Effects Of Risks On Online Consumers Purchasing Behavior: Are They Risk-Averse Or Risk-Taking?

Abstract

Since the beginning of e-commerce, trustworthiness of commercial web sites has been a constant issue, and, very likely, it will continue to be. When an online shopper cannot trust a web site where he or she intends to make a purchase, the online shopper would perceive a risk of transactional security and a risk of privacy of personal information. In regard to this perceived risk in online transactions, this study is set out to find the change in the level of perceived risk in Business-to-Consumer (B2C) e-commerce and to test whether or not consumers trust a web-centric company at their first visit to the companys web site. Two major findings of this study are that about one third of those surveyed for the study feel an increased risk in B2C online transactions over the previous year, and that absolute majority of them have never or rarely shopped on a web site they are not familiar with. It is further found that even an attractive deal cannot affect the risk-averse behavior of online shopping. From the findings of the study, it is concluded that risk-averse online shopping behavior is a manifestation of increased perceived risk in B2C online transactions.