Marketing Activities of Small Businesses in Croatia: The Case of Splitsko-Dalmatinska County

Due to their relevance and specific features, small and medium businesses are becoming the subject of scientific studies, with the objective of adapting the economic theory and creating applicable models and tools, in order to improve their business efficiency. One of the relevant marketing research fields is the implementation of marketing activities, which is, in this exploratory research, analyzed in a sample of small businesses in Splitsko-Dalmatinska County. The objective is to bridge the gap between the understanding of small and medium business marketing in large and established market economies, versus those small and transitional economies. Results of the study indicate that there are no significant differences in marketing activities of the analyzed enterprises, when compared to small businesses worldwide. 1. INTRODUCTION It has been just more than twenty years that marketing in small and medium businesses has become the significant subject of scientific research. Although different issues have been analyzed, including relazionship between market and entrepreneurial orientation, the influence of marketing on small and medium businesses' performance, the role and organisation of marketing in small and medium business entities, as well as its other determinants, the question of appropriateness is raised. Namely, the research in this field is still quite rare in Croatia. Differences in Croatian entrepreneurial tradition, culture and environment require that research results and application of research conclusions performed in large and established market economies are tested. 1.1. Small and medium businesses and their relevance It should be emphasised at the beginning that the focus of this research is not on entrepreneurship as a phenomenon, orientation and process whose key features are innovativeness, risk-taking and proactive approach (Schindehutte et al., 2006; Lumpkin and Dess, 2001, 1996; Covin and Slevin, 1990, 1989; Miller, 1983). The focus is on small and medium businesses as a part of the economy, i.e. economic entities which can be defined by "economic" and "statistical" definition provided by the Bolton Committee (1971). While statistical criteria of the size of small and medium business entities varies from country to country, economic criteria can be considered universal - they are independent (in ownership and management), they are managed by (co)owners in a personalised way and they have a small market share. Small and medium businesses in Croatia are defined as legal entities, independent in undertaking permanent business activities in order to gain profit i.e. income on the market, which meet two out of the three required (statistical) criteria. One of the obligatory criteria is the number of employees (up to 250 employees) and the other one can either be the annual turnover (up to 216 million HRK) or (long-term) assets value (up to 108 million HRK). Small and medium business is divided into two main categories: medium and small, within which there is a micro business subgroup (Figure 1). One of the features, and at the same time one of the problems, of small and medium businesses in Croatia is a regional inequality i.e. significant concentration of their economic activities around large city centres (for example, small and medium entrepreneurs registered in Zagreb account for circa 33% of the total small and medium businesses in Croatia). On the other hand, there is a significant sectoral diversification of small and medium businesses (Figure 2). Small and medium business sector plays an important role in the economic and social development of every country, with the indicators of the impact in Croatia (Figure 3) being almost identical to those in EU. 1.2. Literature review It is generally accepted that the basic principles of marketing are universally and equally valuable and applicable to both large and small businesses (Blankson and Cheng, 2005; Reynolds, 2002; Siu and Kirby, 1998). …