Economic and social analysis of the adoption of B2B electronic marketplaces: A case study in the Australian beef industry

The factors that affect the adoption of B2B electronic marketplaces as innovations are investigated through a case study of AuctionsPlus, an electronic marketplace in the Australian beef industry. Two theories help to explain the relatively slow adoption of this system. Kambil and van Heck's model of exchange processes offers a primarily economic view at the level of key stakeholder groups. Rogers's diffusion theory gives a more social view, at the level of the individual stakeholder. Key stakeholder groups do not appear to be substantially worse off with AuctionsPlus from an economic exchange process standpoint. Consideration of the social and political dimensions of electronic marketplaces adds further insight. Loss of social capital, the nature of communication channels, time taken to reach critical mass, and the power of one group originally not recognized as a key player (the stock and station agent intermediaries) all appear to be important influences. Based on these factors, testable propositions are developed and discussed, producing a set of critical issues for the design of electronic B2B markets.