Market Orientation in Vertical Business Networks

Abstract

This research addresses three questions: (1) Why are some business network firms more market orientated than others? (2) What effect does the environmental uncertainty have on the network performance impact of market orientation activities performed by a network firm? (3) Does network embeddedness influence the effectiveness of a firm's market orientation activities? The findings from a study on a vertical grocery network suggest that the performance impact of market orientation activities depends on the network identity of the network firm. Network embeddedness of a network firm is found to enhance this performance link. Finally, uncertain market environments favor down-stream allocation of market orientation activities in our sample.     

Impact of market orientation on firm’s customer-based performance: the moderating role of employee orientation

ABSTRACT

In this paper, we examine the influence of employee orientation (EO) on converting constituent dimensions of market orientation (MO) into customer-based performance (CBP) and consider the robustness of these relationships in the context of firm age and size. Based on a sample of 410 mid-to-senior-level managers working in UK service industries, we find that all three dimensions of MO positively influence CBP. While highlighting the utility of employing a multidimensional approach to evaluate the customer-based outcome of MO implementation we highlight the nuanced role of EO in strengthening the MO–performance relationship and emphasise the crucial role employees play in implementing different strategic orientations in a perceivable way to customers.     

Strategic hybrid orientation between market orientation and brand orientation: guiding principles

Strategic orientations underpin the firm’s managerial decisions and influence its performance. Firms can combine multiple strategic orientations to achieve superior performance. Market orientation and brand orientation are well-developed, separate, strategic approaches. A 2013 study conceptually proposed a strategic hybrid orientation comprising two types: (a) market and brand orientation and (b) brand and market orientation. The current study is qualitative, using small-to-medium enterprises to investigate strategic hybrid orientations. Through propositions, the paper explains the theory and processes underlying the two hybrid orientation types. The propositions form the guiding principles for the strategic management of the hybrid orientation. The implications for managerial practice show that quite different capabilities apply to the execution of each strategic hybrid type.     

Market or society? Dual orientations and the impact on innovativeness in media organizations

Shortening life cycles of products and new technologies make innovation a vital part of the long-term growth and survival of firms. Interestingly, media firms see themselves in a particular difficult position in innovation because traditional values such as public information access, good taste, information diversity, and social responsibility can be in conflict with the market success of certain new media products and services. This is also a key reason why there are public media firms in certain information markets in the first place. In this study, two different orientations in media organizations are studied simultaneously, namely “market orientation” and “social responsibility orientation” in relation to innovativeness. Based on a sample of 54 Dutch media organizations, we find that firms scoring high on both dimensions are not necessarily more or less innovative (indicating that innovations emerge in the whole orientation space). What is important for innovativeness is the degree to which professionals identify with the orientations of the firm. The broader implications of a more prominent role of social responsibility in NPD are discussed.     

Senior marketers’ insights into the challenges of social media implementation in large organisations: assessing generic and electronic orientation models as potential solutions

Abstract

The unique characteristics of social media (SM) have made it difficult to implement this tool within many large organisations. This paper seeks to identify the implementation challenges and evaluate alternative organisational orientations that may provide solutions. We aimed to reconcile theory with current practice by integrating the extant literature with data from three focus groups involving 27 senior marketing executives. The managerial discussions identified additional challenges to those previously discussed in the literature, which appear to result from SM’s unique characteristics. These include: interactivity, the integration of communication into distribution channels, collaborative media and information collection. Using both broad orientation models (market orientation and entrepreneurial orientation) and a specific digital orientation (e-marketing orientation), guidelines and research propositions for effective implementation are put forward.     

Relating strategic market orientation and market performance: role of customer value types

A service provider achieves competitive advantage by configuring appropriate strategic orientation and customer value type. This paper addresses three important issues: (i) which customer value type (economical, relational or technical) is important for bank customers? (ii) which strategic market orientation (customer or competitor) helps in achieving the desired value type? and (iii) which value type significantly predicts market performance? We propose that a strategic market orientation pursued by a firm shall influence the customer value it intends to offer so as to maximize the market performance. Using data collected from 538 bank customers, this study reveals that when there is a perfect match between strategic market orientation and value being perceived by its customers, a firm shall achieve strategy-value fit and realize optimal market outcomes in the form of customer satisfaction, acquisition, retention, cross-selling, and up-selling. Furthermore, a bank shall realize maximum level of market performance if it pursues both customer and competitor orientation and endeavors to deliver technical/functional value to its target customers. The paper concludes with managerial implications and future research directions.     

