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International Journal of Electronic Business Management, Vol. 9, No. 2, pp. 95-106 (2011)

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USING AHP FOR DETERMINING PRIORITY IN SEAMLESS STRATEGY: A CASE STUDY OF THE CLICK-AND-MORTAR BOOKSTORE Chien-Wen Chen1*, Chien-Lung Chan2 and Chiang-Yu Cheng3 1 Department of Management Business Administration Feng Chia University Taichung (40724), Taiwan 2 Department of Information Management Yuan-Ze University Taoyuan (32003), Taiwan 3 Department of Information Management National Central University Taoyuan (32001), Taiwan

ABSTRACT The click-and-mortar issue has attracted considerable attention in recent years. Many diverse arguments and viewpoints have been proposed to reinforce comprehension of seamless integration, but there has been little empirical research on how to develop an effective seamless strategy for consolidating the click-and-mortar environment. It is known that business capital is often scarce and different types of industries have different seamless strategy considerations; however, how to posit their expenditures in the right place on the basis of a priority method is seldom discussed. In order to provide a deeper view of the click-and-mortar decision making, this research divides the conceptual discussion into a proposed framework using the Analytic Hierarchical Process (AHP) to gain an integrated perspective to assist managers in placing business capital problems. It is argued that three types of support (logistics, technical and service) should be further extended and considered from seven seamless criteria for click-and-mortar evaluation. Two popular click-and-mortar bookstores in Taiwan were selected as the object. This framework generated several values for the enterprise to decide whether these seamless strategies should be adopted on the basis of its industrial characteristics. The research results can have practical implications for managers as they direct limited resources toward integrating and converging existing brick-and-mortar operations with a coherent and complementary Internet strategy. Keywords: Click-and-mortar, Seamless Strategy, AHP

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1. INTRODUCTION

Since the Internet meltdown in the millennium, most dot-com companies have failed to meet investors’ expectations and rapidly vanished. This phenomenon does not suspend the growing use of the Internet as an essential business tool; e-commerce is still playing a major role in many industries [15]. Now, retailers have recognized that they need a complementary outlet in order to survive and then altered their business model to a distinct one, so-called “click-and-mortar”. Click-and-mortar is defined as a store integrating both online and offline *

Corresponding author: [email protected]

channels [4], however, such integration results in pros and cons. On one hand, it provides many pros that retailers can combine synergistic incentives originally belonging to offline or online channels. On the other hand, click-and-mortar presents cons that channel conflict may occur to confusing retailers. Because retailers may sell their products through both offline and online channels, they plunder the same customer segmentation incidentally. As a result, channel conflict is inevitable and how to develop effective strategies for companies consolidating their channels seems to be important. Gulati and Garino [4] also suggested that retailers who can execute click-and-mortar strategies that bridge the physical and virtual worlds will be success in the future.

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In prior research, there have been active studies on seamless strategies and their evaluation based on the channel integration and the success of multiple channels. Ranganathan et al. [17] proposed a strategy grid in a quadrant with both innovation and integration axes. Saeed et al. [19] also designed a strategic grid in a quadrant with geographic axes and a physical interface with the product axis, after which further correlation analysis was done. Gulati and Garino [4] proposed a click-and-mortar spectrum for firms to identify how closely or loosely to integrate their online with their offline operations. Steinfield et al. [22] developed a conceptual framework by a case study that highlights the four types of synergies obtained by integrating e-commerce with physical infrastructures. Willcocks and Plant [26] addressed the answers to several questions which largely determine the success of click-and-mortar companies. Although these studies contribute to understandings by developing conceptual frameworks that consider which strategies click-and-mortar firms adopt to improve their competitiveness, none is concerned with the priority of the selected criteria. Yet a firm is at a competitive disadvantage when the implemented strategies that are not valuable [9]; thus “doing right thing” is always more important than “doing thing right.” Hess and Lucas [6] also claimed that resource allocations are costly, firms must decide the allocation of their scarce resources. Therefore, it is necessary to identify the priority of seamless strategies among criteria which affecting success factors in click-and-mortar firms. Specifically, a more effective method needs be employed in deciding whether or not to posit their expenditure on various channels and what aspects of seamless strategy should be adopted. The purpose of this study is to convert managers’ subjective perceptions of seamless strategy evaluations in the click-and-mortar environment. The priority method of AHP is used to determine managers’ responses to the click-and-mortar context. AHP is one of the most widely used multiple-criteria decision-making tools [25] aimed at integrating different measures into a single comprehensive score for ranking decision alternatives [11]. Saaty [18] also suggested that AHP is suitable for complicated decisions involving trade-offs among multiple criteria. In this regard, some options are considered in the decision making that make it possible for a firm to adequately determine whether specific seamless strategies should be adopted. We present a case of click-and-mortar bookstore that demonstrates the effectiveness of the proposed method.

