Decoding the XXI Century's Marketing Shift: An Agency Theory Framework

Since the beginning of the XXI century, marketing theory has moved through a series of epistemological shifts from modern positivism to postmodern constructivism. This has resulted in a series of changes to the main concepts of “traditional” marketing such as: market, product, customer, and value. These shifts can be better viewed under a social cybernetics approach such as agency theory. This is because there is now a view that the linear concept of value creation needs to give way to the more complex process of value cocreation, where value is created collectively. Agency theory is one approach that is able to shed light on how customers and providers are able to recursively create collective value during interaction in a market. The theoretical framework provided here is able to provide improved understanding of the interactions betfween (and among) customers and providers in the value cocreation process. In this theory, value cocreation is depicted as an interactive process between a set of “living system” agencies (providers and customers) in a given market arena. The framework can be an effective tool for the managers involved in marketing to contribute to providers’ policies by supplying a clearer portrait of the systemic relations involved in the value cocreation dynamics.