Concept Of Market Orientation Research Articles

Marketing StrategyMarket orientation: Is it accepted as a 21st century marketing strategy in the pharmaceutical industry? An example: Spain

Following two decades of theoretical contributions to the market orientation concept, today not only the essential details of its application but also its possible effects and benefits have been agreed upon. Numerous studies have confirmed the viability and advantages of a market orientation strategy in different sectors and markets. Thus it is surprising that, given the nature of the pharmaceutical industry, there is a relative absence of references on the application of these principles in this industry. The present study attempts to provide exploratory research into the reasons for this absence. For this purpose, a semi-structured telephone interview was carried out with the managing directors of 30 Spanish pharmaceutical companies. The surprising lack of knowledge of the concept and therefore its apparent lack of application in the pharmaceutical industry appears to run counter to the logic and necessary innovation-orientation in this industry.

Organisational antecedents of market orientation in the public university system

PurposeOver recent years, the new public management system has made significant inroads in Spain, and brought about considerable change. This study seeks to analyse the application of market orientation theories in the context of the Spanish public university. More specifically, the paper aims to study the causal relationship between organisational factors which characterise University departments and the level of market orientation adopted by their teaching staff.Design/methodology/approachConsidering the particularities of this context an exhaustive process is followed to develop the appropriate scales to measure the different constructs studied; then the psychometric properties of these scales are checked and structural equation models applied to analyse the causal relationship between the level of market orientation adopted by the teachers and their antecedent factors.FindingsThe results of the study allow one to identify and confirm that several factors significantly condition the level of market orientation adopted by the University staff in their activities of teaching, research and cultural diffusion.Research limitations/implicationsThe analysis is centred on the case of the Spanish public University system.Practical implicationsUniversity managers should take measures to increase the market orientation of departments. It is necessary to improve knowledge of society's needs, to develop an atmosphere of cohesion and an incentive system that motivates market‐oriented behaviours.Originality/valueIn this paper the market orientation concept is applied to a public service such as the University. The particular characteristics of this context called for an ad hoc re‐adaptation of the concept. Specifically, the design of the scale and its contents had to take into account the plurality of the higher education beneficiaries (students, companies, the administration, society), the three‐fold objectives of the teaching staff (teaching, research, and cultural diffusion) and the particularities of University departments.

Market orientation and innovation: an inter‐relationship analysis

PurposeMarket orientation analyses have focused on two broad‐ranging approaches: the behavioural and the philosophical. The concepts of innovation and market orientation are gaining ground steadily in the context of an increasingly competitive and highly volatile environment, subject to the pressures of rapid‐changing customer needs and desires. This premise underlies the general aim of this study, which is to determine to what extent companies operating in the same sector and with similar market orientation are similarly concerned about innovation.Design/methodology/approachThe population for this study comprises the leading 465 textile companies operating in Spain, listed in the ARDAN database. Data were gathered from in‐depth personalised interviews with 17 company directors operating within the textile sector. In order to verify the hypotheses, groups with similar market orientation were identified using a combination of two techniques: multidimensional scaling analysis; and cluster analysis. After this, ANOVA was used to characterise each group.FindingsThis study of the textile sector, and more specifically of its leading companies, enables one to conclude that market orientation and innovation are not isolated fields. First, four groups of firms which differ significantly in their commitment to market orientation have been found. Second, although a direct relationship between market orientation and innovation could not be statistically proved, some tools and policies considered in the innovation scale are more heavily used by the firms more orientated to the market. Third, in the context of the traditional debate in the literature about the market orientation‐performance relationship, the results of this study support a positive relationship between these two concepts.Research limitations/implicationsThe limitation of the sample size should lead one to treat the final results with caution.Originality/valueThe concepts of innovation and market orientation are gaining ground steadily in the context of an increasingly competitive and highly volatile environment, subject to the pressures of rapidly‐changing customer needs and desires. In this sense, through this paper companies can observe how these two concepts are related in a particular industry and obtain some interesting implications.

