Extending the Competitive Marketing Strategy Paradigm: The Role of Strategic Reference Points Theory Aviv Shoham Avi Fiegenbaum Technion-Israel Institute of Technology The purpose of this article is to extend and integrate the new strategic reference points theory (SRP), developed in the strategic management area, into the discipline of stra- tegic marketing management. The major new tenets of the theory are the inclusion of cognitive, organizational pro- cesses and benchmarking simultaneously. First, the authors describe the impact of the marketing SRP on mar- keting strategic choice behavior captured in the tradeoff between risk and return (risk avert vs. risk lover) as was proposed by prospect theory. Then, they explore the per- formance consequences of integrating the newly formed stages while considering organizational process and im- plementation issues of reference points such as content, configuration, consensus, and change. The relationship between marketing strategies and per- formance has been studied from numerous theoretical per- spectives (e.g., transaction cost economics, Rindfleisch and Heide 1997; market orientation, Jaworski and Kohli 1993; and profit impact of marketing strategy [PIMS], Szymanski, Bharadwaj, and Varadarajan 1993). The focus on the contents of marketing strategies has been valuable in identifying performance-enhancing strategies. How- ever, relatively few have examined the strategy selection and implementation processes and cognitive aspects that lead to selecting and executing one combination of strate- gies over another or the impact they have over performance. Journal of the Academy of Marketing Science. Volume 27, No. 4, pages 442-454. Copyright 9 1999 by Academy of Marketing Science. Notably, distinctive capabilities contribute to superior strategy selection and implementation and to sustainable competitive advantages. Capabilities are defined as "com- plex bundles of skills and accumulated knowledge, exer- cised through organizational processes, that enable firms to coordinate activities and make use of their assets" (Day 1994:38). In contrast, the contents of the marketing mix are easily imitated (Day 1990, 1994). Both strategy selection and execution processes drive performance. Thus, while K-Mart knows about Wal- Mart's superior logistics strategy (content), it cannot imi- tate it because it is embedded in a complex management process (implementation). Bartmess and Cerny (1993) noted that it is well known that the best strategy in the com- puter workstation market is rapid product development and rollout (content). However, the highly successful Sun Microsystems competes by emphasizing the processes that link manufacturing and design, design and customers, and design and purchasing (implementation). Creating and managing such links are less susceptible to imitation. These examples highlight the importance of "complexity" and "organizational diffuseness" (Amit and Schoemaker 1993; Peteraf 1993). The more complex the process under- lying superior strategies and the wider it cuts across func- tional groups, the more difficult it is to imitate (Bartmess and Cerny 1993). In sum, the implementation processes that support performance-enhancing strategies may be more important in explaining performance than the strate- gies themselves. Therefore, our article provides an effort to fill the gap in the literature identified above. Our main emphasis is on aspects of the strategy implementation process rather than