HPI631 6 Assignment
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Making Business-to-Business International Internet Marketing Effective: A Study of Critical Factors Using a Case-Study Approach
ABSTRACT
Riyad Eid, Ibrahim Elbeltagi, and Mohamed Zairi
Submitted November 2005 Accepted July 2006
Journal of International Marketing © 2006, American Marketing Association Vol. 14, No. 4, 2006, pp. 87–109 ISSN 1069-031X (print)
1547-7215 (electronic)
The recent phenomenal growth in business activities depend- ent on the Internet has demonstrated that various potential advantages could be derived from using information and com- munication technology platforms. The Internet has enabled firms to reach out to global markets and has provided them with the opportunity to customize their strategies and offerings in an unprecedented way. These recent developments provide an exciting opportunity for research to study the dynamics involved in international Internet marketing (IIM) and, in par- ticular, to examine closely the factors that could influence suc- cess in using this new technology for IIM activities. Using a business-to-business context and a multiple-case-study approach, this article focuses on two main areas of study: (1) the critical examination of the literature and identification of the most important factors that have a significant influence on business-to-business IIM and (2) the first-hand verification of how the identified factors are implemented in various organiza- tional contexts.
Internet marketing is heralded by some as the new paradigm of marketing (see, e.g., Eid and Trueman 2002, 2004; Hoff- man, Novak, and Peralta 1999). Eid and Trueman (2002) indi- cate that much of the current literature considers Internet marketing a completely new phenomenon. Thus, there has been little attempt to integrate the study of its impacts into existing knowledge, and calls for more research into interna- tional Internet marketing (IIM) remain unheeded. There are a small number of studies related to IIM, but the dominant focus of these studies is on the way the Internet is used, driv- ers and barriers to its use, and how these might be overcome (Eid and Elbeltagi 2005; Hamill and Gregory 1997; Morgan- Thomas and Bridgewater 2004).
Avlonitis and Karayanni (2000), Eid and Trueman (2004), Hamill and Gregory (1997), Hoffman, Novak, and Peralta (1999), Mattila, Karjalouto, and Pento (2003), Porter (2001), and Quelch and Klien (1996) have all conducted in-depth studies to gain an understanding of the factors that enhance business-to-business (B2B) IIM implementation. They con- clude that organizations need to understand how to identify the critical factors that affect the implementation process
88 Riyad Eid, Ibrahim Elbeltagi, and Mohamed Zairi
and address them effectively to reduce risk and realize the potential of Internet marketing.
However, although most transactions that occur on the Inter- net are in the B2B domain (Eid and Elbeltagi 2005), research into B2B Internet marketing is still in its infancy. Most research on Internet marketing has been descriptive, theo- retical, or speculative. There are few solid models to guide research or application in this area. There have been several attempts to identify the full range of critical success factors for B2B IIM (Avlonitis and Karayanni 2000; Chan and Swat- man 2000; Furnell and Karweni 1999; Honeycutt, Flaherty, and Benassi 1998; Lynn et al. 2002), but few of these studies can provide strong theoretical evidence for the existence of these factors. Some authors and practitioners present a plethora of critical factors based on individual experiences (e.g., Avlonitis and Karayanni 2000; Chan and Swatman 2000; Cronin 1996a, b; Damanpour 2001; Duggan and Deveney 2000), and others have addressed only one main aspect of B2B IIM. For example, Porter (2001) examines mar- keting strategy and makes a new combination of virtual and physical activities; Furnell and Karweni (1999) and Scullin, Fjermestad, and Romano (2004) address security and suc- cessful relationship; and Gogan (1997) focuses only on the culture and the technological infrastructure of B2B IIM. Thus, a practical, full-scale, scientific study is required to understand and identify the full range of critical success fac- tors for B2B IIM.
The main objectives of this article are twofold: (1) to identify critical success factors for B2B IIM implementation and (2) to examine how these factors have been operationalized in real organizational settings. To this end, we studied various arti- cles, empirical research, and secondary case studies on B2B issues, the Internet, international marketing, e-commerce, and information technology. The findings of these studies identified various factors that have a direct impact on the successful implementation of B2B IIM.
Critical success factors can be defined as areas in which things must go right for the business to flourish. Oakland (1995) views these factors as the critical areas that the organ- ization must examine, categorize, and succeed in to achieve the organization’s mission. In terms of IIM, critical success factors can be viewed as the activities and practices that must be addressed to ensure successful implementation. These practices would need to be either nurtured if they already exist or developed if they are not yet in place.
Several studies have been carried out to identify the factors most critical to B2B IIM success. For example, Avlonitis and
THEORY DEVELOPMENT AND FRAMEWORK DESCRIPTION
89Making B2B International Internet Marketing Effective
Karayanni (2000) and McCole (2004) note that if appropriate training is provided, the sales force can play a central role in the implementation of Internet marketing strategies. How- ever, top management support is key for the effective integra- tion of the Internet with the strategic marketing plan. Chan and Swatman (2000) point out other factors, such as supplier and customer involvement, culture, and the use of both tra- ditional and online marketing. Cronin (1996a) adds the secu- rity factor to the marketing strategy and culture, and Daman- pour (2001) shows that meeting client demand is important in fulfilling the obligations of Internet-based marketing. Being flexible when collaborating with the trading commu- nity, identifying potential valuable partners, thinking glob- ally, and conducting business in Internet time (speed) are all critical success factors for the implementation of B2B IIM. Duggan and Deveney (2000) indicate that the integration between offline and online marketing efforts, customer acceptance, and the language used are also critical success factors. Furnell and Karweni (1999) agree that the develop- ment of successful interorganizational relationships is another critical factor, which is based primarily on the qual- ity and quantity of information exchanged over the Internet. McCole (2004), Poon and Jevons (1997), and Hoffman, Novak, and Peralta (1999) all agree that trust between a ven- dor and a potential customer is another critical factor. E- commerce is not a technology competition. Rather, it is the combination of relationships, partnerships, organizations, and communications made possible by new technology.
