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Mulyanegara, R. C. (2011). The relationship between market orientation, brand

orientation and perceived benefits in the non-profit sector: a customer-perceived
paradigm.

Originally published in Journal of Strategic Marketing, 19(5), 429–441.

Available from: http://dx.doi.org/10.1080/0965254X.2011.565880

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The relationship between market orientation, brand orientation, and
perceived benefits in the non-profit sector: a customer-perceived
paradigm

Dr. Riza Casidy Mulyanegara

Marketing Group, Swinburne University, Lilydale, Australia

50 Melba Avenue Lilydale

Victoria 3140 Australia
[email protected]

The purpose of this paper is to examine the relationship between ‘market orientation’, ‘brand
orientation’, and ‘perceived benefits’ in the non-profit sector from the perspective of the customers.
Data was collected from a number of church organizations in Australia using a self-administered
questionnaire. The tests for construct reliability, validity, and research hypotheses were conducted
using structural equation modeling. Findings reveal that ‘market orientation’ is significantly associated
with both ‘perceived brand orientation’ and ‘perceived benefits’. An alternative model also reveals
significant relationship between ‘brand orientation’ and ‘perceived benefits’ through ‘market
orientation’ as the mediating variable. The study contributes to the body of literature and provides
practical implications for non-profit managers and church leaders alike. An organization that
endeavours to build a strong brand and deliver relevant benefits to its members should ensure that it has
sufficient understanding of its members and utilises the various resources of the organization to deliver
superior values to its existing and prospective members.

Keywords: market orientation; brand orientation; perceived benefits; non-profit; customer

perspective

Introduction

The effects of market orientation and brand orientation on organizational performance

have been well documented in the marketing literature. In the non-profit sector,
market orientation was found to be positively associated with fundraising
performance (Kara, Spillan, & DeShields, 2004), members’ satisfaction (Chan &
Chau, 1998), increased attendance (Voss & Voss, 2000), and growth in resources and
reputation (Padanyi & Gainer, 2004). Brand orientation was also found to be
positively related with organizations’ performance in terms of: (i) an organization’s
ability to achieve its short-term and long-term objectives; and (ii) its ability to serve
stakeholders better than its competitors (Napoli, 2006).

Although the topic of ‘market orientation’ and ‘brand orientation’ has been
extensively discussed in the literature, there are several gaps of research in which the
present study aims to address. First, despite the customer-centred philosophy of
market orientation, studies of market orientation have largely regarded it as an
employee-perceived phenomenon (Gounaris, Stathakopoulos, & Athanassopoulos,
2003). A review of the literature reveals that only ten studies have examined market
orientation from a customer perspective, and only one of these (Voon, 2006) was
conducted in a non-commercial setting. Second, the literature on ‘brand orientation’ is
still at its infancy and therefore little attention has been paid to the specific question of
brand orientation from a customer perspective. Thus, the first objective of this

1
research is to assess the constructs of ‘market orientation’ and ‘brand orientation’ in
the non-profit sector from the perspective of the customers.

The second objective of this research is to examine the relationship between ‘market
orientation’ and ‘brand orientation’. Although few studies (O'Cass & Ngo, 2009;
Tuominen, Laukkanen, & Reijonen, 2009) have been done to examine the relationship
between ‘market orientation’ and ‘brand orientation’, previous research in this area
focuses on managers, brand executives, and employees as the study participants. The
present author argues that customers and employees may have different views in
relation to the constructs of ‘market orientation’ and ‘brand orientation’ and thus the
nature of relationship between the two constructs may differ when examined from the
customer perspective.

Finally, this research aims to examine the effects of ‘market orientation’ and ‘brand
orientation’ on customers’ perceived benefits. Despite the central importance of
‘perceived benefits’ in the marketing literature, few studies have examined its
antecedents in the non-profit sector. It is the interest of the present author to examine
whether positive perception of an organization’s market orientation and brand
orientation will lead to positive evaluation of the benefits associated with the
programme/activities offered by the organization.

