How does local adaptation affect the internationalization performance? A multiple case study of the local adaptation efforts and internationalization performance of six Swedish e-retailers

Abstract

Although the technological advancements and the rise of e-commerce have made it easier for companies to sell their products worldwide, it should be noted that differences in customer preferences and behavior still exist. In order to remain competitive and attractive for the customers, the e-commerce companies should adapt to the local conditions beyond the most obvious ways, such as translating their websites. The view regarding the importance of local adaptation is shared both by the practitioners and the theory, however, there was a lack of research considering the role of local adaptation in the company’s internationalization performance. Local adaptation in the e-commerce context is defined as “the process of adapting websites in accordance with linguistic, cultural, technical, functional, legal, and other locale-specific requirements of the target market”. Thereby, the aim of this study was to gain an understanding on how local adaptation impacts the company’s internationalization. Local adaptation was studied from two perspectives: firstly, how the different types of local adaptation impact the internationalization performance and secondly, whether the amount of local adaptation has an impact on the internationalization performance. In order to study the relationship, a qualitative multiple case study was conducted with six Swedish e-retailers. The findings suggest that the grade of local adaptation does not directly affect the internationalization performance of the e-retailers, instead, the type of local adaptations has a larger impact on the performance. It is more important for the companies to choose the right types of local adaptation that are in line with their retail segment and customer preferences. In order to find the right types of local adaptation, e-retailers need to take into account their target group and gain local knowledge through different channels, such as local employees and influencers. This study provides e-retailers advice in how they can use local adaptation in their internationalization and increase their customer satisfaction.