Digital standardization vs. adaptation: Mitigating the liability of outsidership – A literature review

Traditionally, firms expanding internationally must decide on when to modify their business model by either standardizing or adapting their products, price, promotion, and distribution activities to overcome the liability of foreignness (LOF). However, firms that pursue internationalization through internet-based digital ventures—such as websites, mobile applications, social media, and online platforms—encounter distinct entry barriers that give rise to a liability of outsidership (LOO). We contribute to this literature by proposing a conceptual framework and theoretical perspective that explains how the degree of business model standardization or adaptation can influence the extent to which firms can reduce both LOF and LOO in digital internationalization. We then conduct a systematic literature review of existing research on digital standardization and adaptation, highlighting current findings and identifying key gaps in the field. Our review of 49 relevant studies reveals that much of the existing research is fragmented, often lacks a unifying theoretical foundation, and primarily focuses on website and promotional adaptation, largely neglecting other critical business model components and the broader set of digital-specific entry barriers. Drawing on our theory and literature review we develop recommendations to guide future research and advance our understanding of this important issue.