Impact of digital marketing capabilities on market performance of small to medium enterprise agro-processors in Harare, Zimbabwe
The importance of marketing capabilities continues to grow yet research remains concentrated in developed markets. Although several researchers provide evidence of the influence of marketing capabilities on market performance, very little of similar evidence exists in the digital marketing domain. Empirical evidence of the impact of digital marketing capabilities on market performance of small to medium enterprise (SME) agro-processors particularly from developing countries remains scarce. The purpose of this paper was to investigate the impact of digital marketing capabilities on SME agro-processors’ both intermediate and final market performance outcomes. To achieve this, we conducted a survey of 298 SME agro-processors’ managers and owners in Harare, Zimbabwe. A mixed sampling approach consisting of quota and stratified sampling approaches was adopted. We distributed a closed-ended questionnaire through the drop-off & pick-up and interviewer-based methods. The data was analysed statistically using STATA version 15. Multiple logistic regression was conducted to determine impact of digital marketing capabilities on market performance. Our findings indicate that digital strategy development & execution, digital market innovation, e-market sensing and leadership capabilities positively influence intermediate market outcomes of customer awareness, customer attitudes, availability, and brand associations. However only digital strategy development & execution capability was positively associated with final market performance outcomes of sales growth, market share and profitability. These results imply that agro-processors must develop digital marketing capabilities that enable them to move beyond intermediate market outcomes to attain the primary business objectives of profitability, sales growth and market share. Attaining intermediate market outcomes only is not enough for business sustainability. The study contributes to literature by extending the marketing capabilities discussion to the digital marketing environment in a developing country context. This was important because marketing knowledge is contextual, as such cannot easily be transferred from one market to the other.
This work is licensed under a Creative Commons Attribution 4.0 International License.
AfDB. (2018). Zimbabwe economic outlook. https://www.afdb.org/en/countries/southern-africa/zimbabwe/zimbabwe-economic-outlook/
Ampadu-Ameyaw, R., & Omari, R. (2015). Small-scale rural agro-processing enterprises in Ghana: Status, challenges and livilihood opportunites for women. Journal of Scientific Research and Reports, 6(1), 61–72. https://doi.org/10.9734/JSRR/2015/15523
Bagozzi, R. P., Yi, Y. & Phillips, L. W. (1991). Assessing construct validity in organisational research. Administrative Science Quarterly, 36, 421–458. https://doi.org/10.2307/2393203
Barney, J. B. (2013). How marketing scholars might help address issues in resource-based theory. Journal of the Academy of Marketing Science, 42, 24–26. https://doi.org/10.1007/s11747-013-0351-8
Barney, J. B., & Hesterly, W. S. (2015). Strategic management and competitive advantage. Concepts and cases (5th ed.). Pearson.
Barrett, M., Davidson, E., Prabhu, J., & Vargo, S. L. (2015). Service innovation in the digital age: Key contributions and future directions. MIS Quarterly, 39(1), 135–154. https://doi.org/10.25300/MISQ/2015/39:1.03
Bitencourt, C. C., et al. (2019). The extended dynamic capabilities model; a meta-analysis. European Management Journal, 38(1), 108–120. https://doi.org/10.1016/j.emj.2019.04.007
Bomani, M. (2016). Government policies and strategies in dealing with challenges confronting small and medium enterprises: a case of Harare, Zimbabwe. University of Kwazulu-Natal (unpublished Phd thesis).
Cacciolatti, L., & Lee, S. H. (2016). Revisiting the relationship between marketing capabilities and firm performance: The moderating role of market orientation, marketing strategy and organisational power. Journal of Business Research, 69, 5597–5610. https://doi.org/10.1016/j.jbusres.2016.03.067
Calantone, R. J., Cavusgil, T. S., & Zhao, Y. (2002). Learning orientation, firm innovation capability, and firm performance. Industrial Marketing Management, 31, 515–524. https://doi.org/10.1016/S0019-8501(01)00203-6
Carmines, E. G., & Zeller, R. A. (1979). Reliability and validity assessment. Sage Publications. https://doi.org/10.4135/9781412985642
Chaffey, D. (2015). Digital business and e-commerce management: Strategy, implementation and practice (6th ed.). Pearson Education Limited.
Chaffey, D., & Ellis-Chadwick, F. (2016). Digital marketing: strategy, implementation and practice (6th ed.). Pearson Education Limited.
Chaffey, D., & Leszczynski, M. (2017). E-mail marketing and market automation. s.l.: SmartInsights & Getresponse.
Charlesworth, A. (2018). Digital marketing. A practical approach (3rd ed.). Routledge. https://doi.org/10.4324/9781315175737
Chigwenya, A., & Mudzengerere, F. H. (2013). The small and medium entreprise policy in Zimbabwe. A narrative of strides taken to mainstream the informal sector activities in urban local authorities in Zimbabwe. International Journal of Politics and Good Governance, 4(4), 1–18.
