How perceived risk affects online buying

Abstract

Abstract Purpose – The purpose of this paper is to suggest a model that reflects the role that web site cognitive and experiential signals, firm reputation, bricks‐and‐mortar experience, and consumer satisfaction play as determinants of trust in the web site, taking into account the moderating effect of consumer‐perceived risk when buying online. Design/methodology/approach – The investigation uses quantitative research methods. Data collected from interviews with 507 Spanish online buyers are analysed through structural equation modelling. Findings – Internet users who buy online more frequently can trust a web site only based on their previous satisfaction, whereas users who perceive more risks need to perceive that the firm has a good reputation and bricks‐and‐mortar experience apart from other signals such the quality of the service. Practical implications – The results show interesting implications for online vendors, who should apply different commercial strategies to potential buyers according to the level of perceived risk. Originality/value – This study empirically considers several signals that electronic retailers send to the market in order to create buyer trust and satisfaction, while most studies on signals have been theoretical and normative or have not contemplated so many signals simultaneously. Besides, this paper has extended knowledge of the process of the generation of customer trust in online contexts for different types of users according to their level of perceived risk.

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