Short answer

Designers and business strategists should prioritize the development of innovative, sustainable services rather than relying solely on traditional marketing approaches to improve business performance.

Field: Innovation & Markets
Source: Tourism and Hospitality (2025)
Method: Quantitative research using Structural Equation Modeling (SEM).
Sample: 387 participants
Evidence: Strong effect

For tourism SMEs, traditional marketing strategies alone do not drive business performance; integrating sustainability-focused service innovation is crucial for success. This innovation & markets research insight is drawn from a 2025 study published in Tourism and Hospitality. Using Quantitative research using structural equation modeling (sem). with 387 participants, researchers explored how this design variable affects real-world outcomes. The key design takeaway: Designers and business strategists should prioritize the development of innovative, sustainable services rather than relying solely on traditional marketing approaches to improve business performance.

Study

Innovation & MarketsNew This WeekStrong effect

Green Service Innovation is Key to SME Performance in Tourism

For tourism SMEs, traditional marketing strategies alone do not drive business performance; integrating sustainability-focused service innovation is crucial for success.

Tourism and Hospitality · 2025

Key Findings

01The marketing mix does not directly influence green service innovation or business performance.
02Green service innovation significantly enhances business performance.
03Green service innovation acts as a mediator between the marketing mix and business performance.

Application

Design takeaway

How to apply

When developing marketing plans or new service offerings, ensure that sustainability is a core component of the innovation process, not an afterthought. Measure the impact of these green innovations on key business metrics.

Project actions

01When researching a product or service, consider how its marketing is integrated with its sustainable features.
02Investigate if a company's innovation efforts are focused on environmental benefits and how this impacts their market success.

Method & Evidence

AimTo investigate how green service innovation mediates the relationship between the marketing mix and business performance in tour and travel SMEs.

MethodQuantitative research using Structural Equation Modeling (SEM).

ProcedureSurvey data on marketing mix, green service innovation, and business performance was collected from tour and travel business owners and analyzed using SEM to determine direct and indirect effects.

Sample387 participants

ContextTour and travel Small and Medium-sized Enterprises (SMEs) in Bali, Indonesia.

Variables

IVMarketing Mix (e.g., product, price, place, promotion)

DVBusiness Performance

CVCompany Size (SME), Industry Sector (Tour and Travel), Geographical Location (Bali)

Strengths & Limitations

Strengths

+Uses a robust quantitative methodology (SEM) to analyze complex relationships.
+Focuses on a relevant and timely topic (sustainable tourism and SME performance).

Limitations

The findings are specific to SMEs in a particular region (Bali tourism), so applying them to larger corporations or different industries requires careful consideration.

Reliability & validity

The use of SEM and a structured survey contributes to the reliability and validity of the findings by allowing for the statistical testing of hypothesized relationships.

Think critically

To what extent can the findings regarding green service innovation's impact on business performance be generalized to industries with less direct environmental impact than tourism?

Design Principles

"Integrate sustainability into core service innovation to drive market competitiveness and business performance."

This research highlights that simply applying standard marketing tactics is insufficient in today's market. Businesses must embed sustainability into their service offerings and operations to achieve tangible improvements in performance and competitiveness.

What This Means for Your Design

Just doing marketing isn't enough for small travel companies to do well. They need to create new services that are good for the environment (green services), and this is what really helps them perform better.

How to use in your project

1.Use this study to justify the importance of green innovation in your design project's context, especially if it involves a business or market analysis.

Add to My Project

Quick Cite

Paragraph starter

This research demonstrates that in the competitive tourism sector, traditional marketing mix elements do not directly correlate with improved business performance. Instead, the study highlights the critical mediating role of green service innovation. By developing and implementing sustainability-focused innovations, businesses can significantly enhance their performance and market competitiveness, suggesting that a strategic integration of environmental considerations into service design and marketing is paramount for long-term success.

Source

Tourism and Hospitality

Sustainable Tourism Strategies: Examining Green Service Innovation as a Mediator Between the Marketing Mix and Business Performance in Bali’s Tour and Travel SMEs

journal · 2025

View source

Questions About This Research

What does the research say about green service innovation is key to sme performance in tourism?: Designers and business strategists should prioritize the development of innovative, sustainable services rather than relying solely on traditional marketing approaches to improve business performance. Evidence: Tourism and Hospitality (2025).
Why does "Green Service Innovation is Key to SME Performance in Tourism" matter for design?: This research highlights that simply applying standard marketing tactics is insufficient in today's market. Businesses must embed sustainability into their service offerings and operations to achieve tangible improvements in performance and competitiveness.
How can designers apply this research?: Designers and business strategists should prioritize the development of innovative, sustainable services rather than relying solely on traditional marketing approaches to improve business performance.
What were the main findings?: The marketing mix does not directly influence green service innovation or business performance.. Green service innovation significantly enhances business performance.. Green service innovation acts as a mediator between the marketing mix and business performance.
What research method was used?: Quantitative research using Structural Equation Modeling (SEM). with 387 participants.
How strong is the evidence?: Evidence strength is rated Strong effect, based on a 2025 journal from Tourism and Hospitality.
What should I do differently in my next project?: When developing marketing plans or new service offerings, ensure that sustainability is a core component of the innovation process, not an afterthought. Measure the impact of these green innovations on key business metrics.
What are the limitations?: The study is specific to the tourism sector in Bali, and findings may not be directly generalizable to other industries or geographical locations.