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Technology, consumers, and marketing theory

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Technology, Consumers, and
Marketing Theory
Nikhilesh Dholakia, Detlev Zwick,
and Janice Denegri-Knott
INTRODUCTION
Technology-related turning points that reshape
the direction of marketing usually become
apparent only in the clear light of hindsight.
Sometimes, though, market and commerce-
shaping technological breakthroughs are fore-
seen in prescient ways. Prior to the famed
‘Golden Spike’ at Promontory Point in Utah
that linked the East and West of continental
United States by railroad in 1869, three other
commemorative spikes were driven. The one
from the territory of Arizona bore this inscrip-
tion: ‘Ribbed with iron clad in silver and
crowned with gold Arizona presents her offer-
ing to the enterprise that has banded a conti-
nent and dictated a pathway to commerce’.1
This inscription foresaw the momentous
promise, if not the exact pattern, of continental
commerce unfolding with railroads.
From telegraph, railways, and automobiles
to television, jets, and the Internet, technolo-
gies that reshape and transform markets seem
to appear every few decades. This chapter
explores the interplay between technology,
consumers, and marketing – particularly
5339-Maclaran-Chap 28.indd 494
28
marketing theory. Our approach is based on
a theory of technology that aligns itself with
a ‘soft’ form technological determinism (see
Smith and Marx, 1994). This view holds that
changing technologies will always be only
one factor among many others – including
political, cultural, and economic ones –
responsible for changing economic and mar-
keting processes. Soft technological
determinism thus overcomes the simplicity of
‘hard’ technological determinism that pro-
poses a simple cause–effect relationship
between technological change and changes in
social, economic, or managerial practices
(MacKenzie and Wajcman, 1999). In essence,
our view of technology – probably best rep-
resented by Winner’s (1986, 1999) idea of
‘political technology’ – states that by adopting
a particular technology a person, business,
or institution may be opting for a lot more
in terms of social, political, economic, and
cultural implications than a straightforward
assessment of the technology’s ‘objective’
instrumental capabilities would suggest.
Thus, not all implications of a technological
choice, such as, for example, the adoption of
9/1/2009 12:15:00 PM
 TECHNOLOGY, CONSUMERS, AND MARKETING THEORY
a new customer relationship management
(CRM) system, may be aligned with the
user’s initial need for the technology. Such a
statement – in fact our entire argument – does
not at all exclude the possibility that the adop-
tion of technologies such as CRM or Radio
Frequency Identification [RFID] provides
functional advantages and important opera-
tional efficiencies. However, such a purely
instrumental perspective limits the analysis
to how technology is adopted and used.
Our approach to marketing and information
technology, while encompassing adoption
and usage, also stresses the aspects of how
to shape technology and how technology
shapes marketing practice (cf. MacKenzie
and Wajcman, 1999). After a brief historical
excursus into the nexus between marketing
and technology, we turn to new information
technologies from the mid-1990s onwards.2
To establish a conceptual base for the
chapter, we first examine the core character-
istics of new information and communication
technology that usher in accretive and accel-
erative impacts on consumers and markets,
trigger major transformations, or do both. We
then focus on three issues: (1) Is there an emer-
gent theory, or are there emergent theories,
of information technology marketing? (2) Is
there an emergent theory, or are there emergent
theories, of technology consumption? and (3)
How do new information technologies shape
or inform major theories in marketing in areas
such as customer relationship management,
co-creation, customer centricity, and loci of
control in the value creation and consumption
process? The chapter ends with some sugges-
tions for a future-oriented research agenda
about technology and marketing theory.
BRIEF HISTORICAL EXCURSUS
Technology adoption processes have held the
interest of researchers in marketing and
social sciences for several decades (Gatignon
and Robertson, 1985). Technology also
has been recognized as a key factor driving
5339-Maclaran-Chap 28.indd 495
495
strategy – not only R&D aspects but also
marketing and product portfolios – of many
firms (Capon and Glazer, 1987).
By the 1980s, there was a realization in
some of the writings related to marketing and
consumer behavior that in products and serv-
ices infused with significant doses of advanced
technology (or ‘high technology’), the mana-
gerial practices as well as consumer behaviors
were different than for conventional consumer
or industrial products and services (see
Dholakia et al., 1991; Ford and Ryan, 1981;
Higgins and Shanklin, 1992; Shanklin and
Ryans, 1984; Venkatesh and Vitalari, 1987). For
consumer high-tech products, for example, it
came to be recognized that adoption becomes
just a first step in a process of change that
could alter household dynamics (Venkatesh
and Vitalari, 1987), the emotional coping
mechanisms of consumers (Mick and Fournier,
1998), and psychological experiential states
(Hoffman and Novak, 1996).
For high technology in general and infor-
mation technology in particular, there is evi-
dence of the ongoing erasure of the boundary
between the spheres of production and con-
sumption (Vargo and Lusch, 2004) and also
increasing available research-based insights
about the transforming impacts that consumers
have on the application ranges of technological
products and services they adopt and use (Shih
and Venkatesh, 2004).
The warp of technology is getting steadily
interwoven into the weft of commercial proc-
esses that connect marketers and consumers
and of processes within consumers’ lifeworlds.
The former, the commercial side interweaving
of technology, has led to great interest in the
methods and impacts of electronic commerce
and mobile commerce (Dholakia et al., 2002;
Dholakia et al., 2006). The latter, the focus on
technology in consumer lifeworlds, is spawn-
ing studies of technology consumption as
object–subject theater and of intersubjective
performative processes wherein connected
consumers rely on technological platforms
in attempts to play David – like heroic roles in
the Goliath – webs of networked technolo-
gies (Zwick and Dholakia, 2006a,b).
