Stephen L. Vargo & Robert F. Lusch

Stephen L. Vargo & Robert F. Lusch

Evolving to a New Dominant Logic for Marketing
Marketing inherited a model of exchange from economics, which had a dominant logic based on the exchange of “goods,” which usually are manufactured output. The dominant logic focused on tangible resources, embedded value, and transactions. Over the past several decades, new perspectives have emerged that have a revised logic focused on intangible resources, the cocreation of value, and relationships. The authors believe that the new perspectives are converging to form a new dominant logic for marketing, one in which service provision rather than goods is fundamental to economic exchange. The authors explore this evolving logic and the corresponding shift in perspective for marketing scholars, marketing practitioners, and marketing educators.

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he formal study of marketing focused at first on the distribution and exchange of commodities and manufactured products and featured a foundation in economics (Marshall 1927; Shaw 1912; Smith 1904). The first marketing scholars directed their attention toward commodities exchange (Copeland 1920), the marketing institutions that made goods available and arranged for possession (Nystrom 1915; Weld 1916), and the functions that needed to be performed to facilitate the exchange of goods through marketing institutions (Cherington 1920; Weld 1917). By the early 1950s, the functional school began to morph into the marketing management school, which was characterized by a decision-making approach to managing the marketing functions and an overarching focus on the customer (Drucker 1954; Levitt 1960; McKitterick 1957). McCarthy (1960) and Kotler (1967) characterized marketing as a decision-making activity directed at satisfying the customer at a profit by targeting a market and then making optimal decisions on the marketing mix, or the “4 P’s.” The fundamental foundation and the tie to the standard economic model continued to be strong. The

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