The different critical success factors for the implementation of B2B IIM have been grouped into four categories: marketing strategy factors, internal factors, market factors, and Web site factors. We discuss each category in more detail in the fol- lowing subsections.
Although it has been argued that the Internet should be con- sidered a separate plan, it should be remembered that Inter- net marketing strategy is an integral part of the overall mar- keting strategy insofar as it supports the main thrusts of the marketing and business strategy (Chaffey et al. 2000). Con- versely, many researchers and practitioners have increas- ingly viewed factors related to marketing strategy as a vital component of successful B2B IIM (Chan and Swatman 2000; Cronin 1996b; Duggan and Deveney 2000; Furnell and Kar- weni 1999; Gurau, Ranchhod, and Hackney 2001; Hofacker 2001; Lynn et al. 2002; McCole 2004; Porter 2001; Quelch and Klein 1996). Having top management support, setting strategic goals, integrating Internet marketing and marketing strategy, collaborating with strategic partners, and deciding on the potential audience are the most important marketing strategy factors for the successful implementation of B2B IIM.
Marketing Strategy Factors
90 Riyad Eid, Ibrahim Elbeltagi, and Mohamed Zairi
The internal company infrastructure must be set up with col- laboration in mind. Many researchers and practitioners have increasingly viewed factors related to the internal environ- ment as a critical component of successful B2B IIM efforts (Avlonitis and Karayanni 2000; Chan and Swatman 2000; Duggan and Deveney 2000; Gogan 1997; Krishnamurthy and Singh 2005; Quelch and Klein 1996; Samiee 1998). In today’s business world, B2B IIM has entered a new era in which the barriers of language, culture, and national borders are fading. Although many authors have considered the importance of the global dimension a vital component of successful B2B IIM efforts, there are still many pitfalls associated with developing a global presence (Chaffey et al. 2000; Chan and Swatman 2000; Gogan 1997; Hamill and Gregory 1997; Her- big and Hale 1997; Hofacker 2001; Kotab and Helsen 2000). In our view, the launching platform for global success in B2B IIM is a strong internal environment. The opportunities pos- sible with B2B IIM are contingent on many internal factors. Therefore, it is important to consider a well-balanced blend of technological infrastructure, appropriate internal culture, in-depth understanding of the foreign marketing environ- ment, the resources required to work globally, qualified salespeople, efficient relationships between the marketing department and the information systems/management infor- mation systems (IS/MIS) department, and a well-trained sales force.
Many researchers and practitioners consider market factors another key component of successful IIM implementation (Chan and Swatman 2000; Duggan and Deveney 2000; Fur- nell and Karweni 1999; McCole 2004; Poon and Jevons 1997; Quelch and Klein 1996; Urban, Sultan, and Qualls 2000; Wil- son and Abel 2002). In dealing with either external or inter- nal customers, firms must realize that factors such as trust, security and privacy, successful relationships, easy and affordable access to the Internet, resources required for work- ing globally, and customer acceptance all influence the per- ceived image of the Web site and, in turn, the successful practice of B2B IIM.
Companies use the Web to convey promotional messages or interesting and informative material to consumers. The Web site can also be used to sell products directly to the cus- tomers and to provide them with various computing and communication services (Hamill and Gregory 1997, p. 25). However, the corporate Web site is the company’s marketing showpiece, and many researchers consider it a crucial com- ponent in any B2B IIM effort (Hamill and Gregory 1997; Hofacker 2001; Kotab and Helsen 2000; Lynn et al. 2002; Quelch and Klein 1996; Samiee 1998). A well-designed Web site, the effective marketing of the Web site, multilingual capabilities, and culture consideration are the most impor-
Internal Factors
Market Factors
Web Site Factors
91Making B2B International Internet Marketing Effective
tant Web site factors that contribute to the success of B2B IIM (for a visual representation of our framework for the effective implementation of B2B IIM, see Figure 1).
The purpose of this research is not to identify conceptually the linkages among the different dimensions of the critical success factors or to examine how these factors affect the success of B2B IIM. Instead, this section discusses some potential linkages between the constructs that might be used as a base for further research.
The research framework (see Figure 1) reflects two ways of how critical success factors could affect B2B IIM success. The first way focuses on the direct linkages among the differ- ent components of the proposed framework. On the basis of these types of relationships, we could suggest that marketing strategy factors and internal factors influence Web site fac- tors. Prior research supports this view. For example, Prasad, Ramamurthy, and Naidu (2001) and Sheth and Sharma (2005) find that e-marketing strategy affects and will con- tinue to change IIM practice. For example, culture, an ele- ment of the internal factors, has been shown to have a sig- nificant impact on how Internet users browse and shop and even to influence their expectations from a particular Web site (Krishnamurthy and Singh 2005). Extensive empirical investigation is needed to understand how the critical suc- cess factors could affect one another and, in turn, the success of B2B IIM.
