Journal of the Academy of Marketing Science (2019) 47:617–639

https://doi.org/10.1007/s11747-019-00643-z

ORIGINAL EMPIRICAL RESEARCH

Capabilities for market-shaping: triggering and facilitating increased

value creation
Suvi Nenonen 1 & Kaj Storbacka 1 & Charlotta Windahl 2

Received: 3 May 2018 / Accepted: 8 March 2019 / Published online: 2 April 2019
# Academy of Marketing Science 2019

Abstract
Applying grounded theory, we comprehensively categorize capabilities needed for market-shaping and synthesize them into a
conceptual framework that describes the process and its outcomes. We establish that in order to improve value creation in a
market, market-shapers must consider a larger system of relevant stakeholders, recognize the institutional arrangements
governing their behaviors, and foster new resource linkages within and across stakeholders. Based on our analysis, we identify
eight triggering capabilities, which generate new intra- and inter-stakeholder resource linkages by directly influencing various
characteristics of the market, and four facilitating capabilities, which enable market-shaping by discovering the value potential of
new resource linkages and augment the impact of the triggering capabilities by mobilizing relevant resources. We show that
triggering capabilities are context-specific, whereas facilitating capabilities are generic. We conclude that there are performance
outcomes of market-shaping not only for the shaping firm, but also for other stakeholders, and at overall market level.

Keywords Market-shaping . Marketing capabilities . Dynamic capabilities . Grounded theory

Introduction niche construction (Luksha 2008), market formation (Lee et al.