2. CLICK-AND-MORTAR TRENDS The consumers may be involved in not only online but also offline channels. A recent survey by Jupiter Media Matrix [7] showed that 83% of online customers would like to return online purchases at offline stores. Another survey by the Institute of Information Industry, Taiwan (2006) found interesting results that only 17% of pure play models had been alive at all; whereas 83% of click-and-mortar retailers predicted profits within the next two years. It is obvious that pure-play business models will tend to be of the click-and-mortar type; moreover, the biggest winners will be firms with a strong presence in both the offline and online. Saeed et al. [19] also claimed that companies are working on exploiting synergies between physical infrastructures and virtual channels to provide better service to customers, whereby seamless integration among organizational processes provides great potential for excellence in customer service. Thus, a well designed evaluation model in a click-and-mortar context must provide an adequate offline and online seamless strategy to meet customer needs. On the basis of this seamless strategy, managers can look for ways to integrate their online and offline business components to achieve economies of scale, reduce channel conflict and obtain an edge over their traditional rivals as well as new net-based competitions [16].

3. DEVELOPMENT OF AHP MODEL The AHP is one of the most well known decision-making methods to assist in the complex task of reaching the best decision from a set of possible criteria. The AHP provides a mathematically based application and proven process for prioritization of alternatives. By decreasing complex decisions into a series of pairwise comparisons and synthesizing the results, managers acquire the best decision based on an unequivocal rationale. When faced with qualitative data which is difficult to convert into quantitative terms, the AHP is a suitable method for undertaking quantitative as well as qualitative analysis [5]. Moreover, the AHP can be used whenever a decision problem can be represented by a hierarchy or cluster of hierarchies resting on the assumption of an overriding object or goal [18]. Indeed, a click-and-mortar evaluation has multi-criteria and weights for each factor of the seamless strategy. The establishment of weights and priorities for the click-and-mortar criteria is an important phase in implementing a seamless strategy

C.W. Chen et al.: Using AHP for Determining Priority in Seamless Strategy in a practical and successful manner. Most importantly, the use of decision analysis methods is not yet widespread in corporations [21]. For these reasons, the AHP was selected for use in determining the major criteria for the click-and-mortar environment. 3.1 Evaluation Criteria In this study, we assume that the click-and-mortar seamless strategy decision is based on three groups of criteria categories as shown in Figure 1. This grouping is not exhaustive but serves as a demonstration of this assumption. Other criteria can be added to the model based on specific characteristics of a given industry. After discussions with managers, web engineers and members of MIS faculties, the features of a seamless strategy are identified by reviewing the literature on click-and-mortar evaluation. The four alternatives included in our case are: lowering costs, differentiating through value-added services, enhancing trust, extending the market. A brief explanation of these criteria is shown in Figure 1.

Figure 1: Major criteria adapted from related literature 3.1.1 Logistics Support Because a click-and-mortar operates on multiple channels, the logistics must be integrated to support its operations, (e.g., when a customer makes a purchase online and chooses to pick up the product at a physical store). The important factors associated with click-and-mortar operations include inventory, transportation, warehousing [14], delivery speed, delivery time flexibility and delivery reliability [3]. Strictly, these factors can be further grouped into two categories, logistical integration and distribution efficiency, since the logistical operation must be linked with their information infrastructure for catering to the flexibility demands of the distribution system [19]. Logistical integration represents the process integration involved in setting up the click-and-mortar operation [19]. The components include inventory (the integration of inventory management and control), transportation (routing the

