Operating in international markets through cross-border e-commerce: a practitioners' perspective

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Operating in international markets through cross-border e-commerce: a practitioners' perspective

Sh. Chen

As the global business environment continuously evolves, the cross-border e-commerce becomes an essential part of international markets. This research analyzes practitioners' perception of the cross-border e-commerce as an emerging channel to expand and operate in the global market and explores the platform structural performance determinants. We conducted the content and statistical analyses based on 35 interviews and constructed database of 150 observed companies. Deploying the springboard approach as the theoretical underpinning, we find the cross-border e-commerce optimal for companies to respond to the global turmoil in the short term and to achieve internationalization in the long term which serves as the most desirable option for firms to conduct cross-border commercial activities. The personalization in multiple language choices, reliable payment system settings, and clear website privacy commitment are the major factors. The diversity of language settings has the most significant positive influence on the cross-border e-commerce performance. This research contributes to the literature on the internationalization of firms and operation strategy in the global market enhancing the knowledge of operating crossborder e-commerce through the comparison with conventional internationalization paradigms and the examination of specific platform setting factors. International entrepreneurs can also benefit by understanding the practical specifications of the cross-border e-commerce and looking at platform structural performance determinants. The managerial implication suggested in this paper can be applied in their strategic decision-making which enhances a firm performance and helps to engage with the global economy.

Keywords: cross-border e-commerce, enterprises, practitioners, international markets, internationalization, platform performance determinants.

Трансграничная электронная коммерция на международном рынке: эмпирический подход

Ш. Чэнь

Поскольку глобальная деловая среда постоянно развивается, трансграничная электронная коммерция становится неотъемлемой частью международного рынка. В статье анализируется восприятие практиками трансграничной электронной коммерции как нового канала для расширения и работы на глобальном рынке, а также структурных факторов, определяющих производительность платформы. Исследование состоит из углубленных полуструктурированных интервью и опросов. На основе 35 интервью и построенной базы данных из 150 наблюдаемых компаний проведен статистический и контент-анализ. В качестве теоретической основы использован «подход трамплина». Трансграничную электронную коммерцию можно считать оптимальной для компаний в ответ на глобальные потрясения в краткосрочной перспективе и для достижения интернационализации в долгосрочной перспективе, а также наиболее желательным вариантом для ведения трансграничной коммерческой деятельности фирм. Персонализация при выборе многообразных языков, надежная настройка платежной системы и четкое соблюдение конфиденциальности веб-сайта являются основными факторами, в то время как разнообразие языковых настроек оказывает наиболее значительное положительное влияние на эффективность трансграничной электронной коммерции. Это исследование вносит вклад в литературу, касающуюся интернационализации фирм и стратегии работы на мировом рынке, расширяя знания об управлении трансграничной электронной коммерцией путем сравнения с традиционными парадигмами интернационализации и изучения конкретных факторов, определяющих платформу. Международные предприниматели также могут извлечь выгоду, понимая практические характеристики трансграничной электронной коммерции и обращая внимание на структурные факторы, определяющие производительность платформы. Управленческий подтекст, предложенный в статье, может быть применен при принятии стратегических решений, что способствует дальнейшему повышению эффективности деятельности фирм и взаимодействию с глобальной экономикой.

Ключевые слова: трансграничная электронная коммерция, предприятия, практики, международные рынки, интернационализация, факторы производительности платформы.

Introduction

Over the past years, traditional global trade has shown inevitable growth fatigue [Altuzarra Bustillo, Rodriguez, 2022]. Behind this phenomenon are many reasons, including rising trade protectionism [Branicki, Sullivan-Taylor, Brammer, 2021], nationalism [Albertoni, Wise, 2021], and unilateralism [Petricevic, Teece, 2019; Nambisan, Luo, 2021]. These all lead to a remarkable decrease in cross-border demands and supplies for products and services. Nevertheless, the Black Swan in 2020 made the international markets even worse. During the COVID-19 crisis, governments took strict measures to control the pandemic, which inevitably brought severe problems to international mar© St. Petersburg State University, 2022 kets. In contrast to the weak growth of traditional offline import and export trade, crossborder e-commerce (CBEC) plays an increasingly significant role in global markets. The CBEC B2C sales increase from 440 billion US dollars in 2019 Estimates of global e-commerce 2019 and preliminary assessment of COVID-19 impact on online retail 2020. 2021. UNCTAD Technical Notes on ICT for Development (18). UNCTAD. URL: https://unctad. org/press-material/global-e-commerce-jumps-267-trillion-covid-19-boosts-online-retail-sales (accessed: 10.06.2022). to 764.73 billion US dollars in 2021 Cross-border B2C e-commerce market share, size, trends, industry analysis report, by category, by payment method (digital wallets, credit/debit cards, Internet banking, others), by offering, by end-user (Adults, Teenagers/Millennial, Senior Citizens, Others); By Region; Segment Forecast, 2022-2030. 2022. Polaris Market Research. URL: https://www.polarismarketresearch.com/industry-analysis/cross-border- b2c-e-commerce-market (accessed: 10.06.2022)., an increase of 73.8% comparing to the 17% increase in total international trade over the same period The UNCTADSTAT database. 2022. UNCTAD. URL: https://unctadstat.unctad.org (accessed: 10.06.2022).. The share of CBEC in international trade has grown by 48%. The CBEC raised more speedily than offline trade and became a new driver of international trade [Tu, Shangguan, 2018]. With the rapid growth of global internet access and information technology adoption, global e-commerce participants increase every year [Wang et al., 2020].

