Marketing Department’s Influence and Information Dissemination Within in a Firm: Evidence for an Inverted U-Shaped Relationship

Abstract

The dissemination of market intelligence across an organization is a key task of a firm’s marketing department, as recognized by marketing researchers (e.g., Maltz and Kohli 1996) and practitioners (e.g., Mohr et al. 2010). They place great emphasis on market intelligence dissemination, a main component of firm’s (internal) market orientation (e.g., Jaworski and Kohli 1993), due the strategic importance (Makadok and Barney 2001) and its positive effects on the financial performance of a firm (e.g., Kumar et al. 1998). In order to enhance intelligence dissemination throughout the firm, conventional wisdom in the market orientation literature suggests marketing department’s influence within the firm as an important driver (Verhoef and Leeflang 2009). Hereby, past research (e.g., Moorman and Rust 1999; Verhoef et al. 2011) has generally assumed a positive linear relationship between marketing influence and market intelligence dissemination, and subsequently on performance. Our research, however, questions an entirely positive linear relationship. Specifically, building on social psychological research that implies that the degree of influence affects communication behavior (e.g., Keltner et al. 2003), we suggest that high marketing influence can ironically backfire. Hence, we propose that marketing influence has an inverted U- shaped relationship with market intelligence dissemination, which in turn impacts financial firm performance.