Unit VI Assignment
Marketing Capabilities in International Marketing Neil A. Morgan, Hui Feng, and Kimberly A. Whitler
ABSTRACT There has been a significant increase in scholarly research focusing on marketing capabilities as an important aspect of marketing theory–based explanations of firm performance. This growing research interest in marketing capabilities has also been reflected in the international marketing literature. However, it is unclear whether and how thinking and research about international marketing capabilities differs from that of marketing capabilities in a domestic market context. To explore this question, the authors conduct a review of studies of marketing capabilities in the most influential journals publishing research in international marketing. They supplement this with insights from interviews with ex- ecutives in firms engaged to varying degrees in international marketing. The study suggests that there remain numerous important unanswered questions in conceptualizing and empirically researching international marketing capabilities.
Keywords: marketing capabilities, international marketing, marketing strategy, marketing performance
Online Supplement: http://dx.doi.org/10.1509/jim.17.0056
T he concept of capabilities in the marketing literature is not new. Drawing on theory and empirical work in strategic management, researchers have generally
viewed capabilities as complex bundles of skills and knowledge embedded in the organizational processes by which a firm’s available resources are transformed into valuable outputs (Day 1994). As capabilities are developed over time and become embedded in organizational pro- cesses and routines, they are difficult for rivals to observe and imitate, thereby enabling firms that possess them to enjoy sustainable competitive advantage (Grant 1996; Grewal and Slotegraaf 2007; Peteraf 1993). Marketing researchers have conceptualized marketing capabilities in terms of a firm’s ability to use available resources to per- form marketing tasks in ways that achieve desired mar- keting outcomes (Morgan, Katsikeas, and Vorhies 2012). The literature suggests that marketing capabilities are es- pecially valuable (Dutta, Narasimhan, and Rajiv 1999),
inimitable (Morgan, Vorhies, and Mason 2009), and nonsubstitutable in creating sustainable competitive ad- vantage and superior firm performance (Krasnikov and Jayachandran 2008; Moorman and Rust 1999). In in- ternational markets, marketing capabilities have also been shown to improve firm performance by enhancing the level and sustainability of realized positional advantages (for a review, see, e.g., Tan and Sousa 2015).
Over the past 18 years, marketing scholars have intensified their focus on conceptualizing marketing capabilities and empirically examining their role in explaining firm perfor- mance. This growth in research attention has been mirrored in the international marketing literature. However, the extent to which conceptual and empirical approaches to studying marketing capabilities in the international context differ—and should differ—from those in domestic market contexts remains unclear. This is an important gap in existing knowledge in both theoretical and practical terms. From a theory perspective, it is difficult for researchers toNeil A. Morgan is Professor and PetSmart Distinguished Chair of
Marketing, Kelley School of Business, Indiana University (email: namorgan@indiana.edu). Hui Feng is Assistant Professor of Marketing, Debbie and Jerry Ivy College of Business, Iowa State University (email: huifeng@iastate.edu). Kimberly A. Whitler is Assistant Professor of Marketing, Darden School of Business, University of Virginia (email: whitlerk@darden.virginia.edu). Matthew Robson served as associate editor for this article.
Journal of International Marketing ©2018, American Marketing Association Vol. 26, No. 1, 2018, pp. 61–95 DOI: 10.1509/jim.17.0056 ISSN 1069-031X (print) 1547-7215 (electronic)
Marketing Capabilities in International Marketing 61
accurately conceptualize and measure marketing capabil- ities without knowing whether and how they may be dif- ferent in international (vs. purely domestic) market contexts. In addition, without an understanding of whether and how the mechanisms linking marketing capabilities with per- formance outcomes may (or may not) differ in international marketing contexts, it is difficult for researchers to know what types of mediators and moderators to study.
From a managerial perspective, managerswant to know both what types of marketing capabilities may be appropriate for their firms and how to build, maintain, and leverage them—and the answers to these questions may vary based on the degree to which they operate in international markets and how they are organized to do so. Without understanding whether and how these international-related contingencies may matter, it is impossible for international marketing re- searchers to provide appropriate guidance to managers.
We address this important gap in knowledge, in an effort to clarify thinking and provide guidance for future research in this theoretically interesting and managerially important area. As a starting point, we examine published research to identify and explore key differences between international and domestic marketing capabilities regarding their concep- tualization, types, measurements, development, and relation- ships.Wethenfurtherexplore anumberof importantresearch questions arising from this analysis: (1) What are the drivers of marketing capability development in international markets? (2) Can marketing capabilities help improve firm performance in the international markets, and if so, how? (3) What con- ditions may enhance or weaken the marketing capability–firm performance relationship in international markets?
To accomplish this, we first review the literature to examine howmarketingcapabilitieshavebeenstudiedininternational marketing contexts. Second, given important gaps identified in literature-based knowledge, we supplement this literature- based analysis with insights from practice generated through in-depth interviews with executives in firms with varying degrees of internationalization. These inputs are then used to synthesize existing knowledge regarding marketing capa- bilities in international marketing, identify key knowledge gaps, and develop an agenda for future research in this important domain.
REVIEW OF EXISTING RESEARCH Overview
Our literature review focuses on the most influential journals publishing international marketing research since
1999. To ensure the representativeness, completeness, and high quality of studies included in our review, the criteria for journal selection were based on previous ratings of journals in marketing and international business disciplines (Kirca and Yaprak 2010). In the marketing discipline, we chose six out of the ten most influential marketing journals from Baumgartner and Pieters’s (2003) study (i.e., Journal of Marketing, Journal of Marketing Research, Marketing Science, Journal of the Academy of Marketing Science, Journal of Retailing, and Industrial Marketing Man- agement). The remaining four journals in that study (i.e., Journal of Consumer Research, Harvard Business Review, Management Science, and Advances in Consumer Research) on average have published only .8% of in- ternational marketing–related articles from 1975 to 2004 and are not typical publication outlets for marketing strategy studies (Leonidou et al. 2010). Because all six journals are based in the United States, we further added one international journal, International Journal of Research in Marketing, which is considered a top marketing journal in Europe (Kumar, Sharma, and Gupta 2017; Roberts, Kayande, and Stremersch 2014).
From the international business discipline, we added three of the six top journals from Dubois and Reeb’s (2000) study (i.e., Journal of International Business Studies, Journal of International Marketing, and In- ternational Marketing Review). These are the most in- fluential international business journals (Leonidou et al. 2010) focusing on marketing rather than management, whereas the remaining journals (i.e., Management In- ternational Review, Journal of World Business, and In- ternational Studies of Management and Organization) focus on management.
These considerations led us to select ten journals: Journal of Marketing, Journal of Marketing Research, Marketing Science, Journal of the Academy of Mar- keting Science, Journal of Retailing, Industrial Marketing Management, International Journal of Research in Mar- keting, Journal of International Business Studies, Journal of International Marketing, and International Marketing Review. Eligible articles were identified by an issue-by- issue manual search for qualitative and empirical articles that have “marketing capability(ies),” “marketing com- petence(s),” “capabilities,” and/or “competences” in their title, abstract, and/or keywords. We performed this search in EBSCO and the journals’ websites.
Following procedures recommended for literature review articles (e.g., Katsikeas et al. 2016; Lipsey and Wilson 2001), when further examination was required, two
62 Journal of International Marketing
experienced researchers separately examined the articles to determine inclusion. Five criteria had to be satisfied for a study to be eligible for this review: (1) the focus of the study is on marketing capabilities,1 either as a primary objective or as part of a wider research design; (2) the study examines firms engaged in international business—that is, the firms’ operations and/or markets span multiple countries (e.g., multinational corporations [MNCs]) or the firm has export ventures, international new ventures/international joint ven- tures (IJVs), or international logistics/outsourcing businesses— or the study examines firms from multiple countries; (3) the unit of analysis is at the international microbusiness level (e.g., export venture, international venture), that is, the international context is a focus of the study rather than only a part of the sampling or a control variable; (4) the study is evidence based (vs. purely conceptual) in nature, such as empirical studies using primary and/or secondary data, or qualitative research such as case studies and meta-analyses; and(5)theresearchwaspublishedsince1999(becauseveryfew studies of marketing capabilities were conducted before this period; Vorhies, Harker, and Rao 1999).
A total of 57 articles remained after this filtering process. Average interrater agreement was 93%, and we dis- cussed all remaining discrepancies to reach consensus. Finally, we supplemented the search process by scanning the reference lists of the collected articles to identify any additional relevant articles missed through the keyword searches. This produced an additional 7 articles from top management journals (Strategic Management Journal, Journal of Management, and Decision Sciences), for a total of 64 articles included in this review. For each of these 64 published studies, we then cataloged (1) how they define marketing capabilities and the theories on which the conceptualization draws; (2) the types of marketing capabilities identified and/or examined; (3) the marketing capability operationalization and analysis method used (for empirical studies); and (4) findings re- ported in the empirical studies with respect to antecedents, consequences, moderators, and mediators connected with marketing capabilities in international marketing. The
answers to these four questions are summarized in the various tables and discussed in more detail next.
Marketing Capabilities
Definition and Theory. In the general marketing literature, marketing capabilities are viewed in terms of a firm’s ability to use available resources to perform marketing tasks in ways that achieve desired marketing outcomes (Day 1994; Morgan, Katsikeas, and Vorhies 2012). They therefore represent the processesthatafirmusestodefine,develop,communicate,and deliver value to its target customers by combining, trans- forming, and deploying its available resources (e.g., Bahadir, Bharadwaj, and Srivastava 2008; Morgan and Slotegraaf 2012). In the international marketing context, most studies define firm-level marketingcapabilities in thesame way asthey are defined in the general marketing literature in domestic market contexts and simply emphasize that the marketing activities and the processes by which they are accomplished take place in international markets to fulfill international customers’ needs and achieve international marketplace goals (e.g., Lages, Silva, and Styles 2009; Shi et al. 2005; Zou, Fang, and Zhao 2003). Thus, firm-level marketing capabilities in international marketing are generally viewed in terms of a firm’s ability to use available resources to understand and fulfill foreign market customer needs better than its rivals. Tables 1–3 provide a review of different marketing capa- bilities identified in the international marketing literature.
A range of different theories are used to ground con- ceptualizations of marketing capabilities and hypothe- size concerning their relationships with other phenomena in international marketing (see Web Appendix A). Un- surprisingly, as in the general marketing literature the majority of these draw on RBV theory. A large number also draw on dynamic capabilities (DC) theory, which, given the difficultiesassociatedwithmeasuringdynamicphenomena,can cause problems in matching theory to operationalization in manystudiesusingprimarysurveyresearchdesigns.Arangeof other theories used in domestic marketing contexts have also been applied in the internal marketing context, including organizational learning and the knowledge-based view. However, in a surprising number of studies (10 of the 64 studies in our sample), it is unclear what specific theory is being drawn upon to support the conceptualization of marketing capabilities in international markets.
The one theoretical viewpoint that is not used in the general marketing literature in domestic market contexts2 that has
1Marketing capabilities include but are not limited to pricing, new product development, promotion, distribution, channel, brand management, and market-based learning ca- pabilities (for a comprehensive list, see Morgan and Slotegraaf 2012). We excluded terms relating to idiosyncratic capabil- ities, such as “MNC/exporter,” “exploration/exploitation,” “globalization/internationalization,” “multicultural,” “(dynamic) net- working,” “technology/IT,” “MNC/global human resource management,”“(marketing)alliance(formation),”“dynamic/absorptive/ learning,” “knowledge management,” “commercial,” “local supplier/ distributor,” “international partners,” and “global supply chain” capabilities (e.g., Usui, Kotabe, and Murray 2017).
2The only exceptions here concern studies of firms that are based in an emerging market.
Marketing Capabilities in International Marketing 63
Table 1. Representative Qualitative (Case Study) Research on Marketing Capabilities in International Marketing
Marketing Capabilities (MCs) Identified Selected Findings Authors
Dynamic MCs (incremental, renewing, and regenerative)
Case studies from six international new ventures from Ireland, Swe- den, and Denmark suggest that different stakeholder groups (allied, cooperative, neutral, and entrepreneur) can influence the learning processes (single-, double-, and triple-loop) of the firm and can determine the nature of dynamic MCs needed for global competitive advantage.
Evers, Andersson, and Hannibal (2012)
The ability to sense and meet customers’ demands
Interviews with 48 European, Chinese, and other managers and experts from Chinese emerging market firms operating in Europe suggest that limited motivation, few opportunities, and restricted ability constrain firms from building and deploying MCs. Authors propose that causal ambiguity, internal perception gaps, and lack of or fragmented general marketing expertise constrain building MCs, while inertia, market resistance, and limited specific marketing expertise constrain deploying MCs.
Kaufmann and Roesch (2012)
Global brand management strategy/capability and regional MCs
Global brand strategy development at Kimberly-Clark entails sharing information and best practices, implementing common brand planning processes, assigning responsibilities for global branding, and creating and implementing effective brand-building strategies. Kimberly-Clark’s approach, predicated on accountable empower- ment and capacity building, improves local MCs while also instilling better processes and disciplines centrally.
Matanda and Ewing (2012)
Market-based learning capability
Findings from a case study of four business process outsourcing firms in India (two Indian, one multinational, and one U.K. joint venture) suggest that effective knowledge transfer and diffusion and the development of market-based organizational learning capabilities are driven by the strength of a firm’s quality management capabilities.
Malik, Sinha, and Blumenfeld (2012)
Various MCs The authors examine case studies of 47 B2B firms (42 global firms) and identify six key marketing capabilities that tie to 14 distinct in- novation-based sustainability strategies, sustainable consumption behavior, and firm performance.
Mariadoss, Tansuhaj, and Mouri (2011)
Seven dynamic capabilities for multichannel transformation
Using case studies of three international firms and one U.K. firm, the study identifies seven dynamic capabilities for multichannel trans- formation and finds that three integrative capabilities are critical to route-to-market multichannel transformation: IT-related, organi- zational structure, and metrics/rewards.
Wilson and Daniel (2007)
Global account MCs: intelli- gence acquisition, coordina- tion, and reconfiguration
Study of 33 global firm cases finds that companies that proactively and systematically implement these processes (intelligence acquisition, coordination, and reconfiguration) are likely to outperform their competitors in the global marketplace.
Shi et al. (2005)
Cross-firm dispersed new product codevelopment capabilities across countries
Study of multiple and dispersed activities in the cross-firm new product development process across the United Kingdom, the United States, and China shows that firms’ interorganizational ability to collec- tively specify and synchronize development activities drives collab- orative cross-firm new product development efforts.
Perks (2005)
64 Journal of International Marketing
Ta bl e 2.
Re pr es en ta tiv e Su rv ey -B as ed
M ar ke tin g Ca pa bi lit ie s Re se ar ch
in In te rn at io na l M ar ke tin g
K ey
M ar k et in g C ap
ab il it ie s
(M C s)
Id en ti fi ed
P er fo rm
an ce
M ea su re
St u d y D es ig n an
d Sa m p le
Se le ct ed
F in d in gs
A u th o rs
A rc h it ec tu ra l ca p ab
il it ie s (i .e .,
p la n n in g ca p ab
il it y an
d im
p le m en ta ti o n ca p ab
il it y)
an d M
C s
Su b je ct iv e:
C o st
ad va
n ta ge ,
d if fe re n ti at io n ad
va n ta ge , an
d ve n tu re
fi n an
ci al
p er fo rm
an ce
(R O I, re tu rn
o n sa le s, m ar gi n s,
re ac h in g fi n an
ci al
go al s)
C ro ss -s ec ti o n al : 4 4 6 U .K .
ex p o rt
ve n tu re s
P la n n in g an
d im
p le m en ta ti o n ca p ab
il it ie s p la y
im p o rt an
t ro le s in
m in im
iz in g st ra te gi c go
al –
re al iz ed
st ra te gi c p o si ti o n ga
p s. B u si n es se s
w it h st ro n ge r m ar k et in g ca p ab
il it ie s ar e b et te r
ab le to
ac h ie ve
d if fe re n ti at io n ad
va n ta ge s an
d th er eb y en jo y su p er io r p er fo rm
an ce .
Sp yr o p o u lo u et
al .
(2 0 1 7 )
In fo rm
at io n al , p ro d u ct
d ev el -
o p m en t, an
d cu st o m er
re la -
ti o n sh ip
ca p ab
il it ie s
Su b je ct iv e: In te n d ed
co st ef fi ci en cy
an d in te n d ed
m ar k et in g
d if fe re n ti at io n
C ro ss -s ec ti o n al : 3 1 2
B ri ti sh
m an
u fa ct u re rs
in vo
lv ed
in ex p o rt in g
M C s st ro n gl y in fl u en ce
ex p o rt er s’ in te n ti o n s to
em p h as iz e b o th
co st ef fi ci en cy
an d m ar k et in g
d if fe re n ti at io n . F ir m s w it h an
al re ad
y es ta b li sh ed
m ar k et
p o si ti o n re ve al
a cl ea r
ef fe ct
o f in fo rm
at io n al
ca p ab
il it y o n
m ar k et in g d if fe re n ti at io n an
d o f p ro d u ct
d ev el o p m en t ca p ab
il it y o n ef fi ci en cy
in te n ti o n s.
