Contingency Theory

Examples of Contingency Theory in the following topics:

• New Service Development

  • Drawing on contingency theory, an idea central to new service development is that different service, market, and technology combinations can require different marketing strategies and business models to make them a success.

• Undifferentiated Targeting

  • In theory, this would directly correlate with a larger number of sales or buy in to the product.
  • Success with an undifferentiated market approach is also contingent on the abilities of the marketer to correctly identify potential customers and design an effective and competitive strategy.

• The Diffusion of Innovation

  • The diffusion of innovation theory seeks to explain how, why, and at what rate new ideas and technology spread through cultures.
  • The diffusion of innovation is a theory that seeks to explain how, why, and at what rate new ideas and technology spread through cultures.
  • The origins of the diffusion of innovation theory are varied and span multiple disciplines.
  • Everett Rogers, a professor of rural sociology, popularized the theory in his 1962 book Diffusion of Innovations.
  • Rogers (1962) espoused the theory that there are four main elements that influence the spread of a new idea:

• Monitoring Competition

  • Visualize marketing strategy as a huge chess game where one player is constantly making his or her moves contingent on what the other player does.

• Channel Power, Control, and Leadership

  • While the answer is contingent upon many factors, in general, the manufacturer should lead if the design and redesign of the channel is best done by the manufacturer and if control of the product—merchandising, repair, etc.

• Selecting Marketing Channels

  • While the answer is contingent upon many factors, in general, the manufacturer should lead if control of the product (merchandising, repair) is critical and if the design and redesign of the channel is best done by the manufacturer.

• Motivation

  • Incentive Theory: A reward, tangible or intangible, is presented after the occurrence of a behavior, with the intent of causing the behavior to occur again.
  • Incentive theory in psychology treats motivation and behavior of the individual as though they are influenced by beliefs, such as engaging in activities that are expected to be profitable.
  • Drive-reduction theory: Individuals have certain biological drives, such as hunger.
  • Cognitive dissonance theory: Cognitive dissonance occurs when an individual experiences an inconsistency between their views of the world around them and their own personal feelings and actions.

• Learning

  • There are three main categories of learning theory: behaviorism, cognitivism, and constructivism.
  • Cognitive theories look beyond behavior to explain brain-based learning.
  • Kolb styles model is based on the experiential learning theory, which was explained in his book Experiential Learning: Experience as the Source of Learning and Development (1984).
  • An individual may exhibit a preference for one of the four styles—accommodating, converging, diverging, and assimilating—depending on his or her approach to learning via the experiential learning theory model.
  • Kolb styles model is based on the experiential learning theory.

• Applying the Diffusion of Innovation Theory

  • In applying the diffusion of innovation theory, it is important to understand potential adopters and their decision-making process.
  • In applying the diffusion of innovation theory, it is important to understand potential adopters and their decision-making process.
  • Illustrate how the diffusion of innovation theory influences consumer adoption of products and services

• Psychological Pricing

  • Psychological pricing is a marketing practice based on the theory that certain prices have meaning to many buyers.
  • The psychological pricing theory is based on one or more of the following hypotheses: