The impact of marginalization on entrepreneurs’ online presence and firm performance

Abstract

Purpose This study aims to examine the relationship between marginalization, Web presence and firm performance for small- and medium-sized enterprises (SMEs). Design/methodology/approach This study relies upon interviews and surveys of managers and/or owners of SMEs. Using confirmatory factor analysis and structural equation modeling, the authors tested an integrated model of the relationship between marginalization, Web presence and firm performance. Findings Findings indicate that marginalization enhances the risk perceptions entrepreneurs assign to internet use. This enhanced risk perception then limits the extent to which an entrepreneur responds to online customer feedback, which has implications for the SME’s relationship and reputation management efforts with buyers, ultimately impacting the enterprise’s performance. Originality/value This study sheds light on the overlooked phenomena of marginalization and internet avoidance among entrepreneurs. The findings provide insight for entrepreneurs on the deleterious consequences associated with lacking an online presence.