This essay has been submitted by a student. This is not an example of the work written by our professional essay writers.
Entrepreneurial Marketing is the combination of two discrete management areas. Existing as distinct disciplines, entrepreneurship and marketing have emerged to capture the several facets of marketing that are often not explained by existing traditional marketing theories and concepts.
Definitions of both marketing and entrepreneurship differ considerably and we cannot expect that one single definition of entrepreneurial marketing will cover everything.
A contemporary definition that meets the present scope is that of Morris (2002, p. 5) in which entrepreneurial marketing is defined as: "the proactive identification and exploitation of opportunities for acquiring and retaining profitable customers through innovative approaches to risk management, resource leveraging and value creation."
Recently, entrepreneurial marketing has gained popularity in the marketing and entrepreneurship disciplines. The success of business activities pursuing non-traditional marketing approaches can be attributed to entrepreneurial marketing practices. Despite the large numbers of marketing models and concepts, there are notable successes that deviate from these and are labeled "entrepreneurial."
Economic growth has become a necessity in many countries which has led to a growing need for entrepreneurship in society. When large companies' follows economies of scale by downsizing and reducing staff, the small and medium sized enterprise sector (SMEs) becomes more important.
Till recently, entrepreneurship and marketing existed as two independent, intellectual domains. In the past few years, the growing number of entrepreneurship research has resulted in to a number of findings which led to the improvement of the marketing knowledge.
In general, marketing has always aimed on understanding the processes and practices within big companies. However, in parallel with a growth in entrepreneurial behavior and small to medium enterprise sector worldwide, the marketing aspects of small & medium sized companies and entrepreneurship have also increased in importance.
Entrepreneurial behavior has been traditionally rooted to the small to medium sized enterprise sector, but entrepreneurial marketing also has a definite impact on large companies. Today, many companies operate in a very turbulent environment where there are increased risks and a diminishing ability to forecast and project. In this environment of sudden changes organizational boundaries have become very unclear.
In business environments like this, business managers has to forget traditional management policies and replace them with new thinking and new behavior that will not only incorporate changes but also create the necessary changes in the marketplace. Entrepreneurship may well be the vehicle for this and entrepreneurial marketing behavior may be of the utmost importance for many large firms and SMEs alike.
The roots of entrepreneurial marketing are considered to be grounded within the SME (Small to Medium Enterprise) sector to the some extent. Indeed, there is a strong argument among the marketing gurus that entrepreneurial marketing is really about SME marketing. Within the generic marketing management literature also is a stratum of thought that suggests EM is somewhat like "textbook" marketing, but undertaken either with some flair or just simply doing something completely different across all aspects of the normative marketing mix (Earls 2002; Chaston 2000). This is more visible in the execution and implementation of creative promotion strategies. Some argue that this approach is perhaps, on the one hand, what marketers should be doing anyway and on the other, it may overlook the complex subtleties that underpin an entrepreneurial approach to market development. According to Bjerke and Hultman, being entrepreneurial however is not a necessary prerequisite as they argue that not all small to medium sized firms are entrepreneurial, but these firms will need entrepreneurship in order to grow and expand and such growth can be achieved from the small firm's advantage in marketing. In smaller firms decision making tends to originate from entrepreneur and they are able to act on opportunities and implement strategies faster than larger firms could. Bennett and Cooper (1981, 1984) suggest that the stagnation of innovation in large firms is due to theoretical and traditional marketing practices where the focus is on meeting explicitly expressed needs of the customers.
Here, the concept of customer value must be introduced to further develop the argument. Entrepreneurial marketing, like marketing in general, can be seen in terms of value creation processes. According to Bjerke and Hultman, 2002 the ultimate purpose of marketing is to create something that buyers can use to produce own customer value, the offer to the market. In all stable markets, certain levels of perceived customer value, or the differentiation of customer value between sellers, have become established; the value balance. Customers have expectations, and if these expectations are met, repeated buys will occur which will help the sellers to maintain their market positions. A traditional market strategy is to become a market leader and a dominant player and to establish a level of expected customer value which will help the firm to exploit with profit. Another way to express this is that the dominant firm should set the rules of the game between sellers and buyers. One of the main strategies in maintaining competitive advantage is to take actions that stabilize the market as much as possible and exploit the economies of scale in one's own production.
