SME Internet use and strategic flexibility: the moderating effect of IT market orientation

Abstract

One of the most important topics in the marketing literature has been the concept of market orientation. However, questions remain as to the dynamics of how market orientation translates into intermediate capabilities. This study explores relationships among different types of Internet usage, IT market orientation (the extent to which IT is aligned to manage customer and competitor information and internal activities), and strategic flexibility (firm capability to respond to the need for change). Specifically, use of the Internet for communication with relevant stakeholders, owing to its market-sensing potential, should be positively and significantly related to strategic flexibility for SMEs with more IT market-oriented alignment. The market-sensing potential of Internet communication to impact strategic flexibility positively for SMEs is likely to be lost under low IT market-oriented-alignment conditions. In contrast, IT market orientation should not moderate the relationship between Internet use for transactions with relevant stakeholders and strategic flexibility, given that the typical order taking and processing is a static, routine function for SMEs. Results supported hypothesised relationships. By delineating the type of Internet usage and required IT alignment that contribute to leveraging the Internet effectively, findings hold implications for future research by clarifying boundary conditions for Internet effects. Specifying how and when Internet use promotes strategic flexibility, an important enabler of competitive advantage, helps small business owner/managers better utilise their limited resources.     

Market orientation among small Korean exporters

Day's conceptual framework linking market orientation with business performance is adapted for the export market, and is empirically tested using a sample of 341 small Korean exporters. The modified measures of market orientation have reasonably high degree of reliability. The prescribed relationships in the framework are supported by empirical findings. The implications are that in a highly volatile export market; market orientation indeed plays a key role in the success of small Korean exporters.     

Internet marketing capabilities and international market growth

The Internet has been shown to facilitate elements of internationalisation such as information accumulation and network opportunities. However, there is limited understanding of how the Internet combined with marketing capabilities drives international market growth. This study, based on a sample of 224 Australian firms, develops and tests, using structural equation modelling (SEM), a conceptual model of Internet marketing capabilities and international market growth. Results indicate that firms deploying Internet marketing capabilities will benefit due to the reduction of information uncertainty and increased capacity to develop international network capabilities. Moreover, Internet marketing capabilities indirectly lead to international market growth when the firm has a high level of international strategic orientation and international network capabilities. Overall, Internet marketing capabilities enhance the firm's ability to generate other internal capabilities within the firm, which in turn have a positive impact on the international market growth of the firm.     

Internet Usage Within B2B Relationships and Its Impact on Value Creation: A Conceptual Model and Research Propositions

ABSTRACT

The Internet has been described as a major disruptive technology that has changed the face of B2B exchange relationships. This paper considers the Internet and its inherent ability to support value creation within business-to-business relationships. The paper outlines four key characteristics that describe the Internet's attributes relative to value creation and proposes that the Internet's effect depends upon properly aligning these attributes with the economic and relational factors driving value creation. In particular, the paper proposes a contextual relationship between Internet usage, joint action, and the resources shared between exchange partners.     

The Internetalisation of information,knowledge, and interaction components of the firm's internationalisation process

Abstract

Transcending traditional national borders, the Internet is an evolving technology that has opened up many new international market opportunities. However, ambiguity remains, with limited research and understanding of how the Internet influences the firm's internationalisation-process components. As a consequence, there has been a call for further investigation of the phenomenon. Thus the purpose of this study was to investigate the Internet's impact on internationalisation-process components, specifically, information availability, information usage, and interactive communication, with international market growth. Analysis was undertaken using structural equation modelling. Findings highlight the positive mediating impact of the Internet on information availability and usage, with the international market growth of the firm.     

Online shopping among Chinese consumers: an exploratory investigation of demographics and value orientation

The current study examined the relationship between Chinese consumers' personal value orientations and their Internet usage and online shopping behaviour. The study was based on responses from a sample of 1620 respondents in five cities in China. Based on Schwartz's value structure, four value orientations were identified and named as ‘openness to change orientation’, ‘self‐enhancement orientation’, ‘conservation orientation’ and ‘self‐transcendence orientation.’ Logistic regression analysis was used to investigate the relationship between respondents' demographics, socio‐economic characteristics, value orientations and their Internet usage and online shopping behaviour. Also, a structural equation modelling analysis was employed. ‘Openness to change orientation’ and ‘self‐enhancement orientation’ were found to have direct or indirect positive effect on respondents' online shopping behaviour; whereas ‘conservation orientation’ and ‘self‐transcendence orientation’ were not significant in the equation estimation.     