Have small businesses adopted the market orientation concept? The case of small businesses in Michigan

PurposeSets out to nvestigate the adoption of and application of the market orientation concept within the small business sector using Michigan, USA, as a study setting.Design/methodology/approachFollowing a literature review, a pilot study involving face‐to‐face interviews with owner‐managers, and covert and overt observation of small businesses' marketing practices, was undertaken. The main thrust of the research involved a postal survey based on an adapted market orientation construct. Exploratory and confirmatory factor analyses are employed to assess the reliability of the results.FindingsReveals four dimensions/factors/strategies underpinning market orientation in the study setting. The paper concludes that the size of the business does not moderate the importance ascribed to, and the application of, the marketing concept (i.e. market orientation).Research limitations/implicationsFuture research should be directed at assessing the congruence between owner‐managers' purported marketing practices and consumers' perceptions of their actions. There is the need to develop normative guidelines concerning small businesses' best practice in market orientation.Practical implicationsInsights derived from this study will provide owner‐managers with the building‐blocks for understanding their firm's market orientation capabilities, an important facet in dealing with upstream (suppliers) and downstream (customers) business relationships.Originality/valueThis study responds to a suggestion for marketing scholars to adapt/adopt existing models, constructs, frameworks, definitions, and also to an assertion that the age‐old adage that what does not get measured does not get managed and, as a result, empirical evidence explaining the appreciation and the employment of an extant market orientation construct in the small business environment has been put forward.

Developing a Value-Based Measure of Market Orientation in an Interactive Service Relationship

This study developed a value-based scale measuring market orientation using both qualitative and quantitative research approaches. The shared views of both front-line employees and customers were used in the scale development process. Findings from the first stage of qualitative research resulted in a preliminary construct incorporating both concepts of market orientation and customer value. The following quantitative research steps validated the developed measures and supported the robustness of the proposed construct.

Pitfalls in Evaluating Market Orientation: An Exploration of Executives' Interpretations

Despite the credibility of the market orientation concept, it is still not being fully realised by practitioners. Many perceive their companies to be orientated to the consumer, but the evidence is contrary and the development of a genuine market orientation remains elusive. This paper identifies eight common reasons why managers misinterpret their companies' market orientation levels and identifies what could be done to rectify the situation. These observations lead to a number of conclusions and implications for both theory and practice.

Market orientation of value chains

PurposeThis paper extends the concept of market orientation from the firm to the value chain level and seeks to develop empirically founded propositions on determinants of different levels of market orientation of value chains.Design/methodology/approachFour case studies on value chains within the areas of agribusiness and fisheries are conducted. For each value chain, desk research is combined with interviews with decision‐makers of all types of value chain members. Interview guidelines were derived from a conceptual model of potential determinants of value chain market orientation.FindingsDegree of market orientation of value chains is found to be related to degree of heterogeneity and dynamism of end‐users served, nature of chain relationships, regulations and prevailing mental models of decision‐makers. Short and balanced chains are believed to further upstream market orientation.Research limitations/implicationsThe results point at two areas, where additional research on market orientation is called for: a better conceptualization of market intelligence and theorizing on most cost effective ways of being market oriented, including implications for the distribution of market oriented activities among value chain members.Practical implicationsThe paper underlines the importance of managing channel relationships, up to and including vertical integration, when serving markets with high degrees of end‐user volatility.Originality/valueThis paper is the first empirical contribution to the market orientation literature employing a perspective encompassing the whole value chain.

The impact of Internal Marketing to Market Orientation concept and their effects to bank performance

The front-line employees of the bank interact with the majority of customers and generally handle a wide range of banking transactions. It is common knowledge that customer satisfaction mainly depends on the process of service delivery and less on its outcome. The above ascertainments highlight the importance of the initiation of Internal Marketing and Market Orientation in a bank institution. This paper presents a research study, which sought to explore the relationship between the Internal Marketing and Market Orientation. In this survey, Human Resources managers of Greek banks participated and as a result the response rate constitutes the 67,3% of the total population. The discussion of findings contributes to understand how Internal Marketing and Market Orientation are linked to the adequacies of the bank and its eventual performance.

