Reports

Rethinking Market Orientation from the Outside in

George S. Day, 2020, 20-115

The concept of market orientation has been a defining theme of the marketing discipline for more than sixty years. Marketers have embraced their mandate to understand, attract and keep valuable customers. Yet the concept has long suffered from inherent internal contradictions, a diversity of interpretations, and limited influence on strategic thinking.

Here, George Day proposes that these challenges can be addressed by embedding the spirit of a market orientation within a more expansive outside-in approach to marketing strategy. This approach embeds an iterative, learning process within an organization distinguished by five attributes: (1) an expansive perspective using a wide lens and (2) an empathic orientation, that is (3) forward-looking, (4) driven by curiosity, and (5) pervades all levels of the organization.

An iterative, learning process seeks the optimal balance of exploratory and exploitative activities to generate current earnings and fund continued growth. It begins with outside-in questions to set the broad context for inside-out considerations of customer and brand assets to be protected and leveraged, capabilities to be exercised, and constraints to be overcome. Each iterative cycle creates new insights and deeper questions that feed the next cycle through cumulative learning.

An expansive perspective cultivates an informed point of view on the past actions, intentions and likely reactions of the influential elements of the ecosystem, and how they interact with one another. This requires an objectivity (and skepticism) about the future that challenges comfortable assumptions and illusions.

An empathetic orientation tries to see the company through the eyes of customers, channel partners and competitors. The starting point is a deep immersion in available intelligence and the extraction and sharing of insights. When embedded in an organization an empathetic orientation becomes a strategic priority and a cultural value.

Forward looking. An outside-in approach is more about preparedness (to capture opportunities faster than others while parrying threats) than prescience. The aim is to anticipate and understand events and trends in the marketplace to avoid losing degrees of freedom of strategic action, and being forced to act defensively.

Driven by curiosity. Collective curiosity is a key ingredient for a diagnosis of the past (what were the real reasons for our success?), a stimulus for a deeper understanding of present realities (what are the reasons for the marketplace anomalies we are seeing – are they indicator of changes in customer needs and requirements?), and a more informed anticipation of the future.

Pervasive. Outside-in thinking will not permeate the organization without demonstrable commitment from the top. The leadership team signals their commitment by stimulating discovery and debate, encouraging the surfacing of weak signals of threats and opportunities, facilitating sharing of information, and endorsing and rewarding supportive behaviors.

An outside-in approach to strategy is a natural evolution and adaptation of the marketing  concept to changing market realities. Whether the marketing leader evolves to become the authority and advocate for outside-in thinking, depends on their credibility as an adviser to the CEO and their mastery of customer insights, advances in marketing technologies, and foresight capabilities.

 

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