In addition to sensing and responding to changes in established
markets, firms increasingly undertake market-shaping strategies
(Gavetti et al. 2017) to create new business opportunities
(Alvarez and Barney 2007). Literature in management provides
insights into these agent-driven efforts to shape markets through
a range of approaches, such as effectuation (Sarasvathy 2008),
Satish Jayachandran served as Area Editor for this article.
Electronic supplementary material The online version of this article
(https://doi.org/10.1007/s11747-019-00643-z) contains supplementary
material, which is available to authorized users.
* Suvi Nenonen
s.nenonen@auckland.ac.nz
Kaj Storbacka
k.storbacka@auckland.ac.nz
Charlotta Windahl
c.windahl@auckland.ac.nz
1
Graduate School of Management, The University of Auckland
Business School, Private Bag 92019, Auckland 1142, New Zealand
2
Department of Marketing, The University of Auckland Business
School, Private Bag 92019, Auckland 1142, New Zealand
2018), and shaping strategy (Gavetti et al. 2017). Two streams of
marketing literature have also explored this phenomenon: proac-
tive market orientation (Narver et al. 2004) and market-driving
strategies (Jaworski et al. 2000). However, empirical work on
market-shaping is limited (Humphreys and Carpenter 2018),
leading Jaworski and Kohli (2017, p. 11) to conclude that Bthe
idea of shaping, molding, and managing the evolution of markets
has been around for some time, but has not taken off in terms of
systematic inquiry.^
Answering that call, the present study offers a systematic
inquiry focusing on the capabilities needed for market-shaping.
Building on recent reviews of marketing capabilities (Morgan
et al. 2018; Morgan 2012), we categorize both adaptive (Day
2011) and dynamic marketing (Morgan 2012) capabilities as
market information and knowledge capabilities (Moorman and
Day 2016). Both essentially anticipate trends and events in the
market before these fully reveal themselves, by virtue of a deep
understanding of customers, competitors, channel members,
and the wider business environment. However, firms also need
capabilities to act based on such market learning. Hence, we
posit that to support the formulation and execution of market-
shaping strategies, and to avoid widening the marketing capa-
bilities gap (Day 2011; Hillebrand et al. 2015), a comprehensive
view of market-shaping capabilities is needed.
618
Interestingly, the literature on dynamic capabilities points
to links between a firm’s dynamic capabilities and its ability to
influence markets. Generally, dynamic capabilities enable
firms to modify their resource base (Helfat et al. 2007) or to
create new resource configurations that help firms to deal with
changes in markets (Eisenhardt and Martin 2000). But dy-
namic capabilities also enable firms to not only address
but shape rapidly changing business environments (Teece
2007); in other words, they enable firms either to respond
to, or indeed to bring about, changes in the market (Teece
2016). Based on the latter ability, we can consider market-
shaping capabilities as being dynamic capabilities.
However, to our knowledge, no empirical research scruti-
nizes the connection between dynamic capabilities and
market-shaping. Indeed, comprehensive analyses of the
dynamic capabilities literature has led both Wilden et al.
(2016) and Schilke et al. (2018) to call for study into
dynamic capabilities’ role in shaping markets.
Against this backdrop, the purpose of our research is to: (1)
provide a comprehensive categorization of capabilities needed
for market-shaping, and (2) synthesize the identified capabil-
ities into a conceptual framework that describes the process of
market-shaping and its outcomes. We approach the phenom-
enon using a contemporary view of markets as value-creating
systems, where institutional arrangements govern the roles
and behaviors of various stakeholders (Arthur 2014;
Vargo and Lusch 2016). To address our research purpose,
we applied a grounded theory approach (Strauss and
Corbin 1997, 1998; Edmondson and McManus 2007), in
which we interviewed 82 managers from 21 firms that
have successfully shaped their markets.
The shaping of markets is nontrivial in that it goes beyond
incremental changes occurring in markets through the process
of competition. Market-shaping implies purposive actions by
a focal firm to change market characteristics by re-designing
the content of exchange, and/or re-configuring the network of
stakeholders involved, and/or re-forming the institutions that
govern all stakeholders’ behaviors in the market. These ac-
tions aim at creating new opportunities to link resources of
various stakeholders in ways that improve value creation in a
market. Hence, the market-shaping firms engage in a process
to (1) discover the value potential of linking intra- and inter-
stakeholder resources in novel ways, (2) trigger changes in
various market characteristics to enable the formation of
new resource linkages, and (3) mobilize relevant stakeholders
to free up extant resources for new uses.
Illustrative examples with characteristics of market-
shaping are the dramatic increase in digital platforms (e.g.,
Amazon, Airbnb, Uber, Hotels.com) allowing new groups of
stakeholders to engage and exchange with each other, various
forms of crowdsourcing, the transformation toward XaaS
(Banything-as-a-service^) in multiple contexts ranging from
software and music to legal services, and the reconfiguration
J. of the Acad. Mark. Sci. (2019) 47:617–639
of energy generation and distribution ecosystems for increased
sustainability.
We contribute to the literature on marketing and dynamic
capabilities by identifying two distinct types of deeply embed-
ded repeatable processes that together comprise the market-
shaping process: triggering and facilitating capabilities.
Triggering capabilities generate new intra- and inter-
stakeholder resource linkages by directly influencing various
aspects of the market. They focus on re-designing exchange,
re-configuring the network, and re-forming institutions.
Facilitating capabilities relate to the creative ability of the firm
and determine how the triggering capabilities are applied.
They enable market-shaping by facilitating discovery of the
value potential of new resource linkages; they also augment
the impact of the triggering capabilities by mobilizing relevant
resources. Our contribution is the comprehensive categoriza-
tion of market-shaping capabilities, rather than a detailed ex-
amination of each individual capability, as these themes have
been explored separately in extant literature. Our conceptual
framework also generates insights about the outcomes of
market-shaping for firms, stakeholders, and the market.
We also contribute to the understanding of dynamic capa-
bilities more generally. Existing conceptualizations and em-
pirical investigations concentrate on how dynamic capabilities
transform a firm; our study widens the scope of investigation
to cover how firms’ capabilities can transform the surrounding
system, i.e., the market.
Informed by Suddaby (2006) and Gioia et al. (2012), we
employ a traditional structure, first using literature to define
central concepts and later present our findings. It is, however,
important to note that our empirical analysis guided our con-
sultations of the literature. As themes, concepts, properties,
and dimensions emerged empirically, we used literature to
refine the articulation of emergent categorizations and rela-
tionships. After the central concepts, we describe our research
method. Next, to give the reader the Bbig picture^ up front, we
introduce our conceptual framework of market-shaping before
presenting the empirical findings related to triggering and fa-
cilitating capabilities. Finally, the conclusions explicate our
contributions to theory and managerial practice and nominate
directions for further research.
Markets, value creation, and shaping
In this section, using marketing, management, and innovation
literature, we provide theory-based explanations and defini-
tions for the concepts that our empirical analysis uses.
Market conceptualizations
Research in marketing and management is progressively rec-
ognizing markets as networks, systems, or ecosystems
J. of the Acad. Mark. Sci. (2019) 47:617–639
(Johanson and Vahlne 2011; Vargo and Lusch 2016; Adner
2017), suggesting a need to look beyond the seller–buyer dy-
ad, to see the dyad as part of a larger network or system of
stakeholders (Hult et al. 2011; Hillebrand et al. 2015). This
view implies that the locus of value creation moves beyond
the borders of the firm, i.e., value is viewed as co-created with
a multitude of stakeholders in the market, not only by the firm
and for the customer (Tantalo and Priem 2016). Hence, all
market participants assume dual identities as both resource
providers and value beneficiaries (Amit and Han 2017;
Vargo and Lusch 2016). This suggests that markets cannot
be understood only as a context for production and consump-
tion, but rather as a context for value co-creation.
Furthermore, research in marketing (e.g., Humphreys
2010; Scaraboto and Fischer 2012; Vargo and Lusch 2016)
increasingly draws on institutional theory (DiMaggio and
Powell 1991) as affording insights into market dynamics
(Hult 2011). Institutions are schemas, rules, norms, and rou-
tines that form authoritative guidelines for the behavior of
market actors (Scott 2005). The argument runs that markets
as value-creating systems are governed by institutions and
institutional arrangements that are themselves actor-
generated (Vargo and Lusch 2017). This raises questions as
to how institutions are Bcreated, diffused, adopted, and
adapted over space and time; and how they fall into decline
and disuse^ (Scott 2005, p. 461).
Consequently, to avoid the Bnew marketing myopia^
(Smith et al. 2010), a would-be market-shaping firm must
understand how a larger system of organizations and individ-
uals can co-create value and recognize the institutional ar-
rangements that govern everyone’s behavior in this process.
Value creation: Linking and integrating resources
The aim of market-shaping is to enhance the value creation
and realization for stakeholders in a market. Value creation
happens when resources are combined in novel ways
(Penrose 1959), the key being the ability to create, access,
deploy, combine, and exchange them (Lippman and Rumelt
2003; Moran and Ghoshal 1999). As Bingham and Eisenhardt
(2008) argue, it is not so much the attributes of resources that
matter, but the linkages between them. This emphasizes a
dynamic aspect of resources and their potentiality: resources
are not, but rather become, i.e., what is a resource (and its
value) is determined when linked and integrated with other
resources (Vargo and Lusch 2016).
Resource-based theory (RBT) has traditionally concerned
itself with deploying the focal firm’s resources for sustainable
competitive advantage (Barney et al. 2011). Key is therefore
resource orchestration (Sirmon et al. 2011), in the sense of
how managers structure, bundle, and leverage a firm’s re-
sources. Likewise, in the dynamic capabilities literature, the
mechanism through which dynamic capabilities affect
619
outcomes is by changing the focal firm’s resource base
(Schilke et al. 2018).
However, reconceptualizing markets as value-creating sys-
tems requires expanding the scope of resource linkages
(Kozlenkova et al. 2014; Day 2011). To successfully shape a
market for increased value creation, the shaping firm requires
capabilities not only to add, combine and deploy the firm’s
own resources, but also the resources of a network or system
of organizations and individuals, with the aim to enable new
types of resource linkages and integration patterns. In this
process, access to resources becomes as important as owner-
ship (Tantalo and Priem 2016).
Consequently, and building on Moran and Ghoshal (1999),
we view market-shaping as a purposive process by a focal
firm to (1) discover the value potential of linking intra- and
inter-stakeholder resources in novel ways, (2) trigger changes
in various market characteristics to enable the formation of
new resource linkages, and (3) mobilize relevant stakeholders
to free up extant resources for new uses.
Market-shaping and radical innovation
Like market-shaping, radical innovations (RI) can either trans-
form existing markets through dramatic behavioral changes or
create new ones (O'Connor and Rice 2013; Slater et al. 2014).
Both also go beyond incremental development and bring a
degree of novelty that is new not merely to the firm but
to the market—and sometimes the world (Garcia and
Calantone 2002). Both are longitudinal and non-linear
processes with high levels of uncertainty and complex-
ity, which calls for different managerial processes and
capabilities from those needed for incremental business
development (Slater et al. 2014).
However, the market-shaping phenomenon is not fully cap-
tured by the RI literature. RI implicitly assumes that the source
of the novelty is an (often technological) invention by the
focal firm that enables new products or processes
(McDermott and O'Connor 2002). By contrast, market-
shaping initiatives do not necessarily have their starting points
in a technology or new products or processes (Humphreys and
Carpenter 2018).This is illustrated later by our empirical data
(see Table 2), where the source of novelty for market-shaping
firms was often a new way of influencing other aspects of the
market, such as work division in the network or institutional
arrangements—like case Firm E eliminating restrictive
regulation.
Technology often plays a subtler role in market-shaping.
Market-shaping firms do not necessarily build their approach
on new technology at all, let alone technology they themselves
developed. They do, however, often rely on complementary
technologies when they explore for new ways to link re-
sources. A good example is the on-going digitalization, which
620
liquefies resources (Lusch et al. 2010), expanding the scope of
resources firms can access and utilize (Amit and Han 2017).
Further, the RI literature concentrates on (typically high-
tech) firms with major investments in R&D that create a
Bproduct-market for a new advanced technology^ (Reid and
de Brentani 2010, p. 500). Market-shaping is less focused on
product markets, and more on understanding the value-
creating system of which the firm is part. Market-shaping
firms have a Bsystem-based and value-creation-centric view^,
whereas the RI literature is often characterized by a Bfirm-
based and value-capture-centric view^ (Amit and Han 2017).
Market-shaping is rooted in firms’ ability to perceive the wider
network of organizations and change it to the advantage of
multiple beneficiaries, whereas RI implicitly concentrates on
the innovating firm and its value chain, with the goal to generate
competitive advantage and financial results for that firm (Reid
and de Brentani 2010).
Most radical innovations fail (Barczak et al. 2009), leading
O'Connor and Rice (2013) to conclude that firms do not seem
to recognize that capabilities for creating or transforming mar-
kets differ from those used in the earlier stages of the innova-
tion process. We see market creation as a special case of
market-shaping as it is likely that the same capabilities can
be used. This suggests that RI success at least can and, in some
cases, perhaps must be supported by market-shaping
capabilities.
Research method
Market-shaping is a complex and longitudinal process. As
such, inductive methods are useful to grasp the complexity
of the market system and understand individual firms’ pro-
cesses and experiences. Following the tradition of qualitative
inductive research approaches in marketing (Johnson and
Sohi 2016; Gebhardt et al. 2006), we adopted grounded theory
(Strauss and Corbin 1997, 1998) as our research method. The
following sub-sections describe our procedures for sampling,
data collection, and data analysis.
Sampling
We used theoretical sampling, which does not seek a repre-
sentative sample but rather one suitable for illuminating the
phenomenon under study (Strauss and Corbin 1998;
Eisenhardt and Graebner 2007). Theoretical sampling strives
toward Bpolar types,^ where a researcher samples the
extremes of the phenomenon (Eisenhardt and Graebner
2007). For us this meant finding firms from a multitude of
contexts, representing a wide spread of industry, size, country
of origin, international reach, technology, strategy, ownership,
and history, but sharing one commonality: a track record of
successful market-shaping.
J. of the Acad. Mark. Sci. (2019) 47:617–639
In grounded theory, sampling is a recurring activity, con-
stantly evolving based on the emerging theory (Mello and
Flint 2009). Therefore, our sampling process consisted of four
steps. The first step established three criteria for what a track
record of successfully engaging in market-shaping looks like
in the empirical domain. For this we developed three criteria.
First, building on the literature on institutional work/
entrepreneurship (Battilana et al. 2009; Lawrence and
Suddaby 2006), the firms must have purposefully engaged
in actions aimed at shaping aspects of their market. Second,
because we view markets as value-creating systems, we
looked for cases where the actions had improved not only case
firm performance but also altered the market in a way that was
recognized by other stakeholders. Finally, as the literatures on
market creation (O'Connor and Rice 2013), market formation
(Lee et al. 2018), and market driving (Humphreys and
Carpenter 2018) illustrate, a longitudinal perspective is need-
ed. To balance this with access to managers who had been
involved in the market-shaping actions and were still
employed by the market-shaping firm, we sought cases where
the process had lasted at least three years.
As a second step, we engaged six academics with research
records on change in market structures, and eight other experts
(representing research institutes and consulting firms) who
had first-hand knowledge of various firms in multiple coun-
tries, in discussions to identify firms fulfilling the defined
criteria. In total 41 candidate firms were identified.
The third step was desk research into the documented
market-shaping activities of all 41 firms. We populated a table
with the information gathered during our interviews with the
14 experts and the desk research, then invited the experts to fill
any gaps we had left or offer corrections. This step taught us
more about the possible participant firms and the differences
between them.
During the fourth step we started the concurrent data col-
lection and data analysis phases. To allow for the emergence
that characterizes grounded theory, we gathered data from
different geographies at different times. We investigated
Firm D first because, from our expert interviews and desk
research, we deemed it the most complete case of market-
shaping strategy vis-à-vis our pre-understanding of the phe-
nomenon. After each case we analyzed the data, outlined a
tentative (re)draft of the theoretical framework, and accord-
ingly chose as the next firm one that would best refine the
emerging theoretical framework. We reached data, theoretical,
and inductive thematic saturation (Saunders et al. 2017) after
21 case firms from diverse industries.
Within the case firms, we required access to infor-
mants who (1) held a senior position, (2) had been
involved in creating and/or implementing the market-
shaping strategy over a long period, and (3) would also
talk about controversial and unsuccessful aspects of
their firms’ market-shaping strategies.
J. of the Acad. Mark. Sci. (2019) 47:617–639 621

