Benefits of using offline & online methods in the internationalization process : A study of e-commerce companies in Sweden

Sammanfattning: Technical advances have made it possible for small enterprises to go international already at inception since the internet has made the internationalization process cost-effective. With the existence of the offline and online arena, the companies have to consider how they allocate their resources between these fields; not allocating resources to offline methods can save money, but could reduce adaptation to the new market which can lead to reduced firm performance. However, overspending on offline methods can be costly and could jeopardize the financial stability of the company. Although this is noted by previous research, little is still known about how companies balance the resources between online and offline presence. Especially when it comes to e-commerce companies and how the benefits of online and offline presence are balanced by this type of firms in their expansion into foreign markets. This is also what is meant to be explored in this paper. The data has been collected through semi-structured interviews with seven Swedish e-commerce companies that have internationalized their operations in an active way. The results show that online and offline benefits can be divided into four categories, namely local knowledge, local connection, promotion and services. These categories could in turn bring benefits to the company that are either substitutable, non-substitutable or complementary. The findings indicate that firms could balance their resources in online and offline presence in order to gain benefits that cannot be found in the counterparts of each presence. This could be of interest for entrepreneurs and managers that plan to engage in internationalization within e-commerce.