The adoption of the marketing concept in the operations of free trade zones : a comparative global study
This study is an empirical investigation of the marketing concept adoption by the authorities of Free Trade Zones (FTZs) throughout the world. The aim of the study is to gain an insight into the marketing orientation of the FTZs authorities by systematically Identifying, analysing and evaluating the attitudes of selected FTZs authorities towards the adoption of the marketing concept in the operations of their zones. Therefore, forty variables representing the key elements of the marketing concept (i. e., satisfying the customer needs, achieving organisational goals and integrating the marketing functions) are developed to describe and profile the FTZs according to their marketing orientation. , Before starting the data analysis, an attempt is made to develop a proper understanding of FTZs. Therefore, a thorough investigation is conducted on FTZs In terms of a variety of aspects including the historical development, the broad concept of free trade; the definitions, the types, the characteristics, and the advantages of FTZs; the FTZs development, spread, and status in modern times; and the future of FTZs. The efforts made here resulted In the production of two different models. One model shows how FTZs; are related to and distinguished from other forms of the broader concept of free trade. The other model presents an alternative way of classifying the different types of FTZs. In addition, since this study is about the marketing orientation of FTZs, the marketing concept is explored in terms of; its evolution, its contrast with other management philosophies, its criticism, and its relevance to this study. The presentation of the marketing concept is concluded with a further model depicting the flow of transactions involved in a FTZ enterprise. Of particular interest to this research is the establishment of the confidence limits of the marketing orientation in the FTZs operations. Such limits are obtained through taking the average of the received responses of the FTZs experts’ panel, and on which we would be able to assign the FTZs into three suggested groups on the basis of their marketing orientation (i. e., most, moderate, and less marketing-oriented). With such "a priori classification of the FTZs, under study, the data can be readily available for further applications of statistical techniques, and more meaningful analysis can be carried out The design of the research Is guided by a number of hypotheses about discrimination among/between the FTZs groups according to their authorities' attitudes toward the variables related -to the marketing concept in the operations of the zones. The discrimination is made among/between: (a) the most, the moderate, and the less marketing- oriented FTZs; (b) the marketing-oriented (i. e., the most and the moderate combined together) and the less marketing-oriented FTZs; and (c) the FTZs in the developed and developing countries. In addition, the research is based upon another set of hypotheses regarding the significant differences between , the FTZs experts and each of the above mentioned groups of FTZs' authorities, in their evaluative attitudes toward the marketing concept variables. The required primary data are collected via International mail survey preceded by pre-contacts by telephone and telex. All the attitudinal measures developed for this study are assessed in terms of their reliability (using Cronbach's alpha) and validity (using content validity). Then the data are analysed by the application of a variety of statistical tests and techniques: (1) Discriminant Function Analysis (using both versions the Multiple and the Two-group DFA); (2) the Wilks' Lambda for testing the significance of the hypotheses related to the DFA applications by considering all the variables in aggregate; (3) the Univariate F-ratio also for testing the significance of the hypotheses related to the DFA applications but by considering each of the variables individually; (4) using the Jacknife method to validate each of the three DFA functions; (5) Profile Analysis; (6) the Hotelling's T! statistic for testing the significance of the hypotheses related to the application of Profile Analysis; and (7) Correlation Analysis. I The Multiple DFA is applied'to analyse the differences among the most, the moderate and the less marketing-oriented FTZs. And the hypotheses regarding the significance of the differences among the three groups are tested by both the Wilks' Lambda when all the variables are considered in aggregate, and the Univariate F-ratio when each variable is considered individually. The results Indicate that there are significant differences among the three FTZs groups when all the variables are taken together and when each variable is considered separately. The multiple DFA findings show that there are 19 good discriminating variables among the three FTZs groups. Among the most Important discriminators are, the maintenance of telecommunication systems, the offering of a facsimile system, the size of area available for manufacturing, the maximisation of sales, the maximisation of market share, marketing research activities, and expanding the area available for the zone privileges. The Two-group DFA is applied twice. First, to analyse the differences between the marketing-oriented FTZs group (by combining the most and the moderate) and the less marketing-oriented FTZs group. Second, to analyse the differences between the FTZs in the developed countries and the- FTZs in the developing countries. And the hypotheses regarding the significance of the differences between each set of the two FTZs; groups is also tested by both the Wilks' Lambda when considering all the variables together, and the Univariate F-ratio when each variable Is considered individually. In the first run of the Two- group DFA, the results indicate that there are significant differences between the marketing- oriented and the less marketing-oriented FTZs, in both cases when the marketing variables were considered collectively and when each variable is considered individually. Here there are 14 good discriminating variables, and among the main discriminators are: the marketing research activities, the maximisation of market share, the maximisation of sales, and the quality of the work force. The findings of the second run of the two-group DFA shows that there are significant differences between the FTZs In the developed countries and the FTZs in the developing countries when all the variables are considered collectively. However, when each variable is considered individually, the results indicate that there are significant differences between the two typologies but only with respect to 9 variables including: the size of area available for manufacturing activities, the utilities for manufacturing activities, the capacity of space for warehousing and storage, and size of the work force. Later on, Profile Analysis is applied twice. First, to compare the attitudes of the three FTZs groups (the most, the moderate, -and the less marketing-oriented) and the attitudes of the FTZs' experts towards key discriminating variables. Second, to compare the attitudes of the FTZs; in the developed and developing countries with the attitudes of the FTZs; experts. In addition, the hypotheses regarding the differences/similarities, In both cases, are tested by the Hotelling's T1 statistic. The first application of Profile Analysis shows that while the attitudes of the moderate marketing-orientated FTZs; are similar to the attitudes of the FTZs experts, the attitudes of both the most and the less marketing-orientated FTZs are significantly different from the attitudes of the FTZs experts particularly with respect to the well-being of the work force, the capacity of storage and warehousing, and the marketing research activities.