Architectural Marketing Capabilities as a Catalyst for Enhancing Entrepreneurial Orientation

Architectural Marketing Capabilities as a Catalyst for Enhancing Entrepreneurial Orientation

Ezenne Chinenye Christiana^*, Gazi Md Nurul Islam

Tun Razak Graduate School, University Tun Abdul Razak,195A, Jalan Tun Razak, Hampshire Park, 50450, Kuala Lumpur, Malaysia.

^*Corresponding author

DOI: https://dx.doi.org/10.47772/IJRISS.2025.905000145

Received: 29 April 2025; Accepted: 04 May 2025; Published: 04 June 2025

ABSTRACT

This proposed study seeks to explore the role of architectural marketing capabilities (AMC) in enhancing the relationship between Entrepreneurial Orientation (EO) dimensions and the performance of Small and Medium Enterprises (SMEs) in Nigeria. SMEs play a critical role in Nigeria’s economy, contributing significantly to GDP and employment. However, despite their critical role, many Nigerian SMEs face persistent challenges in achieving sustainable performance. While EO has been recognized as a key factor driving SME success, its relationship with performance outcomes is often inconsistent. This study introduces architectural marketing capabilities as a key mediating factor that potentially bridges EO dimensions and SME performance. This study aims to fill the gap by examining how AMC can mediate the impact of EO on SME performance underpinning the Resource-Based View (RBV) and Innovation Theory. Marketing capabilities is not merely integrated as supportive tools but as strategic assets that reshape entrepreneurial efforts into tangible performance. A quantitative research design will be employed, using a structured questionnaires to collect data from SME owners and managers across different sectors in Nigeria. The study proposes the use of Structural Equation Model (SEM) to test hypothesized relationships and explore both direct and indirect effects. By examining the mediating role of architectural marketing capabilities, this research seeks to contribute to the theoretical advancement of entrepreneurship and marketing capabilities literature, particularly in the context of developing economies. Furthermore, practical implications will be drawn for SME practitioners and policymakers aiming to enhance firm competitiveness through strategic capability development. The study’s findings are expected to offer valuable insights into how Nigerian SMEs can better align their entrepreneurial strategies with robust marketing architectures to achieve sustainable growth and performance.

Keywords: Entrepreneurial Orientation, Architectural Marketing Capabilities, SME Performance, Nigeria, Mediation Analysis

INTRODUCTION

Small and Medium Enterprises (SMEs) are crucial drivers of economic growth, innovation, and employment, particularly in emerging economies like Nigeria. SMEs contribute nearly 46.2% to Nigeria’s Gross Domestic Product (GDP) and account for about 87.9% of the workforce and 6.2.1% of exports of the country (PWC, 2024). These enterprises play a vital role in reducing unemployment rates and fostering economic diversification. However, despite their significant contributions, Nigerian SMEs face a range of challenges that hinder their growth and overall performance. These challenges include limited access to finance, inadequate infrastructure, market volatility, and an unstable policy environment (Oluremi & Maku, 2024).

While external factors, such as financial constraints and market instability, have been widely studied, the internal capabilities that influence SME success, particularly Entrepreneurial Orientation (EO) and Architectural Marketing Capabilities (AMC), remain underexplored. EO, which includes dimensions such as innovativeness, risk-taking, proactiveness, autonomy, and competitive aggressiveness, has long been recognized as a critical determinant of SME success (Lumpkin & Dess, 1996). Research indicates that firms with a strong EO are better positioned to navigate market uncertainties, capitalize on new opportunities, and innovate to maintain a competitive edge (Nasir et al., 2017). However, the relationship between EO and SME performance is not always clear, with some studies reporting inconsistent or mixed results (Gupta et al., 2019). These inconsistencies suggest that other internal capabilities may mediate or enhance the EO-performance relationship.

One such underexplored factor is Architectural Marketing Capabilities. AMC refers to the ability of a firm to align its marketing strategies with the specific needs of its target markets, ensuring that entrepreneurial initiatives are effectively implemented to yield tangible outcomes (Hoque et al., 2021). AMC is particularly important for SMEs in Nigeria, where market conditions are volatile, and businesses face intense competition. While previous studies have recognized the role of marketing capabilities in driving firm performance (Shaher & Ali, 2020), empirical research on AMC’s mediating role in the EO-performance relationship, particularly in Nigerian SMEs, is scarce.