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products through a transfer post) and warehousing of products according to Pelton et al. [14]. The distribution efficiency proposed by Gulati and Garino [4] represents operating quickly and effectively in an organized way. For example, since the logistics system is one of the most important issues in a click-and-mortar environment, someone very efficient, who can organize the logistical operation and make it run smoothly, is needed. The components include delivery speed (how fast customers can receive their orders), delivery time flexibility as chosen by customers and delivery reliability according to Garvin [3]. These are the most common roles of the elements within distribution channels, since logistical support failures decrease the customer’s satisfaction in the click-and-mortar environment. 3.1.2 Technical Support Because e-commerce system operates on the basis of information technology, technical support is usually considered when setting up a strategy for B2B, B2C and C2C. Therefore, in a click-and-mortar environment, technical support refers to those features that the firm provides, and generally to how well the integration can meet the customer’s demands. Since techniques are the driver for converting traditional relationships into e-relationships between sellers and buyers, the integration of different techniques provided by technical support can assist the firm in reaching its seamless objective. By reviewing the literature, three criteria for technical support, including information sharing, information integration and content integration were devised, as summarized in Table 1. Information sharing Information sharing implies that the systems cannot only provide complete product, order and timely inventory information but also share this information among different channels. Like a tunnel bridging the two sides of a hill, by providing offline-to-online information, a website can actually increase the traffic at its physical outlets [4]. Thus, according to [20], order, operational and strategic information should be shared with all players in the chain. Information integration Integrated information systems can allow customers to locate the nearest store, check inventory and order through the channel of their choice [19]. The seamless information strategy combines customer profiles and transaction histories with different aspects, such as marketing information system, kiosks, online stores, etc. This customer-oriented information allows firms to extend the relationship between seller and buyer and also

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respond in an accurate, quick manner to their customers, regardless of whether an order is placed through a physical store, a website or any other contact point. Therefore, the integration of all

channels across all areas in the company is critical [13].

Table 1: Sub-criteria and their attributes adapted from related literature Literature Attributes Literature Inventory Logistical integration Saeed et al. [19] Pelton et al. [14] Transport Warehouse Delivery speed Distribution efficiency Gulati and Garino [4] Garvin [3] Delivery time flexibility Delivery reliability Order information Information sharing Gulati and Garino [4] Seidmann and Sundarajan Operation information [20] Strategic information Customer profile Informational integration Saeed et al. [19] Pan and Lee [13] Transaction history Account history Relevance Content integration Saeed et al. [19] Mckinney et al. [10] Timeliness Reliability Strength Established brand Gulati and Garino [4] Keller and Sood [8] Diagnosticity Inconsistency Better logistics Purchasing leverage Gulati and Garino [4] Ofek and Sarvary [12] Acquisition cost Build community Sub-criteria

Content integration Contents on the website can be divided into two categories, dynamic and static content. A general definition of dynamic content is a one that anticipates actuality. Conversely, static content is not dependent on actuality. Specifically, to integrate these energetic contents is an important task in the click-and-mortar environment. For example, a customer wants to search for product information at the website and visit a physical outlet to preview the product before purchasing or use the product code obtained from the catalog to order the product online. If the contents provided by a channel are not consistent with the contents provided by others, how can the customer make a judgment on preferable products and make a purchase decision? Without content integration, the click-and-mortar might revert to the infancy stages before widespread use of the Internet where the database was a stand-alone system. Therefore, content integration is often referred to as precise information provided for a collaborative environment. Three attributes of content integration derived from Mckinney et al. [10] consisting of providing information with relevance (issues such as relevance, clarity and goodness of information), timeliness (currency of information) and reliability (degree of accuracy and consistency) are introduced.

3.1.3 Customer Service Customer service encompasses the seamless strategies that click-and-mortar firms use to consolidate the customer’s experience. The purpose of customer service is to reinforce the opportunity to communicate with customers and thereby to improve their experience. However, all these acquisition activities significantly influence the brand’s impression upon contact. In the click-and-mortar environment, brand refers to a composite concept allowing firms to consider the seamless connection between an established brand and an Internet brand. For example, a company might want to extend its physical brand into online sales or seek a partner with an existing online brand. Yousafzai et al. [27] also asserted that customers will have high trust toward websites whose brand names are familiar in the physical environment. Therefore, a critical issue for affecting selection between these strategies is the strength and diagnostic of an established brand. On the other hand, firms can provide their seamless service by using the Internet to leverage customer relationships built up offline and acquire customers economically. Firms can either introduce their promotions or new products to specific customers on the basis of virtual community or provide better logistics by leveraging their experience to make the transactional features of their business more efficient

