Internal Marketing Orientation, Customer Satisfaction and Profitability: An Empirical Enquiry

Abstract

In the present scenario the service industries have gained immense importance due to the customer inclination towards it, but they are facing challenges regarding profit generation. Service industries are customer driven. Therefore, customer satisfaction and retention is the only mean to profitability. Proper implementation of Internal Marketing Orientation within the organization would develop customer orientation among the employees as they are the service delivery points and their quality of service deliveries would influence the satisfaction level of the customers to a great extent. This ultimately would enhance the profitability as well as financial performance of the company. Various studies have explored different dimensions of Internal Marketing Orientation, Customer satisfaction, and Financial Performance in isolation, and also the nature of relationships among them in the context of advanced nations. But due to the Cultural difference, studies conducted on the employees of the advanced nations might result differently if the same is executed on the employees of the developing nations like India. Hence, the present study aims at developing a comprehensive model that would explain the nature of relationship among IMO, CS and Financial Performance, especially in the context of India. For the purpose of the present work employees and customers of the selected companies from Hospitality, Healthcare, and Banking Sectors have been surveyed. A model of IMO has been developed post EFA. CFA confirms the strength of the model. Finally, Bivariate Correlation analysis has been employed to establish relationship among organization wise IMO, CS and FP values which revealed significant correlation between them. The influence of IMO on CS and Profitability of the firm has been established here. A precise model of IMO is suggested in the present study, which may encourage service industries in implementation of IMO in the future.