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Marketing strategy and marketing performance measurement system: Exploring the relationship Lucio Lamberti * , Giuliano Noci Politecnico di Milano – Department of Management, Economics and Industrial Engineering, Piazza L. Da Vinci 32, 20133 Milano, Italy KEYWORDS Marketing performance measurement; Marketing strategy; Performance measure- ment system design; Qualitative study Summary Though marketing performance measurement has long been a concern for lit- erature and companies, the relationship between marketing strategy and marketing per- formance measurement system (MPMS) design is a substantially uncovered topic. This paper endorses Coviello et al. [Coviello, N. E., Brodie, R. J. and Munro, H. J. (1997) Under- standing contemporary marketing: Development of a classification scheme. Journal of Marketing Management, 13, 501–522.] classification scheme for marketing strategies and draws from literature a conceptual framework about the managerial levers for MPMS design (marketing performances, measures and control system), aiming to explore the possible existence and the nature of the marketing strategy–MPMS relationship. The study is carried out with a multiple case study approach in seven Italian organizations. The out- comes show that companies pursuing different marketing strategies adopt different MPMS, and the authors explore the impact of some contextual elements possibly impact- ing on the relationship, discussing their role in the glance of existing literature. The results have suggested some managerial implications. ª 2009 Elsevier Ltd. All rights reserved. Introduction Marketing performance measurement has long been a main concern in marketing literature and a core, troubled issue in companies. Nonetheless, since the seminal works on marketing productivity analysis, the academician and managerial domains have seldom generated essential new knowledge on the topic (e.g. OÕSullivan and Abela, 2007). Though a strong effort has been devoted to the develop- ment of punctual measures better suited to assess the evolving relevant performances in response to the emerging marketing paradigms, marketing performance measurement system (MPMS) design still remains a widely uncovered topic (Clark, 1999). In particular, and quite surprisingly, substan- tially no studies have analyzed whether and how MPMS de- sign should be adapted to the specificities of companyÕs (marketing) strategy, so that the current knowledge about the marketing strategy–MPMS relationship is extremely 0263-2373/$ - see front matter ª 2009 Elsevier Ltd. All rights reserved. doi:10.1016/j.emj.2009.04.007 * Corresponding author. Tel.: +39 02 2399 4076; fax: +39 02 2399 4083. E-mail addresses: [email protected] (L. Lamberti), [email protected] (G. Noci). European Management Journal (2010) 28, 139152 journal homepage: www.elsevier.com/locate/emj

Marketing strategy and marketing performance measurement system: Exploring the relationship

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European Management Journal (2010) 28, 139–152

journal homepage: www.elsevier .com/ locate /emj

Marketing strategy and marketing performancemeasurement system: Exploring the relationship

Lucio Lamberti *, Giuliano Noci

Politecnico di Milano – Department of Management, Economics and Industrial Engineering, Piazza L. Da Vinci 32,20133 Milano, Italy

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*

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KEYWORDSMarketing performancemeasurement;Marketing strategy;Performance measure-ment system design;Qualitative study

63-2373/$ - see front mattei:10.1016/j.emj.2009.04.00

Corresponding author. Tel83.E-mail addresses: lucio

[email protected] (G. No

r ª 2007

.: +39 02

.lambertci).

Summary Though marketing performance measurement has long been a concern for lit-erature and companies, the relationship between marketing strategy and marketing per-formance measurement system (MPMS) design is a substantially uncovered topic. Thispaper endorses Coviello et al. [Coviello, N. E., Brodie, R. J. and Munro, H. J. (1997) Under-standing contemporary marketing: Development of a classification scheme. Journal ofMarketing Management, 13, 501–522.] classification scheme for marketing strategiesand draws from literature a conceptual framework about the managerial levers for MPMSdesign (marketing performances, measures and control system), aiming to explore thepossible existence and the nature of the marketing strategy–MPMS relationship. The studyis carried out with a multiple case study approach in seven Italian organizations. The out-comes show that companies pursuing different marketing strategies adopt differentMPMS, and the authors explore the impact of some contextual elements possibly impact-ing on the relationship, discussing their role in the glance of existing literature. Theresults have suggested some managerial implications.ª 2009 Elsevier Ltd. All rights reserved.

Introduction

Marketing performance measurement has long been a mainconcern in marketing literature and a core, troubled issue incompanies. Nonetheless, since the seminal works onmarketing productivity analysis, the academician andmanagerial domains have seldom generated essential new

9 Elsevier Ltd. All rights reserved.

2399 4076; fax: +39 02 2399

[email protected] (L. Lamberti),

knowledge on the topic (e.g. O�Sullivan and Abela, 2007).Though a strong effort has been devoted to the develop-ment of punctual measures better suited to assess theevolving relevant performances in response to the emergingmarketing paradigms, marketing performance measurementsystem (MPMS) design still remains a widely uncovered topic(Clark, 1999). In particular, and quite surprisingly, substan-tially no studies have analyzed whether and how MPMS de-sign should be adapted to the specificities of company�s(marketing) strategy, so that the current knowledge aboutthe marketing strategy–MPMS relationship is extremely

140 L. Lamberti, G. Noci

scarce. In this paper, we aim at contributing to the con-struction of a theory on the topic by exploring the possiblerelationship between marketing strategy and some of themain MPMS design variables (performances assessed, mea-sures adopted and control system implemented). In this re-spect, we introduce the results of seven in-depth casestudies from companies adopting different marketingstrategies. In the following, we will briefly summarize thestate-of-the-art literature on marketing performancemeasurement in order to introduce the research framework.Then, we will illustrate the empirical exercise by presentingthe methodology adopted. Next, after having briefly intro-duced the companies involved in the study and summarizedthe findings, we will discuss the outcomes in the light of thestate-of-the-art literature. Finally, we will draw managerialimplications of the study and the conclusions.