In today's volatile and digital-first environment, platform-based business activities dominate the markets [Baek, Lee, Choo, 2019]. The Internet enables consumers to purchase products and services online from merchants located in other countries [Yousefi, 2015]. Such international e-commercial activities are called CBEC. It emerges as a brand-new approach for companies to achieve internationalization and operate the cross-border business [Tolstoy et al., 2021]. This form of trading is gaining popularity in global markets thanks to the predominant online shopping behavior and the rapid rise of information technology [Goutam, Gopalakrishna, Ganguli, 2021]. Considering the dynamic global business environment, the CBEC is becoming the leading power in international markets, requiring up-to-date and insightful investigation.

Scholars suggest that the CBEC has irreplaceable significance for enterprises to operate in international markets [Tu, Shangguan, 2018]. Most challenges companies encounter when operating in international markets, such as the liabilities of foreignness (LOF) [Cao, Alon, 2021] and legitimacy building [Ike et al., 2021], can be appropriately addressed via the CBEC. Whereas these studies mainly portray the role of CBEC as the complementary to conventional import and export trade, a tool for entrepreneurs to facilitate market strategies [Mathews et al., 2016].

Only a few works note that the CBEC is a direct channel for companies to internationalize [Qi et al., 2020; Cassia, Magno, 2021]. It is therefore necessary to treat the CBEC as an independent approach for market expansion and internationalization and specify its advantages through comparation with extant international business paradigms. Besides, there is a limited understanding of the particular functions achieved through CBEC [Qi et al., 2020]. Specifically, most studies on this topic remain theoretical. They provide inductive insights from a broad perspective and lack practical evidence based on business owners' experience, supporting the CBEC's unique nature and enriching the phenomenon's understanding. The fact that can be criticized is some suggested CBEC features that are theoretically achievable could be unfeasible in practice. Researchers have not paid sufficient attention to explore the CBEC's operation in international markets based on sufficient practical evidence. This research attempts to draw the empirical picture through an in-depth exploration.

Moreover, the practical-knowledge gap remains with the CBEC operational determinants in the continually changing international environment. Recent studies focusing on CBEC performance determinants primarily involve elements that are concerning firms' own overall characteristics, such as the international marketing and cross-border operation capabilities [Cassia, Magno, 2021], legitimacy obtaining [Kwak, Zhang, Yu, 2019], and cultural identity management [Hallikainen, Laukkanen, 2018]. Others investigate the influence of macroeconomic factors, such as the national GDP and the exchange rate [He, Wang, 2019].

These factors are not directly related to the platform settings and are not under the control of the business owners. Therefore, the managerial implication of such studies is relatively limited. Only a few studies have measured the influence of CBEC platform structure-related factors but undertaken in the newly stage of CBEC's emergency, considering the platform settings as language choices and payment systems [Gomez- Herrera, Martens, Turlea, 2014; Turban et al., 2018]. The impacts of CBEC performance determinants could change along with the dynamics of the global markets [Yu, Huo, Zhang, 2021]. This is especially true when considering the complicated impacts of the COVID-19 pandemic and the accelerating digitalization trend [Sulkowski, 2020]. When businesses reach the global market through CBEC today, the factors affecting their performance could change dramatically. And the most effective method to address these gaps is directly through the practitioners. Therefore, it is essential to highlight the market dynamics and explore the influence of platform structure-related factors through the lens of practitioners.

Knowing these gaps, this study aims to exploring the perception of business practitioners in terms of implementing CBEC during the engagement with internationalization and detecting the influence of typical structure-related elements on the CBEC performance. Two research questions have been identified: How do practitioners view the CBEC as an emerging channel to operate in international markets? And what are the platform structural factors affecting CBEC performance? To understand the essential position of CBEC in international markets, a qualitative content analysis was firstly conducted based on practitioners' experience. Following, we combined the feedback from semi-structured interviews with the literature review, located the CBEC website structural factors and formulated hypotheses. Finally, the connection between CBEC performance and specific platform structural factors has been identified through a statistical analysis.

