The Relationship between International Market Entry Mode Choice and Performance of Cross-Border E-commerce Enterprises

Abstract

Digital technologies have significantly transformed how international trade works; this created a new trend of companies that are now globally oriented, especially within the cross-border e-commerce (CBEC) industry. Businesses to these business, the proper selection an international market entry option is one of critical decision and has direct bearing on a firms profitability. This paper studies the complicated connections between various kinds of digital market entry methods and the performance of CBEC enterprises. In this study, the digital entry mode is divided into Third-party platform digital mode entry such as Amazon, Tmall Global and Proprietary self-built website entry and Social commerce-based entry. As a firm develops, its success or poor is seen as many things including sales growth, profitability, market share, brand recognition. Using a quantitative method, data was obtained through a survey of 285 CBEC firms. The one that was carried out to see the correlations and do multiple regressions shows difference results for each of these modes Findings showed that using 3rd party platforms was strongly connected with stronger short term financial performance, compared to building your own website which was connected with longer term market performance and brand equity. Social commerce appears as a kind of complement of great importance, improving the customer engagement and brand awareness thus contributing to performance. Further more, it is shown that the firms that adopt hybrid entry strategies, i.e., the ones that utilize more than one mode, outperform the sole strategy entry firms’ ones. These findings have some theoretical worth in the digital internationalization literature and offer actual information that can help CBECs’ managers when they start in different countries.