Literature review

The first theories about MPMS considered marketing activ-ities mainly as a discretional cost centre and, as such, ac-counted for its incidence on corporate costs (e.g. Sevin,1965). This approach, born and developed in a era of prod-uct centricity, has shown its weaknesses with the affirma-tion of more and more customer- and relationship-orientedmarketing strategies (Sheth et al., 2002): such paradigmsmodified the role of the customer in the firm, from passivetarget of the marketing action to proactive partner in-volved in value generation, and, as such, as an asset thecompany must manage in time and continuously assess(e.g. Gummesson, 2004). This explains the growing atten-tion paid to marketing intangibles and customer account-ability, for instance through the theories on brand equityand customer equity (e.g. Rust et al., 2004). The underly-ing assumption of these streams is the need to enlarge therelevant marketing performances for the company, in re-sponse to the evolving marketing goals of the emergingparadigms, from pure internal efficiency and turnover gen-eration to cost-effectiveness and customer profitability(Shah et al., 2006; Sheth et al., 2002). This element sug-gests that MPMS design should depend (also) on marketingstrategy, and that a suited marketing accountability is akey-issue in pursuing the marketing strategic objectives.Nonetheless, the existing wisdom about marketingaccountability is widely considered insufficient by litera-ture: in a recent paper published on EMJ, for instance,Bonnemaizon et al. (2007) indicate the poor attention paidto the definition of a consistent marketing accountabilityas one of the causes of the lack of a dominant relationshipmarketing practice; Morgan and colleagues notice that‘‘both academics and managers currently lack a compre-hensive understanding of the marketing performance pro-cess and the factors that affect the design and use ofmarketing performance assessment systems within corpo-rations’’ (Morgan et al., 2002, p. 363). It is not surprising,thus, that MSI has ranked marketing accountability, ROI,and MPMS among the top 10 marketing research prioritiessince 2002, and as the top-priority for 2008–2010 (MSI,2008). Also in response to these calls, marketing literaturehas tried to analyze MPMS; in detail, three main literaturestreams on MPM have emerged:

i. the definition of the domain of marketing perfor-mances, i.e. the plethora of business performancesmarketing is accountable for (e.g. Bellis-Jones,1989; Bhargava et al., 1994; Bolton, 2004; Blattbergand Deighton, 1996);

ii. the definition of the metrics suitable to assess suchperformances and their adoption in practice (e.g. Bar-wise and Farley, 2003, 2004; Shah et al., 2006; Rustet al., 2004; Berger and Nasr, 1998; Winer, 2000);

iii. the definition of the design variables and of the con-tingent and environmental variables possibly influenc-ing MPMS (e.g. Jaworski, 1988; Jaworski et al., 1993;Clark, 1999; Morgan et al., 2002).

The first two points, though not exhaustively debated,have been explored much more deeply than the third one.Indeed, since Jaworski�s MPM system conceptual frameworkdefinition (Jaworski, 1988), research on the MPMS design hasgenerated some inferences about the role of the distribu-tion channel configuration on marketing performance mea-surement and management (Loning and Besson, 2002) andsome pre-eminently theoretical works aimed at definingconceptual frameworks for detecting the design variablesfor MPMS (Jaworski et al., 1993; Clark, 1999; Morganet al., 2002; Gummesson, 2004). Nonetheless, many issuesare still to be addressed, and evidence-based works arestrongly requested by academy and business community.In particular, quite surprisingly, the relationship betweenmarketing strategy and MPMS design is a mainly uncoveredissue in marketing literature, and this work aims at provid-ing first evidences on the topic.

Conceptual framework

The literature review aimed at formalizing a researchframework that, grounded in the extant knowledge, couldsupport an empirical investigation on the relationship be-tween marketing strategy and MPM system. In order to carryout the analysis, it was necessary to define two componentsin the reference framework: firstly, the authors looked fortaxonomies defining the basic marketing strategies compa-nies may adopt; secondly, they detected a framework fordescribing the key elements of a MPM system.

Basic marketing strategies

The crisis of the mass market paradigm has generated afragmentation in marketing practice by companies (Brodieand Coviello, 2008). The increasing attention paid to cus-tomer retention and to the relationships between the firmand its stakeholders led to the affirmation of more relation-ship-oriented marketing paradigms (e.g. Gronroos, 1990)and, more recently, of more radical approaches, such as:service dominant logic (SDL), (Vargo and Lusch, 2004), cus-tomer-centric marketing (Sheth et al., 2002, pp. 56–57) andBalanced Centricity (Gummesson, 2008). Nonetheless, astudy by Coviello and Brodie (1998) has shown that manycompanies succeed mashing up elements of relationshipand transactional marketing. This result called into questionthe dichotomy between transaction-oriented and relation-

Marketing strategy and marketing performance measurement system: Exploring the relationship 141

ship-oriented marketing strategies (e.g. Gronroos, 1994;Webster, 1992).

In order to systematize the diversity in marketing strate-gies and practices adopted by companies, a decennial inter-national research program, called contemporary marketingpractices (CMP), was undertaken by Auckland University.Such program led to a widely accepted classification schemefor marketing strategies, which represents one of the con-ceptual fundaments of the present study. Coviello et al.(1997) postulated the existence of two archetypal extremeson the continuum of marketing practices, namely:

• Transactional marketing (TM), a marketing practice char-acterized by the use of the Marketing Mix to attract andsatisfy the market.

• Relational marketing (RM), defined as the marketing prac-tice aimed to establish, maintain, and enhance relation-ships with customers and other partners in order to meetthe objectives of thepartners involved (Gummesson, 1990).

RM practices can be further subdivided into databasemarketing (DM, characterized by the use of ICTs in order totarget and retain customers), interaction marketing (IM,characterized by the establishment of relationships aimedat creating cooperative interactions) and network marketing(NM, characterized by a many-to-many approach with con-nected relationships between firms), though the first andthe third approaches have demonstrated to be far lessadopted by contemporary companies (Coviello et al.,1997). A third archetypal marketing strategy derives fromthe observation of a significant group of companies contem-porarily adopting TM and RM. This led to the postulation ofthe hybrid transactional/relational approach (transac-tional/relational marketing – TRM) (Coviello et al., 2002;Brodie and Coviello, 2008). As a result, in this work we di-vided the companies into three strategic clusters:

• Transactional marketing companies (TMCs), character-ized by marketing activities mainly aimed at attractingcustomers, standardizing customer interactions morethan at establishing long-term relationships and custom-izing customer retention practices.

• Relational marketing companies (RMCs), characterized bya relationship-oriented approach to customer interac-tions, with a strong orientation towards the establishmentof long-term relationships with the customers and the sup-ply-chain, with a strong attitude towards cooperation.

• Transactional/relational marketing companies (TRCs)companies, characterized by a coexistence of relation-ship-oriented and transaction-oriented approaches tocustomer and supply-chain interactions; the coexistenceis mainly determined by customer and supply-chaindiversity, that leads these companies to act differentlyaccording to the specificities of their target market.

Marketing performance measurement systemcharacteristics

A performance measurement system (PMS) can be definedas the system managers use in order to (i) check whether

the intended strategy is being implemented; (ii) communi-cate to their employees what are the goals they are ex-pected to achieve and whether they are achieving thoseexpected goals; (iii) validate whether the intended strategyis still valid; and (iv) facilitate individual and organizationallearning and improvement. MPMS is the part of corporatePMS aiming at assessing the performance influenced by mar-keting (Morgan et al., 2002). The literature review high-lighted three main variables characterizing a MPM system:

(1) Typology of performances assessed (which are thecorporate performances under the responsibility ofthe marketing units?).

(2) Typology of measures adopted (which kinds of mea-sures are adopted?).

(3) Control system (how do managers assess perfor-mances and manage the information coming fromthe MPM system?).