K al ek a an
d M
o rg an
(2 0 1 7 )
E -c o m m er ce
M C s
Su b je ct iv e:
E x p o rt
ve n tu re
e- co m m er ce
p er fo rm
an ce ;
O b je ct iv e:
Sa le s
C ro ss -s ec ti o n al : 3 4 0
A u st ra li an
ex p o rt
ve n tu re s
Sp ec ia li ze d e- co m m er ce
M C s d ir ec tl y in cr ea se
d eg re e o f d is tr ib u ti o n an
d co m m u n ic at io n
ef fi ci en cy , w h ic h in
tu rn
le ad
s to
en h an
ce d
ex p o rt
m ar k et
p er fo rm
an ce .
G re go
ry , N go
, an
d K ar av
d ic
(2 0 1 7 )
E x p o rt
M C s: E x p o rt
m ar k et
in te ll ig en ce , p ro d u ct
d ev el o p -
m en t, co m m u n ic at io n , p ri c-
in g, d is tr ib u ti o n an
d af te r- sa le
se rv ic e ca p ab
il it ie s
Su b je ct iv e:
E x p o rt
p er fo rm
an ce
C ro ss -s ec ti o n al : 3 3 3
V ie tn am
es e ex p o rt in g
fi rm
s
A fi rm
’s re la ti o n al ca p ab
ili ty
n o t o n ly st re n gt h en s
th e ef fi ci en cy
o f ex p o rt p er fo rm
an ce
as re la te d
to p ri ci n g,
in te lli ge n ce , an
d co m m u n ic at io n
ca p ab
ili ti es
b u t al so
is th e st ro n ge st p re d ic to r o f
ex p o rt p er fo rm
an ce
am o n g th o se
ca p ab
ili ti es .
P h am
, M
o n k h o u se ,
an d B ar n es
(2 0 1 7 )
M et a- an
al ys is o f M
C s
Su b je ct iv e:
N ew
p ro d u ct
p er fo rm
an ce
5 0 st u d ie s w it h 3 4 1
m ar k et in g ca p ab
il it y–
n ew
p ro d u ct
p er fo r-
m an
ce ef fe ct
si ze s fr o m
1 7 co u n tr ie s
M C s h av
e a st ro n ge r in fl u en ce
th an
te ch n o -
lo gi ca l ca p ab
il it ie s o n n ew
p ro d u ct
p er fo r-
m an
ce ;t h is ef fe ct is m o d er at ed
b y in st it u ti o n al
co n te x t fa ct o rs . T h e re la ti ve
ad va
n ta ge
d e-
cr ea se s an
d ev en
re ve rs es
w it h in cr ea si n g
gr o w th
ra te s, fu rt h er
d ec re as es
w it h st ro n ge r
ru le
o f la w
in a co u n tr y,
an d in cr ea se s in
so ci et ie s em
p h as iz in g se lf -e x p re ss io n vs .
su rv iv al
va lu es .
E is en d , E va
n sc h it zk y,
an d C al an
to n e
(2 0 1 6 )a
Marketing Capabilities in International Marketing 65
Ta bl e 2.
Co nt in ue d
K ey
M ar k et in g C ap
ab il it ie s
(M C s)
Id en ti fi ed
P er fo rm
an ce
M ea su re
St u d y D es ig n an
d Sa m p le
Se le ct ed
F in d in gs
A u th o rs
K n o w le d ge
co m p et en ce
(c u s-
to m er
k n o w le d ge
co m p et en ce
an d co m p et it o r k n o w le d ge
co m p et en ce )
Su b je ct iv e:
F ir m
p er fo rm
an ce
(t w o -y ea r sa le s gr o w th , R O I,
p ro fi t)
C ro ss -s ec ti o n al : 6 7 4
N P D
an d /o r la u n ch
m an
ag er s in
th e U n it ed
St at es
(N = 2 8 8 ) an
d C h in a (N
= 3 8 6 )
K n o w le d ge
co m p et en ci es
m ed ia te
th e p o si ti ve
re la ti o n sh ip s b et w ee n o ri en ta ti o n s an
d m ar k et -b as ed
in n o va
ti o n . M
ar k et -b as ed
in -
n o va
ti o n m ed ia te s th e p o si ti ve
re la ti o n sh ip s
b et w ee n cu st o m er
an d co m p et it o r k n o w le d ge
co m p et en ci es
an d o ve ra ll fi rm
p er fo rm
an ce .
In U .S . vs . C h in es e fi rm
s, cu st o m er
(c o m p et -
it o r) o ri en ta ti o n le ad
s to
b o th
h ig h er
cu st o m er
(c o m p et it o r)
k n o w le d ge
co m p et en ce
an d
en h an
ce d m ar k et -b as ed
in n o va
ti o n .
O zk ay
a et
al . (2 0 1 5 )
M et a- an
al ys is o f p ro d u ct ,
p ri ci n g,
d is tr ib u ti o n , an
d co m m u n ic at io n ca p ab
il it ie s
Su b je ct iv e:
E x p o rt
p er fo rm
an ce
(f in an
ci al
an d n o n fi n an
ci al )
1 1 st u d ie s o f 1 3 5 ef fe ct s
o f M C – co m p et it iv e
ad va n ta ge – p er fo rm
an ce
re la ti o n sh ip
T w o ty pe s of
co m pe ti ti ve
ad va nt ag e (i .e ., lo w -c os t
ad va nt ag e an d di ff er en ti at io n ad va nt ag e)
po si -
ti ve ly
m ed ia te
th e ef fe ct
of M C s (e xc ep t fo r
di st ri bu
ti on
ca pa bi lit y)
on fi na nc ia l an d no
nf i-
na nc ia l ex po
rt pe rf or m an ce .
T an
an d So
u sa
(2 0 1 5 )a
M ar k et
se n si n g,
cu st o m er
en -
ga gi n g,
an d p ar tn er
li n k in g
ca p ab
il it ie s
Su b je ct iv e:
N P D
p er fo rm
an ce
C ro ss -s ec ti o n al : 3 2 4 U .S .
fi rm
s an
d 5 6 9 C h in es e
fi rm
s
M C is po
si tiv el y as so ci at ed
w ith
N PD
pe rf or m an ce .
E x p lo it at io n an
d ex p lo ra ti o n re sp ec ti ve ly
m ed ia te
th e m ar k et in g ca p ab
ili ty – N P D
p er fo rm
an ce
re la ti o n sh ip . C u st o m er -b as ed
st ru ct u re , d ec en tr al iz at io n , an
d in te rf u n ct io n al
in te gr at io n
p o si ti ve ly
m o d er at e th e m ar k et in g ca p ab
ili ty –
N P D
p er fo rm
an ce
re la ti o n sh ip .
M u (2 0 1 5 )
M N C s’ p ro d u ct
in n o va
ti o n
ca p ab
il it y
N .A .
C ro ss -s ec ti o n al : 8 6
T ai w an
-b as ed
M N C s
T h er e is a n eg at iv e d ir ec t re la ti o n sh ip
b et w ee n su b si d ia ry
ta ci t- k n o w le d ge
le ve l an
d M
N C s’ p ro d u ct
in n o va
ti o n ca p ab
il it y.
Sh en g et
al . (2 0 1 5 )
P ro d u ct d ev el o p m en tc ap
ab il it y
N .A .
C ro ss -s ec ti o n al : 4 7 1
P o rt u gu
es e ex p o rt in g
m an
u fa ct u ri n g fi rm
s
P ro d u ct
d ev el o p m en t ca p ab
il it y is p o si ti ve ly
an d si gn
if ic an
tl y as so ci at ed
w it h ex p o rt
ve n tu re
p er fo rm
an ce .
V ic en te , A b ra n te s,
an d T ei x ei ra
(2 0 1 5 )
66 Journal of International Marketing
Ta bl e 2.
Co nt in ue d
K ey
M ar k et in g C ap
ab il it ie s
(M C s)
Id en ti fi ed
P er fo rm
an ce
M ea su re
St u d y D es ig n an
d Sa m p le
Se le ct ed
F in d in gs
A u th o rs
D is tr ib u ti o n n et w o rk , b ra n d
m an
ag em
en t, an
d p ro d u ct
in n o va
ti o n ca p ab
il it ie s
O b je ct iv e:
P ro b ab
il it y o f p re se n ce
in em
er gi n g m ar k et s (E M
s) C ro ss -s ec ti o n al : 2 7 1
It al ia n m an
u fa ct u re rs
in vo
lv ed
in ex p o rt in g
F ir m s th a t ex
p a n d ed
th ei r b u si n es s in
E M
s sh o w ed
a si g n if ic a n tl y h ig h er
en d o w m en
t o f
M C s co
m p a re d w it h fi rm
s ex
p o rt in g o n ly
in a d v a n ce d m ar k et s.
M o re o ve r,
fi rm
si ze
is ir re le v a n t: ev en
sm a ll fi rm
s ca n re a ch
E M
s b y le v er a g in g a n a p p ro p ri a te
se t o f
ca p a b il it ie s.
B o rt o lu zz i et
al .
(2 0 1 4 )
P ro d u ct m an
ag em
en tc ap
ab il it y
Su b je ct iv e:
IJ V
p er fo rm
an ce
(R O I
an d sa le s gr o w th )
C ro ss -s ec ti o n al :1
5 6 IJ V s
in C h in a
T ec h n o lo gy
an d cu st o m er
o ri en ta ti o n s h av
e a p o si ti ve
ef fe ct o n IJ V p ro d u ct d if fe re n ti at io n
ca p ab
il it y,
an d th is ef fe ct
is co n ti n ge n t o n
fo re ig n p ar en t co n tr o l.
C h en , C h en , an
d Z h o u (2 0 1 4 )
M ar k et -b as ed
ca p ab
il it ie s: in -
fo rm
at io n , re la ti o n sh ip s, an
d n ew
p ro d u ct
d ev el o p m en t
(N P D ) ca p ab
il it ie s
Su b je ct iv e:
E x p o rt
p er fo rm
an ce
(s tr at eg ic
an d sa ti sf ac ti o n )
C ro ss -s ec ti o n al :1
5 0 sm
al l
an d m ed iu m -s iz ed
ex p o rt er s in
A u st ra lia
A cc es s to
lo ca ti o n -s p ec if ic
ad va
n ta ge s (i .e .,
ac ce ss
to so u rc es
o f su p p ly , go
ve rn m en
t ag
en ci es , ex
p o rt -r el at ed
se rv ic es
an d in fr a-
st ru ct u re , m a n a ge ri al
la b o r sk il ls , an
d n et -
w o rk
o p p o rt u n it ie s)
is an
es se n ti al
an te ce d en
t fo r th e fi rm
’s ab
il it y to
d ev el o p
ex p o rt -r el at ed
re so u rc es
an d ca p a b il it ie s th at
d ri v e ex
p o rt
p er fo rm
an ce
o u tc o m es .
F re em
an an
d St yl es
(2 0 1 4 )
C h an
n el
n et w o rk in g ca p ab
il it y
Su b je ct iv e:
E x p o rt
p er fo rm
an ce
(p ro fi ta b il it y,
p ro fi t gr o w th , an
d m ar gi n s) ;
O b je ct iv e:
E x p o rt
p er fo rm
an ce
(e x p o rt
sa le s tu rn o ve r an
d av
er -
ag e to ta l ex p o rt
p ro fi t)
L o n gi tu d in al : 1 6 0 sm
al l
an d m ed iu m -s iz ed
ex p o rt er s in
G h an
a in
ye ar s t an
d t + 3 ;
C ro ss -s ec ti o n al : 1 1 7
fi rm
s in
B o sn ia
an d
H er ze go
vi n a
In n o va
ti ve n es s is m o st
b en
ef ic ia l fo r fi rm
s o p er at in g in
co m p et it iv e an
d d y n a m ic ex
p o rt
m a rk et s; th o se
in le ss
co m p et it iv e an
d m o re
st at ic
m a rk et s d o n o t b en
ef it fr o m
th ei r in -
n o va
ti o n ac ti vi ti es
to th e sa m e ex
te n t.
St ro n ge r n et w o rk in g ca p a b il it ie s an
d a m o re
o rg an
ic st ru ct u re
al so
en h a n ce
th e
in n o v at iv en
es s– ex
p o rt
p er fo rm
an ce
re la ti o n sh ip .
B o so
et al . (2 0 1 3 )
Marketing Capabilities in International Marketing 67
Ta bl e 2.
Co nt in ue d
K ey
M ar k et in g C ap
ab il it ie s
(M C s)
Id en ti fi ed
P er fo rm
an ce
M ea su re
St u d y D es ig n an
d Sa m p le
Se le ct ed
F in d in gs
A u th o rs
A rc h it ec tu ra l M
C s: m ar k et in g
p la n n in g an
d m ar k et
in fo r-
m at io n ac q u is it io n , in te rp re -
ta ti o n , an
d d is se m in at io n ;
sp ec ia li ze d M
C s: p ri ci n g,
p ro d u ct
d ev el o p m en t, ch an
- n el an
d d el iv er y m an
ag em
en t,
af te r- se rv ic e se ll in g,
an d m ar -
k et in g co m m u n ic at io n
Su b je ct iv e:
M ar k et
an d fi n an
ci al
p er fo rm
an ce
C ro ss -s ec ti o n al : 2 1 9 U .K .
ex p o rt in g
m an
u fa ct u re rs
A rc h it ec tu ra l an
d sp ec ia li ze d M
C s p o si ti ve ly
im p ac t ex
p o rt
ve n tu re s’
in te rn a l m a rk et in g
st ra te g y im
p le m en
ta ti o n , w h ic h in
tu rn
p o s-
it iv el y im
p a ct s ex
te rn a l m ar k et in g st ra te g y
im p le m en
ta ti o n ef fe ct iv en
es s an
d ex
p o rt
ve n tu re
m a rk et
an d fi n a n ci a l p er fo rm
an ce .
A rc h it ec tu ra l (s p ec ia li ze d ) M
C s al so
d ir ec tl y
d et er m in e ex
p o rt
ve n tu re
fi n a n ci al
(m ar k et )
p er fo rm
an ce . M
C in te g ra ti o n is p o si ti ve ly
re la te d to
m a rk et in g st ra te g y im
p le m en
ta ti o n
ef fe ct iv en
es s.
M o rg an
, K at si k ea s,
an d V o rh ie s (2 0 1 2 )
V ar io u s M
C s
Su b je ct iv e:
M ar k et
p er fo rm
an ce
(m ar k et
sh ar e)
an d fi n an
ci al
p er fo rm
an ce
(t w o -y ea r la gg ed
re tu rn
o n as se ts )
C ro ss -s ec ti o n al : 1 9 2
C h in es e fi rm
s an
d IJ V s
o r fo re ig n w h o lly
o w n ed
fi rm
s in
C h in a
M C
h as
a p o si ti ve
im p ac t o n b o th
m ar k et
an d
fi n an
ci al
p er fo rm
an ce , an
d b o th
p u re
im it a-
ti o n an
d cr ea ti ve
im it at io n , w h en
co u p le d
w it h st ro n g M
C s, p o si ti ve ly
af fe ct
m ar k et
p er fo rm
an ce .
L ee
an d Z h o u (2 0 1 2 )
C u st o m er
re la ti o n sh ip
m an
- ag
em en t, p ro d u ct
d ev el o p -
m en t m an
ag em
en t, an
d su p p ly
ch ai n m an
ag em
en t
ca p ab
il it ie s
Su b je ct iv e:
F ir m s’ in te rn at io n al
gr o w th
C ro ss -s ec ti o n al : 1 5 9
yo u n g in te rn at io n al
fi rm
s in
C h in a
E a rl y fo re ig n m a rk et
en tr y en
h a n ce s a y o u n g
v en
tu re ’s
M C s,
w h ic h in
tu rn
le a d s to
in -
te rn a ti o n a l g ro w th . Y o u n g ve n tu re s im
- p ro v e th ei r M
C s m o re
w h en
se n io r
m an
a ge rs
a re
h ig h ly
co m m it te d to
fo re ig n
m a rk et s. Im
p a ct o f M
C s o n th e p er fo rm
a n ce
o u tc o m es
o f ea rl y in te rn a ti o n a li za ti o n is
g re a te r in
v en
tu re s ta rg et in g d ev el o p ed
vs .
em er gi n g m a rk et s.
Z h o u , W
u , an
d B ar n es
(2 0 1 2 )
Sp ec ia li ze d M
C s: p ri ci n g,
p ro d u ct
d ev el o p m en t,
d is tr ib u ti o n , an
d m ar k et in g
co m m u n ic at io n ca p ab
il it ie s
N .A .
C ro ss -s ec ti o n al : 8 9 1
fi rm
s ac ro ss
fo u r co u n -
tr ie s (C
h in a,
G er m an
y, H o n g K o n g,
an d th e
U n it ed
St at es )
So ci al
ca p it al — m an
ag er ia l ti e u ti li za ti o n , tr u st ,
an d so li d ar it y—
is a st ro n g d ri ve r o f th e fo u r
M C s. M
an ag
er ia lt ie u ti li za ti o n an
d so li d ar it y
te n d to
b e m o re
im p o rt an
t w h en
th e n at io n al
cu lt u re ’s p o w er
d is ta n ce
is lo w ,c o ll ec ti vi sm
is h ig h , an
d u n ce rt ai n ty
av o id an
ce is lo w ,
w h er ea s th e ef fe ct
o f tr u st
is n o t su b je ct
to n at io n al
cu lt u ra l va
ri at io n s.
