Title: The impact of market orientation on family firm performance

Authors: Hermann Frank; Alexander Kessler; Christian Korunka

Addresses: Research Institute for Family Business, Institute for Small Business Management and Entrepreneurship, WU Vienna University of Economics and Business, Augasse 2-6, A-1090 Vienna, Austria. ' Institute for Management and Entrepreneurship, Competence Team Entrepreneurship, FHWien University of Applied Sciences of WKW, Vienna, Waehringerguertel 97, A-1180 Vienna, Austria. ' Faculty of Psychology, University of Vienna, Universitaetsstrasse 7, A-1010 Vienna, Austria

Abstract: This study aims to investigate the effect of market orientation in a specific organisational context, namely family firms. Market orientation (MO) provides a firm with market-sensing and customer-linking capabilities. Because of their long-term strategies and customer-value orientation, family firms support the development of MO. It is proposed that responsive and proactive MO has a positive impact on the share of regular customers (repeat buyers), success with new products/services and sales growth of family firms. Based on a sample of 344 family firms, regression models confirm that MO shows positive correlations with success with new products/services and share of regular customer's but not with sales growth. The typically strong orientation towards customer bonding and loyalty may prevent family firms from the acquisition of new customers and therefore hinder sales growth.

Keywords: family firms; market orientation; marketing; responsive market orientation; proactive market orientation; firm performance; family business; customer bonding; customer loyalty; sales growth.

DOI: 10.1504/IJESB.2012.047607

International Journal of Entrepreneurship and Small Business, 2012 Vol.16 No.4, pp.372 - 385

Published online: 05 Jul 2012 *

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