The Influence of E-Commerce Adoption on Competitiveness of Micro, Small, and Medium Enterprises (MSMEs): The Mediating Role of Product Innovation among MSMEs in Kendari City
Keywords:
E-Commerce Adoption, Digital Transformation, MSME Competitiveness, Product InnovationAbstract
The rapid development of digital technology has encouraged Micro, Small, and Medium Enterprises (MSMEs) to adopt electronic commerce (e-commerce) as a strategy to improve market access, operational efficiency, and business competitiveness. In Kendari City, the growth of digital platforms has created new opportunities for MSMEs to expand their market reach; however, many business actors still face challenges in utilizing e-commerce effectively, particularly in developing innovative products that can differentiate their businesses from competitors. Therefore, this study aims to analyze the effect of e-commerce adoption on MSME competitiveness through product innovation as a mediating variable among MSMEs in Kendari City. This research uses a quantitative approach with a survey method. The population in this study consists of 1,250 MSMEs in Kendari City that have adopted digital platforms (e-commerce) for marketing and business transactions. The research sample consists of 132 MSME owners. The sampling technique used is purposive sampling, with the criteria that respondents are MSME owners who have utilized e-commerce platforms such as Shopee, Tokopedia, TikTok Shop, Instagram, Facebook Marketplace, or WhatsApp Business for at least one year. Data were collected through questionnaires using a five-point Likert scale and analyzed using Structural Equation Modeling–Partial Least Squares (SEM-PLS). The variables examined in this study include e-commerce adoption as the independent variable, product innovation as the mediating variable, and MSME competitiveness as the dependent variable. The analysis includes validity testing, reliability testing, coefficient of determination (R²), path analysis, and mediation testing. The expected results indicate that e-commerce adoption has a positive and significant effect on product innovation and MSME competitiveness. Furthermore, product innovation is expected to have a positive and significant effect on MSME competitiveness and significantly mediates the relationship between e-commerce adoption and MSME competitiveness. These findings suggest that digital technology adoption alone is insufficient to achieve sustainable competitiveness; MSMEs must also strengthen their innovation capabilities to maximize the benefits of digital transformation. This research contributes to the development of digital entrepreneurship studies and provides practical implications for MSME owners and local governments in designing strategies to improve MSME competitiveness through digital transformation and product innovation in Kendari City.
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This work is licensed under a Creative Commons Attribution 4.0 International License.
