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How commitment and platform adoption drive the e-commerce performance of SMEs: A mixed-method inquiry into e-commerce affordances

Ballerini, Jacopo

Abstract

To cope with the digital transition exacerbated by the COVID-19 pandemic, managers of manufacturing small and medium enterprises (SMEs) need to adopt innovative practices to face uncertain scenarios and create long-term value, identified as transformational entrepreneurship practices. Among emerging digital technologies, digital platforms are shaping and outgrowing the e-commerce channel representing a potential opportunity for manufacturing SMEs to embrace digital transformation. Drawing on affordance theory, this research uses a mixed method approach to investigate how manufacturing SMEs’ e-commerce commitment and digital platform adoption stimulate the actualization of three e-commerce affordances: consumer knowledge generation, internationalization, and customer diversification. Based on survey responses from 165 manufacturing SME managers, we find that direct selling through owned websites actualizes consumer knowledge generation and internationalization, indirect selling actualizes customer diversification and internationalization, and agency selling through third-party platforms actualizes all three affordances. The relationship between e-commerce commitment and ecommerce performance is mediated by consumer knowledge generation and internationalization but not by customer diversification. A fsQCA analysis outlines seven configurations actualizing these e-commerce affordances by pairing different ecommerce approaches with degrees of e-commerce commitment. Finally, an analysis of open-ended questions from 24 respondents complements the study and deeply interprets the seven unique configurations outlined.

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International Journal of Information Management 72 (2023) 102649 Available online 14 April 2023 0268-4012/© 2023 The Authors. Published by Elsevier Ltd. This is an open access article under the CC BY license (http://creativecommons.org/licenses/by/4.0/). How commitment and platform adoption drive the e-commerce performance of SMEs: A mixed-method inquiry into e-commerce affordances Jacopo Ballerini a , b , * , Dennis Herhausen b , Alberto Ferraris a , c , d a University of Turin, Turin, Italy b Vrije Universiteit Amsterdam, Amsterdam, the Netherlands c Laboratory for International and Regional Economics, Graduate School of Economics and Management, Ural Federal University, Russia d Department of Industrial Systems Management, Faculty of Materials Science and Technology, VSB-Technical University of Ostrava, 17. listopadu 2172/15, 708 00 Ostrava, Czech Republic ARTICLE INFO Keywords: Affordance theory Transformational entrepreneurship Digital platforms e-commerce fsQCA mixed method ABSTRACT To cope with the digital transition exacerbated by the COVID-19 pandemic, managers of manufacturing small and medium enterprises (SMEs) need to adopt innovative practices to face uncertain scenarios and create longterm value, identified as transformational entrepreneurship practices. Among emerging digital technologies, digital platforms are shaping and outgrowing the e-commerce channel representing a potential opportunity for manufacturing SMEs to embrace digital transformation. Drawing on affordance theory, this research uses a mixed method approach to investigate how manufacturing SMEs’ e-commerce commitment and digital platform adoption stimulate the actualization of three e-commerce affordances: consumer knowledge generation, internationalization, and customer diversification. Based on survey responses from 165 manufacturing SME managers, we find that direct selling through owned websites actualizes consumer knowledge generation and internationalization, indirect selling actualizes customer diversification and internationalization, and agency selling through third-party platforms actualizes all three affordances. The relationship between e-commerce commitment and ecommerce performance is mediated by consumer knowledge generation and internationalization but not by customer diversification. A fsQCA analysis outlines seven configurations actualizing these ecommerce affordances by pairing different ecommerce approaches with degrees of e-commerce commitment. Finally, an analysis of open-ended questions from 24 respondents complements the study and deeply interprets the seven unique configurations outlined. 1. Introduction Alongside provoking a social and economic crisis, the COVID-19 pandemic has shifted consumers’ buying habits by increasingly nudging them toward online purchases (V´ azquez-Martínez et al., 2021). Thus, all companies, regardless of their size and heritage, need to adopt and exploit new digital opportunities to address this changing behavior and the great challenges posed by this volatile and uncertain post-pandemic market scenario (Dwivedi et al., 2020; Troise et al., 2022). Digital entrepreneurs undoubtedly have opportunities to create new digitally native business models adapted to the changing needs of consumers (Nambisan, 2017). More intimidating, however, is the digital transformation for small and medium enterprises (SMEs) 1 which manufacture physical goods. To best cope with this transition, SME managers must be ready for change and implement transformational entrepreneurship practices, defined as innovative entrepreneurial practices adopted to face uncertain crisis scenarios and create long-term value for a firm and its community (Maas & Jones, 2019; Schoar, 2010). Among the emerging technologies shaping the entrepreneurial landscape, digital platforms play a prominent role (Sutherland & Jarrahi, 2018; Troise et al., 2020). E-commerce is one of the sectors impacted mainly by the evolution of digital platforms. For instance, * Correspondence to: University of Turin, Turin, Italy; Vrije Universiteit Amsterdam, Amsterdam, the Netherlands. E-mail addresses: [email protected], [email protected] (J. Ballerini), [email protected] (D. Herhausen), [email protected] (A. Ferraris). 1 In accordance with the European Commission (2020), we define SMEs as enterprises employing fewer than 250 persons which have an annual turnover not exceeding EUR 50 million and/or an annual balance sheet not surpassing EUR 43 million. Contents lists available at ScienceDirect International Journal of Information Management journal homepage: www.elsevier.com/locate/ijinfomgt https://doi.org/10.1016/j.ijinfomgt.2023.102649 Received 29 June 2022; Received in revised form 27 March 2023; Accepted 2 April 2023 International Journal of Information Management 72 (2023) 102649 2 Amazon Marketplace, which connects manufacturers with end consumers, has continued to grow by an average of 35% every quarter since 2017 (Amazon, 2022), and the software-as-a-service platform Shopify has increased its turnover in the last five years more than tenfold, reaching almost 3 billion dollars in 2020 (Shopify, 2021). The evolution of these platforms has favored the emergence of newer approaches to online sales as opposed to the traditional indirect selling approach in which a SME manufacturer sells to an e-commerce reseller (whether a pure player or an omnichannel retailer), who then resells to the end consumer in a conventional business-to-business-to-consumer (B2B2C) dynamic (C. Chen et al., 2021). In particular, third-party e-commerce platforms such as Amazon Marketplace, eBay or Alibaba are increasingly gaining consideration within the online commerce marketplace, prompting SME manufacturers to adopt the so-called agency selling approach, in which the manufacturer relies on these third-party multi-- sided platforms and sells directly to its end consumers via its platform account (Pu et al., 2020). The