Leo Y.M. Sin, Alan C.B. Tse, Oliver H.M. Yau, Raymond P.M. Chow, and Jenny S.Y. Lee
Executive Summary
This study examines the effect of economic ideology and industry type in moderating the impacts of market orientation (MO) and relationship marketing orientation (RMO) on business performance. The premise of this article is that in different business environments, MO and RMO are unlikely to have similar influences across all markets. Through the examination of companies based in different economies and markets across different market environments, it is possible to study the effects of external, environmental factors. With this approach, the market environment is considered a variable exogenous to the organization, affecting and reinforcing the norms and behaviors within the firm. This article examines how the business-environment context moderates the effect of MO and RMO on business performance.
Using a survey design, the authors collected data from firms in two Chinese economies, Mainland China and Hong Kong. They selected these two economies because they have similarities in cultural dimensions and differences in economic dimensions. The results of the study provide evidence in support of the moderating effect of the economic ideology and industry type on the relationship among MO, RMO, and business performance.
This study validates the MO and RMO scales in a Chinese context on the basis of data that the authors obtain from marketing decision makers at the corporate level. Although the scale was originally developed in the United States at the strategic business unit level, the findings suggest that the scale captures the constructs of MO and RMO well in Hong Kong and Mainland China. In addition, this study identifies the environmental contexts in which MO and RMO would be more effective. The findings support the hypothesis that MO has a greater effect on performance than does RMO in Hong Kong, a market-driven economy. However, as the authors expect, the pattern is reversed in a regulated and transitional economy (e.g., Mainland China).
This study helps expand the understanding of marketing strategies in a transitional economy, especially because it pertains to the relationship among MO, RMO, and business performance. The authors provide some guidelines for marketing managers who handle environmental similarities or diversities across countries. The findings suggest that different marketing strategies should be employed to explore the two Chinese economies. Marketing managers in Hong Kong should continuously monitor customer needs and competitors’ strategies to propose integrated marketing strategies in a timely manner. Conversely, for practitioners in Mainland China and those interested in doing business there, the findings suggest that RMO, not MO, is a more effective strategy for business success.
Biography
Leo Y.M. Sin is a professor, Department of Marketing, The Chinese University of Hong Kong.
Alan C.B. Tse is a professor, Department of Marketing, The Chinese University of Hong Kong.
Oliver H.M. Yau is Chair Professor, Department of Marketing, City University of Hong Kong.
Raymond P.M. Chow is an instructor, Department of Marketing, City University of Hong Kong.
Jenny S.Y. Lee is a university lecturer, Department of Management, City University of Hong Kong.
Journal of International Marketing, Vol. 13, No. 1, March 2005
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