Market fit, market orientation, and business performance : an empirical investigation

This thesis investigated the congruence of an organisation to its intended target markets. It was hypothesised that the internal activities of an organisation are, potentially, structured in response to its market dynamics with the ultimate aim of achieving the organisational objective(s). Market fit has been conceptualised to represent the fit of an organisation to its operating market environment. The information for this study was collected from senior marketing decision makers, using a self-administered questionnaire. The sample comprised 216 companies from a mix of industries and organisational sizes in Australia. There is evidence to suggest that the association of market orientation and business performance is inconsistent under different business operating circumstances, due to the exclusion of the influence of key environmental moderators. The model of market fit attempts to overcome this condition. The results suggest that market fit is associated with measures of business performance, and the levels of association are different from those related to the market orientation measures, reflecting the influence of moderators. The categories of environmental moderators contributing at different levels to the market fit measure include: (1) marketing planning, (2) implementation of marketing decisions, (3) market orientation, (4) market strength, (5) generic strategies, (6) organisational culture, (7) familiarity with the marketing audit, and (8) the external environment. The marketing audit procedure has been recommended as a tool to assist with the establishment and maintenance of market fit. The results of this study indicate that organisational familiarity with, and the conduct of, the marketing audit periodically are low, and that market fit may be a better predictor of business performance, than is market orientation.