Market Orientation, Competitive Strategy and Firm Performance An Empirical Study of Chinese Firms

• Published in: Journal of global marketing Vol. 18; no. 3-4; pp. 115 - 142
• Main Authors: Ge, Gloria L., Ding, Daniel Z.
• Format: Journal Article
• Language: English
• Published: New York Taylor & Francis Group 12.08.2005; Taylor & Francis LLC
• Subjects: Chinese firms; Competition; competitive strategy; Customer relations; Financial performance; firm performance; Manufacturing; Market orientation; mediating effects; structural equation modeling; Studies; China
• ISSN: 0891-1762; 1528-6975
• DOI: 10.1300/J042v18n03_06

In this paper, we investigate the mediating effects of a firm's competitive strategy in the market orientation-performance relationship. Based on a sample of 371 manufacturing firms in China, evidence was found that the three dimensions of market orientation exert different effects on competitive strategy and performance. Among them, customer orientation has the strongest association with competitive strategy and market performance. This lends credence to a componentwise approach on the study of the relationship between market orientation and performance. The results of structural equation analyses indicate that the mediating effect of competitive strategy is mainly revealed in innovation strategy, the most vital factor in creating superior value for the company in the emerging market. Limitations of this study and implications for future studies are discussed.