direct selling approach, in which manufacturers directly sell to end consumers through their website, is also undergoing a radical change thanks to lower development and administration costs, as well as reduced technical knowledge barriers. Although digital platforms have contributed to developing new approaches to e-commerce, it is still unclear which method is most desirable for SME managers who want to embrace transformational entrepreneurship practices. To address this gap, recent research has used affordance theory to identify which affordances are actualized by e-commerce providers (Bayer et al., 2021; S. (Joseph) Chen & Tamilmani, Tran et al., 2022; Lehrer et al., 2018). In this regard, the emphasis has been often on consumers’ perceptions, identifying affordances such as the possibility of: (a) breaking down the asymmetry of product information, (b) completing electronic transactions without leaving home, (c) having more choice options, or (d) sharing opinions on products (Bayer et al., 2021; Shao & Pan, 2019; Sun et al., 2019; Wang, Luo et al., 2022). Interestingly, less is known regarding how e-commerce enables transformational entrepreneurship for SME manufacturers. However, it is acknowledged that e-commerce, beyond possibly increasing sales, can be a driving force for firms’ to increase their knowledge of consumers, speed up their internationalization, and find additional sources of revenue (Akter & Wamba, 2016; Elia et al., 2021; Marconatto et al., 2021). Thus, managers wishing to implement transformational entrepreneurship practices leveraging on e-commerce should first ensure the organization commits to this type of deployment with e-commerce commitment, defined as the management’s resource investment and explicit attribution of prominence communicated to employees concerning e-commerce (Kowtha & Choon, 2001). Indeed, it is not sufficient to merely use an e-commerce platform to increase sales. Without a proper understanding of the applied technologies, companies risk being ineffective and diminishing their financial performance (Abebe, 2014; Yang et al., 2015). However, the literature has not yet focused on understanding whether the e-commerce approaches used by manufacturing SMEs are more or less suitable for fostering the different types of affordances that e-commerce can provide (Ballerini et al., 2023). Moreover, it is unclear how much effort entrepreneurs need to put into ensuring the success of their e-commerce strategy according to the various methods and platforms adopted. Drawing on affordance theory, this research identifies three affordances that SME managers can actualize: consumer knowledge generation, internationalization, and customer diversification. This research aims to evaluate the role played by both the different e-commerce approaches and the level of e-commerce commitment in actualizing these affordances. Thus, this research outlines which combination of approaches and e-commerce commitment leads SME managers embracing transformational entrepreneurship practices to actualize e-commerce affordances. Therefore, the ultimate purpose of this paper is to highlight what combinations of e-commerce commitment and approaches are best suited for managers embracing transformational entrepreneurship practices to pursue the different strategic goals that e-commerce potentially affords. Accordingly, this study evaluates whether with the actualization of the respective affordances the managers attribute a high performance level to e-commerce. This research adopts a mixed-method exploratory design. First, it conducts a structured equation modeling (SEM) quantitative analysis. Afterward, it produces a fuzzy-set qualitative comparative analysis (fsQCA) followed by the review of open questions from selected manufacturing SMEs’ managers. The findings outline seven possible configurations of affordance actualization by pairing different e-commerce approaches and degrees of e-commerce commitment. Moreover, this research highlights how the actualization of internationalization and consumer knowledge generation affordances mediates the e-commerce commitment and performance relationship. 2. Literature review 2.1. Transformational entrepreneurship and digital platforms Schoar (2010) distinguishes between subsistence and transformational entrepreneurship. The first form involves small businesses intended to support the owner and their few employees. Transformational entrepreneurship businesses aim to create economic and social value for their community (Maas & Jones, 2019). However, transformational entrepreneurship depends on context, making it “hard to define” (Ratten, 2022, p. 2). Although clear distinctions remain between subsistence and transformational entrepreneurship, the latter is multifaceted, affecting social, political, and economic domains, and multilayered, affecting individuals, firms, and communities (Virmani & L´ epineux, 2016). Some studies have focused on the social impact of transformational entrepreneurship. For instance, it can encourage women’s empowerment (Okeke-Uzodike, 2019) and boost developing nations’ and local communities’ economies (Egere et al., 2022). Beck (2013) has investigated how targeted funding can promote and incentivize transformational entrepreneurship. However, public administration and credit institutions still struggle to identify transformational entrepreneurship-oriented activities. When confronted with long-term challenges, transformational entrepreneurs exhibit innovative tendencies and proactivity in adopting new business models and technologies (Marmer, 2012). Thus, we define transformational entrepreneurship as innovative entrepreneurial practices that counter uncertainty and create long-term value. Not surprisingly, transformational entrepreneurship has been accompanied by digital entrepreneurship, which digitalizes, in whole or part, company operations previously performed by individuals (Kraus et al., 2018). More specifically, digital entrepreneurship is based on the idea that the properties of digital technology will shape entrepreneurial behavior (Nambisan, 2017). Furthermore, transformational entrepreneurship necessitates change, which requires workers to learn new skills and entrepreneurs to invest in staff development (Dicuonzo et al., 2022). In addition, corporate digitalization demands a receptive company culture (Ciampi et al., 2022). Therefore, transformational entrepreneurship fits new digital technologies comparably to digitally native businesses and digital entrepreneurs. Digital platforms are notable among new digital technologies. Information systems (IS) researchers describe them as “the extensible codebase of a software-based system that provides core functionality shared by the modules that interoperate with it and the interfaces through which they interoperate” (Tiwana et al., 2010, p. 676). Economists define platforms as products, services, or firms that mediate transactions between two or more groups of agents (Baldwin & Woodard, 2009, p. 22). Thus, digital platforms are software-based systems, products, and services that facilitate transactions between parties. However, digital platforms enable more than simply economic transactions. They can build and deepen consumer-vendor relationships, yielding valuable insights and new ideas (Dutot & Van Horne, 2015). In J. Ballerini et al. International Journal of Information Management 72 (2023) 102649 3 addition, digital technologies enable rapid change response, which is crucial for companies in an unpredictable environment (Nambisan et al., 2017). The COVID-19 pandemic has forced many companies to digitize and reorganize labor through digital platforms (Dwivedi et al., 2020). Post-pandemic businesses must adapt to new forms of commerce and customer demands. Transformational entrepreneurship