Do corporate websites’ changes reflect firms’ survival?

Abstract

PurposeThe purpose of this paper is to analyze to what extent changes in corporate websites reflect firms’ survival. Since keeping a website online involves some costs, it is likely that firms would invest resources on it only when they are active and healthy. Therefore, when a firm dies, this event is likely to be manifested on its website as lacking updates or being down.Design/methodology/approachChanges in the corporate websites of a panel of Spanish firms were tracked between 2008 and 2014 in order to evaluate the approach. The status of websites, classified according to the type of change undergone, was used to infer firms’ activity status (active or inactive). Multi-period logistic regressions and a duration model were applied to study the relationship among the website status and the firm’s status.FindingsResults showed that changes in website contents clearly reflect the firm’s status. Active firms were mainly associated with updated corporate websites, while inactive firms were more associated with down websites. In fact, results confirmed that the firms’ death hazard increases when the website activity lowers.Originality/valueAlthough online information is increasingly being used to monitor the economy, this is the first study to connect online data to firms’ survival. The results revealed a new source of information about business demography and evidenced corporate websites as a fresh source of high granularity business data.