Market orientation, marketing capability, and new product performance: the moderating role of absorptive capacity

The recent marketing literature identifies market orientation and marketing capabilities as key concepts that firms should use to achieve their competitive advantages. Previous research also confirms cross effects of these dimensions in firms' performance. The present study extends the literature on this subject by introducing absorptive capacity (AC) as a moderator of the relationship among market orientation, the interaction of market orientation and marketing capability, and firms' new product performance. This study empirically examines the research model using survey data from 188 manufacturing firms in Sweden. The findings confirm previous studies that claim a positive relationship among market orientation, marketing capability, and new product performance. More importantly, the results indicate that AC positively moderates the relationship between market orientation and firms' new product performance. Furthermore, the findings suggest that experts should consider AC as a competitive factor in line with the complimentary effect of market orientation and marketing capability. This consideration would contribute to explain better firm-related performance, such as new product performance.