Table 1 profiles the case firms and interviewees, and Data analysis
Appendix 1 lists all the interviewees.
We analyzed our rich dataset in three phases. First, we coded
the interview data by open coding, going line-by-line and
Data collection assigning codes based on interviewees’ language and expres-
sions. During this stage, we used the constant comparative
Depending on the firm, it took from three to six interviews to method to continuously compare the codes against previous
reach firm-level saturation—where additional data did not incidents with the same or similar coding and to document
generate new emergent themes, concepts, properties, or di- researchers’ emerging ideas and working memos. This carried
mensions. This yielded an overall sample of 82 interviewees. us to the second stage, axial coding. Here interview data is
That sample size compares favorably to other grounded theory given more directed, selective, and conceptual codes. During
examinations in marketing (e.g., Johnson and Sohi 2016; Flint axial coding we also started Bconceptual ordering,^ organiz-
et al. 2002). The average length of interview was 59 minutes, ing data into categories based on the properties of the emerg-
and in total, the interview material consists of 4630 minutes, ing concepts and dimensions of these properties, i.e., the
or some 77 hours, of transcribed interviews. range along which a property varies. This second phase of
We employed an intensive interview format with broad, coding kept the constant comparative method running,
open-ended questions (Charmaz 2006). First, we with one addition: we also used the secondary materials
prompted interviewees to give personal accounts of their to inform our working memos. Finally, using selective
firm’s market-shaping initiatives. This made for opening coding, we related the categories that emerged to each
narratives unbiased by interviewers’ questions or theoret- other (Strauss and Corbin 1997, 1998).
ical framing. Even though the opening questions on our In practice, we used NVivo qualitative software to facilitate
interview guide remained largely unchanged, the follow- the three coding rounds. Two members of the research team
up questions evolved constantly to reflect the emerging did the coding in parallel, allowing constant comparison of
theoretical framework. The illustrative interview guide interpretations, codes, and working memos.
can be found in the Web Appendix. To make results more reliable, we carried out member
checking (Lincoln and Guba 1985) at three points. First, each
interviewee was given their interview transcript and the op-
Table 1 Sample characteristics
portunity to comment on it. Second, we sent each interview-
Category # case firms # interviewees ee our analysis of their firm and its market-shaping capa-
bilities. Finally, we invited feedback on the overall anal-
Industry groups ysis results presented in this paper. Figure 1 depicts the
Agriculture, forestry & fishing 3 13 intertwined and iterative data collection and analysis pro-
Construction & manufacturing 5 19 cedures used in this study.
Transportation, communication & utilities 1 4 To assess trustworthiness, we applied criteria from in-
Wholesale & retail trade 4 15 terpretive research and grounded theory and focused on
Services 8 31 pre-understanding, credibility, transferability, dependabil-
Firm size (annual sales USD) ity, conformability, integrity, fit, understanding, generali-
< 10 million 6 25 ty, utilization, and control (Flint et al. 2002; Lincoln and
10–99 million 2 8 Guba 1985; Miles and Huberman 1994; Spiggle 1994;
100–999 million 3 9 Strauss and Corbin 1990).
≥ 1 billion 8 32 To categorize the capabilities needed for market-shaping,
≥ 10 billion 2 8 we adopted the Gioia methodology (Gioia et al. 2012). This
Geographical reach of operations employs a data structure consisting of informant-centric prop-
1–2 countries 8 34 erties (activities case firms engaged in), theory-centric con-
3+ countries 10 35 cepts (capabilities), and overarching aggregate themes (capa-
Global 3 13 bility sets). Due to the richness of the data, and as suggested
Respondent level by Suddaby (2006), we demonstrate the evolution of our con-
Entry to mid-level manager or expert 6 ceptual categories and provide verbatim illustrations from our
Senior executive N/A 50 data in a series of tables in the Web Appendix.
Managing director, president or CEO 24 In line with grounded research, and although naturally we
Member of the Board of Directors 2 were not uninformed about previous work in this area, we
Total 21 82 gave priority to the empirical data. Later in the process, we
engaged in Btacking back and forth^ between empirical
622
Fig. 1 Overview of the research process
analysis and literature, and as dimensions, properties, con-
cepts, and themes emerged, used literature to refine the artic-
ulation of emergent categorizations and their relationships
(Gioia et al. 2012). To compensate for marketing’s lack of
theoretical explanations (Ketchen and Hult 2011), in
Appendix 2 we provide connections to extant marketing and
management literature that can supports and explains the em-
pirical findings.
Market-shaping: A conceptual framework
Our data analysis yielded two distinct types of market-shaping
capabilities: triggering and facilitating. Triggering capabilities
generate new resource linkages by directly influencing vari-
ous market-level characteristics. They focus on re-designing
exchange, re-configuring the network, and re-forming in-
stitutions. Facilitating capabilities relate to the creative
ability of the firm to determine which triggering capabil-
ities are applied and how. They enable market-shaping by
discovering the value potential of new resource linkages,
and augment the impact of the triggering capabilities by
mobilizing relevant intra- and inter-stakeholder resource
integration.
Importantly, this categorization resonates with Hine et al.
(2014), who distinguish between lower- and higher-level
dynamic capabilities. For them, lower-level dynamic
Bfunctional^ capabilities are directly responsible for firm ac-
tions in dynamic environments, whereas higher-level dynamic
Blearning^ capabilities relate to the creative ability of the firm
and determine how the functional capabilities are applied to
impact firm outputs and performance. Building on this, we
view market-shaping capabilities as deeply embedded
repeatable processes that either (1) directly trigger new
resource linkages (lower-level dynamic capabilities), or
J. of the Acad. Mark. Sci. (2019) 47:617–639
(2) facilitate the discovery of the value potential of new
resource linkages, and the mobilization of related re-
sources (higher-level dynamic capabilities).
In our analysis, the distinctness of triggering and facilitat-
ing capabilities showed up sharply in the fundamentally dif-
ferent dimensional ranges of the properties (Strauss 1987;
Mello and Flint 2009). The properties underlying triggering
capabilities ranged in dimension between Boften done by the
firm^ and Bnot done at all,^ i.e., describing frequency of an
activity and being discrete, concrete, and quantitative, or even
binary (how often they were turned on/off). By contrast, the
properties linked to facilitating capabilities had the di-
mensional range of Bthe firm is very strong in this –
the firm is relatively weak in this.^ That range describes
a level of mastery and is rather more qualitative. For
example, one of the properties related to triggering capa-
bilities is Binfluencing terminology used.^ Across the 21
participant firms, the dimensional range of this particular
property showed that some firms did not aim to influence
the terminology used in the market at all, whereas other
firms were frequently engaged in activities to influence
the terminology. BArticulating a win-win-win vision for
the future market,^ on the other hand, is an example of a
property related to facilitating capabilities. Dimensionally
this property ranged from Bmoderate skill^ in this activ-
ity on the part of some firms to Bexceptional mastery^ of
it by others.
It is notable in the descriptions below that the eight trigger-
ing capabilities are expressed as transitive verbs with
objects—signifying an immediate action exerted on the
market—whereas the single-word facilitating capabilities in-
dicate dispositions, attitudes, approaches, and posture to the
system at large.
To offer the reader a Bbig picture,^ we now present an
overview of our findings before further discussing the
J. of the Acad. Mark. Sci. (2019) 47:617–639 623

Fig. 2 Market-shaping – capabilities and outcomes

capabilities identified above. First, our synthesized conceptual
framework in Fig. 2 illustrates how the identified capabilities
relate to each other and to the outcomes of market-shaping.
Second, to identify the extent to which our 21 case firms had
utilized the triggering and facilitating capabilities described in
the following sections, we undertook an analysis, depicted in
the profiles in Table 2.
In the next two sections we provide summaries of the find-
ings and resultant categorizations separately for the two types
of market-shaping capabilities. We keep these summaries
short because extant literature already explores the individual
themes separately (see our referencing to some theoretical
underpinnings in Appendix 2). Our contribution is the
comprehensive categorization of market-shaping capabilities,
rather than a detailed examination of each individual
capability.
In each section, after the summary, we make further obser-
vations about the capabilities and their role in market-shaping,
building both on the empirical data and our consultations of
literature.

Table 2 Capability profiles of case firms

Capability set Capability A B C D E F G H I J K L M N O P Q R S T U ∑

Triggering Re-designing exchange Developing products • • • • • • • • • • • • • 13

