The Influence of the Provision of Online Channel Functions on Exporting Channel Performance: The Moderating Effect of International Experience

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The Influence of the Provision of Online Channel Functions on ExportingChannel Performance: The Moderating Effect of International ExperienceMichael Chih-Hung Wanga; Shadab Khalilb; Charles Blanksonc; Julian Ming-Sung Chengbd

a Marketing Research Center of the Department of Business Administration, National CentralUniversity, Taiwan b Department of Business Administration, National Central University, Taiwan c

Department of Marketing and Logistics, University of North Texas, Denton, Texas, USA d Departmentof Marketing, Georgia State University, Atlanta, Georgia, USA

Online publication date: 13 April 2011

To cite this Article Wang, Michael Chih-Hung , Khalil, Shadab , Blankson, Charles and Cheng, Julian Ming-Sung(2011)'The Influence of the Provision of Online Channel Functions on Exporting Channel Performance: The Moderating Effectof International Experience', Journal of Global Marketing, 24: 2, 125 — 135To link to this Article: DOI: 10.1080/08911762.2011.558811URL: http://dx.doi.org/10.1080/08911762.2011.558811

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Journal of Global Marketing, 24:125–135, 2011Copyright c© Taylor & Francis Group, LLCISSN: 0891-1762 print / 1528-6975 onlineDOI: 10.1080/08911762.2011.558811

The Influence of the Provision of Online Channel Functionson Exporting Channel Performance: The Moderating Effect

of International Experience

Michael Chih-Hung WangShadab Khalil

Charles BlanksonJulian Ming-Sung Cheng

ABSTRACT. The purpose of this research is to investigate the effect of the provision of two onlinechannel functions on exporting channel performance, using international experience as a moderatingvariable. The study setting is Taiwan. The results confirm that the provision of online communication andtransaction functions can increase exporting channel performance. Moreover, international experiencecan better facilitate the effect of the provision of online transaction functions on exporters’ channelperformance for less-experienced firms rather than for experienced firms. However, its facilitationreverses in course of the provision of online communication functions (albeit in a different directionthan hypothesized).

KEYWORDS. Internet, channels of distribution, channel function, exporting, performance

RESEARCH BACKGROUND

The ubiquity of the Internet can be benefi-cial for channels of distribution to reduce dis-tance and time zone constraints (Bennett, 1997;Hamill & Gregory, 1997). This is especiallyimportant for cross-border business activities

Support for this study was provided in part by the National Science Council of Taiwan (No. NSC 97-2923-H-008-001-MY3).

Dr. Michael Chih-Hung Wang is a postdoctoral research fellow in the Marketing Research Center ofthe Department of Business Administration, National Central University, Taiwan. Shadab Khalil is a doc-toral candidate in the Department of Business Administration, National Central University, Taiwan. CharlesBlankson is Associate Professor in the Department of Marketing and Logistics, University of North Texas,Denton, Texas, USA. Julian Ming-Sung Cheng is Visiting Scholar in the Department of Marketing, GeorgiaState University, Atlanta, Georgia, USA, and Associate Professor of Marketing in the Department of BusinessAdministration, National Central University, Taiwan.

Address correspondence to Michael Chih-Hung Wang, Marketing Research Center of the Department ofBusiness Administration, National Central University, No. 300, Chung-Ta Road, Chung-Li City, Tao-YuanCounty, Taiwan 32001. E-mail: [email protected]

such as exporting. The replacement of physi-cal channels by the Internet not only enablesexporters to control their exporting process (An-dersen, 2005) and handle their transactions ata lower cost (Lohrke, Franklin, & Frownfeller-Lohrke, 2006) but also enables exporters to seizemore business opportunities in the international

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126 JOURNAL OF GLOBAL MARKETING

marketplace (Prasad, Ramamurthy, & Naidu,2001). The Internet as an exporting channel ofdistribution has thus come of age.

