The Mediating Role of Innovation in Strategic International Marketing

The Mediating Role of Innovation in Strategic International Marketing

Ho Yin Wong (Deakin University, Australia)
DOI: 10.4018/978-1-4666-6220-9.ch002


The purpose of this chapter is to empirically examine the mediating role of innovation in strategic international marketing. The theoretical model consists of four variables: firm commitment, innovation, promotion strategy, and firm performance. It is conceptualized that firm commitment influences innovation that mediates the promotion variable, which in turn affects firm performance. A mail-out survey to Australian firms involved in international marketing gathered 315 useable responses. The whole theoretical model was tested using the structural equation modelling, partial disaggregation method. The findings confirm significant relationships among the variables in the theoretical model. All major fit indices from structural equation modelling analysis show satisfactory results for both the measurement model and the structural model. The findings shed light on the deployment of resources and capabilities such as human and financial resources, innovation, and promotion strategy to enhance firm performance. The major contributions of this chapter are the establishment of the mediating role of innovation on promotion strategy and the variables from the resources and capabilities perspective affecting firm performance.
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Theoretical Background

Since there are numerous ways of examining what affects firm performance, it is necessary to draw on a theoretical paradigm to establish the foundation for the development of a conceptual model. The resources and capability paradigm is adopted due to its ability to identify and explain factors which are controllable by marketing managers when trying to enhance firm performance (Wong & Merrilees, 2007).

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