The argument here revolves around the notion that size affects the firms approach towards marketing decisions. Bjerke and Hultman (2002) propose that in this era of dramatic social and technological change, one approach for firms to establish and sustain long-term customer relationship is through EM facilitated by a four-pillar framework comprising of entrepreneurship, resources, processes, and actors (entrepreneur, coordinating firm, and network).
Marketing is a challenging process for any organization. In a survey of entrepreneurs around the world Hisrich (1989) found finance and marketing to be the leading problem areas for entrepreneurs. It is true that a model that works for one firm may not work for another firm. Many marketing gurus have been engaged in an ongoing argument within literature as to the very nature of marketing and the fit between theory and practice. Indeed there has been a growing and focused literature that the SME conducts a different type of marketing to that of the large firm. For example, large firms are likely to follow set procedures of marketing (e.g. outsource marketing efforts, etc.). Smaller firms more often conduct their own marketing campaigns in house. The main reason behind conducting in house marketing is capital and cash constraints.
There are also thoughts that suggest that such marketing activity represents marketing in its purest form "its marketing but not as we know it" (Deacon and Corp 2004). Indeed Carson, Gilmore and Grant claim that: "SME's do not conform to the conventional marketing characteristics of the marketing textbook theories." However they are not the only one in that view, nowadays it is increasingly seen that marketing as perceived and undertaken by entrepreneurs is very different to the concepts that are presented in conventional textbooks and other theories (Stokes and Lomax 2002; Hulbert, Day and Shaw 1998; Copley 2002b; Forsyth and Greenhough 2003).
Carson and Gilmore (2000) propose that the stage of the small enterprise moving to medium enterprise (SME) lifecycle and the prevailing industry norms are two 'fundamental pre-requisites' this will show the approach to marketing taken by the SME. However these things must be placed against the backdrop of the personal characteristics of the owner/manager/entrepreneur as 'the rationale of the small firm is the rationale of the owner' (Bjerke and Hultman 2002) and the two cannot be separated from each other in order to ease conceptual formation.
The first of these life cycle stage - suggests that as the small and medium sized firm maturates so does their approach to marketing. The second: conformity with industry norms - focuses on the industry norms in which the small and medium sized (SME) firm exists. According to Fuller (1994) small firms usually conform to the norms that are firmly established within the industry to which the firms belongs, as a small firm will not have enough resources or to the matter of fact even the motivation to challenge industrial rules. Historically it is evident that industrial convention can be challenged by those outside the industry and increasingly it is the small firm with exceptional market sensing and policies that can make such a challenge (Enright 2001). For example, Kay (1995) points out that customers pay little interest in industries but pay a lot of interest to having their needs met.
Carson and Cromie (1989) claim that the personality of the entrepreneur and the industry in which the entrepreneurial oriented firm operates is likely to exhibit a market development orientation and that both are related to the overall organizational culture. Deacon (2002) concurs that the "personality" of the firm is connected to the personality of the entrepreneur.
Overall, it is strongly argued that marketing is performed differently in Small to Medium sized Enterprises (SMEs) than in large firms based on distinct dimensions. The way that small and large firms approach marketing decision-making is different. Decision-making in large organizations tends to be made within ordered framework and in highly structured manner. Decision making in large companies often follows a clear hierarchy. Often the processes are based on sound theories and accepted practices. In small firms the decision making process is different and tend to originate from and flow through the entrepreneur or owner and it is their personality and style that shape the nature of the decisions.
Similarities in decision making between the large corporations and small to medium sized enterprises include innovation and creativity, opportunistic and not afraid to take risks, etc.
Finally, it is important to state that, entrepreneurial marketing must be regarded as a supplementary to the existing general marketing theories. The area is not revolutionary in the sense that existing marketing perspectives are regarded as being obsolete! But entrepreneurial firms, large as well as Small to Medium sized Enterprises, represent a substantial part of the economy. The marketing behavior of such firms needs to be considered within marketing boundaries; such research has a lot to contribute to the development of modern marketing theory.
The future research will expose to what kind of influence will mainstream marketing theories and business behavior on entrepreneurial marketing will have. The competition in the market and turbulence can be expected to increase. Present trends, such as technological developments as well as R&D and manufacturing of the goods at very low cost, offer opportunities to new players and aggressive entrepreneurial firms to easily enter the market. Depending on their ability to exploit the new trends, small and medium businesses can be expected to grow fast and also increase their profits heavily.