Adjusting price of pricing • • • • • • • 7
Modifying matching methods • • • • • • • 7
Re-configuring network Modifying own supply network • • • • • • • • • • • 11
Modifying customer-side features • • • • • • • • • • • 11
Modifying provision • • • • • • • 7
Re-forming institutions Influencing representations • • • • • • • • • • 10
Influencing norms • • • • • • • • • • • • 12
Facilitating Discovering value Exploring • • • • • • • • • • • • • • • • • • • • • 21
potential
Experimenting • • • • • • • • • • • • • • • • • • • • • 21
Mobilizing resources Expressing • • • • • • • • • • • • • • • • • • • • • 21
Engaging • • • • • • • • • • • • • • • • • • • • • 21
624
Triggering capabilities: Generating new
resource linkages
In our analysis we identified 25 properties that describe activ-
ities used by the firms to directly trigger modifications of
various market-level characteristics. These coalesce into eight
concepts or triggering capabilities. We identified three aggre-
gate themes, or triggering capability sets: capabilities related
to re-designing exchange, re-configuring the network, and re-
forming institutions (see Fig. 3). Next, we will discuss the
themes separately, and illustrate some of the many underlying
activities.
Fig. 3 Triggering capabilities
J. of the Acad. Mark. Sci. (2019) 47:617–639
Re-designing exchange
An expected outcome from our analysis was that market-
shaping firms actively develop and manipulate their busi-
ness models and marketing mix to alter how resources
are exchanged. What our empirical data made possible,
however, was to furnish a structure for this. Under the
theme of re-designing exchange, we identified seven ac-
tivities, which were grouped into three triggering capa-
bilities (see Table W1 in the Web Appendix): developing
products, adjusting price or pricing, and modifying
matching methods.
J. of the Acad. Mark. Sci. (2019) 47:617–639
Developing products took many forms, the first being
product and service innovations to improve use-value for cus-
tomers. Such product and service innovations were often im-
provements, as exemplified by Firm N’s introduction of an
automatic savings feature on existing checking accounts.
However, we also observed introductions of completely new
products and services, such as Firm P’s use of basic research to
create a feeding pellet for a special breed of tropical fish:
Arowana fish, they don’t usually eat pellet food, you
need to feed them frogs, worms, centipedes. […] My
boss has through his research been able to develop an
attractant inside the pellet where the arowana is really
attracted to the pellet and takes it in. [ID: 60]
Another form of developing products related to various efforts
to rescope the offering by bundling more items into a larger
Bsolution^—or the opposite: unbundling previously integrat-
ed offerings to allow customers to buy only the items they
prefer. A third key development trajectory for many firms
was the re-definition of property rights exchanged; typically,
from selling ownership rights to selling access rights. For ex-
ample, Firm R’s facility management clients used to purchase
and maintain their own in-house signage, but now Firm R
provides this service for a monthly fee.
In the next triggering capability, pricing adjustments often
mirrored re-definitions of the product. Many firms were ac-
tively developing their revenue models, by changing the logic
by which their products or services were priced. Hence, price
bundling and unbundling was a key design parameter.
Furthermore, some firms were re-defining the price carrier
(Normann 2001), i.e., what customers were paying for. An
example of this was a change from charging for services based
on an hourly rate (time as a price carrier) to charging for a
bundled offering per month or year (the solution as price car-
rier), as was done by the legal services provider, Firm A:
We will take care of all of your legal matters, for a fixed
price if just possible. […] The prevailing [hourly] pric-
ing model distorts things in two ways. On one hand, the
customer might not ask for help, even when help is
needed, as they are afraid of the costs. On the other
hand, the lawyer doesn’t dare to offer more services as
he is afraid that the customer perceives him as a mere
sales person. [ID: 1]
Additionally, some firms used more traditional pricing strate-
gies, concerned with raising or lowering the price point, as part
of their market-shaping efforts. Firm L (in food and beverages)
nearly doubled the prices of their products to signal the creation
of a new market space—with a positive overall sales effect.
Driven by digitalization opportunities, many firms were
actively looking for new ways to connect with customer
625
demand, or new Bmatching methods^ (Roth 2008)—the third
triggering capability. This took two forms. First was using
new (often digital) channels to connect provider and customer
resources, as exemplified by Firm G, which introduced an
online channel allowing owners of holiday houses to mar-
ket them for short-term rental, pre-dating Airbnb and sim-
ilar platforms. Second, we observed development of new
transaction mechanisms, an example being construction
Firm H, which created a marketplace for their distributors
to bid on consumer leads.
Re-configuring network
As shown in Fig. 3, our empirical analysis supports the argu-
ments for taking a broader view of the market. The market-
shaping firms analyzed were actively involved in
transforming the larger networks or ecosystems that they pop-
ulate. In fact, many of them showed an exceptional talent in
applying a systemic view to their development efforts. In do-
ing so, firms were—if we apply a stakeholder theory lens—
focusing both on primary and secondary stakeholders (Hult
et al. 2011). We identified ten activities, which were grouped
into three triggering capabilities (see Table W2 in the Web
Appendix): modifying the focal firm’s own supply network,
modifying various customer-side features, and modifying pro-
vision, i.e., the availability of competing products or services.
The network-related capabilities clearly indicate a need for
market-shaping firms to identify opportunities to re-configure
the number and roles of various stakeholders, and the work
division between them. A particularly important group of
changes concerned adding new, or removing existing, organi-
zations from the network, namely, suppliers, customers, and
competitors. For example, Firm J created standardized
exercise-to-music classes, which eliminated the need for indi-
vidual instructors to have in-depth knowledge of choreogra-
phy and physiology. Since the growth of this market was
capped by the limited number of suitable instructors,
unblocking that supply bottleneck acted as a market-
widening move. Changes in work division effectively were
out- versus in-sourcing decisions with suppliers, and self- ver-
sus full-service decisions with customers. As an example of
the former, Firm Q, a provider of full-service meal kits with
recipes, out-sourced packing the kits to large bricks-and-
mortar grocery chains, thus enabling faster growth.
A particularly important aspect of re-configuring the net-
work is the development of supporting infrastructure and
know-how—competencies to use the product or service. Just
as a car is useless without roads and people who know how to
drive, new markets especially depend on supporting re-
sources. For example, a consortium of wine companies
(Firm K) published a textbook for winemakers about how to
move from cork to screwcap as a method of sealing wine
bottles. Similarly, many firms focused on securing the
626
provision of competing products or services in the market, or
in other words supporting the formation of competition. The
main argument they advanced for this was that without alter-
native offerings in the market, customers would not see the
new market as legitimate. Firm E articulated this:
We definitely didn’t try to keep others away from the
market, our aspiration was to encourage them. […] We
developed this open wood building system. Because we
thought that there has to be open competition. Otherwise
customers won’t get on board, if they know that there is
only one provider. [ID: 20]
Re-forming institutions
The final theme in Fig. 3 relates to institutions. We identified
eight activities, which we grouped into two triggering capa-
bilities (see Table W3 in the Web Appendix): influencing rep-
resentations that portray or characterize a new or shaped mar-
ket and influencing the norms, or the rules of the game, in the
market.
In terms of representations, interestingly, many of the
market-shaping firms found it beneficial to introduce new
terms that somehow crystallized the change they were mak-
ing. The benefit was coining a Bnew language^ that both dis-
tinguished the Bnew^ market from the existing one and helped
the focal firm to legitimize the change. For example, crystal-
lizing the concept of Bduty of care^ was instrumental for Firm
O in communicating the value of medical and security ser-
vices for large employers with a mobile or remote workforce.
Legitimization also drew important support from media’s por-
trayals, as highlighted by the senior vice president of Firm L:
We engaged the media very, very much. And I would
say that they played quite a strong role in also giving us
and the industry the awareness that was needed in the
early days. [ID: 46]
Similarly, encouraging third party research agencies to under-
take research about the new market’s development and its key
players as well as influencing industry associations—the busi-
nesses they represent, the themes they promote, and the
awards that they present—were important parts of the legiti-
mizing process. As an example of the latter, the forestry prod-
ucts company, Firm E, deliberately joined the building indus-
try association—and encouraged other forestry product com-
panies to do the same—in order to ensure that wooden build-
ing technologies were represented alongside steel and
concrete.
When it comes to norms, the sampled firms saw influenc-
ing or creating standards as a way of both starting a market-
wide change and scaling it up. The technical standards seemed
J. of the Acad. Mark. Sci. (2019) 47:617–639
more important in a B2B context, such as for the industrial
components produced by Firm B: it is crucial for the viability
of the company and the entire market that all components and
technologies work together and can be mixed-and-matched
across organizational boundaries. Influencing formal rules
and laws, on the other hand, was of interest to most firms:
Firm I’s efforts to be more transparent about the ingredients
of food products are an example from a B2C context, whereas
Firm O’s lobbying of national health and safety regulations
illuminates a B2B angle on the same phenomenon. We ob-
served social norms being altered in relation to both con-
sumers’ preferences and industry conventions. Indeed, for
many organizations the ability to dislodge deeply embedded
conventions was central. For Firm D, shaping the medical
services market required actively questioning long-held con-
ventions connected to the role of the medical doctor. To alter
the path-dependent processes related to sick-leaves they ap-
plied radical changes:
We took the pens away from the doctors. So, they are no
longer allowed to determine the length of the sick leave,
as they have learned completely flawed bases for these
things in the medical school. [ID: 13]
Triggering capabilities are contextually contingent
Comparing the capability profiles employed by the case firms
(see Table 2) generates interesting insights. The profiles sug-
gest that triggering capabilities differ fundamentally from fa-
cilitating capabilities in their sensitivity to context. None of
the 21 case firms applied all eight triggering capabilities. For
example, Firm L applied triggering capabilities for adjusting
price or pricing, modifying customer-side features, and mod-
ifying provision, whereas the triggering capabilities expressed
by Firm F were solely for modifying customer-side features,
influencing representations, and influencing norms.
The analysis suggests that market-shaping firms apply only
those triggering capabilities necessary in a specific context to
influence the system in question. To simplify: if, for instance,