The paper is organized as follows: First, the present author reviews a number of
theoretical viewpoints that offer conceptual support for the relationship between
market orientation, brand orientation, and perceived benefits. This is then followed by
the development of hypotheses and a conceptual framework for the study which is
then empirically tested. The results are presented followed by discussion, the
implications of the study and its limitations.

Literature Review

Perceived Market Orientation

When examined from the perspective of the customers, the construct of ‘market
orientation’ has been variously referred to as: (i) ‘perceived market orientation’
(PMO) (Baker, Simpson, & Siguaw, 1999; Corbitt, Thanasankit, & Yi, 2003;
Gounaris, et al., 2003); (ii) ‘customer-defined market orientation’ (CDMO) (Krepapa,
Berthon, Webb, & Pitt, 2003; Webb, Webster, & Krepapa, 2000); and (iii) ‘perceived
customer orientation’ (Dean, 2007). For the purposes of the present study, the term
‘perceived market orientation’ (PMO) is used to refer to customer perceptions of the
extent to which an organization engages in market-oriented activities and behaviour.

In accord with Drucker’s (1954) customer-centered philosophy, proponents of PMO

argue that the level of market orientation of any given organization should always be
assessed from the customer’s perspective. Deshpande et al. (1993, p.27) have
observed that: “ the evaluation of how customer oriented an organization is should
come from its customers rather than merely from the company itself”. Similarly,
Webb et al. (2000, p.102) asserted that: “ the adoption of [an] employee-defined
view of market orientation is one-sided and myopic in that it ignores the vital role of
customers in terms of value recognition”. Steinman et al. (2000, p.110) concurred in

2
contending that: “ the appropriate level of market orientation is what the customer
thinks it should be”.

In their initial study of PMO, Deshpande et al. (1993) found a significant relationship
between business performance and PMO. Steinmann et al. (2000) later used the nine-
item market orientation scale of Deshpande et al. (1993) to examine the gap between
customers’ and suppliers’ perceptions of market orientation. The study found that the
normative gap between customers’ and suppliers’ PMO decreased significantly as the
length and importance of their mutual relationships increased. Krepapa et al. (2003)
subsequently examined the impact of this perceptual gap on satisfaction. Using an
adapted version of Narver and Slater’s (1990) scale, the study found that greater gaps
between customers’ and suppliers’ PMO were associated with lower levels of
customer satisfaction (Krepapa, et al., 2003). These findings lend further support to
the proposition that PMO has a significant influence on organizational performance.

Within the non-profit context, Voon (2006) proposed six elements of the so-called
‘service-driven market orientation’ (SERVMO) construct, which consisted of an
adapted version of Narver and Slater’s (1990) market orientation components. Voon
(2006) found significant relationships between SERVMO and service quality, which
is consistent with other findings in the commercial context (Gounaris, et al., 2003;
Webb, et al., 2000). Despite these recent advances, few studies have examined the
significance of ‘perceived market orientation’ in the non-profit context and thus little
managerial implications have been identified.

Perceived Brand Orientation

Whereas the PMO construct was developed to measure market orientation from a
customer perspective, the construct of ‘brand orientation’ has never been examined
from the perspective of the customers. The term ‘brand’ in the present study refers to
the branding of the organization itself. Corporate branding differs from product
branding in the importance it places on so-called ‘brand values’—that is, the values
that are inherent in, or associated with, the corporation (and its products and services)
(de Chernatony, 1999). A strong corporate brand is often perceived as an assurance of
quality or as a form of insurance against poor performance or financial risk (Balmer &
Gray, 2003). Within the non-profit sector, a strong brand image can (i) enhance an
organization’s ability to communicate its values to stakeholders (Tapp, 1996); (ii)
change public opinion (Lindsay & Murphy, 1996); (iii) build loyalty (Ritchie, Swami,
& Weinberg, 1999); (iv) achieve short-term and long-term objectives (Hankinson,
2002; Simoes & Dibb, 2001); and (v) attract a greater proportion of voluntary income
(Hankinson, 2001). Despite these apparent benefits, brands are still largely under-
utilised as a strategic asset in the non-profit sector. As Stride and Lee (2007, p.114)
observed in a qualitative study of non-profit directors: “ whilst respondents talked
enthusiastically about branding, it was rarely discussed in terms of it being an
important strategic tool in its own right”.