9/1/2009 12:15:00 PM
 496 THE SAGE HANDBOOK OF MARKETING THEORY
As technology penetrates deeper into peo-
ples’ lifeworlds, the studies of technology –
from marketing and consumer research
perspectives – are expanding from adoption
and post-adoption issues, and including
larger concerns. Such studies are beginning
to explore the transformative nature of the
market economy and of the cultural spaces
that consumers inhabit. For example, from a
sweeping review of technology and con-
sumption, Kozinets (2008) concludes that:
… although we know much about the general
macrosocial and cultural conditions surrounding
technology consumption, we discover a surprising
gap in our knowledge about the nature and proc-
esses by which these conditions form into ideolo-
gies and how these ideologies influence consumers’
thoughts, narratives, and actions regarding tech-
nology. (p. 865)
Based on extensive interviews of technol-
ogy users, Kozinets (2008) concludes that the
‘ideologies of technology have become inter-
woven with almost every realm of human
endeavor and imagination: mundane and lofty,
work and play, sex and food, progress and
improvement, communication and pleasure …
there seems very little ideological space left for
consumers to construct a viable oppositional
viewpoint. Indeed, most solutions to social
and environmental problems now involve
adaptations of technology …’ (p. 879).
From an instrumental position, technology
has come to assume an enveloping character –
many commercial processes and consumption
processes have become so suffused with
technology that it is impossible to separate the
impacts of technology from the phenomena
being studied.
CONCEPTUALIZING HIGH
TECHNOLOGY
Especially since the 1980s, information and
communication technologies (ICTs) – customer
databases, e-commerce methods, information
systems, mobile communication devices, and
5339-Maclaran-Chap 28.indd 496
the Internet – have increased dramatically in
their global reach and social impact (Castells,
1996; Lyotard, 1984). ICTs represent one
of the main driving forces behind major
economic, social, and cultural shifts from the
modern to the postmodern, from local to
global markets, from production to consump-
tion, and from industrial to informational
economies.
Two of the most important contemporary
transformative processes – the rise in informa-
tion-producing, information-manipulating,
information-distributing, and information-
consuming technologies; and the increasing
globalization of markets accompanied by the
growing prominence of global (including
‘glocal’) marketing activities – are in a sym-
biotic embrace. Information, technology,
the market, and marketing have become
dominant metaphors of the discourses of
affluent societies as well as the emerging and
developing nations.
With affordable ICTs pervading the planet,
consumption experiences and marketing are
increasingly represented through the concept
of ‘data’. Information, more than at any time
before, has become the essence of the market
(Knorr Cetina and Preda, 2005). Organic and
innocuous sounding descriptions of informa-
tion as ‘flowing and circulating’ mask the
dramatically growing quantity, intensity, com-
plexity, and opacity of informational proc-
esses. Consumers often feel overwhelmed and
intimidated by the sheer volume of informa-
tion available for consumption. Marketers have
responded to information overload with
‘solutions’ that seem to mimic the problem: a
deluge of search tools, buying guides, top-ten
lists, and direct marketing formats offering
highly targeted (and hence presumably more
relevant) digests, summaries, and ‘deals of
the week’ (Cohen and Rutsky, 2005).
On the production and supply side, ICTs
enable arcane repackaging of data into trans-
actable intangibles – creating pyramidal struc-
tures of derivative products and services.
From the perspective of marketing and con-
sumption, then, the impact of high technology
and ICTs has been the transformation of
9/1/2009 12:15:00 PM
 TECHNOLOGY, CONSUMERS, AND MARKETING THEORY
physical marketspaces into datascapes
encompassing not only an increasing per-
centage of customer transactions but also, for
example, the real-time tracking of the global
movement of commodities and their many
components. Changing customer preferences
appear on the informational market map as
intensifying and diminishing data streams and
in a more general sense, the understanding of
market and marketing objects (perceived
value, goods, segment, communication, con-
sumer, need, supplier, etc.) has been recoded
as the exposure to various and always chang-
ing patterns of data. This model thus involves,
at least in theory that the productive decision
actually comes after and in reaction to the
market decision. Hence, communication and
information play a newly central role in pro-
duction. ‘One might say that instrumental
action and communicative action have become
intimately interwoven in informationalized
industrial processes’ (Hardt, 1999). The result
is a more or less seamless and extremely fast
cybernetic system of stimulus, feedback, and
reaction, with a subsequent stimulus repro-
ducing the cybernetic loop. Put differently,
the contemporary mode of information mar-
keting must be understood as a dynamic
process where existing information systems
and customer data continuously inform each
other with each new interaction between the
system and the customer. Hence, flexibility
becomes a very instructive concept to express
the effect of the interaction of information
technology and marketing theory and practice.
By mapping the flows of goods, finances,
ideas, and individual consumption in a com-
prehensive electronic data system the foun-
dation is laid for circular, recursive, and
self-reproducing strategies of marketing
power aimed at forecasting future customer
positions ‘in an increasingly dispersed and
automated infoscape’ (Elmer, 2004: 44; see
also Bogard, 1996.
A cybernetic approach that centers the
notion of flexibility recognizes the need for
information technology marketers to actively
solicit consumers for information, hence con-
ceptualizing the building, mining, updating,
5339-Maclaran-Chap 28.indd 497
497
and distribution of customer data as a key
component in the management and modula-
tion of all other elements of marketing strategy.
It is therefore fair to say that the increasingly
tightly knit liaison between contemporary
ICTs and the theory and practice of modern
marketing raises new questions about what it
means ‘to market’ – but also ‘to consume’ – in
the age of information- and communication-
driven market spaces (Cohen and Rutsky,
2005; Rayport and Sviokla, 1994; Zwick and
Dholakia, 2004b). We now turn to a review of
two key concerns, which have been dominant
in the marketing literature – the distillation
of both accretive and accelerative impacts
of ICTs on marketing practice by way of
situating and contrasting emerging theories
on technology, marketing, and consumption.