a firm’s market-shaping strategy does not require a change in
pricing, then the capability of adjusting price and pricing is not
applied.
Equally intriguing is that none of the case firms focused on
a single triggering capability—the analysis clearly shows that
firms apply idiosyncratic triggering capability combinations
or patterns. This is consistent with the contemporary view of
markets as complex systems: attempting to change only one
part or element of the system is likely to fail, as the elements
are interconnected and contingent on each other.
Such patterns are contextually driven: different industries,
different stages of market development, and the level of com-
petitive and technological turbulence all influence the pattern.
J. of the Acad. Mark. Sci. (2019) 47:617–639
Further, there are two distinct categories of these market-
shaping patterns. In one category, capabilities are deployed
simultaneously, with the goal of making the market more sus-
ceptible to development and change. In the other, firms use
various capabilities sequentially, gradually influencing the
market system. Sequential deployment bears obvious connec-
tions to the emergent character of systemic markets under the
contemporary view (Mars et al. 2012) and to the entrepreneur-
ial mindset in the shaping firm (Ireland et al. 2003): when
firms start their market-shaping efforts they may apply certain
capabilities, and based on how the market resonates and re-
sponds, they may then apply new capabilities.
The analysis indicates that crafting successful market-
shaping strategies requires selecting the correct patterns of
capabilities for a specific context. Thus, applying triggering
capabilities does not in itself ensure that resource linkages are
created, and more value is created; that requires the right com-
binations of these capabilities. These findings are congruent
both with the extensive literature on contingency theory and
the literature on configurational fit (Doty et al. 1993; Olson
et al. 2005; Feng et al. 2017). Contingency theory suggests that
there is no one best way to organize but that the various ways
of organizing are equally effective. Consequently, Scott (2005)
argues that choices of how to organize activities depend on the
nature of a firm’s business environment, so firms need to un-
derstand how to achieve configurational fit between their var-
ious activities and the environments in which they operate.
Facilitating capabilities: Enabling
and augmenting market-shaping
We identified 17 properties describing the creative abilities of
the firms to determine which triggering capabilities should be
applied and how. These are further categorized into four con-
cepts or facilitating capabilities. We identified two aggregate
themes or facilitating capability sets (see Fig. 2): capabilities
that enable market-shaping by discovering or inventing the
value potential of new resource linkages in the market system
and capabilities that augment market-shaping by mobilizing
intra- and inter-stakeholder resources for new types of re-
source integration. As in the previous section on triggering
capabilities, we structure our findings by the aggregate themes
(Fig. 4). The facilitating capabilities are also interrelated (Fig.
2). In fact, the empirical analysis highlights that market-
shaping is not a linear process. Instead it is characterized by
numerous feedback loops and iterations.
Discovering value potential
Our analysis shows that market-shaping firms undertake var-
ious activities to more richly understand novel opportunities to
link resources in a market to improve value creation. Under
627
the theme of discovering value potential, we identified eight
activities, grouped into two facilitating capabilities (see
Table W4 i n t he Web Appendix): exploring and
experimenting. Exploring refers to the ability to recognize
the system-wide availability of resources that can be re-linked.
Exploring requires that organizations understand how value is
created in the market system and how to enhance it further by
thinking and acting with the entire market system in mind.
Experimenting refers to the ability to involve the organization
in systematically probing the market system’s receptiveness to
new ideas, and to embrace the often-unexpected develop-
ments that such probing results in.
Under exploring, many of the firms analyzed showed an
ability to reframe phenomena, by changing their point of ref-
erence. For example, the starting point for Firm A, an innova-
tive legal services provider, was the founder’s experience as a
strategy consultant helping start-ups to standardize their ser-
vices: could legal advice, too, be turned into standard
Bproducts^? In-depth understanding of customers’ value cre-
ation appears to be central to market-shaping strategies, but
often this is complemented by insights into other organizations’
value creation as well—and often this value is not limited to
financial value alone. Firm J, constrained by the number of
suitable instructors available for its exercise-to-music classes,
realized that the key to attracting these essential suppliers (most
instructors being independent contractors) is to make them the
most popular instructors in their geographical area:
Every instructor wants more people in the room, so
you’re playing an incredibly big emotional card. You
know, do you want to be […] the Alpha instructor with
20 people in the room or do you want to be the Beta
teacher with 100? I mean vanity will win out any day of
the week. [ID: 39]
The firms were involved in making system-level trade-offs
even in highly complex contexts. Many deliberately opted
for solutions that allowed them to act ethically; to maximize
the overall value creation to customers and other stakeholders
in the long term rather than optimizing their own value capture
in the short term. For example, Firm N’s retail banking divi-
sion brushed against their colleagues in the credit card division
when trying to boost financial literacy among young cus-
tomers. Notwithstanding that credit card interest rates are al-
ways conspicuously high, the bank as a whole concluded that
it is better to educate youth about the consequences of interest
rates and the importance of paying credit card bills in
full—even if learning that lesson hampered the profitability
of one unit in the short term.
Under experimentation, many market-shaping initiatives
were at least partly the fruit of embracing some unforeseen
serendipity, either internal or external, instead of relying strict-
ly on linear planning processes, as the experience of Firm F
628
Fig. 4 Facilitating capabilities
illustrates. Visiting a customer, they noticed that their machin-
ery was used in an unusual way, which made then realize how
this machinery—combined with other technologies—enabled
customers to create value in novel ways:
We had a funny incident. In 2001 we sold a piece of
machinery that was supposed to run some 5000 hours
per year, 12 hours per day on average. But when we
visited this site in 2004, we realized that our customer
was only using the machine for 1000 hours a year. […] I
still remember that one of our guys asked, as we really
had to ask: Bwhat are you doing?^ And the client said:
BLook, now I have a hundred megawatts – and look,
now it’s gone. This is a dispatcher’s dream.^ […] And
that’s how this idea originally started. [ID: 23]
Since the redefining of various business model elements is a
highly complex task, most case firms approached market-
shaping as an iterative process of ongoing simulation, concep-
tualization, and experimentation. Additionally, many larger
firms experienced problems in motivating their market-
shaping actions, as many actions were not investments in the
sense that they could be activated in the balance sheet, but
rather cost reallocations in the profit and loss (P&L) statement.
For Firm D, getting a Byes^ to their market-shaping initiative
J. of the Acad. Mark. Sci. (2019) 47:617–639
from the Board required nine months of non-stop internal
selling. For many firms, success also depended on being able
to overcome hurdles related to traditional investment process-
es, by re-defining Binvestment.^ Normally investments are
viewed from a balance sheet perspective (costs are acti-
vated into the balance sheet and depreciated over time),
whereas Binvestments^ in a market-shaping context often
are cost-allocations (indicating short-term impacts on the
P&L statement). As the head of business development in
Firm E explains:
This is the weakness when you venture to uncharted
territories. Nobody will define what your timeframe will
be, or how much you can invest. These are seen as
operative costs, not as investments which will have a
certain payback after a certain period of time. [ID: 21]
Mobilizing resources
The 21 firms analyzed were all operating based on the insight
that influencing a complex market system requires access to
other stakeholder’s resources, which is not possible without
involving these organizations. Under the theme of mobilizing
resources, we identified nine activities, grouped into two
J. of the Acad. Mark. Sci. (2019) 47:617–639
facilitating capabilities (see Table W5 in the Web Appendix):
expressing and engaging. Expressing refers to the ability to
purposefully author meanings that resonate with relevant or-
ganizations in the market. Expressing aims at building credi-
bility for both the market-shaping firm and the market vision
advocated and encourages fellow stakeholders to participate
in market-level change. Engaging refers to the ability to redi-
rect stakeholder resources from existing uses through collec-
tive action. As market-shaping takes active participation by
many stakeholders, the focal firms actively formed partner-
ships and supported other stakeholders to change how they
operated.
Expressing the opportunities afforded by a new or shaped
market was a central capability conducted by the market-
shaping firms we analyzed. Being able to communicate the
proposed market-level change in a language accessible to cus-
tomers and other stakeholders was often crucial. Firm I, in its
foodservice business, has been determined to hire employees
with backgrounds in their clients’ industries to explain the
firm’s market-shaping initiatives in a language that makes
sense for customers: BI hire chefs because chefs can talk to
chefs^ [ID: 36].
To improve credibility, firms purposefully highlighted the
trustworthiness of the individuals and the firm behind the
market-shaping strategy. For example, Firm J—a global sports
and wellbeing company—used the fact that the founding fam-
ily boasted several Olympic and Commonwealth Games ath-
letes as a platform for their market-shaping strategies. Many
market-shaping firms not only articulated to potential collab-
orators the benefits of the market-shaping strategy but quan-
tified them in financial terms or demonstrated them by other
tangible means. Hence Firm A has invested time and effort in
gathering reliable empirical evidence about the financial ben-
efits of switching from traditional legal services to more stan-
dardized ones. Furthermore, most market-shaping firms
sought strategies that benefited multiple fellow stakeholders
in their market system, thus demonstrating capabilities to align
interests and craft win-win-win outcomes. As the CEO of
Firm M (from the retail sector) explains:
You got to work on this win-win-win basis. It’s a sus-
tainable business model. Our customers must win, sup-
plier must win, and we must win. And with these three,
this equation is a sustainable equation. [ID: 51]
The firms aimed to engage many stakeholders in creating and
supporting the change. For example, Firm H created a tool to
lower the threshold for consumers and distributors to consider
customized outdoor buildings instead of standard ones:
This design tool actually engineers and prices your
building as you’re designing it. And within a couple of
minutes you can create full planned outputs and take
629
them straight to Council if you like. And our distributor
can have a customer in front of them and can be
tweaking and playing with their design immediately.
[ID: 32]
The heightening engagement seemed more a case of allowing
customers and stakeholders to engage than deliberate attempts
to manage engagement. In the case of Firm N, the financial
