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The purpose of this paper is to use the Black-Scholes-Merton option pricing model to evaluate the incremental performance of an eChannel addition.

Data were collected from 53 Taiwan financial services firms. In total, 33 of them introduced their online services, whereas the other 20 firms did not introduce their online services during the period under examination.

The research findings show that firm asset values increase following eChannel additions. Thus, eChannel additions enhance firm financial performance. A further analysis comparing the performance between firms with and without eChannel additions also shows that firms with eChannel additions have higher asset value growth rates, which further validates the capacity of eChannel additions to enhance financial performance.

Managers and shareholders in firms making eChannel additions are not required to be concerned regarding stock price volatility, and managers in firms without any eChannel investment could use eChannels to enhance their stock price and seize future opportunities. Using eChannel is a valid approach for firms to provide enhanced services to current customers, access new markets, and extend market coverage, thus enhancing overall financial performance. Investors could confide those firms implementing eChannel additions.

Studies investigating whether eChannel additions enhance firm financial performance are scant. No study has evaluated performance from a long-term perspective or from a volatility aspect (both are important considerations in eChannel performance evaluation). The research represents a pioneering work that empirically investigates these issues.

The article is a summarised version of a prospective study for the Swiss tourism region of Valais by the Institute for Public Management and Tourism (ITD) of the University of St. Gallen which has been achieved in April 2000. The Transformation Model has served as theoretical background. The Swiss Ski area industry was for a long time a driver of the tourism development in the Alpine regions. The transformation of this sector has a direct impact on the transformation of destinations and other sectors. The necessary changes, the business models and the problems of financing investments explain the transformation process. The analysis is based on two major scenarios. If the status quo — scenario is followed, it would not be possible to change the structures. In this case, the public sector has to support the sector with payments of about 1,5 billions of sfr for the next decade. In the other case of a more managed development, the strategies and the structure of the sector's enterprises have to guarantee a sustainable development. The authors are in favour of a vertical integration of a destination which can create economies of scope rather than for a horizontal integration and economies of scale.