Marketing and performance in small firms: the role of networking

Abstract

Purpose The purpose of the paper is to advance knowledge of small firm performance by explicating how networking helps small firms carry out marketing and perform better. Design/methodology/approach An online survey of small firm owner-managers in a regional economy of the UK was executed. Hypotheses were tested including the proposition that networking proactiveness moderates the relationship between market orientation (MO) and performance. Findings It was found that networking is undertaken by all small firms across a spectrum of business types. Networking is seen as applicable, it results in valuable outcomes and these outcomes contribute to marketing. The contribution increases with firm size and is valued more in small firms with a dedicated marketing function. Proactive networking creates greater value than reactive networking, but proactive networking in and of itself does not lead to greater performance. Rather, networking proactiveness moderates the relationship between MO and performance. Practical implications It is argued that networking should not be dismissed as “not quite proper” marketing and should be harnessed as a way of compensating for marketing activities that are outside the reach of the small firm. Small firms are advised to adopt a proactive approach to their networking activities, as without a reasonable level of proactiveness, there is likely to be no benefit in being market oriented. Originality/value There has been little research that has examined the specific ways in which networking contributes to marketing and none that probes if and to what extent this contribution makes a difference to overall firm performance. This paper addresses this gap.