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Managing market intelligence: The comparative role of absorptive capacity and market orientation

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  • Rakthin, Sirisuhk
  • Calantone, Roger J.
  • Wang, Joyce Feng

Abstract

Technological knowledge and market knowledge are among the most valuable resources that a firm can utilize for competitive advantage. Absorptive capacity (ACAP) or a firm's ability to acquire, assimilate, transform, and apply knowledge, has long been a central construct in organizational studies. Yet, limited research exists on ACAP in a marketing context. Marketers tend to utilize market orientation (MO) in similar theoretical contexts. This study extends the scope of ACAP beyond a technology-related context and develops a model to compare the performance of both potential and realized ACAP as well as that of MO to assess shared performance in a market-related context. The survey results suggest that ACAP of market knowledge positively influences firm performance by enhancing customer acquisition & retention of the firm.The findings also indicate that market orientation operates through the innovation process to add its effects to that of ACAP. Finally, this study discusses the moderating role of a firm's balance in cost leadership and differentiation strategy, suggesting comparative and distinguishable effects of ACAP of market knowledge and market orientation.

Suggested Citation

  • Rakthin, Sirisuhk & Calantone, Roger J. & Wang, Joyce Feng, 2016. "Managing market intelligence: The comparative role of absorptive capacity and market orientation," Journal of Business Research, Elsevier, vol. 69(12), pages 5569-5577.
    • Handle: RePEc:eee:jbrese:v:69:y:2016:i:12:p:5569-5577
    DOI: 10.1016/j.jbusres.2016.03.064
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    2. Wenbo Jiang & Francesco Rosati & Huaqi Chai & Taiwen Feng, 2020. "Market orientation practices enhancing corporate environmental performance via knowledge creation: Does environmental management system implementation matter?," Business Strategy and the Environment, Wiley Blackwell, vol. 29(5), pages 1899-1924, July.
    3. Gligor, David & Gligor, Nichole & Maloni, Michael, 2019. "The impact of the supplier's market orientation on the customer market orientation-performance relationship," International Journal of Production Economics, Elsevier, vol. 216(C), pages 81-93.
    4. Rao Tahir Anees & Nordiana Ahmad Nordin & Temoor Anjum & Luigi Pio Leonardo Cavaliere & Petra Heidler, 2020. "Evaluating the Impact of Customer Relationship Management (CRM) Strategies on Customer Retention (A Study of Fast Food Chains in Pakistan)," Business Management and Strategy, Macrothink Institute, vol. 11(2), pages 117-133, December.
    5. Weidner, Nadia & Som, Oliver & Horvat, Djerdj, 2023. "An integrated conceptual framework for analysing heterogeneous configurations of absorptive capacity in manufacturing firms with the DUI innovation mode," Technovation, Elsevier, vol. 121(C).
    6. Dąbrowski Dariusz, 2018. "Different Sources of Market Information and Product Innovativeness," Economics and Business Review, Sciendo, vol. 4(3), pages 7-23, July.
    7. Yueping Du & Huanhuan Wang, 2022. "Green Innovation Sustainability: How Green Market Orientation and Absorptive Capacity Matter?," Sustainability, MDPI, vol. 14(13), pages 1-20, July.
    8. Markovich, Amiram & Efrat, Kalanit & Raban, Daphne R. & Souchon, Anne L., 2019. "Competitive intelligence embeddedness: Drivers and performance consequences," European Management Journal, Elsevier, vol. 37(6), pages 708-718.

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