Accretive and accelerative impacts
Technologies have historically accelerated
market-related processes and have added to
productivity and capacity of organizations at
steady or even declining costs. The inaugural
speech of Abraham Lincoln took two weeks
to reach from Washington, DC to the western
coast of the still-evolving United States. The
inaugural address of Barack Obama was not
only heard and seen instantly the world over,
in select locations telepresence technologies
created real-time, three-dimensional simula-
tions of the oath-taking ceremony. Over time,
technologies have increased the speed, capac-
ity, dimensionality, and vividness – and
decreased costs – of communication and
transaction processes. ICTs continue to play
this traditional role of technologies in terms
of enhancing marketing processes while
increasing their efficiency. Combined with
globalization, ICTs are now deployed over
globe-spanning interorganizational fields
to push down costs of front-end marketing
processes such as call centers and tech sup-
port, mid-chain processes such as customer
relationship management, and back-end
processes such as mining of customer data
warehouses (Dholakia and Dholakia 2009).
9/1/2009 12:15:00 PM
 498 THE SAGE HANDBOOK OF MARKETING THEORY
Much research to date has highlighted the
role of technology in accelerating and expand-
ing marketing functions, by way of heralding
a more efficient and integrative role for mar-
keting practice within organizations (Achrol
and Kotler, 1999; Bruce et al., 1996; Piercy,
1985). That marketing has become more cen-
tral to the functioning of organizations has
generally been founded upon the mantra that
information is a corporate asset and that its
acquisition, management, and distribution are
tasks that marketing is best positioned to do
(Achrol and Kotler, 1999; Capon and Glazer,
1987; Piercy, 1985). This has been said to be
especially true in dynamic, knowledge rich
environments, where organizations operating
as networks of internal suppliers, distributors,
and consumers, require a timely and coordi-
nated approach (Achrol and Kotler, 1999). In
that equation, ICTs enable the marketing
department to operate as a key resource of
the organization by expediting the analysis of
market intelligence and monitoring trends,
by producing virtually instantaneous matches
between product offerings and consumer
needs, and by more accurately evaluating the
effectiveness of any marketing program. It
follows then, that the process of ‘doing mar-
keting’ is accelerated and enhanced with smart
systems connecting various nodes of the value
chain such as suppliers, inbound logistics,
production processes with outbound logistics,
as well as sales and marketing (Archol and
Kotler, 1999; Capon and Glazer, 1987;
Rayport and Sviokla, 1995, 1999).
That line of analyses has only been accen-
tuated with the growing popularity of the
Internet and other digitized media, like digital
TV, Global Positioning System (GPS) track-
ing devices and mobile phone technology for
commercial purposes. Studies in e-commerce
and interactive marketing for some time have
been pointing out the benefits of ICT adoption
including increased speed and reach in com-
munication at lower costs (Hoffman and
Novak, 1996; Watson et al., 2000), the poten-
tial to add value through information enabled
services like product tracking and customiza-
tion (Rayport and Sviokla, 1995; Watson et al.,
2000), improved flexibility in pricing, more
5339-Maclaran-Chap 28.indd 498
efficient processing of enquiries and orders,
and superior customization of products and
services (Shugan, 2004). In addition, infor-
mation and communication technologies have
been credited with gifting marketing practice
with a completely new set of capabilities that
make it possible to deal with dynamic demand
conditions through flexible production
regimes, stock management, interactive price
mechanisms, and adaptable product market-
ing strategies including bundling, temporary
sales, and forward sales.
Early analyses of the impact of internet
technology on marketing practice ushered in
a new dawn for the discipline characterized
by its global reach, increased information
symmetries between consumer and company,
multi-directional nature of market communi-
cation, digital delivery of goods and services,
and possibilities to study and know consumers
(Hoffman and Novak, 1996; Kozinets, 1999;
Zwick and Dholakia, 2004a). In particular the
database-driven Internet should be singled out
as a revolutionary marketing technology,
because its ability to generate, store, and ana-
lyze customer data renders the consumer a
more accessible and actionable subject for
marketing intervention (Arvidsson, 2004;
Zwick and Dholakia, 2004b). As consumer
behavior in online communities and market-
places can immediately be captured, modeled,
analyzed, and fed back to the virtual con-
sumer, a closed loop of manifested consumer
behavior, real-time analysis, and modulated
marketing interventions and tactics is estab-
lished (Blattberg et al., 1994; Elmer, 2004).
Marketing research has documented the
emergence and integration of technology into
marketing practice as an evolutionary process
where gains in efficiency are achieved initially
through process automation and later in the
accruement of innovative practices aimed at
creating increasingly fluid and constant inter-
actions between the front, mid, and back
process of marketing (Achrol and Kotler,
1999; Brady et al., 2001; Haeckel, 1985;
Nolan, 1973). Early research concentrated on
the effects of newly available computational
speeds and efficiencies. Nolan (1973, 1979)
wrote about the automation and administration
9/1/2009 12:15:00 PM
 TECHNOLOGY, CONSUMERS, AND MARKETING THEORY
of databases, Hedberg (1980) explained ways
in which increased data processing capabili-
ties can be integrated into organizational
production and marketing processes and
later, Long’s (1984) work illustrated the pro-
gression of change and efficiency in the auto-
mation of sales management and selling
processes through telecommunication tech-
nologies. As Haeckel (1985) points out,
inventory record keeping systems of the late
1950s and early 1960s were later transformed
into inventory management systems and then
real-time market systems. In the 1990s,
emphasis was placed on how databases could
be used not only to realize sales but increas-
ingly also to improve how the marketer would
relate to customers on a one-to-one basis
(Stump and Sriram, 1997). Such enthusiasm
filtered into the relationship marketing litera-
ture, where technological determinist acco-
lades for ICTs where recurring themes for
describing how relationship building and
maintenance in consumer and business con-
texts were enhanced with the use of a wide
range of technologies, including databases,
emails, websites, telephone interaction and
loyalty cards (Berry, 1983; Hammer and
Mangurian, 1987; Stump and Sriram, 1997).
