The contribution of marketing to business strategy formation: a perspective on business performance gains

Abstract

Recognized as a topic with important implications for executive practice by both the Marketing Science Institute and the American Marketing Association, the contribution of marketing to business strategy formation has now become a fertile, prominent and notable area of contemporary investigation. It remains that little is understood of (1) the relevant contribution and centrality of marketing to business strategy formation, (2) the empirical testing of this contribution in areas of particular strategic relevance and (3) the business performance implications of marketing's contribution to business strategy formation. In an attempt to address these three key issues, this paper presents an empirical investigation of medium and large, high-technology, industrial manufacturing firms. Specifically, the study examines the potential differences between high business performance firms and low business performance firms concerning the contribution of marketing to dimensions of business strategy formation activities while controlling for potential confounding effects. The findings indicate that firms are able to realize significantly greater pay-offs in business performance terms when critical marketing input in all areas of the strategy formation process (from goal setting to strategy selection) is harnessed in comparison with those firms where marketing does not make such a meaningful contribution to strategy formation.