Advertisement

Soft Computing

, Volume 22, Issue 15, pp 4989–5005 | Cite as

Criteria evaluation for pricing decisions in strategic marketing management using an intuitionistic cognitive map approach

  • Elif Dogu
  • Y. Esra Albayrak
Focus

Abstract

Marketing decisions are challenging in profit-oriented companies because of their complex nature. Many factors influence the marketing strategy in the new product development (NPD) process. With this aspect, strategic marketing decisions for launching a product to the market can be observed as multiple criteria decision-making (MCDM) problems. This study proposes a novel approach called intuitionistic cognitive map (ICM), for assessing the criteria that influence the pricing strategy of a company in earlier stages of the product’s life cycle in the market. A framework is formed based on a profound analysis of literature and experts’ opinions, in terms of criteria affecting pricing strategy and the causal relationships between them. Intuitionistic fuzzy sets and cognitive mapping are used together to capture the hesitation of the decision makers caused by lack of information and to define cause-and-effect relations between the criteria to represent the complexity of strategic marketing decisions. Contrary to conventional MCDM methods that require complete data, ICM method is able to deal with lack of information and hesitancy of the decision makers. In addition, ICM method has a new feature called “the coefficient of synergy” incorporating the synergy effect of the application field in the model. The case study is conducted in a technological-device-manufacturing company. Seventeen factors that influence the company’s pricing decisions are determined and evaluated with three marketing experts, and in the numerical application, brand image, market share, consumer fidelity, market/segment size, and new product capability criteria had the maximum positive influence on pricing decisions.

Keywords

Decision support Strategic marketing management Pricing Cognitive mapping MCDM Intuitionistic environment New product development (NPD) 

Notes

Funding

This study is supported by Galatasaray University Research Fund.

Compliance with ethical standards

Conflict of interest

The authors declare that they have no competing interests.

Human and animals rights

This article does not contain any studies with animals performed by any of the authors.

Informed consent

Informed consent was obtained from all individual participants included in the study.