This paper seeks to fill this gap by proposing the role of AMC as a mediator between EO dimensions and SME performance in Nigeria. Specifically, the research focuses on investigating whether AMC can enhance the impact of EO on key performance outcomes such as profitability, market share, and sustainability. This paper builds on the Resource-Based View (RBV) and Innovation Theory to explain how Entrepreneurial Orientation (EO) influences SME performance, with AMC acting as a mediating factor. By proposing a conceptual framework, this study will answer the question of whether strong marketing capabilities can help SMEs translate their entrepreneurial strategies into improved profitability, market share, and long-term sustainability. This paper seeks to advance theoretical understanding of EO and AMC while offering practical insights. Theoretically, this research will extend to the existing knowledge by integrating EO and AMC in the context of Nigerian SMEs, an area that has been underexplored.

Research Objectives

1. To examine the influence of architectural marketing capabilities on SME performance.
2. To identify which specific AMC components most strongly relate to EO dimensions.
3. To provide recommendations for SMEs seeking to enhance EO through marketing infrastructure.
4. To assess the mediating effect of Architectural Marketing Capabilities on the relationship between Entrepreneurial Orientation dimensions and SME performance

LITERATURE REVIEW

Entrepreneurial Orientation and Sme Performance

Entrepreneurial Orientation (EO) refers to the strategic posture of a firm, encompassing key dimensions such as innovativeness, risk-taking, proactiveness, autonomy, and competitive aggressiveness (Lumpkin & Dess, 1996). EO is widely recognized as a critical driver of SME performance, influencing firms’ ability to adapt to market dynamics, innovate, and maintain competitiveness (Dangana, 2022). The relationship between EO and SME performance has been extensively studied, with a consensus that higher levels of EO lead to superior performance outcomes (Abdelgadir et al., 2020). Firms with a strong EO are more likely to take calculated risks, exploit emerging opportunities, and develop unique products or services, thus fostering sustainable growth (Kohtamäki et al., 2019).

However, the impact of EO on SME performance is not always straightforward. Several studies have reported mixed results, suggesting that the relationship between EO and performance may be contingent on contextual and mediating factors (Gupta et al., 2019; Onwe et al., 2020). For instance, while EO may drive innovation and market responsiveness, it does not necessarily guarantee financial success or operational efficiency if other internal capabilities are lacking (Zehir et al., 2016). This indicates that EO alone may not be sufficient for superior performance, especially in volatile and resource-constrained environments like Nigeria.

One crucial factor that can mediate the relationship between EO and performance is the firm’s internal marketing capabilities, particularly AMC. Despite the recognition of EO’s role in enhancing performance, there has been limited exploration into how marketing capabilities can influence this relationship. The synergy between EO and AMC could offer a more comprehensive understanding of how SMEs can translate entrepreneurial strategies into actual business outcomes, particularly in emerging markets.

Dimensions Of Entrepreneurial Orientation

The five key dimensions of EO—innovativeness, risk-taking, proactiveness, autonomy, and competitive aggressiveness—are interrelated and collectively shape an SME’s ability to compete in dynamic environments. Each dimension has distinct implications for performance and plays a role in how firms respond to market changes.

Innovativeness refers to a firm’s capacity to develop new products, services, or processes that create value in the market (Iqbal et al., 2021). For SMEs, innovation is crucial for differentiation and long-term sustainability, enabling them to meet emerging customer needs and stay ahead of competitors (Shaher & Ali, 2020; Iqbal et al., 2021). Firms that prioritize innovation are better equipped to capitalize on new market opportunities, thus improving their market positioning (Nasir et al., 2017). However, innovation alone is not sufficient; it must be complemented by other capabilities, such as effective marketing, to ensure that new offerings are successfully commercialized.

Risk-taking involves the willingness to pursue ventures that involve uncertainty or potential loss (Diaz and Sensini, 2020). SMEs with a high-risk tolerance are more likely to explore untested markets or adopt new technologies, which can lead to competitive advantage (Nasir et al., 2017). However, excessive risk-taking without adequate strategic alignment can also lead to adverse outcomes, such as financial instability or resource depletion (Zehir et al., 2016). Therefore, the ability to manage risks effectively is crucial, especially in unstable markets like Nigeria, where external factors like political instability and infrastructural challenges pose significant risks.

