Impact of industry competitive intensity on brand performance: mediating role of market orientation and organizational learning

Abstract

Purpose The purpose of this paper is to investigate the effect of industry competitive intensity (ICI) on brand performance with the mediating role of market orientation and organizational learning using theoretical and experimental materials in fast-moving consumer goods (FMCGs) firms. Design/methodology/approach To test the research hypotheses, a model was designed and tested on 124 chief executive officers from 30 FMCG firms active in both food and chemical industries using structural equation modeling and partial least squares methodology. Findings The research findings showed that ICI has significant effect on market orientation and organizational learning. It also has significant effect on the firm’s brand performance through developing the market orientation capability as a mediating variable, but the development of organizational learning capability (as a mediating variable) is not effective in the relationship between ICI and brand performance. Originality/value Since the early 1990s, addressing intraorganizational capabilities and resources has been a major topic of strategic and marketing research. In this regard, many theoretical and experimental contents have been presented so far. However, little research has simultaneously addressed the industrial environment and the development of competitive capabilities. A manager’s understanding of the competition rate of an industry has the potential to influence the development of organizational capabilities through strategic responsiveness to his/her perception of the environment. This study attempts to show that managers and firms that consider their industrial environment to be volatile must develop their learning capabilities and market orientation, leading to superior brand performance.