The argument coming out of this research is
that intelligent and integrative ICTs platforms
gift organizations with control and opera-
tional effectiveness in areas such as pricing,
product development, customer service, cus-
tomer relationship management, branding,
stock inventory management, and marketing
information systems. Invariably, the aforemen-
tioned research has also gestured the role of
ICT as a catalyst of transformational proc-
esses, where the ultimate commodity is data
produced about the consumer and we may now
add, produced by the consumer.
Transformational processes
At the leading edges of ICTs, especially the
virtual social space-creating technologies,
evidence is building up of uncertain and
potentially potent transformational market-
ing processes and consumption settings.
5339-Maclaran-Chap 28.indd 499
499
There is sobering realization that powerful
transformative forces have been unleashed by
such ICTs (ref), and that – from the perspec-
tive of corporations – ways must be found to
bend such forces in the service of capitalism
(Parise and Guinan, 2008).
From a production perspective, informa-
tion and communication technologies have
been theorized as product and producer of a
more general economic transformation from
an energy-intensive to an information-intensive
economic system characterized by advances in
the technological base, changes in the nature
of commodities, and dramatic time–space
compression (Harvey, 1989; Kumar, 1995;
Liagouras, 2005).
The electronic and information revolutions
of the last two decades not only affect how
work gets done but also what kind of work
generates the bulk of surplus value (see e.g.,
Allen and Scott Morton, 1994). The empha-
sis is no longer on the development of tech-
nologies that have the ability to replicate and
replace hard physical labor but on machines
that allow for the manipulation of symbols
and for the production and representation of
information (Joschner, 1994; Kumar, 1995).
In short, postindustrial technologies do not
replicate manual labor as much as they enable
and automate knowledge work. Consequently,
the dominant strategy of value creation in
information capitalism is focused on expand-
ing, proliferating, and improving symbolic
and communicative systems, rather than on
the mass production of physical goods
(Castells, 1996; Hardt, 1999; Liagouras,
2005: 21). Put differently, the manufacturing
of material components of commodities has
become less value-added (and hence less stra-
tegically important for the company) than the
production of emotional, intellectual, com-
municative, and aesthetic components (Lash
and Urry, 1994). When value generation is
the outcome of such informationalized pro-
duction processes – what Gorz (2004) has
eloquently conceptualized as ‘immaterial
labor’ in the context of the knowledge society
(see also Hardt and Negri, 2000; Lazzarato,
1996; Virno, 2004) – economic value becomes
a function of the degree to which time and
9/1/2009 12:15:00 PM
 500 THE SAGE HANDBOOK OF MARKETING THEORY
space can be compressed in the production
cycle (Harvey, 1989).
Usually notions of time–space compression
refer to the discussion about the acceleration
of global capitalism (e.g., Gee et al., 1996). As
Castells (1996: 92) puts it, ‘[T]he informa-
tional economy is global.[…] It is an economy
with the capacity to work as a unit in real time
on a planetary scale’. While the new realities
brought about by the worldwide real-time
interconnectivity of complex and spatially
dispersed production systems has garnered
most of the attention of theorists of informa-
tion capitalism, there are other ways in which
advanced economies rely on time and space
compression to produce value. They are
related to the shift from the production of
capital-intensive, tangible commodities to the
production of knowledge-intensive, ‘intangible’
value such as market information, business
intelligence, patents, brands, and community
(Arvidsson, 2006; Hardt and Negri, 2004;
Lury, 2004). The focus here is on the acceler-
ated interaction between consumption and
production traditionally expressed in manage-
ment concepts such as Toyotism, just-in-time,
and lean manufacturing (Thrift, 2005) and
more recently in marketing practices that uti-
lize the Internet to establish even more imme-
diate and productive relationships involving
consumers directly in co-creation and innova-
tion processes through more or less managed
mass collaboration systems (Kozinets et al.,
2008; Tapscott and Williams, 2006; Zwick
et al., 2008). Hence, and as we describe in more
detail in the following section, perhaps the
most profound outcome of the information
revolution is that the spheres of production and
consumption become increasingly difficult to
differentiate and may ultimately collapse into
each other.
EMERGING THEORIES OF
TECHNOLOGY AND MARKETING
The questions that scholars of marketing and
consumption now confront are whether, and
if so, to what extent and how new ICTs create
5339-Maclaran-Chap 28.indd 500
markets in which consumers with highly dis-
similar economic, cultural, and intellectual
resources can join the world of business in
general, and goods and services in particular.
As Arvidsson (2005: 43) points out, ‘[I]nfor-
mation provides an interface on which mar-
keting can act’. Information, however, also
provides an interface on which consumers,
micro entrepreneurs, and communities can act
vis-à-vis large and powerful marketing sys-
tems, contesting and changing existing ones
or establishing new, innovative, and locally
more relevant ones (Kozinets et al., 2008;
Tapscott and Williams, 2006). Large-scale,
deep transformations in the development,
distribution, and deployment of ICTs we have
witnessed since the 1980s – including their
dramatic acceleration since 2000 – lead to a
significant extension of the ways marketing is
able to effect systemic–managerial changes.