While prior research concerning the business operation in international markets has not paid comprehensive attention to the CBEC channel and practitioners who are implementing it, this study provides more profound knowledge about CBEC's characteristics and its structural performance determinants. This can contribute to international business, international entrepreneurship, and marketing literature, broadening the knowledge through an interdisciplinary approach. Besides, according to research outcomes, actionable suggestions have been provided for practitioners to further carry out CBEC activities and those companies considering internationalizing and conducting cross-border business.

The rest of this paper is structured as follows. The second section systematically analyzes the extant literature on CBEC in international market and its performance determinants, certain hypotheses are formulated. The third section describes the research methodology. The qualitative and statistical analysis results are provided in the fourth section. The fifth section is the research conclusion and contribution. The research limitation and suggestion for future research are also presented in this section.

LITERATURE REVIEW

With e-commerce has been applied in international markets, scholars treat this emerging platform as the future of global trade [Tu, Shangguan, 2018]. Recent studies focus on economic recovery after the coronavirus will expire; many of them mention the potentially crucial position of CBEC in the global market and propose that the CBEC could be the most efficient method for companies to maintain their cross-border business activities [Qi et al., 2020].

Overview of CBEC. The CBEC refers to the internet-based activities of selling products or services across geopolitical borders from a company's country of origin into non-native markets [Elia, Giuffrida, Piscitello, 2019]. As an essential matter of academics, there is a body of studies focusing on CBEC for its unique significance. Earlier, researchers have already suggested that the CBEC, a digital format of cross-border trade in the information age, can be distinguished from traditional physical international trade in imports and exports [Malhotra, Agarwal, Ulgado, 2003]. Considering the technology advancement achieved in recent years, such as the evolving logistic service and information technology, the seamless connections between physical and virtual parts of the e-commerce activities, it is acknowledged that the electronic means dominate international markets in the brand-new era [Kwak, Zhang, Yu, 2019]. Digitalization benefits have updated the exchange between buyers and sellers [Sleuwaegen, Smith, 2020].

Researchers continually investigate the significance of CBEC for economic development. Through comparing two groups of countries N. Terzi [Terzi, 2011] specifies that the CBEC offers universal benefits to all unities: profits are likely to be distributed in developed countries in the short term, but more profits would be shifted to developing countries in the long run. A regression analysis based on 21 selected countries demonstrates that the implication of CBEC has a significantly positive influence on national GDP growth [Anvari, Norouzi, 2016]. Plenty of research also reports that the CBEC is vastly essential to the country's well-being, creating jobs and generating revenues [Terzi, 2011]. A representative case grounded in emerging markets emphasizes the preferential effects of applying the CBEC to alleviate poverty and improve the livelihoods of people in Russia [Haji, 2021]. The governments have embraced both domestic and international e-commerce as a vital part of economic growth drivers [Kituyi, 2020]. For instance, the Chinese government has introduced numerous preferential policies to support CBEC growth [Wang, Wang, Lee, 2017]. The proposal of building the “Digital silk road” and the establishment of 109 CBEC pilot zones significantly foster China's CBEC development [Zhang, 2020; Li, 2021]. The governments have evolved from passive regulators to proactive advocates of CBEC [Tu, Shangguan, 2018].

The CBEC in international markets and the springboard approach. International business communities consider the CBEC an effective channel to promote multinational business and integrate into the global economic system [Jean et al., 2021]. Case in point, the rapid development of CBEC in Russia and China has boosted their commercial activities in international market [Wang, Zhang, Sun, 2017]. Y. Wang, Y. Wang, and S. Lee [Wang, Wang, Lee, 2017] report that the growing CBEC positively influences total global trade volume. Meanwhile, L. Yao and Z. Yan [Yao, Yan, 2019] suggest that the traditional import and export trade is also closely related to the CBEC, but such relationships are pretty complex [Goldman et al., 2021].

From the micro-perspective of companies, literature elucidates the relationship between firms' e-commerce application and performance promotion. Researchers find that the implementation of the e-commerce leads to better firm performance, demonstrated in efficiency improvement [Jean et al., 2021], the growth of sales value and market share [Kraemer, Gibbs, Dedrick, 2005], etc. In addition, the exponential development of CBEC also encourages the creation of employment [Terzi, 2011] and the advancement of supply chain systems [Yu et al., 2016]. Regarding the companies' international expansion, the CBEC directly connects enterprises with foreign consumers, bypassing most intermediates, which is an efficient driver to expand to overseas markets [Yin, Choi, 2021]. Noteworthy, the CBEC is not approachable only to large-size companies. It is also accessible for small- and middle-size enterprises (SMEs) to operate in international markets [Cassia, Magno, 2021]. Particularly, Russian manufacturers and retailers benefit by mitigating marketing costs, stimulating product development, and further achieving internationalization [Sosnovskikh, 2021]. Without the excellent competitive advantages that leading multinational enterprises have, firms of any size can participate in the game and introduce their products in overseas markets [Elia, Giuffrida, Piscitello, 2019].

