The Effect of Perceived Security on Consumers’ Intent to Use: Satisfaction and Loyalty to M-Commerce in China

Introduction

In recent years, E-commerce has given rise to m-commerce, a specialized subset, with rapid growth in both industrialized and industrializing nations. Although there are similarities between E-commerce and m-commerce applications, m-commerce can provide additional functionalities and convenience to consumers. The growth in use of mobile devices as well as new developments in radio frequency identification and wireless sensor networks result in more devices being interconnected, tracked, and even made intelligent (Hamad, Smalov, & James, 2009). At the same time, this growth also presents additional potential risks; among those risks, security stands out as one of the most important areas to which m-commerce organizations need pay attention (Turban, King, Lee, Liang, & Turban, 2010).

Organizations that are able to meet consumers’ needs and expectations will increase their customers’ satisfaction, loyalty and retention (Yeung, Shim, & Lai, 2003). M-commerce has transformed mobile phones from simple voice-communication devices into means of advanced-communication up until recently only found in the imagination of science fiction; they now provide voice, text, and video messaging, web surfing, digital imaging, entertainment, payment, banking financial trading, and shopping (Mao, Srite, Thatcher, & Yaprak, 2004). However, this technological revolution impacts users’ adoption of this multitude of increased abilities. Therefore, to enhance the functionality of the advanced technology usage in m-commerce, organizations need to have an in-depth understanding of consumers’ perception and behavior (Dai & Palvia, 2008). Consumer acceptance of the technology is influenced by how consumers view the importance of security and their assessment of sacrifice of the security against the benefits from the use of the technology (Hossain & Prybutok, 2008). How consumers perceive the security measures in place in m-commerce applications could potentially impact their behavioral intentions. The lower the perceived risk from security issues using m-commerce, the more likely consumers will adopted the M-commerce services (Islam, Khan, Ramayah, & Hossain, 2011). There is reason to believe that increases in consumer satisfaction could improve profitability (Hallowell, 1996). Therefore, it is important to study the effect of perceived M-commerce security on consumers’ behavior vis-à-vis intent to use, satisfaction and loyalty.

Cultural aspects can influence the ways in which web applications are used within a country (Zakaria, Stanton, & Sarkar-Barney, 2003). As rapid growth of m-commerce applications takes place globally, culture can have a stronger effect on the ways m-commerce is used in different countries (I. Lee, Choi, Kim, Hong, & Tam, 2004). China has become the number one country in the world for mobile subscribers (ITU, 2013), and leads in mobile service consumer loyalty and data revenues (mobiThinking, 2013). It is important and interesting to study consumer behavior in China, which has become one of the largest M-commerce markets.

Therefore, the objective of this study is to investigate the relationship between consumers’ perceived m-commerce security and their behavior regarding the intent to use, satisfaction and loyalty to m-commerce in China.