engleski

Role of innovativeness and hostility for the market and new product development in hospitality industries of the Adriatic region: Case of Croatia and Montenegro

Tourism's hospitality sector faces a high degree of competition in Croatia and Montenegro. The rise of the concentration in the sector threatens to squeeze-out micro and small firms out of the market due to the product standardization of large hotel chains. Herein, market orientation and marketing practices are important as the final product, a customer experience, needs to be continuously catered for (Friel, 1999 ; Kasim et al., 2018). Many processes inhibit the increase in customer experience, and innovation, especially in micro and small firms. Therefore, this study aims to question whether a hostile business environment affects the hospitality industry's small firms' innovativeness on one side and the hospitality industry's small firms' innovativeness and new product development and market development on the other side. This paper uses hierarchical linear regression to assess the form and magnitude of the relationships between observed variables. Results confirm the direct and positive effect of innovativeness on new product development and market development but reject the influence of hostility on innovativenes. The significance of the study stems from its importance for the hospitality industry. Namely, the management of small firms within hospitality industries should continue investing in their innovation capacities to build up their capabilities for timely response to their customers' ever-changing tastes and preferences. Such investments lead to new product/service offerings, capturing new clients and market shares. Furthermore, drastic changes in the environment lead to negative performance, primarily when firms operate in hostile environments, which are usually characterized as stressful and very risky due to the intense competition, overwhelming business climate, and a relative lack of opportunity for exploitation. Therefore, management needs to develop timely contingency plans when their environment starts changing from benign to hostile.

small hospitality firms ; innovativeness ; market development ; new product development ; hostility

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