Practitioners can also address the challenges during internationalization by applying CBEC. For instance, the liabilities of foreignness can impose additional costs due to the unfamiliarity in local regulations or cultural background and customer brand loyalty [Cao, Alon, 2021]. While enterprises entering host markets through CBEC can reduce imposed costs. The host market knowledge can be easily accessible if the company decides to sell products via local third-party platforms [Kwak, Zhang, Yu, 2019]. Regarding the associated transaction costs, firms could also lower their investment in physical assets, warehousing, customer service, and employee training. Local marketplace platforms can provide these fundamental elements [Qi et al., 2020]. Another essential task enterprises must consider is obtaining legitimacy [Ike et al., 2021], which is critical for e-commerce growth, especially in non-native markets. As J. Kwak, Y. Zhang and J. Yu [Kwak, Zhang, Yu, 2019] suggest, firms can obtain legitimacy when the local market perceives them as trustworthy. While the CBEC can be significantly useful to enhance the companies' reputation. The marketplace platforms usually are responsible for providing assistant to build trust and reduce uncertainties [Qi et al., 2020].

Given the specialties of CBEC, researchers suggest that firms could apply the online platforms as the springboard to achieve international expansion. Y. Luo and R. Tung define the international springboard as firms' global strategy to pursue opportunities and strategic assets, take advantage of favorable foreign institutions, and further strengthen their global competitiveness. [Luo, Tung, 2018]. The springboard approach has been widely referred to in recent articles examining internationalization, while few papers have used it to portray the CBEC development. To promote the Chinese traditional medicine cultural industry, L. Xie and G. Chen argue that firms can expand globally using the CBEC as a springboard since the Chinese government strongly supports both industries [Xie, Chen, 2021]. H. Kim and H. Lee also report that firms should improve their information and marketing capabilities and apply the CBEC springboard to moderate performance [Kim, Lee, 2016]. Therefore, the springboard approach is promising to explore practitioners' experience applying the CBEC in international markets.

Despite the literature elucidating the CBEC's significance, extant investigations have not presented sufficient practical knowledge about the CBEC operation. More specifically, how entrepreneurs perceive the CBEC in their international commercial practice has not been clarified yet. The same is true for studies of the factors affecting the efficiency of CBEC in the dynamic global environment. The following subsection reviews the prior literature identifying the CBEC performance determinants.

The determinants of CBEC performance. Numerous studies have explored the performance determinants of CBEC. One of the most vital factors is the company's ability to apply information technology, which facilitates upstream and downstream integration and improves operational performance [Yu, Huo, Zhang, 2021]. Meanwhile, logistics service quality also plays an essential role in CBEC's success [Niu et al., 2019; Sun, Gu, 2021]. S.-L. Huang and Y.-C. Chang emphasized that CBEC firms' most crucial operation driver is creating value and trustworthiness in overseas markets [Huang, Chang, 2019]. Based on the experience of Alibaba, J. Kwak, Y. Zhang, and J. Yu highlight the importance of legitimacy building for CBEC's market acceptance [Kwak, Zhang, Yu, 2019]. Companies could promote their sales by developing “E-trust” in host markets [Fernandez-Bonilla, Gijon, De la Vega, 2022]. The emergency of CBEC creates massive learning potential for its performance determinants, whilst most of the literature focuses on companies' own overall capabilities, and less attention has been left to the CBEC website structures.

To directly contribute to broadening the CBEC knowledge and the managerial domain, among plenty of determinant's investigations, our interest revolves around the setting of companies' purchasing platforms, as these factors are directly controlled by the practitioner and influence consumer shopping behavior [Zhu, Mou, Benyoucef, 2019].

In the cross-border commercial context, a well-accepted return policy can increase consumer confidence in the quality of products and, therefore, their willingness to purchase [Shao et al., 2021].