C.W. Chen et al.: Using AHP for Determining Priority in Seamless Strategy [12]. Therefore, leverage capability stands as a symbol of seamless customer service. 3.2 Alternatives In order to discuss the click-and-mortar seamless strategy, four strategies were considered in the bottom level of the AHP model: lowering costs, differentiating through value-added services, enhancing trust, extending the market. These four distinctive strategies represent the general framework for synergy applications and benefits under the click-and-mortar environment [22]. These are discussed in further. Alternative 1: Lowering costs Steinfield et al. [22] suggest that the click-and-mortar mechanism still has an important role to play in using the most effective strategy created by lowering cost. The retailers use the alignment of channels to lower their essential costs. For example, when offline and online outlets are operated simultaneously, a great deal of potential cost reductions becomes possible, such as personnel, inventory and delivery costs. In fact, personnel costs are shifted to customers for such activities as searching product information, filling out order forms, and relying on online technical assistance for customer self-service. Inventory savings arise from the potential reduction in local supplies of infrequently purchased goods. For retailers that work through wide territory of local points of sale, inventory savings can also be achieved by eliminating local offices or shops, and serving customers electronically. Delivery savings may come from providing the physical outlet as the pick-up location for online customers. Alternative 2: Differentiating through value-added services Differentiation can be regarded as an efficient instrument helping firms to excel in a competitive market. Differentiation can also protect the price from cost competition. However, with regard to click-and-mortar, providing differentiation through value-added services is more important for successful business. A seamless strategy can provide the additional service. For example, a customer can check product information in an online channel and pick up the product physically or an online ATM (Automatic Teller Machine) channel to reduce the customer’s time spent on payment. These combined-channel approaches enable firms to offer new types of services that enhance customer value and help differentiate [22]. Alternative 3: Enhancing trust Without exception, trust is the basis for any type of e-commerce transaction. For example, (1) In a

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B2C environment, a customer makes an order online and chooses to pay cash on delivery. This is a typical payment mechanism for enhancing customer trust. (2) In a B2B environment, a lump-sum payment is not a common method chosen by the supplier and demander; rather, they usually liquidate their transaction per-month or in accordance with their contract. Therefore, the financial service provider should follow a sophisticated trust strategy, because this industry is so dependent on strong trust [22]. (3) E-commerce encounters a problem because of the trust inherent in the invisible interaction. The most common concern is how to insure that the buyer pays for the products and the seller sends the products to the buyer. The buyer and seller are characterized by anonymity in entering or leaving. Thus, a trust-enhancement strategy for managing trust in the click-and-mortar would be important. At this time, physical outlet can help customer reducing their online uncertainty. Alternative 4: Extending the market A strategy for extending the market emphasizes the use of multiple channels to help extend the capability of a firm beyond its traditional physical channels. The role of the click-and-mortar facilitating extension into new geographic markets is commonly recognized. The use of an online channel complements and consolidates rather than operating only in a physical channel by allowing firms to solicit new customers and offer new products to established customers. This also enables firms to consistently serve customers who intend to migrate to other channels of existing outlets. Steinfield et al. [22] suggested two categories of market extension, namely product-market and geographic-market extensions.

4. CASE STUDY In this research, three steps toward establishing an AHP model were implemented as suggested by Saaty [18]. (1) Decomposition: This step requires the construction of a hierarchical model to identify its goal. The highest level represents the overall objective; the sub-level, the criteria and the bottom level, the alternatives. The objective was to evaluate the seamless strategies needed for success in the click-and-mortar environment. Hence, the major objective, seamless strategy evaluation is placed at the highest level. Moreover, the major criteria for measuring the objective are identified. Three criteria (logistical support, technical support, customer service) were adopted in the related literature; moreover, these criteria, sub-criteria and attributes were further recognized by interviewing the experts including managers, faculty and website