services and insurance company aiming to improve financial
literacy among youth, the executives were pleasantly sur-
prised when young customers started sharing pictures of their
new debit cards (complete with automatic savings feature) on
Instagram and other social media. Educating customers and
other stakeholders about the change often took place via lead
customers or other visible stakeholders, as exemplified by the
consortium of wine companies, Firm K, which encouraged a
prominent wine journalist to write about their quest to migrate
from unreliable corks to more reliable screwcaps:
No, you couldn’t [buy such marketing]. So, he was, you
know he was Mr Wine really. […] That endorsement
brought other endorsements; other wine writers agreed.
[ID: 41]
Finally, market-shaping firms commonly lowered the risk of
change to the other stakeholders—or incentivized the change
by other means. For example, Firm U introduced an establish-
ment guarantee for forest owners in order to lower the per-
ceived risk related to using their new planting and forest man-
agement services:
So, we have introduced an establishment guarantee for
the customers. So, we guarantee a certain plant survival
rate during the first year, and this is something that the
customers like; since they buy both the plant and the
planting service from one company, there is no void
where the plant supplier can blame the planting firm;
instead we take full responsibility. [ID: 79]
Facilitating capabilities make market-shaping
processes possible
Our data suggests that the exploring and experimenting capa-
bilities exploit an organization’s heightened state of awareness
(Day 2011) trained on understanding the contingencies of the
market, i.e., identifying or inventing opportunities for novel
resource linkages in systemic markets. In addition, they not
only let the firm predict marketplace changes but, by generat-
ing heightened awareness about the value potential of new
linkages, also help reveal ways it can initiate such changes.
Teece (2007) discussed sensing as a matter of scanning,
creation, learning, and interpretation. Based on our research
630
we qualify this approach by separately discussing exploring
and experimentation. Exploring specifically relates to so-
called Bdistant search^ (Nelson and Winter 1982), in which
the firm looks beyond its current neighborhood to discover
alternative development trajectories (Schilke et al. 2018;
Afuah and Tucci 2012). Exploration requires, rather than dis-
courages, high variety.
Experimentation, on the other hand, highlights the heuris-
tics used by firms to deal with and narrow down genuine
uncertainty (Sarasvathy 2008). To deal with uncertainty and
unfamiliarity, firms may gain more insights by relying on fre-
quent and systematic experimentation (Day 2011; O'Connor
and Rice 2013). Such experimentation helps market-shaping
firms to free themselves of path dependency and instead un-
dertake path creation, actively creating and testing new oppor-
tunities where none may have previously existed (Luksha
2008), and actively learning from the experiments.
Hence, the exploring and experimenting capabilities are
essentially antecedents, enabling market-shaping efforts by
discovering or inventing new resource linkages that improve
value creation.
The expressing and engaging capabilities, on the other
hand, mobilize resources of various stakeholders so that new
resource linkages and resource integration patterns can devel-
op. Mobilization aims at motivating stakeholders to join in
new resource integration processes, by expressing the value
of change and engaging stakeholders in collective action.
The expressing capabilities aim at convincing potential col-
laborators in the market that the envisioned market is more
valuable to them than the current one. Our empirical data
illustrates that successful market-shaping firms purposefully
author and express meanings (Weick 1995) that resonate with
relevant stakeholders. It is easier for market-shapers to mobi-
lize resources for new ideas if they perform symbolic
actions—actions to draw attention to meanings beyond intrin-
sic content or functional use (Zott and Huy 2007). According
to Santos and Eisenhardt (2009), firms can claim a market by
conveying the superior experience of leaders, spreading sym-
bolic narratives, and using examples from other types of mar-
kets. This behavior resonates with signaling theory (Connelly
et al. 2011), according to which signaling effectiveness can be
enhanced by signal reliability and credibility driven by signal-
er quality, combined with signal fit, observability, and clarity.
To engage collaborators in the market, firms often rely on
distributed leadership (Bolden 2011), which lets many stake-
holders influence how the market develops. Collective action
among market actors is often necessary (Humphreys and
Carpenter 2018) to ensure the creation of Bmaterial and
sociocognitive elements supporting the functioning of a stable
market^ (Lee et al. 2018, p. 243). Drawing on resource mobi-
lization theory (McCarthy and Zald 1977), we argue that the
underlying purpose of such observable collective action is to
redirect resources from existing uses to new ones. Resources
J. of the Acad. Mark. Sci. (2019) 47:617–639
are more likely to be available for mobilization if there is
Borganization-stakeholder fit^ (Bundy et al. 2018), which is
driven by value congruence and strategic complementarity
between the collaborators. This fit is likely to improve over
time, suggesting that it is easier to mobilize resources in rela-
tionships that have existed for some time.
In their synthesis of various approaches to market orienta-
tion, Hult and Ketchen (2017) identify four dimensions: em-
phasis on stakeholders, importance of information, inter-
functional coordination, and taking action. Concurring with
their synthesis, our research supports the need for an emphasis
on stakeholders and the need for taking action. Somewhat
qualifying that synthesis, however, our results also highlight
that information, whilst important, should be complemented
by higher-level learning (our exploring and experimenting),
and that inter-functional coordination needs to be extended
toward inter-organizational resource mobilization (expressing
and engaging). A focal firm with well-established capabilities
to express the value of its market vision to other stakeholders
and to engage them in changing their practices will likely
succeed better in altering its market than a company without
these higher-level capabilities.
As noted under our discussion of triggering capabilities,
and by contrast, the empirical data suggests that applying fa-
cilitating capabilities is not contingent on context. On the con-
trary, all case firms demonstrated moderate to high levels of
mastery in applying all four facilitating capabilities (see
Table 2). Facilitating capabilities can be applied to enable
and augment any market-shaping strategies in any context.
Indeed, it seems that without the facilitating capabilities, using
triggering capabilities will not yield the desired outcomes in
terms of a shaped market.
Importantly though, whilst the facilitating capabilities seem
to be a necessary condition for successful market-shaping,
they are not a sufficient condition. Would-be market-shapers
should aim for a balanced development of both triggering and
facilitating capabilities. Such development is likely to be non-
linear, as new facilitating capabilities reveal opportunities to
trigger change, and these triggering activities expose further
needs to develop facilitating capabilities. We illustrate the in-
terconnectedness of the capability sets in Fig. 2.
Market-shaping outcomes
In this section we further explore our findings related to the
outcomes of market-shaping as depicted in our conceptual
framework (Fig. 2), firstly new resource linkages and second-
ly performance outcomes. Market-shaping aims at influencing
market-level characteristics, congruent with the aspects of
markets named in the triggering capabilities and their under-
lying activities (see Fig. 3). However, the transition from dy-
adic relational thinking to complex systems thinking
J. of the Acad. Mark. Sci. (2019) 47:617–639
(Hillebrand et al. 2015) reveals that nobody can fully predict
or control the development of this value-creating system.
Consequently, markets develop in a constantly shifting bal-
ance between deliberate design efforts by various stake-
holders, and spontaneous emergent developments (Mars
et al. 2012). The argument is that firms shape markets as much
as markets shape firms (Teece 2011).
Hence, the application of triggering capabilities by any sin-
gle firm will not have a simple and perfect impact on market-
level characteristics. Instead, market-shaping activities by other
competing and partnering stakeholders (Azimont and Araujo
2007; Martin and Schouten 2014) and the emergent processes
present in complex market systems (Mars et al. 2012) moderate
the impact of triggering capabilities. This is further supported
by several studies that report on the moderating effects of com-
petitive intensity, technological turbulence, and changing cus-
tomer preferences on business model innovation (Kumar et al.
2011; Menguc and Auh 2006; Kirca et al. 2005).
The combined outcome of market-shaping activities and
emergence is institutionalized modifications of exchange
(products, pricing, matching methods), and/or the structure
and work division of the relevant network of stakeholders,
and/or in various representations and norms (Garud et al.
2013). These modifications result in new resource linkages,
enabling stakeholders to engage in new resource integration
patterns that increase value creation.
A key question, however, relates to the appropriation
of this new value. Our research illustrates three aspects to
this. First, there are effects on market-level performance
outcomes, sometimes referred to as Bincreasing the size of
the pie^ i.e., growing the size and profitability of the
markets (Gulati and Wang 2003; Tantalo and Priem
2016). Our empirical data supports this line of reasoning;
many of the firms reported that due to their efforts, the
market had grown more rapidly. Interestingly, the market-
ing literature is silent about the impact of market-shaping
on market-level performance outcomes. This is likely to
be because the unit of analysis in most studies is the focal
firm and its relationship with primarily customers and
only secondarily other stakeholders.
Second, our empirical research, supported by literature,
suggests that purposeful market-shaping will improve a focal
firm’s performance outcomes. Literature claims that shaping
can have major direct effects on the performance of the shaper
(Gavetti et al. 2017), also labeled entrepreneurial rents
(Alvarez 2007) or influence rents (Keyhani et al. 2015).
Furthermore, it is suggested that proactive market-shaping
leads to sales growth and lifts financial performance and mar-
ket share for the shaping firm (Van Vuuren and Wörgötter
2013; Kumar et al. 2000).
Finally, our empirical data further illustrates that market-
shaping efforts are also likely to have performance outcomes
for other stakeholders, including not only customers, but also
631
suppliers, channel partners, and even competitors. As reported
above, many of the case firms highlighted the need to align
interests and craft win-win-win outcomes in order to be able to
mobilize needed resources. This is congruent with the idea of
stakeholder synergy, in which value creation can be synergis-
tically shared by several stakeholders (Tantalo and Priem
2016), and the recently proposed Bsystem-based and value-
creation-centric approach,^ as a complement to the Bfirm-
based and value-capture-centric approach^ (Amit and Han
2017). It also resonates with Kumar et al. (2000) and
Jaworski and Kohli (1996), who argued that market orienta-
tion has customer consequences such as higher quality and
improved level and speed of service.
Conclusions
We answer the call by Jaworski and Kohli (2017) for
systematic inquiry into shaping, molding, and managing
the evolution of markets, and the calls by Wilden et al.
(2016) and Schilke et al. (2018) to address dynamic
capabilities’ role in shaping markets. The purpose of our
