E-commerce adoption by SMEs and its effect on marketing performance: An extended of TOE framework with ai integration, innovation culture, and customer tech-savviness

Abstract

Even though the benefits of e-commerce for Small and Medium-Sized (SMEs) are enormous, not many SMEs have adopted e-commerce, especially in Palestine. Therefore, knowing what factors encourage SMEs to adopt e-commerce is necessary. However, e-commerce research has only been carried out on large-scale businesses. In contrast, studies on SMEs companies, especially regarding adopting e-commerce, have not been widely conducted. So, this research is important to determine what factors drive the adoption of e-commerce and the effect on marketing performance in Palestinian SMEs. The study's theoretical foundation is based on the TOE framework with AI Integration, Innovation Culture, and Customer Tech-Savviness. Using a simple random sampling technique from an online questionnaire, 305 SMEs were chosen as the sample for the study. The data were evaluated using partial least squares structural equation modelling (PLS-SEM) to explore the relationships among exogenous, mediator, and endogenous variables. Based on the study's results, it can be concluded that AI Integration, Customer Savviness, innovative culture, competitive pressure and business partner pressure factors positively and significantly influence e-commerce adoption. In addition, adopting E-commerce positively and significantly affects SMEs' Marketing Performance. Based on the results of this study, theoretical implications for E-Commerce adoption in Palestinian SMEs and managerial implications are recommended accordingly.