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engineers (see Figure 1 and Figure 2). Gradually, seven sub-criteria were placed at the sub-level, including logistical integration and distribution efficiency related to logistics support; shared information, informational integration and content integration related to technical support; established brand and purchasing leverage related to customer service. These seven sub-criteria certainly have their own attributes, summarized in Table 1. Figure 2 outlines the framework of the AHP model. Finally, four alternatives were placed at the bottom level, including lowering costs, differentiating through value-added services, enhancing trust and extending the market. (2) Pair-wise comparison: The purpose of this step is to compare the criteria at the same level and estimate their comparative value to the major objective. A judgment matrix was built by pair-wise comparisons made among all the criteria at each level in the hierarchy model. These matrices elicit qualitative judgmental statements representing the intensity of the respondents’ feelings. Saaty [18] suggests the use of a 1-to-9 scale to quantify the strength of the decision maker’s feelings between any two alternatives with respect to a given attribute. Thus, a scale ranging from 1 to 9 was designed to obtain respondents’ feelings. These three criteria were compared to estimate their contribution to the objective. Moreover, seven sub-criteria and their attributes were also compared to estimate their influence on each related criterion, and the four alternatives in each pair were also compared. (3) Priority establishment: Once the criteria have been estimated, this step identifies composite weights and their relative importance to the alternatives. Then is acquired the priority of the seamless strategy for success in the click-and-mortar environment. 4.1 Data Collection After developing the hierarchy framework of AHP, the next necessary step is to conduct the data collection. We sent questionnaires for 30 evaluators (employees and managers) who are frequently involved in click-and-mortar operations. Of these respondents, two are senior managers from our research cases. Each one of them has more than five years of experience in decision making. The remaining respondents are employees from the marketing department (n=11), customer service department (n=13), and technical department (n=4). The nine point scale as recommended by Saaty (1995) was used to assign pair-wise comparisons of all elements in each level of the hierarchy and

alternatives. The collected data that have the inconsistency ration of more than 0.1 were removed. The chosen cases are described as follows. 4.2 Book Retailers in Taiwan Bookstores in Taiwan can be identified into two major categories; one is online book retailer without brick-and-mortar outlets such as Books.com.tw, and the other is based on physical bookstore chains that have already existed for years, like Eslitebooks.com and Kingstone.com.tw. Eslitebooks Co. Ltd is a click-and-mortar bookstore founded in 1989 stocking more than a thousand different books including Chinese as well as foreign books, children’s books and several digital products. Having expanded to 48 branches islandwide, this retailer now is a leading company in its sector in Taiwan. Whereas Kingstone Co. Ltd is another click-and-mortar bookstore founded in 1983, stocking more than a thousand different books including of Chinese books as well as foreign books, Japanese magazines and online personal bookstore. Having 74 branches islandwide, it is now the second most-popular click-and-mortar bookstore in Taiwan. Eslitebooks focuses exclusively on providing refined products and foreign books to segment the market; however, Kingstone focuses on providing lower-priced books and makes co-purchase with its physical outlets to negotiate prices with publishers. According to a survey by Pollster Technology Marketing Ltd., Kingstone and Eslitebooks are the two most preferred click-and-mortar bookstores for customers, being ranked at 41.71% and 37.05% respectively. Hence, these two best-representative B2C retailers were chosen for this research.

5. RESULTS AND DISCUSSION From Figure 3, the case analysis indicates that the customer-service criterion has the highest weight of 0.674, followed by the logistical-support and technical-support criteria, weighted at 0.226 and 0.101, respectively. Thus, in addition to technical support, customer service and logistical support are the most preferred criteria for adoption by a click-and-mortar bookstore. Indeed, customer service is becoming a critical issue in the modern B2C environment, and logistical support is a mechanism for delivering such services. After calculating the priority of each criterion and sub-criterion in the hierarchy framework, four alternatives were evaluated to carry on the analysis. The overall priority of the seamless strategy alternative was calculated by multiplying its local priority and its corresponding weight along the hierarchy to obtain the synthesis results.

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Figure 2: Hierarchy framework for seamless strategy evaluation The result of the evaluation gave these alternatives priority values of lowering costs (0.306), extending the market (0.306), enhancing trust (0.208) and differentiation through value-added services (0.179), respectively. It is noteworthy that lowering costs and extending the market are ranked at the same value, indicating that click-and-mortar bookstores in Taiwan are likely to concentrate more on these two strategies. Since consumers are always interested in comparing the price of their favorite books across many online bookstores, providing low prices everyday is becoming an essential strategy. Firms desiring to earn profits are no longer focusing on cutting prices, yet they must earn profits by lowering their costs in other ways. On the other hand, extending the market is also a good way to avoid price fighting. By extending their markets to physical outlets, firms can gain more touch points with their customers and effectively differentiate with other competitors (e.g. a physical bookstore can easily use delicate decoration and background music to create a special atmosphere which may be a main reason to attract customers).