Combining information integration with active marketing on the Web is especially important for B2B IIM. According to the proposed research framework, Web site factors affect the success of B2B IIM. Previous research has shown that culturally adapted Web content leads to better usability, more favorable attitude toward the site, and higher purchase intentions (Singh, Furrer, and Ostinelli 2004). According to Herbig and Hale (1997), if a Web site is the first critical step in forging a personal international business rela- tionship, the ability to “connect” will not be established unless the Web site ensures that the first connection is sensi- tive to the cross-cultural aspects of interface design, navi- gation currency, time and state conventions, localization, and internationalization.
The second type of relationship identifies factors that moder- ate the success of B2B IIM. In our study, market factors may moderate the impact of Web site factors on B2B IIM success. Therefore, if both a positive market environment in terms of security and trust and a positive, encouraging culture facili- tate the use of the Internet as a medium for buying and sell- ing, we expect successful B2B IIM, and vice versa. Having a Web site is not enough to generate international sales, even
Proposed Research Framework
92 Riyad Eid, Ibrahim Elbeltagi, and Mohamed Zairi
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93Making B2B International Internet Marketing Effective
though the Internet makes it technologically feasible for global customers to access a company’s site. Therefore, com- panies should consider the market factors and adopt e- marketing strategies to the desires and needs of international customers. A holistic, quantitative analysis is needed to investigate the direct and indirect effects of the critical suc- cess factors on B2B IIM success.
This article describes qualitative research into companies’ B2B IIM efforts through a series of in-depth interviews. The evidence from multiple cases is compelling, and therefore the overall study is more robust. Multiple case designs fol- low a “replication” logic (as opposed to a “sampling” logic). Therefore, contrary to a common misconception that case studies provide little basis for scientific generalization, multiple case studies are generalizable (though not necessar- ily to multiple populations or contexts). Our goal was to expand and generalize theories (analytic generalization), not to enumerate frequencies (statistical generalization). Given our objectives, a case study with a multiple case design was the appropriate methodology. Having multiple sources of evidence also helps overcome the commonly cited limita- tions of interviews (i.e., bias, poor recall, and poor or inaccu- rate articulation). In addition, we used paraphrasing and summarizing intermittently during each interview to ensure that the interviewees’ answers were interpreted accurately.
The criteria for selecting the organizations to participate were as follows: First, a marketing manager/sales manager (or the person who was in charge of IIM activities) needed to be available to participate in the interview. Second, compa- nies needed to have already used or to be in the process of using the Internet for B2B IIM. Finally, companies should come from different sectors. Several organizations were con- tacted, and three prominent ones expressed interest and met the criteria. We decided to use all three. We have given each company a false name to preserve anonymity. At the time of the study, two of these companies, Petrolco and Electricco, had completed a B2B IIM project and were in the realization stage. The third company, Textileco, was midway through the implementation stage.
We conducted three interviews with the Internet manager, the e-business strategy manager, and the e-business manager at Petrolco; we conducted only one interview with the e- commerce marketing manager responsible for the Internet marketing project at Electricco; and we conducted only one interview with the managing director responsible for the Internet marketing project at Textileco. The number of inter- views that could be conducted was limited because of the lack of time and resources. However, follow-up telephone
METHODOLOGY
Participants in the Case Study
94 Riyad Eid, Ibrahim Elbeltagi, and Mohamed Zairi
calls were made to cover some aspects that were not fully covered in the interviews.
The technique we chose for data collection was face-to-face interviews. We deemed this to be the most suitable approach mainly because of the “exploratory” nature of the study, which meant that a comprehensive discussion was required regarding several issues (i.e., marketing strategy, internal fac- tors, market factors, and Web site factors). This would pro- vide the opportunity for interaction rather than answering specific questions.
To give structure to the interview, we prepared and docu- mented some guidelines. These were based on the study out- comes and were aimed at achieving the study objective. Interviewees were encouraged to talk about any issues that they believed were important to ensure that the various ele- ments of B2B IIM were addressed. All critical factors were covered with all interviewees, and there was flexibility to rephrase or reframe questions according to the context of a particular interview.
We recorded the interviews using a tape recorder and subse- quently transcribed them. We computerized these transcripts into a database. We then consolidated all data taken from interviews, observations, and documents and linked them together to create a full picture of each company’s entire process of implementation. The diversity of issues repre- sented in all three case studies has the advantage of enrich- ing the data collected. This richness of data facilitates com- parative analysis among the cases and therefore leads to theory improvement.
In this section, we focus on the description and analysis of the qualitative data. We consider each critical factor and examine the broader picture of similarities and differences among the experiences of Internet use in each of the three companies.
First, Petrolco is one of the largest industrial companies in the world. The head office of this company is in the United Kingdom and is a base for global Petrolco firms, such as Oil Products, Chemicals, Renewables, Gas and Power, Aviation, Marine Products, and Petrolco Services International (all pseudonyms for Petrolco’s subsidiary companies). The com- pany provides a wide range of services from management consultancy to information systems support. The trading and shipping arm of the Oil Products company, Petrolco Interna- tional Trading and Shipping Company, is based in London. It trades approximately four million barrels of crude oil a day. We conducted interviews with the Internet manager, the e- business strategy manager, and the marketing manager, all of
Data Collection Process
OVERVIEW OF THE CASE STUDIES
95Making B2B International Internet Marketing Effective
whom have been involved in the B2B IIM implementation and all of whom are located in the headquarters in London.
