Entrepreneurial marketing as a way for Chinese SMEs to operate effectively in a transition economy

Abstract

Entrepreneurial marketing is both a theoretical and practical construct at the interface between entrepreneurship and marketing, with a relatively long existence, but insufficiently developed in theoretical terms. Most evidence of effective EM practice is Western in nature. Little attempt has been made to explore entrepreneurial marketing in transition economies, such as China. This research builds on the limited work to date on the practical aspect of the role of EM in a transition economy, China. The findings of this research are generated from qualitative research through in-depth interviews and participant observation. To investigate the role of EM among Chinese SMEs, Morris et al. (2002)’s seven dimensions framework is applied. The findings show that all dimensions of EM have been internalised and applied effectively in marketing activities among Chinese SMEs with promising results. The results also confirm a positive link between the core EM elements (including networking, word of mouth marketing, creativity) and Chinese SMEs’ performance. EM provides Chinese SMEs with new opportunities in overcoming obstacles posed by certain limitations, such as constrains in business financing, underdeveloped free market, industry barriers, and so on. While traditional marketing is causal logic-based, EM decision-making tends to be effectual. Through using Sarasvathy (2009)’s principles of effectuation, this research assessed the part played by Chinese entrepreneurs in shaping a business venture. The findings show that all participant Chinese entrepreneurs had applied effectuation logic in their decision-making, especially when they first started their businesses. Chinese entrepreneurs display sufficient signs of effectuation reasoning and play an essential role in shaping a new business venture. The finding also confirms that all dimensions of EM and principles of effectuation are not independent; instead, they can all be regarded as complementary elements. Chinese SMEs share EM and effectuation elements such as relying on networking, relationship building, adopting a bottom-up approach, use resources at hand, use creative ways to leverage limited resources, achieve control of the future, and so on. Being more entrepreneurial in marketing, employing both entrepreneurial orientation and market orientation as well as applying effectual decision making help Chinese SMEs to operate effectively in the turbulent business environment.