Business strategy and business environment: The impact of virtual communities on value creation

• Published date: 01 September 2019
• Date: 01 September 2019
• Author: Eleanor McIntosh,Barry Ardley
• DOI: http://doi.org/10.1002/jsc.2287

RESEARCH ARTICLE

Business strategy and business environment: The impact

of virtual communities on value creation

Barry Ardley

1

| Eleanor McIntosh

2

1

Lincoln International Business School,

University of Lincoln, Lincoln, United Kingdom

2

Marketing Department, Houghton

International, Newcastle upon Tyne, United

Kingdom

Correspondence

Barry Ardley, Lincoln International Business

School, University of Lincoln, Brayford Pool

Campus, Lincoln, LN6 7TS, United Kingdom.

Email: bardley@lincoln.ac.uk

Abstract

The impact of new forces in the firm's business environment means that strategy and

value are now delivered and captured in digital spaces occupied by virtual communi-

ties of customers. These strategic changes have made possible the sharing of value

creating practices between consumers and firms, where customers are now highly

influential in brand decisions. Technology has made it possible to co-opt customers

directly into the product design process. Many customer facing strategy processes

and practices have been transformed due to changes in markets, technology, and the

business environment.

1|INTRODUCTION

In today's business world, technology is seen as a vital spur for the

restructuring of commercial activities and business development strat-

egies. Digital technologies in particular, have proven to be the drivers

of economic growth and competitiveness (Ap

av

aloaie, 2014;

Manyika & Roxburgh, 2011). These technologies have had a concomi-

tant and significant impact on marketing practice (Berthon, Pitt,

Plangger, & Shapiro, 2012). For the business environment, the techno-

logical revolution that is represented by the Internet, has created an

emergent framework that has provided producers with an opening to

consumers around the world. It is a process that creates and facilitates

a permanent interactive dialogue with them. This opening to con-

sumers has important implications for any firm that recognizes the

Internet as a tool for business development both nationally and inter-

nationally. Increasingly this is many businesses, as the Internet is now

used in every country, in every sector, in most companies, and by

more than 2 billion people and it is still growing. Online commerce has

generated a volume equal to about 8.000 billion and it is estimated

that, worldwide, the Internet generates significant added value

(Manyika & Roxburgh, 2011). To be competitive, organizations must

adopt these new Internet based technologies in order to not only

develop their business models, but to manage costs and customers

more effectively. The Internet also enables companies via a variety of

platforms, to not only explore consumer's behavior, but also to

establish close relationships with customers and develop loyalty

(Stanfield, 2013; Weber, 2009). Now, not only are new types of prod-

ucts developed in conjunction with customers on Internet platforms

(Filieri (2013), but there are also new markets and new research

methods that are accessible, that can stimulate the businessperson to

be competitive, innovative, and creative. Through the Internet, the

organization can build or enhance its competitive advantage (Teo &

Yeong, 2003).

Any perceived lack of an online presence induces in customers the

feeling that they are dealing with a meager company and become reti-

cent, when contemplating the purchase of its products. There are now

major changes occurring, changes in how information is used, in terms

of contacting customers, suppliers, and employees. It is clear that the

not only changing every aspect of our lives, but is having a major

impact on the business environment. Today, both large companies

and small ones are using the web to communicate with their partners,

to connect to their systems and databases and to make transactions

(Weber, 2009). We are seeing the growth of open innovation plat-

forms on the Internet, shared production and supply systems and

logistical strategies being implemented through the development of

digital systems (Ap

av

aloaie, 2014). There is little doubt that very fun-

damental shifts are occurring in how people are organized into

increasingly flexible and multi-layered networks as a result of Internet

participation. In the context of this article and marketing strategy,

what is particularly important is the ability of firms and their cus-

tomers, to now organize communities of Internet participants, in order

to develop markets, conduct dialogues, support products and services,

JEL classification codes: A12, M30, M31.

DOI: 10.1002/jsc.2287

Strategic Change. 2019;28:325–331. wileyonlinelibrary.com/journal/jsc © 2019 John Wiley & Sons, Ltd. 325