E-commerce adoption hinges on perceived benefits, not ease of use, among SMEs

A newly published research paper titled “Unlocking e-commerce potential in SMEs: an integrative framework for adoption in emerging markets” in Humanities and Social Sciences Communications offers critical insights into the dynamics shaping e-commerce adoption by small and medium-sized enterprises (SMEs) in Indonesia and Malaysia.

Conducted by researchers from Warmadewa University and Universiti Teknologi MARA, the study presents a robust analytical model integrating three influential frameworks, Technology-Organization-Environment (TOE), Innovation Resistance Theory (IRT), and the Unified Theory of Acceptance and Use of Technology (UTAUT), to examine both the drivers and deterrents of digital transformation among SMEs.

What factors drive SMEs toward e-commerce?

The study finds that the strongest positive influences on SMEs’ intention to adopt e-commerce come from performance expectancy, organizational readiness, and facilitating conditions. These factors collectively reflect an SME’s belief in improved performance through digital channels, internal capability to support such transformation, and access to necessary resources and support systems.

Performance expectancy emerged as a powerful motivator. Many SME owners and managers perceive e-commerce as a tool to enhance business growth, marketing effectiveness, and profitability. Facilitating conditions, such as internet access, financial capital, and external support, play a similarly crucial role. These micro-level operational enablers help businesses overcome practical barriers to implementation.

Organizational readiness, representing the macro-level capacity of SMEs, further amplifies this intent. SMEs with leadership support, employee readiness, and strategic openness to digital transformation are far more likely to transition to e-commerce. Importantly, the study distinguishes organizational readiness from facilitating conditions, underscoring that systemic capability and strategic vision must accompany operational support to drive successful adoption.

What barriers are holding SMEs back?

Despite high adoption intentions, several psychological and practical resistance factors persist. The study identified value barriers as the most substantial deterrent to e-commerce uptake, even surpassing concerns over complexity or tradition. Many SMEs believe that the investment in e-commerce systems, including time, training, and costs, may not yield sufficient returns, making them reluctant to pursue digital transformation without clear, tangible benefits.

Risk barriers, though less influential, still play a notable role. Concerns over data privacy, cybersecurity, and financial loss continue to weigh on decision-making, especially for resource-constrained businesses lacking robust digital safeguards. Image barriers, tied to brand identity and perceived consumer expectations, also showed a marginal yet significant effect, particularly among SMEs fearing misalignment between their traditional image and online commerce.

Interestingly, traditional barriers, which involve resistance to changing long-standing business practices, were statistically insignificant in this context. This suggests a cultural shift among SMEs in Indonesia and Malaysia, where digital commerce is increasingly viewed as a business necessity rather than a disruption to heritage practices.

How do these findings inform future strategies for SME digital transformation?

The integrated model proposed by the researchers explains nearly 90% of the variance in SMEs’ adoption intentions, an exceptionally high predictive strength in behavioral research. This comprehensive approach reveals that no single factor is sufficient to trigger widespread digital transformation; instead, a multifaceted strategy addressing behavioral, organizational, and systemic barriers is essential.

For policymakers, the study recommends targeted financial support, streamlined regulatory frameworks, and widespread training programs to bolster both perceived and actual value of e-commerce. Expanding internet infrastructure and providing cybersecurity assurances can further mitigate risk perceptions.

E-commerce platform providers are urged to simplify onboarding processes and offer flexible, affordable pricing models. Demonstrating clear return on investment and providing hands-on support are seen as crucial steps in reducing usage and value barriers. For example, tiered subscription plans, seller tutorials, and enhanced fraud protection can significantly improve platform attractiveness to SMEs.

At the enterprise level, SME leaders must proactively invest in building internal digital capabilities. This includes upskilling employees, hiring digital talent, and aligning business models with consumer expectations in an increasingly online marketplace. The study also highlights sector-specific strategies, such as visual storytelling for fashion brands or virtual try-ons for cosmetic retailers, as essential tools for driving sectoral adoption.

The research stresses that environmental pressures like customer demand or competitor success, while relevant, are not sufficient on their own to push adoption. SMEs ultimately prioritize internal readiness and the perceived business value of e-commerce, making it critical for support ecosystems to align accordingly.