The purpose of using channels of distributionis to implement channel functions (Coughlan,Anderson, Stern, & El-Ansary, 2006). Channelfunctions are activities and services that addvalue to goods when they move from manu-facturers to customers (Atwong & Rosenbloom,1995) and can be classified into three categories:communication, transaction, and delivery func-tions (Peterson, Balasubramaniam, & Bronnen-berg, 1997). In an exporting context, the ubiq-uitous nature of the Internet allows firms toimplement communication functions (e.g., col-lecting foreign customer information and com-municating with them) and transaction func-tions (e.g., placing orders, making payments,and generating sales) more effectively and ef-ficiently (Aspelund, Madsen, & Moen, 2007;Dou, Nielsen, & Tan, 2002; Prasad et al., 2001;Quelch & Klein, 1996). However, the physicalcharacteristics of goods make delivery functionsthrough the Internet difficult (Peterson et al.,1997; Van den Poel & Leunis, 1999). The useof the Internet for channel function implemen-tation (i.e., as a channel of distribution) allowsexporters to easily handle customer communi-cation and transactions (Andersen, 2005), andexporters can eventually benefit (Lohrke et al.,2006).

The significance of the Internet as an ex-porting channel of distribution has apparentlymotivated a limited body of research interestrelated to the implementation of online channelfunctions and exporting performance (Lu &Julian, 2007; Moen, Madsen, & Aspelund,2008; Morgan-Thomas & Bridgewater, 2004).In their research model, Morgan-Thomas andBridgewater (2004) examine the relationshipbetween the provision of overall marketingfunction and exporting performance in theUnited Kingdom; although supportive resultsare obtained, their study does not specificallyaddress individual channel functions. Moenet al. (2008) conceptualize communication andtransaction functions as performance facilitatorsin international markets but fail to identify anyrelationship between these studied constructs inthe United States. Lu and Julian (2007) test only

the impact of the implementation of a single typeof online channel function, i.e., communication,on exporting success in Australia and their workyields supportive results.

It is important to note that not only does theglobal marketing literature lack sustained em-pirical works on the subject in economies otherthan developed nations but also inconclusive re-sults are found in the existing literature (seeearlier). Thus, the nature of these studies andtheir resultant findings call for more investiga-tions, especially in less-developed economies.Given the growing importance of less-developedeconomies in international trading (Braddeley,2006; Kuada & Buatsi, 2005), this is an im-portant research task. Moreover, while stud-ies have examined overall marketing functionor investigated the current subject based on asingle channel function perspective, integratedstudies geared toward exploring the simultane-ous effects of individual channel functions onexporting channel performance have receivedmeager research attention—hence, the currentresearch. The extant literature also notes thatinternational experience plays a dominant rolein conventional exporting performance (Aulakh& Kotabe, 1997). In the exporting context, theadoption/use of the Internet for business purposeis based on the contingency of international ex-perience (Geyskens, Gielens, & Dekimpe, 2002;Moon & Jain, 2007; Morgan-Thomas & Bridge-water, 2004). It is therefore reasonable to expecta moderating effect of international experienceon the current study subject. In view of the fore-going discussion, an attempt is made here to fillthe gaps in the literature. Specifically, the pur-pose of this study is to investigate the simultane-ous effects of the two channel functions (onlinecommunication function and online transactionfunction) on exporting channel performance inTaiwan, a newly industrialized economy. Ex-porting experience is examined as a moderator.The current research is deemed to provide a com-prehensive and solid understanding of the sub-ject and is practically and theoretically relevantfor the global marketing literature.

In the next section, the development ofresearch hypotheses is discussed. Researchmethodology and data analysis follow. Conclu-sions and discussion are then presented. Finally,

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FIGURE 1. Proposed Research Model, Related Hypotheses, and Test Results

H1: 0.29***

H2: 0.09*

H3: 0.15**

International experience Exporting

channel performance

Online

communication function

Online transaction function

H4: –0.10*

Number of

employees

Annual

sales

R2 = 0.17

–0.01 –0.14**

Dotted outline refers to control variables. Significance level: p < .05. *** p < .01. ***p < .001.

implications for business marketing practice arediscussed.

RESEARCH HYPOTHESES

As noted previously, the current research isconcerned with the examination of the provisionof online communication and transaction func-tions as predictors of exporting channel perfor-mance, with exporters’ international experienceacting as a moderator (Figure 1).

