MKTG 556 | Session 3 | Marketing Excellence: Nature, Measurement, and Investor Valuations

MKTG 556 | Session 3 | Marketing Excellence: Nature, Measurement, and Investor Valuations - 2020 Christian Homburg, Marcus Theel, and Sebastian Hohenberg Introduction: Marketing excellence is a core principle in the field that is gaining more attention from managers and investors. However, the exact nature of marketing excellence and its effectiveness still remain unclear. This research provides insights by addressing two questions: (1) How do managers understand and practice marketing excellence? and (2) How do investors assess marketing excellence? Study 1 combines insights from 39 in-depth interviews with senior executives and secondary data from 150 company strategies to find that marketing excellence is a strategy focused on achieving organic growth by prioritizing aspects related to the marketing ecosystem, end users, and marketing agility. Study 2 measures the impact of marketing excellence on company value using a machine learning algorithm and text analysis with an original dictionary to classify 8,317 letters to shareholders in 1,727 U.S. firm annual reports. Calendar-time portfolio models show abnormal one-year returns of up to 8.58% for marketing excellence—returns that surpass those linked to market orientation and marketing capabilities. These findings guide managers, educators, and investors on how marketing excellence appears, paving the way for better resource allocation to ensure marketing drives organic growth.