Channel Extension Strategies: The Crucial Roles of Internal Capabilities and Customer Lock-In

This study addresses the important but yet unresolved question of how firms can create com-petitive advantage from their multichannel marketing strategy. More specifically, the authors investigate the antecedents of channel extension strategies and their performance implications. Results from an empirical study including top managers from 308 firms indicate that in addi-tion to environmental factors, a firm's channel expansion is directly related to its strategic channel management capability, and that this capability is more important in turbulent envi-ronments. Furthermore the study reveals that firms need an appropriate customer lock-in strategy to benefit from the addition of novel channel types or traditional channel expansion.