K em
p er ,E
n ge le n ,a
n d
B re tt el
(2 0 1 1 )
68 Journal of International Marketing
Ta bl e 2.
Co nt in ue d
K ey
M ar k et in g C ap
ab il it ie s
(M C s)
Id en ti fi ed
P er fo rm
an ce
M ea su re
St u d y D es ig n an
d Sa m p le
Se le ct ed
F in d in gs
A u th o rs
In fo rm
at io n al , cu st o m er
re la ti o n sh ip , an
d p ro d u ct
d ev el o p m en t ca p ab
il it ie s
Su b je ct iv e:
E x p o rt
ve n tu re
p er fo r-
m an
ce (m
ar k et
sh ar e,
p ro fi ta b il -
it y,
an d re ve n u e)
C ro ss -s ec ti o n al : 3 1 2
U .K .- b as ed
ex p o rt in g
m an
u fa ct u re rs
E x p o rt in g ex p er ie n ce
n u rt u re s cu st o m er
re la -
ti o n sh ip s an
d in fo rm
at io n al
ca p ab
il it ie s, an
d av
ai la b il it y o ff in an
ce fa ci li ta te s in fo rm
at io n al
an d p ro d u ct
d ev el o p m en t ca p ab
il it ie s an
d en ab
le s ex p o rt er s to
ac h ie ve
se rv ic e ad
va n ta ge
an d su p er io r ve n tu re
p er fo rm
an ce
in th e
o ve rs ea s m ar k et s.
K al ek a (2 0 1 1 )
O ve rs ea s m ar k et -r el at ed
ex -
p lo it at iv e an
d ex p lo ra ti ve
ca p ab
il it ie s, an
d p ro d u ct -
d ev el o p m en t ex p lo it at iv e
an d ex p lo ra ti ve
ca p ab
il it ie s
Su b je ct iv e:
M ar k et
ef fe ct iv en es s
C ro ss -s ec ti o n al : 2 5 4
P o rt u gu
es e ex p o rt
m an
u fa ct u re rs
E n tr ep re n eu ri al
o ri en ta ti o n is a p re cu rs o r o f
ex p lo it at iv e an
d ex p lo ra ti ve
p ro d u ct
d ev el -
o p m en t an
d o ve rs ea s m ar k et – re la te d ca p a-
b il it ie s. P ro d u ct
d ev el o p m en t ex p lo ra ti ve
ca p ab
il it ie s an
d o ve rs ea s m ar k et – re la te d
ex p lo it at iv e ca p ab
il it ie s h av
e a p o si ti ve
ef fe ct
o n n ew
p ro d u ct
d if fe re n ti at io n , w h ic h in
tu rn
en h an
ce s m ar k et
ef fe ct iv en es s.
L is b o a,
Sk ar m ea s,
an d L ag
es (2 0 1 1 )
B u si n es s id en ti fi ca ti o n ,
re la ti o n sh ip -b u il d in g,
an d
p ro d u ct -m
ar k et
d ev el o p m en t
ca p ab
il it ie s
Su b je ct iv e:
E x p o rt
m ar k et
p er fo rm
an ce
an d ex p o rt
fi n an
ci al
p er fo rm
an ce
C ro ss -s ec ti o n al : 2 2 3
U .K . ex p o rt in g fi rm
s A d o p ti o n o fs p ec if ic n at io n al ex p o rt -p ro m o ti o n
p ro gr am
s st re n gt h en s fi rm
s’ ex p o rt -r el at ed
re so u rc es
an d ca p ab
il it ie s, w h ic h in
tu rn
d ri ve
d ev el o p m en t o f a so u n d ex p o rt
m ar k et in g
st ra te gy
, co m p et it iv e ad
va n ta ge s, an
d su p er io r ex p o rt
p er fo rm
an ce .
L eo n id o u , P al ih aw
a- d an
a, an
d T h eo d o -
si o u (2 0 1 1 )
P ri ci n g,
n ew
d ev el o p m en t
ca p ab
il it y,
an d m ar k et in g
co m m u n ic at io n ca p ab
il it ie s
Su b je ct iv e: F in an
ci al
p er fo rm
an ce ,
st ra te gi c p er fo rm
an ce , an
d p ro d u ct
p er fo rm
an ce ;
O b je ct iv e:
re tu rn
o n as se ts
(R O A )
fo r 2 7 1 fi rm
s
C ro ss -s ec ti o n al : 4 9 1
ex p o rt
ve n tu re s b as ed
in C h in a (2 4 0 C h in es e
an d 2 5 1 n o n -C
h in es e
fi rm
s fr o m
U n it ed
St at es , E u ro p e,
Ja p an
, an
d H o n g K o n g)
M C s m ed
ia te
th e m a rk
et o ri en
ta ti o n
(M O )– p er fo rm
a n ce
re la ti o n sh
ip , w h il e
co m p et it iv e a d v a n ta g es
p a rt ia ll y m ed
ia te
th e M
C – p er fo rm
a n ce
re la ti o n sh
ip . C o o r-
d in a ti o n m ec h a n is m
st re n g th en
s a n d co
st le a d er sh
ip st ra te g y w ea
k en
s th e ef fe ct
o f
M O
o n N P D
a n d m a rk
et in g co
m m u n ic a -
ti o n ca
p a b il it ie s,
re sp
ec ti v el y . M
a rk
et tu r-
b u le n ce
a tt en
u a te s th e ef fe ct
o f M
O o n
N P D
ca p a b il it y , w h il e co
m p et it iv e in te n -
si ty
st re n g th en
s th is
ef fe ct .
M u rr ay
, G ao
, an
d K o ta b e (2 0 1 1 )
Marketing Capabilities in International Marketing 69
Ta bl e 2.
Co nt in ue d
K ey
M ar k et in g C ap
ab il it ie s
(M C s)
Id en ti fi ed
P er fo rm
an ce
M ea su re
St u d y D es ig n an
d Sa m p le
Se le ct ed
F in d in gs
A u th o rs
P ro d u ct
o ff er in g,
p ri ci n g,
d is -
tr ib u ti o n , co m m u n ic at io n ,
an d m ar k et in g p la n n in g an
d im
p le m en ta ti o n ca p ab
il it ie s
Su b je ct iv e:
M ar k et p la ce
p er fo rm
an ce
C ro ss -s ec ti o n al : 3 0 0
A u st ra li an
an d 2 5 9
V ie tn am
es e
m an
u fa ct u ri n g fi rm
s
M C m ed ia te s th e ef fe ct s o f th e fi rm
’s M
O o n it s
p er fo rm
an ce ; in te ra ct io n o f in n o va
ti o n an
d M
C s si gn
if ic an
tl y in fl u en ce s fi rm
s’ m ar k et -
p la ce
p er fo rm
an ce
m o re
th an
ea ch
d o es
in d iv id u al ly ; M
O p ar ti al ly
m ed ia te s th e
re la ti o n sh ip
b et w ee n en tr ep re n eu ri al
o ri en ta ti o n an
d in n o va
ti o n an
d M
C s.
O ’C as s an
d N go
(2 0 1 1 )
In te rn at io n al
cu st o m er -s u p p o rt
ca p ab
il it y
Su b je ct iv e:
Im p ro ve d o rg an
iz a-
ti o n al
le ar n in g an
d p er fo rm
an ce
C ro ss -s ec ti o n al : 1 7 3
in te rn at io n al
n ew
ve n tu re s fr o m
C h in a
an d In d ia
In ve st m en ts
in in te rn at io n al
cu st o m er
su p p o rt
ca p ab
il it ie s ar e as so ci at ed
w it h im
p ro ve d
o rg an
iz at io n al
le ar n in g an
d p er fo rm
an ce .
G lo b al iz at io n p ay
s o ff w h en
en tr ep re n eu ri al
fi rm
s fr o m
em er gi n g ec o n o m ie s in ve st
in o n go
in g su p p o rt
o f th ei r m o st
im p o rt an
t in te rn at io n al
cu st o m er s.
K h av
u l et
al . (2 0 1 0 )
In fo rm
at io n ac q u is it io n an
d ad
ap ti ve
ca p ab
il it ie s
Su b je ct iv e:
In te rn at io n al
p er fo r-
m an
ce (g ro w th , m ar k et
sh ar e,
p ro fi ta b il it y,
R O I, an
d sa ti sf ac ti o n )
C ro ss -s ec ti on
al :7 75
yo un
g an d sm
al l in te rn at io na l-
iz in g en tr ep re ne ur ia l
ex po
rt er s in
C hi na
A d ap
ti ve
ca p ab
il it y m ed ia te s th e re la ti o n sh ip
b et w ee n in st it u ti o n al
ca p it al /m
an ag
er ia l ti es
an d in te rn at io n al
p er fo rm
an ce .
L u et
al . (2 0 1 0 )
D yn
am ic
M C s: p ro d u ct
d ev el o p m en t m an
ag em
en t,
cu st o m er
re la ti o n sh ip , an
d su p p ly
ch ai n m an
ag em
en t
ca p ab
il it ie s
Su b je ct iv e: C o m p et it iv e ad
va n ta ge ;
O b je ct iv e:
Sa le s/ as se ts
an d
p ro fi ts /a ss et s
C ro ss -s ec ti o n al : 1 1 4
m an
u fa ct u ri n g IJ V s in
C h in a
R es o u rc e m ag
n it u d e an
d re so u rc e co m p le -
m en ta ri ty
o f an
IJ V
p o si ti ve ly
in fl u en ce
it s
D yn
am ic
m ar k et in g C ap
ab il it ie s (D
M C s) ,
w h ic h p o si ti ve ly
im p ac t IJ V s’ co m p et it iv e
ad va
n ta ge
an d fi n an
ci al p er fo rm
an ce .M
ar k et
d yn
am is m
p o si ti ve ly
m o d er at es
th e D M
C –
p er fo rm
an ce
re la ti o n sh ip .
F an
g an
d Z o u (2 0 0 9 )
O rg an
iz at io n al
le ar n in g ca p a-
b il it ie s fo r in n o va ti o n , re la -
ti o n sh ip
ca p ab
il it ie s, an
d 1 u al it y ca p ab
il it ie s
Su b je ct iv e:
E x p o rt
p er fo rm
an ce
(e co n o m ic
an d re la ti o n sh ip
p er fo rm
an ce )
C ro ss -s ec ti o n al : 4 1 9
sm al l to
m id si ze
P o rt u -
gu es e ex p o rt er s
R el a ti o n sh ip
ca p a b il it ie s im
p ro v e p ro d u ct
in n o v a ti o n , p ro d u ct
q u a li ty , a n d re la ti o n -
sh ip
p er fo rm
a n ce . Q u a li ty
ca p a b il it ie s a n d
re la ti o n sh ip
ca p a b il it ie s a ff ec t p ro d u ct
q u a li ty , w h ic h im
p ro v es
re la ti o n sh ip
p er fo rm
a n ce .
L ag
es , Si lv a,
an d
St yl es
(2 0 0 9 )
70 Journal of International Marketing
Ta bl e 2.
Co nt in ue d
K ey
M ar k et in g C ap
ab il it ie s
(M C s)
Id en ti fi ed
P er fo rm
an ce
M ea su re
St u d y D es ig n an
d Sa m p le
Se le ct ed
F in d in gs
A u th o rs
M et a- an
al ys is o f M
C s
Su b je ct iv e an
d O b je ct iv e:
F ir m
p er fo rm
an ce
1 1 4 st u d ie s fr o m
U n it ed
St at es
an d o th er
co u n tr ie s
M C h as
a st ro n ge r im
p ac t o n fi rm
p er fo rm
an ce
th an
R & D
an d o p er at io n s ca p ab
il it ie s. O th er
st u d y ch ar ac te ri st ic s (m
ar k et /e ff ic ie n cy
p er fo rm
an ce ; su b je ct iv e/ o b je ct iv e d at a;
fi rm
si ze ; U .S ./ n o n -U
.S .; SB
U /f ir m -l ev el
d at a;
in -
d u st ry ) d o n o t in fl u en ce
M C – p er fo rm
an ce
re la ti o n sh ip .
K ra sn ik o v an
d Ja ya
- ch an
d ra n (2 0 0 8 )a
M ar k et
li n k in g an
d m ar k et in g
ca p ab
il it ie s
N .A .
C ro ss -s ec ti o n al : 7 0 9
fi rm
s ac ro ss
th e U n it ed
St at es , Ja p an
, an
d C h in a
P ro sp ec to rs
h a v e g re a te st
te ch
n ic a l a n d IT
ca p a b il it ie s;
d ef en
d er s a re
su p er io r in
m a r-
k et
li n k in g a n d M
C s a cr o ss
a ll co
u n tr ie s.
U .S . fi rm
s h a v e g re a te r m a rk et
li n k in g ca -
p a b il it ie s th a n C h in es e a n d Ja p a n es e fi rm
s fo r p ro sp ec to rs
a n d d ef en
d er s,
b u t n o t fo r
re a ct o rs . Ja p an
es e a n d C h in es e fi rm
s h av
e g re a te r M
C s th a n U .S . p ro sp ec to rs
an d
a n a ly ze rs .
So n g et
al . (2 0 0 8 )
N et w o rk , o u ts id e- in , in si d e-
o u t, an
d sp an
n in g ca p ab
il it ie s
Su b je ct iv e: E co n o m ic in te rn at io n al
p er fo rm
an ce
C ro ss -s ec ti o n al : 1 9 8
Sp an
is h an
d 3 8 3 B el -
gi an
in te rn at io n al
fi rm
s
M C s h av
e a p o si ti ve
im p ac t o n in te rn at io n al
co m m it m en t, in te rn at io n al
en tr y m o d es , an
d ec o n o m ic
in te rn at io n al
p er fo rm
an ce .
B le sa
an d R ip o ll es
(2 0 0 8 )
L o ca l m ar k et
co m p et en ce
Su b je ct iv e:
M an
u fa ct u re r co m p et -
it iv en es s in
ex p o rt
m ar k et
C ro ss -s ec ti o n al : 1 4 2
re la ti o n sh ip s b et w ee n
U .S . m an
u fa ct u re r an
d in d ep en d en t fo re ig n
d is tr ib u to r in
ex p o rt
m ar k et
A ll th re e go
ve rn an
ce m ec h an
is m s (t ru st ,
k n o w le d ge
sh ar in g,
an d co n tr ac t- b as ed
re la -
ti o n sh ip ) co n tr ib u te to
fi rm
s’ ab
il it y to
ex p lo it
lo ca l m ar k et
o p p o rt u n it y.
L o ca l m ar k et
co m p et en ce
en h an
ce s th e m an
u fa ct u re ’s
co m p et it iv en es s in
th e ex p o rt
m ar k et .
W u et
al . (2 0 0 7 )
C u st o m er
li n k in g,
m ar k et
se n si n g,
an d ch an
n el -b o n d in g
ca p ab
il it ie s
Su b je ct iv e:
P ro fi t, sa le s, an
d R O I
re la ti ve
to o b je ct iv es
o f jo in t
ve n tu re s (J V s)
C ro ss -s ec ti o n al : 4 6 6
U .S . JV
s M
C s p o si ti ve ly
im p ac t JV
p er fo rm
an ce . M
C s
h av
e w ea k er
im p ac t o n JV
p er fo rm
an ce
in te ch n o lo gi ca ll y tu rb u le n t en vi ro n m en ts . T h e
in te ra ct io n o f m ar k et in g an
d te ch n o lo gi ca l
ca p ab
il it ie s si gn
if ic an
tl y im
p ac ts
JV p er fo r-
m an
ce o n ly
in th e h ig h -t u rb u le n ce
en vi ro n m en t.
So n g et
al . (2 0 0 5 )
Marketing Capabilities in International Marketing 71
Ta bl e 2.
Co nt in ue d
K ey
M ar k et in g C ap
ab il it ie s
(M C s)
Id en ti fi ed
P er fo rm
an ce
M ea su re
St u d y D es ig n an
d Sa m p le
Se le ct ed
F in d in gs
A u th o rs
M ar k et
li n k in g an
d m ar k et in g
ca p ab
il it ie s
O b je ct iv e:
P ro fi t m ar gi n , th re e-
ye ar
R O I, R O A , re la ti ve
m ar k et
sh ar e,
cu st o m er
re te n ti o n , sa le s
gr o w th , an
d p ro fi t m ar gi n /s al es /
R O I re la ti ve
to st ra te gi c b u si n es s
u n it (S B U ) o b je ct iv es
C ro ss -s ec ti o n al : 7 0 9 fi rm
s in th re e co un
tr ie s (C h in a,
Ja p an , U ni te d St at es )
D ef en d er s an
d re ac to rs h av
e si gn
if ic an
tl y h ig h er
M C s an
d m ar k et
li n k in g ca p ab
il it ie s th an
o th er
st ra te gy
-t yp
e gr o u p s; th ey
ar e al so
th e
b es t p er fo rm
er s ac ro ss
al l p er fo rm
an ce
m ea -
su re s, ev en
th o u gh
th ey
al so
re p re se n t th e
gr o u p th at
fa ce s th e m o st
u n ce rt ai n m ar k et -
in g,
co m p et it iv e,
an d te ch n o lo gi ca l
en vi ro n m en t.