Proactiveness refers to the firm’s ability to anticipate and act on future market trends and customer needs (Astrini et al., 2020). Proactive firms are often market leaders, shaping industry trends rather than merely reacting to them (Khizar et al., 2024). In the context of Nigerian SMEs, proactiveness allows firms to better navigate market uncertainties and seize growth opportunities before competitors. However, proactive strategies must be supported by strong marketing capabilities to ensure that new initiatives align with customer preferences and market conditions (Hanaysha and Al-Shaikh, 2022).

Autonomy is the degree to which an SME can make independent decisions without being constrained by rigid structures or external controls (Diaz and Sensini, 2020). Autonomy fosters a culture of innovation and agility, allowing SMEs to adapt quickly to changing market conditions (Shaher & Ali, 2020). This dimension is particularly important for SMEs, as it enables them to execute entrepreneurial strategies without bureaucratic delays. Autonomy can also empower employees to take ownership of projects, leading to enhanced creativity and higher performance (Perera & Samarakoon, 2021).

Competitive aggressiveness refers to a firm’s inclination to challenge competitors directly to improve its market position. Highly aggressive firms actively pursue opportunities to overcome rivals, often through aggressive pricing strategies or superior product offerings (Weinzimmer et al., 2023). In emerging economies like Nigeria, where competition is often fierce, competitive aggressiveness can provide firms with a significant advantage. However, it is important for SMEs to strike a balance, as overly aggressive tactics may lead to market destabilization or resource depletion (Perera & Samarakoon, 2021).

While each dimension contributes to an SME’s strategic approach, their collective impact on performance is contingent on the firm’s ability to effectively integrate these dimensions into a coherent strategy. The interplay between these dimensions can be further optimized by leveraging complementary capabilities such as marketing. Therefore, understanding how EO dimensions interact with other internal resources, such as AMC, is crucial for gaining a deeper understanding of SME performance in emerging markets.

The Mediating Role of AMC in Eo-Sme Performance Relationship

The mediating role of AMC in the relationship between EO and SME performance has become an area of growing interest. While the direct impact of EO on SME performance has been well-established, the role of internal capabilities such as AMC in mediating this relationship has received less attention. AMC refers to a firm’s ability to align its marketing strategies with market demands, customer preferences, and competitive dynamics, ensuring that entrepreneurial initiatives are effectively executed in the marketplace (Hoque et al., 2021). In this context, AMC is not only essential for implementing innovation and differentiation strategies but also for translating the strategic intent behind EO into tangible performance outcomes.

Research suggests that EO provides the strategic foundation for firms to take risks, innovate, and act proactively in the market. However, without strong marketing capabilities, these entrepreneurial activities may not reach their full potential, especially in resource-constrained environments like Nigeria (Pratono & Mahmood, 2015). AMC bridges this gap by enabling firms to effectively execute market-driven strategies that are responsive to consumer needs and competitive pressures. For example, firms with robust AMC can engage in better market segmentation, brand positioning, and customer relationship management, all of which contribute to higher performance (Vincent & Shin, 2015).

Empirical studies have shown that AMC mediates the relationship between EO and firm performance by enhancing the firm’s ability to capitalize on entrepreneurial initiatives. In contexts similar to Nigeria, where market conditions are volatile and resources are scarce, AMC has been found to be a critical enabler of competitive advantage (Mulyana et al., 2021). However, studies focusing specifically on the Nigerian context are limited, creating a significant gap in the literature. Given the unique challenges faced by Nigerian SMEs, such as infrastructural deficiencies and unstable economic conditions (Oluremi & Maku, 2024), the mediating role of AMC warrants further exploration.

AMC’s influence on EO-performance relationship is especially crucial for SMEs that operate with limited resources. In such environments, marketing capabilities become a strategic resource that SMEs can continuously refine and develop, unlike financial capital, which may be subject to external constraints (Lekmat et al., 2018). Therefore, by enhancing marketing capabilities, SMEs can maximize the value derived from their entrepreneurial strategies, resulting in improved market share, profitability, and sustainability (Quaye & Mensah, 2019). This highlights the importance of investigating AMC as a mediator in the EO-performance relationship, especially in emerging economies like Nigeria, where SMEs are pivotal to economic growth.