Who's behind the screen? Segmenting social venture consumers through social media usage

With the growing popularity of social media as a tool for marketing social causes and the increasing significance of social ventures in today's market economy, it is important to understand the heterogeneous nature of social venture consumers in regard to their social media usage. Using cluster analysis of survey responses from 305 consumers of various social ventures, four distinct segments of consumers who support social ventures were identified – social observers, active contributors, social connectors, and moderate contributors – based on three dimensions of social media site usage: creating content, connecting with others, and control over the user experience. Further analysis of survey results revealed that these four segments of consumers show significant differences in supporting behaviors     

Two-step Influence Tactics: Exploring How Coercive Power is Exercised in Channel Triads

ABSTRACT

Purpose – Most research on the power issue has taken a dyadic view, implicitly assuming that power is employed directly and successfully on one target via a single route without stakeholders. When such a direct approach is unsuccessful or impractical, however, power holders may influence their targets via third parties. This study, from a triadic point of view, details how the coercive power is exercised through two-step maneuvers, and what differences are between power exercise in the dyads and that in the triads. Methodology/Approach – In-depth interviews were conducted with four suppliers in different industry settings.

Findings – Four types of two-step influence tactics are identified on the basis of strategic nature (covert/overt) and the pathways of influence (single/multiple). Differing from the power usage in a dyad without stakeholders, the power usage with the stakeholders in a triad was found to (1) reduce the levels of dependence on the target firm; (2) alleviate the conflicts and retaliation; (3) alter the power direction and influence strength; and (4) add more rooms for the power holder to manipulate the influence tactics. Research implications – The findings of this study expand the understanding of an under-researched dimension of coercive power usage and leverage by connecting the different stakeholders in the channel triads. The four coercive power tactics and their drivers show how the shift of power source from a dyad to a triad impacts on the target firm’s behavior and overall network performance. Practical implications – The findings also provide some guidance for practitioners, so that they may use the two-step coercive influence tactics more appropriately based on the different strategic nature and pathways of influence in the marketing channels. Originality/Value – This study contributes to the literature by providing a conceptual framework and variables for analyzing the two-step power tactics in the channel triads.     

Strategic orientation and firm risk

Entrepreneurial orientation (EO) and market orientation (MO) have received substantial conceptual and empirical attention in the marketing and management literature and both orientations have consistently been linked to stronger financial performance. Yet the way in which market-oriented firms seek to achieve superior rents is substantively different from that of entrepreneurially oriented firms which could lead to differential impacts of EO and MO on firm risk. In this study, the authors employ a text mining technique to assess firms' EO and MO and examine the impact of these two strategic orientations on shareholder risk outcomes. The results show that while EO increases idiosyncratic risk, MO decreases it. However, only EO decreases systematic risk. Overall, the results of this study demonstrate that a firm's decisions regarding strategic orientation should be examined in light of both likely risks and returns in order to make appropriate resource allocation decisions.     

The impact of user perceptions of AR on purchase intention of location-based AR navigation systems

As new AR supported products such as location-based AR navigation systems become available in the consumer market, it is particularly important to understand how user perceptions of AR can be optimized to enhance customer satisfaction and increase purchase intention of these products. However, little research has addressed this gap in the literature so far. Therefore, this study developed a theoretical framework including user perceptions of AR, experience, satisfaction and purchase intention employing experience economy theory. This study's main theoretical contribution is that three user perceptions of AR – spatial ability (sensory domain), sense of presence (feeling domain), and conceptual understanding (cognitive domain) – were found to be key antecedents of consumers' intention to purchase location-based AR navigation systems through the mediation of educational, entertainment, aesthetic, and escape experience. The findings have important implications for future development of location-based AR systems.     

