The Effect of E-Commerce Capabilities on Firm Performance: An Empirical Study in Indonesia

The creative industry is also impacted by volatile economic and business conditions; many entrepreneurs using E-commerce as one of their business channels. Companies adaptation rate may depend on their capabilities, such as innovation capabilities and dynamic capabilities. Indonesia has various cultures and a vast geographic area, which make creative industry in Indonesia develop their own unique traits and features. Unique characteristics of creative industry and its relationship with their capabilities and E-commerce performance have yet been explored. In this paper, we discuss the phenomenon and produce findings related with direct and indirect impact between E-commerce capabilities, innovation capabilities, and creative firm E-commerce performance. Quantitative approach with cluster random sampling towards 383 entrepreneurs and business owners were used in this paper. Empirical result from this study has shown that creative firm E-commerce performance was significantly influenced through indirect relationship E-commerce capabilities and innovation capabilities. On the other hand, direct relationship result between E-commerce capabilities toward creative firm E-commerce performance was insignificant. This result means that innovation capabilities play an essential role as decent mediator and catalyst in order to enhance E-commerce capabilities impact for achieving superior firm performance in terms of creative industry, which may be used as guidelines for entrepreneurs and business owners.