In the following, the three issues will be detailed.

Typologies of performance assessed

Marketing literature suggests several different typologies ofmarketing performances (Table 1). Since traditionally, mar-keting department activities have mainly been considered adiscretionary cost (Lau, 1999), the main performancesattributable to marketing are the marketing efficiency per-formances, related to intra-functional processes, such asthe results in terms of costs and turnover immediatelycaused by promotional, selling, pricing and distributionalactivities (Morgan et al., 2002).

The diffusion of marketing paradigms stressing the needto engage customers into the company�s marketing processes(e.g. co-creation) and to track the relationship between thefirm and its customers led to the affirmation of an enlarge-ment in the scope of marketing activities, with a gradualenclosure of customer integration performances, i.e. theability to acquire and retain profitable customers (Srivastavaet al., 1998), measured through customer lifetime value,customer loyalty, customer satisfaction and the other met-rics suggested by relationship marketing authors (Rustet al., 2004; Peppers and Rogers, 2000; Hogan et al., 2002).

Another significant stream of literature has analyzed therelationship between marketing and supply-chain manage-ment (Gentile et al., 2006; Webster, 1992; Lambert andCooper, 2000), affirming that marketing can also be respon-sible for Supply-chain integration performances, i.e. thecapability to efficiently and effectively interface with sup-pliers and marketing channel: co-design in NPD (‘‘creatingvalue’’), strategic alignment in supply-chain competition(‘‘communicating value’’) and in retail management(‘‘delivering value’’) are just examples of the increasingrole of supply-chain management in marketing activities.This kind of marketing performances and the related met-rics (e.g. lead time, service level, percentage of turnovergenerated by products co-created with supply-chain part-ners etc.) have been analyzed both in marketing literature(e.g. Srivastava et al., 1999; Webster, 1992) and in sup-ply-chain literature (e.g. Duclos et al., 2003). The needfor interfunctional coordination affirmed by the market-

Table 1 Dimensions of marketing performances detected by literature.

Performance Definition Main references

Marketing efficiency Ability to efficiently transform marketinginputs into marketing outputs

Kotler (2002), Clark (1999), Ambler (2003),O�Sullivan and Abela (2007), Morgan et al. (2002);Bonoma and Clark (1988), Sevin (1965), Clark(2000)

Customer relationshipmanagement

Ability to attract and retain profitablecustomers

Kotler (2002), Peppers and Rogers (1993),Peppers and Rogers (2000), Kumar et al. (2004),Rust et al. (2004), Rust et al. (2004), O�Sullivanand Abela (2007), Kim et al. (2003), Bellis-Jones(1989), Berger and Nasr (1998), Blattberg andDeighton (1996), Blattberg et al. (2001),Hansotia (2004)

Internal consistency Ability to spread and maintain a strategicalignment with all the non-marketingfunctions within the firm

Kohli and Jaworski (1990), Narver and Slater(1990), Day (1994), Sheth et al. (2002), Shahet al. (2006), Srivastava et al. (1998, 1999)

Supply-chain interface Ability to spread and maintain a strategicalignment with all the relevant supply-chain partners (channels, suppliers,outsourcers etc.)

Gentile et al. (2006), Srivastava et al. (1998),Duclos et al. (2003), Webster (1992), Lambertand Cooper (2000)

Intellectual capital andknowledge-based assetmanagement

Ability to generate market intelligence,to spread it all over the organization andto spread a customer oriented culturewithin the firm.

Kohli and Jaworski (1990), Narver and Slater(1990), Day (1994), Shah et al. (2006), Boarettoet al. (2007), Srivastava et al. (1998), Deshpandeand Webster (1989), Andriessen (2004), Sveiby(1997, 2005)

142 L. Lamberti, G. Noci

orientation theory (Narver and Slater, 1990), but also bycustomer-centricity (Sheth et al., 2002), SDL (Vargo andLusch, 2004) and Balanced Centricity (Gummesson, 2008),has stressed on the relevance of the consistency betweenmarketing and non-marketing activities within the firm. Asa result, Internal consistency performances, i.e. the capa-bility of marketing to efficiently and effectively interfacewith non-marketing functions (e.g. behavioral controls forfavouring the cross-functional team working, responsive-ness and precision in information provision etc.) have gotmomentum in marketing literature (Kohli and Jaworski,1990; Srivastava et al., 1998).

Finally, the emergence of the cultural role of marketing(Kumar, 2004; Deshpande and Webster, 1989) led to intro-duce intellectual capital and knowledge-based assets per-formances as possible relevant performances in analyzingmarketing outcomes. Indeed, many authors attribute tothe marketing departments the responsibility to spreadthe market culture all over the organization (e.g. Shethet al., 2002; Kohli and Jaworski, 1990). In this sense, beingorganizational culture and knowledge sharing positively cor-related to corporate spirits de corps, job satisfaction andorganizational commitment of the employees (Rust et al.,2004; Deshpande and Webster, 1989), literature outlinesthe potential utility for companies to measure this kind ofperformances in order to get a comprehensive understate-ment of the evolution of marketing strategy (Andriessen,2004; Sveiby, 1997, 2005).

Typology of measures adopted

Similarly to the analysis of the typology of performances as-sessed, literature has provided a very heterogeneous set of

contributions about the typologies of marketing measuresadopted by companies. However, differently from the pre-vious issue, it was possible to detect a widely accepted uni-fying taxonomy in Clark�s theory (Clark, 1999). The authordivides marketing measures into four main categories:

- single financial output measures (e.g. profit, sales andcash flows), representing the first effort to assess mar-keting performances (e.g. Sevin, 1965) by comparingthe outcomes of marketing actions with the costs affor-ded to implement them;

- non-financial measures, i.e. the marketing output mea-sures assessed through non-financial or qualitative met-rics, such as market share, customer satisfaction,customer loyalty and brand equity;

- input measures, i.e. metrics aimed at assessing market-ing performances by analyzing their resource absorption(e.g. marketing assets, marketing budget) or the behav-ior of marketing units (e.g. marketing audits, behavioralcontrol systems);

- multiplemeasures, i.e. hybridmeasures aimed at assessingeither the macro-dimensions of efficiency, effectivenessand adaptiveness or the interdependency between the dif-ferent dimensions of MPM (e.g. multivariate analysis).

The choice of Clark�s framework is motivated by two rea-sons. First, it is a widely accepted taxonomy (e.g. O�Sullivanand Abela, 2007; Barwise and Farley, 2004). Second, Clark�stheory also depicts some of the environmental and strategicchanges explaining the attention paid by practitioners andacademicians to the different typologies of measures. Assuch, it will be interesting to match the evidences gatheredin the empirical test with Clark�s theoretical assumptions.

Table 3 Key informants in the empirical exercise.

