Market Orientation and Business Performance

The given assignment is a compilation of research papers and studies that analyze the relationship between market orientation and business performance. It includes a list of references to 20 academic papers, primarily from journals such as Journal of Marketing Management, International Marketing Review, and Journal of Business Ethics. The papers examine how market orientation influences business performance in different contexts, including the franchising industry, retail sector, and hospitality enterprises. The assignment also covers the moderating role of supply chain influence and internal market orientation in hotels. Overall, the compilation aims to provide a comprehensive understanding of the effectiveness of market orientation across various business settings.

Running head: MARKETING AND FINANCE
Marketing and Finance
University Name
Student Name
Authors’ Note

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MARKETING AND FINANCE
Table of Contents
Introduction................................................................................................................................2
1. Assessment of current market orientation of Northampton Balloons Ltd.............................3
2. Recommendations for stronger market orientation................................................................7
3. Recognition of financial implication for the company for the identified market sector........8
4. Discussion of advantages and disadvantages for each of the alternatives:............................8
Conclusion................................................................................................................................12
References................................................................................................................................13

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MARKETING AND FINANCE
Introduction
The current study presents a report to the board of directors of the firm Northampton
Balloons Ltd regarding philosophy of the firm Northampton Balloons Ltd to satisfy needs of
the customers and the current market orientation. The study at hand also examines the extent
to which the company has succeeded in exploring and satisfying the requirements as well as
desires of customers by means of product mix. Unlike past marketing stratagems that focused
on establishing selling points for subsisting products, market orientation runs in reverse,
trying to customize products to satisfy customer’s demand. In addition to this, this study also
presents suggestions regarding enhancement of market orientation of the company and
identified the financial implications for two identified sectors of the market. Moving further,
this study also discusses in detail both the advantages as well as disadvantages of different
sources of finance available to the company.
1. Assessment of current market orientation of Northampton Balloons Ltd
Market orientation is necessarily organization wide development of market intelligence
pertaining to current and future needs of the customers, dissemination of intelligence across
various departments, organization wide responsiveness to the needs of the customers
(Appiah-Adu and Djokoto 2015).
Elements of Market Orientation: Market orientation refers to a business approach or else
philosophy that concentrate on recognizing and satisfying the mentioned or hidden wants of
customers (Lewrick et al. 2015).
Customer Concern throughout the business: As per the given case, Northampton Balloons
also started its business as a manufacturer of hot air balloons. Thereafter, management of the

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MARKETING AND FINANCEcompany identified the concern of customers to have hot air balloons for promotional
purposes. The company recognized about promotional hot air balloon market.
Customer choice criteria and match with marketing mix: product contains two different
components namely tangible and intangible components (Sievers et al. 2016). Northampton
Balloons as a retailer meets both the components of product as the intangible product
(microlite aircraft and aircraft that necessarily weighs around 300 kg for particularly single
seat plane and approximately 450 kg for a double seat) and satisfies various intangible
components of a product (value of brand, satisfaction of customers and many others).
Segment by customer differences: There are specific set of customers for the promotional
hot air balloons. Previously, product of the company had a targeted segment of customers that
took in middle aged population and comparatively wealthy market of enthusiasts. The
product of the company can be used as hot air balloons for promotions and can have a
specific set of corporate customers. In addition to this, there are other segments that include
flying enthusiasts who are excited about the microlite aircraft. However, as per the case
study, it can be observed that there is absence of appropriate segmentation and positioning
policy.
Invest in market research and tracking market changes: As per the given case study,
Northampton Balloons conducted a superficial market research. The company eagerly
entered the market of hot air balloons for promotions. Although initially the company earned
profit, the sales figure began to dwindle after the first six months.
Welcoming change: Company Northampton Balloons focuses on the entire market and
shows company’s attempt to become market oriented. Management of the company responds
proactively to the needs, tastes as well as preferences of customers (Tomczak et al. 2018).
Manufacturer of hot air balloons who previously used to carry six passengers modified the

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MARKETING AND FINANCEproduct as per alterations in needs of customers. After recognizing potential of the market for
hot air balloons as a vehicle for promotion, management of the company started formulating
as well as manufacturing hot air balloons for their clients in different shapes and sizes
counting different kinds of clothing, cans, bottles, running shoes and many others. This can
be referred to as a welcoming change and indicates towards market orientation of the
company.
Trying to understand competition
Competitors too matter for market orientation (He et al. 2018). As per the given case, the
company Northampton Balloons also have a number of competitors that are providing the
same product and service. Also, the company stands third and fourth that deliver the greatest
potential.
Marketing spend regarded as investment
An important feature of market driven business is the marketing research expend that can
yield rich rewards by means of better understanding of the customers (Loe and Ferrell 2015).
The company Northampton Balloons has also made some investments in undertaking
innovative manufacturing exercises as well as modern technology for the purpose of ensuring
efficacy. However a minimum threshold investment is necessary for marketing their product
(for example, promotional budget that can be used for posters else wise sales promotion for
attracting and retaining customers. Also, the company lacks in constructive and formal
marketing planning. The effort for enhancement of sales has also been largely thoughtless
and has depended hugely on word of mouth along with general interest generated by the
special newspaper feature or else programme on television (Lee et al. 2015).

