Abstract

Driven by the increasing complexity of modern marketing and the growing pressure to justify the contributions of marketing activities to firm performance, marketers have shown considerable interest in implementing and improving marketing performance measurement systems (MPMSs). However, there is an ongoing debate about the usefulness of adopting MPMSs. As limited empirical research has been conducted in this area, scholars call for more studies to advance the understanding of the effects of MPMSs on firm performance (Homburg, Artz & Wieseke, 2012; O’Sullivan & Abela, 2007). Drawing on the marketing performance measurement literature, dynamic capabilities (DC) theory and contingency theory, this study aims to develop an integrated framework to explain how and under what circumstances MPMSs influence firm performance. Using survey data collected from 209 Irish-based companies and interview data collected from 13 managers, this study finds that 1) the comprehensiveness of MPMSs influences firm performance through the impact on the use of MPMSs and marketing capabilities; 2) the interactive use of MPMSs improves firm performance by enhancing crucial marketing capabilities, while their diagnostic use leads to inferior firm performance potentially due to the negative impact on such capabilities; and 3) technological turbulence and competitive intensity strengthen the positive impact of MPMSs on firm performance. This study contributes to the literature and practice in several ways: 1) a novel practices-uses-capabilities-performance approach is developed to explain the effects of MPMSs on firm performance, 2) this study empirically confirms that contingencies influence the effectiveness of MPMSs, 3) it extends DC theory by empirically supporting the critical role of management practices in building marketing capabilities, and 4) it provides insights into how companies can use their MPMSs to develop marketing capabilities and improve firm performance in different contexts.