Company name Key informants

Foodfresh SBU CEOSBU CMOSBU CFOKey account managers (2)

Foodcereal Marketing managerFinance managerStrategic planning managerProduct manager

Bank CEOAccountantPrivate customers marketing manager

Envcons CEOFinancial officer

Metalpack SBU marketing managerR&D managerSBU CFOSBU strategic planning manager

Electrap Marketing managerR&D managerHR managerCFO

Airbook CEOCFOChief marketing officer

Table 2 Research sample of the study.

Company name Country Employees Industry Typology of customer

Airbook Italy 150 Flight booking B2CBank Italy 450 Banking B2B/B2CElectrap Italy 1.200 Electric apparel B2B/B2CEnvcons Italy 95 Consultancy B2BFoodcereal Italy 3.500 Food B2CFoodfresh France 15.000 Food B2CMetalpack USA 25.000 Metal working B2B

Marketing strategy and marketing performance measurement system: Exploring the relationship 143

Control system

Defining ‘‘control’’ as the attempt, within the SBU, to influ-ence employee behavior and activities, Jaworski et al.(1993) affirm that the control system is the combinationof the level of reliance on two control types: formal con-trols (written and generally management-initiated controlsaimed at fine tuning employee behavior to the marketingobjectives) and informal controls (unwritten and generallyemployee initiated mechanisms aimed at influencing thebehaviors). The mix between formal and informal controlsrepresents the control combination or control system.According to the extent of reliance on the control types,four main control systems have been detected (Jaworskiet al., 1993):

(1) high control systems (high reliance both on formal andinformal control),

(2) low control systems (low reliance both on formal andinformal controls),

(3) bureaucratic systems (high reliance on formal controland low reliance on informal controls), and

(4) clan systems (low reliance on formal control and highreliance on informal control).

Though Jaworski et al. (1993) outlined the existence ofantecedents in the adoption of a specific control system(namely, SBU size, task routineness, learn-job time andcompleteness), none of them directly refers to marketingstrategy.

Research design

Data collection

Due to the lack of similar studies in literature, an inductiveand exploratory approach was necessary and better suitedto support theory building. As a result, case study method-ology was adopted: we conducted studies in seven Italiancompanies operating in different industries and with differ-ent characteristics. We looked for similarities and diversi-ties in MPMS design among companies adopting similar anddifferent marketing strategies. More precisely, the selec-tion of cases was intended to include companies operatingin Italy able to respond to the diversity in terms of market-ing strategies adopted, possibly getting diversity also interms of environmental and contingent variables: SMEsand large companies, product and service suppliers, indus-

trial and consumer companies, and direct marketing andtrade marketing companies. The choice was also based onthe possibility to gain access to the company and their avail-ability to show confidential information. For confidentialityreasons, the cases presented in the following will be re-ferred to with pseudonyms instead of the companies� realnames (Table 2).

The central empirical basis was derived from interviews.Since emerging theories on marketing strategy stress on thecross-functional nature of marketing processes (e.g. Srivast-ava et al., 1999; Shah et al., 2006), multiple interviewswere necessary to achieve a global overview for each com-pany. Accordingly, marketing officers, executive officersand accountants have been privileged interlocutors and,

Table 4 Main topics addressed in the interviews.

Functional area of the key informant Main topics addressed

CEO/Board/Strategic planning • History of the company, ownership structure and corporate governance• Strategic overview of the company• Roles, responsibilities and power of the marketing units• Description of the marketing strategy• Key marketing performances assessed at a strategic level

CMO/Marketing manager • Description of the marketing process• Interaction with the non-marketing functions• Interaction with the customer• Interaction with the supply-chain• Nature and structure of the MPMS adopted• Internal control and incentive system for marketing units

CFO • Corporate performance measurement system• Characteristics and criticalities of the MPMS• Integration of the MPMS in the corporate performance measurement system• Strategic relevance of the marketing performance, expectances by the board and budgeting

Other managers • Punctual discussion of problematic issues emerged during the other interviews

144 L. Lamberti, G. Noci

as a result, 25 key informants in the seven companies weredetected (Table 3). Interviews dealt with the analysis of themarketing strategy and with the structure and the charac-teristics of the MPM system. In detail, Table 4 reports theroles of the interviewees and the key-information gatheredduring the interviews.

The study adopted a cross-case explanation-building andpattern-matching approach aimed at ensuring an internalvalidity and particularly suitable to semi-exploratory re-search (Yin, 1994). All the interviews were conducted be-tween May 2007 and December 2007; the analysis wascarried out as follows:

• At the beginning, a relationship was established withthe CEO/Managing Director. He was briefed about theresearch project and the authors asked to be intro-duced to the Marketing Manager and the financialdirector;

• The managers were asked to compile the marketingstrategy questionnaire developed by Coviello et al.(2002), and the results compared with the outcomes ofthe interviews in order to assess the belonging of thecompanies to one of the three clusters taken as a refer-ence in this study (transactional marketing companies,relational marketing companies and transactional-rela-tional marketing companies). The aim of the survey wasto confirm the exact interpretation of the marketingstrategy, and in all the cases the results confirmed theresearchers� perception;

• The authors personally interviewed the selected manag-ers; they undertook a semi-structured interview (eachof them lasting on average 2 h) for each respondent inorder to gather the information required;

• All interviews were tape-recorded and transcribed; atelephone follow-up with the respondents was conductedwhether a few data were missing;

• At the end of the interviews with the CEO, CMO and CFO,if relevant aspects regarding certain issues emerged, theauthors asked to be introduced to the managers respon-sible for such issues;

• All available secondary information regarding marketingstrategies and MPM was collected and triangulated withdata drawn from the direct interviews in order toenhance research reliability;

• External sources of information were identified to gatherother points of view regarding company�s marketingstrategy. In particular, internal reports and budgets wereanalyzed to understand the role and the relevance of theinformation generated by the MPM system; moreover,presentations, bonus allocation schemes and internaldocuments were gathered in order to understand themarketing measures adopted;

• A first hand summary of the findings has been discussedwith the managers who were interviewed in order toidentify any misunderstanding.

Findings

The sample covered all the three marketing strategy clustersexcerpted by Coviello et al. (2002) framework. Airbook andFoodcereal belong to the TMCs� cluster. Airbook, an on-lineflight booking agency, is an archetypal hi-tech product-cen-tric company, in which the booking software is consideredas the competitive differential, and market intelligence isconsidered poorly significant. Foodcereal is a company oper-ating in the FMCGmarket, showing quite a clear customer ser-vice culture, but also a clear functional approach tomarketing. Their approach to market is characterized by anaggressive pull strategy on the end user and to a penetra-tion-oriented strategy towards the trade; relationships withtrade and supply-chain are generally conflictual and aimedatmaximizing unique transaction returns. Very few customerretention activities have been implemented (just recentlyAirbook has started leveraging on customer database to clus-ter the targets of price promotions), and the companies donot show particular interest in developing similar initiatives.

