Business Model Innovation in e-commerce. A critical analysis of chances and challenges 1/2
Master’s thesis on business model innovation in e-commerce.
Welcome to our series of articles on current theses by our students!
Alumna Grisilda Miftari wrote an outstanding Master’s thesis in the field of social commerce as part of her Master’s degree at the Fresenius University of Applied Sciences in Cologne. The topic: “Business Model Innovation in e-commerce. A critical analysis of chances and challenges, especially in social commerce“. The first important findings of the thesis are presented below. You can already look forward to part 2!
Abstract
Social commerce is the new trend, that is impacting organization worldwide to adapt their business models. Thus, businesses should consider this new approach defined as business model innovation. Moreover, various firm are seeking towards the integration of technology and all different social media platform into their activities. Digitalization is impacting our lives and businesses in order to resist in the market should try to offer improved products and services and/ or new ones. This thesis aims to conduct critical literature review regarding the importance together with significance that is associated with business model innovation, with a focus on social commerce. The main objectives of this thesis are identifying various drivers and enables that influence firms to implement the new approach of innovating holistically the business model and applying innovative ways of doing business, via social media. Further, numerous barriers that businesses, users, and social media platforms are facing nowadays, are presented. Analyzing theoretical analysis is essential to identify what is considered important from different re-searchers. However, apart from literature review of relevant studies, the thesis follows a qualitative methodology and uses in-depth interviews as tool to collect data from at least six experts. The key findings are the technological advancement and social media platform presence in people’s life, as the main drivers towards social commerce; and the organizational mindset “resistance to change” and trust from the consumer’s perspective as the main barriers of social commerce. Additionally, the study concludes with useful recommendation for businesses, and research for potential studies in the near future. To conclude, a proposal of a conceptual model, that will provide necessary variables that needs to be tested on future research.
Social Commerce
Social commerce is quickly expanding, with massive economic and societal implications. Businesses of all sizes and sectors are scrambling to incorporate technology and social media into their operations. Hence the need to create an effective framework is significant and will guide and assist them in incorporating social media into their virtual presence. However, there is an absence of a complete model to form social commerce representing an essential company operation, so few organizations have adopted efficient s-commerce (Huang & Benyoucef 2013). Relatively few researchers have been concentrated on social commerce starting to the standpoints of model creation (Baghdadi 2016, Huang & Benyoucef 2013, Wu, Xu, Mo & Liao 2015)
Opportunities and barriers
The enormous popularity and impact of social media, along with the advent of mobile commerce, has created a massive potential market for online shopping experience. Revenue from social commerce is predicted to grow year after year, from $26 billion USD in 2020 to $69 billion USD in 2024. By 2023, social commerce will account for 14.3 percent of the overall retail ecommerce sales in China. Approximately one-third of US consumers have utilized social commerce, but fewer than one-tenth do so on a regular basis, demonstrating the enormity of the unmet clientele. The Global Social Commerce market is predicted to reach $2.9 trillion USD latest 2026 (Global Industry Analysts 2021).
References:
Huang, Z. & Benyoucef, M., 2013, ‘From e-commerce to social commerce: A close look at design features’, Electronic Commerce Research and Applications, 12(4), 246 – 259.
Wu, J., Xu, M., Mo, Z. & Liao, L., 2015, ‘The research of design based on social commerce’, International Journal of Social Sciences Studies, 3, 157.
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