Servitization, digitization and supply chain interdependency

Research output: Contribution to journalArticlepeer-review

Authors

Colleges, School and Institutes

External organisations

  • University of Reading
  • Univ Granada
  • University of The West of England (UWE)

Abstract

This study draws on literature at the intersection of servitization, digital business models and supply chain management. Work empirically explores how digital disruption has affected Business-to-Business (B2B) interdependencies. Dematerialization of physical products is transforming the way firms are positioned in the supply chain due to a reduction in production and transport costs and the different ways business engage with customers. Specifically, we propose that these new market conditions can empower downstream firms. We further propose that upstream firms can still capture additional value through digital service if their servitized offer includes difficult to imitate elements. The context of the analysis is the publishing industry. The Payment Card method employed is used to test UK and US consumer's perceptions of digital formats (eBooks) and assess their willingness to pay in relation to printed formats. The method undertaken enables us to elicit aggregated consumer demand for eBooks which in turn identifies optimal pricing strategies for the digital services. Analysis demonstrates that during digital servitization upstream firms should seek to deploy unique resources to ensure their strategic position in the supply chain is not diminished.

Details

Original languageEnglish
Pages (from-to)69-81
Number of pages13
JournalIndustrial Marketing Management
Volume60
Early online date30 Jun 2016
Publication statusPublished - Jan 2017

Keywords

  • Servitization, Payment card, Publishing industry, Interdependences, Digitization