The second case study is Electricco. Founded in 1939, Elec- tricco is one of the world’s leading distributors of electronic, electrical, and industrial products with cutting-edge e-procurement capabilities. Employing more than 1000 people in 20 countries around the world, Electricco offers more than 100,000 leading-brand products to design, mainte- nance, production, and purchasing professionals in organi- zations of all sizes and within myriad industries. Products are available ex-stock, 24 hours a day, 365 days of the year. We conducted an interview with the marketing manager responsible for the Internet marketing project.
The third case study is Textileco, which is the only U.K.- based manufacturer of specialty polyester fibers. Textileco has more than 35 years’ experience producing polymer fiber and meeting the requirements of the fiber users. More than 60% of Textileco production of polyester fiber is exported worldwide. Many internationally based companies now depend on Textileco for the supply of specialized or colored fiber for smaller batch quantities or for emergency supplies with extremely short lead times. We interviewed the manag- ing director responsible for the Internet marketing project.
The remainder of this article presents the details of the case- study findings and reports on critical success factors from the perspective of each company. The different critical fac- tors for the successful implementation of B2B IIM are grouped according to each of the following categories: (1) marketing strategy factors, (2) internal factors, (3) market fac- tors, and (4) Web site factors.
Our finding that top management commitment and support has a critical role in B2B IIM success is reinforced in the work of Avlonitis and Karayanni (2000), Chaffey and col- leagues (2000), Chan and Swatman (2000), McCole (2004), and Scullin, Fjermestad, and Romano (2004). Top manage- ment’s support has been characterized as an important factor for the successful implementation of any business innova- tion (e.g., the use of the Internet for B2B IIM). Indeed, all three companies considered top management commitment and support the most important factors that positively influ- enced B2B IIM implementation. The managers provide resources and support the acceptance of using the Internet for international marketing purposes. The executive board of Petrolco and the Chemicals executive committee all bought into the idea of the Internet at an early stage and have pro- vided sufficient support and resources that would help implement this strategy. In the case of Electricco, top man- agement gave the B2B IIM project a high priority and drove
CASE-STUDY ANALYSIS
Marketing Strategy Factors
96 Riyad Eid, Ibrahim Elbeltagi, and Mohamed Zairi
the initiative forward by providing everyday encouragement and the necessary financial support. Similarly, the managing director led the project in Textileco. Top managers played a key role in Internet implementation. However, the ways to get top management involved and the nature of the participa- tion varied from company to company (see Table 1).
Our findings support previous research that shows that using the Internet in marketing should be based on clearly defined, strategic goals (Chaffey et al. 2000; Honeycutt, Flaherty, and Benassi 1998; Javalgi, Martin, and Todd 2004; Mattila, Kar- jalouto, and Pento 2003; Naude and Holland 1996). However, although all three companies agreed with this, their strategic goals of Internet usage for marketing purposes varied, depending on the size and position of the company. Whereas Petrolco’s goals were to design and deploy the Internet to strengthen its current business and to improve services offered to its customers, Electricco’s goal was to grow Inter- net sales to 10% of its overall sales, and Textileco’s goal was to find customers who use its specialty products. The man- aging director at Textileco noted,
We know the people who use 500 tons a week. They’re no problem. It’s finding the small ones that … will pay a better price, because they buy less, so we make a better margin.
Similarly, the findings of this study reinforce the increas- ingly accepted view that companies’ Internet-enabled capa- bilities should be employed in ways that complement and support their traditional channels (Avlonitis and Karayanni 2000; Chan and Swatman 2000; Cronin 1996a, b; Duggan and Deveney 2000; Gurau, Ranchhod, and Hackney 2001; Honey- cutt, Flaherty, and Benassi 1998; Lynn et al. 2002; Porter 2001; Quelch and Klien 1996). All the three cases illustrate different interpretations of this factor. Using the same mar- keting agency to create the handbook, the physical brochure,
Table 1. Reasons and Nature of Top
Management Support of B2B IIM
Company Reasons That Led Top
Management to Support B2B IIM Nature of
Participation
Petrolco •Business case
•Clear vision
•Industry requirements
•Regular meetings
•Reporting
Electricco •Clear vision
•Business future needs
•Integration
•Monthly meetings
•Reporting
•Monitoring and reviewing
Textileco •Clear vision
•Speed
•Business future needs
•Regular meetings
•Monitoring and reviewing
97Making B2B International Internet Marketing Effective
and the Web site and offering customers many ways to place orders, track invoices, and pay (e.g., online, mail, telephone, personal contacts) were methods that Petrolco used to inte- grate its Internet marketing with its marketing strategy. Con- versely, Electricco used the Internet as part of its total offer- ing for customers to achieve that integration.
