The impact of crisis on marketing strategy components - an overview of empirical evidence

Marasović, Ivana and Crnjak Karanović, Biljana and Dragnić, Daša (2012) The impact of crisis on marketing strategy components - an overview of empirical evidence. In: Marketing challenges in new economy. Sveučilište Jurja Dobrile u Puli. ISBN 978-953-7498-57-3

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Companies operate in turbulent and often adverse environment which endangers not only their growth but also their survival. The situation is additionally aggravated with the onset of crisis that increases risks. Crisis is an economic disruption (recession or depression) which in precapitalist societies was manifested as the crisis of insufficient production (means of living scarcity due to natural disasters and other similar causes), while in the capitalist economy it is manifested as the crisis of excessive production, or hyperproduction. In marketing literature crisis is defined as the process of decline in demand for raw materials, materials, products and services, including labour (Shama, 1978) or as a situation in which the demand for products is lower than in normal conditions (Kotler, 1973). According to the Dictionary of Marketing (Rocco, 1993) economic crisis is accompanied by massive disparity between supply and demand, price and capital value depreciation, sudden decline in production, liquidation and termination of companies, dramatic rise of unemployment and other similar consequences. Although there are records of crises in the 17th and 18th century, economics started to study crises in 1820, after the first crisis of modern economy ensuing after the Napoleonic Wars (Baletić, 2009). With the onset of the Great Crisis (1929-1933) the interest in studying crises has intensified, to be reduced during the sixties due to the beliefs that crises cannot be repeated because modern countries developed preventive and intervening stabilization mechanisms. All the great crises, regardless of their causes, have a negative effect on various aspects of human life and on economic activities, which is most frequently reflected in the decline of GDP, investments, demand, and employment. The impact of crisis expands over political-economic regions globally but in different ways depending on the regional economic structure, depth of financial markets, source of exposure to risk, intensity and structure of international exchange, character of financial transfers and modes of financial exposure (Buturac, Rajh, Teodorović, 2009). The researches indicate the differences in intensity of how crisis impacts upon companies as well as in how companies respond to the crises with regard to the type of crisis, country’s political and cultural determinants, market characteristics and range, respective industry and the company’s size (Ang, 2001; Shama, 1993). The basic guidelines for a successful survival of crisis provided in literature are: focusing on core business, networking and alliances, speed and flexibility, planning, cost reduction, but at the same time retaining/increasing marketing investment, especially in research and development (R&D) and promotion (Trade & Enterprise New Zealand, 2008; Roberts, 2003; Ang, Leong and Kotler, 2000; Laitinen, 2000; McCallum, 1991). Namely, marketing planning and budget proved significant positive correlation to company performance in the period of crisis, measured by net profits, turnover and market share (Koksal and Ozgul, 2007). Proactive action, which involves an offensive reaction to crisis, has also proved as very effective in the period of crisis (Srinivasan et al., 2005; McCallum, 1991). Companies that perceive crisis as a threat feel that they have no control over the situation or business results, while eventually they react in a passive, defensive and restrictive way. On the other hand, companies that perceive crisis as an opportunity, feel that they have control over the situation and their performance and therefore make additional investments at the time of crisis.

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Tip objekta:	Dio knjige
Mentor:	NIJE ODREĐENO
Dodatne informacije:	e-book
Teme:	3 Društvene znanosti > 33 Ekonomija. Ekonomska znanost > 339 Trgovina. Međunarodni gospodarski odnosi. Svjetsko gospodarstvo > 339.1 Opća pitanja trgovine. Tržište > 339.138 Marketing
Odjeli:	Odjel za ekonomiju i turizam "Dr. Mijo Mirković"
Datum pohrane:	04 Jul 2013 06:21
Zadnja promjena:	04 Jul 2013 06:21
URI:	http://eknjiznica.unipu.hr/id/eprint/2232

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