D eS ar b o et
al . (2 0 0 5 )
C R M
p ro ce ss es
(c ap
ab il it ie s) ,
in cl u d in g cu st o m er
re la ti o n -
sh ip
in it ia ti o n , m ai n te n an
ce ,
an d te rm
in at io n ca p ab
il it ie s
Su b je ct iv e:
O ve ra ll p er fo rm
an ce ,
m ar k et
sh ar e,
gr o w th , an
d cu r-
re n t p ro fi ta b il it y;
O b je ct iv e:
R O A
C ro ss -s ec ti o n al : SB
U s
fr o m
2 1 1 (M
o d el
1 )
an d 9 8 (M
o d el
2 ) B 2 C
fi rm
s fr o m
fo u r in d u s-
tr ie s in
A u st ri a,
G er -
m an
y, an
d Sw
it ze rl an
d
Im p le m en ta ti o n o f th e th re e C R M
p ro ce ss es
(e sp ec ia ll y in it ia ti o n an
d m ai n te n an
ce ) h as
a p o si ti ve
im p ac t o n fi rm
p er fo rm
an ce .
C R M
-c o m p at ib le
o rg an
iz at io n al
al ig n m en t
m o d er at es
th e in it ia ti o n /t er m in at io n –
ca p ab
il it y–
p er fo rm
an ce
re la ti o n sh ip
p o si ti ve ly . C R M
te ch n o lo gy
n eg at iv el y
(p o si ti ve ly ) m o d er at es
th e in it ia ti o n
(t er m in at io n )– ca p ab
il it y–
p er fo rm
an ce
re la ti o n sh ip .
R ei n ar tz , K ra ff t, an
d H o ye r (2 0 0 4 )
In fo rm
at io n al , re la ti o n sh ip -
b u il d in g,
an d p ro d u ct
d ev el o p m en t ca p ab
il it ie s
Su b je ct iv e:
P o si ti o n al
ad va
n ta ge s
an d ex p o rt
ve n tu re
p er fo rm
an ce
(e co n o m ic , d is tr ib u to r an
d en d -u se r p er fo rm
an ce )
C ro ss -s ec ti o n al : 2 8 7
ex p o rt er s th at
ex p o rt
th ro u gh
fo re ig n
d is tr ib u to rs
M C s af fe ct
ex p o rt ve n tu re
co m p et it iv e st ra te gy
ch o ic es
an d th e p o si ti o n al
ad va
n ta ge s
ac h ie ve d in
th e ex p o rt
m ar k et , w h ic h in
tu rn
af fe ct
ex p o rt
ve n tu re
p er fo rm
an ce
o u tc o m es .
M o rg an
, K al ek a,
an d
K at si k ea s (2 0 0 4 )
M ar k et in g co m p et en ce
Su b je ct iv e:
In te rn at io n al
p er fo rm
an ce
C ro ss -s ec ti o n al : 1 0 6
D an
is h an
d 1 8 6 U .S .
b o rn -g lo b al
ex p o rt er s
B o rn -g lo b al
in te rn at io n al
p er fo rm
an ce
is en h an
ce d in
th e w ak
e o f m an
ag er ia le m p h as is
o n fo re ig n cu st o m er
fo cu s an
d m ar k et in g
co m p et en ce .
K n ig h t, M
ad se n , an
d Se rv ai s (2 0 0 4 ) IM
R
R el at io n sh ip
le ar n in g
ca p ab
il it y
Su b je ct iv e:
R el at io n sh ip
p er fo rm
an ce
C ro ss -s ec ti o n al : 3 1 5
re la ti o n sh ip
d ya
d s in
Sc an
d in av
ia n se ll er s
an d E u ro p ea n b u ye rs
L ea rn in g ca p ab
il it y o f a re la ti o n sh ip
h as
a st ro n g,
p o si ti ve
ef fe ct
o n p er fo rm
an ce .
Se ln es
an d Sa
ll is
(2 0 0 3 )
72 Journal of International Marketing
Ta bl e 2.
Co nt in ue d
K ey
M ar k et in g C ap
ab il it ie s
(M C s)
Id en ti fi ed
P er fo rm
an ce
M ea su re
St u d y D es ig n an
d Sa
m p le
Se le ct ed
F in d in gs
A u th o rs
M ar k et in g p la n n in g an
d m ar k et in g im
p le m en ta ti o n
ca p ab
il it ie s
Su b je ct iv e:
T im
e to
m ar k et , re -
sp o n se
to co m p et it o rs ’ p ro d u ct
ch an
ge , n u m b er
o f su cc es sf u l
n ew
p ro d u ct s, n ew
p ro d u ct
re ve n u e
C ro ss -s ec ti o n al : 2 8 7
B ri ti sh
an d 1 7 3 C h in es e
ex p o rt
ve n tu re s
In d iv id u a l a n d o rg a n iz a ti o n a l ex
p er ie n ti a l
k n o w le d g e a n d o rg a n iz a ti o n a l in fo rm
a ti o n
k n o w le d g e d ri v e m a rk et in g p la n n in g
a n d im
p le m en
ta ti o n ca p a b il it ie s,
w h ic h in
tu rn
co n tr ib u te
to ex
p o rt
v en
tu re
p er fo r-
m a n ce . M
a rk et in g p la n n in g ca p a b il it ie s
im p ro v e m a rk et in g im
p le m en
ta ti o n
ca p a b il it ie s.
M o rg an
et al . (2 0 0 3 )
E x p o rt
M C s: p ri ci n g,
d is tr ib u -
ti o n , co m m u n ic at io n , an
d p ro d u ct
d ev el o p m en t
ca p ab
il it ie s
Su b je ct iv e:
P o si ti o n al
ad va
n ta ge
(m ed ia to r)
an d fi n an
ci al
p er fo rm
an ce
C ro ss -s ec ti o n al : 1 7 6 ex -
p o rt
ve n tu re s o f 5 0
C h in es e ex p o rt er s fr o m
2 0 in d u st ri es
T h re e o f th e fo u r ex
p o rt
M C s (p ro d u ct
d e-
v el o p m en
t, d is tr ib u ti o n , a n d co
m m u n ic a -
ti o n ) im
p a ct
fi rm
s’ lo w -c o st
a n d b ra n d in g
p o si ti o n a l a d v a n ta g es
p o si ti v el y , w h ic h in
tu rn
im p ac t fi rm
s’ fi n a n ci al
p er fo rm
an ce .
Z o u , F an
g, an
d Z h ao
(2 0 0 3 )
Se rv ic e q u al it y co m p et en ce
an d
cu st o m er
co m p et en ce
Su b je ct iv e: In im
it ab
il it y o f a fi rm
’s co m p et it iv e ad
va n ta ge ; O b je c-
ti ve :E
n tr y m o d e (f ra n ch is in g an
d m an
ag em
en t co n tr ac ts )
C ro ss -s ec ti o n al : 1 3 9 h o -
te ls fr o m
4 6 co u n tr ie s
(5 5 %
fr o m
d ev el o p in g
co u n tr ie s)
Se rv ic e q u al it y co m p et en ce
co n tr ib u te s m o st to
th e in im
it ab
il it y o f a fi rm
’s co m p et it iv e ad
- va
n ta ge ; fi rm
s w it h h ig h er
se rv ic e q u al it y
co m p et en ce
ar e m o re
li k el y to
ch o o se
m an
- ag
em en t co n tr ac ts
o ve r fr an
ch is in g.
T h is
ef fe ct
is st ro n ge r fo r la rg er
fi rm
s an
d in
se rv ic e- se n si ti ve
m ar k et s. Se rv ic e q u al it y
co m p et en ce
an d cu st o m er
co m p et en ce
ar e
se en
to b e m o re
d if fi cu lt to
tr an
sf er
vi a fr an
- ch is in g th an
o th er
co m p et en ce s.
E rr am
il li , A ga
rw al ,
an d D ev
(2 0 0 2 )
In fo rm
at io n al , cu st o m er
re la ti o n sh ip – b u il d in g,
p ro d -
u ct d ev el o p m en t, an
d su p p li er
re la ti o n sh ip – b u il d in g
ca p ab
il it ie s
Su b je ct iv e:
E x p o rt
co m p et it iv e
ad va
n ta ge
(c o st , p ro d u ct
an d
se rv ic e)
C ro ss -s ec ti o n al : 2 0 2
U .K . ex p o rt in g
m an
u fa ct u re s
In fo rm
a ti o n ca p a b il it ie s d ri v e se rv ic e a d -
v a n ta g e,
p ro d u ct
d ev el o p m en
t ca p a b il it ie s
d ri v e p ro d u ct
a d v a n ta g e,
a n d su p p li er
re -
la ti o n sh ip
ca p a b il it ie s d ri v e co
st a d v a n ta g e.
C u st o m er
re la ti o n sh ip -b u il d in g ca p a b il it y
d ri v es
a ll th re e ty p es
o f co
m p et it iv e
a d v a n ta g e.
K al ek a (2 0 0 2 )
Marketing Capabilities in International Marketing 73
Ta bl e 2.
Co nt in ue d
K ey
M ar k et in g C ap
ab il it ie s
(M C s)
Id en ti fi ed
P er fo rm
an ce
M ea su re
St u d y D es ig n an
d Sa
m p le
Se le ct ed
F in d in gs
A u th o rs
T ra n sn at io n al
p ro d u ct
in n o va
- ti o n ca p ab
il it y
N .A .
C ro ss -s ec ti o n al : 9 0
tr an
sn at io n al
p ro d u ct
in tr o d u ct io n s fr o m
4 5
M N C s
O rg an
iz at io n s th at
u se
cr o ss -n at io n al
te am
s, te am
s w it h m em
b er s w h o h av e p ri o r o ve rs ea s
ex p er ie n ce , an
d te am
s w h o se
m em
b er s co m -
m u n ic at e fr eq u en tl y w it h o ve rs ea s m an
ag er s in
o rd er
to ac q u ir e in fo rm
at io n ab
o u t ta ci t d if fe r-
en ce s am
o n g co u n tr ie s h av e gr ea te r tr an
sn a-
ti o n al
p ro d u ct
d ev el o p m en t ca p ab
ili ti es .
Su b ra m an
ia m
an d
V en k at ra m an
(2 0 0 1 )
P ri ce
co m p et it iv en es s, p ro d u ct
q u al it y,
p ro d u ct
va ri et y,
m ar k et
su p p o rt , cu st o m er
se rv ic e,
an d p ro d u ct
te ch n o l-
o gy
ca p ab
il it ie s
Su b je ct iv e:
E x p o rt
p er fo rm
an ce
(f in an
ci al
o u tc o m e,
st ra te gi c
o u tc o m e,
an d sa ti sf ac ti o n w it h
o u tc o m es
o f ex p o rt in g)
C ro ss -s ec ti o n al : 3 8 1 U .S .
m an
u fa ct u re rs in vo
lv ed
in ex p o rt in g
M C s h av
e a p o si ti ve
im p ac t o n ex p o rt
p er fo r-
m an
ce . F ir m s’ in te gr at io n o f In te rn et
te ch -
n o lo gy
in to
m ar k et in g ac ti vi ti es
st re n gt h en s
th e in fl u en ce
o f co m p et it o r/ in te rf u n ct io n al
o ri en ta ti o n o n th e fi rm
s’ m ar k et in g co m p e-
te n ci es . F ir m
si ze
an d fi rm
d eg re e o f ex p o rt
d ep en d en ce
fu rt h er
st re n gt h en
th e p o si ti ve
im p ac t o f M
C s o n ex p o rt
p er fo rm
an ce .
P ra sa d ,R
am am
u rt h y,
an d N ai d u (2 0 0 1 )
M ar k et
o ri en ta ti o n , st ra te gi c
d ec is io n ti m e h o ri zo n , an
d m ar k et
p o si ti o n in g
ca p ab
il it ie s
Su b je ct iv e:
F in an
ci al
(p ro fi t an
d R O I) an
d m ar k et
(s al es
an d
m ar k et
sh ar e)
p er fo rm
an ce
re la -
ti ve
to co m p et it o rs
C ro ss -s ec ti o n al : 1 ,6 1 9
fi rm
s in
H u n ga
ry ,
P o la n d , an
d Sl o ve n ia
W h o ll y o w n ed
fo re ig n fi rm
su b si d ia ri es
an d
IJ V s h av
e h ig h er
le ve ls o f M
C th an
st at e-
o w n ed
fi rm
s in
th e th re e ce n tr al
E u ro p ea n
co u n tr ie s. F ir m s w it h h ig h er M
C s en jo y h ig h er
fi n an
ci al
an d m ar k et
p er fo rm
an ce .
F ah
y et
al . (2 0 0 0 )
a M et a- an
al ys es
th at
w e in cl u d e al o n g w it h th e o th er
4 1 su rv ey -b as ed
st u d ie s b ec au
se th ey
m ai n ly
re vi ew
su rv ey -b as ed
re se ar ch
in m ar k et in g ca p ab
il it ie s in
in te rn at io n al
m ar k et in g.
N o te s: N .A . = n o t ap
p li ca b le .
74 Journal of International Marketing
Ta bl e 3.
Re pr es en ta tiv e O ut co m e- In fe re nc ed /S ec on da ry D at a– B as ed
M ar ke tin g Ca pa bi lit ie s Re se ar ch
in In te rn at io na l M ar ke tin g
M ar ke ti ng
C ap ab ili ti es
an d H ow
M ea su re d
P er fo rm
an ce
M ea su re
St u d y D es ig n an
d Sa
m p le
Se le ct ed
F in d in gs
A u th o rs
D yn
am ic
m ar k et in g ca p ab
il it y (D
M C ) is
m ea su re d as
m ar k et in g in te n si ty
(m ar -
k et in g ex p en d it u re /t o ta l sa le s) .
Su b je ct iv e:
F o re ig n
af fi li at e
p er fo rm
an ce
P an
el : 2 5 4 fo re ig n -o w n ed
af fi li at es
(F O A s)
in In d ia
d u ri n g 2 0 0 0 – 2 0 0 8
E ff ec ti ve
d ep lo ym
en t o f D M C
le ad
s to
b et te r sa le s
p er fo rm
an ce
in w h o lly
o w n ed
F O A s th an
in IJ V s,
an d in n o n m et ro p o lit an
th an
in m et ro p o lit an
ar ea s.
K o n w ar
et al .
(2 0 1 7 )
M C s ar e m ea su re d b y th e n u m b er
o f
m o n th s ah
ea d th e fi rm
(1 ) p la n n ed
it s
p ro d u ct
m ix
an d ta rg et
m ar k et s; (2 ) al -
lo ca te d th e n ec es sa ry
h u m an
re so u rc es ;
an d (3 ) m ad
e th e n ec es sa ry
in ve st m en t.
Su b je ct iv e:
F ir m
p er fo rm
an ce
(m ar k et
sh ar e)
C ro ss -s ec ti o n al : 1 9 ,6 5 3
fi rm
s fr o m
7 3 em
er gi n g
ec o n o m ie s o n fo u r
co n ti n en ts
T h e M
C – fi rm
p er fo rm
an ce
re la ti o n sh ip
is m o d -
er at ed
b y th e le ve lo
f in st it u ti o n al d ev el o p m en t in
an em
er gi n g m ar k et . Su
p er io r M
C s h av
e a st ro n ge r p er fo rm
an ce
im p ac t in
co u n tr ie s w it h
h ig h er
le ve ls o f ec o n o m ic
d ev el o p m en t an
d in
in d iv id u al is ti c so ci et ie s, an
d w ea k er
im p ac t in
co u n tr ie s w it h st ro n g le gi sl at iv e sy st em
s.
W u (2 0 1 3 )
P ar en ts ’ ad
ve rt is in g in te n si ty
O b je ct iv e:
C it y cl as s
o f su b si d ia ry
lo ca ti o n
C ro ss -s ec ti o n al : 6 ,9 5 5
su b si d ia ri es
n es te d w it h in
3 1 8 m u lt in at io n al
en te rp ri se s
P ar en t fi rm
’s M
C s m o d er at e th e p o si ti ve
re la -
ti o n sh ip
b et w ee n a m u lt in at io n al
en te rp ri se
su b si d ia ry ’s m o ti ve
fo r ta rg et in g lo ca l m ar k et s
an d it s p ro p en si ty
to b e lo ca te d in
a gl o b al
ci ty .
G o er ze n , A sm
u s-
se n , an
d N ie ls en
(2 0 1 3 )
M ar k et in g co m m u n ic at io n , se lli n g,
an d
m ar k et
in fo rm
at io n m an
ag em
en t ca p ab
il- it ie s ar e m ea su re d u si n g SF
E . E ac h o f th e
M C s is es ti m at ed
b y h o w
ef fi ci en tl y th e
fi rm
co n ve rt s m ar k et in g re so u rc e in to
sa le s.
O b je ct iv e:
D ea le rs h ip
n et w o rk
p er fo r-
m an
ce (f ir m
ef fi ci en cy )
P an
el : 4 5 d ea le rs
(f ro m
C an
ad a,
M ex ic o , an
d U n it ed
St at es ) o f a fu rn i-
tu re
fi rm
(n = 1 5 5 ) in
4 ye ar s
D ea le rs
h av
e d ec re as in g M
C s o ve r ti m e,
b u t th ei r
re la ti ve
M C
ra n k in g is ge n er al ly
st ea d y.