Envcons and Metalpack belong to the RMCs� cluster. Env-cons is quite a typical Italian SME in which the entrepreneur

Table 5 Summary of the findings of the case studies.

Key features of the marketing strategy Marketing activities assessed Measures adopted Control type

Airbook Marketing action focused on the conceptof convenience:

• Lower commissions for customers• Simple web interface• Wide choice of airlines• Absence of complementary services• No investments in CRM (besides an undif-ferentiated weekly newsletter)

• No expenses in offline promotion

• Customer attraction (mainly throughsearch engine marketing and websiteaffiliation)

• Promotion efficiency (newsletterand special offers management)

• Conversion rate• Cost-per-order (the marketingexpense per purchase)

• Net reach (number of daily singleaccesses)

• Qualitative measures to assessesindividuals� contribution to the goals(e.g. problem solving capabilities,interpersonal skills, etc.)

The board sets standard levels of theKPIs (e.g. a 20€/sale cap) andperiodically controls that thesestandards are met

Foodcereal Premium price strategy pursued throughmass communication and promotion. Noinvestment in customer retention, andtransactional approach towards supply-chain and the trade. Poor integrationbetween marketing, sourcing andoperations, with a conflictualrelationship moderated by CFO and CEO

• Promotion efficiency/effectiveness(customer attraction and entry barri-ers for competitors)

• Pricing• Returns on marketing campaigns andnew product launch

• Break-even time• ROS• Turnover• Market share• Budgetary control• Qualitative measures to assess indi-viduals� contribution to the goalsthrough qualitative measures

The board sets standard levels of theKPIs (e.g. 8–24 months break-evenaccording to the new productcharacteristics, ROS P 2.5% etc.) andperiodically controls that thesestandards are met

Envcons Two differentials are pursued:technological innovativeness and strongrelationship with the stakeholders.Marketing activities should communicatethe former and sustain the latter

• Communication (updating customersabout normative evolution and tech-nological content of the solutionsoffered)

• Stakeholder relationship manage-ment (public relations, CSR, etc.)

• Customer relationship management(periodical auditing aimed at catch-ing emerging needs)

• Intelligence dissemination towardsnon-marketing functions and sup-ply-chain partners (e.g. communica-tion of customer inputs totechnology suppliers)

• Turnover• Customer profitability• Customer satisfaction (throughauditing)

• Quali-qualitative measures forassessing internal intelligence dis-semination (mainly through opera-tional auditing)

• Qualitative measures of stakeholdersatisfaction

The CEO and the CFO set amarketing/commercial budget and aseries of norms for favoringknowledge sharing and periodicallyreview marketing performancesinteractively

Bank Small bank focused on small investorsand at supporting the growth of SMEs.Strong relationship with the territory

• Communication (customer attrac-tion, especially as far as depositsconcerns)

• Customer relationship management(mainly about deposit holders)

• Customer profitability• Customer retention

• Retention rate• Churn rate• Customer lifetime value (CLV)• Quali-quantitative measures toassess individual performances (e.g.account managers� churn rate)

The board sets the classes ofcustomers according to theirdeposits/exposure; then, individualunits (account managers) havedegrees of freedom based on thehistorical relationship with thecustomer

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Table 5 (continued)

Key features of the marketing strategy Marketing activities assessed Measures adopted Control type

Metalpack Marketing focus is to maintain long- termrelationship with the existing customersby providing not only the product, butalso a value-adding consultancy aboutpackaging design

• Customer relationship (contributionto innovation processes and periodi-cal auditing to catch emergingneeds)

• Intelligence dissemination (transla-tion of customer inputs into opera-tions, supply-chain and R&D inputs)

• Pricing

• Customer profitability and turnover• Customer satisfaction• Qualitative measures and opera-tional auditing for assessing intelli-gence dissemination among non-marketing functions and towardsthe supply-chain

The board sets a basic marketingbudget and discusses with accountmanagers and marketing unit ad hocfinancing for specific consultancyactivities. Intelligence disseminationis based on norms and mutualadaptation

Foodfresh The company joins the traditionalattraction and transaction objectives of aFMCG firm with a strong effort oncustomer relationships related to thewellbeing/healthy segment, especiallythrough web-based tools

• Communication (customer attractionand reinforcement of brand identityand reputation in the healthysegment)

• Promotion (customer attraction andtrade relationship management)

• Community management (brandidentity reinforcement and customerloyalty)

• New product development (ability totranslate community and marketinputs into R&D and supply-chaininputs and to coordinate the innova-tion teams with R&D, Sourcing andOperations units)

• Break-even time• Margin• Market share• Budgetary control• Campaign effectiveness (net reachof the web site)

• Qualitative measures to assessesmarketing units� (i) ability to coordi-nate cross-functional and cross-orga-nizational processes, (ii) ability tocontribute through community intel-ligence, to NPD

The board sets standard levels forquantitative KPIs (e.g. double-digitmargin break-even time 6 18 monthsfor incremental innovation), normsfor managing cross-functionalconflicts and favoring team working.Periodical meetings for discussing theresults and redefining the objectives

Electrap Marketing focus is threefold:• Coordinating innovation projects(together with R&D) in order to sustaina market-driven innovation for catalogproducts and customized solution forindustrial accounts

• Managing relationships with wholesalersand large installer

• Translating market inputs into R&D andsupply-chain inputs

• Innovativeness and rate of success(cross-functional teams with R&D)

• Communication (all along the chan-nel, in both a push and pullperspective)

• Trade management (promotioneffectiveness and trade retention)

• Customer relationship management(wholesalers)

• Coordination with suppliers (espe-cially external designers in thehigh-end products)

• Return on promotion and marketingcampaigns

• ROS• Budgetary control (6% of the turn-over + biennial Zero-basedbudgeting)

• Innovation rate of success• Wholesalers� CLV• Installer retention rate• Qualitative measures to assessmarketing units� ability to optimizemarketing processes (e.g. costreduction) and to knowledge sharing

The board sets standard levels forquantitative KPIs (e.g. double-digitROS in the first two years, breakeventime 6 18 months), norms forknowledge sharing are defined, andperiodical meetings are organized toshare advances and future challengesamong functions

146L.

Lamberti,

G.Noci

Table 6 Main characteristics of the MPMS in the three strategic clusters.

Marketingstrategy

Companies Marketing performances assessed Measures adopted Control system

TMCs • Airbook• Foodcereal

• Marketing efficiency (return on promotioninvestment, budgetary control)

• Economic inputs (incremental budgets)• Aggregate financial outputs (e.g. turnover,cost-per-contact etc.)