practices help non-digital firms create value by leveraging e-commerce digital platforms (Dicuonzo et al., 2022; Ratten, 2022). Ratten’s (2022) qualitative inquiry shows how some Australian agricultural manufacturers used a local online marketplace during the pandemic and achieved satisfactory results as well as developing a greater interest and predisposition toward digital platforms, increasing their transformational entrepreneurship attitude. The case study on transformational entrepreneurship practices by Dicuonzo et al. (2022) claims that the company’s strong commitment to its e-commerce platform, amplified after the pandemic, led to a significant increase in turnover through a scale-up in international markets. Although current research has examined entrepreneurial and SMEs’ use of digital platforms for social purposes (Amaral & Orsato, 2022; Troise et al., 2020), transformational entrepreneurship practices related to digital platforms remain understudied. Moreover, Ratten (2022) has highlighted the need to comprehend the attention that transformational entrepreneurs transfer or communicate to their employees regarding digital platforms. In addition, digital platforms for online commerce may affect transformational entrepreneurship, but little research has been conducted on this topic. 2.2. E-commerce affordances The literature review reveals that transformational entrepreneurs are often characterized by a keen intuition for the use of new technologies (Virmani & L´ epineux, 2016). Ratten’s (2022) discussion of how transformational entrepreneurs venturing into exploiting new digital platforms gradually succeed in embedding them at the center of their strategy and fully profiting from them is particularly salient. These typical traits of transformational entrepreneurs draw a certain parallel with affordance theory. The affordance lens has been used by IS scholars to examine how technologies affect organizational design and performance (Strong et al., 2014; Zammuto et al., 2007). The term affordance was introduced by Gibson’s work on the psychology of perceptions in the late 1970s (Gibson, 1979). According to this theory, subjects evaluate and apprehend objects in their environment in terms of their capacity for action, or affordance. Thus, the term affordance describes the relationship between the actor trait and a specific object trait (Chemero, 2003). The IS affordance perspective holds that technology enables interactions between organizations, entities, processors, facilities, systems, and objectives. Affordance is actualized when the actor recognizes a specific action in the object or technology. The actor’s presence is necessary for the affordance to exist, yet it can still be potential (Strong et al., 2014). Thus, a technological item may have many affordances, but only some of these can be actualized. Therefore, associating transformational entrepreneurship practices as behaviors conducive to the actualization of different affordances toward a specific technology would not be improper. Affordance theory has been applied to e-commerce platforms in recent literature (Bayer et al., 2021), especially from a consumer perspective. For instance, Bayer et al. (2021) has reviewed online shopping studies and reinterpreted them from an affordance perspective, identifying seven key consumer-related e-commerce affordances: electronic transactions, temporal interdependence, online platforms, information transparency, and social interactions, as well as tailored and proactive services. Among these, one of the most studied affordances is social interaction. Works on online social platforms like WeChat or e-commerce platforms like Taobao identify interactive or dynamic shopping-experience characteristics, including metavoicing, social networking, and parasocial information (Dong & Wang, 2018; Sun et al., 2019; Wang, Luo et al., 2022). According to Shao and Pan (2019), media richness and interactivity promote social interaction affordance and, thus, online social platform user participation. Information transparency also relates to Bayer et al.’s (2021) analysis of social interaction affordance. Specifically, e-commerce platforms encourage visibility, direction, and bullet information affordances (Sun et al., 2019; Wang, Luo et al., 2022). The visibility affordance arises from product information and photographs. Therefore, it may fall under information transparency, while guiding information and bullet information, which allude to other users’ reviews of the product or the streamer’s explanations, overlap with social interaction affordance. Lehrer et al. (2018) take a different stance, focusing on the affordances that organizations might actualize by employing big data analytics. Specifically, using business e-commerce platform functionalities helps promote service innovation. De Luca et al. (2021) also conclude that big data affordances drive service innovation. Another concrete example of service innovation is virtual reality, which affords online shoppers to virtually try on garments, leading to a greater intention to buy (Tawira & Ivanov, 2022). However, firm-focused affordance research on e-commerce platforms is scarce. Few managerial e-commerce affordances have been identified in the literature, and assessing what corporate decisions and processes contribute to affordance actualization remains an unresolved challenge (De Luca et al., 2021). 3. Hypotheses and research model In line with affordance theory, we define e-commerce affordances as actualizable possibilities of performing specific strategic actions offered by the e-commerce channel. As affordance theory suggests, affordances are relational (Chemero, 2003). Their nature is not in the features of an object (e-commerce channel) nor the subject (firms), but arises from the relationship between the ability of the latter to understand the object’s features for strategic-oriented actions (Strong et al., 2014; Zammuto et al., 2007). Although an object may potentially embed various affordances, these are not necessarily perceived and actualized in the same way by all firms. As transformational entrepreneurs need to embrace change based on new technologies to gain long-term success, it is in their interest to be in the condition of actualizing all the affordances that technologies can potentially imply. Therefore, when bringing this theoretical rationale into the e-commerce channel context, it is critical to identify what induces firms, managers, and transformational entrepreneurs to actualize different e-commerce affordances. In particular, in line with Bayer et al. (2021), this study approaches the literature inherent to e-commerce for manufacturing SMEs and envisions affordances for its framework. 