Theoretical Review and Conceptual Framework

This study integrates key theoretical perspectives to develop a conceptual framework for understanding how EO and AMC influence SME performance. Drawing from the Resource-Based View (RBV) and Innovation Theory, this study posits that both EO and AMC serve as critical resources that enable SMEs to achieve competitive advantage and superior performance in dynamic and uncertain market environments.

RBV emphasizes the importance of internal resources and capabilities in achieving sustainable competitive advantage (Barney, 1991). In this framework, EO is conceptualized as an entrepreneurial resource that drives a firm’s strategic actions, while AMC represents the marketing capability necessary to execute these actions effectively (Vorhies & Morgan, 2005). Firms with strong EO but weak AMC may struggle to capitalize on their entrepreneurial initiatives, leading to suboptimal performance. Thus, AMC is proposed as a mediator that helps SMEs leverage their EO for superior performance outcomes.

Innovation Theory complements this framework by highlighting the role of innovation in driving business success. EO dimensions like innovativeness and proactiveness align with this theory, as they focus on identifying and exploiting new opportunities for growth (Schumpeter, 1934). However, innovation alone is insufficient to ensure success. AMC enables firms to commercialize their innovations effectively by aligning their offerings with market needs and optimizing marketing strategies to create value (Mulyana et al., 2021). Figure 1 presents the conceptual framework for the study.

 Figure 1:

Based on this framework, the study develops the following hypotheses:

Direct Effects of EO on SME Performance: Given the established link between EO and performance (Lumpkin & Dess, 1996), it is hypothesized that each EO dimension positively influences SME performance.

• H1a: There is a positive and significant relationship between Innovativeness and SME performance.
• H1b: There is a positive and significant relationship between Risk-taking and SME performance.
• H1c: There is a positive and significant relationship between Autonomy and SME performance.
• H1d: There is a positive and significant relationship between Proactiveness and SME performance.
• H1e: There is a positive and significant relationship between Competitive Aggressiveness and SME performance.

Mediating Role of AMC: The study proposes that AMC mediates the relationship between EO dimensions and SME performance. This means that the impact of EO on performance is strengthened when marketing capabilities are effectively integrated into strategic actions.

• H2a: There is a positive and significant relationship between Innovativeness and Architectural Marketing Capability.
• H2b: There is a positive and significant relationship between Risk-taking and Architectural Marketing Capability.
• H2c: There is a positive and significant relationship between Autonomy and Architectural Marketing Capability.
• H2d: There is a positive and significant relationship between Proactiveness and Architectural Marketing Capability.
• H2e: There is a positive and significant relationship between Competitive Aggressiveness and Architectural Marketing Capability.

Direct Effect of AMC on SME Performance: This hypothesis posits that marketing capabilities directly influence SME performance by ensuring that entrepreneurial initiatives are effectively implemented and aligned with market needs.

• H3: There is a positive and significant relationship between Architectural Marketing Capabilities and SME performance.

Mediating Effect of AMC on the EO-SME Performance Relationship: The study proposes that AMC plays a crucial mediating role in converting EO-driven initiatives into market success, thereby enhancing the impact of EO on SME performance.

• H4: There is a positive and significant mediating effect of Architectural Marketing Capabilities on the relationship between Entrepreneurial Orientation dimensions and SME performance.

This study’s conceptual framework integrates EO, AMC, and SME performance to provide a more nuanced understanding of how SMEs in emerging economies can leverage both entrepreneurial and marketing capabilities to thrive in competitive and resource-constrained environments.

METHODOLOGY

Research Design

This study outlines a framework for future empirical testing. The study proposes a quantitative research design for testing the relationships among EO, architectural marketing capabilities, and SME performance. A deductive methodology will be used to test predefined hypotheses based on existing literature about the relationship between EO dimensions and SME performance. This approach is best for this study due to its ability to empirically validate theoretical assumptions regarding EO’s impact on performance outcomes.

Population and Sampling

The target population for this study is the SME owners and managers primarily from the trade and commerce sectors in Lagos State. Due to time and resource constraints, a convenience sampling method would be employed.

