<![CDATA[Purpose – This study examines how digital marketing is associated with the transformation of MSME business strategies in Makassar City and how this transformation relates to competitive advantage and business performance. Design/methodology/approach – An explanatory sequential mixed-methods design was used. The quantitative phase employed Structural Equation Modeling with SmartPLS, followed by qualitative inquiry through interviews, observations, and documentation to explain the quantitative patterns. Finding/Results – Digital marketing was positively associated with business strategy transformation (β = 0.731, p = 0.000) and business performance (β = 0.582, p = 0.000). Business strategy transformation was positively associated with competitive advantage (β = 0.689, p = 0.000), while competitive advantage was positively associated with business performance (β = 0.754, p = 0.000). Qualitative findings identified digital literacy, product innovation, content-creation capability, government support, and access to technology as relevant conditions. Originality/Value – This study contributes to the MSME digital transformation literature by proposing an integrated framework that explains how digital marketing capabilities are translated into business strategy transformation, competitive advantage, and performance outcomes. Unlike previous studies that predominantly examine isolated digital adoption effects, this research combines SEM-based evidence with qualitative insights to reveal the organizational conditions enabling transformation among MSMEs in an emerging-market context. The findings offer context-specific implications for MSMEs and policymakers in Makassar City.]]>
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