Adoption of E-Commerce for Small and Medium Enterprises: Empirical Study in Indonesia

Abstract

Each company must have the competitiveness to support its marketing performance. E-Commerce applications offer an effective alternative marketing system with a relatively low cost. However, the rate of adoption of information technology by small and medium enterprises (SMEs) are still limited. Madura batik craftmen as one of the potential industry in Indonesia has been struggling to market their products in the global market. In an effort to help expand the reach of marketing for SMEs in the global market, it requires a strategy to accelerate the ability of SMEs to adopt E-Commerce.

This study used a qualitative approach. Methods of data collection wasconducted using in-depth interviews and focus group discussions. The results showed that the adoption of information technology, especially the E-Commerce for the Madura batik craftmen still relatively low. In general, Madura batik craftmen have a good perception of the benefits of E-Commerce, however, they considered the technology of E-Commerce is relatively difficult to implement in support of batikmarketing.The main reason that drives the batik craftsmen to adopt E-Commerce are the benefits of E-Commerce to increase competitiveness, enhance marketing performance as well as the encouragement of external factors. On the other hand, an inhibiting factor for SMEs to adopt information technology are cost constraints, human resources and information technology complexity. In addition, the protection of the design motif is also a major obstacle that makes the craftsmen less interested in implementing E-Commerce. There are four factors that determines the adoption of information technology for batik craftmen, i.e. individual characteristics, technological characteristics, the context of the company and the environmental context.