Data Collection

Data collection is through structured questionnaires administered to SME owners and managers. The questionnaire will be adapted from validated scales; the questionnaire will measure the five EO dimensions (Innovativeness, Risk-taking, Autonomy, Proactiveness, Competitive Aggressiveness), AMC, and SME on a 5-point Likert scale measurement.

Data Analysis

Data analysis will be conducted in two stages. First will be the descriptive statistics (means, standard deviations, and reliability tests) using SPSS. Next, will be the Structural Equation Modelling (SEM). Structural Equation Modelling (SEM) will be used to test the relationships among the variables. This method is suitable for assessing the direct and indirect effects of EO dimensions on SME performance through the mediation of architectural marketing capabilities.

Ethical Considerations

Ethical considerations will be strictly followed, with participants’ confidentiality guaranteed and informed consent will be obtained prior to participation. Data collected will be handled in compliance with ethical standards for academic research, ensuring their sole use for academic purposes.

CONCLUSION

This study will contribute to the going body of literature on entrepreneurship, Architectural marketing Capabilities, and the performance of SMEs in developing countries. It highlights the importance of not only which dimensions of entrepreneurial orientation (EO) contribute to performance, but how and through what processes they do so. This paper, by incorporating architectural marketing capabilities as a mediating variable, offers new insight on how the EO–performance relationship can be better understood, particularly in resource-scarce and highly volatile business environments like Nigeria.

Based on Resource-Based View (RBV) and Innovation Theory, the proposed model considers Architectural marketing capabilities to be strategic resources and enables the conversion of entrepreneurial activities such as innovativeness, Autonomy, competitiveness, proactiveness, and risk-taking into tangible results. This resonates with the theoretical understanding that having entrepreneurial traits is insufficient without an organizational system to harness them efficiently. With this, the study will help to address a gap in current literature by providing an explanation for how SMEs can enhance competitiveness and long-term sustainability by adopting a capability-oriented, multi-dimensional approach.

This study sets the foundation for future empirical research. The next step is to validate the proposed framework through rigorous data collection and statistical testing using Structural Equation Model (SEM). Such empirical validation will not only affirm the theoretical assumptions but also provide concrete recommendations for practitioners and policymakers on how to strengthen the SME sector in Nigeria and other developing nations.

Finally, this research suggests a more integrated approach to SME development. one that recognizes the synergistic relationship between entrepreneurial intent and marketing capability as a pathway to sustainable competitive advantage.

