Market orientation, service quality and business profitability: a conceptual model and empirical evidence

Abstract

The authors explore the relationships among market orientation, service quality and business profitability. Based on an empirical study of Taiwan’s security brokerage service industry, the research results show that there are positive associations among the three constructs. More market‐oriented brokerage service firms seem to enjoy superior service quality perceptions and greater profitability. Further examinations reveal that market orientation has a stronger effect on service quality than on business profitability. Also, the service quality‐profitability linkage is stronger than the market orientation‐profitability linkage. The results suggest that service quality is an intermediate factor in the market orientation‐profitability relationship and is a better indicator of the effectiveness of a market‐oriented campaign than profitability measures.

Citation

Chang, T. and Chen, S. (1998), "Market orientation, service quality and business profitability: a conceptual model and empirical evidence", Journal of Services Marketing, Vol. 12 No. 4, pp. 246-264. https://doi.org/10.1108/08876049810226937