Service Market Orientation And Business Performance

In recent decades marketing has become more dynamic than before. The world has undergone rapid technological changes coupled with stiff competitions on the services or products offered in the services industry. In this competitive arena all enterprises exist to gain profit, however it is obvious that there exists no single formula for better services performance. Marketing managers and scholars believe that marketing orientation improves a lot a company's performance. This is vividly shown when one examines literatures on marketing orientation and its impact on companies performance. It is acceptable that marketing orientation, learning organization and business innovations are some of the most important terms for executives to follow. The purpose of this paper is to examine the concept of market orientation and how it can be used to improve business performance especially for service industries. Key words: Service marketing orientation, measurement and business performance. African Journal of Finance and Management Vol.13(1) 2004: 31-37

Responsive and Proactive Market Orientation and New‐Product Success*

What is the relationship between market orientation and new‐product success? This important question has not been examined adequately to date because the concept of market orientation has been measured too narrowly. The concept of market orientation implies both responsive market orientation, which addresses the expressed needs of customers, and proactive market orientation, which addresses the latent needs of customers—that is, opportunities for customer value of which the customer is unaware. In the numerous market orientation–performance studies to date, the measure of market orientation has consisted virtually entirely of behaviors related to satisfying customers' expressed needs rather than satisfying their latent needs as well.The present study extends the measurement of market orientation to match the full scope of the concept—to measure both responsive market orientation and proactive market orientation. Using data from a sample of technologically diverse businesses, the present study develops a measure of proactive market orientation, refines the extant measure of responsive market orientation, and analyzes the relationship of a business's responsive and proactive market orientation to its new‐product success. The study findings imply that for any business to create and to sustain new‐product success, a responsive market orientation is not sufficient and, thus, that a proactive market orientation plays a very important positive role in a business's new‐product success. These findings make intuitive sense. For if in developing its new products a business relies solely on what customers state as their new product needs, the business is very vulnerable economically. Such a business is vulnerable not only for relying on customers' best guesses for new products, many or most of which may have little long‐term economic value for either party, but also to competitors' parallel new product responses and the inevitable resulting price competition. A business that relies solely on customers' expressed needs to develop its new products creates no new insights into value‐adding opportunities for the customer and thereby creates little or no customer dependence and foundation for customer loyalty. The important role for proactive market orientation in new‐product success is intuitively obvious—and is supported empirically in this study.

Effects of Transition Economy on the Market Orientation-Business Performance Link: The Empirical Evidence from Indian Industrial Firms

The purpose of the study was to ascertain the extent to which Indian industrial firms have adopted the concept of market orientation as a result of economic reform. Further, the study examines the link between the market orientation and business performance. The potential effects of competitive intensityand market dynamismwere also examined. Our findings suggested that there was a positive change in the market orientationand that the market orientationwas significantly and positively related to return on investment and customer retention.Further analysis indicated that for a high level of competitive intensityand a low level of market dynamism, the relationship between the market orientation and performance was stronger. Finally, the implications of the findings, the directions for future research, and the limitations of the study are discussed.

Market Orientation: the Concept and Its Development

The concept of market orientation has been one of the most discussed and researched topics in the last decade, This paper attempts to bring out the meaning, need and features of market orientation and the steps involved in its implementation. The paper identifies the relationship of various related concepts with the concept of market orientation. The paper also traces back the development of the field of market orientation through literature survey and identifies the distinct stages in the process of development.

Market orientation and business performance

The market orientation concept has received increasing research attention, although the vast majority of published work has focused on organizations based in western countries, especially in the USA. Given the importance of globalization, this western focus limits our understanding of the concept in global markets. The purpose of this study is to examine how the context of country/economy affects: levels of market orientation; and the strength of linkages between a company's market orientation and its business performance. Data were collected through a survey of firms in both mainland China and Hong Kong. These two economies were selected because they have similarities in cultural dimensions on the one hand, and differences in economic dimensions on the other. While the results suggest that the proposed conceptual model does generalize to a Chinese context, they also show that the country/economic context influences the impact of market orientation on business performance. However, contrary to our prediction, the country/economic context does not appear to affect the levels of market orientation. The implications of our findings are discussed and the limitations of the study as well as future research directions are also addressed.

An Exploratory Study of Market Orientation in China

The concept of market orientation (MO), originally developed in the West and applied to the market economies, also seems to apply to China. Companies operating in China are found to have practised three forms of MO, namely underdeveloped, competitor-focused, and comprehensive MO. Differences among the three forms of MO lie in five key MO factors and two market environment (ME) variables. The MO items most characteristic of the MO concept are ‘Customer satisfaction frequently and systematically measured’, ‘Close attention given to after-sales service’, ‘Inter-functional communication of customer information and experience’, ‘Managers understand how each staff can contribute to creating customer value’, and ‘Rapid response to competitive market actions’. The ME items are ‘Changes in technology of R&D operations’, and ‘Change in total market share held by the four largest competitors in the industry’, reflecting the turbulent nature of the ME in China. While companies practising a specific form of MO are found to have achieved a different level of business performance, they are not found to have particular organizational characteristics.