3.1. E-commerce commitment and e-commerce affordances Nowadays, market knowledge is considered critical for every firm. Moreover, there is evidence that market-oriented companies have higher profits and revenues than their competitors, and historical records show they have a higher chance of preventing business failure (Kumar et al., 2011). Furthermore, Reijonen et al. (2012) infer that market-oriented SMEs tend to grow more than others. Therefore, manufacturers’ strategic priority should be to acquire market and consumer information and use it for different purposes, from new product development (Zhan et al., 2018) to personalized marketing activities (Kaptein & Parvinen, 2015). In this regard, e-commerce websites provide access to an enormous variety of structured and unstructured data (Akter & Wamba, 2016; Plessis & Boon, 2004). These data are a valuable resource for acquiring market knowledge and accurate information on consumer trends (De Luca et al., 2021; Lehrer et al., 2018). According to Dicuonzo et al.’s (2022) case study on transformational entrepreneurship practices, the examined organization made its website a source of information about its consumer base. Consumer knowledge generation is thus conceptualized as a strategic affordance actualizable through J. Ballerini et al. International Journal of Information Management 72 (2023) 102649 4 e-commerce commitment: H1a. : E-commerce commitment is positively related to the actualization of the consumer knowledge generation affordance. Although it is not necessary or immediately beneficial, but somewhat dependent on the maturity and vision of each specific company (Kuivalainen et al., 2012), internationalization remains a crucial success factor that has characterized the last two decades of the global economy. Transformational entrepreneurs have exploited technology to compete in the international environment while also taking advantage of their international presence by discovering new foreign technologies (Ngo & Igwe, 2019). Thus, there is a generalized consensus that SMEs with transformational entrepreneurship orientation must invest resources in their internationalization. Furthermore, effective online channel management is considered an efficient vehicle of internationalization for SMEs, since it enables them to break down new market entry costs (Hossain et al., 2021; Raymond et al., 2005). Therefore, it is conceivable that the more a company commits to the e-commerce employment, the more it should be able to actualize the potential affordance it can bring in terms of internationalization. H1b. : E-commerce commitment is positively related to the actualization of the internationalization affordance. Normally, SME manufacturers should avoid depending on a reduced number of customers. Customer concentration can lead to cash flow and stock price problems if a large customer does not pay or stops contracting the manufacturer as a supplier (Lee et al., 2020). In particular, SMEs highly exposed to business-to-business (B2B) customer dependency are at risk because they typically have few large customers. Especially during economic crises like the one recently generated by the COVID-19 pandemic, SMEs with more chances to survive are the ones with the most extensive B2B customer portfolios (Marconatto et al., 2021). Creating a new distribution channel can mitigate the risk of customer dependency (Manral & Harrigan, 2018). Selling online could represent a viable new channel opening leading to an increase in customer diversification and could be interpreted as a viable transformational entrepreneurship practice to prevent or face crises. Therefore, customer diversification is a strategic affordance actualizable through e-commerce commitment: H1c. : E-commerce commitment is positively related to the actualization of customer diversification affordance. 3.2. E-commerce affordances and e-commerce performance According to affordance theory, a highly actualized affordance will induce the subject to attribute a great relevance to the object. For example, De Luca et al. (2021) point out how the actualization of big data technology affordances lead to an increase in service innovation, and consequently to increased performance with respect to the use of these tools. In other words, as managers become more aware of the utilities of the features provided by big data tools, so their usage becomes more performative. Accordingly, in this context we define e-commerce performance as the degree of efficacy that SMEs managers ascribe to their firms’ deployment of an e-commerce channel. Considering consumer knowledge generation, the big data tools generating big data affordances that are mentioned by Lehrer et al. (2018) include Google Analytics. Apart from Google Analytics, the online channel offers many solutions enabling data acquisition via e-commerce. Even major third-party platforms such as Alibaba provide user-friendly dashboards and reports highlighting consumers data to their vendors (Li et al., 2018). Therefore, if managers behaving as transformational entrepreneurs were able to actualize the possibility of acquiring data about their consumers, they could effectively use such information to their advantage by adapting their services and marketing investments in order to wisely attract and satisfy their clientele. Thus, it is consistent to assume that managers who are effectively benefiting from consumer knowledge generation would attribute a satisfactory performance level to e-commerce: H2a. Actualizing the consumer knowledge generation affordance is positively related to e-commerce performance. With regard to internationalization, Dicuonzo et al. (2022) mention how the transformational entrepreneurs who focused on their e-commerce adoption in response to the COVID-19 crisis attributed an improved internationalization effect to their online channel implementation. Conveniently, Elia et al. (2021) support that firms investing in e-commerce by hiring an e-commerce manager, for example, achieve better export performance than firms selling mainly through traditional channels, albeit with an export manager. It is therefore logical to assume that the higher the level of internationalization affordance actualization by SME manufacturers, the greater the benefit and success they ascribe to their e-commerce strategy. Therefore: H2b. Actualizing the internationalization affordance is positively related to e-commerce performance. In line with the rationale adopted for hypotheses H2a and H2b, we continue considering customer diversification an affordance that can be realized through e-commerce commitment. Besides considering diversification as a transformational entrepreneurship practice to minimize risk in times of crisis (Marconatto et al., 2021), scholars argue that diversification is a real argument for improving financial performance such as sales growth or profitability. Narasimhan and Kim’s (2002) empirical work supports how firms’ that engage new suppliers or distributors manage to minimize logistical costs, or cultural and skills barriers, thereby increasing their financial performance. If the adoption of the online channel does indeed allow for the actualization of customer diversification in the eyes of managers, they may consequently attribute an important impact on their strategy and thus on company performance to it. Therefore, we formulate the following hypothesis: H2c. : Actualizing the customer diversification affordance is positively related to e-commerce performance. 3.3. The mediating role of e-commerce affordances Although the resources that businesses deploy to embark on the ecommerce trajectory are crucial, technological resources alone are insufficient (Yang et al., 2015). Accordingly, Abebe (2014) finds that manufacturing SMEs’ entrepreneurial orientation toward adopting an e-commerce strategy is crucial to their success. Furthermore, a genuine commitment to the online channel requires that in addition to the resources invested, company executives explicitly prioritize e-commerce in the organization’s future and that this translates into concrete actions such as hiring or training qualified personnel (Kowtha & Choon, 2001). However, a frequent reason behind e-commerce management failures, attributable to non-commitment, is the lack of digital marketing and technical expertise. For example, Royle and Laing (2014) point out that companies are too often incapable of processing and interpreting information regarding their online shoppers’ consumption. Therefore, given that e-commerce commitment is an antecedent of consumer knowledge generation (H1a), which is in turn an antecedent of e-commerce performance (H2a), we expect to find that consumer knowledge generation mediates the relationship between e-commerce commitment and e-commerce performance: H3a. Actualizing the consumer knowledge generation affordance mediates the relationship between