Market orientation, international business relationships and perceived export performance

Abstract

PurposeThis paper aims at investigating and uncovering the potential effect of exporters' market orientation upon international business relationship with particular emphases on cooperation, dependence, and relationship distance.Design/methodology/approachThis is a quantitative study using a mail survey among Thai exporting firms in various industries. The final sample size was comprised of 388 strategic business units (SBU's) from 279 Thai export firms in over eight industries. Data were analyzed using structural equation modeling by means of AMOS 4.01.FindingsExporters' market orientation enhances the cooperation between the exporters and their major overseas distributor while minimizing their dependence and relationship distance. In addition, export performance is higher with greater exporter cooperation and lower relationship distance. Interestingly, the influence of exporter dependence on export performance varied among industry groups.Practical implicationsThis study extends the domain of market orientation in international contexts by illustrating and empirically testing how exporters' market orientation serve as an antecedent to the development of business‐to‐business relationships, which ultimately enhances export performance. To business practitioners, this research pinpoints a particular challenge faced by exporters in managing their relationships with their overseas distributors in order to achieve better performance. Our findings show that market orientation plays a crucial role in developing and nurturing cooperative efforts with overseas distributors. As a result, exporters and their overseas distributors are recommended not only to form cooperative norms that are critical to joint marketing decisions and actions, but also aim to establish and maintain mutual dependence for their superior performance enhancement.Originality/valueThis study contributes to marketing and international business literature and provides insights to exporters by investigating the relationships among market orientation, behavioral aspects of business relationships and export performance. It also provides some evidence that market orientation practices are beneficial in enhancing cross‐cultural relationships, which have been given limited attention in previous literature.