Through the service operations strategy looking glass: Influence of industrial sector, ownership, and service offerings on B2B e‐marketplace failures

Consistent with emerging e‐services literature, our empirical results indicate that B2B e‐marketplaces serving industrial sectors that are a better fit with the Internet service delivery systems–by high information dependence and low information tacitness–have the highest likelihood of success, as do e‐marketplaces with service offerings that facilitate collaboration among multiple buyers and sellers. We also demonstrate the positive influence of consortium ownership structure on B2B e‐marketplace survival, albeit not for first‐mover consortia‐backed e‐marketplaces. Our findings contribute to the service operations strategy literature and provide direction for managers in the areas of e‐service strategy and investment. This paper contributes to the emerging area of e‐service strategy in the context of business‐to‐business (B2B) e‐marketplaces, which we view as Internet‐based service delivery systems that link sellers’ offerings to buyers. Although a myriad of new B2B e‐marketplaces were launched over the past decade, a substantial number failed shortly after the peak of the NASDAQ in 2000. The bursting of the Internet bubble provides a setting for assessing salient, theory‐based determinants of failure–and success. Accordingly, we apply a service operations strategy lens and complementary organizational theories to explain how three strategic factors–industrial sector characteristics, ownership structure, and functionality of service offering–may have influenced B2B e‐marketplaces’ odds of survival after the bubble. We empirically test these factors using logistic regression analysis on a sample of 854 B2B e‐marketplaces.