Perceived Benefits

Within the marketing literature, ‘perceived benefits’ is often conceptualized as part of

‘perceived value’, which refers to ‘consumers’ overall assessment of the utility of a
product based on perceptions of what is received and what is given’ (Zeithaml, 1988,

3
p.14). The use of ‘perceived benefits’ as a focal construct in the present study is
consistent with Buckmaster’s (1999) proposition, which suggests that the performance
of non-profit organizations can be defined in terms of the benefits generated in favour
of the individuals participating in the organization’s programs. It is also consistent
with the consumer perspective paradigm proposed by Priem (2007), which
emphasizes on maximizing customers’ perceived benefits as the means to attain
competitive advantage.

With church organizations as the research context, the construct of ‘perceived

benefits’ in the present study refers to customers/members’ perception of ‘what is
received’ from participating in the programs/activities offered by a church
organization. Following a thorough review of literature on church participation, the
present author incorporated spiritual and social benefits in developing the ‘perceived
benefits’ construct in the present study. On the basis of intrinsic and extrinsic
religiosity concept (Allport & Ross, 1967), it can be argued that intrinsically oriented
individuals are motivated to attend church to strengthen and express their religious
faith (spiritual motives), whereas extrinsically oriented individuals are motivated to
attend church to satisfy their need to belong (social motives). The conceptualisation of
spiritual and social benefits as antecedents of church participation is also consistent
with the theory of search for meaning and belonging (Furseth & Repstad, 2006;
McGuire, 1997) and the findings of Siegel & Scrimshaw (2002) which asserted that
people engage in religious activities to gain spiritual support through a personal
relationship with God as well as social support gained through their interactions with
other members/attendees (social benefits).

Conceptual Framework

Insert Figure 1 about here

Overview of the framework

Figure 1 presents the conceptual framework of the present study. Consistent with the
objective of this research, the construct of ‘perceived market orientation’ (PMO) was
hypothesized as performing positive effects on ‘perceived brand orientation’ (PBO).
Both constructs were also hypothesized to perform positive effects on ‘perceived
benefits’. The rationale behind the framework is discussed in the following section.

Perceived Market Orientation and Perceived Brand Orientation

The link between ‘market orientation’ and ‘brand orientation’ was initially proposed
by the first proponent of brand orientation. Urde (1999) asserted that brand orientation
provides the basis of an organization’s interaction with customers and therefore
should be built on the foundation of market orientation. Noble, Sinha, & Kumar
(2002, p.28) suggested that ‘the necessary understanding of customers, competitors,
and organizational processes associated with successful branding suggests a tie to the
market orientation’. Further to these propositions, Reid et al. (2005) proposed a
conceptual model of the relationships between ‘market orientation’ and ‘brand

4
orientation’, arguing that higher levels of market orientation are associated with
higher levels of brand orientation.

More recently, marketing researchers have attempted to provide empirical evidence

on the relationship between ‘market orientation’ and ‘brand orientation’, Using the
MARKOR scale of Kohli and Jaworski (1990), O’Cass & Ngo (2009) found that
market orientation is positively related to brand orientation (β=0.66, p<.05).
Similarly, Tuominen et al (2009) found positive association between the two
constructs using the MKTOR scale of Narver and Slater (1990). The researchers
found that ‘customer orientation’ has the strongest effects on brand orientation
(β=0.41, p<.05), followed by ‘interfunctional coordination’ (β=0.28, p<.05)
(Tuominen, et al, 2009).

