Sources and dynamics of trust in the e-marketplace

Abstract

The e-marketplace, or broker-managed online market, is one of today``s most profitable e-business models. While the growth of e-marketplaces such as e-auctions and e-knowledge markets seems phenomenal recently, several studies suggest that most Internet users have serious concerns on trust. Therefore, building customer``s trust is the big challenge to continuous growth of the e-marketplace. Especially, in the e-marketplace, buyers routinely engage with businesses and individual sellers with whom they have little or no prior interaction, making trust one of the most important issues to address. There are three players in the e-marketplace: market-maker, buyer, and seller. From the perspective of a market-maker, understanding how buyers`` and sellers`` trust are formed is important for the success in the e-marketplace. Therefore, a clear understanding of the trust building process in the e-marketplace is important for the success in the market. In the first study, we develop a trust-building model for buyers and sellers, respectively. Through the analysis of the model, we identify the sources of trust in a market-maker. In doing so, we assess the buyer``s and seller``s trust models in the e-marketplace and discusses the common and different aspect of the two perspectives. The research model presented here was tested on survey data collected from 701 buyers and 668 sellers in the e-marketplace. The results indicate that buyer``s trust in a market-maker is stemmed from the characteristics of a market-maker and website as well as customer``s experience. However, for the seller, only the characteristics of both a market-maker and a website are positively associated with the trust in a market-maker. In the second study, we analyze the process which e-marketplace customers develop trust in both a market-maker and sellers. We expect that this analysis provides a theoretical framework to identify the antecedents of trust. In this model, we suggest that the impact of trus...