e-commerce commitment and ecommerce performance. Another cause of e-commerce failures in the internationalization context again leads to factors attributable to a lack of commitment. Tolstoy et al. (2021) highlights that only companies that put the online J. Ballerini et al. International Journal of Information Management 72 (2023) 102649 5 channel at the center of their internationalization strategy have seen satisfactory results. It is no coincidence that the initial acceleration of online sales development in target foreign markets is a determinant for the long-term retention of that channel (Deng et al., 2022). In addition, online sales are determined by service quality (Ma et al., 2022), which minimizes the perceived distance of customers to the foreign seller, and by the quality of shipping, which must be handled to the highest standard (Gregory et al., 2019). Given that e-commerce commitment is an antecedent of internationalization (H1b), which is itself an antecedent of e-commerce performance (H2b), we expect that internationalization mediates the relationship between e-commerce commitment and e-commerce performance: H3b. Actualizing the internationalization affordance mediates the relationship between e-commerce commitment and e-commerce performance. Ultimately, actualizing customer diversification through the online channel seems complicated to achieve without the necessary commitment. Managing a more significant number of accounts per se requires commitment. The prioritization of accounts is then unavoidable, especially for manufacturers with limited resources (Homburg et al., 2008). The danger is that if the necessary commitment to focus on e-commerce does not persist, accounts specialized in e-commerce distribution will risk being treated as bottom-tier accounts or simply managements will not even consider the opportunity to establish relationships with them. Therefore, a non-committed e-commerce management would not ascribe its affordance nor recognize its worthiness. Given that e-commerce commitment is an antecedent of customer diversification (H1c), which is in turn an antecedent of e-commerce performance (H2c), we expect that customer diversification mediates the relationship between e-commerce commitment and e-commerce performance: H3c. Actualizing the customer diversification affordance mediates the relationship between e-commerce commitment and e-commerce performance. 3.4. E-commerce platforms and e-commerce affordances Moreover, it is known that characteristics of the object may facilitate or hinder the subject’s actualizing of affordances (Strong et al., 2014). Indeed, there are multiple ways to approach the online channel, such as direct selling, agency selling and indirect selling (C. Chen et al., 2021; Pu et al., 2020), and we expect that specific features of different e-commerce options can favor or disfavor the actualization of the consumer knowledge generation, internationalization, and customer diversification affordances. 3.4.1. Direct selling Assuming that consumer knowledge generation is ascribable as an ecommerce-specific affordance, different approaches to the online sales channel can certainly impact it. The direct selling approach, in which a manufacturer directly sells to end consumers through their website, allows it to directly access a multitude of structured and unstructured data (Akter & Wamba, 2016). In fact, directly managing a proprietary site allows owners to handle all data accessible via Google Analytics (Lehrer et al., 2018). This permits intuitive access to the demographic nature of consumers in terms of location, age, gender, and other characteristics. Therefore, the following hypothesis can be formulated: H4a. Direct selling via an own e-commerce website is positively related to consumer knowledge generation affordance actualization. Regarding the actualization of the internationalization affordance, the rationale behind this is also that e-commerce is generally a preferred route, as it is less costly and cumbersome than traditional methods. Direct selling in this respect would be no exception. New content management system technologies nowadays allow businesses to build websites at a low cost without necessarily contracting developers and coders (Engert et al., 2022). In addition, the scalability of an e-commerce platform allows firms to reach manifold markets simultaneously by simply translating their catalogue into multiple languages. For example, an empirical study by Tolstoy et al. (2016) revealed that Swedish companies with e-commerce websites achieve a greater coverage of international markets than those without. Therefore, the following hypothesis can be formulated: H4b. Direct selling via an own e-commerce website is positively related to internationalization affordance actualization. According to the reasoning that was used for the earlier hypothesis (H1c), e-commerce commitment is the mechanism that enables the customer diversification affordance actualization. However, direct sales are not the approach that is going to be the most successful in this particular scenario. By definition, direct selling involves skipping the middlemen and going straight from the manufacturer to the end user, cutting out the distribution chain entirely. Sometimes, behavior of this nature even creates a channel conflict with the company’s distributors (Du et al., 2018; Tsay & Agrawal, 2004). Because of this, it may be inconceivable for the manufacturer to consider the possibility of using e-commerce as a weapon to broaden its portfolio of distributors, while on the other hand it could stimulate the manufacturer’s willingness to concentrate its revenue sources. Therefore, the following hypothesis can be formulated: H4c. Direct selling via an own e-commerce website is negatively related to customer diversification affordance actualization. 3.4.2. Agency selling The practice of agency selling is spreading widely with the growth of third-party marketplace platforms. Agency selling also has peculiarities that would make it suitable for actualizing the consumer knowledge generation affordance. Although agency selling may disregard the existence of a manufacturer’s website, and therefore not provide direct access to data analytics, third-party marketplaces allow for circumventing this problem. These platforms provide excellent tools to their vendors, enabling them to analyze consumer behavior thanks to their easy-to-read dashboards and reports (Li et al., 2018). In addition, they often offer accurate selling forecasts thanks to their artificial intelligence algorithms based on consumers’ purchase history (Zhang et al., 2021). Therefore, the following hypothesis can be formulated: H5a. : Agency selling via third-party platforms is positively related to consumer knowledge generation affordance actualization. In the case of the internationalization affordance as well, agency selling presents characteristics that would make it suitable for its actualization. Indeed, its presence in many markets is known to be an important lever for gaining the trust of foreign consumers through brand awareness (Maier & Wieringa, 2021). In other words, a consumer is more likely to discover a foreign manufacturer’s product on Amazon and trust buying it there, rather than becoming aware of it and deciding to purchase it directly from the manufacturer’s site. Furthermore, third-party marketplaces adopt active strategies to encourage vendors, especially SMEs, to sell internationally as well, such as offering dedicated logistics services that lower their costs and shipping (Hui, 2020). Therefore, the following hypothesis can be formulated: H5b. : Agency selling via third-party platforms is positively related to internationalization affordance actualization. In contrast to direct selling, agency selling possesses characteristics that may render it appropriate for the actualization of the customer diversification affordance. It is still the manufacturer who retains sovereignty over its products, since it remains the proprietary vendor retailing them via third-party platforms; however, it is possible that the manufacturer can sell simultaneously via more than one of these J. Ballerini et al. International Journal of Information Management 72 (2023) 102649 6 platforms. A manufacturer selling their products on Amazon might also offer them on Alibaba, eBay, and a variety of other third-party platforms, which would result in diversified revenue streams. In addition, third-party platforms work tirelessly to bring in as many different vendors as they can in order to achieve a critical mass (Johnson, 2013). Therefore, the following hypothesis can be formulated: H5c. : Agency selling via third-party platforms is positively related to customer diversification affordance actualization. 