On the basis of previous studies on the link between ‘market orientation’ and ‘brand
orientation’, this research hypothesizes that customers’ perception of an
organization’s market orientation (PMO) is positively associated with their perception
of the organization’s brand orientation (PBO). As asserted by Urde (1999), market
orientation and brand orientation are linked together through their central focus on
customers. Highly market-oriented organizations constantly monitor the needs of their
members and deliver relevant programs/activities that address those needs. Members
who have positive perception of the organization’s performance in the various
dimensions of ‘market orientation’ is thus likely to perceive the organization as
unique, reputable, and consistent in delivering its message (all of which are the
dimensions of ‘perceived brand orientation’ construct in the present study). The
following hypothesis is thus proposed:

H1: Perceived market orientation is positively related to perceived brand orientation

Perceived Market Orientation and Perceived Benefits

The fundamental objective of market orientation is to create superior value for the
customers (Narver & Slater, 1990). In this regard, the paradigm of ‘service-dominant
logic’ (Vargo & Lusch, 2004) postulates that the customer is always a co-creator of
value—that is, marketers can only offer value propositions, but the real value of
products/services is determined by consumers on the basis of ‘value in use’. As
previously mentioned, highly market-oriented organizations design their services
based on the needs of existing and prospective members. Consequently, members that
have positive evaluation of an organization’s market orientation are also likely to
perceive relevant benefits from participating in the programs/activities offered by the
organization. This is because the members believe that the programs/activities offered
by the organization are designed with the needs of its members in mind.

H2: Perceived market orientation is positively related to perceived benefits

Perceived Brand Orientation and Perceived Benefits

Brand orientation is defined as ‘the approach in which the processes of an

organization revolve around the creation, development, and protection of brand
identity in an ongoing interaction with customers with the aim of achieving lasting
competitive advantages in the form of brands’ (Urde, 1999, p.117). The ‘perceived

5
brand orientation’ construct in the present study was designed to examine
customers/members’ perceptions of the extent to which an organization engages in
brand-oriented activities and behaviour. Consistent with the definition of brand
orientation, the present author hypothesizes that members that have positive
evaluation of an organization’s brand orientation is also likely to perceive relevant
benefits from participating in the programs/activities offered by the organization. This
is because the members believe that the organization’s brand identity is built around
ongoing interaction with the members, and thus the activities/programs offered by the
organization are designed with the needs of its members in mind.

H3: Perceived brand orientation is positively related to perceived benefits

Methodology

Sample Description

In this research, the sampling frame consists of members of church organizations in

Australia. Over the past two decades, churches have been increasingly utilised as a
research context in studies of the non-profit sector (Abreu, 2006; Santos & Mathews,
2001; Sargeant, 2005) and services marketing (Rodrigue, 2002; Sherman & Devlin,
2000; Webb, Joseph, Schimmel, & Moberg, 1998). The resemblance between the role
of ‘church members’ in church organizations and ‘customers’ in commercial
organizations has also been supported in the literature, mainly due to church
members’ extent of involvement in the production, delivery, and consumption of
services experience which mirrors customers’ involvement in the service retailing
context (Attaway, Boles, & Singley, 1996; Mehta & Mehta, 1995; Saunders, 2000).
1085 questionnaires were distributed in thirteen church organizations that participated
in the study. The number of attendees slightly varies between churches with an
average of 100 adult attendees in every service. A total of 344 usable questionnaires
were received, indicating a response rate of over 31%.

Measures

Perceived Market Orientation

This study adapted Narver and Slater’s (1990) MKTOR scale to measure respondents’
perception of an organization’s performance in the respective dimensions of market
orientation (customer orientation, competitor orientation, and interfunctional
coordination). The scales were adapted to reflect the non-profit environment under
consideration. Since this research focuses on the examination of market orientation
from the customers’ (members) perspective, the wording was also modified to reflect
customers’ perceptions. The modification procedure in this study followed closely the
recommendations of previous scholars on the application of a market orientation scale
in non-profit settings (Gainer & Padanyi, 2005; Padanyi & Gainer, 2004; Wood,
Bhuian, & Kiecker, 2000).

Perceived Brand Orientation

The present author initially attempted to adapt the Non-profit Brand Orientation
(NBO) measure (Ewing & Napoli, 2005) in developing the ‘perceived brand
orientation’ (PBO) construct in this study. However, the adaptation of NBO construct

6
in the customer context is a rather complex issue because the assessment of the
importance of branding in an organization’s strategy is typically assessed by top
managers (Urde, 1999). A pilot study involving members of a particular church
organization reveals that a number of statements in the NBO construct were not
applicable to customers/members as these are not experience-related but rather a
strategic issue.