A k d en iz , G o n za le z-
P ad
ro n , an
d C al an
to n e (2 0 1 0 )
C o st -l ea d er sh ip
co m p et en ce s ar e m ea su re d
b y p ro d u ct io n co st s/ sa le s an
d SG
A /s al es
re la ti ve
to in d u st ry
m ed ia n . D if fe re n ti a-
ti o n co m p et en ce s ar e m ea su re d b y R & D
ex p en se /s al es
an d n ew
p ro d u ct
o u tp u ts /
to ta l o u tp u ts .
O b je ct iv e:
E x p o rt
p ro p en si ty
an d ex -
p o rt
in te n si ty , an
d ex p o rt
p er fo rm
an ce
(r et u rn
o n sa le s)
P an
el : 1 8 ,6 4 4 ex p o rt er s
(d o m es ti c p ri va
te en te r-
p ri se s an
d fo re ig n w h o ll y
o w n ed
su b si d ia ri es ) in
C h in a fr o m
2 0 0 1 to
2 0 0 5
F ir m s w it h re al iz ed
co m p et en ci es
o f co st le ad
er sh ip
an d d if fe re n ti at io n m o re
lik el y to
ex p o rt an
d h av e
h ig h le ve ls o f ex p o rt in te n si ty .W
h ile
th is h o ld s tr u e
fo r d o m es ti c fi rm
s, fo re ig n fi rm
s w it h d if fe re n ti a-
ti o n co m p et en ci es
h av e lo w
le ve ls o f ex p o rt in te n -
si ty , an
d o n ly
th o se
w it h co st le ad
er sh ip
co m p et en ci es
h av e h ig h er
le ve ls o f ex p o rt p ro p en -
si ty
an d ex p o rt in te n si ty .
G ao
et al . (2 0 1 0 )
U si n g SF
E , M C s ar e es ti m at ed
b y h o w
ef fi -
ci en tl y th e fi rm
co n ve rt s it s m ar k et in g ex -
p en d it u re
(S G A ), in ta n gi b le re so u rc es
(T o b in ’s q ), re la ti o n sh ip
ex p en d it u re
(c o st
o f re ce iv ab
le s) ,a n d in st al le d cu st o m er
b as e
(s al es
gr o w th ) in to
sa le s.
O b je ct iv e:
P ro fi ta b il it y
C ro ss -s ec ti o n al : 1 0 2 lo gi st ic s
fi rm
s in
U n it ed
K in gd
o m
(7 6 %
w en t fo r in te rn a-
ti o n al
d iv er si fi ca ti o n )
M C s p o si ti ve ly
in fl u en ce
fi rm
p er fo rm
an ce . F ir m
ef fi ci en cy
en h an
ce s th e p o si ti ve
im p ac t o f m ar -
k et in g ca p ab
il it ie s o n a fi rm
’s p ro fi ta b il it y.
N at h , N ac h ia p p an
, an
d R am
an at h an
(2 0 1 0 )
Marketing Capabilities in International Marketing 75
Ta bl e 3.
Co nt in ue d
M ar ke ti ng
C ap ab ili ti es
an d H ow
M ea su re d
P er fo rm
an ce
M ea su re
St u d y D es ig n an
d Sa
m p le
Se le ct ed
F in d in gs
A u th o rs
P ar en ts ’ ad
ve rt is in g in te n si ty
O b je ct iv e:
E n tr y
m o d e:
fu ll ac q u is i-
ti o n s vs . gr ee n fi el d
jo in t ve n tu re s
C ro ss -s ec ti o n al : 1 0 1 jo in t
ve n tu re s an
d 1 6 8 w h o ll y
o w n ed
su b si d ia ri es
o w n ed
b y Ja p an
es e su b si d ia ri es
in th e U n it ed
St at es
Ja p an
es e p ar en ts sp en d in g m o re
o n ad
ve rt is in g ar e
m o re
li k el y to
p ro cu re
m ar k et in g as se ts fr o m
U .S .
fi rm
s th ro u gh
ac q u is it io n s. Ja p an
es e fi rm
s o p er -
at in g an
ad ve rt is in g- in te n si ve
h o m e b u si n es s al so
m o re
li k el y to
en te r ad
ve rt is in g- in te n si ve
U .S .
in d u st ri es .
C h en
(2 0 0 8 )
C li en t- sp ec if ic ca p ab
il it y (p ri o r ex p er ie n ce
w it h cl ie n t) is m ea su re d b y re p ea t cl ie n ts .
O b je ct iv e:
P ro je ct
co n tr ib u ti o n (r ev e-
n u es
m in u s co st s)
P an
el : 5 7 cl ie n ts
o f a gl o b al
so ft w ar e se rv ic e fi rm
in In d ia
d u ri n g 1 9 9 6 – 2 0 0 1
C li en t- sp ec if ic
ca p ab
il it y is m o d es tl y re la te d w it h
p ro je ct
p er fo rm
an ce .
E th ir aj
et al .
(2 0 0 5 )
M C s ar e m ea su re d b y ad
ve rt is in g ex p en -
d it u re /s al es .
O b je ct iv e:
R et u rn
o n
as se ts
an d m ar k et -
to -b o o k va
lu e
P an
el : 1 4 m aj o r gl o b al
p h ar m ac eu ti ca l fi rm
s in
1 9 8 5 – 1 9 9 1
M C
d o es
n o t h av
e a si gn
if ic an
t im
p ac t o n fi rm
p er fo rm
an ce .
D e C ar o li s (2 0 0 3 )
M C s ar e re fl ec te d in
in d u st ry
b ra n d (a d -
ve rt is in g ex p en se s/ sa le s)
an d sa le s fo rc e
(s el li n g ex p en se s/ sa le s an
d sa le s fo rc e/
to ta l em
p lo ye e)
le ve l.
O b je ct iv e:
E n tr y
m o d e ch o ic e
C ro ss -s ec ti o n al : 2 ,1 7 5 en -
tr ie s b y B ri ti sh , Ja p an
es e,
an d G er m an
in ve st o rs
in to
U n it ed
St at es
St ro n g m ar k et in g ca p ab
il it ie s in
th e en te re d in -
d u st ry
in th e U n it ed
St at es
en h an
ce th e p ro p o r-
ti o n o f en tr ie s b y ac q u is it io n .
A n an
d an
d D el io s
(2 0 0 2 )
A d ve rt is in g ex p en d it u re .
O b je ct iv e:
E n tr y
m o d e (j o in t ve n tu re
vs . w h o ll y o w n ed
su b si d ia ry )
C ro ss -s ec ti o n al : 2 6 9
Ja p an
es e af fi li at es
in U n it ed
St at es
(1 0 1 ar e
jo in t ve n tu re s)
Ja p an
es e p ar en t fi rm
s th at
sp en t m o re
o n ad
ve rt is in g
in th e U n it ed
St at es p ri o r to
U .S .e n tr y ar e le ss lik
el y
to ch o o se
jo in t ve n tu re s o ve r w h o lly
o w n ed
su b si d ia ri es .J ap
an es e p ar en t fi rm
s th at
sp en t m o re
o n ad
ve rt is in g in
Ja p an
p ri o r to
U .S .e n tr y ar e m o re
lik el y to
ch o o se
jo in t ve n tu re s o ve r w h o lly
o w n ed
su b si d ia ri es .
C h en
an d H en n ar t
(2 0 0 2 )
M C s ar e m ea su re d b y m ar k et in g in te n si ty
(a d ex p en se /s al es ).
O b je ct iv e:
F in an
ci al
an d o p er at io n al
p er fo rm
an ce
(r et u rn
o n as se ts
an d sa le s/
o p er at in g co st s)
P an
el :4
9 U .S .M
N C fi rm
s in
1 2 d if fe re n t in d u st ri es
(o ve r a se ve n -y ea r p er io d
en d in g in
1 9 9 3 )
F ir m s w it h h ig h er
M C
an d R & D
ca p ab
il it ie s ar e
b et te r ab
le to
re al iz e th e in h er en t b en ef it s o f
m u lt in at io n al it y re ga
rd in g fi n an
ci al
an d o p er a-
ti o n al
p er fo rm
an ce .
K o ta b e,
Sr in iv a-
sa n , an
d A u la k h
(2 0 0 2 )
76 Journal of International Marketing
been used in a few international marketing studies in our sample is the institution-based view. This perspective is based on institutional theory, which focuses on institutional pressures, such as industry or societal norms, regulations, and requirements, to which firms must adapt to attain legitimacy, operate, and serve customers in a country marketplace (e.g., Peng2003).Suchinstitutionalforcesmayvaryacrossdifferent country marketplaces and can affect informal and formal marketing exchanges and thereby impact both the design and processes of an organization (e.g., Hult 2011).
Comparing specific marketing capabilities identified in the internationalmarketingversusgeneralmarketingliterature,we find only seven marketing capabilities that are specific/unique to studies in international marketplaces and that could therefore potentially be considered “international marketing capabilities” (vs. simply general marketing capabilities in an international context): (1) MNCs’ transnational product innovation capability (Sheng et al. 2015; Subramaniam and Venkatraman 2001), (2) global brand manage- ment capability (Matanda and Ewing 2012), (3) over- seas market–related exploitative and explorative capabilities (Lisboa,Skarmeas,andLages2011),(4)internationalcustomer- support capability (Khavul et al. 2010), (5) adaptive capa- bility (Lu et al. 2010), (6) local market competence (Wu et al. 2007), and (7) global account management capability (Shi et al. 2005). Details of the research on these capa- bilities are summarized in Table 4. In the following section, we review the literature on marketing capabilities in in- ternational marketing in more detail from three perspectives: (1) the classification of marketing capabilities; (2) the mea- surement and analysis of marketing capabilities; and (3) the antecedents, mediators, moderators, and consequences of marketing capabilities in international marketing.
Classification. As the notion of marketing capabilities is still relatively new to the marketing discipline (Morgan 2012), research in this area is still rather fragmented. However, the literature reveals several ways to classify different marketing capabilities. For example, adopting a market orientation perspective, Day (1994) classifies capabilities as outside-in, inside-out, and spanning capabilities and identifies market sensing and customer linking as the most important outside- in marketing capabilities. Day (2011) extends his earlier classification by proposing three subsets of marketing ca- pabilities: (1) static marketing capabilities, which include specialized/functional capabilities and cross-functional capabilities; (2) dynamic marketing capabilities, such as the ability to reconfigure and improve existing marketing capabilities; and (3) adaptive marketing capabilities, which deal with proactive vigilant marketing learning through ex- perimentation and active interactions with network partners.
In a different approach drawing on qualitative fieldwork based on interviews and focus groups with managers, Vorhies and Morgan (2003, 2005) classify marketing ca- pabilities into two categories: specialized capabilities and architectural capabilities. Specialized capabilities refer to the lower-order, functionally focused, marketing mix–related processes and routines such as pricing, advertising, product management, and channel management. Architectural ca- pabilities such as marketing strategy planning and imple- mentation capabilities deal with higher-order processes and routines that orchestrate and coordinate the firm’s spe- cialized marketing capabilities and their associated resource inputs. Morgan and Slotegraaf (2012) and Morgan (2012) build on this to provide a more extensive taxonomy by (1) adding a third type of marketing capability: cross-functional capabilities, such as brand management and customer re- lationship management (CRM), that bring together multiple different functional inputs; and (2) classifying marketing capabilities not only by their lower- to higher- order nature but also by the different levels at which they exist—individual, group, organization, and in- terorganizational levels—providing the most compre- hensive framework available to date for classifying various marketing capabilities.
Consistent with Morgan and Slotegraaf’s (2012) classifi- cation system, we classify the marketing capabilities in the representative set of studies we identified in the international marketing literature by their lower- to higher-order nature and the organizational levels at which they exist. Table 5 is adapted from Morgan and Slotegraaf (2012, p. 94) and summarizes the characteristics, examples, and representa- tive studies of various types of marketing capabilities in the international market context.
Table 5 reveals that existing research on marketing capa- bilities in international markets has a heavy focus on midlevel marketing capabilities (35 of the 64 articles reviewed), compared with research in domestic markets, which has generally focused to a greater degree on lower-level marketing capabilities. While many articles examining marketing capability in international markets also study lower-level marketing capabilities (23 of the 64 articles), very few focus on higher-level marketing capa- bilities (6 of the 64 articles). This is consistent with- —and may even be due to—the equally scant research on higher-level marketing capabilities in domestic market contexts in the general marketing literature.
Lower-level marketing capabilities are characterized by the specialized functional marketing processes used to design and implement individual marketing-mix (four Ps) activities
Marketing Capabilities in International Marketing 77
Ta bl e 4.
Re pr es en ta tiv e Em
pi ric al Re se ar ch
on In te rn at io na l M ar ke tin g Ca pa bi lit ie s
M ar k et in g C ap
ab il it ie s
Sp ec if ic /U
n iq u e to
In te rn at io n al
M ar k et s
D ef in it io n
C ap
tu re s D yn
am ic s in
M ar k et in g C ap
ab il it ie s?
C ap
ab il it ie s A ss es se d
R el at iv e to
R iv al s?
C au
sa l R el at io n sh ip s
H yp
o th es iz ed /T
es te d ?
A u th o rs
M N C s’ p ro d u ct
in n o va
ti o n
ca p ab
il it y/ tr an
sn at io n al
pr od
uc ti nn
ov at io n ca pa bi lit y
T h e ca p ab
il it y to
d ev el o p an
d in tr o d u ce
n ew
p ro d u ct s th at
fu lf il l n ee d s ac ro ss
m u lt ip le
co u n tr y m ar k et s
·C o n ce p t: n o
Y es
H yp
o th es iz ed : n o
Sh en g et
al . (2 0 1 5 );
Su b ra m an
ia m
an d
V en k at ra m an
(2 0 0 1 )
·M ea su re s: n o
G lo b al
b ra n d m an
ag em
en t
ca p ab
il it y
A b il it y to
st an
d ar d iz e b ra n d s
ac ro ss
m ar k et s w it h o u t u p -
se tt in g (b u t, ra th er , in sp ir in g)
lo ca l m an
ag er s an
d /o r
co n su m er s
·C o n ce p t: ye s
N .A . (c as e st u d y)
N .A . (c as e st u d y)
M at an
d a an
d E w in g
(2 0 1 2 )
·M ea su re s: N .A .
O ve rs ea s m ar k et – re la te d
ex p lo it at iv e an
d ex p lo r-
at iv e ca p ab
il it ie s
O ve rs ea s m ar k et – re la te d ex -
p lo it at iv e (e x p lo ra ti ve ) ca p a-
b il it ie s re fl ec t th e fi rm
’s ab
il it y
to re fi n e an
d ex te n d (a cq u ir e)
it s ex is ti n g (e n ti re ly
n ew
) o ve rs ea s m ar k et an
d cu st o m er
k n o w le d ge , sk il ls , an
d p ro ce ss es
·C o n ce p t: ye s
N o
·H yp
o th es iz ed : ye s
L is b o a,
Sk ar m ea s,
an d L ag
es (2 0 1 1 )
·M ea su re s: n o
·T es te d u si n g cr o ss -
se ct io n al
d at a:
ye s
In te rn at io n al
cu st o m er -
su p p o rt
ca p ab
il it y
A ll ac tiv iti es
to en su re
th at
a pr od
uc ti s av ai la bl e fo r tr ou
bl e-
fr ee
us e ov er
its us ef ul
lif e sp an
·C o n ce p t: ye s
N o
·H yp
o th es iz ed : ye s
K h av u l et
al . (2 0 1 0 )
·M ea su re s: n o
·T es te d u si n g cr o ss -
se ct io n al
d at a:
ye s
A d ap
ti ve
ca p ab
il it y
T h e fi rm
’s ab
il it y to
co o rd in at e,
re co m b in e,
an d al lo ca te
re -
so u rc es
to m ee t th e d if fe re n t
re q u ir em
en ts
o f fo re ig n
m ar k et s
·C o n ce p t: ye s
N o
·H yp
o th es iz ed : ye s
L u et
al . (2 0 1 0 )
·M ea su re s: ye s
·T es te d u si n g cr o ss -
se ct io n al
d at a:
ye s
L o ca l m ar k et
co m p et en ce
T h e ab
il it y o fa
m an
u fa ct u re r to
re co gn
iz e an
d ex p lo it lo ca l
m ar k et
o p p o rt u n it ie s
·C o n ce p t: n o
N o
·H yp
o th es iz ed : ye s
W u et
al . (2 0 0 7 )
·M ea su re s: n o
·T es te d u si n g cr o ss -
se ct io n al
d at a:
ye s
G lo b al
ac co u n t m an
ag e-
m en t ca p ab
il it y
In te lli ge n ce
ac q u is it io n , co o rd i-
n at io n , an
d re co n fi gu
ra ti o n
·C o n ce p t: ye s
N .A . (c as e st u d y)
N .A . (c as e st u d y)
Sh i et
al . (2 0 0 5 )
·M ea su re s: N .A .
N o te s: N .A . = n o t ap
p li ca b le .
78 Journal of International Marketing
Ta bl e 5.