Clark, B. (2007). Measuring marketing performance: research, practice and challenges. In A. Neely (ed.), Business performance measurement (pp. 36–63). Cambridge University Press.
Davick, N. S., & Sharma, P. (2016). Marketing resources, performance and competitive advantage: A review and future research directions. Journal of Business Research, 69, 5547–5552. https://doi.org/10.1016/j.jbusres.2016.04.169
Davidaviciene, V., Raudeliuniene, J., & Putrimas, S. (2019). Communication needs in cyberspace of industrial companies’ consumers. International Journal of ICT research in Africa and the Middle East, 8(1). https://doi.org/10.4018/IJICTRAME.2019010104
Day, G. S. (1994). The capabilities of market-driven organizations. Journal of Marketing, 58(4), 7–52. https://doi.org/10.1177/002224299405800404
Day, G. S. (2011). Closing the marketing capabilities gap. Journal of Marketing, 17, 183–195. https://doi.org/10.1509/jmkg.75.4.183
Day, G. S. (2014). An outside-in approach to resource-based theories. Journal of the Academy of Marketing Science, 42, 27–28. https://doi.org/10.1007/s11747-013-0348-3
de Ruyter, K., Keeling, D. I., & Ngo, L. V. (2018). When nothing is what it seems: A digital marketing research agenda. Australasian Marketing Journal, 26, 199–203. https://doi.org/10.1016/j.ausmj.2018.07.003
Enterprise Management 360. (2017). 2 million businesses in the UK do not have a website. https://www.em360tech.com/tech-news/2-million-small-businesses-in-the-uk-dont-have-a-website/
FinScope. (2012). FinScope MSME Survey Zimbabwe 2012. Finmark Trust.
Foltean, F. S. (2019). Bridging marketing theory – practice gap to enhance ﬁrm performance: Introduction to the special issue. Journal of Business Research, 104, 520–528. https://doi.org/10.1016/j.jbusres.2019.06.008
Frosen, J., Luoma, J., Jaakkola, M., Tikkanen, H., & Aspara, J. (2016). What counts versus what can be counted: the complex interplay of market orientation and marketing performance measurement. Journal of Marketing, 80, 60–78. https://doi.org/10.1509/jm.15.0153
Garson, D. G. (2013). Validity and reliability. Statistical Publishing Associates.
Gielens, K., & Steenkamp, J.-B. E. (2019). Branding in the era of digital (dis) intermediation. International Journal of Research in Markting, 36(3), 367–384. https://doi.org/10.1016/j.ijresmar.2019.01.005
Gilmore, A., Gallagher, D., & Henry, S. (2007). E-marketing and SMEs: Operational lessons for the future. European Business Review, 19(3), 234–247. https://doi.org/10.1108/09555340710746482
Grant, R. M. (1991). The resource based theory of competitive advantage: Implications for strategy formulation. California Management Review, 33(3), 114–135. https://doi.org/10.2307/41166664
Gregory, G. D., Ngo, L. V., & Karavdic, M. (2019). Developing e-commerce marketing capabilities and efficiences for enhanced performances in business-to-business export ventures. Industrial Marketing Management, 78, 146–157. https://doi.org/10.1016/j.indmarman.2017.03.002
Guo, H., Xu, H., Tang, C., Liu-Thompkins, Y., Guo, Z., & Dong, B. (2018). Comparing the impact of different marketing capabilities: Empirical evidence from B2B ﬁrms in China. Journal of Business Research, 93, 79–89. https://doi.org/10.1016/j.jbusres.2018.04.010
Habibi, H., Hamilton, F., Valos, C. A., John, M., & Brendan, M. (2015). E‐marketing orientation and social media implementation in B2B marketing. European Business Review, 27(6), 1–18. https://doi.org/10.1108/EBR-03-2015-0026
Heini, T., & Heikki, K. (2015). The use of digital channels in SMEs. Journal of small business and enterprise development, 22(4), 633–651. https://doi.org/10.1108/JSBED-05-2013-0073
Herhold, K. (2018). The importance of digital marketing in 2018. https://www.business2community.com/digital-marketing/the-importance-of-digital-marketing-in-2018-02101555
Hooley, G., Cadogan, G., & Fahy, J. (2005). The performance impact of marketing resources. Journal of Business Research, 58, 18–27. https://doi.org/10.1016/S0148-2963(03)00109-7
Homburg, C., Grozdanovic, M., & Klarmann, M. (2007). Responsiveness to customers and competitors: the role of affective and cognitive organisational systems. Journal of Marketing, 71(3), 18–38. https://doi.org/10.1509/jmkg.71.3.018
Hunt, S. D., & Madhavaram, S. (2019). Adaptive marketing capabilities, dynamic capabilities, and renewal competences: The “outside vs. inside” and “static vs. dynamic” controversies in strategy. Industrial Marketing Management, 89, 129–139. https://doi.org/10.1016/j.indmarman.2019.07.004
Inan, G. G., & Bititci, U. S. (2015). Understanding organisational capabilities and dynamic capabilties in the context of micro enterprises: A research agenda. Procedia. Social and Behavioural Sciences, 210, 310–319. https://doi.org/10.1016/j.sbspro.2015.11.371
ITAC. (2016). Agroprocessing markets and related trade trends. Opportunites and challenges for South Africa. s.l.: International Trade Administration Commission of South Africa.
