Abstract
This study examines whether the quality of online buying experience represents a competitive advantage for Internet firms focused on business to consumer e-commerce (“e-commerce” firms). Forrester Research, a consulting firm, estimates that revenues in the business to consumer segment will grow from $20 billion in 1999 to $184 billion by 2004. Such explosive growth is due, in part, to the superior shopping experiences that new e-commerce firms offer. Jeff Bezos, the chief executive officer (CEO) of Amazon.com, contends that the popularity of his company’s Web site is due to the superior shopping experience that Amazon.com offers (Taylor 1996, p. 132): “Bill Gates laid it out in a magazine interview. He said, ‘I buy all my books at Amazon.com because I’m busy and it’s convenient. They have a big selection, and they’ve been reliable.’ Those are three of our four core value propositions: convenience, selection, [and] service. The only one he left out is price: we are the broadest discounters in the world in any product category. . . . These value propositions are interrelated, and they all relate to the Web.” Consistent with this idea, the resource-based view in the strategy literature (e.g., Wernerfelt 1995) posits that creating unique online buying experiences that cannot be easily imitated by the firm’s rivals can lead to a sustainable competitive advantage and long-run economic value.