Following the complexities involved in the adaptation of the brand orientation scale,
the present author referred to the brand orientation themes (uniqueness, reputation,
and orchestration (Aaker, 1991; de Chernatony & Riley, 1998; Keller 2000) used by
Ewing and Napoli (2005) in their development of NBO. Akin to the scale
development process for PMO, the development process for the PBO instrument
involves consultation with experts in the area and in-depth interview participants.

Perceived Benefits
This research utilized Emmons et al. (1998) instruments of personal goals, which
have been extensively used in literature pertaining to the psychology of religion (Hill
& Hood, 1999; Zinnbauer, Pargament, & Scott, 1999), to measure ‘spiritual’ and
‘social’ benefits. The scales were designed to examine the extent to which
respondents believe that the programs/activities offered by the church can help them
to achieve certain spiritual and social outcomes in life.

Results

Exploratory Factor Analysis

Exploratory factor analysis was performed with principal axis factoring (common
factor) as a method of extraction. This research also used Varimax rotation method
which minimizes the number of variables with high loadings on one factor (Malhotra,
Hall, Shaw, & Oppenheim, 2002). The number of factors in this study was determined
by eigenvalue which reflects the amount of variance associated with a particular
factor. For the purpose of this study, only factors with variances greater than 1.0 were
retained.

The EFA results indicated that the PMO construct in this research is consistent with
Narver and Slater’s (1990) dimensions of market orientation with three distinct
components of ‘customer orientation’, ‘competitor orientation’, and ‘interfunctional
coordination’. Although the PBO items were originally developed to reflect three
brand orientation themes, the EFA extracted one factor out of eight variables. The
unidimensional nature of the PBO scale in the present study is consistent with
Hankinson’s (2001b) studies of brand orientation in the non-profit sector.

Confirmatory Factor Analysis

CFA procedure was implemented to further refine the constructs, and to assess the
convergent and discriminant validity of the constructs. As depicted in table 1, the
standardized factor loading coefficients of most constructs are above the ideal level of
0.7, thus reflecting convergent validity.

7
Appendix 1 shows means, standard deviations, and intercorrelations of all of the
measurement variables. As depicted in the table, the AVE for each construct is greater
than all related correlation, thus indicating discriminant validity (Fornell & Larcker,
1981). The final measurement model demonstrated good fit with the data as reflected
in the fit indices including χ² (59) = 121.536 (p = .000), NC (2.060), RMSEA (.056),
TLI (.960), CFI (.970), and NFI (.943).

Reliability

This study took into account the Cronbach’s Alpha of each construct as displayed in
table 1 along with the description of the final items. The coefficient alphas for the
respective constructs were calculated using the reliability procedure in SPSS. As can
be seen in the table, the reliabilities of all constructs in this research fall within the
excellent level (0.7 and above) (Cronbach, 1951).

Insert figure 2 about here

Tests of Hypotheses

The structural model in figure 2 was employed to test the research hypotheses. An
examination of the fit indices suggested that the model had acceptable fit with the
data. The fit indices such as NC (2.168), RMSEA (.058), GFI (.958), AGFI (.932),
TLI (.960), NFI (.934), and CFI (.963) are within the recommended level.

An examination of the standardised regression weights and Critical Ratio indicates

that PMO is positively associated with PBO (β = .768, p < .001), thus lending support
to H1. The results also lend support to H2, as PMO was found to perform significant
direct effects (β = .452, p < .001) on ‘perceived benefits’. The analysis also assessed
for potential indirect effects of PMO on ‘perceived benefits’ through PBO. The
bootstrapping method was used to estimate the standard error, but no significant
indirect effects were found between PMO and ‘perceived benefits’.

The structural model reveals that the direct effects of PBO on ‘perceived benefits’ is
non-significant (β = .153, p >.05), thereby failing to confirm H3. An alternative model
was then employed to test the potential effects of PBO on ‘perceived benefits’
through PMO as the mediating variable. This was done by reversing the direction of
relationship between PMO and PBO. The analysis of the regression weight tables
reveal that PBO has significant indirect effects (β = .347, p < .05) and total effects (β
= .500, p < .001) on ‘perceived benefits’ through PMO. Thus, although no significant
direct effects were found to confirm H3, the significant indirect effects revealed in the
alternative model suggests that the relationship between PBO and ‘perceived benefits’
is only significant through PMO as the mediating variable.