• Aggregate non-financial outputs (marketshare)

• Compliance to quantitative standards

RMCs • Envcons• Metalpack

• Marketing efficiency (relatively lowimportance)

• Customer integration (ability to retain• Customers, to understand their needs, etc.)• Internal Consistency (ability to coordinateother functions in customer solutionsdevelopment)

• Supply-chain integration (ability to involvesuppliers in NPD)

• Intellectual capital and knowledge-basedasset management (ability to spread marketintelligence and direct knowledge about thecustomers)

• Economic inputs (budgetary control);• Non-financial output controls (customerretention, churn rate, customer satisfaction,etc.)

• Non-financial process controls (work proce-dures, behavioral codes, qualitative evalua-tion of pro-activity, etc.);

• High reliance on the compliance to behav-ioral codes of conduct

• High reliance on informal social control andreciprocal coordination

• Low reliance on the compliance to quantita-tive financial standards (e.g. budgets)

TRMCs • Bank• Electrap• Foodfresh

• Marketing efficiency (budgetary control)• Customer Integration (especially ability toretain customers)

• Internal consistency (ability to work in teamwith other functions in innovation processes)

• Elements of supply-chain integration (ininnovation)

• Intellectual capital and knowledge-basedasset management (contribution to the affir-mation of a customer-oriented culture espe-cially within the marketing units)

• Economic inputs (budgetary control);• Multiple disaggregate economic outputs(customer profitability analysis, cost-per-contact, etc.)

• Disaggregate non-economic outputs (cus-tomer satisfaction, churn rate, retentionrate etc.)

• Qualitative behavioral and social controls(especially for internal consistency and sup-ply-chain integration performances)

• High reliance on the short term financial per-formances for customer attraction andretention

• High reliance on informal controls (recipro-cal coordination) in interfunctional teams

• High reliance on formal qualitative controls(procedures, codes of conduct, proceduresfor knowledge sharing, etc.)

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148 L. Lamberti, G. Noci

is the pre-eminent strategic decider; the main Envcons� cus-tomers are Local Public Bodies, and the service sold (tech-nological and sometimes infrastructural support for wastemanagement) is structurally long-term oriented, since it re-gards multiannual consulting in waste reduction and treat-ment and in recycling policies. Metalpack producesmetallic packaging for cosmetic products such as deodor-ants, perfumes, tricks and skin-care creams. Metalpack�scustomer portfolio has changed only for the 3% over the last10 years, and the average lifetime of current customers ishigher than 15 years. Moreover, Metalpack must, by defini-tion, involve customers in NPD for design and aesthetic rea-sons. Even more interesting, Metalpack also providescustomers with a key account interfunctional team whichcan support customer�s NPD thanks to their specific compe-tencies in packaging. Finally, Foodfresh, Bank and Electrapbelong to the TM/RM companies� cluster. In fact, they alldemonstrate quite a sound customer service culture, butthey also show different approaches for different custom-ers. Foodfresh is a company operating in the FMCG, produc-ing frozen and processed food; while the relationship withthe retailers is characterized by a strong transactional strat-egy, end user management is strongly relational in nature:Foodfresh strongly stresses on the emotional and custom-ized content of the relationship with the customer, througha strong use of user-generated content in advertising, and astructured marketing database used for managing custom-ized campaigns. Bank is, of course, a small bank operatingin Northern Italy; strongly rooted in the regional economy,it pursues a hybrid marketing strategy, as it has a veryaggressive customer attraction policy for the mass market,but also a highly customized and relationship-oriented strat-egy for the big spenders and for the local entrepreneurs.

The evidences gathered in the study are summarized inTable 5,1 which addresses the main issues of marketingstrategy and MPMS in the seven companies analyzed. Thispiece of information represents the basis for the followingdiscussion.

Discussion

The discussion of the evidence will be articulated into twomain parts: the first will show the main traits of the MPMSadopted in the three clusters of companies investigated,while the second will discuss the impact of contextual ele-ments on MPMS design (see Table 6).

Main traits of the MPMS adopted in the threeclusters

Transactional marketing companiesThe TMCs show some strong commonalities in their MPMS.First of all, in both the companies, marketing is accountedfor internal efficiency through aggregate measures. Thefirms adopt a strong budgetary control, by which the strate-gic board assigns a budget to the department calculated as apercentage of the turnover. In Foodcereal, the budget

1 Protocols and summaries of the interviews are available (inItalian) upon request.

amounts to about the 6–8% of the turnover of the previousyear (according to the expected market growth), while inAirbook it is calculated dynamically: thanks to the informa-tion systems and the strategy of search engine advertisingpursued, it is possible to have a more flexible and timelybudget according to the demand behavior all along the year.The effectiveness of marketing action is analyzed syntheti-cally through a corporate turnover analysis (i.e. single out-put measures). The enabling role of ICTs in MPM clearlyemerges: in a traditional brick and mortar company suchas Foodcereal individual actions or plans are not accountedsystematically due to the difficulties in determining preciseand reliable output variables; as a consequence, aggregatefinancial and non-financial output measures such as turn-over and market share are adopted, though the SBU Finan-cial Manager highlights that ‘‘these measures [turnoverand market share] depend only partly on marketing units.Nonetheless it is difficult for us to find more precise met-rics; this is a significant problem, because, as a matter offact, we use MPM system more as an alert system than asa lever for achieving precise information’’. In fact, the var-iable part of the marketing units� salaries depends only in aslight part (about the 5–10% according to the level of theemployee) on company�s turnover: the strongest emphasisis on behavioral variables (e.g. pro-activity, empathy, prob-lem setting and problem solving skills etc.). This finding isconsistent with Simons (1994), Clark (1999) and Abernethyand Bronwell�s theory (1997), according to whom input/behavioral controls are favored by low task analyzability,i.e. a difficulty for the company to properly account forthe activity. This theory is also confirmed by Airbook�s pro-motion control: as the tools (in general, search engineadvertising, keyword advertising and banners) are imposedby the strategic board, the marketing office is generallyresponsible only for choosing the right keywords/websitesthrough which promoting (thus, quite an analyzable task).The specificities of the promotional channels adopted makeit possible to assess the return on promotions through moreprecise (single) output financial and non-financial measuressuch as click-through rates and cost-per-order. As far as themarketing performances assessed, the cluster shows a clearpreeminence of internal efficiency performances in MPMS,even because the marketing department shows a limitedresponsibility on the interactions of the firm with thesupply-chain, a low involvement in the cross-functionaldecisions, and a poor recourse to forms of customer inte-gration. Moreover, the cases show a wide and almost exclu-sive use of financial and non-financial measures aimed atassessing the aggregate economic returns of marketingactivities.

Finally, the compliance on formal controls is somehowhigher than on informal controls, since also behavioral con-trols are quite structured. As a result, marketing control ispre-eminently bureaucratic in nature.

