The effects of perceived industry competitive intensity and marketing-related capabilities: Drivers of superior brand performance

Since the early 1990s the theoretical and practical issues associated with organizational capabilities have been a major research focus in marketing. However, there has been little focus simultaneously on industry environment and internal competitive capability development. A manager's perception of his/her industry environment has the potential to impact the firm's marketing-related capability development through their strategic responses to their perception of the environment. This paper advocates that managers (i.e., firms) perceiving their industry environment as turbulent will develop superior market learning and marketing capabilities. Market learning will assist in the process of building superior marketing capabilities. Both capabilities lead to higher brand performance. To explore these issues a study was designed to measure perceived industry competitive intensity, market learning and marketing capabilities. Data were gathered from senior managers of commercial firms and the results largely support the hypothesized theoretical relationship that industry competitive intensity influences market learning activity and marketing capability development. Interestingly, the study findings suggest that market learning impacts brand performance through marketing capability. The findings significantly contribute to the debate on the influence of the competitive environment on a firm's internal capability development which suggests the need for further research to examine the industry competitive intensity-internal capabilities-firm performance relationship.     

Antecedents of functional integration during new product development: The purchasing–marketing link

In response to different economic and business trends, companies are becoming increasingly dependent on external resources and capabilities as they seek to cater for an ever more complex and challenging demand. Such dependence has led an important group of scholars to draw attention to the inevitable integration of the purchasing and marketing functions. We stress here the need for such integration during new product development, and seek the mechanisms that may promote purchasing–marketing integration. Accordingly, this study describes two essential components underlying the concept of purchasing–marketing integration, and tests the effect of different integration mechanisms gathered from the literature on these two components. The model is tested on a sample of 141 Spanish industrial companies. Our results show that each one of these integration mechanisms varies in its effectiveness in promoting each key component of purchasing–marketing integration. Taking these asymmetric effects into account is crucial for selecting the appropriate purchasing and marketing integration devices within companies.     

A hub-and-spoke model for multi-dimensional integration of green marketing and sustainable supply chain management

Since the concept of sustainability was transformed into business mainstream, both sustainable supply chain management and green marketing have become key topics of academic research and managerial practices. Great advances have been made in the two areas in parallel. It has been recognized that green marketing and sustainable supply chain management should be seamlessly integrated so that green customer's needs can be better met by the supply chain capabilities. Existing research has explored point-to-point integration approach. This paper proposes a new hub-and-spoke integration model to integrate green marketing and sustainable supply chain management from six dimensions: product, promotion, planning, process, people and project (called the 6Ps). Empirical study has been undertaken with industries to test the 6Ps integration model. Results from the empirical study on integration dimensions, integration strategies, and drivers and obstacles for multi-dimensional integration are presented together with managerial implications. The new integration model allows the flows of resources such as information, materials and funds between green marketing and sustainable supply chain management through multiple direct pathways. It has the potential to achieve better overall business performance against the triple bottom line objectives.     

Market orientation,marketing capabilities,and firm performance

Drawing on traditional resource‐based theory and its recent dynamic capabilities theory extensions, we examine both the possession of a market orientation and the marketing capabilities through which resources are deployed into the marketplace as drivers of firm performance in a cross‐industry sample. Our findings indicate that market orientation and marketing capabilities are complementary assets that contribute to superior firm performance. We also find that market orientation has a direct effect on firms' return on assets (ROA), and that marketing capabilities directly impact both ROA and perceived firm performance. Copyright © 2009 John Wiley & Sons, Ltd.     

Exploring the characteristics of the market-driven firms and antecedents to sustained competitive advantage

During the last few decades, identifying and examining the characteristics of market-driven firms have been a dominant theme in strategic marketing research. It has been argued that market-driven firms are superior in their market sensing and customer linking capabilities, enabling market-driven firms to outperform their competitors. This paper reports the findings of a study that examines the role market-focused learning capability and marketing capability in innovation-based competitive strategy on sustainable competitive advantage. The findings indicate that entrepreneurship is an important factor in sustained competitive advantage (SCA) and while market-focused learning capability leads to higher degrees of innovation, marketing capability enables SCA.     

Winning through innovation and marketing: Lessons from Australia and Vietnam

We examine the role of innovation and marketing, two functional capabilities that have the capacity to play a major role in creating superior marketplace performance in firms. Our study of the two capabilities and firms' marketplace performance also takes into account the contribution of entrepreneurial orientation (EO) and market orientation (MO) to our focal functional capabilities and marketplace performance. The results of a study of firms in Australia and Vietnam show innovation capability, marketing capability mediate the effects of the firm's MO on its marketplace performance. The results also show that the interaction of innovation and marketing capabilities significantly influences firms' marketplace performance more than they do individually. Finally, our results show that MO partially mediates the relationship between EO and innovation and marketing capabilities.     

