Browse > Article
http://dx.doi.org/10.21871/KJFM.2022.13.1.19

Impacts of Marketing Capabilities on Competitive Advantage and Business Performance: Application of IPMA  

CHAO, Meiyu (Asian Food Co.)
SEO, Min Kyo (Graduate School of Knowledge Service & Consulting, Hansung University)
KIM, Jong Rae (Graduate School of Business, Sejong University)
Publication Information
The Korean Journal of Franchise Management / v.13, no.1, 2022 , pp. 19-33 More about this Journal
Abstract
Purpose: Based on the resource-based view and the competitive advantage theory, the study views marketing capabilities (product, pricing, delivery/inventory, and promotional support) as sources of competitive advantage (differentiation advantage and low-cost advantage) and examines their impacts on competitive advantage, which in turn, will influence non-business and business performance. Research design, data and methodology: Data were collected from 149 representatives of franchising companies in South Korea and analyzed with SmartPLS 3.3.7. Results: First, promotional support and product have a significant impact on differentiation advantage. Second, pricing and promotional support have a significant impact on low-cost advantage. Third, differentiation advantage has an influence on non-financial and financial business performance. Fourth, low-cost advantage has an impact on non-financial performance but has no significant direct impact on financial performance. Fifth, non-financial performance is related to financial performance. Finally, the result of IPMA shows that importance and performance values of exogeneous variables are different depending on firm size. Conclusions: The findings suggest that franchisors should focus on different marketing capabilities depending on their strategic focus and objectives. Finally, the findings based on an IPMA suggest that small companies perceive low-cost advantage as important, while their counterparts do not. Several theoretical and managerial implications are offered.
Keywords
Marketing Capabilites; Competitive Advantage; Non-financial and Financial Performance; Franchising Company; Importance-Performance Map Analysis;
Citations & Related Records
Times Cited By KSCI : 2  (Citation Analysis)
연도 인용수 순위
1 Jeng, D. J. F., & Pak, A. (2016). The variable effects of dynamic capability by firm size: The interaction of innovation and marketing capabilities in competitive industries. International Entrepreneurship and Management Journal, 12(1), 115-130.   DOI
2 Lee, H., Jang, K. L., & Lee, Y. (1999). The relationship between market orientation and business performance, and mediators in the hotel industry. Korean Management Review, 28(1), 75-102.
3 Lee, Y.-K., Kim, S. H., & Seo, M. K. (2015). Franchise core competency and its relationship with environmental uncertainty, competitive advantage, and financial performance: An empirical assessment of food-service franchise firms. Asia Pacific Journal of Tourism Research, 20(10), 1151-1173.   DOI
4 Lee, Y.-K., Lim, H.-C., & Yoon, N.-S. (2005). The impact of instrumental and relational oriented factors on franchisees' satisfaction with franchisors in food service industry. Journal of Hospitality and Tourism Studies, 7(3), 156-178.
5 Lee, Y.-K., Park, D. H., & Yoo, D. K. (1999). The structural relationships between service orientation, mediators, and business performance in Korean hotel firms. Asia Pacific Journal of Tourism Research, 4(1), 59-70.   DOI
6 Lodish, L & Mela, C. F. (2007). If brands are built over years, why are they managed over quarters? Harvard Business Review, 85(7/8), 104-112.
7 Miller, D., & Lee, J. (2001). The people make the process: Commitment to employees, decision making, and performance. Journal of Management, 27(2), 163-189.   DOI
8 Morgan, N. A., Vorhies, D. W., & Mason, C. H. (2009). Market orientation, marketing capabilities, and firm performance. Strategic Management Journal, 30(8), 909-920.   DOI
9 Nath, P., Nachiappan, S., & Ramanathan, R. (2010). The impact of marketing capability, operations capability and diversification strategy on performance: A resource-based view. Industrial Marketing Management, 39(2), 317-329.   DOI
10 Newbert, S. L. (2008). Value, rareness, competitive advantage, and performance: A conceptual-level empirical investigation of the resource-based view of the firm. Strategic Management Journal, 29(7), 745-768.   DOI
11 Podsakoff, P. M., MacKenzie, S. B., & Podsakoff, N. P. (2012). Sources of method bias in social science research and recommendations on how to control it. Annual Review of Psychology, 63, 539-569.   DOI
12 Podsakoff, P. M., MacKenzie, S. B., Lee, J. Y., & Podsakoff, N. P. (2003). Common method biases in behavioral research: A critical review of the literature and recommended remedies. Journal of Applied Psychology, 88, 879-903.   DOI
13 Zhou, K. Z., Brown, J. R., & Dev, C. S. (2009). Market orientation, competitive advantage, and performance: A demand-based perspective. Journal of Business Research, 62(11), 1063-1070.   DOI
14 Prieto, I. M. & Revilla, E. (2006). Learning capability and business performance: A non-financial and financial assessment. The Learning Organization, 13(2), 166-185.   DOI
15 Reimann, C., Carvalho, F., & Duarte, M. (2021). The influence of dynamic and adaptive marketing capabilities on the performance of Portuguese SMEs in the B2B international market. Sustainability, 13(2), 579.   DOI
16 Vorhies, D. W., & Morgan, N. A. (2005). Benchmarking marketing capabilities for sustainable competitive advantage. Journal of Marketing, 69(1), 80-94.   DOI
17 Davis, M.A., Lassar, W., Manolis, C.., Prince, M., & Winsor, R.D. (2011). A model of trust and compliance in franchise relationships. Journal of Business Venturing, 26 (3), 321-340.