3.4.3. Indirect selling The assumption that direct selling and agency selling are more likely to facilitate the actualization of consumer knowledge generation is grounded on the premise that direct selling and agency selling enable manufacturers to have direct access to consumer demographic and purchasing data (H4a, H5a). However, this is not the case when dealing with indirect sales. A manufacturer engaging in indirect sales does not have any direct information regarding the shopping patterns of the end customers who purchase their products online. Any information the manufacturer might have comes from the resellers willing to provide it. Unfortunately, this is not always the case. In addition, resellers are frequently under the impression that they will not benefit from information sharing with suppliers unless it is done to an extremely high relational degree (Villena & Craighead, 2017). Therefore, the following hypothesis can be formulated: H6a. : Indirect selling via third-party resellers is negatively related to consumer knowledge generation affordance actualization. The logic behind the idea that direct selling and agency selling can be an effective approach when opening up new markets implies that online commerce requires less upfront investment and risks than traditional strategies (H4c, H5b). The case of indirect selling should be no exception. Many countries have several specialized or generalist e-tailers working online. For example, Amazon itself, or Zalando in the clothing sector, are called hybrid platforms because they present the opportunity to manufacturers to either sell via agency selling in the marketplace or, like a normal e-tailer, buy items from suppliers and resell them in a classic B2B2C model (Aversa et al., 2021). E-tailers, seen as foreign distributors, are also familiar with their target market and vice versa and are well recognized by customers (Sharma & Blomstermo, 2003). Therefore, we could assume that relying on indirect selling can contribute to actualizing the internationalization affordance. Thus, the following hypothesis can be formulated: H6b. : Indirect selling via third-party resellers is positively related to internationalization affordance actualization. In line with the agency selling approach and its predisposition to actualizing customer diversification affordance, we consider that indirect selling follows a comparable logic. When a manufacturer decides to engage in selling through an online channel via indirect selling, this implies that it can approach several e-tailers in the same market, who can then bring in additional sources of revenue (Abhishek et al., 2016; C. Chen et al., 2021). Although cannibalization between channels would take place, this would only favor the process of revenue diversification. Therefore, it can be envisaged that manufacturers adopting indirect selling would begin to sense the possibility of diversifying their business entries. Thus, the following hypothesis can be formulated: H6c. : Indirect selling via third-party resellers is positively related to customer diversification affordance actualization. Fig. 1 summarizes our research model. We examine this model with an explanatory mixed-method research design recently adopted by other IS and management studies (e.g., Wong et al., 2022). Our sequential design is divided into two phases: First, we use quantitative data to test the research hypotheses. Second, we use qualitative data to illustrate the quantitative findings acquired in the first phase, thus providing an in-depth understanding of the research subject. Mixed methodologies are suggested practices when the preliminary quantitative study relies on cross-sectional data (C. Maier et al., 2023). 4. Quantitative study 4.1. Methodology of the quantitative study 4.1.1. Data collection We collected data on Prolific (Bawack et al., 2023), and to ensure that the respondents qualified for our study we applied the following pre-screen filters: respondents (i) had to be classified as “having managerial experience,” (ii) leading at least two direct subordinates in (iii) a seniority level corresponding at least to middle manager, (iv) working for a SME in (v) a manufacturing industry. In addition, the respondents were screened out if they disagreed with the statement: “Our company manufactures products aimed at consumption by end consumers which, among other channels, are also marketed through the online distribution channel.” The data were collected in December 2021. After eliminating respondents based on the screening question and those with missing data (n =101), we obtained a sample of 165 valid replies (62% of all respondents). Our sample is diverse, including 64% males and 36% females, with 45% under 35 years and 55% over 35 years old, in addition to 32% originating from European Union (EU) member countries and 68% from non-EU member countries. Fig. 1. Research Model. J. Ballerini et al. International Journal of Information Management 72 (2023) 102649 7 4.1.2. Measurement To measure the newly conceived e-commerce affordances, we followed the scale development procedure widely used in research (e.g., De Luca et al., 2021; Herhausen et al., 2022). First, after exploring the existing literature, we identified four items from Thompson et al. (2019) to measure internationalization affordance, three items for consumer knowledge generation from De Luca et al. (2021) and Sutherland et al. (2004), and three items for customer diversification from Fang et al. (2011) and Styles et al. (2008). We also adapted four items from Proksch et al. (2021) and Kowtha and Choon (2001) to assess e-commerce commitment, and four items from De Luca et al. (2021) to evaluate e-commerce performance. Second, we sent the preliminary questionnaire to three highly skilled managers working for international e-commerce companies and an academic expert who was not part of the research team. Following their feedback, we rephrased some questions and added six additional items. Direct, agency, and indirect selling were measured with the degree of importance the respondents’ attributed to each online channel approach (all items of the final questionnaire are shown in Table 1). We included a number of potential control variables such as managers’ age, seniority, companies’ geographical region, and the type of industry. Age has been measured on a scale from one to five (1 <25 years, 2 =>25 <35, 3 =>35 <45, 4 =>45 <55, 5 >55 years) and seniority on a scale from one to three (1 =middle manager, 2 = senior manager, 3 =top executive). A dummy has been used for geographical region (EU vs. non-EU firms), and the different industries have been utilized as categorical variables (consumer electronics, fast-moving consumer goods, fashion, other manufacturing). 