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Market orientation and business economic performance : a mediational model

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  • Maydeu Olivares, Alberto
  • Lado, Nora

Abstract

Previous studies have found that market orientation significantly predicts economic performance. The present study attempts to provide a necessarily partial model for how this impact takes place using innovation degree, innovation performance and customer loyalty as intermediate variables. The study targets the insurance industry in the European Union. Our sample accounted for 22 % of the companies and 17 % of the insurance premiums in this market. Our results suggests that the addition of these variables improves our predictions of objective economic performance over what is explained by market orientation alone. Furthermore, we found that the effects of market orientation on economic performance are completely channeled (mediated) through these variables, particularly through innovation degree and innovation performance.

Suggested Citation

  • Maydeu Olivares, Alberto & Lado, Nora, 1998. "Market orientation and business economic performance : a mediational model," DEE - Working Papers. Business Economics. WB 6538, Universidad Carlos III de Madrid. Departamento de Economía de la Empresa.
    • Handle: RePEc:cte:wbrepe:6538
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    1. Danny Miller & Peter H. Friesen, 1982. "Innovation in conservative and entrepreneurial firms: Two models of strategic momentum," Strategic Management Journal, Wiley Blackwell, vol. 3(1), pages 1-25, January.
    2. Praveen R. Nayyar, 1990. "Information asymmetries: A source of competitive advantage for diversified service firms," Strategic Management Journal, Wiley Blackwell, vol. 11(7), pages 513-519, November.
    3. Armstrong, J. Scott & Overton, Terry S., 1977. "Estimating Nonresponse Bias in Mail Surveys," MPRA Paper 81694, University Library of Munich, Germany.
    4. Roger J. Calantone & Jeffrey B. Schmidt & X. Michael Song, 1996. "Controllable Factors of New Product Success: A Cross-National Comparison," Marketing Science, INFORMS, vol. 15(4), pages 341-358.
    5. Selnes, Fred & Jaworski, Bernard J. & Kohli, Ajay K., 1996. "Market orientation in United States and Scandinavian companies. A cross-cultural study," Scandinavian Journal of Management, Elsevier, vol. 12(2), pages 139-157, June.
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    Cited by:

    1. Duygu Seckin Halac & Roberto Biloslavo & Cagri Bulut, 2013. "Marketing Culture and Perceived Customer Satisfaction in Non-Profit Service Organizations," Bogazici Journal, Review of Social, Economic and Administrative Studies, Bogazici University, Department of Economics, vol. 27(2), pages 89-107.
    2. Markus Kreutzer & Laura B. Cardinal & Jorge Walter & Christoph Lechner, 2016. "Formal and Informal Control as Complement or Substitute? The Role of the Task Environment," Strategy Science, INFORMS, vol. 1(4), pages 235-255, December.
    3. Vishal K. Gupta & Gizem Atav & Dev K. Dutta, 2019. "Market orientation research: a qualitative synthesis and future research agenda," Review of Managerial Science, Springer, vol. 13(4), pages 649-670, August.
    4. Tariq Mahmood, 2015. "Mediating Effect of Advertising Expenditure on Labour Productivity - A Case of Manufacturing Industries in Pakistan," The Pakistan Development Review, Pakistan Institute of Development Economics, vol. 54(1), pages 1-15.
    5. Lado, Nora & Martínez Ros, Ester & Martos Partal, Mª de las Mercedes, 2010. "Trends in packaging claims for new products : impacts on firm value," INDEM - Working Paper Business Economic Series id-10-02, Instituto para el Desarrollo Empresarial (INDEM).
    6. Hugo Fuentes & Emili Grifell-Tatjé & Sergio Perelman, 2005. "Product Specialization, Efficiency and Productivity Change in the Spanish Insurance Industry," CREPP Working Papers 0506, Centre de Recherche en Economie Publique et de la Population (CREPP) (Research Center on Public and Population Economics) HEC-Management School, University of Liège.
    7. Jin-An Huang & Chi-Shiun Lai & Jer-San Hu & Rhay-Hung Weng, 2014. "The impact of market orientation on patient loyalty: the mediation of relationship quality," Service Business, Springer;Pan-Pacific Business Association, vol. 8(4), pages 499-515, December.
    8. Robert A.W. Kok & Paul H. Driessen, 2011. "Antecedents of market orientation in semi-public service organizations: a study of Dutch housing associations," The Service Industries Journal, Taylor & Francis Journals, vol. 32(12), pages 1901-1921, February.
    9. Udegbe Scholastica E. & Udegbe Maurice I., 2013. "The Relationship between Market Orientation Firm, Innovativeness and Business Performance of Companies in Nigeria," International Journal of Asian Social Science, Asian Economic and Social Society, vol. 3(11), pages 2350-2362, November.
    10. Patrik Jangl, 2016. "A Comparison of the Market Orientation Model in Czech and German High-Tech Companies," Acta Universitatis Agriculturae et Silviculturae Mendelianae Brunensis, Mendel University Press, vol. 64(5), pages 1717-1729.

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