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MARKETING AND FINANCEInnovation rewarded
Search for latent markets: The market for microlite aircraft can be said to be a latent
market. There are basically many flying fanatics who either cannot afford an actual aircraft or
else are attracted by the way in which microlite can help in recreating old days of flying. The
company also serves only in Great Britain although the marketing license of the company
covers numerous nations for which there is now firm evidence that a substantial sales
potential subsists.
Responsive
In responsive form of market orientation, business firm has the need to concentrate on
immediate needs of the customers and has the tendency to be market driven (Kiessling et al.
2016). The company Northampton Balloons has also changed its offerings and modified the
same. According to the given case study, it can be hereby said that this approach of the
company to marketing was to large extent reactive and there was inappropriate understanding
of the purchasers’ motives or else focus of marketing effort.
Strive for competitive advantage:
In case of Northampton Balloons little or no effort is made to understand the needs of the
purchasers and the offerings of other players in the market. Also, there is no effort intended to
serve their customers better than the rivals.

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MARKETING AND FINANCE
2. Recommendations for stronger market orientation
Wants of the customers throughout the business need to be considered as paramount and the
business concern have the need to alter its offerings in line with any alteration in preference
of the customer.
Customer choice criteria are to have a promotional hot air balloon. Founded on
comprehension of customers, a corporation has the need to develop a suitable marketing mix.
Product is a significant component of marketing mix, without which the procedure of
marketing mix cannot start off. Therefore, the product can be designed as per the choice of
the customers. Core product is essentially the most significant aspect of the product (Frösén
et al. 2016). Therefore, in order to differentiate product of the company Northampton
Balloons it is important to differentiate the product from the other brand and need to have a
bigger brand. This refers to creation of higher value that necessarily has input of both
quantity as well as quality.
Analysis of data using regional analysis, product line analysis and other analysis can help
Northampton Balloons to segment the market more effectually.
Therefore, the company could have invested money for the purpose of conducting adequate
market research before starting its operations. The effort for enhancement of sales has also
been largely thoughtless and a minimum threshold investment is necessary for marketing
their product (for example, promotional budget that can be used for posters else wise sales
promotion for attracting and retaining customers (Lim et al. 2017)
The company Northampton Balloons also have a number of competitors that are providing
the same product and service. Competitors are also important for market orientation.
Therefore, specific marketing orientation strategies with regard to understanding the

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MARKETING AND FINANCEcompetition need to be developed. Porter Forces Analysis can help the company in
understanding its competitive position and subsequently develop strategy (Kasim et al. 2018).
In addition to this, company also requires higher inward investment for attainment for
proactive approach to marketing. Also, as a marketing-orientated business concern that
they need to make every effort for competitive advantage (Fang et al. 2014). Essentially, they
intend to serve their customers better than the rivals.
The company also serves only in Great Britain although the marketing license of the
company covers numerous nations for which there is now firm evidence that a substantial
sales potential subsists. Therefore, management of the company can improve the market
orientation by gaining knowledge regarding the latent markets and thereafter start operations
in the identified markets.
3. Recognition of financial implication for the company for the identified market sector
Approach of the company’s to marketing can be considered to be largely reactive, attempts of
venture by the company can be said to be extremely successful. The company developed a
brand reputation both for superior quality and ingenious designs of the products. As
mentioned in the case study, the management decided to sell a 51% stake in the corporation
to inject a huge sum of cash into the corporation to finance future growth. However, this
stake was purchased by a mini conglomerate that until recently has permitted Northampton to
function without interference.
4. Discussion of advantages and disadvantages for each of the alternatives:
- Borrowing as a source of finance:

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MARKETING AND FINANCEManagement of the company Northampton Balloons can consider borrowing as a viable
option for acquirement of funds. By way of borrowing funds the company can acquire the
advantages of:
- Flexibility: With regard to borrowings, the firm only has the need to worry about
disbursement of the instalment payments on a regular basis (Tomczak et al. 2018).
Essentially this can be regarded as a benefit over particularly overdrafts where the firm needs
to pay the entire amount when the bank demands.
- Cost Effective: Borrowing of money can be considered to be feasible option when
considered in terms of rate of interest. In terms of rate of interest, borrowed funds are
normally the cheaper alternative as against overdrafts as well as credits (Lewrick et al. 2015).
- Retained Earnings: Whilst businesses that essentially issue equity for the purpose of raising
capital generally provide a certain percentage of their profit to their shareholders of the firm,
banks require borrowers to disburse only the principal amount along with interest amount on
raised loan. This is in turn can help the business Northampton Balloons in retaining all the
business profits.
- Tax Benefits: Amount of interest disbursed on the loan is necessarily a tax deductible
expense. Therefore, this can also be cited as a specific advantage of borrowing money.
Disadvantages of borrowing money by Northampton Balloons
Stringent Requirements: As there are numerous banks that require some kind of collateral,
different start-ups firms along with existing businesses that possess no assets can find it to be
very difficult to get approval for the loan applications (Lewrick et al. 2015).
Burden of repayment: Loan borrower, specifically Northampton Balloons in this case has the
need to disburse specific amounts on a periodic for repayment of the amounts borrowed