Jean, R.-J. B., & Kim, D. (2019). Internet and SMEs’ internationalisation: the role of platform and website. Journal of International Management, 26(1). https://doi.org/10.1016/j.intman.2019.100690
Kaleka, A., & Morgan, N. A. (2019). How marketing capabilities and current performance drive strategic intentions in international markets. Industrial Marketing Management, 78, 108–121. https://doi.org/10.1016/j.indmarman.2017.02.001
Khan, E. A. (2017). An investigation of marketing capabilities of informal microenterprises: A study of street food vending in Thailand. International Journal of Sociology and Social Policy, 37(3/4), 186–202. https://doi.org/10.1108/IJSSP-09-2015-0094
Kholi, A. K., & Jaworski, B. J. (1990). Market orientation: the construct, research propositions, and managerial implications. Journal of Marketing, 54(2), 1–18. https://doi.org/10.1177/002224299005400201
Kotler, P., Kartajaya, H., & Setiawan, I. (2017) Marketing 4.0: Moving from traditional to digital. Wiley & Sons.
Kotler, P., & Keller, K. L. (2016). Marketing management: global edition (15 ed.). Pearson.
Kyriakopoulos, K., Hughes, M., & Hughes, P. (2015). The roles of marketing resources in radical innovation activity: Antecedents and Payoffs. Journal of Product Innovation Management, 33(4), 398–417. https://doi.org/10.1111/jpim.12285
Lin, Y., & Wu, L.-Y. (2014). Exploring the role of dynamic capabilities in firm performance under the resource based view framework. Journal of Business Research, 67(3), 407–413. https://doi.org/10.1016/j.jbusres.2012.12.019
Lynch, R. (2015). Strategic management (7th ed.). Pearson Publishing.
Mathews, S., et al. (2016). Internet marketing capabilities and international market growth. International Business Review, 25, 820–830. https://doi.org/10.1016/j.ibusrev.2015.10.007
Matsongoni, H., & Mutambara, E. (2018). An assessment of informal SMEs’ potential in an African economy – theoretical and conceptual framework. Public and Municipal Finance, 7(2), 6–17. https://doi.org/10.21511/pmf.07(2).2018.01
Mhazo, N., Mvumi, B. M., Nyakudya, E., & Nazare, R. M. (2012). The status of the agro-processing industry in Zimbabwe with particular reference to small- and medium-scale enterprises. African Journal of Agricultural Research, 7(11), 1607–1622. https://doi.org/10.5897/AJAR10.079
Milfelner, B., Gabrijan, V., & Snoj, B. (2008). Can marketing resources contribute to company performance? Organizacija, 41(1), 3–13. https://doi.org/10.2478/v10051-008-0001-y
Mooi, E., Sarstedt, M., & Mooi-Reci, I. (2018). Market research. The process, data and methods using strata. Springer. https://doi.org/10.1007/978-981-10-5218-7
Moorman, C., & Day, G. S. (2016). Organising for marketing excellence. Journal of Marketing, 80, 6–35. https://doi.org/10.1509/jm.15.0423
Morgan, N. A. (2012). Marketing and business performance. Academy of Marketing Science, 40, 102–119. https://doi.org/10.1007/s11747-011-0279-9
Morgan, N. A., Slotegraaf, R. A., & Vorhies, D. W. (2009). Linking marketing capabilites with profit. International Journal of Research in Marketing, 26, 284–293. https://doi.org/10.1016/j.ijresmar.2009.06.005
Narver, J. C., & Slater, S. F. (1990). The effects of market orientation on business profitability. Journal of Marketing, 54, 20–35. https://doi.org/10.1177/002224299005400403
Neely, A. (2007). Business performance measurement. Unifying theories and integrating practice (2nd ed.). Cambridge University Press. https://doi.org/10.1017/CBO9780511488481
Orlandi, L. B. (2016). Organisational capabilities in the digital era: Reframing strategic oritentation. Journal of Innovation & Knowledge, 1, 156–161. https://doi.org/10.1016/j.jik.2016.01.002
O’Sullivan, D., & Abela, A. V. (2007). Marketing performance measurement ability and firm performance. Journal of Marketing, 71, 79–93. https://doi.org/10.1509/jmkg.71.2.079
POTRAZ. (2017). Abridged annual postal and telecommunications sector performance report 2017. Postal and Telecommunications Regulatory Authority of Zimbabwe (POTRAZ).
