Digital Marketing Capability and Perceived Market Performance Among Small Businesses in Hyderabad, Sindh

Abstract

Purpose- This study examines the relationship between digital marketing capability and perceived market performance among small businesses in Hyderabad, Sindh. It also investigates the mediating role of digital marketing adoption and evaluates how owner market orientation and perceived barriers influence digital marketing adoption and business performance. Methodology- A quantitative cross-sectional research design was employed. Data were collected from 128 small businesses operating in the retail and service sectors in Hyderabad, Sindh. A structured questionnaire was used to measure digital marketing capability, digital marketing adoption, owner market orientation, perceived barriers, and perceived market performance. The data were analyzed using descriptive statistics, correlation analysis, multiple regression analysis, logistic regression, and mediation analysis. Results- The findings reveal a significant positive relationship between digital marketing capability and perceived market performance. Businesses with stronger digital marketing capabilities reported higher levels of market performance. Digital marketing adoption partially mediated this relationship, indicating that capability enhances performance both directly and indirectly through greater adoption of digital marketing tools. Owner market orientation positively influenced digital marketing adoption, whereas perceived barriers negatively affected both adoption and performance outcomes. Conclusions- Digital marketing capability is a critical determinant of perceived market performance among small businesses. While digital marketing adoption serves as an important mechanism linking capability to performance, the direct effect of capability remains substantial. Implications- Small business owners should prioritize the development of strategic digital marketing capabilities alongside technology adoption. Policymakers and SME support organizations should facilitate digital capability-building initiatives to improve competitiveness and long-term business sustainability.

Keywords: Digital marketing capability; perceived market performance; digital marketing adoption; owner market orientation; SMEs.