discussion focuses on three key aspects: (1) the scope of, and insights from, existing BC research in marketing, (2) advancements in the methods to study various BC phenomena in marketing, and (3) some emerging trends that offer new challenges and opportunities for future BC research in marketing.

Highlights

Marketing research has long overlooked the impact of business cycle (BC) fluctuations
For the U.S, the National Bureau of Economic Research’s (NBER) Business Cycle Dating committee considers a broad array of economic indicators, and decides on the location of peaks and troughs in economic activity, defining a recession as the period between a peak and a trough, and an expansion as the period between a trough and the peak
These conclusions are based on a marginal profit analysis. These findings are found to differ depending on the outcome metric that is used. These findings show that, compared to goods firms, service firms may be affected differently by BC fluctuations, and deserve separate research attention, especially since the service industry contributes significantly to most countries’ Gross Domestic Product (GDP)

Summary

Introduction

Marketing research has long overlooked the impact of business cycle (BC) fluctuations. For the U.S, the National Bureau of Economic Research’s (NBER) Business Cycle Dating committee considers a broad array of economic indicators, and decides on the location of peaks and troughs in economic activity, defining a recession as the period between a peak and a trough, and an expansion as the period between a trough and the peak. This identification of peaks and troughs is judgmental, and open to debate. This definition has been applied in marketing studies by, among others, Kamakura and Du (2012) and Sethuraman et al (2011)

Objectives

Methods

Findings

Conclusion