The Provision of Online ChannelFunctions and Exporting ChannelPerformance

In this research, online communication func-tions refer to the online availability of informa-tion related to exporters’ products and servicesas well as market-related information. Onlinetransaction functions allow foreign customersto complete tasks related to order-placementthrough the Internet (Houghton & Winklhofer,2004). The provision of online communicationallows firms to update their information con-veniently, efficiently, and in a timely fashion(Lohrke et al., 2006). This ability can improvethe efficiency of information dissemination (Pe-terson et al., 1997). Customers thus have greater

control over the search for and the acquisitionof information (Hoffman & Novak, 1996). Theprovision of online transaction functions allowscustomers to place orders, check product deliv-ery status, make payments, request and acquiretechnical support, and obtain purchase assis-tance from the Internet, thus improving trans-action efficiency (Chakraborty, Lala, & Warren,2003; Dou et al., 2002). Due to the interac-tive capabilities of the Internet, the provision ofthese two types of channel functions will also al-low firms to easily handle individual customers’needs and promptly respond to individual cus-tomers in a flexible way (Peterson et al., 1997).All of these advantages encourage customers tointeract with firms that provide online commu-nication and transaction functions.

Distance and time zone barriers are two ma-jor and serious constraints in the internationalmarketplace (Amit & Zott, 2001; Bennett,1997) because they can render communicationand transactions between firms inefficientand ineffective. The ubiquity of the Internetenables exporters to cope with the effect of suchconstraints. Thus, the provision of online com-munication and transaction functions for foreigncustomers is important to exporters as this isan easy, convenient, and comprehensive wayto facilitate interaction (Mahadevan, 2000) andto enhance the business between exporters and

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their foreign customers across borders. Accord-ing to the Use and Gratification Theory (Katz,Blumler, & Gurevitch, 1974), the satisfactionof needs through online channel functions willmotivate foreign customers to search for andacquire information and place/confirm ordersthrough exporters’ websites rather than contactexporters through offline avenues. Transactionsthrough online mechanisms therefore increase(Bhatnagar, Misra, & Rao, 2000), and exportingchannel performance is enhanced. Based onthese inductive arguments, we hypothesize that:

H1: The greater the provision of online com-munication functions, the better the export-ing channel performance will be.

H2: The greater the provision of online trans-action functions, the better the exportingchannel performance will be.

International Experience as a Moderator

International experience concerns the under-standing of realistic issues relating to businessoperations, risks, returns, and so on in the inter-national marketplace (Stopford & Louis, 1972).International experience plays an important rolein influencing exporting success in the conven-tional exporting context (Katsikeas & Morgan,1994; Nakos, Brouthers, & Brouthers, 1998).Experienced exporters are more likely to placegreat importance on how to adapt to foreignmarket forces in the course of satisfying theirmarket demands (Gregory, Karavdic, & Zou,2007). Conversely, less-experienced exporterslack country-specific knowledge and are unfa-miliar with issues regarding exporting channelsof distribution (cf., Morgan-Thomas & Bridge-water, 2004).

In comparison with less-experienced ex-porters, experienced exporters are constrainedby their prior experience and their abil-ity/willingness to respond to the adoption of theInternet in their exporting operations (Geyskenset al., 2002). Although they may start to offer on-line communication and transaction functions,the costs of adopting and learning new technolo-gies and related skills, as well as the possibilityand the necessity of relinquishing certain busi-ness practices associated with traditional phys-

ical media (cf., Chiou & Droge, 2006), mayencourage staff members to continue to prefertraditional approaches to conduct business withforeign customers. This also applies to their for-eign customers who may not be willing to use on-line communication and transaction functions.Therefore, exporting transaction efficiency andperformance will not improve to the levels de-sired or anticipated prior to the implementationof these channel functions. That is, internationalexperience appears not to be so beneficial to ex-perienced exporters when they adopt the Internetas a channel of distribution (cf., Quelch & Klein,1996).

In contrast, less-experienced exporters (i.e.,with less international experience) who possessfewer resources are likely to be motivated tocommit to the Internet technology and to devotemore effort in making online channel func-tions workable (Morgan-Thomas & Bridgewa-ter, 2004). This is because the Internet allowsthem to gain a relatively quick understand-ing of the international marketplace, reduceforeign market uncertainty, and better main-tain exporting processes at an affordable cost(Andersen, 2005; Peterson, Welch, & Liesch,2002). Thus, they are likely to rely heavily onthis medium to reach their foreign customers.At the same time, because their foreign cus-tomers have few alternatives, they will be forcedto communicate and place orders with themthrough the Internet. To that end, because ofthe inherent capacity of the Internet to improveefficiency and effectiveness, less-experiencedexporters can, as a result, enhance their per-formance more dramatically than can experi-enced exporters. Previous empirical evidencehas shown that compared with experienced ex-porters, less-experienced exporters achieve suc-cess more easily when they adopt the Internetas their channels of distribution (e.g., Geyskenset al., 2002; Morgan-Thomas & Bridgewater,2004).

