Antecedent Factor Model of Entrepreneurial Orientation in Improving

Marketing Performance through Product Innovation and

Value Co-Creation

LUTFI LUTFI, HAYATI NUPUS*

Department of Management,

Sultan Ageng Tirtayasa University,

Jalan Raya Palka KM.3 Sidang Sari, Serang, Banten,

performance level of MSMEs of culinary products in Banten. The SEM method uses a SmartPLS v. 3.0

application software to conduct analysis. The population is MSMEs culinary business actors in the area of

Banten Province. The probability/random sampling technique will be applied with the cluster method, and the

number to be analyzed is 90 respondents. The results showed that marketing orientation directly and

significantly affects marketing performance. Furthermore, marketing orientation does not significantly impact

marketing performance through product innovation. It significantly influences marketing performance on the

alpha level of 10% through value co-creation and product innovation. Therefore, value co-creation has a crucial

role in the relationship among variables in this research.

competition. MSMEs have weaknesses as a family-

owned businesses conducted using simple

technology due to limited access to capital, [1]. The

article [2] stated the best way to improve MSME

performance is by enhancing three main

dimensions of entrepreneurial orientation, namely

innovative, proactive, and brave for risk-taking.

because the culinary business is considered

adequately promising. Furthermore, food is a daily

innovative is an attitude of an entrepreneur to get

involved in the trial process of creating services or

goods, [4].

enhance marketing effectiveness, [5]. The

GRDP (Gross Regional Domestic Product). It was

also analyzed as the cause of the instability of the

marketing performance of each culinary MSMEs,

[6]. Furthermore, the study in [6] emphasized that

this phenomenon agrees with the market condition

that experiences changes and the dynamic affects

the customer's taste and preferences. It requires

innovation that can complement and develop a

product to keep life sustainability and the

company's profit. According to [7], product

where product innovation has not been able to

encourage marketing performance improvement.

The article in, [8] stated that effectiveness is not

much impacted by product placement, and

according to, [9] innovation has a positive effect

and improves marketing performance in the long

term. Therefore, researchers are interested in

placing sentrepreneurial orientation variables as

triggers to stimulate innovation and value co-

creation to improve marketing performance. Based

variable through value co-creation and product

innovation in enhancing the effectiveness of

MSMEs in the sector of local culinary specialties in

Banten.

academics in enriching their knowledge to develop

product innovation, value co-creation, and

entrepreneurial orientation to participate in the

intense business competition. The government also

needs to notify the MSMEs industry and provide

customers [18,19]. The actors and the receivers

conduct this activity in a mutually integrated

network with the means of a takeover source for a

win-win solution [20, 18,19]. According to the

support activities improved by the belief to gain

benefits in attracting value co-creation activity.

Furthermore, the authors in [22] stated that

customers are active players in value co-creation,

and further study is needed to identify important

factors behind the development of behavior

Performance reflects the success rate of an effort

performed by an individual, a group, an

organization, or a company. It was described by,

[23] as the result of the actions taken by the owner

According to [36], value co-creation is based on the

company's and consumers' viewpoints, and both

parties provide resources through design co-

mechanism, co-development, or co-distribution.

Research performed by, [37], [38], [39] found that

This study examines the link between

entrepreneurial orientation as the independent

variable, product innovation and value co-creation

as the intervening factors, and marketing

performance as the dependent variable. This

research's characteristic is causality, which seeks an

explanation in the form of a cause-effect

relationship among several concepts or variables,

[45].

exogenous variables endogenous value. This model

can then be assessed by observing R-square at each

endogenous latent variable. In this research, there

are three variables influenced by the exogenous,

marketing performance as seen below.

product innovation, marketing performance, and

respectively. The above assessment proves that this

research model has met the requirements and the

variation of marketing performance is 81,1%. The

remaining 18,9% is affected by other external

variables.

out the impact of independent variables on

dependent partially in a structural or regression

model. The result of the hypothesis assessment can

be seen in Table 4.

orientation positively impacts marketing

marketing performance.

product innovation, shown by the parameter

coefficient of 0.833. Based on the data processing

(path coefficient), the T-statistic value for the

impact of business orientation on innovative

products obtained 24.541, bigger than the T-table

of 5% (1.96) alpha, whose P-value is 0.000, smaller

than 0.05. Therefore, hypothesis 2 (H2) is accepted:

Product innovation is positively and significantly

Table 1. Average Variance Extracted (AVE) of Measurement Model

Table 2. Discriminant Validity Value of Measurement Model

Table 5. Indirect Effect Value of Measurement Model

According to the data processing result, as seen

in Table 5, four relationships indirectly affect the

variables in this model.

orientation effect on marketing performance

through product innovation, which does not

The result is value co-creation mediates product

innovation's effect on marketing performance. This

can be shown by the T-statistic result of 2.002,

smaller than the T-table of 5% (1.96) alpha, whose

P-value is 0.048, smaller than 0.05. Test of

Mediation 3 is the entrepreneurial orientation effect

on marketing performance through product

innovation and value co-creation. These variables

5 Result and Discussion

marketing performance. It implies that the

entrepreneurial orientation of the Banten culinary

performance. This result is under the hypothesis

proposed and supports the previous research

performance. Based on the answer to the open

question in the variable, improving marketing

performance can be conducted by always keeping

the tendency to act autonomously, having a desire

for innovation, and taking risks.

be conducted by always keeping the tendency to act

autonomously, having a desire for innovation, and

taking risks.

performance. Specifically for Banten culinary

specialties MSMEs, the design, product variation,

and quality did not affect the marketing

performance. This can happen because the actors

do not have specialties from their region's culture,

taste, or market area. Consequently, there is no

frontal competition, and there is the existence of a

"business lot" and decrease in quality.

and is also against the previous research performed

directly improved by entrepreneurial orientation

without this variable. Mediation 2 is product

innovation's effect on marketing performance

with the customers, involving in development, and

keeping the correlation between consumers and

producers to improve the marketing performance of