Cl as si fic at io n of
M ar ke tin g Ca pa bi lit y Le ve ls in In te rn at io na l M ar ke tin g
L ev el
o f
M ar k et in g
C ap
ab il it ie s
C h ar ac te ri st ic s
E x am
p le s
R ep re se n ta ti ve
St u d ie s
H ig h -l ev el
D yn
am ic
m ar k et in g ca p a-
b il it ie s, m ar k et
le ar n in g,
re so u rc e re co n fi gu
ra -
ti o n , an
d ca p ab
il it y en -
h an
ce m en t (D
ay 2 0 1 1 ;
M o rg an
2 0 1 2 ; M
o rg an
an d Sl o te gr aa
f 2 0 1 2 )
In d iv id u al
A d ap
ti ve
se ll in g,
p ro ce ss
th in k in g,
m ar -
k et in g sk il ls d ev el o p m en t
N .A .
G ro u p (t ea m /f u n ct io n )
C h an
n el
tr an
sf o rm
at io n
W il so n an
d D an
ie l (2 0 0 7 )
O rg an
iz at io n (f ir m )
M ar k et
le ar n in g,
m ar k et in g re so u rc e
re co n fi gu
ra ti o n , an
d ca p ab
il it y
au gm
en ta ti o n
E ve rs , A n d er ss o n , an
d H an
n ib al
(2 0 1 2 ); F an
g an
d Z o u
(2 0 0 9 ); L ag
es , Si lv a,
an d St yl es
(2 0 0 9 ); Sh
i et
al . (2 0 0 5 )
A d ap
ti ve
m ar k et in g m ix
to fo re ig n m ar k et s
L u et
al . (2 0 1 0 )
E x p lo it at iv e an
d ex p lo ra ti ve
(p ro d u ct
d e-
ve lo p m en t an
d o ve rs ea s m ar k et – re la te d )
L is b o a,
Sk ar m ea s, an
d L ag
es (2 0 1 1 )
In te ro rg an
iz at io n al
In te ro rg an
iz at io n al
le ar n in g/ b en ch m ar k in g
Se ln es
an d Sa
ll is (2 0 0 3 )
M id le ve l
A rc h it ec tu ra l/ o rc h es tr at -
in g o r st ra te gi c m ar k et -
in g ca p ab
il it ie s (M
o rg an
2 0 1 2 ; M
o rg an
, K at si -
k ea s, an
d V o rh ie s 2 0 1 2 ;
M o rg an
et al . 2 0 0 3 )
In d iv id u al
C u st o m er
co m p la in t re so lu ti o n
N .A .
G ro u p (t ea m /f u n ct io n )
T ea m
se ll in g
A k d en iz , G o n za le z- P ad
ro n , an
d C al an
to n e (2 0 1 0 )
O rg an
iz at io n (f ir m )
M ar k et
en vi ro n m en t sc an
n in g o r m ar k et
se n si n g (i n fo rm
at io n )
K al ek a (2 01
1) ; K au fm
an n an d R oe sc h (2 01
2) ; L u et al . (2 0 10
); M al ik , Si nh
a, an d B lu m en fe ld
(2 01
2 ); M u (2 01
5 ); W u et
al .
(2 00
7)
St ra te gi c m ar k et in g p la n n in g (s eg m en ta -
ti o n , ta rg et in g,
an d p o si ti o n in g)
F ah
y et
al . (2 0 0 0 ); G ao
et al . (2 0 1 0 ); K n ig h t, M
ad se n , an
d Se rv ai s (2 0 0 4 ); M
o rg an
, K at si k ea s, an
d V o rh ie s (2 0 1 2 );
So n g et
al . (2 0 0 8 ); Sp
yr o p o u lo u et
al . (2 0 1 7 )
M ar k et in g st ra te gy
im p le m en ta ti o n , co n -
tr o l, an
d ev al u at io n s
D eS ar b o et
al . (2 0 0 5 ); L ag
es , Si lv a,
an d St yl es
(2 0 0 9 );
M o rg an
et al . (2 0 0 3 ); So
n g et
al . (2 0 0 8 ); W
u (2 0 1 3 )
C ro ss -f u n ct io n al
m ar k et -
in g ca p ab
il it ie s (D
ay 1 9 9 4 , 2 0 1 1 ; M
o rg an
2 0 1 2 )
O rg an
iz at io n (f ir m )
B ra n d m an
ag em
en t
B o rt o lu zz ie t al .( 2 0 1 4 ); E rr am
il li ,A
ga rw
al ,a n d D ev
(2 0 0 2 );
M at an
d a an
d E w in g (2 0 1 2 )
C u st o m er
re la ti o n sh ip
m an
ag em
en t (C
R M
) K al ek a an
d M o rg an
(2 0 1 7 ); L eo n id o u , P al ih aw
ad an
a, an
d T h eo d o si o u (2 0 1 1 ); M u (2 0 1 5 ); R ei n ar tz , K ra ff t, an d H o ye r
(2 0 0 4 ); Sh
i et
al . (2 0 0 5 ); Z h o u , W u , an d B ar n es
(2 0 1 2 )
N ew
p ro d u ct
d ev el o p m en t (N
P D )
E is en d , E va n sc h it zk y,
an d C al an
to n e (2 0 1 6 ); F re em
an an
d St yl es
(2 0 1 4 ); Sh
en g et
al . (2 0 1 5 ); Su
b ra m an
ia m
an d V en -
k at ra m an
(2 0 0 1 ); V ic en te , A b ra n te s, an
d T ei x ei ra
(2 0 1 5 )
In te ro rg an
iz at io n al
C h an
n el
b o n d in g,
ch an
n el
re la ti o n sh ip
m an
ag em
en t, ch an
n el
n et w o rk in g
B le sa
an d R ip o ll es
(2 0 0 8 ); B o rt o lu zz ie ta
l. (2 0 1 4 ); B o so
et al .
(2 0 1 3 ); K al ek a (2 0 0 2 ); M
u (2 0 1 5 ); So
n g et
al . (2 0 0 5 );
Z h o u , W
u , an
d B ar n es
(2 0 1 2 )
D is p er se d N P D
P er k s (2 0 0 5 )
Marketing Capabilities in International Marketing 79
Ta bl e 5.
Co nt in ue d
L ev el
o f
M ar k et in g
C ap
ab il it ie s
C h ar ac te ri st ic s
E x am
p le s
R ep re se n ta ti ve
St u d ie s
L o w er -l ev el
Sp ec ia li ze d /f u n ct io n al
o r
ta ct ic al
m ar k et in g sk il ls
in im
p le m en ti n g m ar k et -
in g- m ix
ac ti vi ti es
(V o rh ie s an
d M
o rg an
2 0 0 5 )
In d iv id u al
O ve rs ea s p er so n al
se ll in g an
d ca ll h an
d li n g
N .A .
G ro u p (t ea m /f u n ct io n )
O ve rs ea s st o re
m an
ag em
en t an
d m er ch an
- d is e m an
ag em
en t
N .A .
O rg an
iz at io n (f ir m )
P ri ci n g
K em
p er , E n ge le n , an
d B re tt el
(2 0 1 1 ); O ’C as s an
d N go
(2 0 1 1 ); P h am
, M
o n k h o u se , an
d B ar n es
(2 0 1 7 ); P ra sa d ,
R am
am u rt h y,
an d N ai d u (2 0 0 1 ); T an
an d So
u sa
(2 0 1 5 );
Z o u , F an
g, an
d Z h ao
(2 0 0 3 )
Se ll in g
A k d en iz , G o n za le z- P ad
ro n , an
d C al an
to n e (2 0 1 0 ); L ee
an d
Z h o u (2 0 1 2 ); M
ar ia d o ss , T an
su h aj , an
d M
o u ri (2 0 1 1 );
M o rg an
, K at si k ea s, an
d V o rh ie s (2 0 1 2 )
A d ve rt is in g an
d p ro m o ti o n
A n an
d an
d D el io s (2 0 0 2 ); C h en
(2 0 0 8 ); C h en
an d H en n ar t
(2 0 0 2 ); D e C ar o li s (2 0 0 3 ); G o er ze n , A sm
u ss en , an
d N ie ls en
(2 0 1 3 ); K o ta b e,
Sr in iv as an
, an
d A u la k h (2 0 0 2 );
L ee
an d Z h o u (2 0 1 2 )
M ar k et
re se ar ch
N .A .
M ar k et in g co m m u n ic at io n
K em
p er , E n ge le n , an
d B re tt el
(2 0 1 1 ); O ’C as s an
d N go
(2 0 1 1 ); P h am
, M
o n k h o u se , an
d B ar n es
(2 0 1 7 ); T an
an d
So u sa
(2 0 1 5 ); Z o u , F an
g, an
d Z h ao
(2 0 0 3 )
P ro d u ct
m an
ag em
en t
C h en ,C
h en ,a
n d Z h o u (2 0 1 4 ); E rr am
il li , A ga
rw al , an
d D ev
(2 0 0 2 ); M
o rg an
, K at si k ea s, an
d V o rh ie s (2 0 1 2 ); M
u rr ay
, G ao
, an
d K o ta b e (2 0 1 1 )
M ar k et
in fo rm
at io n /k n o w le d ge
m an
ag em
en t
A k d en iz , G o n za le z- P ad
ro n , an
d C al an
to n e (2 0 1 0 ); O zk ay
a et
al . (2 0 1 5 ); O ’ C as s an
d N go
(2 0 1 1 ) P h am
, M
o n k h o u se ,
an d B ar n es
(2 0 1 7 )
C u st o m er
se rv ic e
E th ir aj
et al . (2 0 0 5 ); K h av
u l et
al . (2 0 1 0 ); P ra sa d , R am
a- m u rt h y.
an d N ai d u (2 0 0 1 )
E -c o m m er ce
m ar k et in g ca p ab
il it y
G re go
ry , N go
, an
d K ar av
d ic
(2 0 1 7 )
In te ro rg an
iz at io n al
D is tr ib u ti o n /c h an
n el
m an
ag em
en t/ d el iv er y
K em
p er ,E
n ge le n ,a n d B re tt el (2 0 1 1 ); M ar ia d o ss ,T
an su h aj ,a n d
M o u ri (2 0 1 1 ); So n g et al .( 2 0 0 5 ); Z o u ,F an g, an d Z h ao
(2 0 0 3 )
N o te s: T h is ta b le
is ad
ap te d fr o m
M o rg an
an d Sl o te gr aa f (2 0 1 2 , p . 9 4 ). N .A . = n o t ap
p li ca b le .
80 Journal of International Marketing
(e.g., Morgan, Katsikeas, and Vorhies 2012; Vorhies and Morgan 2005) such as pricing (e.g., Zou, Fang, and Zhao 2003), advertising and promotion (Chen 2008; De Carolis 2003), and selling (e.g., Lee and Zhou 2012). In the in- ternational market context, most research on lower-level marketing capabilities focuses on firm-level capabilities, particularly in the areas of advertising, marketing communi- cations, and product management capabilities in foreign markets. In contrast, we observe no research on functional market research capabilities or on individual- and group-level marketing capabilities, such as overseas salesperson skills and overseas store management skills, perhaps because of the different nature of international selling (i.e., foreign sales) or difficulty getting data on overseas retail stores.
Midlevel marketing capabilities are characterized by ar- chitectural or strategic marketing capabilities (Morgan, Katsikeas, and Vorhies 2012; Morgan et al. 2003) such as market sensing (e.g., Kaufmann and Roesch 2012; Malik, Sinha, and Blumenfeld 2012; Song et al. 2005), marketing strategy planning (e.g., Morgan, Katsikeas, and Vorhies 2012), and strategy implementation capabilities (e.g., Spyropoulou et al. 2017); cross-functional capabilities such as brand management (e.g., Erramilli, Agarwal, and Dev 2002), CRM (e.g., Reinartz, Krafft, and Hoyer 2004; Leonidou, Palihawadana, and Theodosiou 2011), and new product development (Kaleka 2011); and interorganizational capabilities such as channel bonding and networking (Blesa and Ripolles 2008; Boso et al. 2013; Zhou, Wu, and Barnes 2012). We find that in the international context, environ- mental scanning or market sensing capabilities are the most frequently studied midlevel capabilities. This makes sense given the increased complexity of the environment when dealing with international markets. Meanwhile, brand managementcapabilityistheleastfrequentlystudiedmidlevel marketing capability, which mirrors the equally scant re- search in a domestic market context (Morgan, Slotegraaf, and Vorhies 2009) and may be due—at least in part—to the relative lack of established scales for this capability. In comparison with domestic marketing capability research, studies in international marketing have paid relatively more attention to interorganizational capabilities such as channel bonding and channel relationship management and networking capabilities, perhaps due to the importance of relying on local partners to understand and facilitate mar- keting operations in overseas markets in exporting—the most widely used mode of international market entry.
However, in general, marketing capability research in international markets is clearly dominated by firm-level marketing capabilities, with very few studies examining individual-level and group-level marketing capabilities. In
addition, very few studies have focused on exploring higher- level, dynamic marketing capabilities associated with reconfiguring resources and enhancing current marketing capabilities. Examples of such higher-level marketing capa- bilities are market learning capabilities (e.g., Morgan 2012), adaptive capabilities (Lu et al. 2010), and interorganizational learning capabilities (e.g., Selnes and Sallis 2003). Marketing capability research in domestic markets has also studied some individual-level higher-order capabilities like adaptive selling (e.g., Spiro and Weitz 1990) and process thinking (e.g., Dickson et al. 2009). Research in our sample of studies in the international marketing context has not examined such marketing capabilities.
In general, such higher-order marketing capabilities are difficult to observe and measure; thus, most studies of dynamic marketing capabilities adopt in-depth case study research designs (Evers, Andersson, and Hannibal 2012; Shi et al. 2005; Wilson and Daniel 2007). With few ex- ceptions (e.g., Fang and Zou 2009), studies using primary survey data designs often conceptualize marketing capa- bilities as “dynamic” (or at least draw on dynamic capa- bilities theory) but measure them in a static way that does not reflect the “dynamism” proposed in the conceptu- alization (see detailed examples in Table 4) (e.g., Lages, Silva, and Styles 2009; Lisboa, Skarmeas, and Lages 2011; Selnes and Sallis 2003). Nevertheless, theoreti- cally dynamic marketing capabilities are widely considered to be the ultimate source of competitive advantage in complex and rapidly changing global markets as they allow firms to continuously update their lower-order marketing capabilities and thus overcome path dependencies and avoid “competency traps” (Danneels 2002; March 1991; Morgan 2012). Given this, more research is clearly needed in the realm of higher-order dynamic marketing capabilities in both domestic and international markets.
Measurement and Analysis Method. Our review of the literature reveals that researchers have generally adopted one of three approaches to empirically in- vestigate marketing capabilities: (1) direct observation using primary case studies, (2) direct primary survey methods, and (3) inference-based approaches using secondary data. The first approach measures mar- keting capabilities through in-depth case studies, and we identified eight such studies in the international marketing research in our sample (for a review, see Table 1). While such case studies provide in-depth understanding of firms’ specific marketing capabilities in international markets, they suffer from small sample size and generalizability problems.
Marketing Capabilities in International Marketing 81
The second approach uses primary survey measures of mar- keting capabilities (for a review, see Table 2), and this is the most frequently used method in studies in international marketing (64%, or 41 of the 64 articles reviewed). Marketing managers responsible for the international market(s) in question generally serve as key informants, and they are asked to rate how well their companies perform various marketing activities, often relative to their major competitors (e.g., Fang and Zou 2009; Spyropoulou et al. 2017). Given the wide- spread use of this method in international marketing research, we further examined the types of operationalizations used in primary survey measures of marketing capabilities in our sample (see Web Appendix B). All 41 studies that use survey approaches use multi-item scales, with the majority (63%) employing seven-point scales and either “much worse/much better” or “strongly agree/strongly disagree” scale anchors. Almost half the studies we reviewed (49%) use absolute (vs. relativetorivals)measuresofcapabilities(i.e.,howwellvarious activities are performed) when asking managers to evaluate theirmarketingcapabilities.3 Themajorityofthestudies(71%) draw on existing conceptualizations and/or measures, primarily from the general domestic marketing capa- bilities literature.
The primary survey approach is a direct method to assess marketing capabilities, and it is flexible in enabling re- searchers to assess different types of marketing capabilities in various cultures and countries. However, there are two main problems with this method. First, with very few ex- ceptions (e.g., Boso et al. 2013), due to the difficulty of col- lectingdatafromthesamefirmsatdifferentpointsintimeover long time frames, survey studies use cross-sectional research designs, mostly with single informants, and are therefore prone to common method bias. Second, data collected via primary surveys cannot empirically establish causal re- lationships that may be hypothesized with marketing ca- pabilities. In addition, this research design approach often limits the number of different control variables that can be included in the data collection.