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MARKETING AND FINANCE(Lewrick et al. 2015). Essentially, the ones who fall behind on payment encounter the
prospect of having their assets seized.
Irregular payment amounts: In case if the firm Northampton Balloons acquires a bank loan
with a variable rate of interest, the specific rate alters with conditions of the market.
-Investment as a source of finance: Investment can be considered to be the permanent
solution to various financial requirements of a corporation. Main focus of the company is
necessarily not necessarily financial management. Equity finance can deliver that leverage to
management to persistently concentrate on satisfaction of core objectives. Essentially, this
keeps firm’s management away from the problems of raising funds. As rightly indicated by
Tomczak et al. (2018), with equity money from financiers, the owner of the firm can get
relived of diverse pressures to satisfy the deadlines of fixed loan disbursements. Nevertheless,
management does not have the need to quit control of the business and often has the
requirement to consult with financiers when arriving at major decisions.
Advantages of equity
Low risk: Management of Northampton Balloons might face comparatively less risk with
equity financing as it does not have any fixed monthly loan disbursements to make (Lee et al.
2015).
Credit Issues: In case if the company Northampton Balloons encounters credit issues, then in
that case equity financing might perhaps be the only choice of acquirement of funds for
specifically funding growth.
Flow of cash: Equity financing does not necessarily take money out of business. Contrarily,
the disbursements for loan repayments involved in case of debt financing extract funds out of
business, thereby decreasing the requisite money needed to fund growth of the company.

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MARKETING AND FINANCELong term arrangement and planning: Equity financiers necessarily do not anticipate
getting an immediate return on amount invested (Lee et al. 2015). As such, these financiers
have a broad view and have the capability to look beyond the short term and face the
probability of losing the money in case of failure of business.
-Profits as a source of finance: Profit earned by the firm can be considered to be a viable
option of financing that can be utilized in different ways (Lim et al. 2017). In this case,
Northampton Balloons can obtain the benefit of high retained earnings as a source of finance
as this leads to enhancement in value of stock, assurance of corporate stability and providing
finances for research as well as expansion without escalating corporate debt. Disadvantages
of profit as a source of finance can be explained in context of inefficiency. The business
concern is better off borrowing funds at a comparatively lower rate than the prevailing rate of
interest. Another limitation of the retained profit as a source of finance is that there might be
improper usage of finances (Fang et al. 2014). In case if the main purpose of utilization of
retained earnings is not distinctly mentioned then in that case it might perhaps lead to
excessive spending. In addition to this, this source might lead to over-capitalization.
Furthermore, there is low rate of dividend and retained earning does not permit shareholders
to take pleasure in full benefit of the real earnings of the firm Northampton Balloons.
Disadvantages of equity financing
Cost incurred: Equity financiers anticipate getting a return on their money (Fang et al.
2014). Business owner of the company Northampton Balloons need to be eager to share some
of the profit’s of the corporation with partners of equity. The total amount of money paid to
partners can be essentially higher than the rates of interest on particularly debt financing.
Loss of control: The owner of the firm Northampton Balloons has the need to give up certain
control of the control when management takes on supplementary financiers. Basically, equity

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MARKETING AND FINANCEpartners have the requirement to have a voice in arriving at a decision regarding the business,
particularly the big decisions.
Capability of conflict: All the business partners shall not always agree at the time of making
decisions (Ruizalba et al. 2014). In essence, these conflicts might perhaps erupt from diverse
visions for the corporation and disagreements on styles of management.
Conclusion
The current study report presented to the board of directors of the firm Northampton Balloons
Ltd helps in understanding philosophy of the firm Northampton Balloons Ltd to meet needs
of the customers. The study at hand takes into consideration all the elements of market
orientation and examines the extent to which the company has succeeded in satisfying the
meeting needs of customers. In addition to this, this study also suggests ways of enhancing
market orientation of the company and elucidated the financial implications for two identified
sectors of the market. In the end this study also explains the advantages as well as
disadvantages of different sources of finance available to the company.

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MARKETING AND FINANCE
References
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Frösén, J., Jaakkola, M., Churakova, I. and Tikkanen, H., 2016. Effective forms of market
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