Research Insights 14.2 Customer Orientation Structure for Internet-Based Business-to-business platform firms

Channels, Supply Chains, and Retailing

Source: Chakravarty, A., Kumar, A., and Grewal, R. (2014). Customer orientation structure for Internet-based business-to-business platform firms. Journal of Marketing, 78(5), 1–23.

Abstract: Internet-based business-to-business platforms involve a buyer side transacting with a seller side, both of which are customers of an intermediary platform firm. Dyadic viewpoints implicit in conventional theories of customer orientation thus must be modified to apply to a triadic relationship system (seller--platform--buyer) in platform settings. The authors propose that customer orientation of platform firms consists of total customer orientation (customer orientation toward both the buyer and seller sides) and customer orientation asymmetry (customer orientation in favour of the seller relative to the buyer side) and examine the antecedents and consequences of these orientations. Data from 109 business-to-business electronic platforms reveal that buyer- (seller-) side concentration increases total customer orientation and customer orientation asymmetry toward sellers (buyers). These positive effects are weaker when buyers and sellers interact directly (two-sided matching) versus indirectly (one-sided matching) and are stronger when the offering prices vary (dynamic price discovery) versus remain stable (static price discovery) during negotiations. Finally, total customer orientation increases platform performance by itself and in interaction with customer concentration, but orientation asymmetry increases performance only in conjunction with customer concentration.

Insight:

This article develops a two-dimensional conceptualization of customer orientation for Internet-based B2B platforms, aiming to understand the unique challenges of platforms offering a triadic exchange system involving a seller side, a buyer side, and the intermediary platform. It thus reflects the premise that this type of intermediary must satisfy the needs of both buyers and sellers, both of whom are customers of the platform.

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