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Paper info: Marketing On Trial - Practices And Principles In The Case Of SAS' Eurobonus Program

Title


Marketing On Trial - Practices And Principles In The Case Of SAS' Eurobonus Program

Authors


Anders Liljenberg and
Hans Kjellberg
Stockholm School of Economics
Sweden
Hans Kjellberg

Place of Publication


The paper was published at the 19th IMP-conference in Lugano, Switzerland in 2003.

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Abstract


This paper follows the unfolding legal controversy between Scandinavian Airlines System (SAS) and the Swedish Competition Authority (SCA) regarding the formers? frequent flyer program (FFP), entitled EuroBonus. The controversy arises in late 1999 as SCA finds SAS? application of EuroBonus in Sweden to be at odds with the Swedish Competition Act (SFS 1993:20), article 19 on abuse of a dominant position. The dispute is settled in early 2001 as the Swedish Market court rules largely in favor of SCA. SAS is prohibited from applying its EuroBonus program on those domestic routes where there is competition. Although the case hosts an array of intriguing topics, e.g. defining the relevant market and determining dominance, this text revolves around the issue of abuse. The paper seeks to contribute to our understanding of the interrelation between ideas and principles concerning markets and marketing on the one hand, and market(ing) practice on the other. This topic is increasingly attended to also outside of marketing (see, e.g., Callon 1998). It is one particular such tradition that has inspired our method for mapping the controversy between practices and principles, the sociology of science and techniques (confer Law (1986, 1994), Latour (1987, 1996)). The text is divided into four main parts. Initially, the perspective adhered to, a performative view of market action, is presented together with its implication for how we choose to delineate the controversy. We then briefly look at the relevant legislation, and then at a few general accounts of the particular marketing practice under study, i.e. the enforcement of customer loyalty. In the next part, the case is presented. There, the two parties are invited to present their respective positions, and the Market court its motives for the final ruling. We conclude by discussing how this ruling still is but a temporary stabilization of FFP practice.