Digital strategies for market dominance: empirical evidence from the insurance industry

Internet, Web 2.0 and digital and mobile technologies have fundamentally changed the way firms perform, conceive, develop and deliver services, leading to the development of personalized relationships with customers, increasing quality, improving lead time, and enabling more customization at a lower cost. These channel proliferation has increased the complexity of firms’ operations because it opens up new customer contact points. In today's rapidly changing environment, firms need to diversify, adapt, and even reinvent themselves to match evolving market and technological conditions and to turn themselves into multichannel organizations. The multichannel model may generate more sales and profit when channel benefits are well identified and integrated to provide service transactions across channels. Thus, the success of multichannel service bases on how companies capitalize optimizes digital touch points to interact with consumers. The goal of this dissertation is to further develop our understanding of the impact of digital channels on multichannel attribution and devise effective multichannel strategies that increase synergy effects to reach consumers across channels. In the first paper, I examined how managing seamless service transactions across channels impact competitive advantage. A great amount of literature has focused on multichannel distribution strategies but there is a little theory or systematic research on the relationship between multichannel strategy and competitive advantage. In this vein, scholars have called for specific research efforts to better understand how the use of digital, online and offline distribution channels could lead to sustainable competitive advantage. Based on the dynamic capability and IT capability literature, this essay aims to contribute to this body of knowledge by first conceptualizing a new IT capability named multichannel capability that is “the ability of an organization to effectively integrate and manage multiple distribution channels through data integration and coordination enabled by IT”. I used a quali-quantitative research design to 1) to investigate what are the main dimensions that comprise multichannel capability and 2) to understand how the relationship between multichannel capability and competitive advantage emerges. This study allows understanding how the firm's multichannel capabilities influence the creation and sustenance of competitive advantage in turbulent environments. In the second paper, I examined the ways in which companies manage their reputation in social media, focusing on the role of communication strategies. Previous literature has demonstrated that corporate communication has a direct impact on corporate reputation, although little is known about the link between firms’ social media communication strategies and the formation of firms’ reputations in an online environment. This essay aims to contribute to this body of knowledge by studying the impact of social media communication strategies on firms’ reputations. To explore how firms manage corporate reputation in online environments, I employed a longitudinal explorative multiple-case study (Eisenhardt, 1989). The setting for our study is the insurance industry. The analysis led to the recognition that, among the various types of companies (high, medium, and low reputation), the differences in reputation are attributable to four basic dimensions: categories of communication strategies, the evolution of communication strategies across three years (2011-2013), the timing of interaction, and the number of interactions. These results offer insights into the challenges of developing online communication strategies that affect corporate reputation. In the third paper, I examined the main difference between business models exploited by European insurance companies. A business model describes a formula of unique value creation. It consists of a unique value proposition and profit-making formula as well as key resources and process coupled together as a system to operationalize value creation. Research on business model in global competition has not yet prominent in academic discourse. In particular, how some firms operating in multiple international markets adopt "one for all" business models while others opt for heterogeneous business models that work for multiple international market settlements is not fully understood. This paper attempts to fill this gap by proposing a maturity model that enables observations of how the same company creates value distinctively in the global marketplace. I employed a multiple case study in the European insurance market. This research makes several contributions to insurance companies. First, the components of e-business models identify in my framework of industry leaders serve as benchmarks for e-business models of competitors. Secondly, we offer some practical guidance to managers to develop a successful business model in different markets.