The third broad approach to assessing firms’ marketing capabilities relies on proxy measures from secondary data to infer a firm’s marketing capabilities (for a review, see Table 3) since no secondary data directly measuring firms marketing capabilities currently exist. There are generally two different methods used in this approach. One method uses marketing resource inputs such as advertising or selling, general, and administrative (SGA) expenditures/sales (e.g.,
De Carolis 2003; Gao et al. 2010; Goerzen, Asmussen, and Nielsen 2013; Kotabe, Srinivasan, and Aulakh 2002) and selling expenses/sales (Anand and Delios 2002) or simply advertising expenses and time spent (Chen 2008; Chen and Hennart 2002; Wu 2013). The inference is that the more a firm allocates resources to something, the more likely it is to be or become good at that thing. This is the most widely adopted method of measuring marketing capabilities using secondary data in international marketing. The second method uses marketing-related outcomes such as repeat client pro- portions(Ethirajetal.2005)toproxyhowwellafirmperforms its marketing activities. This assumes that firms with better observed marketing-related outcomes have superior processes required to perform the activities that may deliver such out- comes. Both approaches have limitations in that the level of both (a) marketing resource deployments and (b) marketing- related outcomes represent only a part of the conceptualization of marketing capabilities as the firm’s ability to use available resources to achieve desirable marketing outcomes.
For this reason, scholars in the general domestic market context have begun to adopt “input-output” approaches using stochastic frontier estimation (SFE) as a third way to use secondary data to measure capabilities. This approach measures marketing capabilities by calibrating how well a firmtransformsagivensetof resources(e.g.,advertising,sales expenses, trademarks) into certain desirable marketing- related outputs. Using SFE, this method estimates the maximum observed efficient frontier among firms in an industry in converting resources into desirable mar- keting output objectives in a sample of firms and then compares this maximum value with the actual resource- to-output performance of each firm in a sample. Greater deviations from the efficiency frontier value represent lower marketing capabilities.
This measurement approach offers several benefits. First, it is well aligned withtheconceptualization of capabilitiesin that it calibrates how well a firm is able to deploy its available re- sources to implement marketing activities that achieve desired marketing outcomes relative to how well rivals do so. Thus, each firm is benchmarked in terms of its marketing capabilities against the best possible practices of firms with similar resources in the industry or sample of firms. Second, because it uses secondary data, this method can enable researchers to examine the drivers and impact of marketing capabilities over longer time periods across firms—which is almost impossible to assess using pri- mary data through case studies or surveys.
However, while this method has many merits and is gaining popularity in domestic market marketing capabilities
3This is often inconsistent with the implicit or explicit conceptu- alization and definition of marketing capabilities used in a study as being anchored on a relative-to-rivals basis.
82 Journal of International Marketing
research (e.g., Dutta, Narasimhan, and Rajiv 2005; Feng, Morgan,andRego2015,2017;XiongandBharadwaj2011), only two of the studies we reviewed of marketing capabilities in international markets have adopted this method (Akdeniz, Gonzalez-Padron, and Calantone 2010; Nath, Nachiappan, and Ramanathan 2010). This may be due to the difficulty of obtaining multiple input and international market output secondary data to calibrate marketing capabilities or to the complexity/newness of this method.
We also examined the major methods of analysis used in exploring the relationships between marketing capabilities and other phenomena in the published international mar- keting research represented in our sample (see Web Ap- pendix C). Most studies in our sample use structural equation modeling, which reflects the relative popularity of studies using primary survey research designs. Regression- based approaches (both hierarchical and nonhierarchical) are also frequently used. The relative infrequency of econometric modeling approaches (including mixed models and fixed or random effects) also makes sense given the infrequent use of panel and time-series data in the studies in our sample.
Antecedents, Moderators, Mediators, and Consequences. The role of marketing capabilities in explaining firm perfor- mance has been of increasing interest to marketing scholars, as many have questioned the value of firms’ marketing activities
and investments (Rust et al. 2004). Generally, the literature suggests that firms with stronger marketing capabilities are betterabletocreatevalueforcustomersandotherstakeholders and thereby achieve and sustain competitive advantage and superior financial performance (Day 1994; Morgan 2012). Though still relatively scant, a growing number of empirical studies have examined the impact of various marketing capabilities on different kinds of firm performance (mainly subjectively assessed) ranging from product-market per- formance indicators, such as sales revenue, market share, sales growth, and customer satisfaction, to financial per- formance outcomes, such as cash flow, profitability, and return on investment (ROI) (Krasnikov and Jayachandran 2008). Research in international marketing also generally shows that marketing capabilities improve firms’ financial and nonfinancial performance in international markets (Tan and Sousa 2015).
Figure 1 synthesizes existing research on marketing capa- bilities in international marketing. Table 6 summarizes representative studies on the antecedents, mediators, and moderators of marketing capabilities in domestic versus international market contexts. This reveals that research on the antecedents of marketing capabilities in both do- mestic and international markets is scarce and has had a very limited focus. This lack of knowledge regarding the drivers of marketing capabilities is surprising given their
Figure 1. Synthesis of Research on Marketing Capabilities in International Marketing
• Resources • Market knowledge • Market orientation • International commitment • Foreign market contact • Entrepreneurial orientation • National export-promotion
programs
• Competitive advantages • Implementation
effectiveness • Strategy • Innovation • International commitment • Entry mode
Marketing Capabilities Firm Outcomes
• Market environment • Institutional conditions • Country environment • Export dependence • Firm reputation • Efficiency • Strategy
Marketing Capabilities in International Marketing 83
Ta bl e 6.
Re se ar ch
on M ar ke tin g Ca pa bi lit ie s in D om
es tic
Ve rs us
In te rn at io na l M ar ke ts
D o m es ti c M
ar k et in g C ap
ab il it y R es ea rc h
In te rn at io n al
M ar k et in g C ap
ab il it y R es ea rc h
C h ar ac te ri st ic s
R ep re se n ta ti ve
St u d ie s
C h ar ac te ri st ic s
R ep re se n ta ti ve
St u d ie s
A n te ce d en ts
R es o u rc es
M o rg an
, K al ek a,
an d
K at si k ea s (2 0 0 4 )
R es o u rc es
F an
g an
d Z o u (2 0 0 9 ); F re em
an an
d St yl es
(2 0 1 4 ); G re go
ry ,
N go
,a n d K ar av
d ic (2 0 1 7 ); K au
fm an
n an
d R o es ch
(2 0 1 2 );
K em
p er ,E
n ge le n ,a
n d B re tt el (2 0 1 1 ); K h av
u le t al .( 2 0 1 0 );
L u et
al . (2 0 1 0 ); Sh
i et
al . (2 0 0 5 ); W
u et
al . (2 0 0 7 )
M ar k et
k n o w le d ge
V o rh ie s, O rr , an
d B u sh
(2 0 1 1 )
M ar k et
k n o w le d ge
E th ir aj
et al . (2 0 0 5 ); M
o rg an
et al . (2 0 0 3 ); Sh
en g et
al .
(2 0 1 5 ); Su
b ra m an
ia m
an d V en k at ra m an
(2 0 0 1 ); W
u et al .
(2 0 0 7 )
M ar k et
o ri en ta ti o n
T ra in o r et
al . (2 0 1 1 )
M ar k et
o ri en ta ti o n
C h en , C h en , an
d Z h o u (2 0 1 4 ); M
u rr ay
, G ao
, an
d K o ta b e
(2 0 1 1 ); O ’C as s an
d N go
(2 0 1 1 ); O zk ay
a et
al . (2 0 1 5 );
P ra sa d , R am
am u rt h y,
an d N ai d u (2 0 0 1 )
St ra te gy
ty p e
V o rh ie s, M
o rg an
, an
d A u tr y (2 0 0 9 )
In te rn at io n al iz at io n m o ti va
ti o n /
co m m it m en t
K au
fm an
n an
d R o es ch
(2 0 1 2 ); K h av
u le t al .( 2 0 1 0 ); K n ig h t,
M ad
se n , an
d Se rv ai s (2 0 0 4 ); W
u et
al . (2 0 0 7 ); Z h o u , W
u ,
an d B ar n es
(2 0 1 2 )
F o re ig n p ar ti ci p at io n /c o n ta ct
F ah
y et
al . (2 0 0 0 ); W
u et
al . (2 0 0 7 )
E n tr ep re n eu ri al
o ri en ta ti o n
L is b o a,
Sk ar m ea s, an
d L ag es
(2 0 1 1 ); O ’C as s an
d N go
(2 0 1 1 )
N at io n al
ex p o rt -p ro m o ti o n
p ro gr am
s L eo n id o u , P al ih aw
ad an
a, an
d T h eo d o si o u (2 0 1 1 )
M ed ia to rs
N .A .
C o m p et it iv e ad
va n ta ge s (e .g .,
lo w -c o st , d if fe re n ti at io n ,
p o si ti o n al , b ra n d , se rv ic e)
K al ek a (2 0 1 1 ); L eo n id o u , P al ih aw
ad an
a, an
d T h eo d o si o u
(2 0 1 1 ); L is b o a,
Sk ar m ea s, an
d L ag
es (2 0 1 1 ); M
o rg an
, K al ek a,
an d K at si k ea s (2 0 0 4 ); T an
an d So
u sa
(2 0 1 5 );
Z o u , F an
g, an
d Z h ao
(2 0 0 3 )
N .A .
St ra te gy
(e .g ., co m p et it iv e st ra te gy
, p ro d u ct
st ra te gy
, d if fe re n ti at io n ,
ex p lo it at io n , ex p lo ra ti o n )
L ag
es , Si lv a,
an d St yl es
(2 0 0 9 ); L eo n id o u , P al ih aw
ad an
a, an
d T h eo d o si o u (2 0 1 1 ); M
o rg an
, K al ek a,
an d K at si k ea s
(2 0 0 4 ); M
u (2 0 1 5 )
N .A .
Im p le m en ta ti o n ef fe ct iv en es s an
d m ar k et in g ef fi ci en cy
G re go
ry ,N
go an
d K ar av
d ic (2 0 1 7 ); M
o rg an
,K at si k ea s, an
d V o rh ie s (2 0 1 2 ); Sp
yr o p o u lo u et
al . (2 0 1 7 )
N .A .
In n o va
ti o n
O zk ay
a et
al . (2 0 1 5 )
N .A .
In te rn at io n al -r el at ed
(e .g .,
co m m it m en t/ in vo
lv em
en t, en tr y
m o d e)
B le sa
an d R ip o ll es
(2 0 0 8 )
84 Journal of International Marketing
Ta bl e 6.
Co nt in ue d D o m es ti c M
ar k et in g C ap
ab il it y R es ea rc h
In te rn at io n al
M ar k et in g C ap
ab il it y R es ea rc h
C h ar ac te ri st ic s
R ep re se n ta ti ve
St u d ie s
C h ar ac te ri st ic s
R ep re se n ta ti ve
St u d ie s
M o d er at o rs
M ar k et
en vi ro n m en t (e .g .,
tu rb u le n ce , co m p et it iv e
in te n si ty )
M cK
ee , V ar ad
ar aj an
, an
d P ri d e (1 9 8 9 );
T ra in o r et
al . (2 0 1 1 )
M ar k et
en vi ro n m en t (e .g ., m ar k et
tu rb u le n ce , u n ce rt ai n ty , co m p et -
it iv e in te n si ty )
B o so
et al .( 2 0 1 3 ); D eS ar b o et al .( 2 0 0 5 ); E rr am
il li ,A
ga rw
al ,
an d D ev
(2 0 0 2 ); F an
g an
d Z o u (2 0 0 9 ); K al ek a an
d M
o rg an
(2 0 1 7 ); M
u rr ay
, G ao
, an
d K o ta b e (2 0 1 1 );
So n g et
al . (2 0 0 5 )
M o m en t o f en tr y
R u iz -O
rt eg a an
d G ar cı́ a- V il la ve rd e
(2 0 0 8 )
In st it u ti o n al
fa ct o rs
(e .g ., o rg an
i- za ti o n al ig n m en ta
n d te ch n o lo gy
, co o rd in at io n m ec h an
is m , cu s-
to m er
st ru ct u re ,d
ec en tr al iz at io n ,
in te rf u n ct io n al
in te gr at io n , p ar t-
n er
re la ti o n sh ip ,o
w n er sh ip
ty p e)
B o so
et al . (2 0 1 3 ); F ah
y et
al . (2 0 0 0 ); K o n w ar
et . al
(2 0 1 7 );
M u (2 0 1 5 ); M
u rr ay
, G ao
, an
d K o ta b e (2 0 1 1 ); P h am
, M
o n k h o u se , an
d B ar n es
(2 0 1 7 ); R ei n ar tz , K ra ff t, an
d H o ye r (2 0 0 4 ); W
u (2 0 1 3 )
C o m p re h en si ve n es s an
d b u d ge ti n g ra ti o n al it y o f
m ar k et in g p la n co n te n t
Sl o te gr aa
f an
d D ic k so n
(2 0 0 4 )
C o u n tr y- sp ec if ic
m ac ro en vi ro n -
m en ta l fa ct o rs
(e .g ., so ci o ec o -
n o m ic
sy st em
, le gi sl at iv e an
d re gu
la ti ve
sy st em
, n at io n al
cu l-
tu re /s o ci al
va lu es , ec o n o m ic
d e-
ve lo p m en t le ve l, m et ro p o li ta n
lo ca ti o n )
D eS ar b o et
al . (2 0 0 5 ); E is en d ,E
va n sc h it zk y,
an d C al an
to n e
(2 0 1 6 ); E rr am
il li , A ga
rw al , an
d D ev
(2 0 0 2 ); G ao
et al .
(2 0 1 0 ); K em
p er ,E
n ge le n ,a n d B re tt el (2 0 1 1 ); K o n w ar
et .a l
(2 0 1 7 ); O zk ay
a et
al . (2 0 1 5 ); So
n g et
al . (2 0 0 8 ); W
u (2 0 1 3 ); Z h o u , W
u , an
d B ar n es
(2 0 1 2 )
M ar k et in g em
p lo ye e d ev el -
o p m en t ca p ab
il it y
O rr , B u sh , an
d V o rh ie s
(2 0 1 1 )
E ff ic ie n cy
N at h , N ac h ia p p an
, an
d R am
an at h an
(2 0 1 0 )
St ra te gy
M u rr ay
, G ao
, an
d K o ta b e (2 0 1 1 )
D eg re e o f ex p o rt
d ep en d en ce
P ra sa d , R am
am u rt h y,
an d N ai d u (2 0 0 1 )
F ir m
re p u ta ti o n
E rr am
il li , A ga
rw al , an
d D ev
(2 0 0 2 )
Marketing Capabilities in International Marketing 85
theoretical importance in explaining marketing’s role in firm performance. Most research on the antecedents of marketing capabilities has been limited to firm resources (e.g., Fang and Zou 2009), market knowledge (e.g., Morgan et al. 2003), and market orientation (e.g., Murray, Gao, and Kotabe 2011). Beyond these variables, explorations of the antecedents of marketing capabilities are frag- mented. Domestic marketing capabilities research has explored strategy type as a driver (Vorhies, Morgan, and Autry 2009), while international marketing ca- pabilities research has studied internationalization motivation/commitment (e.g., Kaufmann and Roesch 2012; Khavul et al. 2010), foreign participation/contact (e.g., Fahy et al. 2000; Wu et al. 2007), entrepreneurial orientation (Lisboa, Skarmeas, and Lages 2011; O’Cass and Ngo 2011), and national export-promotion programs (Leonidou, Palihawadana, and Theodosiou 2011) as drivers. While still small in number, a greater proportion of in- ternational versus domestic studies have explored ante- cedents of marketing capabilities.
Regarding mediators of the marketing capabilities–firm performance relationship, there is relatively little research in domestic market contexts but more such studies in in- ternational markets. Competitive (positional) advantages, business strategy, implementation effectiveness and efficiency, innovation, and international-related factors such as interna- tional commitment, involvement, and entry modes have all been studied as mechanismsby which marketingcapabilities impact firm performance. A meta-analysis by Tan and Sousa (2015) finds that two types of competitive advantage (i.e., low-cost advantage and differentiation advantage) positively mediate the effect of marketing capabilities on financial and nonfinancial export performance. In general, understanding of the mediating mechanisms of how mar- keting capabilities impact firm performance is still in its infancy and remains underresearched in both domestic and international market contexts.
Table 6 also highlights the opportunity to investigate boundary conditions impacting the relationship between marketing capabilities and firm performance in in- ternational markets. Market environment (e.g., turbu- lence, competition) is the most frequently examined boundary condition in both domestic and international markets (e.g., Fang and Zou 2009; Kaleka and Morgan 2017). Explorations of other moderators of the marketing capabilities–firm performance relationship are rather frag- mented. In the international market context, various in- stitutional factors (e.g., organization structure, interfunctional integration, ownership type) and country-specific macro- environmental factors (e.g., socioeconomic and legal systems,
culture and social values, economic development level) have been extensively examined (e.g., Eisend, Evanschitzky, and Calantone 2016; Ozkaya et al. 2015; Wu 2013; Zhou, Wu, and Barnes 2012). Several other moderators such as firm efficiency, strategy, degree of export dependence, and firm reputation have also been explored in different contexts in international marketing (e.g., Erramilli, Agarwal, and Dev 2002; Murray, Gao, and Kotabe 2011; Nath, Nachiappan, and Ramanathan 2010; Prasad, Ramamurthy, and Naidu 2001). In domestic markets, various moderators, such as market entry timing, marketing plan characteristics, and marketing employee development capability, have been explored (e.g., Orr, Bush, and Vorhies 2011; Ruiz-Ortega and Garcı́a-Villaverde 2008; Slotegraaf and Dickson 2004).
