THE IMPACT OF DIGITAL TRANSFORMATION CAPABILITY ON THE MARKET PERFORMANCE OF TEA COOPERATIVES IN THAI NGUYEN PROVINCE

Abstract

This study examines the impact of digital transformation capability on the market performance of tea cooperatives in Thai Nguyen Province, Vietnam. Drawing upon Dynamic Capability Theory, the research conceptualizes digital transformation capability through four dimensions: digital operational capability, digital marketing capability, digital innovation capability, and digital customer relationship management capability. Data were collected from 320 respondents representing 40 tea cooperatives and analyzed using structural equation modeling with cluster-robust standard errors. The empirical results indicate that all four dimensions of digital transformation capability positively influence market performance. Among them, digital innovation capability exerts the strongest effect (β = 0.368), followed by digital customer relationship management capability (β = 0.297). The proposed model explains 56.4% of the variance in market performance (R² = 0.564). These findings suggest that digital transformation generates superior market outcomes only when digital resources are effectively translated into product innovation, customer engagement, customer data management, and improvements in marketing and sales activities. The study provides practical implications for tea cooperatives by emphasizing the strategic importance of strengthening digital innovation and leveraging customer data to enhance market competitiveness and sustainable growth.