Examining the Impact of Marketing Technology on SME Performance in Malaysia: The Interplay of Absorptive Capacity, Competitive Environment and Firm Size
List of Authors
Abu Bakar Sade, Eng Wah Teh, Hon Tat Huam
Keyword
Absorptive capacity, marketing technology, technology adoption, firm performance, SME performance
Abstract
This quantitative study examined the influence of marketing technology adoption on small and medium enterprise (SME) performance in Malaysia. The mediator was absorptive capacity, and the moderating factors were competitive environment and firm size. Data were collected from 160 SMEs in the services and manufacturing sectors using structured questionnaires. The hypothesised relationships among marketing technology adoption, absorptive capacity, SME performance, competitive environment, and firm size were tested using partial least squares-structural equation modelling (PLS-SEM). The mediation and moderation effects were analysed to determine the indirect and conditional influences on SME performance. Marketing technology adoption significantly positively affected SME performance. Absorptive capacity partially mediated the relationship, which suggested that the ability to acquire, assimilate, transform, and exploit external knowledge enhances the technology adoption benefits. Competitive environment and firm size did not moderate the direct and indirect relationships in the model. The results affirmed that marketing technology adoption must be paired with absorptive capacity to enhance firm performance. The results also underscored the importance of internal capabilities over external environments in driving marketing technology adoption benefits to SMEs. These insights enriched the absorptive capacity theory, the technology-organisation-environment framework, and contingency theory in the SME context. The SME leaders should build absorptive capacity to fully realise the organisational benefits of marketing technology adoption. Furthermore, policymakers and technology solution providers should promote technology adoption and support to strengthen SME internal capabilities for knowledge absorption.