research was to: (1) provide a comprehensive categoriza-
tion of capabilities needed for market-shaping and (2)
synthesize the identified capabilities into a conceptual
framework that describes the process of market-shaping
and its outcomes.
In this section we discuss the theoretical contributions from
our findings about market-shaping capabilities to extant liter-
ature, identify managerial implications, and suggest avenues
for further research.
Theoretical contributions
We contribute to the literature on marketing capabilities and
dynamic capabilities in five ways. First, whereas this litera-
ture, and likewise the literatures on market orientation and
resource-based theory (RBT), typically focus on the individ-
ual firm, our results clearly illustrate that market-shaping firms
embrace a systemic or networked view of the market. Market-
shapers do not concentrate exclusively on the resources they
control but also consider mobilizing resources controlled by
other organizations and individuals. Our findings illustrate
that improved value creation requires—judiciously—linking
resources between various organizations and individuals in
novel ways, making inter-stakeholder resource linkages the
core of market-shaping.
Second, previous research in marketing has developed
frameworks that describe and examine both antecedents
and outcomes of market-driving or proactive market ori-
entation strategies (Van Vuuren and Wörgötter 2013;
Blocker et al. 2011; Menguc and Auh 2006; Jaworski
et al. 2000), as well as the challenges to implementing
632
innovative and entrepreneurial practices in large organiza-
tions (Kumar et al. 2000; Carrillat et al. 2004). But the
discussion about capabilities behind such strategies or
practices has remained embryonic. To our knowledge,
the proposed eight triggering capabilities and four facili-
tating capabilities offer the first comprehensive and em-
pirically grounded conceptualization of capabilities need-
ed for the strategy and practice of market-shaping.
Third, our conceptual framework characterizes the differ-
ences between the triggering and facilitating capabilities and
simultaneously illustrates their interconnectedness, deepening
knowledge of both the market-shaping process and its out-
comes. Compared to previous research on market-driving
and proactive market orientation, our framework also under-
lines the need to measure performance outcomes not only for
the shaping firm, but also for other stakeholders in the market,
and at the overall market level.
Fourth, whereas extant research on market orientation
(Narver and Slater 1990) and marketing capabilities (Day
2011) has discussed organizational learning (cf., Slater and
Narver 1995), literature on what we identify as the
Bmobilizing resources^ capability set within the facilitating
capabilities, and particularly on our Bengaging^ capability
within that set, is scant. However, recent developments in
the literature on customer engagement (Li et al. 2018) feature
similar arguments to ours. Future research should widen the
focus from customer engagement to include understanding the
engagement of any actor involved in resource integration and
value co-creation (Storbacka et al. 2016). Taking the perspec-
tive of actors, implies a need to look beyond the dyad
(Alexander et al. 2018) and encourage key stakeholders to
contribute resources beyond simple exchange processes. Our
findings identify several activities of successful market-
shaping firms to engage other stakeholders to contribute
resources.
Finally, our analysis also contributes by expanding our un-
derstanding of dynamic capabilities more generally. Even
though certain dynamic capability scholars (Eisenhardt and
Martin 2000; Teece 2007, 2016) acknowledge that dynamic
capabilities can also induce changes in the markets or business
ecosystems surrounding the firm, existing conceptualizations
and empirical investigations focus on how dynamic capabili-
ties help firms to sense and seize opportunities, and in turn,
transform a firm (Teece 2018). We expand the fundamental
scope of investigation to cover how firms’ capabilities trans-
form the surrounding system, i.e., the market. Two of our
facilitating capabilities, namely expressing and engaging,
which are among what Hine et al. (2014) call higher level
dynamic capabilities—expressing and engaging—
particularly enhance understanding of the dynamic
J. of the Acad. Mark. Sci. (2019) 47:617–639
capabilities needed to effectively influence the wider operat-
ing environment and forge new resource linkages.
Managerial implications
Our findings suggest that to be successful in market-shaping,
firms need to broaden their strategic focus. In addition to hav-
ing competitive strategies aimed at increasing market share,
firms should also develop strategies for Bincreasing the size of
the pie^ (Gulati and Wang 2003; Tantalo and Priem 2016),
i.e., growing the size and profitability of the markets they
operate in. Developing such market-sharping strategies re-
quires that firms adopt a systemic view of their markets, and
deliberately pay attention to the opportunities and develop-
ments beyond the firm–customer and firm–competitor dyads.
To successfully implement these market-shaping strategies,
firms should strive to develop two capability sets: triggering
and facilitating. Triggering capabilities are responsible for di-
rectly inducing change in the market system by re-designing
exchange, re-configuring the network, and re-forming institu-
tions. Many firms have well-developed capabilities for re-
designing exchange: innovating their products and services,
pricing, and the channels that connect them to their customers.
To complement these exchange-oriented capabilities, market-
shaping firms should develop capabilities to systematically re-
configure their business networks and re-form institutions sur-
rounding them. It is also important to note that no functional
area commands the resources or expertise related to all trig-
gering capabilities. Thus, cross-functional coordination and
alignment is key to successful market-shaping strategies.
Facilitating capabilities, on the other hand, characterize the
culture of successful market-shapers. Would-be market-
shapers must foster underlying activities related to exploring
and experimenting to identify the potential of new resource
linkages to increase value creation in the market, and express
their market vision to external stakeholders, as well as engage
them to free up resources for new uses.
Our analysis also yields important practical guidance about
the process and outcomes of market-shaping strategies. First,
all our case firms had been involved with active market-
shaping for years before they saw considerable market-level
changes. Thus, a market-shaping approach seems best suited
for longer-term strategies and as a complement to shorter-term
competitive strategies. Second, successful market-shaping
strategies generated positive performance outcomes also for
the other stakeholders in the market than the market-shaping
firm. Therefore, firms should prioritize those market-shaping
opportunities that are likely to create considerable value for
also other stakeholders in addition to themselves and their
direct customers.
J. of the Acad. Mark. Sci. (2019) 47:617–639
Limitations and future research
We used theoretical sampling to identify the 21 case firms and
the 82 interviewees. While our sampling adhered to the prin-
ciples of grounded theory, and generated a rich understanding
of the phenomenon, three noteworthy limitations suggest in-
teresting avenues for further research. First, even though the
degree of success varies between the 21 cases, our sample
does not include any clearly failed cases. A comparison be-
tween successful and failed attempts to shape a market would
likely make it possible to distinguish the capabilities most
central to success.
Second, our case firms were all headquartered in de-
veloped open economies and naturally did not cover all
industries. Even though the markets shaped by these 21
case firms were not confined to these geographies or to
d ev e l o pe d ec o n om i e s , it i s p o s s i b l e th at be i n g
headquartered in a developed open economy influences
firms’ market-shaping strategies. A more systematic com-
parison between market-shaping carried out in different
institutional contexts will shed light on the role institu-
tional frameworks and country cultures play for the capa-
bilities needed. Furthermore, it is likely that industries
differ in terms of their institutional context, competitive
intensity, technological turbulence, investments in R&D,
and so forth. For instance, our sample featured no tele-
communication, pharmaceutical, or consumer electronics
firms, which are known for large investments in new tech-
nologies and related market-making efforts. Hence, fur-
ther research could expressly compare industries in terms
of some central differentiating characteristics, such as
those just mentioned.
Third, because our research focused on the capabilities
of focal market-shaping firms, our sample lacks accounts
from other stakeholders in the market systems—the likes
of customers, suppliers, competitors, or regulators. As our
results illustrated that success in market-shaping hinges
on many stakeholders collaborating, longitudinal research
expanding the unit of analysis to a system level and fo-
cusing on all relevant stakeholders in a market-shaping
process is likely to generate significant insights related
both to the pushing and pulling during the process and
to the capabilities required.
Our results also point to other interesting research oppor-
tunities. The most pressing one builds on the observation that
facilitating capabilities were generic in nature and triggering
633
capabilities contextual. The observed contextual differences in
how triggering capabilities are applied would especially repay
further research. Eisenhardt and Martin (2000) suggest that
different contexts require different dynamic capabilities.
Therefore, it may be possible to categorize different market-
shaping contexts empirically by investigating patterns in ap-
plying triggering capabilities. This resonates with Bingham
et al. (2007), who suggest that firms develop context-
specific heuristics.
Our findings also serve as a starting point for more
operational and quantitative research. All 12 capabilities
identified, and the associated 42 activities, need further
operationalization and explication. Future research could
develop a scale for market-shaping orientation or readiness
and examine how far the capabilities lead to notable conse-
quences in the market, and to positive performance outcomes
for the market-shaping firm.
The radical innovation literature, which typically fo-
cuses on high-tech firms, is particularly interested in a
specific case of market-shaping, i.e., market creation
(Reid and de Brentani 2010). However, as most radical
innovation fails (Barczak et al. 2009; Chiesa and
Frattini 2011; Slater et al. 2014), market creation seems
to be the least well-managed part of the innovation pro-
cess. In their review of market creation, O'Connor and
Rice (2013) conclude that the time and money needed
for market creation are grossly underestimated. Firms do
not seem to recognize that capabilities for market crea-
tion are different from those used in the earlier stages of
the innovation process. Hence, we suggest that combin-
ing our findings with the insights from the radical in-
novation literature is a promising avenue for further
research.
Acknowledgements The authors would like to thank Melissa
Akaka, Luis Araujo, Roderick J. Brodie, Karen Fernandez,
Pennie Frow, Hans Kjellberg, Cristina Mele, Jakki Mohr,
Kristian Möller, Adrian Payne and Jaqueline Pels for their support
during the research process and comments on earlier versions of
the article, and the editor, area editor and three anonymous
reviewers for their help in developing the manuscript. We also
acknowledge the input of the participants in the first workshop
of the Market Shaping and Innovation (MASHIN) special interest
group of the Australian & New Zealand Marketing Academy
(ANZMAC).
Funding This research is funded by a Marsden grant (UOA1333) from
the Royal Society of New Zealand.
634 J. of the Acad. Mark. Sci. (2019) 47:617–639

