Analyzing the Readiness Factors of Digital Marketing Adoption in Sri Lankan Startups

Abstract

This research investigates the readiness factors of digital marketing adoption and its impact on Sri Lankan startups. Based on a systematic literature review, the study identifies critical readiness factors that influence the adoption of digital marketing by extending the TOE (Technology-Organization Environment) framework and PERM (Perceived E-Readiness Model). The Derived factors are categorized into internal factors, such as Technological Infrastructure (TI), Knowledge and Skills of Employees (KSOE), Top Management Support (TMS), and Cost Advantages and Savings (CAAS), as well as external factors, including Market Competition (MC), Technological Advancements (TA), Economic Conditions (EC), and Industry Type (IT). The study employs a quantitative research approach, using a structured questionnaire distributed to startup professionals across various industries in Sri Lanka. A total of 171 valid samples were analyzed using Partial Least Squares Structural Equation Modeling (PLS-SEM). The findings indicate a positive relationship between internal readiness factors and Digital Marketing Adoption (DMA), along with the mediating impact of DMA on digital marketing performance and the moderating impact of external environmental factors. The derived results contribute to theoretical understanding and provide practical insights on effectively navigating the digital landscape, by empowering the Sri Lankan startups to leverage digital marketing strategies to enhance competitiveness and achieve sustainable growth. However, the study is subject to several limitations, including its exclusive focus on Sri Lankan startups and reliance on cross-sectional, self-reported data. Future research should address these limitations by incorporating a larger sample size, a combination of analytical techniques, longitudinal approaches, and a broader range of industry-specific contexts to provide deeper insights into the evolving trends and dynamics of startups' digital marketing adoption.