Achieving new product success via the synchronization of exploration and exploitation across multiple levels and functional areas

While ambidexterity has been identified as a critical prerequisite for new product success, synchronizing exploration and exploitation in practice represents a multifaceted enigma. Ambidexterity is not in reality limited to a single organizational level, or a specific functional area. Firms become ambidextrous when corporate-level exploratory and exploitative strategies interact with operational-level exploratory and exploitative capabilities across multiple functional areas. Data from a sample of technology-intensive industrial firms using a multi-informant design shows that operational-level exploratory and exploitative product innovation and marketing capabilities allow firms to implement corporate-level exploratory and exploitative strategies in the context of new product development (NPD). Further, the findings reveal that the integration of exploratory product innovation–exploratory marketing and exploitative product innovation–exploitative marketing is significant for the implementation of exploratory and exploitative strategies over deploying each capability in isolation. Finally, we show that the implementation of exploratory and exploitative strategies drives new product success through creating distinct positional advantages to customers in the form of both differentiation and cost efficiency. These positional advantages help to better explain the effects of exploratory and exploitative capabilities on new product market performance.     

The digital marketing capabilities gap

Over the past two decades, digitalization has revolutionized not only consumer marketing but also industrial marketing. Both industrial marketing scholars and industrial marketers seek insights to understand how our knowledge and practice of digital marketing has been structured and configured. To address this gap, we adopt the resource-based perspective as an organizing framework and systematically review 129 articles spanning two decades of research to identify different digital marketing capabilities in industrial firms. From this analysis, we identify four themes: channels, social media, digital relationships, and digital technologies. We then stress-test this knowledge with managerial practices by conducting an online survey of 169 managers, designed to establish the repertoire of current and future marketing capability needs of industrial firms. Herein, we identify two marketing capabilities gaps: the practice gap—which identifies the deficit between managers' ‘current’ practices and their ‘ideal’ digital marketing capabilities; and, the knowledge gap—which demonstrates a significant divide between the digital marketing transformations in industrial firms and the extant scholarly knowledge that underpins this. Based on these results, we build an agenda for future research on digital marketing capabilities.     

The relationship between marketing agility and financial performance under different levels of market turbulence

Marketing agility is an example of dynamic capability that has significant influence on ordinary capabilities leading to superior financial performance. This makes it of interest to marketing managers. Yet the way in which this capability aligns with turbulent market environments to simultaneously influence ordinary capabilities and performance has not been adequately examined and empirically tested. This study seeks to close this gap by positing that marketing agility has both direct and indirect (through innovation capability which is an ordinary capability) impacts on financial performance. However, these relationships are moderated by market turbulence to yield both mediated moderation and moderated mediation effects. The study was undertaken in the Chinese food-processing industry where a sample of 518 companies participated. This provides an opportunity to validate theory developed in the western economies and to generalize some previous findings. Contrary to received literature we found that the impact of innovation capability on financial performance is stronger under low market turbulence; and that market turbulence moderates the indirect relationship between marketing agility and financial performance. The indirect effect is stronger when market turbulence is low than when it is high. Implications for managers and academia are discussed and limitations of the study are pointed out.     

Product‐market strategy and the marketing capabilities of the firm: impact on market effectiveness and cash flow performance

We report on two studies (a single and a multi‐industry) that empirically investigate a nomological network of relationships between strategic business unit product‐market strategy (differentiation, cost‐focus, and product‐market scope), marketing capabilities (architectural and specialized capabilities, as well as their integration), and business unit performance (market effectiveness and subsequent one‐year objective cash flow), along with a series of controls. Addressing important lacunae in the resource‐based view our main research objective is to augment understanding of how critical firm‐level marketing capabilities enable the realization of strategy, thus, further advancing both the resource‐based view and more recent capabilities theorizing. Specifically, we test seven hypotheses and find strong evidence that both architectural and specialized marketing capabilities, and their integration, positively mediate the product‐market strategy and derived business unit performance relationship. In contrast to many extant studies, both survey and objectively measured data are combined, and because the secondary data collected contains both resource‐level (input) data and subsequent one‐year financial data, a higher level of confidence may be attributable to our findings. Copyright © 2009 John Wiley & Sons, Ltd.     

