R000239472 – Putting e-commerce in its place: constructing electronic times and spaces

Funded by the Economic and Social Research Council

Award/Grant Name: Putting e-commerce in its place: constructing electronic times and spaces

Award/Grant Holders: Andrew Leyshon, Shaun French, Louise Crewe and Nigel Thrift.

Duration: November 2001 – January 2004

For the full End of Award Report, click here and for a Project Summary click here

Non-Technical Summary

The research focuses on e-commerce from producers’ perspectives, and sets out to investigate claims (made before and during the dot.com boom) that the internet would fundamentally change the relationship between supplier and consumer.

Detailed observation of organisations in the sectors chosen – music, fashion, and retail financial services – constituted the bulk of the research activity. Interviews and analysis of texts were also undertaken.

The main objectives were (in brief):

  1. To modify the concept of ‘virtualism’ to incorporate a broader set of participants beyond academic economists, and to include types of abstractions outside formal economic theories.
  2. To analyse ways in which such ideas and concepts are translated into practices.
  3. To produce an audit of the e-commerce knowledge community (EKC)
  4. To consider the take up of ideas and concepts among managers in the chosen industries.
  5. To map the material impact of e-commerce on the chosen industries.
  6. To consider the ways in which e-commerce has forged new interaction between companies and consumers, and the effects of its outcome.

Key findings

  1. Broadly, virtualism is the translation of abstract ideas and concepts into material form. The dot.com boom was integral to transforming ideas to reality, and then to acceptance as the norm.
  2. Following the dot.com collapse in April 2000, the role of e-commerce was fundamentally reassessed. Dot.com companies faced the same success criteria as traditional business – sufficient revenue has to be generated to cover the cost of capital and make profits. This led to a change in the assessment of the desired outcome for many e-commerce activities. Most companies now have web sites, but for a variety of purposes. Many are not directly aimed at, nor designed to make sales, but used for promotion, information dissemination, research, assessment of success/failure and other measurements.
  3. Evidence supported the hypothesis that a discernable EKC has emerged, and that it is a more diverse and dynamic group than originally envisaged, with boundaries which are constantly shifting. The ECK is wide ranging, encompassing management consultancies, business schools, the media, etc. at one end, and practitioners such as software and technology providers at the other.
  4. Practical, incrementally gained, and even mundane knowledge was frequently more influential in shaping e-commerce than researched theory and concepts, particularly for smaller businesses. Larger organisations, such as financial service providers, were more likely to use formal and consultancy findings than were smaller companies such as fashion retailers. In general, the better the economic climate the more experimental firms become in using new e-commerce technology.
  5. Originally it was thought that e-commerce was best developed by start up and stand alone businesses. With some notable exceptions, the most successful e-commerce has been undertaken within existing organisations. Cost absorption, market knowledge and the use of established brands have all contributed to this success.
  6. i. The internet has provided faster access and better knowledge of commodities and prices.
    ii. The ability to exchange information in both directions between producer and consumer has created a relationship not previously possible, and can result in modification of the product or service.
    iii. Information exchange and web chats for fan club members, hobbyists, collectors, etc. is enabled. It poses questions about the relationships between formerly ‘isolated’ individuals with shared, but sometimes competitive, interests.
    iv. Consumers appreciate being able to make fast transactions, search for unusual items, participate in auctions, and track markets.
    v. The screens on electronic devices have become a motif of cultural transmission, and a new way of monitoring activities. All organisations are now expected to have a website.
    vi. Speed has become the accepted ‘ambient’ pace.

The impact on the three sectors researched differed considerably:

  • fashion retailing relies to a large extent on touch and fit. E-commerce has had little impact beyond specialist items.
  • established financial service providers use e-commerce as an additional distribution network.
  • the music industry’s value chain has been completely destabilised by piracy, leading to a major restructuring.

About the study

The project was started in November 2001 and ended on 31 January 2004. It involved five researchers: Professor Andrew Leyshon (Principal Researcher), co-applicant Dr S French, and Professor L Crewe (all from the School of Geography, University of Nottingham), Dr P Webb (University of Birmingham) and Professor NT Thrift (University of Oxford).

Key words

E-commerce, producer/consumer relationship, internet transactions, information dissemination, dot.com boom