REFERENCES

1. Abdelgadir, M. A. A., & Sara, M. A. M. (2020). The effect of entrepreneurial orientation on firm’s performance of the telecommunication sector in Sudan. African Journal of Business Management, 14(5), 151–158.
2. Astrini, N. J. Rakhmawati, T., Sumaedi, S., Bakti, I. G. M. Y., Yarmen, M., & Damayanti, S. (2020). Innovativeness, proactiveness, and risk-taking: corporate entrepreneurship of Indonesian SMEs. In IOP Conference Series: Materials Science and Engineering (Vol. 722, No. 1, p. 012037). IOP Publishing.
3. Barney, J. B. (1991). Firm Resources and Sustained Competitive Advantage. Journal of Management, 17, 99-120. https://doi.org/10.1177/014920639101700108
4. Dangana, K. A. (2022). Entrepreneurial Orientation and Performance of Selected Medium Scale Manufacturing Firms in North Central, Nigeria (Doctoral dissertation, Kwara State University (Nigeria)).
5. Diaz, E., & Sensini, L. (2020). Entrepreneurial Orientation and Firm Performance: Evidence from Argentina. International Business Research, 13(8), 47.
6. Gupta, R. (2019). Entrepreneurship Orientation (EO), Resources, and Small Firm Growth: Evidence from India. International Journal of Business & Economics, 18(1).
7. Hanaysha, J. R., & Al-Shaikh, G. (2022). Examining the effect of entrepreneurial marketing dimensions on firm performance in SMEs: Empirical insights from the Middle East. Sustainability, 14(18), 11444.
8. Hoque, M. T., Ahammad, M. F., Tzokas, N., & Gabay, G. (2021). Dimensions of dynamic marketing capability and export performance. Journal of Knowledge Management, 25(5), 1219-1240.
9. Iqbal, S., Moleiro Martins, J., Nuno Mata, M., Naz, S., Akhtar, S., & Abreu, A. (2021). Linking Entrepreneurial Orientation with Innovation Performance in SMEs; the Role of Organizational Commitment and Transformational Leadership Using Smart PLS-SEM. Sustainability, 13(8), 4361.
10. Khizar, H. M. U., Iqbal, M. J., Murshed, F., & Ahsan, M. (2024). Sustainability outcomes in SMEs: a configurational view of the interplay of strategic orientations and environmental conditions. Journal of Macromarketing, 44(2), 534-552.
11. Kohtamäki, M., Heimonen, J., & Parida, V. (2019). The nonlinear relationship between entrepreneurial orientation and sales growth: The moderating effects of slack resources and absorptive capacity. Journal of Business Research, 100, 100-110.
12. Lekmat, L., Selvarajah, C., & Hewege, C. (2018). Relationship between market orientation, entrepreneurial orientation, and firm performance in thai SMEs: The mediating role of marketing capabilities. International Journal of Business and Economics, 17(3), 213-237.
13. Lumpkin, G. T. and G. G. Dess, (1996), Clarifying the Entrepreneurial Orientation Construct and Linking It to Performance, Academy of Management Review, 21(1), 135-172.
14. Mulyana, M., Zakaria, Z., & Mahmood, r. (2021). designing architectural marketing capabilities to increase the performance of small and medium-sized enterprises. revista de administerial de empresas, 61(4), e20190804.
15. Nasir, W. M. N. bin W. M., Al Mamun, A., & Breen, J. (2017). Strategic orientation and performance of SMEs in Malaysia. SAGE Open, 7(2). https://doi.org/10.1177/2158244017712768
16. Oluremi, D.O., & Maku, O.A. (2024). Small and Medium Scale Enterprises and Nigeria Economic Growth. International Journal of Small Business and Entrepreneurship Research.
17. Oluremi, O. D. & Maku, A. O. (2024) Small and Medium Scale Enterprises and Nigeria Economic Growth. International Journal of Small Business and Entrepreneurship Research. 12.05. doi: https://doi.org/10.37745/ijsber.2013/vol12n57189
18. Onwe, C. (2020). Moderating effect of dominant logic on the entrepreneurial orientation and microenterprises performance relationship in Nigeria. Academy of Entrepreneurship Journal, 26(1), 1-10.
19. Perera, L. S., & Samarakoon, S. M. A. K. (2021). Effect of entrepreneurial orientation on SMEs’ innovation performance in Sri Lanka. Asian Journal of Advanced Research and Reports, 15(2), 55-63.
20. Pratono, A. H., & Mahmood, R. (2015). Mediating effect of marketing capability and reward philosophy in the relationship between entrepreneurial orientation and firm performance. Journal of Global Entrepreneurship Research, 5, 1-12.
21. PWC (2024). PwC’s MSME Survey 2024. https://www.pwc.com/ng/en/assets/pdf/pwc-msme-survey-report-2024.pdf
22. Quaye, D., & Mensah, I. (2019). Marketing innovation and sustainable competitive advantage of manufacturing SMEs in Ghana. Management Decision, 57(7), 1535-1553.
23. Schumpeter, J.A. (1934) The Theory of Economic Development: An Inquiry into Profits, Capital, Credits, Interest, and the Business Cycle. Transaction Publishers, Piscataway.
24. Shaher, A. T. H. Q., & Ali, K. (2020). The effect of entrepreneurial orientation and knowledge management on innovation performance: The mediation role of market orientation. Management Science Letters, 10(15), 3723-3734.
25. Vincent, J. and Shin, S. (2015). The role of marketing capabilities and entrepreneurial orientation on SME performance. Journal of International Marketing Strategy. 3(1),37-54.
26. Vorhies, D. W., & Morgan, N. A. (2005). Benchmarking marketing capabilities for sustainable competitive advantage. Journal of marketing, 69(1), 80-94.
27. Weinzimmer, L., Esken, C. A., Michel, E. J., McDowell, W. C., & Mahto, R. V. (2023). The differential impact of strategic aggressiveness on firm performance: The role of firm size. Journal of Business Research, 158, 113623.
28. Zehir, C., Can, E., & Karaboga, T. (2015). Linking Entrepreneurial Orientation to Firm Performance: The Role of Differentiation Strategy and Innovation Performance. Procedia – Social and Behavioural Sciences, 210, 358–367.