The impacts of marketing and operations capabilities on financial performance in the UK retail sector: A resource-based perspective

Drawing upon the resource-based view (RBV) of the firm, this study investigates the relationships among marketing capability, operations capability, and financial performance. Using archival data of 186 retail firms in the UK, we find that that marketing capability has a significant impact on operations capability, and that operations capability is significantly and positively related to retail efficiency. The results also suggest that operations capability fully mediates the relationship between marketing capability and financial performance. The findings of this study provide practical insights for practicing managers to consider when developing functional capabilities in order to achieve superior financial performance.     

Interaction Orientation and Product Development Performance for Taiwanese Electronics Firms: The Mediating Role of Market‐Relating Capabilities

While academics and practitioners are increasingly aware of the value of including the customer in new product development (NPD), processes for doing so effectively remain unclear. Therefore, this study explores the process through which a firm's interaction orientation (the ability to effectively interact with customers) influences product development performance. Drawing on the resource‐based view, this study develops a research model in which two market‐relating capabilities—market‐linking and marketing capabilities—mediate the effect of interaction orientation on product development performance. The validity of this model is examined by analyzing primary data gathered from 167 Taiwanese electronics companies. The model results provide support for a process link between interaction orientation, market‐relating capabilities, and product development performance, such that a firm's capabilities enable the conversion of customer‐based resources into productive new product outcomes. More specifically, the interaction orientation–product development speed relationship is mediated by both marketing and market‐linking capabilities, while the interaction orientation–product innovativeness relationship is partially mediated by marketing capability. That is, interaction orientation has indirect effects on product innovativeness and product development speed by strengthening both marketing and market‐linking capabilities that in turn improve product development performance. In addition, the results suggest that a firm's interactive rationality moderates the relationship between interaction orientation and marketing capability. Overall, this study enhances our understanding of how firms achieve superior product development performance by developing effective customer interaction. The findings of this study provide important strategic insights into NPD.     

An integrated marketing capability benchmarking approach to dealer performance through parametric and nonparametric analyses

The role of marketing capabilities as a source of sustainable competitive advantage has been discussed previously in the marketing strategy field. Benchmarking, a well-known learning mechanism, is suggested as a tool to identify and improve the marketing capabilities of a firm. Despite its popularity as a theoretical concept, there is not much empirical evidence to support the view of benchmarking marketing capabilities as a route to guide managers' efforts in this direction. This paper contributes to the three perspectives in the literature that support the view that benchmarking marketing capabilities can offer a basis for sustainable competitive advantage of the firm through both a conceptual and integrated benchmarking model. They are empirically analyzed using stochastic frontier and data envelopment analysis methods based on four-year data set of forty-five dealers of a leading business-to-business supplier. The results indicate the importance of competent salespeople and building a long-term relationship in enhancing dealer performance. In addition, they reinforce a recipe of how marketing capabilities can be benchmarked to achieve sustainable competitive advantage. Discussions and implications for managers are also presented.     

Insecure Advantage? Markets for Technology and the Value of Resources for Entrepreneurial Ventures

We study how the impact of capabilities for performance is contingent upon the environment. Using a novel dataset of information security start‐ups, we study how markets for technology change the relative impact of technology and marketing capabilities on performance. Since internal technical effort enables firms to generate technology inputs instead of acquiring them from the market (substitute), a greater supply of technology diminishes the importance of technical ability as a source of competitive advantage. Moreover, since marketing capability complements technology inputs, a greater supply of technology enhances the impact of marketing capability on performance. Copyright © 2011 John Wiley & Sons, Ltd.     

Communicating firm competencies: Marketing as different levels of translation

Recently, the notion of competence-based marketing and communication has been discussed as a way to avoid competing on price and to increase imitation barriers. This paper contributes to the discussion with the development of a model of firm capabilities and an understanding of when to use competence-based communication. It is argued that all market communication is competence-based but the content of communication and the marketing capability changes along the different waves of market orientation. Therewith, marketing is seen as translating firm competencies into customer language.     

Strategic relationships between boundary-spanning functions: Aligning customer relationship management with supplier relationship management

This review focuses on the potential impact of enhanced strategic relationships between the boundary-spanning functions in supplier organizations. Specifically, the concern is with alignment between the organizational groups managing: marketing, sales and strategic account management; purchasing and supply strategy; and, collaborations and external partnerships. The topic is framed by the organizational evolution being driven by market change, and the search for superior innovation capabilities and business agility. These changes bring new challenges in cross-boundary integration and managing complex market networks. The logic is that strategic external relationships (with customers, supplier and partners) should be mirrored in strategic internal relationships (between the functions with lead responsibilities for managing relationships with customers, supplier and partners). Approaches to enhancing this capability include process management, internal partnering strategies and internal marketing activities. The discussion identifies a number of implications for practice and new research directions.     