Qureshi, M. S., Aziz, N., & Mian, S. A. (2017). How marketing capabilities shape entrepreneurial firm’s performance? Evidence from new technology based firms in Turkey. Journal of Global Enterprenuerial Research, 7(15), 2–15. https://doi.org/10.1186/s40497-017-0071-5
Romijn, H., & Albaladejo, M. (2002). Determinants of innovation capability in small electronics and software firms in southeast England. Research Policy, 31, 1053–1067. https://doi.org/10.1016/S0048-7333(01)00176-7
Saunders, M., Lewis, P. & Thornhill, A. (2016). Research methods for business students (7th ed.). Pearson Education Limited.
Sekeran, U., & Bougie, R. (2016). Research methods for business. a skill building approach (7th ed.). Wiley.
Sergie, S. H., Cavusgil, E. & Phelan, S. E. (2007). Measurement of return on marketing investment: A conceptual framework and the future of marketing metrics. Industrial Marketing Management, 36, 834–841. https://doi.org/10.1016/j.indmarman.2006.11.001
Setia, P., Venkantesh, V., & Joglekar, S. (2013). Leveraging digital technologies: How information quality leads to localised capabilities and customer service performance. MIS Quarterly, 37(2), 565–590. https://doi.org/10.25300/MISQ/2013/37.2.11
Sheth, J. N. (2011). Impact of emerging markets on marketing: Rethinking existing perspectives and marketing. Journal of Marketing, 75, 166–182. https://doi.org/10.1509/jmkg.75.4.166
Teece, D. J. (2014). A dynamic capabilities-based entrepreneurial theory of the multinational enterprise. Journal of International Business Studies, 45, 8–37. https://doi.org/10.1057/jibs.2013.54
Teece, D. J. (2016). Dynamic capabilities and enterpreneurial management in large organisations: Toward a theory of the (entrepreneurial) firm. European Economic Review, 86, 202–216. https://doi.org/10.1016/j.euroecorev.2015.11.006
Teece, D. J., Gary, P. & Shuen, A. (1997). Dynamic capabilities and strategic management. Strategic Management Journal, 18(7), 509–533. https://doi.org/10.1002/(SICI)1097-0266(199708)18:7<509::AID-SMJ882>3.0.CO;2-Z
Trainor, K. J., Krush, M. T., & Agnihotri, R. (2013). Effects of relational proclivity and marketing intelligence on new product development. Marketing Intelligence Planning, 31(7), 788–806. https://doi.org/10.1108/MIP-02-2013-0028
Verhoef, P. C., & Bijmolt, T. (2019). Marketing perpectives on digital business models: A framework and overview of the special issue. International Journal of Research in Marketing, 36(3), 341–349. https://doi.org/10.1016/j.ijresmar.2019.08.001
Vorhies, D. W., & Morgan, N. A. (2005). Benchmarking marketing capabilities for sustainable competitive advantage. Journal of Marketing, 69, 80–94. https://doi.org/10.1509/jmkg.220.127.116.11505
Wang, Z., & Kim, H. G. (2017). Can social media marketing improve customer relationship capabilities and firm performance? Dynamic capability perspective. Journal of Interactive Marketing, 39, 15–26. https://doi.org/10.1016/j.intmar.2017.02.004
Wearesocial. (2019). Digital in 2019. https://wearesocial.com/global-digital-report-2019
Wendra, W., Sule, E. T., Joeliaty, J., & Azis, Y. (2019). Exploring dynamic capabilities, intellectual capital, and innovation performance relationship: Evidence from the garment manufacturing. Business: Theory and Practice, 20, 123–136. https://doi.org/10.3846/btp.2019.12
WSI. (2015). Digital minds. 12 things every business need to know about digital marketing (2nd ed.). FriesenPress.
Wymbs, C. (2011). Digital marketing: The time for a new “academic major” has arrived. Journal of Marketing Education, 33(1), 93–106. https://doi.org/10.1177/0273475310392544
Zhou, J., Mavondo, F. T., & Saunders, S. G. (2019). The relationship between marketing agility and financial performance under different levels of market turbulence. Industrial Marketing Management, 83, 31–41. https://doi.org/10.1016/j.indmarman.2018.11.008
Zindiye, S., Chiliya, N., & Masocha, R. (2012). The impact of government and other institutions’ support on the performance of small and medium entreprises in the manufacturing sector in Harare, Zimbabwe. International Journal of Business Economics Research, 3(6), 655–657.