The aforementioned reasons lead to the con-clusion that international experience (i.e., ofexperienced or less-experienced exporters) willmoderate the effects of providing online chan-nel functions on exporting channel performance.Based on the above argument, we therefore pro-pose the following hypotheses:

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H3: The provision of online communicationfunctions will benefit less-experienced ex-porters more on their exporting perfor-mance than experienced exporters.

H4: The provision of online transactionfunctions will benefit less-experienced ex-porters more on their exporting perfor-mance than experienced exporters.

RESEARCH METHODOLOGY

Data Collection

The research sampling frame was the Tai-wan Exporters Directory (TED). This directoryis compiled and published by the Taiwan Ex-ternal Trade Development Council (TAITRA)and the Taiwanese government. Therefore, theTED directory is deemed a comprehensive andextensive source of exporters in Taiwan. Ex-porters listed in the TED directory were manu-ally screened in an attempt to target qualified par-ticipants who used websites for exporting pur-poses. This yielded 3921 qualified exporters forthe purposes of this study.

Prior to the survey, invitation letters wereemailed to senior managers at the identified ex-porting firms. The senior managers responsiblefor exporting business operations were identi-fied as key informants in the current research(Kumar, Stern, & Anderson, 1993). Then e-questionnaires were sent to these senior man-agers. Two follow-up waves of e-questionnaireswere sent and 275 useable e-questionnaires wereeventually collected, resulting in an acceptableresponse rate of 7.01% (see Simsek & Veiga,2000).

Measurement Instruments

Research scales were operationalized mainlyon the basis of previous works. In line with goodpractices in the literature, modifications weremade to fit the current research context and pur-pose. For all scale items, a 5-point Likert scalewas used.

Modified from Chakraborty et al. (2003) andDou et al. (2002), the two research predictors“online communication functions” and “onlinetransaction functions” were measured with a 5-

item scale and a 4-item scale, respectively. Theonline communication function scale consistedof the following items relating to the provi-sion of online information: “general informa-tion about the company,” “trade specific usageinformation,” “trustworthy information,” “com-prehensive information about available prod-ucts,” and “electronic contact means on thewebsite.” The online transaction function scalecomprised of items relating to online pur-chase: “making purchase through the website,”“online order/shipment status checking,” “on-line purchase assistance,” and “online technicalsupport.”

Adopting the suggestions of Katsikeas et al.(2000), Sousa (2004), and Zhou (2007), the re-search outcome (i.e., exporting channel perfor-mance, was measured by a proxy indicator: asubjective conceptual question referring to anincrease in exporting sales growth in the caseof online channel function provision. The useof such a self-reporting subjective question asan exporting performance proxy was promptedby the difficulty of accessing valid archival datain research settings (Haahti, Madupu, Yavas,& Babakus, 2005). Firms in Taiwan typicallydo not distinguish their exporting activity per-formance from their overall financial perfor-mance in their financial statements and theyare reluctant to disclose their confidential fi-nancial indexes to the public if unnecessary.Self-reporting of subjective performance mea-sures are often used in export marketing studies(Leonidou, Katsikeas, & Samiee, 2002), and nodifference in single-item and multiple-item per-formance measures is found by Kirca, Jayachan-dran, and Bearden (2005). Therefore, the currentexporting performance measure was deemed re-liable. The research moderator, international ex-perience, adapted from Ramaseshan and Patton(1994) and Zhou (2007), was measured using thequery about the number of years the participat-ing exporter had been involved in the exportingbusiness.

