Marketing Trade-Offs in Periods of Low and High Munificence: A Study of Tourism Enterprises in Uruguay

This study explores the link between contemporary marketing practices (CMP), market orientation (MO) and business performance metrics, by identifying the trade-offs that firms make when facing environmental changes. The study compares three groups of firms in two time periods (low environmental munificence vs. high environmental munificence) using data from small and medium-sized enterprises (SME) in the tourism industry in Uruguay. The results of this study provide general support for the expectation that firms exhibit greater marketing efforts (both in MO and CMP adoption) in the period of low munificence (vs. high munificence). The results show that transactional and interaction marketing practices are the basis of SMEs’ success, while e-marketing and network marketing practices gain prominence in the high munificence period. A model estimation for the three groups of firms allows us to understand the shift in marketing emphasis and its effects on performance improvement.