The bases of successful market entry: The liability of size and of newness in E‐commerce |
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| Authors: | Thomas Ehrmann Florian Haas Rainer Harms |
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| Institution: | 1. Professor for Business Administration , University of Muenster , Germany E-mail: ehrmann@ug.uni‐muenster.de;2. Research assistant within the PhD. program at the faculty of Business Administration , University of Muenster , Germany E-mail: haas@ug.uni‐muenster.de;3. Research assistant within the Fh.D. program at the faculty of Business Administration , University of Muenster , Germany E-mail: harms@ug.uni‐muensterde |
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| Abstract: | Abstract Even though e‐commerce almost disappeared from public discussion, it still assumes a vital role in the strategic management of most enterprises. New entry in e‐commerce, whether as a new business segment of an established company or as a new enterprise, is likely to deal with the liabilities of size and newness. The aim of this paper it to discuss if those factors have an impact on the implementation and success of B2C e‐commerce. We chose the online book market as our reference market and drew a random sample of retailers and publishers with an online shop. The quality of the web presence, indirect success (number of links to a particular site) and direct success (turnover of the web shop) were compared in subsamples constructed by the use of median splits according to age and size. Younger companies and larger companies were found to have a web presence of higher quality and were more successful than older or smaller companies. We conclude that the liabilities of newness do not seem to have an adverse performance impact in e‐commerce. However, when a market entry is considered, new players must ensure that they can commit enough resources to build a high quality web presence. |
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