The Effects of Internal Marketing and Entrepreneurial Orientation on Innovation in Family Businesses

Abstract

The purpose of this paper is to examine the effect of internal marketing and entrepreneurial orientation on innovation in family businesses. By reviewing related literature, the relationships among internal marketing, entrepreneurial orientation, and innovation were hypothesized. The developed conceptual model is tested using structural equation modeling (SEM) using a sample of 288 family businesses. The result of the SEM model shows that both internal marketing and entrepreneurial orientation act as a basis for innovation in family businesses. Further, it was revealed that internal marketing is key determinant of entrepreneurial orientation in the context of family business. The study has contributed to the literature by demonstrating the routes through which internal marketing and entrepreneurial orientation impact on innovation in the case of family businesses.