Relational marketing companiesThe companies within this group show quite clear similari-ties in terms of approach to MPM. If compared to the TMCs,marketing departments in RMCs have different and some-how a larger set of activities to manage. Both the companiesoperate in the industrial market and denote a greater focuson existing customer relationship management than on cus-

Marketing strategy and marketing performance measurement system: Exploring the relationship 149

tomer attraction. In this perspective, the following state-ment by Metalpack�s Marketing Manager is inspirational:‘‘the 85% of our turnover is generated by eight customers,and these customers are the same since early 1990s; wewould be crazy if we wasted resources in trying to acquirenew ones instead of trying to keep these ones’’. Marketing,in both the companies mainly deals with interacting withthe customers, understanding their needs and in sharingthe market intelligence all over the company. As a result,customer integration performances are the extremely rele-vant for the company, and marketing units are accountedfor them through mainly non-financial measures. For in-stance, Metalpack�s marketing units are accounted for theirpro-activity in the consultancy offered to the customers andfor their participation in the intelligence disseminationactivities. Of course, also financial measures of turnoverand customer profitability are present, but their relevanceis lower than in TMCs. Envcons Financial Officer explainsthe point as follows: ‘‘in our business, reputation is every-thing; if we lost reputation, we could not survive; so, be-tween a lower turnover in a year and a decreased trustand satisfaction by our customers, the board would preferthe former [. . .] This does not mean that we do not careabout turnover or short-term results: it only means thatthe role of marketing goes beyond getting a return fromcurrent customers’’.

In both the companies, moreover, marketing units use tointeract with both the non-marketing functions and with thesupply-chain in order to disseminate intelligence and to fa-vour an alignment towards customer satisfaction. Such a re-sult is consistent to the market-orientation theory (e.g.Kohli et al., 1993; Narver and Slater, 1990) and to the morerecent theories on customer-centricity (Sheth et al., 2002;Shah et al., 2006) and Service Dominant Logic (Vargo andLusch, 2004), which affirm the need of a gradual redefini-tion of the marketing practice towards an enlargement inits scope, in order to reinforce the relationship with custom-ers. For instance, when a customer asks Metalpack to pro-duce a new package for a product, a cross-functionalteam composed by marketing, operations and R&D repre-sentatives is constituted. The role of this team (generallymade of 4–5 persons) is to interact with the customer toget the directions to follow, and with the supply-chain (inparticular, the other company�s business units for the rawmaterials and most of the painting, and some external sup-pliers for some highly specialized manufacturing) to get aconsistent alignment of the whole supply system. The inter-nal consistency and the supply-chain integration perfor-mances, as a result, get extremely relevant; nonetheless,companies� management recognizes the existence of severalproblems in defining precise and correct metrics for suchperformances, thus they introduce more behavioral con-trols, interactive and beliefs control systems (Simons,1994); hence, the cluster shows a tendency towards clancontrol (Ouchi, 1980; Jaworski et al., 1993): an enclosureof qualitative (i.e. non-financial) measures and informalcontrols can be observed, even if their relevance seemslower than formal control. This result is consistent to Per-row�s (1970) and Thompson�s (1968) theories, as the enlarge-ment of the set of activities marketing units are responsiblefor induces more variability in the task, thus a greater reli-ance on informal control.

Transactional relational marketing companiesIn their works, Coviello and colleagues refer to this clusteras a group of companies presenting a hybrid situation inwhich TM and RM coexist (Coviello et al., 2002; Brodie andCoviello, 2008). The evidences they gathered never ledthe authors to hypothesize that the behavior of these com-panies could be conceptually different from the juxtaposi-tion of TM and RM practices. As such, it could behypothesized that, whenever the TM and RM companiesMPMS did not show a clear incompatibility in some of theirparts or principles, the TRCs� MPMS would be conceptuallya juxtaposition of the TMCs and RMCs� MPMS. Indeed, evi-dences support this hypothesis. In fact, all the companiesin the cluster show a compresence of the characteristicsof the two models above mentioned: incremental budgetarycontrol on the attraction activities (e.g. Electrap adopts amarketing budgeting process made of a triennial zero-basedbudget followed by two years of incremental budgetingbased on turnover), presence of customer integration per-formances in the MPMS (e.g. in Bank marketing activities�effectiveness is assessed also by a sophisticated long-periodcustomer profitability analysis), presence of cross-func-tional marketing processes, thus of measures aimed atassessing the marketing contribution to internal consistency(e.g. Foodfresh marketing managers have a part of theiryearly bonus depending on an internal climate analysis inwhich other functional managers are asked to express theability of marketing units to coordinate customer-orientedprocesses).

Finally, the concept of MPMS juxtaposition emerges alsoanalyzing the control system adopted: the high reliance onformal control characterizing TMCs is accompanied by ahigh reliance also on informal control (for the same reasonshighlighted in the analysis of RMCs); as a result, evidencessuggest the adoption of high control in the TransactionalRelational Marketing Companies.

The impact of contextual elements on MPMS

The results suggest that two contextual elements may im-pact on the strategy–MPMS characteristics relationship:company size and marketing power within the company.Company size seems to impact on the level of formalizationof the MPMS: SMEs such as Envcons and Bank show marketingperformance measurement systems in which social controland reciprocal fine tuning between the different depart-ments are pre-eminent on structured performance assess-ment procedures. The main cause of this lack offormalization is attributed by interviewees to the cost ofimplementing a complex and formalized MPMS and in thedifficulties in defining non-negotiable marketing perfor-mance standards, as several performances are hardly mea-surable. In fact, as the marketing performances get moremeasurable and the technical feasibility of a structuredassessment gets higher, also small companies introduce for-malized systems, such as the CRM system in Bank, or theprofitability analysis tools for search engine marketingimplemented by Airbook. Larger companies in the samplehave invested in formalization in time; consequently, theyhave more structured MPMS as suggested by literature(Jaworski, 1988; Jaworski et al., 1993; Abernethy and Brow-nell, 1997; Morgan et al., 2002).