While much has been written about market-
ing, technology, public policy, and consump-
tion – with few exceptions – such works have
taken the notions and categories of marketing
(and consumption) for granted. Marketing, in
other words, is regarded as an a priori category
onto which new technologies are simply over-
laid as they come along. As our summary of
accretive and accelerative impacts revealed,
new ICTs are discussed in terms of either the
ability of companies to improve production,
marketing, and distribution, or the capacity of
consumers to process information and make
decisions. The focus of such analyses is on the
exploration of instrumental, strategic, and
economic outcomes of inserting new informa-
tion technology into the marketing processes.
From this functionalist perspective of mar-
keting (Zwick and Dholakia, 2004a), infor-
mation technologies are evaluated, analyzed,
and discussed almost exclusively in terms
of their ability to optimize the effect of the
marketing mix, provide competitive advan-
tages, and support strategic tasks such as
segmentation, targeting, and positioning.
Notions about the transformative impacts of
ICTs on the marketing systems – but also the
mode of consumption – rarely figure in any
serious conceptual manner.
9/1/2009 12:15:01 PM
 TECHNOLOGY, CONSUMERS, AND MARKETING THEORY
The instrumentalist–functionalist views of
ICTs in marketing are not particularly well
suited when the focus is on marketing as a
system of provision and consumption as a mode
of collaboration, social innovation, and peer
production (Arvidsson, 2008; Surowiecki,
2004). In our view, then, the dominant dis-
courses in the discipline that have tradition-
ally provided the basis for understanding the
relationship between marketing and technol-
ogy have not been able to reveal the changed
conditions of the cultural and technological
‘production of marketing’ as a customer
relationship technique (for a critical discus-
sion, see Zwick et al., 2008; Zwick and
Dholakia, 2004a). In particular, the majority
in the marketing academy still holds on to
the traditional view that consumers aspire
to maximize the consumption of material
goods (even as these goods contain more
‘knowledge’ and eventually become a serv-
ice, as argued by Vargo and Lusch [2004])
and that ICTs merely facilitate this mode of
consumption as material accumulation.
This view has been suspect for a while
now (Baudrillard, 1981, 1988; Firat and
Venkatesh, 1995) and recently become almost
absurd, especially in the affluent world where
consumers chase symbols, recognition, infor-
mation, and what Li and Bernhoff (2008) call
psychic income, rather than ‘stuff’ (Arvidsson,
2008; Bauman, 2008). More to the point,
though, the traditional view of marketing
insists that production and consumption are
two separate, indeed opposed, facets of the
exchange coin3, yet what marketing practi-
tioners and theorists are beginning to recog-
nize is that with the advent of socially
networked ICTs entirely new and uncertain
arenas of mass collaboration, innovation,
creativity, and play have opened up
(Molesworth and Denegri-Knott, 2008),
which collectively have the potential to trans-
form current processes of value creation and
in the process, redraw the contours of con-
temporary capitalism.
From the vantage point of many companies,
value creation depends increasingly on the
work of dispersed, external, and often unpaid
5339-Maclaran-Chap 28.indd 501
501
human resources. Hence, the challenge for
marketing is quickly becoming one of pro-
viding technology-enabled platforms and
ambiences that channel the productive work
of these individuals (often the company’s
consumers) into a productive, valuable direc-
tion (Arvidsson, 2006; Lury, 2004). In mar-
keting and management thought, recently
popularized notions such as value co-creation
(Prahalad and Ramaswamy, 2000, 2002,
2004a, 2004b) and the concept of a service-
dominant logic of marketing (Lusch and
Vargo, 2006; Vargo and Lusch, 2004) may be
able to provide formal theoretical founda-
tions from which a theory of information
technology and marketing could emerge,
since both contain in principle the idea that
the generation of customer value depends on
providing sophisticated managed and inter-
active platforms for consumer participation
(Zwick et al., 2008).
THEORIES OF CONSUMPTION IN
THE AGE OF TECHNOLOGY
ICTs have a quixotic duality: information
overpowers, and yet it empowers. Even as its
volume explodes, information empowers con-
sumers in markets for goods, services, experi-
ences, and ideas. Tools that summon, gather,
summarize, and arrange information for the
purpose of consumption are getting better,
i.e., more easily consumable. People, includ-
ing consumers and marketers, have access to
‘meta-textual means by which information on
a topic can be filtered, collected, and presented
for consumption’ (Cohen and Rutsky, 2005:
2). One of the significant implications, then, of
the rise of ICTs and the concomitant produc-
tion, reproduction, distribution, and endless
consumption of information is that it has
become almost impossible to distinguish
between the consumption of information and
the acquisition of knowledge. In other words,
a culture increasingly permeated and dif-
fused by ICTs gives birth to situations where
every interaction with information (and data)
9/1/2009 12:15:01 PM
 502 THE SAGE HANDBOOK OF MARKETING THEORY
is as much a type of consumption as is the
purchasing of a product. As ICTs continue to
diffuse throughout social, cultural, and eco-
nomic institutions, the ‘informational reach
of marketing’ (Arvidsson, 2005: 42), driven
by advanced market research techniques,
new communication techniques, information
distribution channels, and data collection,
storage, and mining capabilities has expanded
in ways unimaginable even in the 1980s
(Poster, 1995; Zwick and Dholakia, 2004b).
TECHNOLOGY AS SHAPER OF
MARKETING THEORY
In a technology suffused world, where technol-
ogy is no longer an instrumental device that
aids the processes of marketing but is instead
an envelope that surrounds commerce and
consumption (as well as an ingredient that
saturates these fields), it is not surprising that
technology has become a major influence
on theories of marketing and consumption.
In this section, we examine several ways in
which contemporary marketing theory is being
shaped by technology.
