Marketing capabilities, market ambidexterity and product innovation outcomes: A yin-yang of inside-out and outside-in

The existing literature acknowledges the implementation of ambidexterity at the firm level or within specific functional domains as a means to enhance new product innovation performance. However, the understanding of how ambidexterity can be achieved within the marketing function, referred to as market ambidexterity, and its impact on new product innovation outcomes remains limited. This study bridges this gap by integrating theoretical insights from inside-out and outside-in strategic perspectives, as well as contextual and within-functional ambidexterity literature. It proposes that two crucial marketing capabilities, namely inside-out and outside-in, play a vital role in fostering market ambidexterity, which subsequently improves new product innovation outcomes. Grounded in the specific context of emerging economy firms, the proposed model is empirically validated using data gathered from 292 manufacturing firms in Pakistan. The results show that both inside-out and outside-in marketing capabilities individually have an inverted U-shaped relationship with market ambidexterity. However, when these capabilities synergize, they significantly positively influence market ambidexterity, which in turn positively influences new product innovation outcomes. These findings have important implications for both theoretical understanding and practical application.