Entering the E-commerce Channel: What are the Established FMCGs waiting for ?
Independent thesis Advanced level (degree of Master (Two Years)), 20 credits / 30 HE creditsStudent thesis
This qualitative and explorative case study examines the main barriers that established fast moving consumer goods companies (FMCGs) will face when entering e-commerce. The barriers to entry are examined using three models: First Mover Advantage, Porter’s Five Forces Competitive Position Model, and two environmental factors. First, a general theoretical framework of barriers to entry is crafted and divided into micro and macro factors which are categorized in the operationalization based on the models. In this process, eight concepts were identified as related to barriers of entry: (1) phase of entry, (2) threat of new entrants, (3) rivalry in the market, (4) threat of substitutes, (5) bargaining power of buyers, (6) bargaining power of suppliers, (7) social-cultural factors in the market and (8) technological factors. By examining these factors, this study contributes to a deeper understanding of the main barriers to entry in e- commerce for established FMCGs.
The empirical study finds several barriers which the established FMCGs need to overcome in order to make a successful market entry. The profitability in e-commerce connected to groceries is a major issue for the established FMCGs because it is currently non-existent. The business structure within established FMCGs with physical stores and their mindsets are also identified as important factors regarding barriers to entry.
This study is built on rich data collected through semi-structured interviews with experienced CEOs in companies related to e-commerce and FMCGs. The primary data, in the form of interviews, together with complementary secondary data, triangulates the research question while creating a high level of validity.
Place, publisher, year, edition, pages
2016. , 61 p.
FMCG, e-commerce, barriers to entry, Five Forces of Competitive Position Model, market entry, sunk costs, environmental factors
IdentifiersURN: urn:nbn:se:uu:diva-297449OAI: oai:DiVA.org:uu-297449DiVA: diva2:941821
Subject / course
Master Programme in Business and Management