However, most of these moderators in international or domestic markets have been examined only once in a single study. Market turbulence is the only moderator that has been repeatedly tested in both domestic and international markets (Fang and Zou 2009; McKee, Varadarajan, and Pride 1989; Song et al. 2005). Unfortunately, researchers have reached conflicting conclusions regarding the impact of market turbulence. For example, Fang and Zou (2009) find that market turbulence enhances the positive impact of marketing capabilities on firms’ competitive advantage and financial performance in IJVs in China. In contrast, Song et al. (2005) find that the impact of marketing capabilities on joint venture performance is weaker in more techno- logically turbulent environments in joint ventures in the United States. Thus, no consensus has been reached re- garding the fragmented moderators of the marketing capability–firm performance relationship proposed in various studies.
ADDITIONAL INSIGHTS FROM PRACTICE
While there is a rich stream of literature in international business and international marketing investigating in- ternationalization, and another in both the general and international marketing literature examining marketing capabilities, these two streams have not generally inter- sected. Given the lack of conceptual and empirical attention to the question of whether and how marketing capabilities may differ in international versus domestic contexts ap- parent in our literature review, we sought additional in- sights on this question from practice. Specifically, we searched for insights addressing the key question “Does marketing capability vary as a company migrates from a local to global focus, and if so, how and in what way?” Thus, from a practical standpoint, we sought to begin to
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understand whether as firms move from a local to an in- ternational orientation, how and in what ways this impacts the firm’s marketing capabilities (if at all).
Given the lack of existing empirical exploration on the topic, and the importance of generating insight from dif- ferent perspectives, we interviewed five C-level executives (three CMOs and two presidents who were once C-level marketers). The interviews were used to identify common conceptual themes that may serve to better illuminate dif- ferences between domestic and global marketing capabil- ities (Corbin and Strauss 2008). The interview protocol designed was reviewed by two academics and a practitioner (Kalton and Anderson 1986). Each reviewer was taken through the interview guide, asked to comment on clarity and length, and given an opportunity to suggest amendments or additional questions. This reviewer input led to revisions of the interview guides, which were then piloted with a C-level executive.
All the interviews were confidential. The executives inter- viewed were from firms that varied in size, industry, ownership (private/public), and customer type (B2B/B2C) (see Web Appendix D). Important for the research design, we ensured that we had balance across degree of in- ternationalization, with two of the firms in expansionary stages of globalization and three firms in mature and broadly terminal stages of global development. This blend was important because, as we anticipated, the challenges faced by firms on either end of the internationalization spectrum may be different. All the executives interviewed held or had held the top marketing position in their firms (i.e., their official titles could have been Chief Marketing Officer or Senior Vice President of Marketing).
To source respondents, we contacted executives within our own and our schools’ networks. Because respondents were geographically dispersed, the interviews were conducted via telephone. The interview protocol consisted of open-ended questions and was structured in three parts: (1) background information related to the respondent (title, years with firm) and to the firm (industry, type of customer, firm size, degree of internationalization, etc.); (2) the general differences in building and managing global (vs. domestic) marketing ca- pabilities; and (3) how specific characteristics (i.e., organization design/structure, process, talent, communication, and management) and capabilities may be associated with firms at varying levels of globalization (and associated with different stages of migration to a global marketing capability).
The fundamental question we asked is what changes with regard to a firm’s marketing capabilities when the firm
chooses to become more international. While a good deal of research attention has focused on examining firm in- ternationalization, little of it has investigated this from a marketing capability perspective. Interestingly, one of the key insights from the interviews was that the answer to this question largely depended on the firm’s degree of in- ternationalization. In our research, three of the firms were fully global, having a majority of their revenue generated from outside the United States and spread across multiple countries. The executives interviewed from these firms were not the architects that shaped the globalization of the firm but, rather, had been placed in positions of authority in an already established global firm. The other two ex- ecutives were members of the C-suite who were trying to increase the global footprints of their firms.
The responses from the two groups varied. Respondents in firmswithestablishedglobaloperationsfounditmoredifficult to articulate how local versus global marketing capabilities were different. This is likely because they were stewards of already global firms rather than their original globalization architects. However, they suggested that the key ways in which local and global marketing capabilities differed cen- tered on the complexity of the processes required to create, align, and manage marketing capabilities. As one commented:
The process of marketing is identical no matter where you are practicing it. This was the most important ‘aha.’ The key is to ensure that everybody is actually using the same process and this is where globalization can lead to complexity. A CMO for one country comes from Unilever and another comes from Procter & Gamble, and another comes from Pepsi. They all bring their own methods for generating consumer insight, their own processes for developing TV ads, their own methods for analyzing data, and even their own approaches to making a recommendation. This is when developing a global marketing capability can become a challenge. The key is to define one process, sell the entire organization on adhering to that one process, and ensure that everybody is trained globally on that process and held accountable for using that one process.
Respondents from the more mature, global firms consis- tently suggested that the difference between local and global marketing capability centered on aligning global leaders in the same direction in terms of using the same marketing processes to help increase speed, agility, and best practices redeployment. As one respondent suggested:
The advantage of having global marketing capabil- ities is in scale, best practice development, and the
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muscle needed to build superior brands. The tension is that people want to do things their own way. Local is closer to the consumer, has better insight into local customs, habits, and practices, which leads to better granular understanding. However, if every country developed their own marketing capabilities, then you wouldn’t have scale, or repeatable processes, or leverage.… Most countries would be less effective because they wouldn’t be implementing proven best practices. While being global can slow things down (moreagile if fighting locally), thebenefit isthat youlearn from other cultures, you have more exposure to different ways of thinking about things, you learn more, and you can reapply to other parts of the world.… Best practices travel. So the priority has to be developing the processes that enable us to capture the learning, synthesize it, and export best practices to the globe. And this is not easy.
As this comment highlights, respondents from the more globally mature companies tended to see mostly positives in developing global marketing capabilities, with the upside benefits of scale and best practice deployment being greater than the downside costs associated with potential lack of flexibility and less localization of marketing processes to deal with differences across countries. In contrast, re- spondents from less globally mature companies focused primarily on the significant resource acquisition (both money and talent) and systems challenges associated with building international marketing capability. In explaining the challenge, one respondent relayed the following story:
At one point, we were essentially a North American firm. While CMO, we decided to launch in two addi- tional countries—one in Asia and one in Latin America. Now you have three climate regions which requires substantial product versioning. We then opened two other stores in another country. Each addition felt like something that was digestible, but, without knowing it, itaddedsignificantcomplexity.Running18promotions per country per year which had to be tailored to the locality … preparing for contingency sales and signage changesevery21days… andthenonecountrywantsto have their own website. You have nuances in the language in social media. There are 500 holidays an- nually across our countries—and they don’t line up globally. We are a fashion company and so things like sizing vary significantly by country.… Going global was a three-year nightmare. To make this even more concrete, we didn’t have the digital asset management systems or really good marketing automation systems or really good translation or even servers that would enable us to transfer huge images for trade show posters sothat FrenchMoroccocangettheright posterandyou
don’t end up starting a holy war. This isn’t funny. We sent something meant for an Asian country to the Middle East, and I was worried that our stores might get bombed. The big challenge is that building global marketing capabilities takes a lot more money and people than senior management want to throw at it. It takes time to generate the revenue and yet you need the resources up front. Everything I mentioned could be fixed with more people and more money … but you don’t get that until you start shipping product globally and generating revenue. This is the problem.
In line with this resource constraints-related problem focus, another less globally mature company respondent also focused on their firm’s resource challenge:
It simply takes a lot more resources—both money and people—to deal with the complexity of developing global marketing capabilities. Our goal is to become 50% global, but it is a chicken and egg problem.… I can’t afford to run research studies in every country, I can’t yet afford to establish regional marketing orga- nizations (instead of managing it from the home office). And by not having local marketing folks, we may have to start developing a dealer/co-op pro- gram because we don’t know the market well enough.… We may have to turn over the marketing to these markets. So without the talent, we can’t effectively replicate the marketing that we conduct in the U.S., and therefore can’t effectively market. I can’t afford the talent until we get the sales.… Back to the chicken and egg problem.
Interestingly, overall, the interviews suggest that firms seeking to become more global by establishing international operations (i.e., moving beyond simply exporting) are more focused on granular levels of lower-level marketing capa- bility development in the countries in which they establish operations. In doing so, they face barriers primarily in obtaining required levels and types of resources to deploy in building such capabilities. In contrast, more globally mature firms are focused on architectural-level capability re- finement and improvement. In doing so, they face barriers in terms of gaining alignment to use common marketing processes when these may not necessarily be the most ap- propriate for the local market conditions.
DISCUSSION AND IMPLICATIONS
Our review of the representative research literature and qualitative fieldwork interviews reveal important gaps in
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conceptual and empirical knowledge regarding marketing capabilities in international marketing. In addition to the specific gaps already highlighted in our review of existing research, in the interests of guiding future research, we focus here on the areas that we think hold the greatest promise for developing theoretically interesting and managerially rele- vant new knowledge in this increasingly important domain.
First, much greater conceptual attention is required to the fundamental question of whether and how international marketing capabilities are intrinsically different from purely domestic marketing capabilities. Our initial qualitative fieldwork data seem to suggest that the answer is “yes” with respect to there being differences in international vs. purely domestic marketing capabilities. However, it is unclear whether this is in terms of requiring different marketing capabilities or simply the ability to deal with the increased complexity created by between-country differences in building and managing broadly the same marketing ca- pabilities. Our fieldwork interviews indicate that at least the latter is the case. They suggest, for example, that building marketing capabilities across country markets requires greater resources and may constrain (or enable) movement from one stage of internationalization to the next. Our interviews also indicate that identifying marketing best practices and processes across different country market- places and standardizing these across market-facing orga- nizational units is required to enjoy benefits of scale.
On the bigger conceptual question of whether international marketing capabilities are fundamentally different in nature from those in purely domestic contexts, our initial fieldwork did not produce any obvious “yes” answer. The international marketing literature we examined is also generally un- developed in this regard. The seven “different” marketing capability examples we uncovered in our review of repre- sentative studies may be viewed as being primarily different in terms of being contextually adapted versions of domestic marketing capabilities. For example, MNCs’ transnational product innovation capability concerns a general product development capabilitythat producesnew productsthat fulfill needs across multiple country markets (Sheng et al. 2015; Subramaniam and Venkatraman 2001). Similarly, over- seas market–related exploitative and explorative capabil- ities (Lisboa, Skarmeas, and Lages 2011) are applications of more general marketing-related capabilities to non- domestic markets. Likewise, both local market competence (Matanda and Ewing 2012; Wu et al. 2007) and adaptive capability (Lu et al. 2010) may be viewed as capturing the abilitytoapply more general market sensing and responsiveness capabilities to various country marketplaces. Both global account management (Shi et al. 2005) and international
customer support (Khavul et al. 2010) capabilities are ap- plications of general customer management capabilities customized to the particular needs of global customers. Finally, global brand management capability (Matanda and Ewing 2012) is the application of brand management in a global setting.
All of this would seem to suggest that the primary difference between international and domestic marketing capabilities concerns the ability to create, maintain, and leverage the same set of general marketing capabilities in ways that cope with context-based variance across country markets and organizational differences across units catering to different markets. Yet, it remains unclear whether such international- versus-domestic market context differences are different in either nature or scale between, for example, a firm operating across multiple different product markets in a single country versus a firm operating in a single product-market segment across different country marketplaces. Beyond the need to be adapted to contextual international differences, are there any novel capabilities that are required solely for marketing in international markets? Conceptual and empirical re- search on this fundamental question is sorely needed.
Second, while it is true that the antecedents of marketing capabilities and mechanisms by which marketing capabilities may contribute to performance outcomes have generally been a greater focus of researchers in international versus domesticmarketingcontexts,muchremainstobeexplored.In particular, some of the antecedents explored in a domestic market context have received very little attention in an in- ternational market context. For example, how does the presence of a CMO or marketing department power within the firm affect international marketing capabilities? Similarly, some of the capability–performance mechanisms explored in a domestic market context have received little research attention in international marketing. For example, studies in a domestic market context have shown that an important route by which marketing capabilities contribute to firm perfor- mance is by “adding value” to a firm’s assets, such as market knowledge (e.g., Morgan, Vorhies, and Mason 2009) or brands (e.g., Wiles, Morgan, and Rego 2012). Does this also occur in leveraging firms’ assets across country marketplaces? If so, are marketing capabilities more complementary to some types of assets than others? Do these assets differ between within and across country contexts?
In addition, from a performance-enhancing mechanism per- spective, our qualitative fieldwork suggests that there may be marketing capability economies of scale and scope available to a firm operating across country marketplaces. In particular, our interviews suggest that global firms may be exposed to a
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greater variety of different marketing practices from which they can select “best practices” and standardize these across their myriad different organizational units across country markets. Essentially, countries operate as test markets through which best practices are identified and then exported to other markets within the firm. These are potential performance-enhancing mechanisms of marketing capabil- ities in international marketing that have received almost no research attention to date. If these marketing capability performance-enhancing mechanisms do exist in global firms, how may they be different in nature and scale from those available to domestic firms operating across multiple dif- ferent product markets in a single country? For example, are domestic firms exposed to less variety in marketing prac- tices but find it easier to transfer best practices among or- ganizational units, or vice versa? In addition, what are the downside costs associated with such cross-country stan- dardization? When may these outweigh the benefits?
Third, our fieldwork and observations across some of the studies we reviewed strongly suggest that a key difference of marketing capabilities in international marketing is the ability to operate effectively and efficiently within and across the organizational units by which firms interact with different country marketplaces. Importantly, this suggests that mar- keting capabilities will likely differ across firms in different stages of internationalization. In our review of the in- ternational marketing literature, we found numerous studies of marketing capabilities within stages of internationalization. For example, a large (and growing) number of studies examine marketing capabilities in exporting manufacturers, and a smaller(butalsogrowing)numberofstudiesdosoinMNCand IJV contexts. However, there have been few (if any) studies that examine the extent to which marketing capabilities (and their antecedents, consequences, moderators, and mediators) differ across firms at different stages of internationalization. There maybemuchtobelearnedfromsuchstudies,includinganswers to questions such as the following: (1) Does “fit” between marketing capabilities and stage of internationalization impact firmperformance?(2)Whatistheroleofmarketingcapability development in enhancing or inhibiting firms’ movement from one stage of internationalization to another?
This naturally also leads to additional questions about the nature of dynamic marketing capabilities. Dynamic capa- bilities theory is oft-cited but has been infrequently em- pirically studied in international marketing research. Firms operating in international markets may be exposed to a greater variety of marketplace environments, all of which may be changing in different ways and at different rates. The need to effectively and efficiently deal with such dy- namic complexity would suggest that dynamic marketing
capabilities may be particularly valuable for firms operating in international markets. Yet, difficulties in measuring such marketing capabilities in a dynamic manner (i.e., observing shifts in firms’ resource and capability configurations over time that are driven by marketplace change or anticipated change) using primary case study and survey research de- signs have severely limited our knowledge to date. This is perhaps why we currently know much more about firms’ ability to sense their marketplace environments than we do about how they are able to acquire, improve, and recon- figure marketing-related resources and capabilities designed to match the changing marketplace environments they face.
However, it is possible to design even survey-based mea- sures that better capture the dynamic (vs. static) aspects and changing nature of marketing capabilities, and researchers should be encouraged to do so in order to explore how firms evaluate, develop, integrate, monitor, and manage such dynamic marketing capabilities. Alternatively, researchers can explore using secondary data approaches in panel data where firm-specific changes over time may be used to infer such dynamic marketing capabilities, and this may offer another route forward for future research.
Perhaps even more important from a practice perspective is the question of how marketing capabilities—dynamic and operational—can best be built, maintained, improved, and leveraged in firms operating in international markets. Drawing on the sizable and growing research literature, there appears to be little doubt that marketing capabilities are generallyvaluableinenablingfirmsoperatingininternational markets to enjoy superior performance. Research to date is helpful for managers in understanding what types of mar- keting capabilities may be particularly valuable under certain conditions. However, once they understand and believe in the performance-enhancing value of marketing capabilities, man- agers inevitably want to know, “How do I build such capa- bilities in my firm?” While international marketing researchers have studied several antecedents of marketing capabilities, al- most all of these have been from the perspective of different typesof knowledgeand otherresourceinputsthat aredeployed by various marketing capabilities. We have little or no knowledge of how marketing capabilities can be deliberately and proactively built and improved to match the international marketplaceenvironmentsfaced.Yet,theoreticallytheabilityto do so is a core component of dynamic marketing capabilities. It is also among the primary questions that managers would like answered: How should I go about building marketing capa- bilities across country markets? Which skills are portable and which are not? Who should own marketing capability devel- opment and compliance? All these key managerial questions are currently unanswered in existing research.
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CONCLUSIONS
Marketing capability has been a growing area of interest among international marketing researchers. Despite the progress in unpacking the performance implications, drivers, moderators, and mediators of marketing capabilities, our review of the literature and qualitative fieldwork interviews revealimportantgapsinconceptualandempiricalknowledge regarding marketing capabilities in international marketing. Clearly, there remains important work to be done in this theoretically important and managerially interesting domain. This study provides a number of new directions that may be helpful in guiding research attention to those questions that may offer the greatest contributions to both theory and practice in international marketing.
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