Growth of E-Commerce Continues Despite the Bursting

¶ … growth of e-commerce continues despite the bursting of the dot-com bubble. Since there are millions of websites (and growing) from which consumers can shop, individual sellers face diminishing odds of attracting visitors to their sites. To generate interest in their websites, sellers increasingly utilize sophisticated techniques to drive shoppers to their sites. Some techniques include frequent updates of website content, frequent changes in format, and inclusion of design complexity to keep visitors stimulated and coming back.

Design complexity refers to animated graphics, audio or video clips, Java applets, and other elements of interactivity. Interactivity, in general, is the amount and quality of two-way communication between two parties, but for their paper they go on to that it consists of a multidimensional construct that can be implemented in several ways such as through the availability of electronic feedback mechanisms, the ability to order products or services online, and/or the availability of searchable features, to name just a few.

However, keeping visitors coming back is not what makes them make purchases. The authors point out that even though many of the dot-com failures were attributed to poor website design and interface, there is strong evidence to suggest that good design and interface are far from guarantees of a website's commercial success. Those that succeed typically demonstrate good design and interactivity, but so do many of the failures.

In other words, poor design is often associated with failure and seldom with success, but good design alone can be associated either with failure or success. There are other factors influencing websites' success or failure, such as market turbulence and the website's age since inception. Summary The author undertakes a study in which various factors affecting commercial website performance are scrutinized: design sophistication and interactivity. He suggests that market turbulence and website age have a moderating effect on performance as influenced by design sophistication and interactivity.

Their research findings support this by showing that highly turbulent market conditions make interactivity an effective means of boosting performance while low turbulence in the market is not; in those conditions the market is largely indifferent to website interactivity. To some degree, interactivity and design sophistication seem to be independent, since the study showed that design sophistication was positively correlated with number of hits, and that number of hits had little if anything to do with performance; this effect was demonstrable under both turbulent and non-turbulent market conditions.

Critical Review According to the author's findings, interactivity explained only 8% of the observed variance in performance. In other words, when websites were commercially successful, 92% of their success had something to do with variables other than interactivity. This makes one wonder why anyone would lose sleep over the amount of interactivity on one's website.

In any event, correlation does not imply causation -- even though the level of significance achieved in the result is non-trivial, it can never be conclusively said that all of the observed 8% variance is actually attributable to website interactivity. The author does not do a very.