The digital platforms' technological quality and diversity also influence consumers' utilization of the CBEC. Consequently, retailers can promote purchasing intention by differentiating the platform's settings and providing more alternatives to the customer journey [Wagner, Schramm-Klein, Steinmann, 2020]. Entrepreneurs are required to invest in the platform to build relationships with customers [Chen, Yang, 2021] and provide personalized purchasing experiences that resemble offline retail to meet consumers' preferences [Cui et al., 2020]. Such preferential website settings involve minor information asymmetry and more possible payment choices for the consumers [Zhang, Chen, Zuo, 2020]. Hence, language and payment settings become explicit biases for consumers because they look for the possibility of making purchases in native languages and country's own currency [Huang et al., 2021]. Early, E. Gomez-Herrera, B. Martens, and G. Turlea report that efficient platform usage and payment system diversity could increase CBEC performance [Gomez-Herrera, Martens, Turlea, 2014]. Further, E. Turban with co-authors augment that the CBEC platform should offer multiple choices regarding languages, currencies, and payment methods to satisfy diverse international consumers [Turban et al., 2018].

Multiple language choices ensure that consumers in different countries purchase online efficiently [Huang, Chang, 2019]. Avoidance of the language barriers opens the retailer to different markets; the language selection is the option that puts the choice in the consumer's hands and personalizes the online shopping experience, making the digital platform close to the domestic offline commerce [Nambisan, Luo, 2021]. Therefore, the number of accessible languages can represent the personalization of CBEC platforms, which can be increased thanks to the rapid development of information technology [Han, Kim, 2019]. Given that the number of consumers with a command of multiple languages has been growing and the web translation technology has also been greatly improved, it remains unclear whether the languages available on the CBEC platform still significantly influence consumers' purchasing intention. In this context, the following hypothesis is formulated:

Hypothesis H1. The personalization of language settings has a positive influence on the cross-border e-commerce performance.

Consumers prefer to pay safely and efficiently with their country's currency and through reliable local payment systems [Ding, 2018]. It requires particular CBEC infrastructures, including inclusive and cost-efficient online payment systems, considering that cross-border transfers are usually subject to a certain amount of commission [Gomez-Herrera, Martens, Turlea, 2014]. Therefore, the efficiency of online payment systems is another essential factor that motivates consumers' shopping intention and influences the CBEC platform's performance. One way to improve the payment efficiency is to diversify the payment structure and affiliate with suitable payment processors [Tu, Shangguan, 2018]. Therefore, the flexibility of payment structure represented by the number of options for paying can positively affect platforms' performance [Turban et al., 2018]. Whereas many mainstream payment processors have achieved global penetration over the past years, such as Mastercard, Visa, and China UnionPay [CrossBorder E-Commerce..., 2019]. It is therefore important to test if the number of payment options available to a website remained positively correlated with its performance. To draw a hypothesis:

Hypothesis H2. The diversity of payment structure has a positive influence on the cross-border e-commerce performance.

Trust on the Internet is demonstrated to be positively relevant for operating crossborder e-business, especially in the context of high demand for trust [Valarezo et al., 2018; Cui et al., 2020]. Based on European Union (EU) digital markets, A. Rosner, J. Hau- cap, and U. Heimeshoff indicate that the customers' trust and purchasing intention in CBEC are positively subject to privacy protection [Rosner, Haucap, Heimeshoff, 2020]. It can be a tough challenge to CBEC enterprises because of the different enforcement in each part of the world and the continuous change in the laws on privacy protection [Ld, 2005]. The possibility of being frauded is rising due to the increasing sophistication of fraud techniques, which is a severe threat for the consumer and sets specific boundaries to the operation of CBEC [Guo et al., 2018]. In the CBEC platform management, privacy and consumer protection must be enforced rigorously [Xiao, Zhang, 2020]. Thus, the following hypothesis is provided:

Hypothesis H3. The platform's privacy protection commitment has a positive influence on the cross-border e-commerce performance.

To summarize, prior studies mainly consider companies' own managerial capabilities and undertaken in the emerging stage of the CBEC. In the quantitative part of the given research, specific CBEC platform's structural factors have been considered, including personalized retailing experience in terms of language preference, well-defined payment structure, and explicit statements about privacy, and highlight the global environmental dynamics, examining whether these factors remain significant. The need is now to investigate the efficiency of these retailing platforms, with already these features considered: the growth in online purchasing and the evolving global environment in the COVID-19 and digital era.

METHODOLOGY

Research design. The main interests of the present study are to explore practitioners' opinions about adopting the CBEC to internationalize and test the platform structural factors in the dynamic market context. The identified research questions have been addressed through a mixed methodology. The qualitative approach included interviews with entrepreneurs with the aim of understanding their perceptions of CBEC's practice in international markets and their preference for platform settings. Subsequently, the quantitative part involved a confirmatory regression analysis to test the formulated hypotheses and clarify the relationships between the platform performance and specific structural factors.