Discussions

The purpose of the present study was to examine the relationship between ‘perceived
market orientation’, ‘perceived brand orientation’, and ‘perceived benefits’ in the non-

8
profit sector. Drawing on the existing literature, this research proposed a conceptual
framework linking the three constructs and tested the hypothesized relationships
through the use of structural equation modeling.

The results of the analysis reveal interesting findings for marketing researchers and
practitioners alike. First, it was found that respondents’ perception of an
organization’s market orientation is positively related to their perception of the
organization’s brand orientation. The results provide empirical verification for the
conceptual work of Reid, et al (2005) and complement the findings of previous
researchers in this area (O'Cass & Ngo, 2009; Tuominen, et al., 2009). In relation to
the previous studies, it worth noting that the association between PMO and PBO in
this study (β=0.768, p<.001) is stronger than the one found in O’Cass and Ngo (2009)
studies (β=0.66, p<.05). This might be attributed to the differences in the unit of
analysis, as the present study involved customers/members of non-profit organizations
as the study participants whereas O’Cass and Ngo involved brand executives and
managers. Second, it was found that respondents’ perception of an organization’s
market orientation is positively related to ‘perceived benefits’. This suggests that the
more people perceive an organization to be market-oriented, the more they associate
relevant benefits with participating in the programs/activities offered by the
organization. Finally, an observation of the alternative model found that the
relationship between ‘perceived brand orientation’ on ‘perceived benefits’ is only
significant through the mediating role of ‘perceived market orientation’. This suggests
that respondents’ perception of an organization’s brand orientation alone does not
lead to positive perceived benefits. Rather, it is only through ‘perceived market
orientation’ that respondents eventually ‘transform’ their evaluation of an
organization’s brand orientation to positive perception of the benefits associated with
the organization’s programs/activities.

The contribution of the present study to the literature is twofold. First, the study
contributes to the body of literature through an empirical examination of the
relationship between customer-perceived market orientation (PMO), brand orientation
(PBO) and ‘perceived benefits’. Future researchers can examine the predictive power
of PMO and PBO on other indicators of organizational performance both in the
commercial (financial performance, customer satisfaction and retention) and the non-
profit sector (resource attraction and allocation). Second, the study contributes to the
branding literature through the development of ‘perceived brand orientation’
constructs which measure how brand-oriented an organization is from the perspective
of the customers. Although the PBO scale in the present study was developed for the
non-profit sector, there is a future research avenue to develop similar construct in the
commercial sector. The applicability of the PBO construct of the present study in
other non-profit sectors (e.g. charitable organizations) will also be of significant
interest for non-profit researchers and practitioners alike.

This study has provided useful insights for non-profit organizations’ managers in
general and church leaders in particular. With the significant decline in church
attendance over the past two decades (NCLS, 2001), the findings of the present study
could assist church leaders in developing a strong brand and enhance members’
perceived benefits, which could eventually lead to more active church participation.
An organization that endeavours to build a strong brand should ensure that it has
sufficient understanding of customers/members and utilizes the various resources of

9
the organization to deliver superior values. Non-profit managers and church leaders
alike should constantly monitor customers/members’ perception of the organization’s
performance in the respective dimensions of market orientation. Second, particular
attention should be given to the three themes of ‘brand orientation’ in creating a
strong brand. On a more practical note, this approach includes creating a unique brand
identity as a means for differentiation (uniqueness), monitor the organization’s
reputation as perceived by its existing and prospective members (reputation), and
deliver consistent messages about the organization’s image to the surrounding
community (orchestration).

