Marketing Standardization and Performance of Korean Exporters: Moderating Effect of Functional Integration and Absorptive Capacity

Abstract

The objective of this study is to explore the nature of the relationship between marketing standardization and organizational performance in international markets. Previous research has reported inconsistent findings concerning the performance implications of marketing standardization–the effect might be either positive, negative or not significant. Recent empirical studies have argued the focal relationship may be contingent on various firm-internal and -external factors. Given the lack of theoretical underpinnings within the international marketing strategy literature, we apply the information processing perspective to explain the effectiveness of standardized marketing can vary depending upon crucial organizational characteristics such as functional integration and absorptive capacity within the organization. We test the proposed hypotheses with survey data collected from 178 manufacturing exporters in Korea. Multiple regression results indicate that the positive relationship between standardization of marketing activities and performance can be stronger for firms with greater functional integration and absorptive capacity. This study sheds light on the role of functional integration and absorptive capacity that will facilitate information processing within an organization, which in turn will enhance the utility of marketing standardization in international markets