Strategic focus through e-commerce-based operations and performance of e-commerce businesses in Thailand.

AuthorChailom, Peerawat
PositionReport - Survey
  1. INTRODUCTION

    Recently, trend of e-commerce is increasing in the business of e-commerce aiming to reach wider market and faster doing non-stop in business. E-commerce is very important to business of all types in globalization era, and it orientates to the online merchant. Additionally, there is the possible increasing direct trade channels and tremendous amount of market or in the online world. However, economic conditions worldwide are facing problems online trading, online business is still continuing a growth rate (Zhu, Kraemer and Xu, 2003). comScore, Inc. have year's survey in 2007 found that market in the United States through online sales was up to 1.23 billion. For information from the Thailand National Statistical Office found that the online trade in 2007 was worth up to 305,159 million baht, with the rate of growth from the year 2006, which had sales approximately 220,924 million baht, representing 40%. National Electronics and Computer Technology Center (NECTEC) of Thailand that has the internet user behavior survey in year 2008 showed that most people used the internet to purchase a total of 45.9% from the website online which increases from the year 2007 which found only 28.9%. The data show that the behavior of internet users tends to make an online purchase more.

    E-commerce is based on operations including web portal, travel sites, e-tailers, and providers of financial and information service. Today, the business to consumer commerce (B2C) or online retailer is the most popular and growing up (Chen and Tan, 2004). For the online retailer such as amazon.com, ebay.com, barneandnoble.com etc., the websites recognized internationally have many customers. These businesses attempt to take advantage of low operating costs, select channels and specific target (Hoffman, Novak, 1997). As well as, introducing new products and customer support enhance selling opportunities (Chang, Jackson and Grover, 2003). It also can provide details of real-time information with customers of the business (Golicic, Davis McCarthy and Mentzer, 2001). Moreover, globalization and information computer technology are radically changing the face of business. Organization, which used to support more convenient, fast transaction, makes users feel safety (Ngai and Wat, 2002). Therefore, operators should focus on infrastructure related to services, including the internet, payment system and delivery systems (Grover and Saeed, 2004). This study focuses on B2C e-commerce. Therefore, e-commerce is defined as selling of goods and services for online customers. In previous e-commerce literature, the specifications of online strategy have requirement to be successful (Grover and Saeed, 2004). The strategy of online trading such as the marketing orientation by focusing on the sale of goods or services is interesting. Besides, analysis of market demand and competitors affects the success of online business firm (Chang, Jackson and Grover, 2003). Thus, strategic focus through e-commerce-based operations reflects the probability of firm performance and success. The strategic focus through e-commerce-based operations has four components: e-market orientation, advanced technology learning, supply chain intensity and entrepreneurial concentrate.

    E-commerce performance refers to the outcome of e-business's activity or operations. Prior researches have studied e-commerce performance from different perspective, which includes six types of indicators, namely, systems quality, information quality, service quality, utilizes, user satisfaction, and benefit (Delone and McLean, 2004). Furthermore, past researches have thirteen indicators variables used to measure firm performance. They are business image, market share, marketing cost, sale cost, new market, sales revenue, new service, customer service, customer satisfaction, customer royalty, and company's value (Madeja and Schoder, 2003). The prior e-commerce research found in the field of information technology that focuses on infrastructure, implementation process (Kim, 2002) critical factors make a business successful (Huang, Zhao and Li, 2007). However, e-commerce researches in business management are not many. Moreover, they vary in strategies used in the e-business model and about how to be successful (Subramani and Walden, 2001). In addition, many of e-businesses firms have problems operating and without profitability (Mullaney, 2001) having the poor customer service, poor order fulfillment inadequate technology infrastructure and channel conflict (Krovi, 2001) and threat from new competitors worldwide. Thus, the strategic focus through e-commerce-based operations is the critical factor for firm performance. This study investigates the effects of strategic focus through e-commerce-based operations on e-commerce performance. The results of this study can be used to improve the performance of e-commerce firms and provide implications for e-commerce practices to Thailand e-commerce business.