Appendix 1

List of interviewees

Firm ID Title / role at the company Industry

A 1 Head of department Legal services

A 2 Founder, head of sales and marketing Legal services
A 3 Managing director Legal services
A 4 Senior legal counsel Legal services
B 5 Managing director Components
B 6 VP, technology & sourcing Components
B 7 VP, international operations Components
C 8 Director of a business unit Machinery
C 9 Executive VP, business division X Machinery
C 10 Director, new business concepts Machinery
C 11 Executive VP, human resources Machinery
D 13 CEO Financial services & insurance
D 14 Executive medical director Financial services & insurance
D 15 Nursing director Financial services & insurance
D 16 VP, product development Financial services & insurance
D 17 Managing director Financial services & insurance
E 18 Managing director Forest products
E 19 R&D and design director Forest products
E 20 Director, sales and projects Forest products
E 21 Head of business development Forest products
F 22 Executive VP, human resources Machinery
F 23 VP, marketing & business dev. Machinery
F 24 Director, market development Machinery
F 25 General manager Machinery
G 26 Chief technology officer Travel & hospitality
G 27 Co-founder Travel & hospitality
G 28 Co-founder & director Travel & hospitality
G 29 Founder & general manager Travel & hospitality
H 30 Business manager Construction
H 31 General manager Construction
H 32 Brand manager Construction
I 33 General manager Food & beverage
I 34 Global sales capability manager Food & beverage
I 35 Global director Food & beverage
I 36 VP, business unit X Food & beverage
J 37 Director Sports & wellbeing
J 38 Founder & CEO Sports & wellbeing
J 39 Various leadership positions Sports & wellbeing
J 40 Former CEO Sports & wellbeing
K 41 Founder & winemaker Food & beverage
K 42 Winemaker Food & beverage
K 43 Founder Food & beverage
K 44 Founder & winemaker Food & beverage
K 45 Founder Food & beverage
L 46 Senior VP, brand development Food & beverage
L 47 Chairman Food & beverage
J. of the Acad. Mark. Sci. (2019) 47:617–639 635

L 48 Senior VP, human resources Food & beverage

M 49 Deputy CEO, operations Retail
M 50 Former member of the Board Retail
M 51 CEO Retail
M 52 Deputy CEO, merchandising Retail
N 53 Assistant VP, advertising & branding Financial services & insurance
N 54 Head of business unit X Financial services & insurance
N 55 Segment manager Financial services & insurance
N 56 VP, experience design Financial services & insurance
O 57 Managing director Healthcare
O 58 Director, business unit X Healthcare
O 59 Director, business unit X Healthcare
P 60 Manager, R&D Pets & pet accessories
P 61 General manager Pets & pet accessories
P 62 Executive chairman & MD Pets & pet accessories
P 63 Senior manager, human resources Pets & pet accessories
P 64 CEO Retail
P 65 Chief financial officer Retail
Q 66 Chief marketing officer Retail
Q 67 Manager, R&D & product dev. Retail
R 68 Senior VP, business unit X Facility management
R 69 Manager, business dev. & innovation Facility management
S 70 Director Facility management
S 71 CEO Utilities
S 72 Chief business developer Utilities
S 73 Head of business unit X Utilities
S 74 Business developer Utilities
T 75 Product manager Machinery
T 76 CEO Machinery
T 77 Member of the Board Machinery
T 78 Founder & former CEO Machinery
U 79 Founder & CEO Forestry services
U 80 Manager Forestry services
U 81 General manager Forestry services
U 82 Manager Forestry services
636
Appendix 2
Market-shaping capabilities and theoretical underpinnings
Market-shaping Definitions
capabilities
Triggering Re-designing exchange Modifying business models: developing products,
capabilities adjusting price or pricing, and modifying matching
methods for supply and demand.
Re-configuring network Modifying network structure: modifying the focal firm’s
own supply network, modifying various
customer-side features, and modifying provision; i.e.;
the availability of competing offerings.
Re-forming institutions Influencing−various representations that portray or
characterize a new or shaped market, and influencing
the norms, or the rules of the game.
Facilitating Discovering value Exploring resource potentiality: recognize the
capabilities potential system-wide availability of resources that can enable
increased value creation.
Experimenting to learn with the market: probing the
market with new approaches and adjusting approach
based on stakeholders’ response.
Mobilizing resources Expressing: purposeful authoring of meanings that
resonate with relevant stakeholders.
Engaging: redirecting stakeholder resources from
existing uses through collective action and
distributed leadership.
J. of the Acad. Mark. Sci. (2019) 47:617–639
Theoretical underpinnings
Specialized and cross-functional marketing capabilities (Morgan 2012).
Value innovation (Matthyssens et al. 2006; Kim and Mauborgne 1999).
Business model conceptualizations: product, price, pricing logic,
matching methods (Wirtz et al. 2016; Teece 2018).
Business model innovation (Foss and Saebi 2017; Casadesus-Masanell
and Zhu 2013; Chesbrough 2010).
Creating new revenue models and finding new partners (O'Connor and
Rice 2013).
Matching methods key to market design (Roth 2008).
Elimination or functional modification of suppliers; new web of
stakeholders (Jaworski et al. 2000).
Adding activities linking activities differently, changing the parties that
carry out activities (Amit and Zott 2012).
Resource configuration theory (Sirmon et al. 2011).
Get access to and orchestrate, resources controlled by others (Amit and
Han 2017).
Ability to create value or innovations dependent on complementary
resource providers (Adner and Kapoor 2010). Infrastructures are
needed to access resources (Teece 2007).
For demand to emerge, there must be sufficient and credible supply
(Agarwal and Bayus 2002).
Representational practices (Kjellberg and Helgesson 2006).
Labelling strategies: claiming, disassociating and hedging (Granqvist
et al. 2013).
Performativity of market research (Jacobi et al. 2015; Diaz Ruiz 2013).
Markets are shaped when new resource linkages become
institutionalized (Wieland et al. 2017).
Institutional work (Lawrence and Suddaby 2006) or entrepreneurship
(Battilana et al. 2009).
Institutional innovation (Hargrave and Van de Ven 2006).
Sensing capabilities (Morgan 2012; Day 2011; Teece 2007; Slater and
Narver 1995).
Creative capability: ability to recognize the value of resources before
competitors (Collis 1994).
Foresight: foreseeing shape of future before it materializes; insight:
uncovering ways that give birth to the future (Zahra and Nambisan
2012).
Distant search (Nelson and Winter 1982) to discover alternative de-
velopment trajectories (Afuah and Tucci 2012).
Higher-level generative or expansive learning (Engeström 2001; Senge
1990).
Gain insights by relying on frequent and systematic experimentation
(Day 2011; O'Connor and Rice 2013). Network learning: not learn-
ing within networks but as networks (Knight and Pye 2005).
From learning ‘about the market’ toward learning ‘with the market’
(Storbacka and Nenonen 2015).
Effectual theory (Sarasvathy 2008).
Path creation, actively creating and testing new opportunities (Luksha
2008).
Signaling theory (Connelly et al. 2011).
Symbolic action (Zott and Huy 2007; Santos and Eisenhardt 2009).
Collaborative processes of sense-making and sense-giving (Gioia and
Chittipeddi 1991) to support cognitive shifts (Foldy et al. 2008).
Frame alignment in social movements (Snow et al. 1986).
Resource mobilization theory: redirect resources from existing uses to
new ones (McCarthy and Zald 1977).
Stickiness of resources (Penrose 1959).
Network inertia: existing network perceived to generate synergies (Kim
et al. 2006).
Distributed leadership: enable many market participants to influence
how the market develops (Gronn 2002).
Collective action to create material and socio-cognitive market
elements (Lee et al. 2018).
J. of the Acad. Mark. Sci. (2019) 47:617–639
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