The Impact of Personality Variables,Prior Experience,and Training on Sales Agents' Internet Utilization and Performance

ABSTRACT

Emerging literature on the impact of the Internet on business-to-business (B2B) marketing has primarily focused on examining this issue from the perspective of manufacturers and buyers. This study focuses on the sales agent, a third prominent actor in B2B markets, and tests a conceptual model that relates a sales agent's personality, demographic, and user-situational constructs to that sales agent's Internet utilization for selling activities. Further, the model tested in this study relates a sales agent's Internet utilization to perceived sales performance. Findings in this study indicate that internal locus of control, learning orientation, and sales related Internet training relate positively to a sales agent's Internet utilization, and that a sales agent's age relates negatively to Internet utilization. Further, the results support a positive relationship between a sales agent's Internet utilization and sales performance. This study emphasizes that the Internet can be a productive tool for sales agents. The implications of the results of this study for sales agents with respect to training and recruitment are discussed and avenues for future research are suggested.     

Innovation in retail internationalisation: Tesco in the USA

This paper examines the market entry of the UK's largest retailer (Tesco) into the USA. Tesco's launch of a new brand – Fresh & Easy Neighborhood Markets – in virgin territory is a bold move, notwithstanding the firm's considerable success with its overseas investment strategy (which within ten years has resulted in more than 50% of the firm's operating space being outside its ‘home’ market). The paper contextualises the study by taking a historical view of innovation in the retail industry, which reveals that generally - and certainly for the most part of the twentieth century – innovations have dominantly flowed from the US to the UK. The paper suggests that Tesco's US experiment is unusual both in terms of the innovatory aspects of its market entry and the reversal in that conventional direction of knowledge transfer. The Fresh & Easy story is then examined in terms of ten ‘dimensions of innovation’ involved in the market entry. The paper concludes by drawing out from these ‘dimensions of innovation’ a number of important issues for management scholarship raised by the study, stressing the need to incorporate insights from a wider social science literature.     

Export Market Participation,Investments in R&D and Worker Training,and the Evolution of Firm Productivity

This paper uses micro panel data for firms in the Taiwanese electronics industry in 1986, 1991 and 1996 to investigate a firm's decision to invest in two sources of knowledge – participation in the export market and investments in R&D and/or worker training – and assess their effect on the firm's future productivity. The firm's decisions to export and invest in R&D and/or worker training are modelled with a bivariate probit model that recognises the interdependence of the decisions. The effect of these investments on the firm's future productivity trajectory is then modelled while controlling for the selection bias introduced by endo‐genous firm exit. The findings indicate a significant interaction effect between exporting and R&D investments and future productivity, after controlling for size, age and current productivity. Firms that undertake both investment activities have significantly higher future productivity than firms that do one or neither. In addition, these firms are more likely to continue investing in these activities leading to further productivity gains. These findings are consistent with the hypothesis that export experience is an important source of productivity growth for Taiwanese firms and that firm investments in R&D and worker training facilitate their ability to benefit from their exposure to the export market.     

Performance or learning goal orientation: Implications for business performance

An organization's long-term effectiveness and efficiency reflect its learning goal or performance goal orientation. Goal orientation concepts originate in psychology of achievement motivation theory. Goal orientations drive the development and deployment of organizational capabilities, such as market orientation and innovativeness to achieve organizational performance outcomes. Extant research pays little attention to whether or not industry type (services or manufacturing) operates as a significant moderating factor in the relationships among an organization's capabilities, goal orientation, and performance outcomes. This study addresses this gap. The study results indicate a significant moderating effect of industry type on relationship between goal orientation and performance but not between goal orientation and either market orientation or innovativeness. Goal orientation appears to be more important for service industries than for manufacturing.     

A Conceptual Model of Political Market Orientation

SUMMARY

This article proposes eight constructs of a conceptual model of political market orientation, taking inspiration from the business and political marketing literature. Four of the constructs are ‘behavioural’ in that they aim to describe the process of how information flows through the organisation. The remaining four constructs are attitudinal, designed to capture the awareness of members to the activities and importance of stakeholder groups in society, both internal and external to the organisation. The model not only allows the level of a party's political market orientation to be assessed, but also aids the party in making a context-specific decision with regard to the reallocation–or not–of party resources in order to attain the party's long-term objectives.     

