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Market reaction to the announcement of online sales channel investment in enterprises: Evidence from a relatively stable market environment

Author

Listed:
  • Yang Lei

    (Southern University of Science and Technology)

  • Qiang Zhou

    (Hong Kong Shue Yan University)

  • Waiman Cheung

    (the Chinese University of Hong Kong)

  • Xiling Cui

    (Hong Kong Shue Yan University)

  • Ling Peng

    (College of Information Management and Statistics, Hubei University of Economics)

Abstract

Although relevant literature investigates the economic value of online sales channel (OSC) from the perspective of the stock market, knowledge on this topic remains insufficient or unclear because existing studies are conducted under an extremely turbulent market environment and have not considered different aspects. This study aims to examine the topic by focusing on the market reactions to OSC investment from three aspects (namely, the innovativeness, business model and goods types) in a relatively stable market environment to fill in the research gap. Empirical results, obtained using 69 firm-level OSC announcements from October 2002 to September 2007, show that the stock market reacts positively to OSC investment by firms. Additionally, the stock market reactions to OSC investment mainly depend on two key characteristics, namely investment innovativeness and business model applied.

Suggested Citation

  • Yang Lei & Qiang Zhou & Waiman Cheung & Xiling Cui & Ling Peng, 2023. "Market reaction to the announcement of online sales channel investment in enterprises: Evidence from a relatively stable market environment," Electronic Commerce Research, Springer, vol. 23(2), pages 973-1005, June.
    • Handle: RePEc:spr:elcore:v:23:y:2023:i:2:d:10.1007_s10660-021-09500-0
    DOI: 10.1007/s10660-021-09500-0
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