As previously mentioned, most extant literature on CBEC characteristics is descriptive and stays in the theoretical stage. Hence, this study attempted to explore the CBEC operation more profoundly based on practical specification through gathering and analyzing entrepreneurs' perceptions from semi-structured interviews. The qualitative method is widely applied in similar research, which is useful when researchers pursue comprehensive and in-depth insights about the phenomenon in its natural context [Gehman et al., 2018]. Interpretivism thus was our philosophical underpinning for the qualitative part.

Further, the gap to close is to examine whether the same platform structural factors that were influential to CBEC before are remaining effects nowadays. Our interest was to detect if these factors still significantly affect the CBEC performance and whether certain noteworthy changes exist. Intending to understand the website structures on which companies can invest in promoting their CBEC performance, a critical revision of its determinants was firstly implemented through a systematic literature review. After retrieving the appeared structural factors from extant research, the proportions of their appearance in the literature have been calculated. Key studies that investigated the website setting factors are listed in Table 1 below. Furthermore, the main determinants have been screened and confirmed by semi-structured interviews with business owners. Finally, the platform structural factors that most frequently appeared in prior literature and were accepted by practitioners include: platform personalization regarding languages choices (with an appearance rate of 9% in 79 selected papers), diversified and efficient payment systems (8%), and explicit statements about privacy protection (5%).

Table 1. Key papers involved platform structural factors

The corresponding hypotheses have been built in the previous literature review section and these factors are treated as the independent variables for further quantitative analysis (Table 2).

Table 2. Variables and definition

Needed to investigate the influential role of each factor, a quantitative multiple regression has been chosen given its reliability for these types of research [Sreejesh, Mo- hapatra, Anusree, 2014a; 2014b]. The regression analysis has been conducted for the advantage of representing the relationships between each independent variable, namely language personalization, payment system, and privacy commitment; and the dependent variable, identified as the CBEC performance.

To represent the dependent variable CBEC performance, the number of clicks done in a certain period was firstly considered. In other words, how many times have consumers accessed a particular company's website either to have a look or eventually to buy its products. Based on the evidence, counting the clicks is not representative because many consumers may enter the website without buying any product. Hence, the volume of sales has been chosen and, the main options were whether considering it as the sum of money earned from sales in a determined period, whether considering it as the number of sales done in a determined period. Eventually, CBEC performance was measured as the total online overseas revenues in millions of dollars in 2020.

Data collection and analysis. The required data have been collected mainly through purposive semi-structured interviews and surveys. The B2C CBEC firms from the fashion goods industry were considered as our research sample. Companies whose advertisements frequently appear on social media were specifically targeted. The data collection process consisted of two steps. The first one was to gather qualitative data through in-depth semi-structured interviews. The provisional plan, which included 50 interviews with firms' managers, was reduced due to the pandemic. The interview process was stopped when responses from informants became recurring and the material collected gave us potentials to approach desired level of theoretical saturation [Saunders, Townsend, 2016]. Overall, the sample size for the interviews included 35 entrepreneurs worldwide (12 Russian, 15 Chinese, and 8 European practitioners), to whom a variety of questions concerning the ownership of a CBEC platform was asked. Most of the interviews were conducted online in English via video conference (45 to 60 minutes long).

The interviews have been conducted for both qualitative and quantitative analysis. In the first step of qualitative analysis, these interviews aimed to detect entrepreneurs' perceptions and experiences about operating the CBEC in international markets, particularly compared with conventional internationalization patterns, such as the Uppsala model [Forsgren, Hagstrom, 2007] and the network approach [Ratajczak-Mrozek, 2012]. In addition, during the interviews, the entrepreneurs' intention regarding specific settings of online platforms was specifically concerned, such as the multiple language settings, diversity of payment methods, and privacy commitment. Informants' feedback was essential to verify the knowledge retrieved from the literature review and locate the critical platform setting factors for the second step of analysis. A content analysis has been subsequently performed based on collected interview transcripts (quoted in the following section as “informant + number”), in order to identify and synthesize opinions about CBEC's operation in international markets and specific platform structural factors.

In the second step of quantitative analysis, after the objective factors were settled, data of these factors have been collected through direct surveys and a dataset has been constructed for further quantitative analysis. Including the companies from which practitioners for interview had been approached, the sample size was further expanded for quantitative analysis through extensive Google search. The control variables are the size of the company (number of employees between 100 and 300), and its experience in implementing the CBEC (the company has been in the CBEC industry for between 5 and 10 years).

