Direction-Setting in Stakeholder Management: A Marketing Strategy Approach: An Abstract

This paper explores how the application of standard marketing processes and tools could create clearer strategic direction for stakeholder management. While this approach has been encouraged by many ever since Philip Kotler and Sidney Levy proposed “broadening marketing” to “publics” other than customers (Kotler and Levy 1969), it has never been explored systematically. This lack of response comes despite repeated requests by leading marketing academics for more conceptual studies that provide guidance as to how to coordinate marketing plans across business functions (Kumar 2015). It also comes despite the relative prominence among academics and practitioners of the stakeholder concept, which counts the customer as just one of many potential stakeholder categories. Despite stakeholder theory’s success, it also suffers from some fundamental weaknesses that leave it a challenged concept (Miles 2017) and in need of additional insights that it seems the marketing discipline could provide.

The article begins with a critical review of the stakeholder theory and stakeholder marketing literature as it applies to the direction-setting stage of the strategic planning process. The direction-setting phase involves stakeholder identification, values analysis, and salience determination. The literature within stakeholder theory in each of these areas is extensive, but, as this and other reviews have noted, there remains considerable debate over the definitions and prescriptions in each step.

Subsequently, the article describes how common, “generic” marketing planning steps (Kotler 1972; Kotler and Keller 2012) that involve targeting customers and positioning offerings affect the prioritization of and promises to one particular stakeholder, the customer. It then shows how these customer-oriented decisions indirectly determine who the non-customer stakeholders are, which of their values are met, and their relative salience. Furthermore, it explains how the processes and analytic tools commonly used in marketing for customer management can and are used directly by other business functions to manage the stakeholders for which they are primarily responsible (e.g., human resources for employee acquisition and retention). Lastly, it argues that the marketing planning process provides a natural mechanism for cross-stakeholder management.

The article concludes that tighter integration of stakeholder theory with common marketing planning concepts, processes, and tools would strengthen both stakeholder theory and the marketing discipline. For stakeholder theory and management, the marketing planning process offers a means to better define and prioritize promises, offerings, and communications across all stakeholders. For the marketing discipline, embracing the stakeholder paradigm more fully provides a framework to move beyond its customer-obsessed myopia (Smith et al. 2010) to a more holistic, stakeholder marketing approach.