Investigating the effect of market entry and strategic direction on firm's financial performance

Abstract

The company's business strategy reflects how the company is competitive in the company's selected market. Many companies are trying to gain competitive advantage by developing appropriate competitive strategies and, by increasing the competitiveness of their products, provide the basis for the growth and development of the company. The paper’s aim is to investigate the effect of market entry and strategic orientations on financial performance of Tehran Stock Exchange companies. Thus, financial data of 150 companies of Tehran Stock Exchange for the period of 1390-1395 used to test the research hypotheses. The generalized least squares regression model has been used to test the combining data. As the research findings, the direct order of entry into the market active by the adoption of strategic performance orientations of the companies. But the initial followers of the strategy of marketing differentiation and the new companies entering the strategy leadership have a successful performance based on asset efficiency and sales returns. The adoption of an innovative differentiation strategy for pioneering and early-stage companies has a positive and significant impact on asset efficiency as a measure of corporate financial performance.

Keywords

• market entry
• cost leadership strategy
• innovative differentiation strategy
• marketing differentiation strategy
• financial performance