Managers’ understanding of theoretical concepts: the case of market orientation

Managers are frequently exposed to abstract, theoretical concepts, of which some are attended to while others are neglected. To become meaningful for managers, new abstract concepts must be reflected upon and given content. In this paper, we explore how and to what extent managers understand and make use of the exemplar concept of “market orientation”. The reported findings indicate that managers’ understanding and use of the concept of market orientation, in their goal‐directed effort to perform, are influenced by the actual context in which they are embedded and operate. Our findings also indicate that managers’ understanding of market orientation can deviate substantially from the meaning reflected in the academic literature.

Market orientation and social services in private non‐profit organisations

Very little attention has been devoted so far to the study of the market orientation concept in private non‐profit organisations. However, there is a general agreement concerning the positive effects that this concept’s adoption has on the non‐profit services implementation as well as on these organisations’ long‐term success. Thus this paper aims at obtaining further empirical evidence on this field of research using a private foundations sample. Nevertheless, it is considered that the distinctive and specific nature of private non‐profit organisations’ activities deserves the development of a special instrument to evaluate their degree of market orientation. In this sense, one of this study’s main contributions is the development of a market orientation measurement scale which accounts for the peculiarities of private non‐profit organisations’ operations. Additionally, the study proves the positive effect of market orientation on the non‐profit outcomes and on the fulfilment of these organisations’ missions.

Redefining market orientation from a relationship perspective

Many studies have shown that market orientation is important for firms because it has a positive impact on performance. However, several studies have indicated that the relation between a firm’s market orientation and its success is sometimes weak and that moderating variables need to be considered at least under certain circumstances. As such the overall message from the market orientation studies is not clear. The usefulness of the market orientation concept must also be questioned when looking at the realities of business markets. In most if not all cases the firms’ “surroundings” should be seen as a network of inter‐organizational relationships rather than an anonymous market. Therefore, in this paper the notion of market orientation is explored with particular focus on inter‐organizational relationships. Hereby, it is argued that the relationships are important and that the overall market orientation of firms needs to be translated to a relationship level in order to be effective. It is further argued that market orientation on a relationship level can be interpreted in terms of a firm’s employed resources and executed activities dedicated to relational exchange processes.

The effects of perceived market and learning orientation on assessed organizational capabilities

This study extends prior research by exploring the effects of managerial representations of market and learning orientation on perceived industrial firm capabilities. Cognitions that managers use to make sense of their environment impact competitive strategy decisions. Extant research has found market and learning orientation concepts to be empirically distinct and to have independent and synergistic effects on organizational performance. The present study generally supports hypotheses relating to independent effects of market and learning orientation viewpoints on perceptions of specific capability domains. Findings hold implications for managing the development of organizational capability portfolios as well as for future research aimed at understanding cognitions related to competitive advantage dynamics.

The market orientation concept in the private nonprofit organisation domain

AbstractThe market orientation concept has become one of the central issues of scientific and entrepreneurial study in the marketing discipline. In fact, the theoretical and empirical contributions to this field of research have proliferated in various contexts throughout the last decade. One domain, however, in which market orientation investigation has been relatively limited until recently, is in private nonprofit organisations. Thus, the main purpose of this paper is to delimit the market orientation concept in the private nonprofit organisation context. The alternative basic orientations adopted by these organisations are first assessed in order to specify next the meaning of market orientation from a dual perspective: as an organisational philosophy and culture, and as an organisational behaviour. Copyright © 2002 Henry Stewart Publications

Marketing practices in the UK small business sector

In the UK, some 95 per cent of firms are considered small businesses. Although there is a general agreement in the literature that a market oriented firm is one in which all employees are committed to the continuous creation of superior value for the customer, what is not clear is whether the market orientation concept is appreciated by the small business owner. A postal survey is conducted among owner‐managers aimed at assessing marketing practices within the UK small business sector. The results identify three key strategies (management/staff relationship, profitability and changing markets) employed by owner‐managers. Conclusions, managerial implications and future research directions are discussed.