Jonrval of Marketing Management, 1994, 10, 347-360 Christian Gronroos Quo Vadis, Marketing? Swedish School of Toward a Relationship Economics and Business Marketing Paradigm Administration, Th 7 a is 4s ba av fe ‘aki Fi Je marketing mix and its APs have remained the marketns Helsinki, Finland paradigm for decades athe article it is argued thatthe foundation for this paradigm is weak and that it has had negative effects om marketing research and practice. Contemporary research into ser- vices marketing and industrial marketing demonstrates tha! a new approach to marketing is required. This new approach is based on building and management of relationships. A paradigm shift in marketing is under way. The thoughts and actions of marketing academics and practitioners should not be constrained by a para- dignt from the 1950s ard 1960s Introduction The first true analytical contribution to marketing was probably made by Joel Dean (e.g. 1951), an economist. However, marketing the way most textbooks treat it today was introduced around 1960. The concept of the marketing mix and the four P’s of marketing—product, price, place and promotion—entered the marketing textbooks at that time (McCarthy 1960). Quickly they also became the unchallenged basic theory of marketing so totally overpowering previous models and approaches, such as, for example, the organic functionalist approach advocated by Wroe Alderson (1950 and 1957) as well as other systems-oriented approaches (e.g. Fisk 1967 and Fisk and Dixon 1967) and the institutional approach (e.g. Duddy and Revzan 1947) that these are hardly remembered even with a footnote in most textbooks of today. American Marketing Association, in its most recent definition states that “marketing is the process of planning and executing the conception, pricing, promotion and distribution of ideas, goods and services to create exchange and satisfy individual and organizational objectives” (emphasis added) AMA Board 1985). For decades the four P’s of the marketing mix became an indisputable paradigm in academic research, the validity of which was taken for granted (Kent 1986; Grénroos 1989 and 1990a). For most marketing researchers in large parts of the academic world it seems to remain the marketing truth even today. Kent (1986) refers to the four P’s of the marketing mix as “the holy quadruple . . . of the marketing faith . . . written in tablets of stone” (p. 146), As he argues, the mnemonic of the four P’s, by offering a seductive sense of simplicity to students, teachers and practitioners of marketing, has become an article of faith’ (p. 145). For an academic researcher looking for tenure and promotion, to question it has been to stick out his or her neck too far. And prospective authors of textbooks, who suggest another organization than the four P solution for their books, are quickly corrected by most publishers. As a result, empirical studies of what the key market- ing variables are, and how they are perceived and used by marketing managers 0267~257X/94/050347 + 14 $08.00/0 © 1994 The Dryden Press348, Christian Grénroos have been neglected. Moreover, structure has been vastly favoured over process considerations (Kent 1986). In marketing education, teaching students how to use a toolbox has become the totally dominating task instead of discussing the meaning and consequences of the marketing concept and the process nature of market relationships. Marketing in practice has to a large extent been turned into managing this toolbox instead of truly exploring the nature of the firm’s market relationships and genuinely taking care of the real needs and desires of customers. What is the History of the Marketing Mix? A paradigm like this has to be well founded by theoretical deduction and empirical esearch; otherwise much of marketing research is based on a loose foundation and the results of it questionable. Let us look at the history of the marketing mix paradigm and the four P’s. The marketing mix developed from a notion of the marketer as a “mixer of ingredients’, which was an expression originally used by James Culliton (1948) in a study of marketing costs in 1947 and 1948. The marketer plans various means of competitions and blends them into a “marketing mix”, so that a profit function is optimized, or rather satisfied. The “marketing mix’ concept was introduced by Neil Borden in the 1950s (e.g. Borden 1964), and the mix of different means of competitions was soon labelled the four P’s (McCarthy 1960).* The marketing mix is actually a list of categories of marketing variables, and to begin with, this way of defining or describing a phenomenon can never be con- sidered a very valid one. A list never includes ail relevant elements, it does not fit every situation, and it becomes obsolete. And indeed, marketing academics every now and then offer additional P’s to the list, once they have found the standard “tablet of faith” too limited. Kotler (1986) has, in the context of megamarketing, added public relations and politics, thus expanding the list to six P’s. In service marketing, Booms and Bitner (1982) have suggested three additional P’s, people, ptysica! evidence and process. Judd (1987) among others, has argued for just one new P, people.t Advocators of the marketing mix paradigm sometimes