Although our findings support those of Chan and Swatman (2000), Damanpour (2001), Duggan and Deveney (2000), Phan and Strata (2002), Poon and Jevons (1997) and Scullin, Fjermestad, and Romano (2004) that trading partner relation- ships are crucial issues that companies face in achieving their objective of getting closer to their customers, our find- ings also show that these relationships have a second-degree importance. For B2B IIM to succeed, large networked com- munities that comprise business partners, suppliers, internal personnel, and customers should be established. However, whereas Electricco, for example, considered collaboration with suppliers and distributors a crucial factor for B2B IIM success, Petrolco paid less attention to this collaboration. This might be due to the position of each company in its value chain.
Studies by Herbig and Hale (1997), Hofacker (2001), and White (1997) confirm our finding that defining the audience or customer is a primary task because it determines how and when internal and external actors should be involved. The target-customer type determines many aspects of the Internet marketing initiative, from site design to online marketing techniques. The more specific the target audience, the more companies will be able to provide the appropriate informa- tion on their Web sites. This result has been supported by the qualitative approach. All three companies agreed that the potential audience helps them customize their Web sites. Consequently, delivering personalized information online enables these companies to support multiple levels of cus- tomers in a way that best meets their individual needs. To this end, Petrolco does a lot of work and analysis to under- stand potential customers.
Technological infrastructure, internal culture, relationships between the marketing and the IS/MIS departments, the role of the sales force, in-depth understanding of foreign market- ing environment, access to resources, and training programs are all important internal tools for companies that want to establish an effective B2B IIM practice. Technological infra- structure includes computer literacy, Internet-related soft- ware, and availability and standardization of equipment (for access and services) that are required to reach the stage of information integration. Internal culture plays a major role in enabling or disabling implementation efforts. The relation- ship between the marketing and the IS/MIS departments
Internal Factors
98 Riyad Eid, Ibrahim Elbeltagi, and Mohamed Zairi
helps the implementation of the Web-based system. The sales force should be highly qualified and trained to be able to take advantage of the Internet capabilities. Finally, train- ing programs affect the understanding of the system and the technologies, which in turn leads to greater acceptance of B2B IIM implementation. However, internal factors are of a second or third level of importance. This may be because companies that use the Internet for their marketing purposes are supposed to be prepared internally before using it.
Similar findings can be drawn from several studies (see, e.g., Eid and Trueman 2004; Naude and Holland 1996; Phan and Strata 2002; Samiee 1998) that view technological infrastruc- ture as a critical factor contributing to the success of B2B IIM efforts. Our three case studies demonstrate the importance placed on this factor. Electricco and Petrolco agreed that technological infrastructure is a crucial element for B2B IIM. However, whereas Petrolco has built the infrastructure of Internet marketing on existing information technology, Tex- tileco outsourced the entire Internet infrastructure.
Organizational culture influences the organization’s ability to adapt to the change required for the effective use of the Internet, whereas the existing culture might contain beliefs and values that are often no longer appropriate or useful in this new business environment. Therefore, companies must understand and confirm new values and communication styles that the Internet makes possible (Chan and Swatman 2000; Duggan and Deveney 2000; Krishnamurthy and Singh 2005; White 1997). All three cases agreed that having a sup- portive internal culture is a crucial element in Internet mar- keting implementation. For example, by developing a team- work culture and the participative style of management, Electricco has created a level of environmental stability that is solid enough to support the Internet use for marketing activities.
Similarly, the relationships between the marketing and the IS/MIS departments cannot be overemphasized. Technologi- cal change due to the Web is forcing a paradigm shift within the IS/MIS department because the Internet has opened up a new stage of cooperation between the marketing and the IS/ MIS departments (Lynn et al. 2002). The externalization wrought by Internet computing has driven information tech- nology and marketing together. Furthermore, the marketing department must build strong relationships with the com- pany’s main line of business and the IS/MIS department (Lynn et al. 2002). This finding is also supported by our interviews. Petrolco and Electricco agreed that B2B IIM could not succeed without good cooperation between the marketing and the IS/MIS departments. For example, the e-
99Making B2B International Internet Marketing Effective
commerce marketing manager at Electricco noted the following:
[T]echnical people have realized that they need market- ing people to be able to make a success of the Web site, and marketing people have realized that they can’t make it all-singing; they have to look at technical requisites.
However, there are two points of view with regard to the role of the sales force. To many sales professionals, Internet tech- nology facilitates the communication between the sales force and the customer and provides much greater and easier access to information that can add significant value to the relationship. Conversely, many sales professionals believe that Internet technology can maintain the current level of sales and increase profits by eliminating a portion of the sales force. However, in line with findings of Avlonitis and Karayanni (2000) and Kotab and Helsen (2000), our study supports the former point of view because we found that the sales department and the sales force play a central role in the successful implementation of the Internet marketing strate- gies for industrial organizations. Most respondents indicated that salespeople would never be eliminated. The managing director at Textileco stated that “good sales people obviously are extremely important people in the Internet business.”
Similarly, our findings support those of Eid and Trueman (2004), Hofacker (2001), Quelch and Klien (1996), Samiee (1998), and Wood and Robertson (2000), who note that an in- depth understanding of the foreign marketing environment has been found to play a critical role in B2B IIM success. All the three companies we studied agreed that it is important to understand the foreign market’s environment to achieve bet- ter results for B2B IIM efforts, but they all used different tools to obtain the required information. Petrolco used its local operating units, Electricco used its foreign offices, and Tex- tileco used its sales people to obtain the desired understand- ing of the foreign markets.
