Abstract

The emergence of the online Business-to-Business (B2B) marketplace, such as Alibaba.com and ECVV.com, has presented a huge opportunity for Small-and-Medium Enterprises (SMEs) to reach out to a wide pool of potential corporate customers, which is unlikely to be gotten at such magnitude (if not, too costly) through conventional means, such as participating in trade-fairs and roadshows. Notwithstanding the touted opportunity, SMEs often may not be able to realize such benefit. To this end, SMEs have to make decision on whether to continue “paying” to the B2B marketplace operator in exchanging for such presence. Building on the real option theory, this study seeks to depict such a decisional situation by proposing and validating a set of factors, which could potentially influence a SME’s decision to continue (or give up) adopting the B2B marketplace. Results from a survey involving 74 SMEs reveal that the perceived flexibility in such investment significantly affects the perceived real option value, which in turn affects a SME’s inclination to continue adopting the B2B marketplace for the presence.

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Understanding Factors Influencing a SME to Continue Adopting the B2B Marketplace to Maintain its Presence

The emergence of the online Business-to-Business (B2B) marketplace, such as Alibaba.com and ECVV.com, has presented a huge opportunity for Small-and-Medium Enterprises (SMEs) to reach out to a wide pool of potential corporate customers, which is unlikely to be gotten at such magnitude (if not, too costly) through conventional means, such as participating in trade-fairs and roadshows. Notwithstanding the touted opportunity, SMEs often may not be able to realize such benefit. To this end, SMEs have to make decision on whether to continue “paying” to the B2B marketplace operator in exchanging for such presence. Building on the real option theory, this study seeks to depict such a decisional situation by proposing and validating a set of factors, which could potentially influence a SME’s decision to continue (or give up) adopting the B2B marketplace. Results from a survey involving 74 SMEs reveal that the perceived flexibility in such investment significantly affects the perceived real option value, which in turn affects a SME’s inclination to continue adopting the B2B marketplace for the presence.