18 Day, G. S. (1994). The capabilities of market-driven organizations. Journal of Marketing, 58(4), 37-52.   DOI
19 Booms, B. H. & Bitner, M. J. (1981). Marketing strategies and organization structures for service firms. in Donnelly, J. H. & George, W. R. (Eds), Marketing of services, American Marketing Association, Chicago, IL, pp. 47-51.
20 Chin, W. W. (1998). The partial least squares approach to structural equation modeling. Modern Methods for Business Research, 295(2), 295-336.
21 Li, J. J., & Zhou, K. Z. (2010). How foreign firms achieve competitive advantage in the Chinese emerging economy: Managerial ties and market orientation. Journal of Business Research, 63(8), 856-862.   DOI
22 Gomez, M. I., McLaughlin, E. W., & Wittink, D. R. (2004). Customer satisfaction and retail sales performance: An empirical investigation. Journal of Retailing, 80(4), 265-278.   DOI
23 Grewal, R., Chandrashekaran, M., & Citrin, A. (2010). Customer satisfaction heterogeneity and shareholder value. Journal of Marketing, 47(4), 612-626.
24 Hu, L. T., & Bentler, P. M. (1998). Fit indices in covariance structure modeling: Sensitivity to underparameterized model misspecification. Psychological Methods, 3(4), 424-453.   DOI
25 Imad, B-H., Latef, A. A., & Ibrahim, H. (2022). A cognitive analytics management framework to select input and output variables for data envelopment analysis modelling of performance efficiency of banks using random forest and entropy of information. Annals of Operations Research, 308(1/2), 63-92.   DOI
26 Kaleka, A., & Morgan, N. A. (2019). How marketing capabilities and current performance drive strategic intentions in international markets. Industrial Marketing Management, 78, 108-121.   DOI
27 Kim, E.-J. (2021). The effect of brand evidence on positive emotion, negative emotion, and attitude in restaurant industry. Korean Journal of Franchise Management, 12(1), 45-55.   DOI
28 Kock, N. (2015). Common method bias in PLS-SEM: A full collinearity assessment approach. International Journal of e-Collaboration, 11, 1-10.
29 Lee, Y.-K., Moon, H.-N., Park, J.-S., & Chung, N. (2005). An empirical study about strategic framework development for successful cyber IR using IPA. Korean Management Review, 34(3), 891-914.
30 Lee, H., Kim, Y., & Lee, Y. (1998). Market orientation and business performance: Mediating roles of employees satisfaction, customer orientation, and corporate image. Korean Management Review, 27(1), 157-184.
31 Mehrabi, H., Coviello, N., & Ranaweera, C. (2019). Ambidextrous marketing capabilities and performance: How and when entrepreneurial orientation makes a difference. Industrial Marketing Management, 77, 129-142.   DOI
32 Murray, J. Y., Gao, G. Y., & Kotabe, M. (2011). Export market orientation and export performance: The mediating role of marketing capabilities and positional advantages. Journal of the Academy of Marketing Science, 39(2), 252-269   DOI
33 Porter, M. E. (1985). Competitive advantage. creating and sustaining superior performance. New York, USA: Free Press.
34 Tan, Q., & Sousa, C. M. (2015). Leveraging marketing capabilities into competitive advantage and export performance. International Marketing Review., 32(1), 78-102.   DOI
35 Vorhies, D. W., Orr, L. M., & Bush, V. D. (2011). Improving customer-focused marketing capabilities and firm financial performance via marketing exploration and exploitation. Journal of the Academy of Marketing Science, 39(5), 736-756.   DOI
36 Bordonaba-Juste, M.V. & Polo-Redondo, Y. (2008). Differences between short and long-term relationship: An empirical analysis in franchise system. Journal of Strategic Marketing, 16(4), 329-354.,
37 Otto, A. S., Szymanski, D. M., & Varadarajan, R. (2020). Customer satisfaction and firm performance: Insights from over a quarter century of empirical research. Journal of the Academy of Marketing Science, 48(3), 543-564.   DOI