    The purposes of this study are (1) to study the relationship between strategic focus through e-commerce-based operations and performance (2) to investigate the mediating effects of customer responsiveness and customer acceptance in the strategic focus through e-commerce-based operations--e-commerce performance relationships. (3) to examine the relationship between strategic focus through e-commerce-based operations on customer acceptance and customer responsive by using competitive environment and technology turbulence as moderators (4) to examine the relationship between information technology experience, customer awareness, competitive knowledge and market need for internet-based service on strategic focus through e-commerce-based operations. The primary research question of this dissertation is how the relationship between strategic focus through e-commerce-based operations on performance. In addition, the specific research questions of this dissertation are as follows: (1) how customer acceptance and customer responsive mediate the relationship between strategic focus through e-commerce-based operations and performance. (2) How do competitive environment and technology turbulence moderate the strategic focus through e-commerce-based operations--customer responsiveness relationships and the strategic focus through e-commerce-based operations--customer acceptance relationship? (3) How do information technology experience, customer awareness, competitive knowledge and market need for internet-based service affect strategic focus through e-commerce-based operations?

    The remainder of this study is organized as follows. Firstly, the relevant literature and the theoretical framework are reviewed to describe the conceptual model and develop the related hypotheses for testing. Secondly, the research methods including sample and data collection procedure, the variable measurements of each construct, the instrumental verification, the statistics, and equations to test the hypotheses are provided. Thirdly, the empirical results and discussion are demonstrated. Finally, the theoretical, practical, and institutional implications, limitation and suggestions for future research, and conclusion are discussed.

  2. THEORETICAL FOUNDATION

    This study utilizes two theories viz contingency and knowledge-based view (KBV) to explain the constructs relationship. The contingency theory applied in the E-Commerce performance depends on the specific contingency variables (e.g. competitive environment and technology turbulence) appropriate and conform with strategic focus through E-Commerce-based operations (O'Connor, 1995). In addition, the structural contingency theory attempts to describe the relationships between the external condition and structure of strategic focus through E-Commerce-based operations and performance (Miles, Covin and Heeley, 2000).

    Otherworldly, the knowledge-based view (KBV) is the theory that used to support the context of this study. The knowledge-based theory of the firm considers knowledge as the resources that are usually difficult to imitate, heterogeneous knowledge bases and capabilities among firms are the crucial determinants of competitive advantage and performance (Teece, 1998). Therefore, this perspective can assume that information technology experience, customer awareness, competitive knowledge, and market need Internet-based service to determine a performance while they help the firm to generate firms strategic that leads to competitive advantage and performance (Kogut and Zander, 1992).

  3. LITRERATURE REVIEW AND THEORETICAL DEVELOPMEMT

    Based on literature reviews and theoretical framework, this study purposes that strategic focus through e-commerce-based operations has positive effect with e-commerce performance. Moreover, the effects of strategic focus through e-commerce-based operations on customer responsiveness and customer acceptance by using competitive environment and technology turbulence as moderators are investigated. Additionally, the mediating effects of customer responsiveness and customer acceptance are examined. Lastly, this study assumes that information technology experience, customer awareness, competitive knowledge and market need for internet-based service have positive relationship with strategic focus through e-commerce-based operations. Accordingly, a conceptual model of this study is shown in Figure 1.

    [FIGURE 1 OMITTED]

    3.1 Strategic Focus through E-Commerce-Based Operations

    Strategic focus through c-commerce-based operations refers to strategic orientation, strategic intensity, business strategy and corporate strategy. Strategic orientation concept is defined as a firm's strategic direction in creating proper behaviors to achieve superior performance (Gatignon and Xuereb, 1997). This study, strategic focus through c-commerce-based operations, is referred interchangeably with strategic orientation. Strategic orientation consists of customer, competitor and...

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