It is clear that access to resources plays an important role in determining the sophistication of Internet usage. However, whereas Mehta, Grewal, and Sivadas (1996) observe that the Internet provides a level playing field for a small company in relation to a large company in international market, Arnott and Bridgewater (2002), Kotab and Helsen (2000), Quelch and Klein (1996), and Samiee (1998) all agree that large firms still enjoy a substantial competitive advantage because they have greater resources and more visibility among prospective customers worldwide. This finding is also supported by our interviews because all companies agreed that resources required for working globally play a crucial role in facilitat-
100 Riyad Eid, Ibrahim Elbeltagi, and Mohamed Zairi
ing B2B IIM efforts. As the e-commerce marketing manager at Electricco noted,
[Y]ou need to have locally a dedicated resource for Internet marketing or at least, if it cannot be 100% on Internet marketing, somebody who is responsible for it who can quickly respond to customers, and the best way to do that is through a local resource.
Finally, the choice of compatible technology that is capable of delivering appropriate information at the right time is important, but the system will work only if all personnel are adequately trained and motivated. Companies must ensure that all their employees understand the corporate Web strat- egy and must be aware of the Web site’s content. This is illus- trated by Chan and Swatman (2000), Duggan and Deveney (2000), Lynn and colleagues (2002), Samiee (1998), and White (1997), who all find that employee training programs that align with the Internet strategy are important for suc- cessful B2B IIM. Indeed, the current research also finds that training marketing people is a key factor. However, although there was a high level of agreement about the importance of training programs among the three companies, the way those training programs have been developed, the people that are involved, and the time base all varied. Petrolco trained its marketing people and customer service center internally every new launch. Electricco continuously trained its mar- keting people externally. Finally, Textileco occasionally trained all employees internally and externally (see Table 2).
This study identified several external success factors for Internet customers, including trust, security, successful rela- tionships, easy and affordable access to the Internet, delivery channel, and customer acceptance. The trust factor is consis- tent with the work of Hoffman, Novak, and Peralta (1999), Ratnasingham (1998), McCole (2004), and Urban, Sultan, and Qualls (2000), who observe that an environment of trust must be present in Internet marketing. However, this is not necessarily because of a lack of confidence in the security technologies themselves but rather because in many cases, people are not sufficiently aware of the possible protection
Table 2. Training Programs in
Participating Companies
Company Time Base Involved Users Developed
Petrolco Every new launch Marketing people Internally
Customer service center
Electricco Continuously Marketing people Externally
Textileco Occasionally All employees Internally and externally
Market Factors
101Making B2B International Internet Marketing Effective
that exists (Furnell and Karweni 1999). Urban, Sultan, and Qualls (2000) discuss this point in more detail and find that Internet trust could be divided into three stages: trust in the Internet and the specific Web site, trust in the information displayed, and trust in delivery fulfillment and service. However, although our interviewees agreed that trust is important in the virtual world, means of building Web site trust varied from one company to another. To build Web site trust, Petrolco relied on two tools: (1) virtual advisor tech- nology to gain customer confidence and belief and (2) the offering of competitive products that support its brand name. Electricco used unbiased information and delivery fulfill- ment as a key to build Web site trust, whereas Textileco relied on trust built offline and depended on the company’s history.
As the findings of Evans and King (1999), Furnell and Kar- weni (1999), Honeycutt, Flaherty, and Benassi (1998), Rat- nasingham (1998), and Samiee (1998) support, security in placing orders and in providing confidential data is essential for successful efforts of B2B IIM. Ratnasingham further divides Internet security into two significant areas: Internet security and transaction security. The former addresses the network, system, and applications components of the elec- tronic commerce solution, and the latter addresses the requirements for secure electronic commerce transactions. However, the security requirements have already been recog- nized in the Internet/e-commerce community, and several technologies exist that may be used to satisfy different ele- ments. Our interviews support this finding. For example, the Petrolco sites enable customers to place and track orders using standard Web browsers with Secure Socket Layer encryption. Petrolco invested a lot of money in technology, such as single sign-on technology, and placed a great impor- tance on this issue. Similarly, Electricco used Secure Socket Layer to make Web communications more secure.
The findings of this study seem to reinforce the increasingly accepted view that Internet companies are required to develop more responsive, deeper, and broader relationships with customers, suppliers, and distributors to increase the success level of their Internet marketing efforts (Furnell and Karweni 1999; Naude and Holland 1996). The strategic implementation of the Internet depends on effective online and offline relationships with customers, suppliers, and dis- tributors. Our three cases agreed that companies must use databases to acquire an understanding of the individual cus- tomer’s needs and develop strong customer relationships. The e-commerce strategy manager at Petrolco noted, “With good communication and establishment of strong relation- ship, the customers will be unlikely to leave if their needs are met.”
