Building a customer base in the electronic marketplace: an empirical exploration of the e‐tailing industry

Purpose – Building a customer base as an outcome of customer satisfaction has not been investigated empirically in e‐tailing industry. This paper seeks to fill this gap in the literature. Design/methodology/approach – Explores the relationship between satisfying customers and building a customer base using data envelopment analysis (DEA). Data from the e‐retailing industry related to the input variables (e.g. customers' ratings on a set of e‐store attributes) and output variables (e.g. a proxy measure of “customer base”) are analyzed. Findings – Performance scores for developing a customer base vary across product categories. Performance score is a good parameter for predicting future change on a unique number of visitors and on the competition pattern for a particular e‐tailer. Research limitations/implications – Further study can examine other drivers of a developing customer base (e.g. advertising, trust building, and strategic alliance) – thereby producing more robust evidence for customer base development in e‐tailing industry. Practical implications – Good practices in the generation of customers and page view have been identified. Knowing the efficiency patterns of an e‐tailer makes it possible to guide managerial action by providing a measure of the extent to which different management actions at the e‐tailer can lead to higher future customer growth. Managers should realize that customers match realizations and expectations of product/service performance. Originality/value – This study has identified satisfaction as the important driver of developing a customer base. It focuses on improving diagnosis of the performance of e‐tailers by assessing reach efficiency and page view efficiency separately.