Exploring the link between market orientation and innovation in the European and US insurance markets

Abstract

Despite the increasing research importance of market orientation in the marketing literature, few comparative studies between the European Union and the USA have been conducted. This limits the understanding of marketing orientation strategy in global markets. Investigates the influence of competitive environments on the uses of market orientation in insurance firms in the EU and the USA and the effects of market orientation on innovations. Using Lambin's conceptualization of market orientation, our results indicate that, although EU and US insurance firms analyze and react to their environment differently, which in turn is reflected in a differential impact on their degree of innovation, this, however, does not translate into overall market orientation differences across markets, differential relations across markets between overall market orientation and innovation degree and innovation performance. Furthermore, there is a positive impact of overall market orientation on insurance firms' innovation degree and innovation performance in both the US and EU markets. The managerial implications of these findings seem clear: the magnitude and the effectiveness of the innovation activities of a firm can be enhanced through the adoption of market orientation principles. IntroductionThere is a growing interest in the concept of market orientation, as empirical evidence shows that companies with higher market orientation obtain better economic and commercial results. Researchers have extensively collected evidence of the positive effect of market orientation on business performance. We have attempted to summarize these empirical results in Table I. However, it is not yet clear why there is such effect and how it operates (Lambin, 1996). The most recent literature suggests that one of the keys to understanding this phenomenon lies in market orientation's positive effect on businesses' degree of innovation

Marketing Practices and Performance in a Post-Crisis Scenario

“…Market Orientation measures are based on the study by Lado, Maydeu-Olivares, and Rivera (1998) and by Lado, and Maydeu-Olivares (2001). Appendix 1 presents marketing practices measures.…”

Analysis of Market Orientation on Business Performance in the Multinational Service Industries

“…Hortinha et al (2011) observed a positive relationship between market orientation and business performance. Researchers such as: Kohli and Jaworski (1996;Slater and Narver, 1994;Lado and Maydeu-Olivares, 2001;Yoon and Lee, 2005;Lai et al, 2009;Mahmoud et al, 2010;Smirnova et al, 2011;Bahman and Mehdi, 2011;Mashahadia et al, 2016) have all observed a positive relationship between market orientation and business performance. According to Herhausen (2016) market orientation has an incremental positive effect on business performance.…”

Relationships Between Market Orientation, Non-Technological Innovation, and Business Performance at Small and Medium Industries (Smi)

“…According to Lado & Maydeu-Olivares (2001), a model of market orientation should focus on innovation, which is defined as the implementation of ideas, products, or new processes, as a primary strategy to respond the market changes. This is according to Han et al (1998) suggest that market orientation is a primary determinant of innovation.…”

“…Interest in the study of the concept of market orientation caused by empirical evidence shows that companies with higher market orientation tend to get higher business performance. Many researchers have found empirical evidence of the positive effect of a market orientation on business performance (Lado & Maydeu-Olivares, 2001). Narver and Slater (1990), provides an understanding of market orientation, suggesting that the market orientation mainly consists of three orientations of behavior that is customer orientation, competitor orientation, and inter-functional coordination.…”