In order to minimize the possible sources ofsystematic errors that might bias the analysisresults, two indicators (i.e., number of employ-ees and annual sales) were introduced as controlvariables. The more employees a firm has, thegreater the conflict, whereas the less employees

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TABLE 1. A Profile of the Sampled Exporters

Number ofEmployees Freq. %

Number ofExporting Managers Freq. %

1–10 38 13.8 1–2 96 34.911–50 125 45.4 3–5 128 46.551–100 42 15.3 6–8 33 12.0101–150 50 18.2 9–10 4 1.5> 150 20 7.3 >10 14 5.1Total 275 100.0 Total 275 100.0

Number ofYears in Annual SalesThis Field Freq. % (in millions of TWD) Freq. %

≤ 2 7 2.5 <1 12 4.43–5 29 10.5 1 to <5 28 10.26–10 65 23.6 5 to <10 72 26.211–15 50 18.2 10 to <100 105 38.2> 15 124 45.2 ≥ 100 58 21.0Total 275 100.0 Total 275 100.0

Note. TWD (Taiwan Dollar) 1 = USD 0.03.

a firm has, the higher is the likelihood of cooper-ation between employees (Cadogan, Sundqvist,Salminen, & Puumalainen, 2005). In addition,the higher the sales, the lower is the transactionalcost (Lohrke et al., 2006). As both of these in-dicators might affect a firm’s performance, theywere taken as control variables and coded asdummy variables in the data analysis. Their pos-sible effects on performance were, accordingly,assessed.

DATA ANALYSIS

Sample Description

The profile of the participants from the dataset is presented in Table 1. Almost half of the par-ticipating exporters (45.4%) maintained a staffof 11 to 50 employees. The majority of the ex-porters (81.4%) had fewer than six exportingmanagers. Slightly more than two fifths of ex-porters (45.2%) had been involved in their busi-ness for 16 or more years. Around 60% of themhad revenues of more than TWD 10 million peryear (exchange rate at TWD [New Taiwan Dol-lar] 1 = USD 0.03).

Assessment of the Measurements and theProposed Structural Model/Hypotheses

The variance-based structural equation mod-eling technique, partial least squares (PLS), andspecifically the computer application SmartPLS(Ringle, Wende, & Will, 2005), was used forthe analysis of the research measurements, thestructural model, and the research hypotheses.PLS considers all path coefficients simultane-ously and estimates multiple individual itemloadings in the context of a theoretically speci-fied model rather than in isolation; thus it enablesresearchers to circumvent biased and inconsis-tent parameter estimates for equations (White,Varadarajan, & Dacin, 2003). PLS is not re-strained by the sample size and does not requirenormal distribution of the data (Chin, Marcolin,& Newsted, 2003). More importantly, the cur-rent research used exporter experience as a mod-erator, measured using a continuous scale, andhence the traditional covariance-based structuralequation modeling technique (i.e., LISREL) wasnot considered suitable for such an analysis.Maximum likelihood techniques such as LIS-REL require multivariate normality of the data,and the presence of an interaction term violatessuch a requirement. On the other hand, becausePLS is distribution free, it is not constrained bysuch requirements (Wuyts & Geysken, 2005).

Reliability and Validity

Due to the nature of the scales, only the relia-bility and the validity of the two channel functionscales (i.e., communication functions and trans-action functions) were examined. The descrip-tive and scale accuracy statistics of the two scalesare presented in Table 2. The analysis summaryis discussed next.

Scale reliability was assessed using the C.R.(Composite Reliability) index. The C.R. valuesof both the channel function scales were higherthan the scholarly recommended threshold of .7and thus the scales were deemed reliable. Totest scale convergent validity, the factor load-ings of the items of each scale were examined.Because the current research adapted measure-ment scales from previous literature, a thresholdof .5 was used (Yoo & Alavi, 2001). All the

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TABLE 2. Descriptive Statistics and Scale Accuracy Analysis

Item-to-Construct Correlation

Research ConstructsMeanValue* SD

CRValue Loading

OwnConstruct

HighestCross-Correlation

HighestSV

OCFICF−1 4.59 0.58 .73 .63 .63 .23 .36ICF−2 .51 .51 .17ICF−3 .69 .69 .25ICF−4 .61 .61 .23ICF−5 .50 .50 .18

OTFITF−1 3.55 1.11 .73 .61 .61 .09 .16ITF−2 .58 .58 .08ITF−3 .71 .71 .14ITF−3 .63 .63 .11

Note. OCF = Online communication functions; OTF = online transportation functions.∗Scores: 1 = strongly disagree; 3 = neutral; 5 = strongly agree.

