Marketing Practices and Profitability of a Company: A Study by Machine Learning Method

Abstract

This paper addresses the question of existence of relationships between usage of contemporary marketing practices and profitability for companies operating on the Russian market. To address this issue, we utilize a machine learning method that so far was barely present in marketing and management science. The paper is not only promoting a novel research method, it also establishes the relationships between profitability and specific sets of marketing practices. We show that the companies having negative profitability make use of a wide spectrum of marketing practices (with an exception of interactive marketing) and they do not prioritize any specific types of practices. In contrary, profitable companies intensively use interactive marketing and also combine it with IT-marketing and network marketing. This shows that successful companies focus on relationship marketing in a variety of its forms.