Market Orientation and Organizational Learning Capabilities

The platform of contemporary marketing thought is founded upon the marketing concept. While there has been much debate about the precise nature of this concept, related discussion concerning its manifestation, in the form of a firm's market orientation, has developed to suggest that it is a feature exhibited by organizations possessing superior skills in understanding and satisfying customer needs. Despite the favourable externalities likely to accrue to an organization that is market oriented, it has been claimed that for a firm to achieve its full potential to learn about the marketplace, instilling a market orientation is only a first principle. While market orientation provides the norms for responding to the marketplace, this needs to be complemented by appropriate mechanisms and processes for higher-order learning to occur. This article examines such a conceptual argument and empirically investigates the relationship between two key constructs: market orientation and organizational learning capabilities. Data were generated from a survey of medium and large industrial firms and five dimensions of organizational learning capability items are tested against two different groups of firms in terms of their degree of market orientation. As contrasted with low market orientation firms, organizations characterized by high levels of market orientation perceived greater organizational learning capability with regard to the dimensions of strategic awareness, operational flexibility, strategic development processes and managerial skills. Discussion is given to these findings and implications are drawn for business executives and future research.     

Base-of-the-Pyramid (BOP) orientation and firm performance: A strategy tripod view and evidence from China

The Bottom of Pyramid (BOP) market in developing countries represents an enormous market opportunity. Serving the BOP segment, however, incurs significant risks and costs because BOP consumers are deprived of income and literacy. It remains unclear whether or not serving this market segment would benefit firm performance. Based on related literature, we propose a new construct – BOP orientation, and examine its impact on firm performance and an operating mechanism of such effect – the mediating role of bricolage innovation strategy that emphasizes recombination of existing resources to solve the unique problems faced by BOP consumers. Drawing on the strategy tripod view, we also investigate the contingency effects of both institutional and industry environments in an emerging economy. We collected survey data to test the conceptual framework from 238 firms in China, the world’s second largest BOP market. The results support a positive relationship between BOP orientation and firm performance and confirm that the performance impact of BOP orientation is channeled through bricolage innovation strategy. Further, we find that the effect of BOP orientation is contingent on both the institutional factors and the industry conditions. Specifically, government support strengthens while legal inefficiency weakens this effect; competitive intensity strengthens the effect, while technological uncertainty has no moderating role on this relationship. Contributions to extant literature and useful guidelines for firms of our research are discussed.     

The influence of customer loyalty on small island economies: an empirical and exploratory study

There is growing consensus that companies' long-term success is reliant on building and sustaining strong customer relationships. This study explores the antecedents of loyalty in business to business (B2Bs) using Guernsey's telecommunication industry as a case study. It examines how these influence customer loyalty orientation and factors that help service providers improve loyalty rates. Extant literature pays little attention to the antecedents of loyalty in small island economies. Prior research focuses on cultural, environmental and macro-economic issues. Drawing on Dick and Basu's (Customer loyalty: Toward an integrated conceptual framework. Journal of the Academy of Marketing Science, 22(Spring), 99–113, 1994) loyalty model, this research explores loyalty antecedents that are cognisant of distinct market conditions that can impact customer loyalty within the telecommunications sector of a small island economy. It seeks to advance understanding of loyalty in B2B relationships in this context and identify factors that contribute towards converting passively loyal customers to being actively loyal customers.     

An exploration of inter-functional integration in the new service development process

This article explores the nature of inter-functional integration in the new service development process through a detailed study of two new internal ICT services developed at one of Europe's largest service providers: Consignia, the UK postal service. The study develops a conceptual framework, incorporating dimensions of process, context and outcomes, to inform the analysis. The empirical findings reveal that the level and timing of appropriate functional stakeholders, influence of relationships with external stakeholders, formalisation and ownership of authority, shared understanding of goals and the influence of shifting organisational contexts act as critical factors underlying the nature of inter-functional activities and outcomes. Managerial implications and future research directions are drawn.