How does market orientation contribute to service firm performance?

Sheelagh Matear · Phil Osborne · Tony C. Garrett · Brendan Gray

198 citations0/0 files storedEuropean Journal of Marketing

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Innovation and Knowledge Management Marketing and Advertising Strategies Service and Product Innovation

Abstract

This study utilises the inter‐relationship between market orientation and innovation in order to examine alternative mechanisms through which market orientation contributes to service firm performance. Three mechanisms (direct, mediated and moderator) are examined using regression analysis and structural equation modelling in a sample of 231 firms which develop new services. Market orientation is found to contribute to performance through a dual mechanism in that it contributes both directly and through innovation, with innovation mediating the contribution. These results emphasise that researchers should consider the inter‐relationships between multiple sources of advantage in seeking explanations of firm performance.

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References

1999Cutoff criteria for fit indexes in covariance structure analysis: Conventional criteria versus new alternatives 1977Estimating Nonresponse Bias in Mail Surveys 1977Estimating Nonresponse Bias in Mail Surveys 1990The Effect of a Market Orientation on Business Profitability 1990Market Orientation: The Construct, Research Propositions, and Managerial Implications 1993Market Orientation: Antecedents and Consequences 1994The Capabilities of Market-Driven Organizations 1988An Updated Paradigm for Scale Development Incorporating Unidimensionality and Its Assessment

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