150 L. Lamberti, G. Noci

As far as the marketing power concerns, we endorse theapproach followed, for instance, by Homburg et al. (1999)which define it as marketing influence, i.e. the marketingsubunit�s ‘‘exercised power within a business unit, relativeto other subunits, over activities important to the successof the business unit’’ (Homburg et al., 1999, p. 2). Market-ing power has been widely associated to chief marketingofficer (CMO) power (see, for instance, Shah et al., 2006;O�Sullivan and Abela, 2007), and CMO power has been gener-ally associated to her/his presence in the strategic board(see, for instance, Kerin, 2005). Endorsing this approach,we have observed that in companies in which the CMO hasa stronger power (e.g. he/she emerged a member of theboard, he/she emerged to have an active role in the innova-tion processes and in interfunctional coordination, etc.),the effort on marketing performance measurement is higher(and this confirms the results accomplished by O�Sullivanand Abela, 2007), and, in general companies demonstrateto be much confident in their ability to assess marketingperformances. Similarly, whereas companies move towardsa more customer-centric or balanced-centric approach (e.gGummesson, 2008; Sheth et al., 2002), i.e. the satisfactionof customer needs becomes the main prerogative of thefirms� action, the linkage between marketing performancesand firm performances becomes stronger. In fact, the morecompanies are oriented (also) toward relationship market-ing, the more the performances assessed deal with all themain processes in value generation: innovation, supply-chain management, production and, of course, marketing;as a result, the marketing performances are widely consid-ered a fundamental determinant of firm performances. Sucha conclusion could seem in contradiction with the evidencegathered in transaction marketing companies, where mar-keting was accounted for aggregate measures such as turn-over; nonetheless, also the CFOs in those companiesunderline that this approach is by far simplistic and substan-tially incorrect, but they justify this approach affirming thatmarketing performances are hardly measurable. This resulttestifies the criticality of assessing marketing performances,thus encourages further effort to develop better marketingmetrics and design better suited MPMS.

Managerial implications

We believe that this work, and the future research we wishliterature will devote to the marketing strategy–MPMS rela-tionship may benefit practitioners in a twofold manner. Firstand obviously, as extant knowledge on MPMS literature sub-stantially lacks of studies showing the actual marketing per-formance measurement practices in companies, the analysisof the case studies identified some recursive elements thatcan support managers in designing a MPMS. Second, thestudy shows that companies use to lever on soft variablesin order to align employees to the marketing strategy whenmarketing performance measurement is ineffective: com-panies often recognized that marketing performances aretoo difficult to be properly defined and assessed, to grantan accurate outcomes� measurement (indeed, especiallytransactional marketing companies adopt very aggregatemeasures such as turnover); in these cases, behavioral con-trols are widely adopted, and incentives are a widely used

tool for influencing behaviors, in compliance to the theorieson management control under uncertainty (see also Clark,1999; Abernethy and Brownell, 1997). This element confirmsliterature�s intuition about the role of MPMS (and of perfor-mance measurement systems in general) as a system formanaging people and orienting their behavior towards acommon objective (Simons, 1994; Morgan et al., 2002). Thisimplication is even more relevant observing that almost allof the customer-oriented marketing strategies are affirmedto be mainly implemented and institutionalized by employ-ees and their everyday behaviors (Shah et al., 2006; Kohliand Jaworski, 1990; Deshpande and Farley, 1989). Some-how, together with the evidences shown in this paper, thisvery argument suggests that the marketing strategy–MPMSrelationship may exist and it is relevant for companies.

Conclusions

This paper explores the issue of the relationship betweenmarketing strategy and MPMS design. In particular, it drawsfrom extant literature three clusters of marketing strategiesand it analyzes the relevant MPM system characteristics forall of which through a multiple case study analysis in orderto outline possible peculiar approaches to MPM.

The results of the empirical investigation show that thethree clusters of companies indeed tend to adopt MPM sys-tems significantly different the one from the others: RMCsfirms consider marketing as a multifunctional process ofinteraction with the customers, thus as an investment cen-tre. As a result its performances are multidimensional, as-sessed through multiple financial and non-financial, inputand output measures, and they are considered strategicfor achieving the long term corporate targets, as well asfor assessing the meeting with the short term goals. Onthe opposite side, TMCs consider marketing as a functionand as an expense centre, and mainly focus on aggregate in-put and output financial performances, such as turnover andcompliance to marketing budgets (determined according toan incremental approach). Consequently, the informationgathered in the MPM process is scarcely relevant, and it isgenerally misused in strategic decision-making. TRCs showa co-presence of the main traits of TMCs and RMCs� MPM sys-tems. They demonstrate both a high focus on the marketingimplications on supply-chain, and a high effort in pursuingmarketing accountability, and in general they show a wideruse of MPM information in strategic decision-making. More-over the study analyzes the impact of two key-contingentvariables suggested by literature (size and organizationalrole of the marketing department) on the MPMS, showinga substantial alignment with previous studies on the topic.

Being exploratory in nature and adopting a multiple casestudy methodology, this work is subject to two obvious mainlimitations: firstly, the work is affected by the typical short-comings of qualitative research, such as poor generalizabil-ity and strong affection by specific contingencies of thecases. So, the results are useful as a benchmark in studiesconducted with different contextual variables. Nonetheless,such limitation is driven by the poor conceptualization ofthe constructs in marketing performance measurement, awell-known limit of marketing literature (O�Sullivan andAbela, 2007; Morgan et al., 2002; Loning and Besson,

Marketing strategy and marketing performance measurement system: Exploring the relationship 151

2002). Secondly, the choice of a cross-industry sample,though ensuring a general overview of the issue, limits theperspective on the impact of industry-specific variables onthe relationship between marketing strategy and MPM sys-tems. These limitations suggest the immediate next stepsin the research cycle: to achieve a greater generalizabilityof the outcomes, an explanatory research approach is desir-able. Then, industry specific studies may provide with inter-esting insight into the role of contextual variables on thestrategy–MPM relationship, suggesting the MPM system de-sign elements to lever on to be consistent to the companycontingencies. A third element to analyze is the longitudinaldimension of the adoption of a marketing strategy: sincePerformance Measurement Systems are dynamic systemsfollowing strategic change (Simons, 1994), the evolutionarypath of the MPM system in front of marketing strategicchange surely represents an interesting issue in sustainingorganizational change among companies. Finally, and veryimportant, this study confirms that marketing performancemeasurement is a highly relevant issue in the companies,but also that most of the firms� questions are long to be an-swered: almost all the companies are aware of the fact thatthey adopt incorrect or imprecise marketing performancemeasurement systems, and mainly deal with informal, qual-itative and poorly objective measures. In this regards thepaper calls academicians to devote further research efforton marketing control and performance measurement.

Acknowledgements

The authors gratefully thank Andrea Pagnoncelli for his con-tribution in the empirical analysis, Professor Michela Arna-boldi and two anonymous reviewers for their usefulsuggestions.

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LUCIO LAMBERTI, Ph.D., is Business Eco-nomics and Organization lecturer atPolitecnico di Milano. His research interestsare in the field of Marketing, with a specialfocus on Customer-Centric Marketing andMarketing Performance Measurement.

GIULIANO NOCI is Full Professor of Market-ing at Politecnico di Milano, Dean of theDegree in Management Engineering of theComo campus (Politecnico di Milano),Member of the Executive Committee of MIPBusiness School and Scientific Director ofthe Marketing area in all the MBA pro-grammes. His research interests are in thefield of Marketing, with a special focus onmultichannel and mobile marketing. He has

directed and run executive courses and consulting to several man-

ufacturing and service firms.