In doing so, it has been ensured that the performance of sample companies is mainly influenced by the independent variables involved. Finally, the sample comprised 150 observations distributed: 45.33% (68) -- Chinese; 14.67% (22) -- Russian; 30% (45) -- European, and 10% (15) -- USA enterprises. Most of the observations are taken from the Chinese market since China is the world's largest e-commerce market with over 200 million online consumers [Fan, 2019; Xiao, Zhang, 2020]. And a commentary from the Ecommerce News says that Europe follows the trend: 23.55% of total e-commerce in Europe in 2019 was carried out in CBEC platforms Ecommerce News. 2020, June 4. 24% of ecommerce in Europe is cross-border. Ecommerce News. URL: https://ecommercenews.eu/24-of-ecommerce-in-europe-is-cross-border/ (accessed: 03.07.2021).. Such a dataset composition allows us to cover all the major markets oriented to CBEC in the current situation. The platforms of sample CBEC companies have been browsed for directly collecting the necessary data from their websites. The number of languages options, the diversity of payment systems, and the existence of privacy enforcement, all the required data about objective independent variables have been individually extracted from each enterprise's websites. And the data sources of dependent variable (total online overseas revenues in millions of dollars in 2020) include companies' balance sheets and press releases, published industrial reports, and authoritative databases such as the MarketLine, Refinitiv DataStream, and Wind-Economic Database.

Empirical analysis

Qualitative findings and discussion. Overall, this study highlights a positive response about taking advantage of CBEC to establish direct communication with overseas consumers and process internationalization. To date, few studies have criticized the consequences of implementing the CBEC. Academics and practitioners recognize the increasingly essential role that CBEC plays in the international market due to the turbulence of globalization and the rapid wave of business digitalization [Tolstoy et al., 2021]. This tendency can still be noticed from the phenomenon that the CBEC is becoming the favorite choice for businesses to penetrate foreign markets and achieve internationalization [Qi et al., 2020]. To provide sufficient empirical evidence necessitating the CBEC, the following text reports the entrepreneurs' perceptions on CBEC in the light of internationalizing. commerce global market

Internationalization is always described as a complex process with long duration and multi-stage characteristics that deserves extensive scholarly attention. Specific models have been built to systematize such an intricate business process [Panibratov, 2017]. Among them, the Uppsala model [Forsgren, Hagstrom, 2007] and the network approach [Ratajczak-Mrozek, 2012] are the most established theoretical models portraying the process of a company's internationalization. The dynamic patterns elucidated by these two frameworks make vital contributions to the scholarly advancement of international business. These two basic models are specifically listed not only because of their theoretical dominance in explaining firms' overseas expansion, but also because of the long history and widespread appearance of the phenomena pictured by these frameworks. Acknowledged by practitioners, these two models have long been guiding companies' foreign expansion, playing an integral role in their strategic decisions. Compared with these two conventional internationalization paradigms, our informants have drawn a distinctive picture regarding the CBEC as an internet-based expansion approach.

The Uppsala model depicts the phenomenon that firms initially enter geographically close foreign markets, followed by expansion into distant overseas markets relying on the practical knowledge gained from previous experience, portraying a “learning-bydoing” process [Forsgren, 2002]. This is a gradual independent path of internationalization based on experience acquiring but requires enormous resources and entails high transaction costs. In certain conditions, firms still fall into the dilemma of market access restrictions and lacking local knowledge.

Instead, CBEC offers entrepreneurs a shortcut to learning and expanding. In contrast to the traditional model's sophisticated process and institutional barriers, the CBEC provides a much shorter transaction flow and lower threshold for markets entering. It emerges as a plausible choice due to its efficiency in reducing transaction costs [Qi et al., 2020]. Various services accessed from local marketplace platforms and technology providers enable firms to enter markets smoothly, receive adequate host knowledge and diversify marketing strategies, along with reasonable transaction costs. The company does not need any entity in the target host markets. The transaction is conducted on the company's website or third-party market platforms through the Internet. Thinking about setting up a stand-alone website with a shop function can ensure a high level of independence and flexibility. In parallel, existing local platforms allow companies to sell products without obtaining particular local experience and market knowledge. As the interviewees have emphasized:

“When entering a foreign market, the first step is to address issues related to market access. CBEC has a huge advantage in this regard. We can quickly process the business licence with the help of local third-party platforms and our products can pass the quality inspection process more conveniently” (Informant 11).

“Pre-market research is still necessary, but if we choose the CBEC, necessary information can be easily obtained without spending a lot of money and time. We can quickly and effectively access local knowledge, understand markets information and consumer trends, describe our products in a way that better matches the language and preferences of local consumers” (Informant 2).