Customer relationships
Customer relationship management is
increasingly taking center stage in organiza-
tions’ corporate strategies (Greenberg, 2002;
Swift, 2001). CRM, closely related to notions
of relationship and database marketing,
aims at creating, developing, and enhancing
personal and valuable relationships with
customers by providing personalized and
customized products and services (McKim,
2002; Rigby et al., 2002). For it to work, a
CRM system relies on its ability to identify
and interpret individual customer records.
Underlying organizational CRM systems are
massive customer databases. Fueled by the
steady and steep decline in the cost of data
storage and handling over the past thirty
years, organizations invested in creating
5339-Maclaran-Chap 28.indd 502
increasingly detailed profiles of their custom-
ers and non-customers, despite the fact that
such information is not necessary for billing
and service-delivery purposes. From book-
stores to supermarkets to large chemical man-
ufacturers, organizations make efforts to
bestow individual customers with a unique and
graspable identity (Fayyad and Uthurusamy,
2002; Roberts, 1999). Information technolo-
gies such as the customer database represent
a powerful response to the fast-changing
tastes and fluid identities of the postmodern
consumer elites (Featherstone, 1991). By cap-
turing consumer actions and activities in ubiq-
uitous fashion and minute detail, databases
become repositories of complex consumer
lives by turning behavior into abstract aggre-
gates of individualized and individualizing
data points. Once consumption has been
dematerialized and made available as coded,
standardized, and malleable data, there are
no more limits to the construction of differ-
ence, to classification, and to social sorting
(Lyon, 2001).
A good example of how technology affects
marketing practice and theory is presented by
the emergence and proliferation of the cus-
tomer database, a technology that has given
rise to techniques, competences, expert sys-
tems, and productive units aiming not only at
the supervision, administration, and simula-
tion of consumption but also at the flexible
production of customers as information com-
modities (Zwick and Denegri-Knott, forth-
coming). In other words, the reterritorialization
and recoding of decoded and deterritorialized
flows of customer information – resulting in
customer profiles that potentially contain, for
each individual, thousands of transactional
data points in addition to detailed demo-
graphic, psychographic, and geographic
information – is not merely a matter of
understanding consumer preferences and
behaviors to configure flexible and efficient,
global production systems. Rather, the mas-
sively combinatorial capabilities of the data-
base allow for the restructuring of the gaze of
marketers who recognize that new instruments
of knowledge also contain the possibility for
9/1/2009 12:15:01 PM
 TECHNOLOGY, CONSUMERS, AND MARKETING THEORY
new forms of production, value creation, and
profitability.
Reducing the effects of panoptic tech-
niques to improvements in consumer disci-
pline and control (typically expressed as
improved market segmentation and targeting
capabilities, customization, one-on-one rela-
tionships, interactivity, etc.) ignores the eco-
nomic innovations brought about by the
integration of database technology into exist-
ing informational modes of production. We
argue that the constant and compounding
growth in the volume of data coupled with
rising analytical powers of computers has
endowed the customer database with an
immediate strategic importance in a compa-
ny’s economic value creation process. In
short, because of the massive informatization
of consumers, it is now more efficient (faster,
more flexible, and cheaper) to manufacture
customers as modular configurations of pro-
pensities, as calculations of possible future
values, and as purified groupings of selective
homogeneity. Customer classifications are
becoming real-time modulations. Put differ-
ently, in the age of information capitalism we
need to conceive of customer databases as the
factories of the twenty-first century.
Customer centricity and co-creation
In an era where information has come to
dominate value creation, the separation of
production and consumption has become
blurred. Manipulation and reproduction of
information by consumers increasingly drives
the conversion of information into market-
exchangeable value. Marketers increasingly
provide – for a price – the conditions of
production by customers. In such settings,
notions of market systems come into produc-
tive confrontation with analyses of informa-
tion and communication technologies. ICTs,
on the one hand, transform marketing prac-
tices; and on the other hand, represent them-
selves as active forces of social, cultural, and
economic transformation. In other words,
ICTs are reshaping the meanings, metaphors,
5339-Maclaran-Chap 28.indd 503
503
and practices of marketing even as they con-
tinue to mold and refine the methods and
techniques of managing a firm’s customer
relationships.
Value co-creation is the latest of what seems
to be a continuous flow of popular manage-
ment techniques (Ritzer, 1993, 1998). The
term was coined by C.K. Prahalad, director
of the ‘Center for Experience Co-Creation’
at the University of Michigan, and describes
a situation in which market exchanges are
the result of collaborative consumers and
marketers creating innovative experiences
together. In such collaborative arrangements,
the distinction between marketing and
buying, production, and consumption col-
lapses and makes way for the hybridization
of consumption and production activities
turning consumers into active actors of the
marketing process. From this perspective, the
market democratizes the extraction of value as
consumers are promoted to be creative par-
ticipants in the production process. Consumer
involvement is undeniable during the use of
automated teller machine, the gas pump, and
the supermarket checkout, for example, but
such instances do not provide true co-creation
moments, because ‘the firm is still in charge
of the overall orchestration of the experience’
(Prahalad and Ramaswamy, 2004: 8). Here, as
in what Ritzer (1998) labels McDonaldization,
the involvement of the customer is structured
by the firm to suit the demands of its supply
chain ‘rather than fulfill a customer’s unique
desires and preferences’.