Two main limitations of the study are identified. First, the use of convenience
sampling to recruit the respondents possesses some weaknesses. With church
attendees as the unit of analysis, the respondents may feel ‘obliged’ to evaluate their
church positively. Although the respondents were informed that the survey is
anonymous in nature, they were notified that a summary of the study findings would
be reported to the church leaders for evaluation purposes. Hence, respondents’
evaluation of the church’s image and market orientation may be biased towards giving
socially desirable responses. Second, although the church represents an ideal context
within which to examine the construct of PBO and PMO due to the active
participation of the members, there may be other factors (such as faith and
spirituality) which affect respondents’ positive evaluation of the church’s market
orientation, brand orientation, and perceived benefits. Thus, as previously mentioned,
the replication of the present study in other non-profit sectors is an attractive avenue
for future research.

In conclusion, the present study has provided useful insights into the relationship
between market orientation, brand orientation, and perceived benefits from the
customers’ perspective. It is expected that the study will be a catalyst to draw further
attention on research in this important topic.

Table 1. Standardized Factor Loadings, t-Value, and Cronbach’s Alpha of final items
Standardized Factor t-
Measurement items (Cronbach's Alpha) Loadings Value
Customer orientation (0.89)
Constant monitoring of members' needs 0.804 21.608
Services designed based on members' needs 0.848 22.932
The leaders constantly seek to understand members'
expectations 0.918 25.068

Competitor orientation (0.86)

The organization reacts to better other organizations’
practice 0.841 20.709
The leaders are aware of other organizations' practice 0.873 21.263
The organization focuses on particular communities
where it can serve better 0.749 19.021

10
Interfunctional coordination (0.88)
Encouragement for members to be involved in the
organization 0.753 18.612
The leaders understand how different activities/events
can provide great value 0.902 21.714
The different departments within the organization
shares their resources with each other 0.86 20.859

PBO (0.85)
People come to the organization because of its
reputation (reputation) 0.471 11.367
The organization possess unique values which are
transparent to the community (uniqueness) 0.631 16.227
Well known in the surrounding community (reputation) 0.613 15.623
Communication sends consistent messages about the
organization to the community (orchestration) 0.855 24.844
The activities/programs implemented by the
organization has strong appeals to the local community
(orchestration) 0.864 25.105
Promotional materials create an image that is well
understood by the members (orchestration) 0.807 22.887

Spiritual benefits (0.92)

Develop spiritual meaning in life 0.905 42.114
Bring my life in line with my beliefs 0.965 55.777
Deepen my spirituality 0.952 52.711

Social benefits (0.90)

Meet new people through my present friends 0.881 34.085
Develop good social relationships 0.912 37.473
Build network of friends 0.937 40.303
Figure 1. Conceptual Framework

Customer

Competitor
PMO
H2
Interfunctional Spiritual
Perceived
H1
Benefits Social

H3
PBO

11
Figure 2. Structural Model

Customer

Competitor PMO

Interfunctional .45**
PB SPI
Perceived
.77**
Benefits PB SOC
VARBR3 .15ns

VARBR2

PBO
VARBR4

VARBR6

VARBR7

VARBR8

**significant at 1%. All results standardized

Acknowledgements
The author would like to thank Dr. Eleri Rosier and the anonymous reviewer for forwarding the paper
to the special issue of the Journal of Strategic Marketing. Special thanks to Dr. Yelena Tsarenko and
Professor Felix Mavondo who have been an integral part of the research project.

Dr. Riza Mulyanegara is a lecturer in marketing at Swinburne University of Technology, Australia. He

has presented and published his work in international marketing conferences and journals, including
the Journal of Brand Management and Journal of Fashion Marketing and Management.

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 Appendix 1. Means, standard deviations, and correlation matrix

Standard Customer Competitor Interfunctional Spiritual Social

Construct Mean Deviation Orientation Orientation Coordination PBO benefits benefits
Customer Orientation 5.196 1.139 0.76
Competitor Orientation 3.205 1.48 .231** 0.80
Interfunctional Coordination 5.593 1.057 .515** .118* 0.71
PBO 5.138 1.062 .505** .236** .524** 0.71
Spiritual benefits 5.892 1.104 .231** -0.011 .260** .238** 0.89
Social benefits 5.347 1.363 .284** .131* .269** .329** .399** 0.87
** significant at 1% level. Numbers shown in italics denote the average variance extracted
* significant at 5% level

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