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trust
and performance
Online
and offline, consumers seek clues to assess whether a
retailer, government agency or individual is credible.
They also judge on the basis of performance.
That's not
new, as evident from from accounts in Paco Underhill's
entertaining Why We Buy (London, Orion 99) and Perceived Quality: How Consumers View Stores &
Merchandise (Lexington, Lexington Books 85) edited by
Jacob Jacoby & Jerry Olsonn. As we've noted in the
reputation page of our
marketing guide, many are using the web to express their
opinion of that performance.
This page highlights some of the studies of how consumers
assess sites and online services. It is an introduction to
questions explored more fully in separate guides on privacy,
security, marketing
and the new economy.
Despite claims by some pundits, consumer behaviour online
is not monolithic. Although the web is becoming
mainstream, it's not surprising that different groups have
different expectations and seek different cues. That's a
challenge if you're offering goods and services online, as
the market segments you want to capture may be among the
more savvy.
They're also likely to comparison shop, judging your
services or information against overseas benchmarks that
are just a mouse-click away. Such benchmarking is becoming
an issue as Australian markets ask why local retailers,
for example, do not match the privacy and feedback
policies of overseas competitors. At Caslon we've been
underwhelmed by the lack of response to queries addressed
to webmasters on several major Commonwealth government
sites: there seems little point of including an email link
if the mail is not checked.
trust
Two starting points for considering the nature of
trust in cyberspace are the detailed 1999
report
from the US National Academy of Sciences
on Trust In Cyberspace and the Informed Consent
Online project (ICO)
at Washington University.
Among literature discussed elsewhere on this site we've
pointed to Trust
& Risk In Internet Commerce
(Cambridge, MIT Press
00) by L Jean Camp and Bruce Schneier's
excellent Secrets & Lies: Digital Security In A
Networked World (New York, Wiley 00).
There's a more technical approach in Joseph Reagle's 1996 thesis
on Trust in a Cryptographic Economy & Digital
Security Deposits: Protocols and Policies.
It's of particular interest given Reagle's subsequent
work with Cranor and others on consumer responses to
privacy policies and H Jeff Smith's Managing Privacy: Information
Technology & Corporate America (Chapel Hill, Uni of
North Carolina Press 95), for which as yet there's no
equivalent. Schneier's more nuanced than Gail Grant's Understanding Digital Signatures:
Establishing Trust over the Internet & Other Networks (New
York, McGraw-Hill 99).
For those seeking a mathematical
approach we recommend Sandeep Krishnamurthy's 2001 paper
An Empirical Study of the Causal Antecedents of
Customer Confidence in E-Tailers.
comparison shopping
In the late 1990s some advocates hailed the development of
shop bots as a tool for getting the best price by
searching across numerous sites. We were more reserved,
since great pricing is one thing, actual delivery (and if
appropriate return) quite another. Others advocated rating
systems, of varying complexity, so that consumers could
advise each other independent of a vendor's advertising or
a self-awarded seal.
In practice the performance of such schemes has proved to
be quite problematical. There have been claims that
particular retailers cook the books in a digital version
of payola. Others have used software or litigation to
prevent bots trawling their site. Others, such as Amazon,
rely increasingly on dynamic pricing - potentially a
different figure for every visitor.
Chris Dellarocas' 2000 paper (PDF)
Immunizing
online reputation reporting systems against unfair ratings
and discriminatory behavior and the paper
by Erik Brynjolfsson on The
Great Equalizer? Consumer Choice at Internet Shopbots
are thus of particular interest.
Jakob Nielsen's 1998 Alertbox
on Reputation Management is an excellent
introduction to issues raised by the growing number of
'opinion' sites, such as the US Epinions
and UK DooYoo
- web databases of complaints about hundreds
of products and services with authors receiving a royalty each time a published complaint is
accessed.
Complaints portal Ecomplaints
perhaps unsurprisingly has had limited success as a venue for consumers
to publicly swap messages with corporate targets. Planetfeedback,
a site identifying the executives of all major US
corporations, appears to enjoy greater popularity.
buying online
In the economy guide we've pointed to studies of what
people buy on the web, who's buying and why they're their.
Interpreting that information is a challenge, as there is
a significant regional variation within markets such as
the US and between markets such as the UK and
Australia.
One example is the report
by the London Business School on Business to
Consumer eCommerce: an Investigation of Factors
Related to Consumer Adoption o f the Internet as a
Purchase Channel.
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