A parallel to Prahalad and Ramaswamy’s
value co-creation concept is offered in the
marketing domain by scholars Stephen Vargo
and Robert Lusch (2004 and Chapter 12 in
this volume) who suggest that the discipline’s
progression from a concern with the efficient
production and distribution of goods to what
they believe to be a necessary preoccupation
with devising, marketing, and delivering
services. The authors explain that goods are
not what companies really end up with for the
exchange process. Rather, the commodities
that companies produce for sale are no more
than ‘intermediate ‘products’’ that consumers
9/1/2009 12:15:01 PM
 504 THE SAGE HANDBOOK OF MARKETING THEORY
use as ‘appliances in value-creation processes’
(Vargo and Lusch, 2004: 7). This notion of the
commodity as a resource echoes Prahalad and
Ramaswamy’s idea of the commodity as value
proposition. The significance of this reframing
of commodities as services lies in the role
reserved for the consumer in this plot. The
way marketing theorists distinguish services
from goods has a lot to do with the consumer’s
participation level during the service produc-
tion process. In other words, the successful
production and commodification of a service
requires the active participation of the con-
sumer, while that of goods does not. Therefore,
if everything – including goods – becomes
a service then the consumer becomes enlisted
as a permanent member of the company’s
production and marketing project.
From a marketing theoretical perspective,
then, co-creation strategies are no longer
designed to control demand in the traditional
way by first scrutinizing and then satisfying
customer needs. Rather, the idea is for mar-
keting to position itself as a mere facilitator
and partner of consumer ingenuity and
agency, letting individuals find their own
places for playful production in their own
consumption experiences, as demonstrated by
the popularity of many gaming, open-source
hacker, and fan communities (e.g., Dyer-
Witheford, 2003; Kline et al., 2003; Kozinets,
2001). It is this productive fervor of the
common, to use Hardt and Negri’s (2000)
term, that creates meanings, commodities,
and experiences corporations are unable to
(re)produce within their own rationalized
systems of production. On the lookout for
new ideas, marketers must seek ways to
appropriate, control, and valorize the creativ-
ity of the common and the co-creation con-
cept describes such an approach to marketing.
Co-creation affords companies at least two
crucial forms of payback: competitive advan-
tage in a consumer culture characterized by
fast-changing and fragmented demand
(Gabriel and Lang, 1995; Turow, 2000) and a
new modular form of control (Deleuze, 1986,
1992a, 1992b) that is well suited for manag-
ing the productivity of a virtually free and
autonomous consumer workforce, dispersed
5339-Maclaran-Chap 28.indd 504
throughout cyberspace and connected only by
a common (and often momentary) desire to
collaborate (cf. Arvidsson, 2005). Co-creation
then, has become a dominant form of produc-
tion with the advent of open source models
and mass collaboration platforms where con-
sumers can join forces and function as an
extension of an organization’s workforce
(Benkler, 2006; Kozinets et al., 2008; Tapscott
and Williams, 2006).
Playful and experiential
consumptionscapes
For decades, technologies have aided in the
creation of experiential spaces that enchant
consumers, at least temporarily (Firat and
Dholakia, 1998, Firat and Vicdan, 2008).
Until the dawn of the twenty-first century,
such experiential spaces were anchored in
physical places – consumers had to be
transported to such places to partake of the
available consumption experiences (Ulusoy
and Firat, 2009). ICTs have untethered expe-
riential spaces from physical, locational
anchors (Firat and Vicdan, 2008). Based on a
study of eBay and extending their analysis to
electronic social networking spaces in gen-
eral, we argue that the key task for marketing
is to consider its role in the creation and
maintenance of play. Experiential marketing
denies routine, consistency, and possibly even
permanence. It could well be that for a sector
of the market – that part that is at the leading
trajectory of experiential consumption – there
is a requirement not just for built in obso-
lesces in products but in business models and
businesses themselves such that the inevitable
transience of any game created is recognized.
Yet marketers must do this in a way that does
not accelerate what Barber (2007) calls infan-
tilization, the regression of the consumer to a
childlike state of relative suspension of reason
due to aggressive and pervasive marketing
assaults. EBay, Facebook, and Second Life
produce new games and therefore pleasures
for consumers, but they may still be criticized
as superficial in the context of Barber’s global
political concerns. Yet, the answer is not to
9/1/2009 12:15:01 PM
 TECHNOLOGY, CONSUMERS, AND MARKETING THEORY
prevent play but rather to align engaging
consumer play with the creation of meaning-
ful community, responsible social sensitivities,
and tolerance for the other in a lifeworld
characterized by difference. An answer to
Barber’s complaints may therefore be for
marketing to attempt to re-focus the types of
game that consumers enjoy.
The removal from the physical and material
coupled with the hyper-realism and engage-
ment afforded by digital technology produce
fantastic, out of the ordinary consumer expe-
riences not possible in other consumer theat-
ers (Molesworth and Denegri-Knott, 2004,
2007). Put differently, websites, virtual
worlds, videogames, as liminal or intermedi-
ary spaces, have the potential to actualize
consumer fantasy beyond what was previ-
ously probable even in the elaborate experi-
ential economy of developed cities with
their exotic malls and tourist locations
(Featherstone, 1998). Consumers can custom-
ize and drive unaffordable cars in websites
and video games, build palatial homes for
their avatars in Second Life, become budding
sellers on eBay, purchase designer clothing
for their Neo-pets and improve their digital
lives with rare and expensive magic artifacts
in videogames like Everquest, or World of
Warcraft. Such experiences stretch the theo-
retical straightjacket of ‘Classical’ theories
of consumption that reduce consumption to
the satisfaction rational needs or economic
utility (Baurdillard, 1998; Campbell, 1987;
Firat and Dholakia’s explanation, 1998).