38 McCharty E. J. (1964). Basic marketing: A managerial approach, 2nd ed., IL: Irwin.
39 Alnawas, I. & Hemsley-Brown, J. (2019). Market orientation and hotel performance: Investigating the role of high-order marketing capabilities. International Journal of Contemporary Hospitality Management, 31(4), 1885-1905.   DOI
40 An, D.-S. (2021). Effects of self-service technology quality on SST satisfaction and SST continuance usage intention. Korean Journal of Franchise Management, 12(1), 7-19.   DOI
41 Chen C-Y. (2006). The comparison of structure differences between internet marketing and traditional marketing. International Journal of Management and Enterprise Development, 3(4), 397-417.   DOI
42 Davcik, N. S., & Sharma, P. (2016). Marketing resources, performance, and competitive advantage: A review and future research directions. Journal of Business Research, 69(12), 5547-5552.   DOI
43 Day, G.S. & Wensley, R. (1988). Assessing advantage: A framework for diagnosing competitive superiority. Journal of Marketing, 52(2), 1-20.   DOI
44 Haseeb, M., Hussain, H. I., Kot, S., Androniceanu, A., & Jermsittiparsert, K. (2019). Role of social and technological challenges in achieving a sustainable competitive advantage and sustainable business performance. Sustainability, 11(14), 3811.   DOI
45 Fang, E. & Zou, S. (2009). Antecedents and consequences of marketing dynamic capabilities in international joint ventures. Journal of International Business Studies, 40, 742-761.   DOI
46 Grahovac, J., & Miller, D. J. (2009). Competitive advantage and performance: The impact of value creation and costliness of imitation. Strategic Management Journal, 30(11), 1192-1212.   DOI
47 Grant, R. M. (1991). The resource-based theory of competitive advantage: Implications for strategy formulation. California Management Review, 33(3), 114-135.   DOI
48 Kang, T. W., Sinha, P. N., Park, C. I., & Lee, Y.-K. (2021). Exploring the intra entrepreneurship-employee engagement-creativity linkage and the diverse effects of gender and marital status. Frontiers in Psychology, 4481.
49 Vorhies, D. W. & Harker, M. (2000). The capabilities and performance advantages of market-driven firms: An empirical investigation. Australian Journal of Management, 25(2), 145-173.   DOI
50 Hair, J. F., Hult, G. T. M., Ringle, C., & Sarstedt, M. (2017). A primer on partial least squares structural equation modeling (PLS-SEM). Thousand Oaks, CA: Sage Publications.
51 Hunt, S. D. & Morgan, R. M. (1995). The comparative advantage theory of competition. Journal of Marketing, 59(2), 1-15.   DOI
52 Hunt, S.D. & Madhavaram, S. (2012). Managerial action and resource-advantage theory: Conceptual frameworks emanating from a positive theory of competition. Journal of Business & Industrial Marketing, 27(7), 582-591.   DOI
53 Kachouie, R., Mavondo, F., & Sands, S. (2018). Dynamic marketing capabilities view on creating market change. European Journal of Marketing, 52(5/6), 1007-1036.   DOI
54 Keiningham, T. L., Aksoy, L., Daly, R. M., Perrier, K., & Solom, A. (2006). Reexamining the link between employee satisfaction and store performance in a retail environment. International Journal of Service Industry Management., 17(1), 51-57.   DOI
55 Lawrence, E., Corbitt B., Fisher J. A., Lawrence J., & Tidwell A. (2000). Internet commerce: Digital models for business (2nd ed.), Wiley & Sons.
56 Lee, Y.-K., Nor, Y., Choi, J., Kim, S., Han, S., & Lee, J-H. (2016). Why does franchisor social responsibility really matter? International Journal of Hospitality Management, 53, 49-58.   DOI
57 Kim, S.-I. & Kim, H.-G. (2019). A study on the effects of the internal competence of small business on competitive advantage and startup intention to commercialize a franchise: Focusing on the moderating effect of franchise suitability. Asia-Pacific Journal of Business Venturing and Entrepreneurship, 14(5), 25-42.   DOI
58 Kim, S.-W. & Jang, Y.-H. (2007). The effects of franchise operation factors on relation quality and relation bonding perceived by the member. Journal of Marketing Studies, 15(1), 69-95.