Impact Of Network Externality And Involvement On Loyalty Formation Of Electronic Commerce

As E-commerce enters its 20th year, it has now reached a stage of maturity and steady. The significant mark is that the e-commerce market presents the structure of oligopoly monopolization and fierce rivalry occurs among several leading websites. Besides, there is a trend that these websites have high degree of homogeneity in design and function. In this case, how to increase user’s usage and make the website users transform loyal users, are initial problems that e-commerce enterprises need to resolve urgently for the sustainable development.Considering the basic features of e-commerce websites and through the application of theory and empirical analysis, the study first reviews prior research on user loyalty, network externality and involvement, and summarizes the driving factors of user loyalty, especially focusing on the influence network externality and involvement on user loyalty, and then builds the structure model and measurement model. Second, we designed the questionnaire for the Made-in-China and Suningyi purchase website buyers on the base of the previous study. Besides, we entrust the user department of Made-in-China and Suningyi purchase conduct the questionnaire survey, and receive 710 usable respondents of Made-in-China and 311 usable respondents of Suningyi purchase. And finally by using the SPSS 17.0 and AMOS7.0 software, the survey results are statistical tested, and three user loyalty models are conducted. And to make suggestions for e-commerce managers, this paper takes a deep analysis of the user loyalty formulation on B2B and B2C e-commerce from the points of network externality and involvement.Through the empirical study, we can get the conclusions as follow:1) For B2B and B2C e-commerce, network externality has a positive effect on user loyalty by influencing perceived value. Direct network externality significantly influences indirect network externality.2) Switching cost and user satisfaction have different impact on user loyalty between B2B and B2C e-commerce. Switching cost and user satisfaction affect user loyalty positively on B2B e-commerce websites, while, switching cost and user satisfaction are not predictors of user loyalty on B2C e-commerce websites.3) There is significant difference on loyalty formation mechanism between B2B and B2C e-commerce. Involvement will affect the relationships among switching cost, user satisfaction and user loyalty.From the perspective of network externality, this paper explores the process how user loyalty is formed on ecommerce websites and focuses on the differences and similarities of buyer loyalty formulation between B2B and B2C e-commerce. Drawing lessons from the theory and achievement of psychology, economics, marketing management, customer behavior and statistics, this study introduces "network externality" of the economic theory and "involvement", the psychological concept, to the field of marketing management and customer behavior. That provides a fresh perspective for the researches on loyalty and enriches the theoretical research on user satisfaction and loyalty under the background of e-commerce. The innovation:first, we investige user loyalty of e-commerce websites from the view of network externality; second, we discuss the differences of user loyalty formulation on B2B and B2C websites from the perspective of involvement; third,.the research objects include B2B websites, which are lacked of relevant empirical research.