102 Riyad Eid, Ibrahim Elbeltagi, and Mohamed Zairi
Easy and affordable access to the Internet (connectivity) is another factor that has been found to affect the success of B2B IIM. This finding supports the previous studies of Palumbo and Herbig (1998), Phan and Strata (2002), and Samiee (1998). Companies should not expect to find the same easy electronic access that exists in the United States in all countries. To this end, companies have two options: to adopt a proactive or a reactive solution. The proactive approach means that companies should use their own resources to solve the connectivity problem. For example, Intel tested its connectivity with customers in a production environment. Because performance can vary significantly in different countries, Intel went the extra mile to bring cus- tomers’ connection up to the global standard (Phan and Strata 2002). Conversely, the reactive approach suggests that companies should wait until these countries invest in better telecommunication infrastructures before they can take full advantage of the opportunities the Internet offers for global commerce (Palumbo and Herbig 1998). Petrolco followed the latter approach, as cited by its e-commerce strategy manager: “Your B2C [business-to-consumer] is ultimately your B2B customer, and if there is a high adoption rate in Internet use in particular countries, then we invest in [those] countries.” However, the cost of connection has not been cited as impor- tant for the success of B2B IIM. Resources that are available for B2B companies may explain this result. In other words, if the connection costs play a critical role in the case of B2C, they cannot play the same role in the case of B2B because of the resources that are available for B2B companies. Our interviews support this view. The respondents at Electricco and Petrolco agreed that access cost is not important for B2B IIM. The e-commerce marketing manager at Electricco said, “[W]e’re talking about [B2B] marketing; for the majority of people, cost is no issue.”
In line with the findings of Palumbo and Herbig (1998), Poon and Swatman (1998), and White (1997), we identify delivery channel in this study as a critical factor that contributes to the success of B2B IIM efforts. Thus, the Web page that pro- motes the company’s products should also show where they can be acquired. However, the delivery channels in partici- pating companies varied, depending on the size and position of the company. Electricco depended on distributors to deliver their products to each country, Petrolco used the local level (branches) to deliver its products, and Textileco used its own trucks to deliver its products.
The final market factor is customer acceptance (Chaffey et al. 2003; Chan and Swatman 2000; Cronin 1996b; Phan and Strata 2002). We found this to be the most important external factor. Customers visiting the Petrolco Web site will find applications available to them based on their own user name
103Making B2B International Internet Marketing Effective
and password, Electricco asks its customers to reorder auto- matically and increases the level of customer service to obtain customers’ acceptance of online marketing, and Textileco depends on the nature of its product for customer acceptance.
Design, marketing, language, and cultural considerations are important tools for companies that want to use the Internet for their marketing activities. In line with the findings of Clarke and Flaherty (2003), Hamill and Gregory (1997), Her- big and Hale (1997), Hofacker (2001), Karayanni and Baltas (2003), Kotab and Helsen (2000), Poon and Swatman (1997), Quelch and Klien (1996), and Samiee (1998), we identified several design characteristics in this study as critical factors that contribute to the success of B2B IIM efforts. The respon- dents in this research believed that Web site factors were cru- cial in their strategies to develop their B2B IIM activities.
In accordance with the arguments of Clarke and Flaherty (2003), Hamill and Gregory (1997), Herbig and Hale (1997), Chaffey and colleagues (2000), and Haig (2001), a well- designed site has been found to play a critical role in the suc- cess of B2B IIM. As Haig notes, the most important design principle is to “keep it simple.” Because, in general, business decision makers want to absorb information on a Web page in as short a time as possible, text and images should be used with strict restraint throughout a Web site. Similarly, ease of use (usability) is another design criterion that has been found to affect B2B IIM success. Without adhering to the principles of usability, it will be more difficult for B2B sites to achieve their objectives. Our research also confirms the findings of Evans and King (1999) and the argument of Herbig and Hale, who address the need for clear, organized Web sites and easy-to-navigate pages that enable smooth movement around the site. Accurate information is another criterion that has been found to have a critical effect on the quality of the Web site. This supports the work of Hamill and Gregory, who argue that information that is viewed as biased will not be taken seriously and will have a negative effect on the com- pany’s image. Furthermore, companies should provide infor- mation that meets different needs to encourage a mix of nationalities and cultures. They should take advantage of the highly interactive nature of Web sites by recognizing that users are active acquirers of information. Thus, as Chaffey and colleagues, Evans and King, and Hamill and Gregory note, the speed (i.e., of downloads) of the site has been found to have a critical effect on the quality of the Web site.
Our in-depth interviews endorsed this finding. However, each company identified several design characteristics as critical and used a different approach to design. For exam- ple, at Petrolco, good design, up to date, information, and ease of use were cited as the most important characteristics.
Web Site Factors
104 Riyad Eid, Ibrahim Elbeltagi, and Mohamed Zairi
At Electricco, the e-commerce marketing manager defined quality, information, ease of use, and simplicity as the most important factors for Web site design. The managing director at Textileco cited only ease of use, speed of use, and informa- tion as the characteristics that affect the design of the Web site. Thus, although the interviewees agreed about some characteristics (i.e., information and ease of use), the criteria of a well-designed site varied from one company to another. However, this is related to the type of industry and the nature of the product. For example, the e-commerce marketing manager at Electricco noted,
[E]ase of use is more important than the design because a lot of our customers are design engineers, and they much rather would have a text on the page that gives them all the information they want rather than a nice- looking HTML page.
However, to confirm these observations, more research is needed in each industry to ascertain the real effect of indi- vidual product and industry requirements related to Web design criteria.
Petrolco hired an external company to develop its Web site, and Textileco used its own in-house resources to build its Web site. This supports Haig’s (2001) argument that it is appropriate for small companies to develop a Web site using a specific Web design software, such as WYSIWYG (What You See Is What You Get), Microsoft Front Page, or Front Page Express, because it is cheaper than the average Web design agency. However, for larger companies, investing in Web design software may not be enough. Developing and updating content requires a serious investment in human resources, and this is what the three large companies have done. However, the characteristics of a well-designed site varied from one company to another, and the Web site was developed in different ways (see Table 3).