The moderating effect of brand orientation on inter-firm market orientation and performance

Abstract

While prior research has shown that market and brand orientation are key contributors to successful business performance, research to date has not fully explored how inter firm collaboration for these two key orientations can enhance business performance. The purpose of the paper is to investigate the relationship between inter-firm market and performance; to test for the moderating role of brand orientation in that relationship. A total of 169 completed pairs of surveys were collected of small and medium enterprises operating internationally in a variety of industries in Switzerland. The results show that inter-firm market and brand orientation are two antecedents of marketing and financial performance. The impact of inter-firm market on marketing and financial performance is significant when the brand orientation is favorable. This study extends previous research by examining the moderating role of brand orientation on inter firm market orientation, which is important, especially for firms wanting to increase their brand reputation by entering into partnerships with other firms. Further research is indicated, to identify the key moderators of the driving force of inter-firm market in relation to business performance and the reason why maintaining a strong brand presence is important in the international marketplace.     

Does market orientation pay off without brand orientation? A study of small business entrepreneurs

Market orientation and brand orientation are usually modelled as distinct antecedents of business performance, and the simultaneous performance effects of these orientations are empirically under-explored. Moreover, studies of market orientation and branding tend to focus on large corporations and the views of managers rather than the views of small business entrepreneurs. Addressing these research gaps, the current study explores market orientation and brand orientation by empirically testing their simultaneous effects on the business performance of small firms. Using primary data from 328 effective responses gathered from small business entrepreneurs, the study finds that market orientation improves the financial performance of a small firm only if it is implemented through brand orientation and eventually translated into brand performance. The results further indicate that older firms benefit more than younger firms from investing in branding, while younger firms benefit from paying attention to the actions of their rivals.     

When are strategic orientations beneficial for collaborative service innovation?

Despite the importance of collaborative innovation, the existing literature tends to be somewhat vague in identifying when strategic orientations are beneficial for service innovation between a focal firm and its business partners. The purpose of this study is to examine the relative effects of four strategic orientations (market, service, interaction, and learning) on collaborative service innovation performance, while considering the contextual factor of service offerings (basic installed base, maintenance, operational, and professional). Results based on survey data from 362 paired B2B firms show that learning orientation has the strongest effect on collaborative service innovation performance, and is the most effective for basic installed base services and maintenance services. In contrast, interaction orientation best supports those firms with operational services, while market and service orientations are more effective for professional services. Managers are advised to consider alternative strategic orientations individually aligned with service offerings to achieve desired collaborative service innovation outcomes.     

Brand compass: charting a course to improve firm performance

This study contributes to the internal brand management domain from a firm asset perspective. We argue brand compass is an inside-out identity-focused firm asset consisting of brand vision, brand commitment and shared brand understanding. We build a theoretical argument for examining brand compass together with two important outward focused orientations: market orientation and innovation orientation. Through structural equation modelling, within the context of retailing, the findings chart a course to improve firm performance.     

Entrepreneurial marketing: a comparative study

This paper uses a comparative study to explore entrepreneurial marketing orientation in small software technology firms, in relation to firm growth. Entrepreneurial Marketing (EM) acknowledges the interface between entrepreneurship, marketing and innovation and, pursuance of customer value. Researchers acknowledge that firms adopting other strategic orientations combined with a market orientation are more likely to outperform their competitors. Currently, there are few comparative studies of knowledge-intensive technology firms and no comparative cross-country studies, which consider firm growth and orientation from the EM perspective. This paper addresses these issues by using an entrepreneurial marketing orientation qualitative framework that consists of 15 dimensions, which allow investigation of entrepreneur and employee activities, attitudes and behaviors in such firms. Using a UK and US sample of firms, this research enables assessment of how and why entrepreneurial marketing orientation may lead to sustainable growth for firms in challenging markets and provides a comparison in two different country contexts.     

How strategic orientations influence the building of dynamic capability in emerging economies

Under the fierce pressures of the fast changing environments that characterize emerging economies, firms must develop dynamic capabilities to survive the competition. This study examines how strategic orientation helps build dynamic capability and its contingencies in China's emerging economy. A survey of 380 firms indicates strategic orientations are important drivers of adaptive capability, a key element of dynamic capabilities. The effectiveness of strategic orientations is contingent on market dynamics. In particular, when market demand becomes increasingly uncertain, customer orientation has a weaker impact, whereas technology orientation has a stronger effect on adaptive capability. As competition intensifies, both competitor and technology orientations build adaptive capability more effectively.     