References

  1. Aaker DA, McLoughlin D (2010) Strategic market management: global perspectives, 1st edn. Wiley, HobokenGoogle Scholar
  2. Atanassov KT (1986) Intuitionistic fuzzy-sets. Fuzzy Sets Syst 20:87–96CrossRefzbMATHGoogle Scholar
  3. Atanassov KT (1999) Intuitionistic fuzzy sets: theory and applications. In: Studies in fuzziness and soft computing, vol 35. Physica, HeidelbergGoogle Scholar
  4. Axelrod R (1976) The cognitive mapping approach to decision making. Structure of decision, pp 221–250Google Scholar
  5. Azadeh A, Ziaei B, Moghaddam M (2012) A hybrid fuzzy regression-fuzzy cognitive map algorithm for forecasting and optimization of housing market fluctuations. Expert Syst Appl 39:298–315.  https://doi.org/10.1016/j.eswa.2011.07.020 CrossRefGoogle Scholar
  6. Bradley F (2003) Strategic marketing: in the customer driven organization. Wiley, ChicesterGoogle Scholar
  7. Buyukozkan G, Vardaloglu Z (2012) Analyzing of CPFR success factors using fuzzy cognitive maps in retail industry. Expert Syst Appl 39:10438–10455.  https://doi.org/10.1016/j.eswa.2012.02.014 CrossRefGoogle Scholar
  8. Das TK (2016) Multi-criteria decision making in marketing by using fuzzy rough set. In: Handbook of research on intelligent techniques and modeling applications in marketing analytics, pp 101–118.  https://doi.org/10.4018/978-1-5225-0997-4.ch006
  9. Davies SW, Geroski PA (1997) Changes in concentration, turbulence, and the dynamics of market shares. Rev Econ Stat 79:383–391CrossRefGoogle Scholar
  10. Denguir-Rekik A, Montmain J, Mauris G (2009) A possibilistic-valued multi-criteria decision-making support for marketing activities in e-commerce: feedback based diagnosis system. Euro J Oper Res 195:876–888.  https://doi.org/10.1016/j.ejor.2007.11.020 MathSciNetCrossRefzbMATHGoogle Scholar
  11. Dolan SL, Garcia S (2002) Managing by values: cultural redesign for strategic organizational change at the dawn of the twenty-first century. J Manag Dev 21:101–117CrossRefGoogle Scholar
  12. Drucker PF (1954) The practice of management, 1st edn. Harper, New YorkGoogle Scholar
  13. Ferrell OC, Hartline MD (2011) Marketing strategy, 5th edn. South-Western Cengage Learning, MasonGoogle Scholar
  14. Freter H, Baumgarth C (2004) Marktorientierte Unternehmensführung: Grundkonzepte, Anwendungen und Lehre: Festschrift fur Hermann Freter zum 60. P. Lang, Frankfurt am Main; New York, GeburtstagGoogle Scholar
  15. Froelich W, Wakulicz-Deja A (2007) Learning fuzzy cognitive maps from the web for the stock market decision support system. In: Wegrzyn-Wolska KM, Szczepaniak PS (eds) Advances in intelligent web mastering, vol 43. Advances in soft computing. Springer, Berlin, pp 106–111.  https://doi.org/10.1007/978-3-540-72575-6_17 CrossRefGoogle Scholar
  16. Georgopoulos VC, Malandraki GA, Stylios CD (2003) A fuzzy cognitive map approach to differential diagnosis of specific language impairment. Artif Intell Med 29:261–278CrossRefGoogle Scholar
  17. Glykas M (2010) Fuzzy cognitive maps: advances in theories, methodologies, applications and tools. Springer, BerlinCrossRefzbMATHGoogle Scholar
  18. Gürbüz T, Albayrak YE, Alaybeyoglu E (2014) Criteria weighting and 4P’s planning in marketing using a fuzzy metric distance and AHP hybrid method. Int J Comput Intell Syst 7:94–104.  https://doi.org/10.1080/18756891.2014.853936 CrossRefGoogle Scholar
  19. Hadjistoykov P, Atanassov K (2013) Remark on intuitionistic fuzzy cognitive maps. Notes Intuit Fuzzy Sets 19:1–6zbMATHGoogle Scholar
  20. Hadjistoykov PP, Atanassov KT (2014) On temporal intuitionistic fuzzy cognitive maps. C R Acad Bulg Sci 67:1233–1240MathSciNetzbMATHGoogle Scholar
  21. Huang SW, Lin YC, Liao CH (2016) Applying analytic hierarchy process (AHP) and grey relational analysis (GRA) to purchase factors of university students for smart phones. J Technol 31:193–208Google Scholar
  22. Iakovidis DK, Papageorgiou E (2011) Intuitionistic fuzzy cognitive maps for medical decision making. IEEE Trans Inf Technol Biomed 15:100–107CrossRefGoogle Scholar
  23. Ji GJ, Zhou Y (2004) Organizational values as “attractors of chaos”: an emerging informational change to manage organizational complexity. In: Service systems and service management—proceedings of ICSSSM’04, vols 1, 2. International Academic Publishers Ltd, Hong KongGoogle Scholar
  24. Kang I, Lee S, Choi JH (2004) Using fuzzy cognitive map for the relationship management in airline service. Expert Syst Appl 26:545–555.  https://doi.org/10.1016/j.eswa.2003.10.012 CrossRefGoogle Scholar
  25. Kardaras D, Karakostas B (1999) The use of fuzzy cognitive maps to simulate the information systems strategic planning process. Inf Softw Technol 41:197–210CrossRefGoogle Scholar
  26. Khatwani G, Srivastava PR (2015) Identifying organization preferences of internet marketing channels using hybrid fuzzy MCDM theories. J Electron Commer Organ 13:26–54.  https://doi.org/10.4018/jeco.2015100102 CrossRefGoogle Scholar
  27. Kim WC, Mauborgne RA (2005) Blue ocean strategy: how to create uncontested market space and make the competition irrelevant. Harvard Business School Press, BostonGoogle Scholar
  28. Kosko B (1986) Fuzzy cognitive maps. Int J Man Mach Stud 24:65–75.  https://doi.org/10.1016/S0020-7373(86)80040-2 CrossRefzbMATHGoogle Scholar
  29. Kosko B (1992) Neural networks and fuzzy systems. Prentice Hall, Upper Saddle RiverzbMATHGoogle Scholar
  30. Kotler P (1999) Le marketing selon Kotler. Village Mondial, ParisGoogle Scholar
  31. Kotler P, Armstrong G (2012) Principles of marketing, 14th edn. Pearson Prentice Hall, BostonGoogle Scholar
