The Power of Dynamic Marketing Capability in Lao SMES: The Roles of Innovation and Entrepreneurial Capability

Abstract

Introduction: This quantitative study investigates the dynamic marketing capabilities of small and medium enterprises (SMEs) in Lao PDR, using the resource-based view theory (RBV) and the dynamic marketing capability theory (DMC) as theoretical frameworks.   Methods: Data were collected through questionnaires distributed to 367 entrepreneurs in Vientiane, Savannakhet, and Champasack provinces. Structural Equation Modeling analysis was conducted using the SMART PLS 4.0 software.   Results: Findings reveal that entrepreneurial capabilities and innovative abilities significantly influence the development of dynamic marketing capabilities among Lao SMEs. Dynamic marketing capabilities positively affected both marketing and firm performance.   Discussion: The findings emphasize the importance of nurturing dynamic marketing capabilities for SMEs in Lao PDR. Environmental dynamism and government support examine the moderating role of external factors’ impact on SMEs' adaptability.   Conclusion: This study underscores the significance of DMC for SMEs in enhancing organizational efficiency and profitability in Lao PDR. The findings can serve as a guideline for businesses and policymakers to navigate the complexities of the local business landscape.