Digital Marketing Capability and Its Impact on Performance of Tourism Accommodation Small and Medium-Sized Enterprises in the Central Coast Region of Vietnam

Digital marketing technologies are no longer a rare and inimitable resource in tourism and hospitality. The critical question for enterprises in recent years is not the adoption of digital marketing technologies but how to leverage these technologies to create competitive advantages and improve a firm’s performance. Digital marketing capability has been recognised as crucial to employing digital marketing successfully. However, empirical studies examining this concept, particularly within the context of tourism accommodation SMEs in emerging countries like Vietnam, remain limited. This research project investigates digital marketing capability (DMC), its critical antecedents, and its impact on the performance of tourism accommodation SMEs in the Central Coast Region of Vietnam. The research objectives are to (a) determine the critical drivers of digital marketing capability in tourism accommodation SMEs; (b) determine the impact of applying digital marketing on tourism accommodation SMEs’ performance; (c) develop a guideline for tourism accommodation SMEs in Vietnam to improve their performance using digital marketing. With the identified research objectives, this study conducted a comprehensive literature review on digital marketing in tourism and hospitality. The extant studies were systematically selected, compared and contrasted to identify critical research themes, the achievements of extant studies, and the research gaps. The intensive literature review resulted in a conceptual framework that combined the resource-based view (RBV) and dynamic capabilities theory as theoretical lenses. The conceptual framework reflected the whole picture of digital marketing capability, its antecedents, and its consequences in the context of tourism SMEs. The conceptual framework provided the directions to investigate market orientation and RBV factors as the critical antecedents of digital marketing capability. The framework also explained how digital marketing capability can improve higher-order marketing capabilities, including customer engagement, customer relationship management, innovation, and branding. Then, both the DMC and higher-order marketing capabilities enhance the performance of tourism accommodation SMEs. Under the pragmatism paradigm, this study applied a mixed-methods design that used the qualitative study to explore the conceptual framework and then used the quantitative study to test the theoretical frameworks. In the qualitative study, the conceptual framework was explored and validated. Fourteen cases of tourism accommodation SMEs in three typical tourism destinations of Vietnam, including Hue, Danang, and Hoian, were investigated. The template analysis technique was applied to analyse the qualitative data from in-depth interviews with owners or managers. The data analysis process resulted in seven themes that suggest the direction to propose the theoretical frameworks for the quantitative study in the next phase. Two theoretical frameworks were developed in the quantitative study to address the research questions. An online survey conducted via the Qualtrics platform collected responses from owners and managers of tourism accommodation SMEs in three provinces and one city of the Central Coast Region in Vietnam, including Thua Thien Hue, Quang Nam, Khanh Hoa, and Danang. The PLS-SEM was adopted to analyse the data of 249 qualified respondents. The key findings show that human, business, and technology resources are critical for building digital marketing capability. DMC significantly enhances non-financial performance directly and indirectly via branding capability. DMC also results in customer engagement capability and service innovation capability. These two capabilities indirectly impact non-financial performance via branding capability. The findings extend the discussions on DMC and the role of higher-order marketing capabilities in explaining the mechanism of transforming digital marketing technology adoption into a firm’s performance. The findings also provide practical implications for owners and managers of tourism accommodation SMEs to improve their performance using digital marketing.