A Study of E-Trust in Online Auctions

ABSTRACT This study attempts to examine the antecedents and outcomes of e-trust in online auctions. Antecedents, technical and social bonds, and outcomes of e-trust were chosen in order to apply the concepts of relationship marketing to electronic commerce and to further develop this conceptual model in the context of online auctions by incorporating these factors into one model. A case has been made that in this conceptual model the concepts of technical and social bonds serve to significantly contribute to word-of-mouse and e-loyalty (behavioral and attitudinal) through e-trust. This study has revealed that technical and social bonds, with the exception of one technical bond (e.g., learning capability), have a significant positive impact on e-trust. E-trust also has a significant positive influence on word-of-mouse and e-loyalty. The implications of this study are that managers need to consider that e-trust, which is an important variable in online transactions. Keywords: E-trust, online auctions, word-of-mouse, relationship marketing, electronic ecommerce 1. Introduction An important effect of the continuing increase in the number of transactions in online auction sites is that web users have become more demanding [Walczak et al. 2006]. The increase in competition and the ease of moving from one web site to another has forced websites to provide better quality service. But, the traditional customer satisfaction paradigm is no longer sufficient, in a strategic sense, if a website hopes to retain its customers. To keep a competitive edge, it would seem that it would be wise for website's to begin to incorporate a relationship-marketing paradigm into their strategies. One of the important factors of relationship marketing is trust. E-trust is considered important in e-commerce by most researchers [Bryant & Colledge 2002, Morrison & Firmstone 2000]. In the relationship marketing paradigm, trust is generally viewed as an important component for a successful relationship. Morgan and Hunt (1994) defined trust as the perception of "confidence in the exchange partner's reliability and integrity". McKnight et al. (2002) defined trust is an interpersonal determinant of behavior that deals with beliefs about the integrity benevolence, ability, and predictability of other people. This study is to apply the existing theoretical construct of trust to e-trust. Trust should be even more important in electronic customer relationship management (e-CRM) than in traditional CRM because of the paucity of rules and customs in regulating e-commerce [Wingreen & Baglione 2005]. In the context of e-commerce, there are literally dozens of definitions of e-trust [McKinght & Chervany 2001, Stewart 2003, Tan & Thoen 2001]. Some interest researchers do specifically define e-trust [Hampton-Sosa & Koufaris 2005, Lin 2007], and others conclude that e-trust as a social complexity-reducing mechanism that leads to a willingness to depend on an e-vendor will fulfill its commitment [Hwang & Kim 2007, Papadopoulou et al. 2001]. These studies are highly applicable to the present research, as they focus on the dimensions of e-trust in a specific field. It is necessary to understand the major factors of this phenomenon that will encourage web users to commit to the "purchase click" once they are online. Perhaps part of the reason for this slow development is that the nature of trust is generally conceived of as having an interpersonal quality that is not readily evident in the types of interactions that occur online, where the provider and customer are not interacting in the same place or even time. Due to the online interaction appears to be more of a mechanical interaction rather than one that is interpersonal, this study is more interested in mechanical trust than advancement in interpersonal interaction behind web portals designed to give trust in websites. Yet the issue of e-trust in online interactions is important because this business context has done nothing but expand in recent years. …