Investigating the links between market orientation, marketing capabilities and performance in the context of retailing: a structural equation model approach

The present study investigates the links between market orientation
(MO), store-level marketing capabilities and performance. In particular, we are
interested in to analyse the relationship between MO and store-level marketing
capabilities, and the impact of these store-level marketing capabilities on
performance. The store-level marketing capabilities studied here are:
1) assortment management capability; 2) customer-service management
capability. For the purpose of the study, we develop a conceptual model and
related hypotheses. The hypotheses are tested using structural equation
modelling (SEM) with a sample of 202 small Finnish retail entrepreneurs in the
field of specialty goods retailing. Our findings offer the several substantive
contributions. As a first contribution, the findings of the present study indicate
that the relationship between retailer MO and store-level marketing capabilities
is both positive and significant. As a second contribution, the study shows that
both assortment management capability and customer-service management
capability have a positive impact on customer performance. As a third
contribution, the findings of our study indicate that store-level marketing
capabilities do not have a direct impact on financial performance.