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Accountability and sustainability: evaluation of
corporate practices
Vesna Žabkar, Ph.D.
ToSEE, May 14, 2015
Definition of (marketing) accountability
American Marketing Association (2005, p. 1):
“The responsibility for the systematic management of marketing resources and processes to achieve measurable gains in return on marketing investment and increased marketing efficiency, while maintaining quality and increasing the value of the corporation”.
Defining sustainability
Ability for long-term maintenance (environmental, social equity and economic demands - the 3 Es).
‘the consumption of goods and services that meet basic needs and quality of life without jeopardizing the needs of future generations’ (OECD, 2002).
Market capacity & resource capacity problem
From activities to performance
ORGANIZATIONS’ EXTERNAL
ACTIONS (“what they do”)
PERCEPTUAL/ UNOBSERVABLE
MEASURES (“what customers
thnk”)
BEHAVIORAL OUTCOMES/
OBSERVABLE MEASURES
(“what customers do”)
FINANCIAL PERFORMANCE
of the organization
(“what they get”)
Source: Gupta, S. and V. Zeithaml (2006). "Customer Metrics and Their Impact on Financial Performance." Marketing Science 25(6): 718.
From activities to performance
ORGANIZATIONS’ EXTERNAL
ACTIONS (“what they do”)
PERCEPTUAL/ UNOBSERVABLE
MEASURES (“what customers
think”)
BEHAVIORAL OUTCOMES/
OBSERVABLE MEASURES
(“what customers do”)
FINANCIAL PERFORMANCE
of the organization
(“what they get”)
Source: Gupta, S. and V. Zeithaml (2006). "Customer Metrics and Their Impact on Financial Performance." Marketing Science 25(6): 718.
From activities to performance
ORGANIZATIONS’ EXTERNAL ACTIONS (“what they do”)
PERCEPTUAL/ UNOBSERVABLE MEASURES
(“what customers think”)
BEHAVIORAL OUTCOMES/ OBSERVABLE MEASURES
(“what customers do”)
FINANCIAL PERFORMANCE of the organization (“what they
get”)
Source: Gupta, S. and V. Zeithaml (2006). "Customer Metrics and Their Impact on Financial Performance." Marketing Science 25(6): 718.
From activities to performance
ORGANIZATIONS’ EXTERNAL ACTIONS (“what they do”)
PERCEPTUAL/ UNOBSERVABLE MEASURES
(“what customers think”)
BEHAVIORAL OUTCOMES/ OBSERVABLE MEASURES
(“what customers do”)
FINANCIAL PERFORMANCE of the organization (“what they
get”)
Source: Gupta, S. and V. Zeithaml (2006). "Customer Metrics and Their Impact on Financial Performance." Marketing Science 25(6): 718.
Customer impact
1. Customer awareness
2. Customer associations
3. Customer attitudes
4. Customer attachment
5. Customer experience
Sustainability as marketing’s superphenomena
“Sustainability has been creeping up on Eric Fromm’s homo consumens for a long time (Kotler 2011). Marketing has well-known negative impacts.
It encourages rapid consumption of limited natural resources,
it does not restrain the wants it encourages, and
it over-fulfills materialistic wants and under-serves nonmaterial wants”
Source: Achroll, Kotler, 2012
Business side of sustainability
Market for sustainability
Increased profits
Reduced employee turnover
Improved productivity
Generating competitive advantage
Accessing capital
Better brand recognition and loyalty
The new horizon for management
Accountability & sustainability
Customer care with long-term
interests
Cost accounting featuring nature
costing
Decision calculus with commitment to managerial values
Customer care with long-term interests
(1) Proactively communicating the harmful side-effects of wasteful consumption
(2) growing segments of environmentally conscious consumers
(3) demarketing/countermarket ing certain products, technologies
