The Mediating Role of Brand Equity on the Relationship between Marketing Effort and SME Performance

Abstract

This study investigates factors that affect performance in SME organizations in Malaysia which is not given much research attention. Specifically, the aim of this study is to determine how marketing effort such as marketing mix, innovation and brand equity effect SME performance. This is a quantitative study where a survey methodology is employed to collect the data. SME owners and managers through out Malaysia were chosen as the sample for this study. A systematic random sampling procedure was used to select respondents from the respective owners and managers. Six main hypotheses were proposed regarding SME performance. Structured questionnaires comprising 60 items that were used to measure four variables; SME performance, marketing mix, innovation and brand equity were adopted in this study. The findings revealed that significant relationships exist among variables (marketing mix elements; pricing & distribution intensity, innovation elements; strategy innovation, & brand equity) with SME performance. The findings also revealed that brand equity mediated fully the relationships between pricing and distribution intensity (marketing mix element) and mediated partially strategy innovation (innovation element) on SME performance.