Fundamentally, consumer experiences in a
digitized arena, which are deprived of a physi-
cal container, are best described as playful
since they feed from a consumer imagination
seeking thrill and excitement and not mere
economic exchange. The salient characteris-
tics of such consumer practices are akin to
what has been observed in the sociology of
play (Caillois, 1958) – competition, chance,
role playing and thrill. Consumers compete
in online auction sites for desired goods
and for popularity in social networking sites
like Facebook as well as for status in online
communities and user-generation sites like
YouTube. Chance is delved by online auction
5339-Maclaran-Chap 28.indd 505
505
houses, which endlessly tease consumers
with the chance that a desired good may be
had, for example, eBay with over 115 million
new listing at any one day, offers endless
possibilities of the rare and the exotic. The
potential for role play is vast – from identity
experimentation in online communities,
transformation in role and status, from con-
sumer seller or broadcaster in auction sites
and user-generated websites, to otherworldly
performances as knights and car thieves in
videogames (Molesworth and Denegri-Knott,
2004, 2007).
We can see such consumer excursions as the
latest development toward the dematerializa-
tion of consumption in favor of its playful
properties. Such a reading acknowledges the
historical trajectory that produced such pos-
sibilities, namely the transition from Fordism
to post-Fordism. This has been explained
elsewhere in terms of a departure from
Fordism and its focus on commodity accu-
mulation, to consumption forms that end-
lessly produce novel experiences (Campbell,
1987; Featherstone, 1991; Lee, 1993; Slater,
1997). Consumers’ desire for the new and out
of the ordinary has been met with the devel-
opment of novel business models aiming to
profit from consumers’ playful behavior.
However, the imperative of businesses to
maximize profits through increased regula-
tion and professionalization of play produces
the very conditions of apathy and boredom
(Shankar et al., 2006), that consumers’ sought
escape from. Therefore, based on the study
of virtual consumption spaces such as eBay
and Second Life, we would suggest that
reproduction of consumption as meaningful
play may emerge as the chief narrative of
consumer culture in the twenty-first century.
Marketing at crossroads: consumer
serving, capital supporting
With evolving socially networking and glo-
bally connecting ICTs, marketing processes
and consumption practices are at a crossroads.
The social prospects of fully empowered
co-creating consumers are exciting but often
9/1/2009 12:15:01 PM
 506 THE SAGE HANDBOOK OF MARKETING THEORY
come into conflict with the private needs of
enterprise capital accumulation.
Many new information technologies seem to
open new windows into potential democrati-
zation of consumption space. At the same
time, other technologies enter the fields of
production and consumption that offer ever-
greater panoptic power to the marketers. The
technologies of rebellious democratization
seem to get co-opted quickly into corporate
marketing and brand promotion programs.
The idea of managing one’s life without
technology is disappearing. Even in the devel-
oping world, basic technologies such as mobile
telecommunications and the Internet are
making rapid inroads among the poor and
disadvantaged social segments – and some
technology firms are taking major steps to con-
nect the billions who are still not connected.4
This makes it imperative to keep exploring the
apertures and actions where consumers seem
to take charge, with the aid of technology.
While capital resources would remain concen-
trated with global corporations that would at
best number in the thousands, the proliferation
of connectivity – in ways that reach a vast
majority of the nearly seven billion people on
the planet – could create a tipping point.
Capital resources favor the well-financed
brand marketers but global democratic access
to basic electronic connectivity has the poten-
tial to create so much in terms of diverse
content that the tsunami of user-generated con-
sumptive options could wash over branded
consumptive options in some cases. These
types of consumer-led actions, in diverse global
settings, need to come increasingly on the
research radar screens of those working in the
fields of marketing and consumption studies.
CONCLUDING OBSERVATIONS
Technology has shaped marketing practice and
consumer behavior historically. Especially
with the emergence of new connective infor-
mation technologies and intensive technology-
suffused lifeworlds, technology had become
5339-Maclaran-Chap 28.indd 506
interwoven with marketing strategy and con-
sumption processes in inextricable ways.
Tearing away technology from marketing
and consumption would indeed tear apart the
very fabric of contemporary commerce and
daily life. In this chapter, we examined the
distinctive core conceptual elements and
main characteristics of new information tech-
nologies and why new information technolo-
gies are often creating impacts that are not
merely accretive and accelerative but radical
and transformational. The recent passage from
an industrial to an informational economy
involves dramatic changes in the theoretical
and practical elements of marketing the most
salient of which is the collapse of the tradi-
tional structure of communication between
production and consumption – the funda-
mental domain of the marketing function in
business. In other words, the flexibility of new
ICTs deployed on both sides of the market
exchange equation entails not simply a more
rapid feedback loop between production and
consumption to the point where production
comes after (in reaction to) a market decision
the Dell model universalized). Flexibility of
technology means that consumption and pro-
duction are becoming indistinguishable from
one another as general consumer activities
become ever more a direct force of produc-
tion. Therefore, in the age of advanced infor-
mation and communication technologies, we
see the role of marketing in providing a plat-
form to consumers to exchange services,
share knowledge, generate communication,
and build community. Marketers that find
ways to harness and profit from the produc-
tive activities of consumers will thrive in the
high-tech marketplace.
NOTES
1 ‘The Last Spike’, Available at: http://www.nps.
gov/archive/gosp/history/spike.html, accessed 18
February, 2008.
2 We employ the terms ‘technology’, ‘high technol-
ogy’, ‘new technology’, and ‘new information tech-
nology’ interchangeably when referring to information
9/1/2009 12:15:01 PM
 TECHNOLOGY, CONSUMERS, AND MARKETING THEORY
and communication technologies from the 1990s
onwards.
3 This stance has only been remedied partly by the
recent discussion on the service–-dominant logic
(see, e.g., Aitken et al., 2006).
4 An organization called O3b – funded by Google,
Liberty Global, and HSBC – plans to employ satellite
technology to connect ‘the other 3 billion’, those in
the developing world with no Internet connectivity.
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