Another important factor is the effective promotion of the site. The findings of this research support the studies of Evans and King (1999) and Hamill and Gregory (1997), who state that the effective marketing of a Web site is crucial for B2B IIM to succeed. Each company in this research used dif- ferent ways to promote its Web site. These included register- ing the site with different search engines, establishing recip- rocal cross-linkages to other sites, and ensuring that the URL address is used in all company correspondence (letterhead and all advertising and other publicity materials).
Our study also supports the findings of Hofacker (2001), Wil- son and Abel (2002), Kotab and Helsen (2000), and Quelch and Klein (1996) that language and communication are big
105Making B2B International Internet Marketing Effective
challenges for companies that use the Internet for their B2B marketing. Similarly, consistent with the findings of Quelch and Klien (1996), Samiee (1998), Simeon (1999), and Wood and Robertson (2000), culture plays a crucial role in B2B IIM. This is consistent with the idea that a company’s approach to attracting, informing, and positioning is greatly affected by the social and cultural environment in which it operates (Simeon 1999). All the interviewees in this research pointed out that they did a lot of work to understand the culture in foreign markets. However, whereas Petrolco and Electricco used local branches or offices as a tool to study the foreign markets, Textileco used its sales representative, local distrib- utors, and export manager to collect the required information about the culture of the foreign markets.
This study has taken an in-depth approach to investigating the ways that several B2B companies have responded to IIM. In particular, the questions raised in this article were related to how far the critical success factors, which we derived from the literature review, have been addressed to guide practi- tioners in responding to the new phenomenon of Internet marketing.
The case studies we present in this article examine the criti- cal success factors used by three companies in the petro- leum, textile, and electrical industries. The critical success factors have been introduced under the four subheadings of marketing strategy factors, internal factors, market factors, and Web site factors. Although we obtained these findings through the use of a cross- and within-case analysis, we found several dimensions to be common among these com- panies. We considered and analyzed similarities and differ- ences among the experiences of B2B IIM in three companies.
Table 3. Web Design Characteristics in Participating Companies
Company Web Design
Characteristics Consultant Developed
Petrolco •Design Australian company (Adweb)
Externally
•Up to date Internally
•Information (Internet manager)
•Easy to use
Electricco •Easy to search South African company
Outsourced
•Quality
•Information
•Easy to use
•Simplicity
Textileco •Ease of use U.K. company Internally (package)
•Speed of use
•Information
CONCLUSION AND RECOMMENDATIONS
106 Riyad Eid, Ibrahim Elbeltagi, and Mohamed Zairi
The description of these companies’ experiences of the fac- tors that affect the success of B2B IIM has provided many insights.
The preliminary study has many potential implications for further research that pertain both to methodology employed in collecting and analyzing the data and to the substantive findings of the research effort. However, during the course of this study, several findings indicated the need for further investigation. First, testing the developed conceptual frame- work using a large-scale sample will strengthen knowledge of the B2B IIM critical success factors. Second, it would be worthwhile to conduct a similar study of B2C companies on a comparative basis with the findings of the current study (which used B2B companies). The same proposed factors we developed for the current study could be employed in such a study. Third, another potentially fruitful area to develop is the quantification of these critical success factors into a “code-of-practice index” in a company to determine the level of performance on a time-based approach, such as year to year. The results from the index could pinpoint areas that need attention and improvement. Finally, each critical suc- cess factor we discussed in this study warrants more in- depth study. Although some critical success factors are recurring issues in marketing, information technology, and MIS research, their implications to Internet marketing require a new perspective. Further research could reveal the need to focus on one or more of the critical success factors to provide both theoretical and practical applications. On the one hand, researchers could use these factors to assess the success of B2B companies. On the other hand, these critical success factors must be subjected to review, critique, and dis- cussion for an extended period before gaining general acceptance. Additional items might be tried in each category.
Finally, as with any study, there are certain limitations that should be recognized. As we established previously, B2B IIM is an area of research in which theory is still under develop- ment. Thus, we opted to follow an exploratory approach in this study. This was necessary because the research must develop a holistic and integrative understanding of B2B IIM, a feature that demands broadening the scope of the study in reviewing a large body of relevant literature and collecting a huge set of appropriate data. Although we attempted to meet this requirement by reviewing various bodies of literature (marketing, information technology, and MIS) and seeking different types of data from both primary and secondary sources, it is not possible to claim that the empirical investi- gation in this study covered all the issues related to this per- spective, at least the issues presented in the literature. Time frame and limited access to organizational information are the main constraints.
107Making B2B International Internet Marketing Effective
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THE AUTHORS
Riyad Eid is Senior Lecturer of Marketing, Wolverhampton
Business School, University of Wolverhampton (e-mail:
Ibrahim Elbeltagi is Senior Lecturer of Information and
Knowledge Management, Faculty of Commerce, Mansoura
University, Egypt (e-mail: [email protected]).
Mohamed Zairi is Head of the European Centre for Total Quality
Management, School of Management, Bradford University
(e-mail: [email protected]).
ACKNOWLEDGMENTS
The authors sincerely thank the anonymous JIM reviewers for their
constructive and valuable comments and suggestions.
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