  32. Kotler P, Keller KL (2012) Marketing management, 14th edn. Prentice Hall, Upper Saddle RiverGoogle Scholar
  33. Lau H, Nakandala D, Samaranayake P, Shum P (2016) A hybrid multi-criteria decision model for supporting customer focused profitability analysis. Ind Manag Data Syst 116:1105–1130.  https://doi.org/10.1108/imds-10-2015-0410 CrossRefGoogle Scholar
  34. Lee KC, Lee H, Lee N, Lim J (2013) An agent-based fuzzy cognitive map approach to the strategic marketing planning for industrial firms. Ind Mark Manag 42:552–563CrossRefGoogle Scholar
  35. Li DF (2005) Multiattribute decision making models and methods using intuitionistic fuzzy sets. J Comput Syst Sci 70:73–85MathSciNetCrossRefzbMATHGoogle Scholar
  36. Liao CN, Lin CH, Fu YK (2016) Integrative model for the selection of a new product launch strategy, based on ANP, TOPSIS and MCGP: a case study. Technol Econ Dev Econ 22:715–737.  https://doi.org/10.3846/20294913.2015.1074951 CrossRefGoogle Scholar
  37. Lin CT, Lee C, Wu CS (2009) Optimizing a marketing expert decision process for the private hotel. Expert Syst Appl 36:5613–5619.  https://doi.org/10.1016/j.eswa.2008.06.113 CrossRefGoogle Scholar
  38. Marshall A (1997) Principles of economics. Great minds series. Prometheus Books, AmherstGoogle Scholar
  39. McCarthy EJ (1960) Basic marketing, a managerial approach. R.D. Irwin, HomewoodGoogle Scholar
  40. Ocampo L, Berdin Alarde RM, Kilongkilong DA, Esmero A (2016) Adoption of online marketing for service SMEs with multi-criteria decision-making approach. In: Handbook of research on intelligent techniques and modeling applications in marketing analytics, pp 226–243.  https://doi.org/10.4018/978-1-5225-0997-4.ch013
  41. Papageorgiou E, Spyridonos P, Stylios CD, Ravazoula P, Groumpos PP, Nikiforidis G (2006) Advanced soft computing diagnosis method for tumour grading. Artif Intell Med 36:59–70CrossRefGoogle Scholar
  42. Papageorgiou EI, Huszka C, De Roo J, Douali N, Jaulent M-C, Colaert D (2013) Application of probabilistic and fuzzy cognitive approaches in semantic web framework for medical decision support. Comput Methods Programs Biomed 112:580–598CrossRefGoogle Scholar
  43. Papageorgiou EI, Iakovidis DK (2013) Intuitionistic fuzzy cognitive maps. IEEE Trans Fuzzy Syst 21:342–354CrossRefGoogle Scholar
  44. Proctor T (2000) Strategic marketing: an introduction. Routledge, LondonCrossRefGoogle Scholar
  45. Raut RD, Mahajan VC (2015) A new strategic approach of fuzzy-quality function deployment and analytical hierarchy process in construction industry. Int J Logist Syst Manag 20:260–290.  https://doi.org/10.1504/ijlsm.2015.067296 CrossRefGoogle Scholar
  46. Relich M, Pawlewski P (2017) A fuzzy weighted average approach for selecting portfolio of new product development projects. Neurocomputing 231:19–27.  https://doi.org/10.1016/j.neucom.2016.05.104 CrossRefGoogle Scholar
  47. Ross TJ (2010) Fuzzy logic with engineering applications, 3rd edn. Wiley, ChichesterCrossRefGoogle Scholar
  48. Salmeron JL, Papageorgiou EI (2012) A fuzzy grey cognitive maps-based decision support system for radiotherapy treatment planning. Knowl Based Syst 30:151–160CrossRefGoogle Scholar
  49. Schnaars SP (1991) Marketing strategy: a customer-driven approach. Free Press, TorontoGoogle Scholar
  50. Stanton WJ (1981) Fundamentals of marketing, 6th edn. McGraw-Hill series in marketing. McGraw-Hill, New YorkGoogle Scholar
  51. Stigler GJ (1958) The economies of scale. J Law Econ 1:54–71CrossRefGoogle Scholar
  52. Stylios CD, Georgopoulos VC, Malandraki GA, Chouliara S (2008) Fuzzy cognitive map architectures for medical decision support systems. Appl Soft Comput 8:1243–1251CrossRefGoogle Scholar
  53. Taber R (1994) Fuzzy cognitive maps. AI Expert 9:18–23Google Scholar
  54. Taylor FW (1911) The principles of scientific management. Harper & Brothers, New YorkGoogle Scholar
  55. Tolman EC (1948) Cognitive maps in rats and men. Psychol Rev 55:189CrossRefGoogle Scholar
  56. Tsai WH, Chou WC, Leu JD (2011) An effectiveness evaluation model for the web-based marketing of the airline industry. Expert Syst Appl 38:15499–15516.  https://doi.org/10.1016/j.eswa.2011.06.009 Google Scholar
  57. Wang CH (2015) Using quality function deployment to conduct vendor assessment and supplier recommendation for business-intelligence systems. Comput Ind Eng 84:24–31.  https://doi.org/10.1016/j.cie.2014.10.005 CrossRefGoogle Scholar
  58. Wang YL, Tzeng GH (2012) Brand marketing for creating brand value based on a MCDM model combining DEMATEL with ANP and VIKOR methods. Expert Syst Appl 39:5600–5615.  https://doi.org/10.1016/j.eswa.2011.11.057 CrossRefGoogle Scholar
  59. Wilson RMS, Gilligan C (2005) Strategic marketing management: planning, implementation, and control, 3rd edn. The marketing series. Butterworth-Heinemann, OxfordGoogle Scholar
  60. Wu CS, Lin CT, Lee C (2010) Optimal marketing strategy: a decision-making with ANP and TOPSIS. Int J Prod Econ 127:190–196.  https://doi.org/10.1016/j.ijpe.2010.05.013 CrossRefGoogle Scholar
  61. Zaim H, Ramdani M, Haddi A (2016) Multi-criteria analysis approach based on consumer satisfaction to rank B2C E-commerce websites. In: SITA 2016—11th international conference on intelligent systems: theories and applications.  https://doi.org/10.1109/sita.2016.7772260

Copyright information

© Springer-Verlag GmbH Germany, part of Springer Nature 2018

Authors and Affiliations

  1. 1.Industrial Engineering DepartmentGalatasaray UniversityBesiktasTurkey

Personalised recommendations