Understanding B2b E-market Alliance Strategies

In the recent rapidly changing environment of the Digital Economy, business-to-business (B2B) electronic markets are adopting cooperative strategies in lieu of competitive strategies in order to obtain resources so that they can succeed in the market. This paper aims to develop formal theory-based understanding of a range of observed cooperative strategies by conducting an empirical study of B2B emarket strategic alliances. We draw upon research on strategic alliances, intermediation and market structure to explore the factors that motivate firms to enter into interorganizational alliances, and make choices about how to structure and provide governance mechanisms for them. We employ data from various secondary sources, and address questions about the motivation, structure and impact of alliances. We investigate the frequency of alliances that B2B e-markets form by testing a Poisson count model. We explain how B2B firms choose alliance structures and whether the cooperative strategy affects the success of B2B e-markets by using two different binomial logistic regression models. Our results show that leading B2B e-markets tend to set up cooperative relations more frequently. They also show that strategic alliances are more likely to involve high levels of interdependence in governance (e.g., joint equity ownership), if partners are buyers or suppliers in the online marketplace. However, our results indicate that the survival of B2B e-markets is not significantly related to the number of alliances they form.