item factor loadings of both the channel func-tion scales were higher than 0.5, hence pro-viding evidence for convergent validity. Scalediscriminant validity was assessed by examin-ing: (a) the AVE (average-variance-extracted)value (i.e., both constructs’ AVE values to behigher than the shared variances [squared cor-relations between constructs] between the twoconstructs) and (b) the item cross-loading (i.e.,each item’s loading to be higher for its ownconstruct than for the other construct). For boththe channel function scales, the AVE values ex-ceeded the shared variance among the two con-structs and all the item loadings were higherthan the cross-loadings for both the constructs.Therefore, evidence of discriminant validity wasensured.

The Structural Model and HypothesisTesting

In line with Reinartz, Krafft, and, Hoyer(2004) and Karimi, Somers, & Bhattacherjee(2007), the current research analyzed the maineffects, the interaction effects, and control vari-ables together in one model. The interactionterms for the two moderating effects were cre-ated and included in the model. The two controlvariables were also included in the model. Theresults of the assessment of the proposed hy-potheses are presented in Figure 1 and Table 3.

R2 was evaluated to assess the model fit of theproposed model, and a criterion of R2 higherthan .10 was used (Falk & Miller, 1992). TheR2 for channel performance was .17, suggesting17% variance in the outcome variable, whichimplied a satisfactory and substantive model. Abootstrapping resampling procedure (500 sam-ples) to test the proposed hypotheses using t teststhen followed. The results of bootstrapping re-sampling procedure indicated that both of themain effect hypotheses coefficients were statis-tically significant and in the proposed direction.That is, online communication functions (stan-dardized coefficient: .29, p < .001) and onlinetransaction functions (standardized coefficient:.09, p < .05) had significant, positive effects onexporting channel performance. Therefore, H1

TABLE 3. Standardized Coefficients of theProposed Hypotheses

Main effectsH1 (online communication functions) .29∗∗∗H2 (online transaction functions) .09∗

Interaction effectsH3 [(online communication functions) *(international experience)]

.15∗∗

H4 [(online transaction functions) *(international experience)]

−.10∗

R2 .17

∗p < .05. ∗∗p < .01. ∗∗∗p < .001.

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and H2 were both supported. An examinationof the results of the moderating effect hypothe-ses suggested that experienced exporters gainedmore in terms of exporting channel performancewhen online communication functions were pro-vided (standardized coefficient: .15, p < .01; al-beit in a different direction than hypothesized),while reverse condition was found after the pro-vision of online transaction functions (standard-ized coefficient = –.09, p < .05). Thus, H3 wasnot supported, whereas H4 was supported. Fur-thermore, analysis of the control variables indi-cated that the number of employees had a signif-icant effect (standardized coefficient: –.14, p <

.01), whereas annual sales (standardized coeffi-cient: –.01) did not have a significant effect onthe channel performance of the firm.

CONCLUSIONS AND DISCUSSION

This research attempts to investigate the pro-posed premises that the provision of communi-cation and transaction functions on exporters’websites can increase firms’ exporting channelperformance. The research findings support thepremises. The research also introduces a de-terminant factor, i.e., international experience,which moderates the above relationships. Theresearch results reveal that international experi-ence can better facilitate the effect of the provi-sion of online transaction functions on exporters’channel performance for less-experienced firmsthan for experienced firms. However, the influ-ence of international experience is more signifi-cant for experienced exporters when online com-munication functions are provided (albeit in adifferent direction than hypothesized). A possi-ble explanation for the reverse result might bethat less-experienced exporters are perceived tolack resources and requisite knowledge and thatthey might not be capable of distributing keyand accurate information. Thus, their informa-tion is perceived less reliable than that providedby experienced exporters. The information pro-vided by less-experienced exporters might onlybe taken as complementary to the informationacquired from other sources and may not sat-isfy foreign customers’ needs. This perceptionmay reduce the likelihood of foreign customers

choosing to interact with less-experienced ex-porters and as a result may not increase the per-formance of less-experienced exporters as muchas expected.

