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Development of Customer-Orientation, Brand-Orientation and Business Performance within the First Ten Years of the Firm

Katharina Buttenberg

Abstract


The business performance of young firms is significantly influenced by customer- and brand-oriented capabilities. These capabilities can be sustained competitive advantages for firms from an early age on and managers need to consciously develop them over time. In the first years, the development of these firms is still highly dependent on their environment. The products and services are still under development, and there are only little resources and market information available. Therefore, the development of customer-orientation, brand-orientation and their impact on business performance at this age is crucial to be understood for founders to appropriately manage these capabilities. The purpose of this article is to provide insights on how customer-orientation and brand-orientation vary across the three age groups of up to two years, two to five years and five to ten years. The paper is based on a quantitative analysis of 413 completed and usable surveys of founders of young firms at an age of up to ten years. Latent variables of customer- and brand-oriented capabilities as well as business performance were structured and analyzed for their components. In an analysis of variance, the differences in these variables between the age groups of up to two years, two to five years and older than five years are analyzed. Between the age groups, the three variables of customer-orientation, brand-orientation and business performance develop differently. While customer-orientation does not vary significantly, components of brand-orientation do. Business-performance even displays a crossover-effect of items. 


Keywords


management; firm age; customer-orientation; brand-orientation; resource-based theory

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References


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