COMPETITIVE ADVANTAGES BASED ON MARKET ORIENTATION AND INNOVATION

: The research objective was to determine the effect of market orientation and innovation on competitive advantage. This research is field research on bag artisans in Bojong Rangkas Village, Ciampea District, Bogor Regency. The population of the study was 150 bag craftsmen using the Slovin formula and obtained a sample of 60 respondents. Distribution of questionnaires using an accidental sampling technique. Data analysis carried out; (1) test the research instruments in the form of validity and reliability tests; (2) classic assumption tests in the form of normality, multicollinearity, and heteroscedasticity tests. After the data fulfills all the classical assumptions, then multiple linear regression analysis, determination test, t-test, and F test are carried out. The research findings show that market orientation and innovation have a positive effect on competitive advantage in the bag craftsmen of Bojong Rangkas village, Ciampea district. The managerial implication of the research results is to increase the competitive advantage of the Bojong Rangkas bag artisans; attention to market orientation and innovation are important things that must be done. As for how to improve market orientation and innovation, the bag craftsmen must be oriented towards consumer desire and satisfaction.


INTRODUCTION
The small industry is a sector that develops in rural areas after agriculture. This is a small industry; the industrial sector is most developed in rural areas because of the many absorb labor. BPS data for 2019 shows that around 61.57% of the workforce in Indonesia is absorbed by the Small and Medium Industry sector. According to Tambunan (2012), at least half of the unemployed have just been absorbed by the informal sector, small industry, and other stairs.
Ciampea sub-district is part of the Bogor regency, West Java province, and has been stipulated in PERDA NO. 19 of 2008 article 37 paragraph 4 Letter C as the center of the bag craft industry. The bag craft industry in Ciampea Subdistrict has been around since 1974. There are two Yulianingsih, Palahudin, P., & Mukmin, M. (2021). COMPETITIVE ADVANTAGES BASED ON MARKET ORIENTATION AND INNOVATION . Indonesian Journal of Social Research (IJSR), 3(1), 17-26. https://doi.org/10.30997/ijsr.v2i3.83 villages, the most dominating as the center of the bag industry, namely Bojong Rangkas Village and Tegal Waru Village.
This research was conducted in Bojong Rangkas Village. In that village, there are many bag craft industries that are carried out in people's homes that produce various styles, types, and sizes of bags. The scale of business varies, from small scale industry to medium scale industry. Almost all of the bag craftsmen are local people. The average level of education in junior high and high school graduates is due to economic and family problems as well as the availability of very easy jobs so that they prefer to become bag craftsmen than to continue their education to a higher level.
Considering that the competition in the bag industry is getting tighter and the production of bags is increasingly diverse, the Bojong Rangkas bag craftsmen must be responsive to the various competitions that arise from their own area and outside the Ciampea sub-district. For this reason, the Bojong Rangkas bag craftsmen must produce products that are superior to their competitors. A superior product is a crucial instrument for business actors to stay in the industry and maintain their existence in the industry (Porter, 1980). There are capabilities that must be possessed by business actors in order to have a competitive advantage, including through market orientation and innovation (Bakti & Harun, 2011).
Market orientation is a company strategy to create better customer value, which in turn leads to competitive advantage (Kaur & Mantok, 2015). However, market orientation has not become a business culture in most small and medium industries (Rosnawintang, 2012). This also happened to the Bojong Rangkas bag craftsmen. Even though the Bojong Rangkas bag is the leading bag center in Ciampea sub-district, based on a survey conducted with several business actors, it has not shown maximum sales, and this is because; 1) Lack of managerial ability to access and market information, bag production is carried out if there are only orders and if there is no order they choose to work for other bag craftsmen; 2) Not yet market-oriented in carrying out marketing activities, still conventional in nature and not maximally utilizing information technology to accelerate services and expand market access.
The next capability in order to have a competitive advantage is that the Bojong Rangkas bag craftsmen must be able to create new thoughts and ideas by offering innovative products so that they can satisfy customers. From here, the bag craftsmen are required to produce bags according to trends so that they can create a competitive advantage. Because in general, the bag craftsmen will produce bags only if there is an order so that the model and design, as well as the brand, comes from the shop that ordered it. That is one of the weaknesses of the bag industry in the village of Bojong Rangkas, namely the lack of creativity in creating uniqueness for the products produced so that they have not been able to innovate to create new things even though innovation is an important thing that will guarantee the company's competitive ability (Gray, 2002).
So to increase the competitive advantage of the Bojong Rangkas bag craftsmen, attention to market orientation and innovation are important things that must be done so that the resulting bags have an advantage. To find out how much the contribution of these two variables in an effort to increase the competitive advantage of bag craftsmen, we need special research related to "competitive advantage based on market orientation and innovation in Bojong Rangkas bag craftsmen, Ciampea sub-district."

Competitive Advantage
According to Kotler's (2012) states that competitive advantage is the company's ability to do something that will not be matched by its competitors and its advantages must be recognized and felt by customers. Hasan (2009) states that competitive advantage is described by the company taking a step ahead of the same industry. Coyne (2005) argues that competitive advantage is the result of product differences among competitors. The indicators of competitive advantage according to Sari (2020) are: 1) superior quality of the product produced; 2) competitive price; 3) skills and capacities; 4) uniqueness; 5) not easy to imitate.

Market Orientation Market
Orientation is one part of marketing. Market orientation is a combination of a culture of commitment to customer value from the process of creating superior value for consumers (Tjiptono, 2008). According to Kotler (2012), market orientation is a response or response to market changes. The main purpose of market orientation is to create superior value for customers based on knowledge derived from customer and competitor analysis, where this information is obtained and disseminated to all elements of the organization, and this market orientation will also drive organizational culture. Meanwhile, Fatah (2013) defines market orientation as a multidimensional concept where this concept can be formulated through: 1. Focus on customers, namely through understanding their needs, providing value to customers, and ultimately providing a high level of satisfaction to customers. 2. Focus on competitors, namely responding to competitive threats and identifying competitors' strengths and weaknesses. 3. The inter-functional condition is the integration of all company members in meeting customer needs.

Innovation
Rapid technological advances and high levels of competition require each company to continuously innovate products, which in turn will increase the company's competitive advantage. The definition of innovation is a combination of processes that influence each other and are interconnected, so innovation is not a new idea or new invention, but innovation is a description of all processes (Kotler, 2007). According to Sunarya (2013), innovation is the ability to apply creativity into something that can be implemented and provides added value to the resources owned. According to Zimmerer and Scarborough (2008), innovation is the ability to apply creative solutions to problems and opportunities to improve or enrich people's lives. Innovative entrepreneurship is an entrepreneur who is able to create new things to continue to grow. An innovative entrepreneur, it can be seen from the ability he has to implement every creative idea he thinks of. Indicators of innovation variables that will be used in this study, according to Freeman (2004), include: 1. Innovation culture, namely innovation through the creation of new products. 2. Technical innovation, namely the process of change in producing new products. 3. Service innovation, which is a process related to serving consumers.

Relationship between Market Orientation, Innovation, and Competitive Advantage
According to Narver and Slater (1995) explain that companies that have made market orientation an organizational culture will focus on market needs wants, and demands to formulate strategies that will determine the company's success. Regarding competitive advantage, research results by Felgueria & Gouveia (2012); Anjaningrum & Widiya (2018); Mustafa et al (2015), and  (2017) show that market orientation has a positive effect on competitive advantage. Gray et al (2002) stated that the innovation ability of a company would guarantee the company's competitiveness. Research results from Fatah (2013) (2017) show that innovation has a positive effect on competitive advantage.

Conceptual Framework and Research Hypotheses
Based on the theoretical basis and research previous, a conceptual framework and hypothesis can be made as follows: : There is a positive influence of innovation on competitive advantage in the Bojong Rangkas bag craftsmen. H3 : There is a positive influence of orientation and innovation simultaneously on the competitive advantage of the Bojong Rangkas bag craftsmen.

METHODS
The research design used in this study is descriptive and verification. Descriptive is research related to the question of the existence of independent variables, either only one or more variables, while verification is research conducted on a particular population or sample with the aim of testing predetermined hypotheses. The approach used is a quantitative approach in the form of respondents' perceptions of market orientation, innovation, and competitive advantage. The perception is quantified on a scale Likert 5-point from strongly disagree to agree strongly. The population in this study were 150 bag craftsmen in Bojong Rangkas Village, Ciampea District, Regency. Based on calculations using the Slovin formula with an error tolerance limit of 10%, the sample in this study amounted to 60 respondents. Researchers distributed questionnaires using the technique of Accidental Sampling. Accidental Sampling is taking respondents as a sample based on chance; that is, anyone who happens to meet the researcher can be used as a sample if the person who happens to be met is suitable as a data source (Sugiyono, 2017).
Before being processed and studied, data quality tests were carried out in order to understand the respondent's persistence in answering questions, namely validity and reliability tests. The validity test used the Pearson Product Moment formula, and the reliability test used Cronbach alpha. Before the multiple linear regression method is used in hypothesis testing, the model will first be tested whether the method meets the classical assumptions or not; this is intended to ensure that the model obtained actually meets the basic assumptions in the regression analysis. The classical assumptions used to consist of the normality test, multicollinearity test, and heteroscedasticity test.
Data analysis using multiple linear regression to determine whether there is an effect of market orientation and innovation on competitive advantage in the craftsmen of Bojong Rangkas Village. The regression equation can be formulated as follows: Y = a + β1X1 + β2X2 + ε. To find out how the relationship between market orientation and product innovation with a competitive advantage is used the product-moment formula (Sugiyono, 2017) as follows: Determination analysis is used to determine the percentage of variable influence contributions (X1, X2) simultaneously to the dependent variable (Y). This coefficient shows how much the percentage of the independent variables used in the model is able to explain the variation in the dependent variable. The coefficient of determination is between zero or one. The greater the number of R 2, the better the model used to explain the relationship of independent variables on the dependent variable; if R 2 means the weaker, the smaller the model to explain the dependent variable (Ghozali, 2012). The formula for the coefficient of determination is: KD = R² x 100% Description: KD = coefficient of determination, R = correlation coefficient Hypothesis Testing using t-test and F-test. The t-test or partial test is used to determine how far the influence of the independent variable partially affects the dependent variable, while the F test is used to determine the effect of the independent variable simultaneously on the dependent variable (Ghozali, 2012).

Characteristics of Respondents
In this study, the researcher spreads 60 questionnaires for bag craftsmen in the village of Bojong Rangkas. Grouping of respondents based on gender, age, latest education, and income. Respondents in the study consisted 82% are male, 18% are female respondents, 20% over 20 years old, 37% between 20 -39 years old, 43% between 30-39 years old, 17% primary school education, 37% have a junior high school education, 33% have a high school education, 13% have a bachelor's degree. Respondents with an income below 2 million were 38%, respondents had an income between 2-5 million as much as 40%, and respondents with an income above 5 million were 22%.

Validity and Reliability
The validity test of 60 respondents showed that all indicator items in the market orientation, innovation, and competitive advantage were declared valid because the calculated r value was greater than 0.3. Reliability test results show that the indicators of market orientation variables, product innovation, and competitive advantage are declared reliable because the Cronbach Alpha value is greater than 0.6.

Normality Test
The method used by researchers in testing normality is by looking at the graphs histogram and P-Plot. The data is said to be normal if the data spread around the diagonal line and follows the direction of the diagonal line or the histogram graph; on the contrary, the data is said to be not normally distributed if the data spreads far from the line or does not follow the diagonal or histogram graph.

Multicollinearity Test
The test is used to test whether there is a correlation between independent variables. To be able to determine whether there is multicollinearity in the regression model in this study is to look at the VIF (Variance Inflation Factor) and tolerance and analyze the correlation matrix of the independent variables. All variables have a VIF value of 1,662 less than 10 and a tolerance value of 0.602 greater than 0.10, which means that there is no correlation between independent variables, so the model is feasible to be used to predict competitive advantage. There is no clear pattern and dots spread over the number 0 (zero) on the axis Y, then there is no heteroscedasticity.

Heteroscedasticity
The heteroscedasticity test aims to test whether in the regression model, there is an inequality of variance from the residuals of one observation to another. Heteroscedasticity test generates chart patterns point spread (scatterplot). There is no clear pattern and dots spread over the number 0 (zero) on the axis Y, then there is no heteroscedasticity.

Results
The partial test results for the market orientation variable (X1) obtained tcount of 1,967 and a significance degree of 0.000 <0.05 and N -1 or 60 -1 = 59 obtained ttable = 1,670. The test criteria if the value of tcount > ttable then H0 is rejected. From the research results obtained tcount of 1,967> ttable 1,670 with a significance level of 0.054, which means that H0 is rejected and H1 is accepted. This means that there is a positive and significant effect of market orientation on competitive advantage in bag craftsmen in Bojong Rangkas Village, Ciampea District, Bogor Regency. The partial test results for the product innovation variable (X2) obtained tcount of 14.072 and a significant degree of 0.000 <0.05 and N -1 or 60 -1 = 59 obtained ttable = 1.670. The test criteria if the value of tcount > ttable then H0 is rejected. From the research results obtained tcount of 14.072> ttable 1.670 with a significance level of 0.000, which means that H0 is rejected and H1 is accepted. This means that there is a positive and significant influence of innovation on competitive advantage in the bag craftsmen of Bojong Rangkas Village, Ciampea District, Bogor Regency.
The regression significance test criteria is if Fcount > Ftable then Ho is rejected and H1 is accepted. From the table, it is ANOVA obtained Fcounting 196. 762 and the degree of significance of 0.000 <0.05 and N -K or 60 -3 = 57, it is obtained Ftable = 3.16. The result is that the value of Fcount > Ftable or 196,762> 3.16, it means that market orientation and innovation together have a positive and significant effect on the competitive advantage of craftsmen. Based on the calculation of multiple regression analysis using the SPSS tool, the regression equation: Y = 11,347 + 0.127X1 + 1. 147X2 + ε A regression coefficient is a number that shows the level of influence of each independent variable on the dependent variable. the relationship between market orientation and product innovation with a competitive advantage in craftsmen Bojong Rangkas bags show a correlation number of 0.935, which is in a very strong category, meaning that the higher the market orientation and product innovation, the competitive advantage of bag craftsmen will increase. R Square is 0.873 or 87.3%. This shows that the percentage contribution of the influence of the market orientation variable (X1) and innovation (X2) on competitive advantage (Y) is 0.873 or 87.3% while the remaining 12.7% is influenced by other variables, not a meticulous writer.

Discussion
Value of 0.127 is the coefficient value for variable X1 for the value of b1 in the multiple linear regression line equation Y = a + b1X1, so b1 = 0.127 means that every 1 point increase in market orientation will affect the increase in competitive advantage in bag craftsmen in Bojong Rangkas Village, Ciampea District, Bogor Regency by 0.127 points provided the other independent variables are constant. The value of 11,347 is a constant value or a pure value, which indicates that if X1 = 0, then the competitive advantage of bag craftsmen in Bojong Rangkas Village, Ciampea District, Bogor Regency is 11,347. This research is in line with research conducted by Zhou (2009)  Value of 1.147 is the coefficient value for variable X2 for value b2 in the multiple linear regression line equation Y = a + b2X2 so b2 = 1.147 means that every 1 point increase in innovation will affect the increase in competitive advantage in bag craftsmen in Bojong Rangkas Village, Ciampea District, Bogor Regency by 1,147 points with the other independent variable terms are constant. The value of 11,347 is a constant value or a pure value, which indicates that if X1 = 0, then the competitive advantage of bag craftsmen in Bojong Rangkas Village, Ciampea District, Bogor Regency is 11,347. This research is in line with research by Fatah (2013) (2017) which state that product innovation has an effect on competitive advantage.
The effect of market orientation and innovation simultaneously or simultaneously on competitive advantage in the bag craftsmen of Bojong Rangkas Village, Ciampea District, Bogor Regency is indicated by an Adjusted R Square value of 0.869 or (86.9%). This shows that the percentage of the contribution of the influence of the independent variables, namely market orientation and innovation on competitive advantage in the bag craftsmen of Bojong Rangkas Village, Ciampea District, Bogor Regency is 86.9%, the remaining 13.1% (100% -86.9%) is influenced by other variables that are not conscientious. This research is in line with the research of Sari et.all (2020); Anjaningrum & Widiya (2018); Satwika et. all (2018) which states that market orientation and product innovation simultaneously influence competitive advantage.

CONCLUSION
In this study, the business scale studied did not differentiate between variations in business size, namely micro, small, and medium enterprises. In addition, the population of this study is limited to small and medium industry players in Bojong Rangkas Village, Ciampea District, Bogor Regency. Future research is suggested to further expand the population. For example, the sample size used is enlarged, and it is necessary to differentiate between variations in the size of the business, namely micro, small, and medium enterprises.
The results of the research were conducted to prove that there is a positive effect of market orientation on competitive advantage in bag craftsmen in Bojong Rangkas Village, Ciampea District, Bogor Regency. And it means that when the market orientation increases, the competitive advantage will increase and vice versa. The results of the research conducted to prove that there is a positive influence of innovation on competitive advantage in bag craftsmen in Bojong Rangkas Village, Ciampea District, Bogor Regency, thus increasing competitive advantage can be done by increasing interesting innovations. The results of the research conducted to prove that there is a positive influence of market orientation and innovation together or simultaneously on the competitive advantage of bag craftsmen in Bojong Rangkas Village, Ciampea District, Bogor Regency.