Social Capital as a Microlevel Origin of Organizational Capabilities

The microlevel concept of social capital has received significant attention in management and sociological research but has not yet been empirically associated with the development of organizational capabilities. The major purpose of this paper is to investigate the relationship of social capital with marketing and research and development (R&D) capability and to explore how the environmental context moderates the social capital–organizational capability link. It is suggested that top management's social capital provides a firm with important information and control benefits that facilitate effective access to the knowledge and resources necessary for building superior organizational capabilities. In addition, we identify the role of two important environmental factors influencing the social capital–organizational capability link: technological turbulence and competitive intensity. The strength of the relationship between social capital and organizational capabilities is proposed to vary depending on the level of these two environmental characteristics. This study conceptualizes and operationalizes social capital as a multidimensional construct reflected by the structural dimension of tie strength, the relational dimension of trust, and the cognitive dimension of solidarity. Survey and archival data on 280 firms from various industries are analyzed using structural equation modeling. Empirical support for the proposed three‐dimensional structure of social capital is found. Results further indicate that social capital is a significant antecedent to both marketing and R&D capability, which in turn significantly affect firm performance. While a positive relationship between social capital and organizational capabilities is supported in general, the strength of this relationship depends on the environmental context the firm is embedded in. The positive effect of social capital on marketing capability increases in environments with high technological turbulence and competitive intensity; the opposite holds for R&D capability. This research contributes to the resource‐based view by introducing social capital as an important microlevel factor promoting the development of organizational capabilities. By identifying and evaluating two important environmental contingencies, our study also decreases some of the ambiguity surrounding the effectiveness of antecedents to organizational capabilities. The findings further help practitioners decide under what circumstances investing in top‐managers' social capital provides an effective means for achieving superior performance through enhanced organizational capabilities. This should have an important bearing on issues such as management training and incentives as well as on hiring policies.     

Lone wolf or social monkey? The role of marketing outsourcing in the development of second-order marketing competences

Marketing outsourcing has been increasing for decades due to its well-known benefits, even though the development of dynamic marketing capabilities can be severely damaged as a result. This study focuses on the conditions under which marketing outsourcing favors organizational learning. We found that the relationship between marketing outsourcing and second-order marketing competences resembles an inverted U curve. The first-order marketing competences and absorptive capacity positively moderate this relationship both individually and jointly, by shifting the U-curve to the right. Thus, any firm has an optimum level of beneficial outsourcing that depends on how skilled it is in the outsourced marketing function and its ability to assimilate and apply new knowledge. Our findings provide learning-related criteria for the outsourcing decision. Firms that will consider them can develop a knowledge-based competitive advantage while still enjoying the benefits of outsourcing. Against the common wisdom, we show that the development of new marketing capabilities is an equally challenging task for marketing functions with both low and high knowledge intensity.     

Antecedents and consequences of new venture growth strategy: An empirical study in China

Although current literature on new venture growth has focused on why new ventures grow, relatively less attention has been paid to how that growth is occurring. This article adopts the resource-based view to investigate the antecedents and consequences of new venture growth strategy in an emerging economy context. We identify three generic growth patterns of Chinese high-tech new ventures—organic growth, partnership growth and acquisition growth, based on 252 completed questionnaires. Consideration has been given to identify respective resources and capabilities associated with different growth strategies. Technological capabilities, strong and weak network ties, marketing capabilities and financial resources are found to have different effects on different new venture growth strategies. In addition, the growth strategies show differentiated effects on performance in terms of survival, competitive advantages and profits. Research and practical implications of new venture growth strategies and performance in China are also discussed in the paper.     

Effects of inter-organizational compatibility on supply chain capabilities: Exploring the mediating role of inter-organizational information systems (IOIS) integration

Growing globalization and environmental uncertainty have increased the challenges managers face in delivering services or products to the customer. Integration of information systems across partnering organizations has become the backbone of supply chain management, as amalgamation facilitates the sharing of information required to enhance organizational flexibility and responsiveness while minimizing risk and inventory costs. Using data from the Australian retailing sectors, this study investigates the mediating role of inter-organizational information system (IOIS) integration on the relationships between inter-organizational compatibility and supply chain capabilities. The results indicate that inter-organizational compatibility of technical, strategic, and cultural inter-organizational dimensions facilitate IOIS integration and supply chain capabilities. To maximize benefits for all chain members, IOIS integration needs to be embedded in the strategies and goals of partnering organizations. Business-to-business and industrial marketing managers need to be aware that IOIS integration processes require support of top managers of the partnering organizations and should be embedded in the organizations' strategic goals.