International Market Entry Strategies: Relational, Digital, and Hybrid Approaches

Abstract

The adoption of digital communications, facilitated by Internet technology, has been among the most significant international business developments of the past 25 years. This article investigates the effect of these new technologies and the changing global business environment to understand how relational approaches to international market entry (IME) are changing in light of macro developments. Despite substantial resources in business practice dedicated to combining relational strategies in digital settings, this analysis of extant literature reveals that fewer than 3% of peer-reviewed research articles in the international marketing domain examine digital contexts. To address this gap, the authors assess 25 years of literature to provide (1) a description of the evolution of IME research; (2) a review and synthesis of pertinent literature that adopts relational, digital, and hybrid approaches to IME; (3) a taxonomy of IME strategies; and (4) directions for further research.

Revisiting Location in a Digital Age: How Can Lead Markets Accelerate the Internationalization of Mobile Apps?

“…Recent research also recognizes the importance of users. As we summarize in Web Appendix A, the emerging literature on digital internationalization not only explores supply-side factors such as firm resources (e.g., Cahen and Borini 2020; Mahnke and Venzin 2003) and strategies (e.g., Watson et al 2018; Wentrup 2016) but also highlights the role of users in facilitating digital internationalization (e.g., Chandra and Coviello 2010; Shaheer and Li 2020). What this research stream ignores, however, is the location-boundedness of user interactions; digital firms interacting with users in certain lead markets can be more likely to improve the global appeal of their technologies compared with firms first penetrating their technologies elsewhere.…”

Past, ongoing, and future debate on the interplay between internationalization and digitalization

“…In summary, innovations in digital technologies are completely reshaping the business environment and providing firms with new opportunities. Distinctive types of digital technologies, such as information and communication technology (ICT), the internet, e-commerce, social networking, the Internet of Things, data and analytics, robotic systems and additive manufacturing, allow firms to obtain competitive advantages (Lee and Falahat 2019); reduce transactional costs and information asymmetries (Yamin and Sinkovics 2006); improve productivity, integration, interaction and knowledge sharing inside and outside the organization (Alberti-Alhtaybat et al 2019;Andersson et al 2016;Coviello et al 2017;Zaheer and Manrakhan 2001); expand connectivity among firms, suppliers and clients, as well as the discovery and exploitation of new business opportunities, reducing physical distance and location dependencies (Jean et al 2010;Kim et al 2018;Özcan et al 2018;Sinkovics et al 2011Sinkovics et al , 2013Strange and Zucchella 2017); accelerate knowledge creation (Foss and Pedersen 2004); facilitate vertical disintegration and specialization (Alcácer et al 2016;Langlois 2002); allow for entry into new markets (Chen and Kamal 2016;Watson et al 2018); and generate new business models (Frank et al 2019), altering the physical boundaries (Chen and Kamal 2016) and tasks of firms and where the activities are located, shifting the frontiers of automation toward knowledge workers, and encouraging the emergence of a new "chapter" for firms (Charalabidis et al 2015). In this "chapter", special attention will be devoted to sustainability (Ghobakhloo 2019;Parida et al 2019) and the servitization of manufacturing (Luz Martín-Peña et al 2018).…”

“…Remarkably, analyzing the five literature reviews that focus on IDI, we acknowledge that all of them take insights from a specific stream of the literature and offer only a partial picture of the content and evolution of the knowledge of these two macro themes. More specifically, Watson et al (2018) explore the literature focused on how digital technologies shape international relationship-marketing strategies to provide a "description of the evolution of international market entry research" (p. 30). Vadana et al (2019) focus on the relationship between digitalization and international entrepreneurship and marketing to "provide a consistent picture of how value-chain digitalization affects companies' internationalization and international marketing" (p. 471) in born-global firms in high-tech industries, though digitalization is pervasive in other long-established industries as well.…”

“…During the last three decades (and especially the most recent one), great innovations in digitalization have reshaped the task environment and redesigned international strategies: innovative technologies have facilitated firms in reducing their transaction costs (Yamin and Sinkovics 2006), favoring communication, carrying out information interchanges and integration among partners, suppliers, customers and distributors (Alarcón-del-Amo et al 2018;Kim et al 2018;Özcan et al 2018;Vasilchenko and Morrish 2011), reducing distances (Liu et al 2016;Sinkovics et al 2011), supporting the emergence of synergies in production (Jean et al 2010), reshaping firm boundaries (Chen and Kamal 2016), and reconfiguring operations and the supply chain by reducing location dependencies (Jean et al 2010;Strange and Zucchella 2017). Moreover, digitalization has permitted the identification of new market opportunities (Chen and Kamal 2016;Watson et al 2018) and allowed for easy access to resources, capabilities and knowledge in foreign countries (Charalabidis et al 2015;Coviello et al 2017).…”

“…A first inspection of the available literature shows a lack of wide-ranging and analytical scrutiny of this interconnection; although we found five reviews that focus on digitalization and internationalization as intertwined phenomena, none of them provides an inclusive representation of the content and evolution of the knowledge on these two macro themes, as studied together. Moreover, these reviews focus on some specific aspects of digitalization (Eduardsen and Ivang 2016;Reuber and Fischer 2011) and internationalization (Vadana et al 2019;Watson et al 2018) or focus on a specific type of firm (Wittkop et al 2018) or country (Mendes 2020). All of them fall short in presenting the full picture of the literature on IDI, although more than 20 years have passed since attention began to be paid to this research domain (Lovelock and Yip 1996).…”