4.1.3. Exploratory and confirmatory factor analysis For the verification of the constructs, we conducted an exploratory factor analysis (EFA) to verify the latent constructs of the proposed framework. In preparation for this analysis, we first checked whether the sample of 165 respondents contained potential outliers. The Mahalanobis test identified 10 outliers that were not considered in the main analysis to avoid providing misleading conclusions. 2 The preliminary EFA led us to retain 16 items out of the initial 24. The eight items not retained generated cross-loadings that were too high in different factors. The final item setup presented commonalities above.70, and the results of a Varimax rotation showed that all the components had a minimum load on their respective factor of.65 (details in Table 1). After the EFA, we conducted a confirmatory factor analysis (CFA). Every item had a load of at least.70 on the latent variables, and convergent validity was supported by average variance extracted (AVE) values above the.50 Table 1 Measurement in the Quantitative Study. Construct Definition Derived from Items questions EFA CFA E-commerce commitment The management’s resource investments and explicit attribution of prominence communicated to employees concerning e-commerce. Kowtha and Choon (2001) Proksch et al. (2021) Our company offers trainings (courses, literature, coaching) to improve the expertise on e-commerce of our team members .813 .821 Skills related to e-commerce are an important selection criterion in recruiting new team members .783 .864 Our team members for themselves adopt all online distribution services and products we approach as a company .734 .813 Consumer knowledge generation The affordance to deeply understand firm’s consumers’ characteristics, demographics and shopping habits. De Luca et al. (2021) Sutherland et al. (2004) Investing in online channel distribution affords our company to identify patterns of final consumers behavior .736 .823 Investing in online channel distribution affords our company to identify patterns of competitive actions affecting our final consumers .742 .871 Investing in online channel distribution affords our company to increase knowledge on consumers’ demographics .795 .732 Internationalization The affordance to expand a firm’s operations in foreign markets Thompson et al. (2019) Investing in online channel distribution affords our company to increase sales into already present international markets .706 .820 Investing in online channel distribution affords our company to increase our foreign market knowledge .655 .905 Investing in online channel distribution affords our company to have more procurement inputs .688 .800 Customer diversification The affordance to diversify the sources of firms’ revenues. Fang et al. (2011) Styles et al. (2008) Investing in online channel distribution affords our company to decrease our customer concentration (B2B, not final consumers) .850 .763 Investing in online channel distribution affords our company to decrease our company dependency on major offline customers (B2B, not final consumers) .772 .762 Investing in online channel distribution affords our company to establish relationships with diverse channel members (B2B, not final consumers) .690 .721 E-commerce performance The degree of efficacy in achieving a firm’s strategic goals that managers ascribe to the e-commerce of their firm. De Luca et al. (2021) Our online channel investment is an overall success .773 .783 Our online channel success exceeds expectations .748 .737 Our online channel adds substantial value to our products and services .709 .927 Online channel was a good idea to invest in .664 .934 Direct selling The manufacturer operates its own e-commerce website selling directly to its final consumers. New item Our company strongly relies on online direct selling through digital platform enabled site Agency selling The manufacturer relies on third-party multisided platforms and sells directly to their end consumers via its account on the platforms. New item Our company strongly relies on agency selling through thirdparty digital platforms (for e.g., Amazon Marketplace, eBay, etc.) Indirect selling The manufacturer sells its products to a distributor or retailer, whether a pure player or an omnichannel player who, in turn, sells to end customers. New item Our company strongly relies on its B2B resellers for selling online to its final consumers Note: EFA =Factor loadings from exploratory factor analysis, CFA =Factor loadings from confirmatory factor analysis. 2 We replicated all the analyses with the full sample of 165 respondents. All substantive conclusions remain the same. The results are available from the first author. J. Ballerini et al. International Journal of Information Management 72 (2023) 102649 8 cutoff criterium. Discriminant validity was supported as the square root of the AVE for each construct was higher than all correlation coefficients (Table 2). The CFA showed a good fit to the data (X2/df) =1.299; RMSEA =.044; TLI =.979; CFI =.984). 4.2. Results of the quantitative study We used a structural equation model with 5000 bootstrap samples to calculate the bias-corrected confidence intervals (CIs). The structural model presents a good fit to the data (X2/df =1.335; RMSEA =.047; TLI =.950; CFI =.967). The results displayed in Table 3 suggest that ecommerce commitment is positively related to all three e-commerce affordances: consumer knowledge generation (β=.533, p <.001; supporting H1a), internationalization (β=.545, p <.001; supporting H1b), and customer diversification (β=.287, p <.05; supporting H1c). Two of the three affordances are positively related to e-commerce performance: consumer knowledge generation (β=.306; p <.001) and internationalization (β=.316; p <.01), supporting H2a and H2b. Customer diversification does not have a statistically significant relationship with e-commerce performance (β=.134; p >.10), so we have to reject H2b. We next examined the three hypothesized indirect relationships with 95% CIs. Both the e-commerce commitment → consumer knowledge generation → e-commerce performance path (β=.163; CI =.042,.437) and the e-commerce commitment → internationalization → e-commerce performance path (β=.172; CI =.020,.537) are significant, while the path e-commerce commitment → customer diversification → e-commerce performance is not significant (β=.038; CI = − .012,.151). We also find a non-significant direct relationship between e-commerce commitment and e-commerce performance. Therefore, this relationship is fully mediated by the consumer knowledge generation and internationalization affordances (but not by the customer diversification affordance), thus supporting H3a and H3b but not H3c. Direct selling is positively related to internationalization (β=.128; p <.05) and consumer knowledge generation (β=.110; p<.10), but not customer diversification (β=.050; p >.10), supporting H4a and H4b but not H4c. Agency selling is positively related to internationalization (β=.109; p <.05), consumer knowledge generation (β=.146; p <.05), and customer diversification (β=.158; p<.01), therefore supporting H5a, H5b, and H5c. Finally, indirect selling is positively related to internationalization (β=.147; p <.001) and customer diversification (β=.141; p <.05), but not consumer knowledge generation (β=.007; p >.10), thus supporting H6b and H6c but not H6a. 4.3. Discussion of the quantitative study Our quantitative results suggest that e-commerce commitment favors the actualization of all three identified affordances: consumer knowledge generation, internationalization, and customer diversification. However, only consumer knowledge generation and internationalization mediate the relationship between e-commerce commitment and ecommerce performance. Moreover, our analysis highlights that all three e-commerce approaches significantly contribute to actualizing