The differential and synergistic effects of market orientation and entrepreneurial orientation on hotel ambidexterity

Innovation ambidexterity has surprisingly received limited attention in hospitality research. Using data from 101 Jordanian hotels analyzed with PLS structural equation modeling, this paper reports a double differential effect of two strategic orientations, market orientation (MO) and entrepreneurial orientation (EO), on hotel ambidexterity. On the one hand, EO (MO) has a stronger impact on exploratory (exploitative) than on exploitative (exploratory) innovation. On the other hand, EO has a stronger impact than MO on both innovation forms. Furthermore, the synergy between EO and MO has a positive impact on exploitative and exploratory innovation, both of which in turn enhance hotel performance.     

Team and organizational resources, strategic orientations, and firm performance in a transitional economy

Firms in transitional economies are learning to develop strategies to exploit new market opportunities though bounded by their lack of market experience and resources as well as institutional and cultural heritage. This paper examines the managerial orientations of top managers in the transitional economy of China by focusing on a firm's team and organizational resources. Specifically, the following antecedents motivate a firm to put more emphases on strategic orientations: the firm has an effective top management team, strong managerial competences, and when the firm has ample endowment of slack resources, social network, and support from the institutional environment. Empirical results support that team orientation, managerial competence, social network, and local institutional support are instrumental in developing market-focused strategic orientations. In addition, strategic orientations with heavy emphases on overall low costs and product innovation relate to higher firm performance.     

Strategic orientation and new product performance: The roles of technological capability

Although prior research has examined the linkage between strategic orientation and new product performance, existing empirical evidence suggests exploration of the effects of a firm's internal factors on this linkage is required. This study aims to fill the marketing literature gap by addressing how technological capability moderates the strategic orientation‐new product performance relationship. This study measures new product performance as a two‐dimensional construct to avoid the oversimplified bias. Research hypotheses are tested using a sample of 121 information system product projects and a hierarchical regression approach is utilized. Results show that (a) technological capability strengthens the market orientation‐performance relationship and (b) technological capability affects the financial performance effects of market and technology orientations via market performance. Copyright © 2014 ASAC. Published by John Wiley & Sons, Ltd.     

Market orientation in franchise networks: a contrast analysis of franchisors and franchisees views

Market orientation is considered as key to organizational survival and performance. In inter-firm settings, previous research indicates that it contributes to the overall performance of marketing channels. This research note investigates the perception of market orientation in franchise networks. Based on a dyadic multi-sectorial sample of 27 franchisors and 720 of their franchisees, the study examines how franchisors and franchisees perceive market orientation and to what extent their perceptions are concordant views. The underlying hypothesis is that a common view of the network orientation facilitates co-ordination and eventually performance. Results indicate that although the spirit of market orientation may be partially shared within the franchise channel, its consequences in terms of performance are not uniform.     

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.     

The dramatic breakdown of the market orientation concept in the pharmaceutical industry: lessons from Vioxx

In this article we present an in-depth case study to better understand the underlying market orientation concept in relation to bringing new technologies to the marketplace. We use the case history of the anti-arthritis drug Vioxx, developed and marketed by the company Merck & Co. Inc that allegedly killed thousands of customers. The case shows how market orientation can take shape and how the key components may form an explosive cocktail prone to problematic behaviour rather than a synergistic set of orientations that creates value for customers. From the data covering 20 years, it is clear that a consumer orientation and competitor orientation, for example, are difficult to internalise and balance by employees. A competitive orientation seems to lead to tunnel vision regarding profit and market share outcomes. Implications for the fundamental market orientation concept, innovation management, together with management challenges are discussed.     

How do alternative strategic orientations influence social media performance?

Increasingly organisations are using social media due to its advantages over traditional media however, its successful implementation has been problematic. To address this issue this study drew from the organisational orientation literature to examine alternate frameworks for implementation. Survey data were obtained from senior marketers from various Australian industries and structural equation modelling was used to test the hypothesised relationships. The study identified the components of alternate strategic orientations which were positively or negatively related to social media performance. The contribution of the study is to identify how the different emphasis within market, entrepreneurial and e-marketing orientations impact social media performance in terms of customer retention and customer acquisition. Implications for theory and practice are provided. Finally, research limitations and future research suggestions are presented.     

Assessing Value Co-Creation and New Product Success from Cultural Orientations and Relationship Marketing Perspectives

This study's main objective was to assess value co-creation and new product success among small and medium enterprises (SMEs) in Indonesia by incorporating cultural orientations and relationship marketing perspectives. The samples were purposely selected in two sectors: handcraft and food and drink. They were approached through a door-to-door distribution of the questionnaires. The findings indicated that relationship quality can enhance value co-creation and new product success when SMEs have a favorable combination of learning, market, and entrepreneurial orientations. However, this study suggests that SMEs do not utilize their relationships as arenas for learning and learning orientation can affect relationship quality only when it is supported by the other orientations.