Virtual Collaboration Technology and International Business Coaching: Examining the Impact on Marketing Strategies and Sales

This paper studies the impact of international business coaching via virtual collaboration technology on the strategies and sales of emerging market entrepreneurs. It sheds light on three novel research questions. (1) What is the effect of virtual business coaching on firm sales? (2) What is the mechanism through which this effect occurs? Specifically, does virtual coaching stimulate shifts in marketing strategy? (3) Do entrepreneurs benefit more from virtual coaching when they are less strategic in their decision making? We conducted a randomized controlled field experiment with 930 entrepreneurs in Uganda to examine the impact of a virtual coaching intervention that connects management professionals in primarily advanced markets and entrepreneurs in emerging markets with the aim of improving business performance. The analysis finds a positive and significant main effect on firm sales; treatment entrepreneurs increase monthly sales by 27.6% on average. In addition, entrepreneurs who receive virtual coaching are 52.8% more likely to have shifted their marketing strategy in a new direction. Moreover, consistent with this mechanism of inducing strategic business changes, the results show that entrepreneurs who receive virtual coaching tend to do better when they (ex ante) lack strategic focus. These results have important implications for the development of marketing strategies by entrepreneurs and multinational managers, as well as for policy makers interested in improving the performance of small firms in emerging markets and beyond.