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The impact of formal processes for market information acquisition and utilization on the performance of Chinese new ventures

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  • Song, Michael
  • Di Benedetto, C. Anthony
  • Parry, Mark E.

Abstract

The authors examine the performance impact of formal market information processes. Specifically, a theoretical model is developed that hypothesizes that formal processes for market information acquisition and utilization have direct and positive main effects on new venture success and is then tested using a sample of 222 new ventures located in China. Findings indicate that new venture success is positively correlated with the use of formal processes for market information acquisition and use. Moreover, the relative importance of formal processes to the acquisition and use of market information depends on whether the new venture serves an emerging or established market. In particular, the impact of formal processes for information acquisition is higher among new ventures that serve emerging markets. In contrast, the impact of formal processes for information use is higher among new ventures that serve established markets. We present managerial implications of our results. For example, a new venture with a strong market orientation can respond quickly to emerging marketplace needs, and can even seize the advantage from incumbents. If it is in an emerging market, however, the new venture management team should strive to excel at information acquisition; in an established market, it is important for the management team to excel at information utilization.

Suggested Citation

  • Song, Michael & Di Benedetto, C. Anthony & Parry, Mark E., 2009. "The impact of formal processes for market information acquisition and utilization on the performance of Chinese new ventures," International Journal of Research in Marketing, Elsevier, vol. 26(4), pages 314-323.
    • Handle: RePEc:eee:ijrema:v:26:y:2009:i:4:p:314-323
    DOI: 10.1016/j.ijresmar.2009.08.003
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    References listed on IDEAS

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    4. Zhang, Junfeng & Wu, Wei-ping, 2013. "Social capital and new product development outcomes: The mediating role of sensing capability in Chinese high-tech firms," Journal of World Business, Elsevier, vol. 48(4), pages 539-548.

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