Comparison of trust sources of an online market-maker in the e-marketplace: Buyers and sellers perspectives

Abstract

While the recent growth of e-marketplaces such as e-auctions and e-knowledge markets seems phenomenal, several studies suggest that most Internet users have serious concerns about trust. Especially in the e-marketplace, buyers routinely engage with individual sellers with whom they have little or no prior interaction, making trust one of the most important issues to address. In this study, we test and analyze trust-building models for buyers and sellers with LISREL using survey data. The results show that the buyer's trust in a market-maker is positively related to the buyer's length of relationship to the market-maker, reputation of the market-maker, and some of the characteristics of the website hosted by the market-maker. For the seller, trust in a market-maker is also positively related to the market-maker's reputation, and also to some of the characteristics of the website. However, for buyers and sellers, there are different website characteristics that relate positively to trust in the market-maker. Nonetheless, there was one common website characteristic that fostered trust on the part of both buyer and seller, and that characteristic was security. From the perspective of the market-maker, we expect that our results will be useful in understanding how buyers' and sellers' trust should be developed for success in the e-marketplace.