Applied Strategy- Academic – Internet Strategy of
E-Commerce Business in Thailand
The purpose of this article was to test the effects of
internet strategy used by E-Commerce businesses in Thailand. Internet strategy
covers information richness, relational exchange and joint-learning strategy. Outcomes
were measured by a company’s competitive advantage, marketing effectiveness and
firm performance. Factors that affected the outcomes were hypothesized as moderators
which included; environmental dynamism, competitive intensity and information
technology. Environmental dynamism is “the degree and instability of change in
a firm’s environment (Li and Ye, 1999); competitive intensity is a situation
where competition is fierce due to the number of competitors in the market and
the lack of potential opportunities for further growth (Auh and Menguc, 2005).”
The data provided by this research shows how a company’s
success or failure can be based upon how they do business online. Each factor
has a specific affect on each outcome which ultimately helps or hurts the
company.
Research was based on hypothesis testing gathered on 322
E-Commerce Businesses in Thailand. There were a total of 11 hypotheses that
were tested. An example of one of the hypothesis is as follows:
Hypothesis 3a: Competitive advantage gas a positive influence on
marketing effectiveness
Hypothesis 3b: Competitive advantage has a positive influence on firm
performance
Data collected supports the hypotheses listed above. Each
hypothesis has a descriptive statistics table and correlation matrix to support
or deny it. The results show that information richness, relational exchange and
joint-learning strategy positively affect on competitive advantage and firm
performance. Marketing effectiveness positively affects firm performance and IT
competency positively influences joint-learning strategy.
The information found through this testing can help management
understand the relationship among each factor. They can better utilize company
resources to enhance competitive advantage, marketing effectiveness and firm
performance.
Ussahawanitchakit P, Intakhan P. INTERNET STRATEGY
OF E-COMMERCE BUSINESSES IN THAILAND. International Journal Of Business
Strategy [serial online]. March 2011;11(1):47-66. Available from: Business
Source Complete, Ipswich, MA. Accessed June 26, 2012.
Auh, Seigyoung and Menguc, Bulent. 2005. Balancing
Exploration and Exploitation: The Moderating Role of Competitive Intensity.
Journal of Business Research, 58: 1652-1661.
Li, Mingfang and Ye, L. Richard. 1999. Information
Technology and Firm Performance: Linking with Environmental, Strategic, and
Managerial Contexts. Information and Management, 35: 43-51.
I have seen from a first hand point of view that a business has trouble running anymore without a website, or online commerce. I have worked at a gas grill/propane place off and on for years. Since I first started there the boss has been saying he was going to get a website going. It has been nearly 9 years and still no website. Lately with the decline in the economy he has seen a decline in sales and profitability in his business where-as another friend of mine also in the grill business (but purely online business) has seen increases in sales while doing almost zero work.
ReplyDeleteI think having a website, using your competitive advantage, wether its by price, individuality, or features keeps people in the organization in the right path towards a goal of profits. Back to the grill business, The grill store (physical store) has hah the same products, and nearly the same prices for years. They do not offer sales or incentives to their sales staff. Because of this the sales people have no reason to try to sell anything because its much easier to just sit and watch TV instead of getting a huge grill box out of the warehouse, loading it in a customers vehicle, filling out all the paperwork, asking the million questions, scheduling the installation and anything else that may go along with the sale. Why would anyone in their right might want to force themselves to do MORE work with no possible reward in site??? I think they would, I know I wouldnt.
I currently work for my own company. I started a home based glass blowing company about 3 years ago. I am currently the only person working in/for this business. I occassionally have people who want to learn the art and come apprentice but generally I am working alone. One thing I have notice is that If I just make plain jane glass stuff, noone wants it because they can buy something very similiar from China/India for 1/4 the price. I have to use the competitive advantage of my style of art, my style of manipulating the material into forms that I call art. When I make things that are my own, and not copies of others work is when the money is good and I enjoy the art of Glass blowing. That enjoyment is what drives me to continue to stand in a 120* work shop, next to a 1000* kiln while standing behind a 3300* flame. If there wasn't enjoyment and satisfaction in it for me then I wouldn't do it.
For me to get that satisfaction I must use a competitive advantage. For people to use that C.A. for the firm they must actually believe in the product/firm and not just be there to warm a chair for 40 hours a week.
E-commerce in todays world is a very important factor to the success of a business in my opinion. I agree completely with Russell in the sense that not having a web site in this day and age can greatly hurt a company's profits from an e-commerece stand point. A company that supports e-commerce has a competitive advantage over actual stores because it allows potential customers to shop from the comfort of their own home.
ReplyDeleteAt this point in the business game, not having any sort of internet access for customers to view information about your company is not wise at all. First off people like to investigate before making purchases or business decisions, also they like to be able to do it on their own time. With a website, the customer can shop, research, or browse at any hour of the day or night. With mostly all businesses being affected by the economy, why lose income from a simple thing as not having a website. It may take a little work to construct the website but it would be well worth it in the end.
ReplyDeleteE-commerce definately is very important in a business today. I, for example, hold a real estate brokers' liscense. I would have no sales without the internet which is what we use to market homes, land, rentals, etc.. I have tried to market in other ways but have failed to sell anything. Almost 90% of all my customers surf the net for home shopping as well as many other things.
ReplyDeleteIt is interesting to know that several of you have your own businesses and use the internet as a part of your success. No matter how big or small a business is it is vital to have knowledge of information technology. Time is a huge factor in competitive advantage and being able to connect with customers and suppliers can speed up sales and production which increases revenue.
ReplyDeleteThese results make sense. In ecommerce, advertising, selling, and transactions are done via websites usually without personal communication. Therefore, it makes since that the factors used to measure internet strategy will lead to a positive relationship between both competitive advantage and market effectiveness, and competitive advantage and firm performance. Information richness and relational exchange, both factors of internet strategy, are essential in communicating with buyers via websites. Having a competitive advantage in either one of these measures will increase sales (which should increase firm performance) and the number of buyers (which should increase market effectiveness).
ReplyDeleteHaving a website for your company is only going to help you. I myself spend a lot of time on company websites. I have used them to purchase items, read information about the company and to apply for jobs. People spend so much time on the internet these days. Just look at how many businesses have a Facebook these days. For some businesses this is replacing their website and provides the same benefits plus advertising.
ReplyDelete