Goal: B2C seamless strategy evaluation Customer service (L: .674) Established brand (L: .500) strength (L: .637) diagnosticity (L: .258) consistency (L: .105) Purchasing leverage (L: .500) better logistics (L: .114) acquisition cost (L: .405) build community (L: .481) Logistics support (L: .226) Logistical integration (L: .500) transport (L: .139) warehouse (L: .773) inventory (L: .088) Distribution efficiency (L: .500) delivery speed (L: .132) delivery time flexibility (L: .694) delivery reliability (L: .174) Techical support (L: .101) Information sharing (L: .096) order information (L: .333) operation information (L: .333) strategic information (L: .333) Information integration (L: .105) customer profile (L: .078) transaction history (L: .435) account history (L: .487) Content integration (L: .799) relevance (L: .185) timeliness (L: .659) reliability (L: .156)

Figure 3: Priorities for criteria, sub-criteria and attributes

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5.2 Sensitivity Analysis Sensitivity analysis is a kind of post-hoc analyses that explores the impact of changing the weights on the overall results [2]. This method is particularly important to the determination of the criteria in the proposed framework that needs only a small change in weight to cause a switch in rank of alternatives [23]. Bodin and Gass [1] also argued that all AHP studies should include the appropriate sensitivity analyses to determine break points for which the fist and send ranked alternatives. We therefore examine the response of the overall priorities of the four alternatives to changes in the relative importance of each criterion. Here, gradient sensitivity analysis was conducted using Expert Choice software. Gradient sensitivity analysis represents the range by which a given criterion can change before if affects choice of alternatives evaluated [2]. If the overall alternatives do not change much to variations in weights, this suggests that the recommended results are fairly stable and reliable. The vertical line represents the current priority of the .40

selected criterion. The slanted lines represent the alternatives. As shown in Figure 4, the current priority of an alternative is where the alternative line intersects the vertical criterion line. The result indicates that both lower costs and extending the market are the most preferred strategies; moreover, the ranking of the remaining alternatives is stable with respect to changes in the importance of customer-service criteria since enhancing trust and differentiation through value-added services remain the same. On the other hand, Figure 5 shows that when the priority of the logistical support is increased from 0.22 to 0.77, the best choice is extending the market. However, when the weight of the logistical support is more than 0.77, enhancing trust becomes the best strategy. This indicates that if logistical support is highly valued by a manager, enhancing trust will be the most preferred strategy to choose. These features make it possible to perform what-if analysis once the scenarios are changed.

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Figure 5: Sensitivity analysis to obtain overall priorities (logistical support)

C.W. Chen et al.: Using AHP for determining priority in seamless strategy 5.3 Managerial application and implication As we mentioned in introduction section, strategy selection is an important issue to a click-and-mortar firm. We first identify three strategic factors and defining their criteria and sub-criteria, and then formulate an AHP evaluation framework to select the alternatives of click-and-mortar strategies as illustrated in Figure 2. The proposed framework is applicable to strategy selection problem of a click-and-mortar bookstore. After obtaining global priority weights, adoption firms can easily determine the final composite priority weights of alternatives occupying the last level of the hierarchy. In general, applying this method, managers are able to answer the following questions: 1. Which seamless strategies can be improved to increase competitiveness? 2. Due do the limited resources, which strategies should be given the highest priority. 3. Understanding the seamless strategies that most require improvement. 4. Conducting a method in a way that provides a seamless perspective in managing click-and-mortar operation. Click-and-mortar is increasing rapidly owing to the growth of Internet technologies and the unique advantages of the virtual presence itself. The major concept of channel integration lies not only in providing customers with online services such as 24 hours operation, ordering online, but also in providing customers with physical outlet for product delivery or product preview before purchase. Thus, developing synergistic strategies is differs from that of offline and online channels. This study proposed a framework for choosing click-and-mortar strategies according to managers (or employees) perceptions. We suggest that click-and-mortar bookstores need to emphasis more on dimensions, including lowering costs and extending the market and their attributes. Meanwhile, we should treat enhancing trust and differentiation through value-added services as two must have strategies in that they are commonly deployed in many B2C websites. Indeed, it is difficult to provide best price for customers with high operation costs. By the effectiveness of channel integration, firms can cut down their operation costs as well as providing their services across different channels.

