Trust in E-Commerce: Social Networks vs. Institutional Credibility

Trust in E-Commerce: Social Networks vs. Institutional Credibility

Fahri Unsal (Ithaca College, USA), Kurt Komaromi (Ithaca College, USA) and G. Scott Erickson (Ithaca College, USA)
Copyright: © 2011 |Pages: 12
DOI: 10.4018/jea.2011100101
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Abstract

E-Commerce’s virtuality poses questions concerning trust between buyer and seller. Web 2.0 formats have provided new complications for these questions. Companies are creating more social networking sites, experimenting with ways to use such networks for marketing purposes. This paper explores the issue of trust in social networking site transactions vs. those at more established e-commerce sites. The authors apply the Technology Acceptance Model (TAM) to assess the level of trust in different types of e-commerce sites. TAM measures trust along several dimensions and includes potential explanatory factors, such as ease of use, perceived usefulness, search and research capabilities, security, value of product recommendations, and value of customer reviews. The authors directed the respondents to assess amazon.com, Facebook, and eBay—sites with different levels of institutional credibility and social networking affiliations. The data suggest definite differences exist between the sites, perhaps explained by institutional credibility and social networking.
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2. Literature Review

The notion of trust had a long history before the business and marketing disciplines got a hold of it. This literature review will give a nod to that lengthy tradition but, in the interests of space, will focus more specifically on marketing, e-commerce, and technology acceptance. All have derived from the wider conceptualization.

The bulk of the theory concerning trust in marketing applications came out of sociology (Gambetta, 1988). At its base are concepts such as its interactivity based on relationships, expectations, behavior of others, symbiosis, and exchange as well as the idea that trust becomes apparent in actions over time (Garfinkel, 1963). Relatedly, individuals then develop trust-based routines as they assess an ongoing relationship (Giddens, 1991). And, on a more immediate level, the particular environment, including situation and circumstances within which trust can form, is also critical (Baier, 1986).

Many of these concepts clearly apply to business situations as interactivity and exchange are at the basis of internal and external transactions. And businesses gain trust through routines, repeated transactions, and environmental cues. But more specifically, the research in trust related to business has focused more on rationality and how individuals and organizations perceive and assess their own self-interest, acting according to those calculations (Coleman, 1990). Drawing from economics, the benefit from reducing transactions costs and establishing closer relationships through trust can be weighed against the potential costs of opportunistic behavior by the opposite party. When trust is confirmed through expected performance, such cooperation leads to increased efficiency (Axelrod, 1990).

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