Re-Shaping Demand Landscapes: How Firms Change Customer Preferences to Better Fit Their Products

Strategic Management Journal (Forthcoming)

45 Pages Posted: 22 Aug 2019

Date Written: June 21, 2019

Abstract

What strategies do firms use to change their customers’ preferences? This paper addresses this question by developing a conceptual model that combines the representation of customer preferences as a demand landscape with research on marketing and psychology. I suggest that in addition to repositioning their products to accommodate customer preferences, firms also change the distribution of customer preferences to accommodate the firms’ products. Specifically, I argue that firms alter customer preferences by adding, removing, and transforming the dimensions of the demand landscape. I illustrate the model with an historical case study of the U.S. market for mortgage-backed securities (MBS) between 1968 and 1987, a period during which MBS issuers succeeded in reshaping the bond demand landscape to promote the acceptance of MBS as bonds.

Keywords: customer preferences, demand landscapes, demand-based view, historical case study, mortgage-backed securities

JEL Classification: D02, D22, G21, G23, N2

Suggested Citation

Vinokurova, Natalya, Re-Shaping Demand Landscapes: How Firms Change Customer Preferences to Better Fit Their Products (June 21, 2019). Strategic Management Journal (Forthcoming), Available at SSRN: https://ssrn.com/abstract=3439488

Natalya Vinokurova (Contact Author)

Lehigh University ( email )

621 Taylor Street
Bethlehem, PA 18015
United States

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