internationalization. This means that e-commerce, regardless of the utilized approach, is a suitable practice for pursuing the internationalization of manufacturing SMEs. However, only direct selling through owned digital platforms and agency selling through third-party platforms contribute to actualizing consumer knowledge generation. Although the hypothesis of the negative relationship between indirect selling and consumer knowledge generation (H6a) is not supported, in any case we find a null and nonsignificant relationship among these two variables. Hence, only approaches involving the adoption of digital platforms can provide adequate direct data access for raising manufacturing SMEs’ knowledge of their consumers’ purchasing behavior. On the other hand, customer diversification affordance actualization is only related to indirect selling and agency selling. Despite the unsupported negative Table 2 Construct Reliability and Correlation Matrix. N. Variable name CR AVE Mean SD 1 2 3 4 5 6 7 8 9 10 11 12 13 14 1 E-commerce commitment .872 .694 4.37 1.53 .833 2 Consumer knowledge generation .851 .657 4.85 1.33 .593 .811 3 Internationalization .880 .710 4.73 1.47 .689 .657 .843 4 Customer diversification .793 .561 4.03 1.32 .491 .457 .581 .749 5 E-commerce performance .911 .722 4.91 1.39 .679 .688 .754 .551 .850 6 Direct selling 4.74 1.68 .511 .471 .553 .397 .613 7 Agency selling 3.83 1.76 .480 .468 .542 .486 .502 .354 8 Indirect selling 4.40 1.52 .496 .451 .592 .507 .485 .447 .523 9 European country .33 .47 .093 .029 .112 .142 .036 .168 .200 .168 10 Seniority 1.30 .60 -.103 .018 -.063 -.033 -.121 -.010 .024 .009 .128 11 Age 2.73 .97 -.108 -.002 -.052 .056 -.077 -.060 -.198 .056 -.102 .053 12 Consumer electronics .25 .44 .219 .027 .105 .094 .111 .118 .183 .072 .164 .029 -.161 13 FMCG .17 .38 .103 .046 .144 .078 .095 .052 .054 .069 -.032 -.120 -.153 -.266 14 Fashion .07 .26 .163 .163 .200 .101 .204 .059 .084 .076 -.033 .028 -.001 -.160 -.127 15 Other manufacturers .50 .50 -.352 -.142 -.303 -.193 -.272 -.172 -.242 -.155 -.101 .051 .256 -.584 -.462 -.278 Note: CR =composite reliability, AVE =average variance extracted. The square root of the AVE is reported on the diagonal. J. Ballerini et al. International Journal of Information Management 72 (2023) 102649 9 relationship hypothesis (H4c), direct selling again exhibits in any case a non-significant relationship supporting the inappropriateness of this approach for increasing customer diversification. We next use a qualitative study to illustrate these findings and to uncover the underlying motivations that lead to the observed relationships (C. Maier et al., 2023). 5. Qualitative study In accordance with the sequential exploratory research design, the qualitative part of the research is conducted following the quantitative element. As an initial step in the qualitative study, we opted to conduct a fsQCA analysis. This analysis has recently been used to support quantitative studies, such as SEM, to help shed light on the intricate relationships between variables (Bawack et al., 2023; Kang & Shao, 2023). Specifically, the qualitative study aims to explore the configurations of different online channel approaches and firms’ e-commerce commitment, which could lead to the actualization of e-commerce affordances. Although no predefined protocols indicate how to select respondents for qualitative interviews, research studies employing this design often select interviewees from the sample of the prior survey (Ferraris et al., 2021; Ivankova et al., 2006). Therefore, we proceeded to interview part of the surveyed population. Before that, we classified different interviewees’ configurations identified by the fsQCA, seeking to short-list at least one interviewee fitting each configuration in line with the purposeful stratified sampling criterion. This stratified sample criterion is well suited to capturing variations in the manifestation of a single phenomenon (Patton, 2014). 5.1. Method for the qualitative study 5.1.1. Selecting participants through fsQCA methodology Fuzzy sets were created using interval scale variables from fsQCA 3.0. The variables required recalibration to identify high-performing setups. Using the fsQCA program for calibration, the suggested breakpoints for full membership, non-membership, and crossover points were 0.95, 0.05, and 0.5 (Ragin, 2017). The authors then employed the fsQCA’s truth table algorithm to examine the calibrated fuzzy sets. This approach entails generating a truth table based on fuzzy data to outline configurations to be investigated and, second, identifying causal criteria and outcomes (Ott et al., 2018). A first, the investigation of the truth tables was conducted with a frequency threshold at five and with consistency set to the standard.80 threshold (Ragin, 2017). This preliminary outcome provided four equivalent configurations applicable to the actualization of all three affordances: e-commerce commitment*direct selling, e-commerce commitment*agency selling, direct Table 3 Structural Equation Model Results. Relationship β S.E. C.R. Result H1a E-commerce commitment → Consumer knowledge generation .533*** .11 5.003 Supported H1b E-commerce commitment → Internationalization .545** .10 5.528 Supported H1c E-commerce commitment → Customer diversification .287** .10 2.878 Supported H2a Consumer knowledge generation → E-commerce performance .306** .09 3.531 Supported H2b Internationalization → E-commerce performance .316** .11 2.982 Supported H2c Customer diversification → E-commerce performance .134 .09 1.575 Not supported H4a Direct selling → Consumer knowledge generation .110* .06 1.786 Supported H4b Direct selling → Internationalization .128** .05 2.387 Supported H4c Direct selling → Customer diversification .050 .06 .833 Not supported H5a Agency selling → Consumer knowledge generation .146** .06 2.427 Supported H5b Agency selling → Internationalization .109** .05 2.071 Supported H5c Agency selling → Customer diversification .158*** .06 2.657 Supported H6a Indirect selling → Consumer knowledge generation .007 .07 .097 Not supported H6b Indirect selling → Internationalization .147** .06 2.301 Supported H6c Indirect selling → Customer diversification .141** .07 2.041 Supported E-commerce commitment → E-commerce performance .029 .10 .290 Indirect selling → E-commerce performance -.035 .05 -.741 Direct selling → E-commerce performance .159** .04 3.885 Agency selling → E-commerce performance -.004 .04 -.098 Consumer electronics → Consumer knowledge generation -.180 .19 -.942 Consumer electronics → Internationalization -.055 .21 -.259 Consumer electronics → Customer diversification -.461** .22 -2.147 FMCG → Consumer knowledge generation -.183 .23 -.788 FMCG → Internationalization .225 .21 1.088 FMCG → Customer diversification .113 .23 .491 Fashion → Consumer knowledge generation .033 .33 .098 Fashion → Internationalization .434 .30 1.465 Fashion → Customer diversification .08 .33 .244 European country → Consumer knowledge generation -.164 .18 -.928 European country → Internationalization -.013 .16 -.086 European country → Customer diversification .112 .18 .637 Seniority → Consumer knowledge generation .191 .14 1.389 Seniority → Internationalization -.010 .12 -.081 Seniority → Customer diversification -.026 .14 -.192 Age → Consumer knowledge generation .092 .09 1.047 Age → Internationalization .027 .08 .342 Age → Customer diversification .181** .09 2.072 FMCG → E-commerce performance .035 .15 .230 Fashion → E-commerce performance .154 .22 .713 Consumer electronics → E-commerce performance .034 .15 .233 European country → E-commerce performance -.131 .12 -1.142 Seniority → E-commerce performance -.147 .09 -1.627 Age → E-commerce performance -.046 .06 -.773 Note: * ** =p<.01; * * =p<.05; * =p<.10. 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