have suggested that service should be added to the list of P’s (e.g. Lambert and Harrington 1989 and Collier 1991). It is, by the way, interesting to notice that after the four P’s were * McCarthy was not, however, the first person to organize marketing variables in a four P-like structure. The first marketing textbook organized in this way was published by Harry Hansen (1956), where he used the following six categories: product policy, distribution channel, advertising, personal selling, pricing and sales programs (see Shugan, forthcoming). + As a matter of fact, even in the homeland of the marketing mix there has been at least some debate about this paradigm. However, the basic way of handling the problem has always been to use the same clinical approach, i.e, to simplify the market relationship by developing a list of decision making variables. No real innovativeness and challenge of the foundation of the paradigm have been presented. In the 1960s and early 1970s, categories which did not begin with the letter P were suggested; e.g. Staudt and Taylor 1965, Lipson and Darling 1971 and Kelly and Lazer 1973 tiree categories each), whereas the letter P almost always has been present in lists of categories put forward in the 1980s and 1990s; e.g. ‘Traynor 1985 (five categories), Johnson 1986 (12), Keely 1987 (four C’s), Berry 1990, Mason and Mayer 1990 (six), Collier 1991 (seven) and LeDoux 1991 (five). } This would be disastrous, because it would isolate customer service as a marketing variable from the rest of the organization, just as has happened with the four P marketing mix variables. It would effectively counteract all attempts to make customer service a responsibility of everyone and not of a separate department only.Quo Vadis, Marketing? 349 definitely canonized sometime in the early 1970s new items to the list are almost exclusively put in the form of P’s.§ Itis also noteworthy that Borden's original marketing mix included 12 elements, and that this list was not intended to be a definition at all. Borden considered it guidelines only, which the marketer probably would have to reconsider in any given situation. In line with the “mixer of ingredients” metaphor he also implied that the marketer would blend the various ingredients or variables of the mix into an integrated marketing program. This is a fact that advocators of the four P's (or five, six, seven or more P’s) and of today’s marketing mix approach seem to have totally forgotten. In fact, the four P’s represent a significant oversimplification of Borden’s original concept. McCarthy either misunderstood the meaning of Borden’s marketing mix when he reformulated the original list in the shape of the rigid mnemonic of the four P’s where no blending of the P’s is explicitly included; or his followers misin- terpreted McCarthy’s intentions. In many marketing textbooks organized around the marketing mix, such as Philip Kotler’s well-known Marketing Management (e.g. 1991), the blending aspect and the need for integration of the four P’s are discussed, even in depth, but such discussions are always limited due to the fact that the model does not explicitly include an integrative dimension. The original idea of a list of a large number of marketing mix ingredients that have to be reconsidered in every given situation was probably shortened for peda- gogical reasons and because a more limited number of marketing variables seemed to fit typical situations observed by the initiators of the short list of four standard- ized P’s. These typical situations can be described as involving, consumer packaged goods in a North American environment with huge mass markets, a highly com- petitive distribution system and very commercial mass media. However, in other markets the infrastructure is to varying degrees different and the products are only partly consumer packaged goods. Nevertheless the four P’s of the marketing mix have become the universal marketing theory and an almost totally dominating para- digm for most academics, and they have had a tremendous impact on the practice of marketing as well. Is there any justification for this? Let us first look at the paradigm itself. The Nature of the Marketing Mix As has previously been said, the marketing mix is a list of variables, and we have already pointed out the shortcomings of such a way of defining a phenomenon. Moreover, any marketing paradigm should be well set to fulfil the marketing con- cept, i.e. the notion that the firm is best off by designing and directing its activities according to the needs and desires of customers in chosen target markets. How well is the marketing mix fit to do that? One can easily argue that the four P's of the marketing mix are badly fit to fulfil the requirements of the marketing concept. As Dixon and Blois (1983) put it, “. . - indeed it would not be unfair to suggest that far from being concerned with a customer's interests (i.e. somebody for whom something is done) the views implicit § In spite of all the additional categories of marketing variables that have been offered by various authors, there is only one textbook that is thoroughly based on anything else than the four P’s: Donald Cowell's (1984) book on the marketing of services which is organized around the seven P framework.