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Ecommerce and Consumer Trust


Imagine going into a bricks-and-mortar bookshop. ... and probably been added to the bookshops prolific mailing list you begin to ... – PowerPoint PPT presentation

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Title: Ecommerce and Consumer Trust

E-commerce and Consumer Trust
  • Problems with Engagement and Some Potential

Jason Rutter ESRC Centre for Research on
Innovation Competition University of
  • The numbers bit.
  • Why should we trust the internet?
  • What is trust anyway?
  • OK, so what does that mean for users?
  • So any good news?

Number of Online Shoppers
BaseAll e-shoppers (c.600 per wave)
Source BMRB Internet Monitor
E-Commerce spend forecast for 2008
Billions of Euros
Source Jupiter Research 2003
Who shops online?
  • 74 of active UK internet users bought products
    online in in last 6 months
  • 47 have a household income between 25k and
  • 41 are aged between 18 and 35.
  • 46 have been online for over 5 years.
  • 38 have shopped online more than ten times in
    the past six months.
  • The proportion of online buyers with less than
    two years experience is under 10.

Most research explores
  • Trust and ecommerce engagement
  • Building trust for legitimate sites
  • Assumes trust is a good thing.
  • …but are there broader issues?

Reasons for NOT Trusting E-commerce
  • Scam Spam
  • Identity Theft (Phishing/Page-jacking)
  • Advertising creating distrust

Spam and Scam
  • 23 of UK internet users received obscene or
    abusive emails
  • 18 received a virus
  • 17 had been sent a get-rich-quick email
  • Counterfeit software pharmaceuticals

Source Oxford Internet Institute (Hutton
Shepherd, 2004)
Unique New Unsolicited E-mail Messages
Source Commtouch Software Online Lab
The Advertising Paradox
  • Credit card companies stand to gain from
    increased ecommerce…
  • …but also use safety fears to develop USPs

Capital One
  • The level of security websites can offer for
    online transactions is still very important to
    online shoppers.
  • 66 of them rate level of security as a very
    important factor when choosing a website to buy
  • Concern over security is also the top reason
    given for not having bought a product over the
    internet (cited by 25)
  • 72 of users believe using credit card online is

Source BMRBs Internet Monitor
Agreement that Credit card use on internet is
very or fairly secure
BaseAll GB Internet Users Aged 15 (c 1,000
per wave)
Source BMRBs Internet Monitor
Definitions of Trust include…
  • Management of
  • Expectations
  • Information
  • Knowledge
  • Risk/vulnerability
  • Potential benefit
  • Uncertainty
  • Complexity
  • Lack of control
  • Asymmetries of disclosure
  • In order to make decisions about possible

What Is Trust?
  • Garfinkels experiments in trust
  • Trust is manifest in the actions of individuals
  • That we judge how to act based upon the trust we
    have in others
  • Trust is used to the benefit of both parties
    involved in an action
  • Where trust is offered is it generally expected
    in return
  • That trust is offered based upon expectancies
    of others behaviour
  • That trust is used to define ones relationship
    to others

Trust in Interaction
  • Everyday routines Goffman, Blumer, etc
  • We show we arealive to the situation
  • Routines/rules are
  • tacit or taken-for-granted qualities which
    form the essential condition which allows actors
    to concentrate on tasks in hand. (Giddens, 1991
  • Mutuality ? Garfinkels experiments

The E-C Breakdown in Mutuality
  • E-commerce is more like typing than shopping.

An Experiment…
  • Imagine going into a bricks-and-mortar bookshop.
    As you walk through the door you are met by a
    insistent member of staff who asks you for your
    name, address and daytime phone number and
    refuses you entry into the store before you
    provide those details. No ifs, no buts, no, Im
    only looking, the rule is absolute no personal
    details, no entry. Having had these details
    recorded and probably been added to the bookshops
    prolific mailing list you begin to wander around
    the store. However, you soon begin to notice
    that you are being followed around the store by
    what appears to be a store detective. This
    person watches everything you look at, notes down
    how long you look at it, whether you put it in a
    shopping basket and even tries to take a peak at
    our other shopping bag in an attempt to find out
    what store wed just come from. You put up with
    this strange behaviour and eventually find a book
    you are interested in buying. This,
    unfortunately, has not been as easy as you
    thought as although the shop has an excellent
    stock, only the top selling books are easily
    found and others available not by browsing the
    shelf but by asking an assistant to bring you a
    list of all the books they can sell you (both in
    stock and available on order) that have a
    particular keyword in the title. While you are
    waiting for the list you are encouraged to take a
    look at a number of advertisements for this
    bookshop and other companies. The only snag now
    is that there is no price on the item you want to
    buy. You again return to the assistant who is
    more than happy to help you but only if you
    provide the company with your credit card details
    for their records first. However, the assistant
    assures you that once they have your details on
    file then shopping with them will be a lot
    simpler and quicker and that, in order to further
    tailor your shopping needs, would you mind
    completing this short questionnaire about you
    interests, income, shopping routine and details
    of why you chose this particular bookshop?

Key Trust Factors
  • Experience of using the Internet
  • Higher level of formal education
  • Both these strongly linked to socio-economic
  • Not correlated with merely being more trusting.

Trust Issues
  • Users cannot distinguish between real and
    deceptive sites
  • Priming increases perception of deception not
  • User evaluation of trust signs (seals,
    warranties, location, etc.) is key rather than
    the signs themselves

Source Grazioli, 2004
A Graphical Model
Increasing tolerance
Regulation most important
Successful interaction
Mutuality low potential for mistrust high
Easy to jeopardise relationship
Ways to Foster Trust?
  • Addressing the asymmetries
  • Brand identity
  • Social presence
  • Trust services

Addressing Asymmetries of Disclosure
  • Risk appears greater to user than retailer
  • Clear warranty and returns policy
  • Upfront info on postage costs, delivery times,
    stock, etc.
  • About us - inc. address
  • Highlighting of bricks-and-click organisation

Brand Identity
  • As trust is fostered through relationship
    ecommerce users favour familiar brands
  • More users visiting less sites
  • Perceived reputation correlated with willingness
    to trust (Jarvenpaa et al., Ruyter, etc.)
  • Trust positively linked to purchase intention
    (Gefen Straub)
  • Trust in institution not linked to adoption of
    ecommerce (Kim Prabhaker)

Social Presence
  • Product reviews
  • Independent reviews
  • Adds value to products
  • Increases stickiness
  • Little cost to retailer
  • Kudos cultural capital of membership
  • Sustained advertising and awareness campaigns
  • Personal narratives have profound importance to
    development of trust … no matter how

Trust Services
  • Safety nets are the product of distrust
  • Why trust trust services?
  • Still reliant of relationships
  • Where trust exists trust, services re-establish
    mutuality we know how business is to be done
  • Like being introduced to a friend of a friend

  • E-trust no different from trust
  • Trust is local and negotiated
  • Based around relationship and personal experience
  • Trust is a cyclic process
  • community depends on trust, and trust in turn
    is culturally determined (Fukuyama 1995)
  • Still a need to explore using social science
  • Still a need to explore in practice

E-commerce and Consumer Trust
  • Problems with Engagement and Some Potential

Jason Rutter ESRC Centre for Research on
Innovation Competition University of