Managerial Implications for BusinessMarketing Practice

Based on the results of this research, sev-eral implications for business marketing prac-tice, especially for exporters, are identified anddiscussed next. According to the findings, theprovision of abundant product information andthe facility of online order placement will gener-ate greater opportunities for foreign customersto transact business with exporters, and even-tually, the provision of the two types of chan-nel functions will enhance exporters’ exportingchannel performance. However, the informationposted on websites should be perceived to be re-liable and trustworthy. It should not be limitedto company profiles, product information, phys-ical and electronic contact means, and marketand industrial-related information. Local cus-tomized information such as local trading andselling information presented using local lan-guages (i.e., local language websites) shouldbe provided as well. The provision of trans-action functions should not be limited to sell-ing terms such as pricing information and orderplacement. Online assistance such as FAQs (fre-quently asked questions) regarding the onlineordering process should be provided to help for-eign customers to complete online transactions.Other online transaction functions/mechanismsthat add value to online transactions (not applica-ble through physical channels), such as allowingforeign customers to check stocks, confirm or-ders, and trace shipments and delivery statuses,will encourage potential foreign customers totransfer their business from physical processesto online transactions. These value-added mech-anisms can also enhance current customers’ loy-alty to their online exporting partners. In the end,these will prompt foreign customers to com-plete transactions with exporters and enhanceexporters’ exporting channel performance.

There are also significant findings in relationto the research question regarding whether inter-national experience moderates the relationship

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between online channel function provision andexporting channel performance. The findingssuggest that less-experienced exporters arelikely to benefit in terms of exporting channelperformance when online transaction functionsare provided. This effect is countered by thereverse finding in the case of online commu-nication provision—that experienced firmscan better facilitate their exporting channelperformance. Such findings imply that forless-experienced exporters, the provision oftransaction functions is pivotal for their ex-porting channel performance. Less-experiencedexporters lack adequate resources and thereforeputting more focus on providing online transac-tion mechanisms at their initial exporting stagecan be a rewarding strategy to achieve their goalof improving exporting channel performancewith limited resources. The provision of abun-dant communication information will be coun-terproductive for less-experienced exporterscompared with the provision of online trans-action functions. Therefore, less-experiencedexporters might maintain only a limited range ofinformation online that is considered to be crit-ical to their foreign customers. For experiencedexporters, the research results indicate that theprovision of communication functions can bebeneficial in enhancing their exporting channelperformance. They can therefore provide awealth of information and design a good mech-anism for browsers to quickly access requiredinformation. Encouraging browsers to upload in-formation to expand their information databaseis another way to provide a large amount ofinformation at low cost. Eventually, foreigncustomers may view such websites as an indus-trial portal site to access required information ora community center to meet potential businesspartners. Experienced exporters can exploit theadvantages and enhance their competitive edge.

Limitations and Future ResearchDirections

Although the current research is based ona robust literature review and empirical analy-sis, there remain some research limitations thatprovide avenues for future research. A possi-ble extension of the current research is to in-

vestigate delivery functions and in the contextof digital goods, such as software and music,and services. The resulting findings may thenbe compared with that of the current research.It is possible that the two results may indicatemoderating effects of various product attributes.Product complexity, a sort of product attributes,might affect the access of online information andeventually online transaction (Pavlou & El Sawy,2002). As such, product complexity may mod-erate the current research model. The currentresearch may be replicated in multiple countryenvironments. Different results across countriesare likely to suggest that culture and the level of acountry’s economic development can be interac-tive/moderating variables (Blankson, Cheng, &Spears, 2007). As the use/acceptance of the In-ternet varies across industrial levels (Ciciretti,Hasan, & Zazzara, 2009; Eliashberg, Swami,Weinberg, & Wierenga, 2009), industrial sec-tors may play a moderating role as well. Allthese factors deserve future exploration. In addi-tion, exporters and their foreign customers whobecome used to the conventional offline, physi-cal relationship–building approach are likely toresist doing business through the Internet (c.f.,Mostafa, Wheeler, & Jones, 2006). Thus, vari-ance comparison between those who prefer andthose who dislike an online business relationshipin the current research model is worth examin-ing. Last, but not least, because this researchfocuses on the discussion of exporting channelperformance, it will be beneficial for future re-search to probe whether the introduction of chan-nel functions through the Internet can be advan-tageous to exporters’ foreign distributors, trad-ing agents, or local clients. Such issues warrantfuture investigation.

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