6. CONCLUSION In this research, an evaluation framework has been proposed for the click-and-mortar seamless strategy in a click and mortar bookstore which depends on the criteria of logistical support, technical support and customer service. The AHP method was

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implemented to evaluate the importance of four seamless strategies, including differentiation through value-added service, lowering costs, extending the market and enhancing the trust. The results of this analysis reveal several implications. First, we provide the practitioners with a systematic method to reduce the difficulty of seamless strategy selection. Second, lowering costs and extending the market are both ranked as the best strategies. That is, they exist primarily on the physical store, but an online outlet is also born from their business success. By adopting these strategies, channels can both produce complementary synergy and reduce customer acquisition costs. Finally, the developed model can be very helpful in supporting managers in click-and-mortar seamless strategy selection, since business capital is always scarce and expenditure should be judicious.

7. FUTURE RESEARCH AND LIMITATIONS The findings of this research were analyzed in accordance with several limitations. First, although the number of sample industries might seem insufficient, they are all leaders in their respective sectors in Taiwan. Second, the results of this research should be carefully interpreted, since the samples were chosen from only Taiwan. Finally, the complex click-and-mortar environment is rapidly changing all the time; therefore, the evaluation criteria should be further updated so that the seamless strategies can be evaluated in a timely manner.

ACKNOWLEDGEMENT Research was supported by the National Council of the Republic of China under grant NSC 99-2410-H-035-035.

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ABOUT THE AUTHORS Chien-Wen Chen is an Associate Professor at the Graduate Institute of Business Administration, Feng Chia University, Taiwan R.O.C. He received his doctorate in Industrial Engineering and Management from National Chiao Tung University, Taiwan, ROC. His current research interests include e-commerce, decision science, and operational management. He has published papers in Asian Journal of Technology Innovation, International Journal of Production Research, Behaviour & Information Technology, Integrated Manufacturing Systems, and Journal of Information Management. Chien-Lung Chan was educated at University of Wisconsin-Madison, USA and received the degrees of Ph.D. in Industrial Engineering (1995) and M.S. in Health System (1993). His work experience includes

C.W. Chen et al.: Using AHP for determining priority in seamless strategy Deputy Chief Information Officer of Yuan Ze University, Taiwan, research assistant in Center of Health System Research and Analysis (CHSRA), University of Wisconsin-Madison. He was the principal investigators in many projects including research and planning of the overall network architecture, information system application and education/training of the fundamental public health administrative units, the Total Quality Management of healthcare organizations, and the planning and implementation of National Immunization Information System (NIIS) in Taiwan. At present he is an Professor and department chair of Department of Information Management, Yuan Ze University. His current research interests are project management, decision science, decision support system and healthcare.

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Chiang-Yu Cheng is currently a Ph.D. candidate at Nation Central University, Taiwan and is working as a research assistant for National Science Council, Taiwan. His research interest lies in e-commerce, information management, and decision science. He has published papers in Computers & Education, Behaviour & Information Technology, and Journal of Information Management (in Chinese). (Received August 2009, revised October 2009, accepted January 2010)

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International Journal of Electronic Business Management, Vol. 9, No. 2 (2011)

應用層級分析法於無縫策略之評選 －以虛實整合書店為例 陳建文 1*、詹前隆 2、鄭江宇 3 1 逢甲大學企業管理學系 台中市西屯區文華路 100 號 2 元智大學資訊管理學系 桃園縣中壢市遠東路 135 號 3 國立中央大學資訊管理學系 桃園縣中壢市中大路 300 號

摘要 近年來虛實整合經營模式日漸受到矚目，過去相關研究提出甚多觀點及討論，試圖 強化各通路之間的連結性，然而截至目前為止仍少有實證研究將其焦點擺放在虛實 整合策略之探討。策略多樣性常與企業有限資源互為衝突，因此如何在有限資源情 況下，妥善配置虛實整合經營策略實為重要。本研究以虛實整合網路書店為對象， 藉由層級分析法將三大支援（物流支援、技術支援、服務支援）細分為七項評估準 則，試圖自眾多經營策略之中找出重要性排序，以供虛實整合經營者之參酌。研究 結果顯示，無縫經營策略之採用宜顧及企業自身的產業特性，以便回應通路整合或 資源配置之需求。 關鍵詞：虛實整合、無縫策略、層級分析法 （*聯絡人：[email protected]）