Abstract
The increasingly tight competition has caused problems for small and medium enterprises (SMEs) in increasing their marketing performance. During the last few years, the marketing performance of SMEs operating in the Project woodcraft industry sector in the Badung Bali has moved downwards. The goal of this research is to develop knowledge in the fields of Strategic Management, specifically regarding product innovation to achieve a competitive advantage in an attempt to improve internationalization and marketing performance. The population in this research is all of the SMEs operating in the woodcraft industry sector and is based in Badung Bali. The sample size in this research is determined based on Slovin's formula and the total includes 100 units of SME operating in the woodcraft industry. The method used is the quantitative approach, which examines the role of competitive advantage in mediating the influence of product innovation on internationalization and marketing performance. Based on the research results, product innovation has a positive and significant influence on both, competitive advantage and internationalization. Product innovation and competitive advantage have positive and significant influences on marketing performance. Competitive advantage has a positive and significant influence on internationalization. Meanwhile, it has been revealed that competitive advantage can mediate the influence of product innovation on marketing performance and competitive advantage can mediate the influence of product innovation on the internationalization of SME operating in the Project woodcraft industry sector in Badung Bali. Based on these findings, the project woodcraft industry SME in Badung Bali is advised to be more innovative in producing their products, so that there would be an increase in marketing performance in the international market. It is also recommended for subsequent researchers to add in other variables, such as product quality and market orientation, to enrich the information attained.
Highlights
Competition occurs in all business sectors including Small and Medium Enterprises (SMEs)
H7: Competitive advantage can significantly mediate the effect of product innovation on internationalization (2) The real level used in this study is 5 percent with critical areas, Z (0,05) = 1,96 (3) Criteria Testing
Product innovation has a positive and significant effect on competitive advantage and marketing performance. This shows that the SMEs of the wooden handicraft industry in Badung Bali who are innovating in the form of offering new products, developing new designs, and developing new raw materials, have been able to increase competitive advantage and marketing performance
Summary
Competition occurs in all business sectors including Small and Medium Enterprises (SMEs). Based on pre-research conducted on five SMEs of the woodcraft industry in Badung Bali, it was recognized that with increasingly intense competition pressure the internationalization activities and business marketing performance had begun to decline. This is caused by many factors other than competition from the external environment, from within the business itself there are obstacles, such as SMEs having difficulty innovating and having creativity, less competitiveness compared to large entrepreneurs, and difficulties in marketing products. The obstacles mentioned above certainly greatly affect the marketing performance and the internationalization process of SMEs in the project woodcraft industry in the Badung Bali. When a company succeeds in meeting market demand by providing unique products that are difficult to replicate, it can improve superior performance (Daiya et al, 2012)
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