Market orientation and business performance in hotels in Cape Coast: mediating role of innovation

Abstract

Due to the turbulent and dynamic nature of the business environment, creating and sustaining competitive advantage demands a company to develop a formidable company-wide market-oriented culture. The study adopted a quantitative research approach in its analysis. The purpose of the study was to examine the link between market orientation, innovation and performance. The total population of hotels at the study area was 159. Of this number, the study used simple random sampling method to select 79 respondents for the study. The respondents of the study were the managers/owners of the hotels. Data was collected through survey questionnaire and analysed through the use of PLS-SEM version 2.0, inferential statistics were used for the interpretation and discussion of findings. The results of the study showed that the level of market orientation practices among hotels in Cape Coast is low. The findings further revealed that a strong positive relationship exists between market orientation and business performance. Again, the findings disclosed that market orientation has positive correlation with firms’ innovativeness and innovation mediated market orientation and firms’ performance. Finally, the findings established a strong positive relationship between firms’ innovativeness and firms’ performance. The study found the mediation role of innovation very significant. The study thus concluded that a positive association exists between market orientation, innovation, and performance. The study, therefore, recommends that hotels in Cape Coast put much emphasis on marketing research in order to develop an innovative market orientation strategy.