Another commonly adopted internationalization strategy is establishing a host network of relationships with local entities instead of independently operating in foreign markets [Tomaszuk, 2017]. Formulating connections can secure assistance for multinational activities from various local organizations regarding the accessibility of information, resources, and institutional supports [Johanson, Mattsson, 2015]. The internationalization strategy is recommended to depend on the firms' peculiarities, available resources, and ability to integrate with other business communities [Dragun et al., 2020]. Whether horizontal or vertical cooperation, the network approach can always lead to increased productivity, lower average costs, and economies of scale. Although building ecosystems can facilitate the creation of business communities and group members' support, it inevitably leads to divergent interests and disputes. The over-communication among firms also leads to time consumption and resources waste, increasing unnecessary transaction costs. In this context, CBEC offers a relatively neutral model of cooperation. Companies and local third-party platforms or technology providers work together selectively within appropriate parameters. This partnership model is focused on firms' interests and allows them to choose the cooperation patterns and areas according to their needs, without being overly dependent on other companies and being forced to make concessions on specific deals. As the informant has suggested:

“Entering the market through partnerships with local entities is effective, but it is challenging to achieve satisfactory results. CBEC offers a partnership model with a low level of integration. We rarely have a conflict of interest with local third-party platforms, they give us a variety of options, and we make the settings that maximise our interests based on our own circumstances” (Informant 18).

Furthermore, considering the autonomy issue, companies internationalizing through the Uppsala model or the network approach are in an entirely distinctive situation. The Uppsala model offers companies complete autonomy and spaces for rational decision-making since it is their independent path [Dragun et al., 2020]. In contrast, the network approach seeks cross-border cooperation and lacks autonomy and independence. In most cases, companies within the network need to negotiate to reach a decision in all members' interests. Enormous difficulties and compromises of cooperators usually accompany such a process. Firms based on CBEC platforms can have more flexible solutions comparing with these two models. It is unnecessary to control the transaction process entirely or rely on others heavily. The CBEC allows companies to decide which operations to manage themselves or outsource to others according to their strategic needs. Our respondents have claimed:

“It depends on the situation. We may wish to exercise greater control over the use of digital assets in certain application areas and relinquish autonomy in other areas where we are incapable. The CBEC left the choice in our own hands” (Informant 5).

“The CBEC is a way to gain the convenience of collaborating with other companies without sacrificing our autonomy” (Informant 21).

Noteworthy, the interviewees found the metaphor of a springboard very graphic. The turbulent global business environment can be seen as a severe challenge also a unique strategic opportunity for entrepreneurs. CBEC is a springboard for entrepreneurs to seize this opportunity. With the rapid development of digital information technology, entrepreneurs can enhance firm's reputation and competitiveness in global markets [Katsonis et al., 2019]. While supporting a steady stream of business activity, it is also possible to further expand the foreign markets and internationalize. Traditional import and export trade is progressing slowly, the CBEC as a springboard has evident advantages for firms to leapfrog the limited domestic market and fierce competition, and sustain a stable international presence [Hanell et al., 2019]. Table 3 presents the comparation between the CBEC springboard with prior paradigms of the Uppsala model and the network approach.

Table 3. Comparison of CBEC with typical internationalization paradigms

As an emerging pattern of international trade following the rise of e-commerce, CBEC's superiority also ensures it replaces parts of traditional import and export trade within a short period. However, the features as stability and transparency of traditional import and export trade are hard to achieve by online format at the moment [Yao, Yan, 2019]. Therefore, the CBEC and traditional import and export trade will develop in a complementary manner in the long term. Given the long history and well-established process of traditional international trade, the CBEC has drawbacks as it lacks practice. While national governments considerably well regulate the former, the CBEC is yet in the development process, and fewer explicit policies are put in place to govern the sustainable development of CBEC. It brings practical problems that are urgently to be solved, including incomplete customer service, returns policy, and payment procedure.

Although the CBEC enables the flexibility to deal with the business environment dynamics, it is subject to technological updates [Ding, 2018], which requires a high level of asset specificity integration to face technological uncertainty. The interviewees have expressed their concern that the firms' total cost may not really reduced, but only the transaction costs of the offline activities were transferred to the inputs in the online platform, such as the registration fees for the third-party platform, the expenditure on additional service from third-party platforms, the cost for e-store design, the fees tied to the payment systems, and costs imposed due to technological updates. In this case, further investigations are needed to explore whether the CBEC effectively reduces business transaction costs.

Moreover, other barriers to the CBEC development apart from those exhibited in Table 3 also need to be taken into account. For instance, the institutional regulations and technology access could be significant obstacles for practitioners to operate CBEC in international markets. The Chinese government's “Great Firewall” and the Russian market under sanctions as two great examples. The Chinese government's “Great Firewall” makes websites of foreign brands inaccessible, which has caused difficult barriers for foreign companies to enter the Chinese market through independent websites and mainstream social media. Meanwhile, companies from Russia have been restricted in terms of Internet connectivity and technology accessibility due to imposed sanctions. Russian firms intending to expand in foreign markets continue to face the dilemma of disconnections or complete lack of connectivity to their websites, which makes it difficult for them to advance overseas expansion plans. The informants have explained: