PurposeThis study examines how market orientation (MO) affects hotel performance through the value-based marketing innovation intermediate function.Design/methodology/approach:Structural equation modeling-partial least squares (SEM-PLS) analyses are performed to assess the proposed research model on a sample of 166 three-to-five-star hotels located in six provinces of Java Island, Indonesia.FindingsThe findings indicate that MO influences value-based marketing innovation and hotel performance. Additionally, it was demonstrated that value-based marketing innovation mediates the indirect link between MO and hotel performance.Practical implicationsThis research encourages the managers of hotels to adopt MO as the company's culture and to pay close attention to value-based marketing innovation to recognize the potential benefit of MO in hotel performance enhancement.Originality/valueThis research focuses on unifying MO and resource-based view into a cohesive approach to better understand the link between MO and value-based marketing innovation and how both aspects affect hotel performance.