MKTG 601- Assignment 1

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Feb 20, 2024

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Samantha Coomer 2024 January 10 MKTG 601- Marketing Strategies Professor Sabinah Wanjugu Writing Assignment 1 1. Theory of the firm: A. First, identify and clearly explain any one of the theories of the firm that are mentioned in the “Theory of the Firm” section of the assigned reading, “Developing a Customer Value-Based Theory of the Firm.” ( be sure to identify the specific theory you are explaining ). Theory: - The neoclassical theory of the firm Explanation: - The neoclassical theory of the firm can be presumptively explained as a company having the right information necessary to meet the firms profit maximization. This is done so by setting the firms price and quantity to maximize profits that are subject to the market demand. By combining the substantial information and adequate resources the firm is able to determine their highest value use. Consumer demand will allow the markets to naturally adjust enabling marginal costs to equal marginal revenues (Slater, 1997). The primary emphasis of the neoclassical theory is accumulated supply and although the company’s intent is to maximize profits, the individual’s purpose is to maximize utility. B. Second, describe at least two specific ways a customer value-based theory of the firm would differ from the theory you explain in part (a).

Difference 1: - A customer value-based theory of the firm cornerstones on the value that a customer receives from a company that ultimately exists to provide value to a company. Whereas the neoclassical theory centers in on the profit maximization objective of the firms and the maximization of products but while also reducing operational costs. Difference 2: - A customer value-based theory of the firm continuously seeks to attain new information on their customer base and what will also hold interest of other potential stakeholders. Whereas the neoclassical theory focuses on the consumers distinctive view of a product that gives its value. The company will also only enter in new markets if they will achieve a maximize of profits and only seek information that will involve lowering costs in order to maximize profits. 2. Customer Centricity: Select one of the ways the required reading, “Customer Centricity in the Digital Age”, says that artificial intelligence (AI) is helping retailers put the customer at the center of their strategy (it identifies 3 ways, just select 1). Then, describe an example of how the company you work for (or one you want to work for) is using or could be using AI in a similar way to keep customers at the center of its strategy. In your example, clearly communicate (a) the strategic benefit for the company in using AI in this way and (b) how using AI in this way helps focus the company’s strategy (or at least part of its strategy) on customers. Way selected : - AI helps create a more seamless shopping experience. A detailed description of your answer that clearly communicates: - (a) the strategic benefit for the company in using AI in this way

(b) how using AI in this way helps focus the company’s strategy (or at least part of its strategy) on customers: In regards to AI and its impact in healthcare, there are numerous benefits. However, in terms of AI creating a seamless shopping experience in a metaphorical sense to healthcare the simplest response is that it uses the AI-driven technology and data collection to enhance diagnosis and increase patient outcomes and experiences. With the assistance of AI utilizing resources, the experience for consumers (patients, doctors, stakeholders, etc.) becomes “seamless.” There is a reduction in costs for both patients and providers, as well as increased patient engagement. By using AI in this way, the company is able to analyze data much quicker and prioritize vital resources elsewhere to help medical professionals adequately in more routine tasks such as data entry. 3. Virtue Matrix: A. Examining Strategic Actions in the Frontier : Describe what is meant by acting in the strategic portion of the frontier and provide one example of an organization taking actions that represent the strategic quadrant of the Frontier portion of the Virtue Matrix. Explain your answer from the perspective of the Virtue Matrix framework. Be sure to provide specific information about your example that supports your conclusion about its actions. Description : - By acting in the strategic portion of the frontier means to identify and evaluate strategic actions of an organization with sustainable and ethical impact. This portion of the frontier acts in a way that is focused on the long-term view of the organization and is useful as a tool to assess an organizations actions in relation to their mission and values practiced. This tool relates to the Virtue Matrix framework in this sense.

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Organization example and detailed explanation to support your answer : - An example of an organization taking action that represents the strategic quadrant of the frontier portion of the Virtue Matrix is HealthQuest providing an investment at Duke University for cancer research at their med school. This investment is an example of acting in the strategic portion of the frontier as it is focused on long-term goals of the organization (Duke university in this example) in order to achieve a pivotal mark in cancer research. HealthQuest strives with a commitment to cancer research that aligns with their mission and core values of their organization. This long-term view and goals hold an impact on their organization, therefore representing a strategic quadrant of the frontier portion of the Virtue Matrix framework. B. Examining Structural Actions in the Frontier : Describe what is meant by acting in the structural portion of the frontier and present one example of an organization participating in actions that represent the structural quadrant of the Frontier portion of the Virtue Matrix. Explain your answer from the perspective of the Virtua Matrix framework. Be sure to provide specific information about your example that supports your conclusion about its actions. Description : - By acting in the structural portion of the frontier means to be both intrinsically motivated and contrary to the beliefs and interests of shareholders. Collective action and corporate conduct are more susceptible towards society instead of corporations. Laws and regulations and compliance are more binding in the structural frontier. Organization example and detailed explanation to support your answer : - An example of an organization taking action that represents the structural quadrant of the frontier portion of the Virtue Matrix is Kroger supporting their employees after the

detrimental tornado that wiped out homes for dozens in the community. Many employees were affected by this disaster and were out of a place to live, groceries, a vehicle for transportation, etc. Kroger provided these employees with funds to stay in a hotel and a gift card for groceries while they were undergoing this traumatic hardship. This left the company short staffed for an extended time and was difficult functioning with fewer employees for a while, however it provided their employees that were affected with a place to stay while they underwent the process of awaiting checks from insurance and crisis support. This act is not of the norm of most corporate chain organizations. Reference: Slater, S. F. (1997). Developing a Customer Value-Based Theory of the Firm. Retrieved from Journal of the Academy of Marketing Science.

MKTG 601- Assignment 1

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