CHIMERA WORKING PAPER NUMBER: 2006-10
Online auctions: User experience insights




Online Auctions: User Experience Insig...
Chimera
The work reported in this paper is part of the scientific programme of Chimera, the Institute for
Socio-technical ...
For an on-line version of this working paper and others in the series go to:
www.essex.ac.uk/chimera/publications.html

© ...
Table of Contents
1     Making e-commerce sites matter to people ............................................................
4.3      eBay & affective experience.........................................................................................
1    Making e-commerce sites matter to people

The overall success of an e-commerce website, and how it matters to people,...
points, most purchasers have only seen a picture (or two) as part of the item description and, as
traditional auction hous...
Certain issues should ultimately ‘matter’ to academics because they ‘matter’ to their research
participants. And while som...
With ‘virtual dust’ threatening to shower down on the heads of every new e-commerce site that
sets up shop, as Marshall’s ...
likely to result in transactions, which ultimately results in revenue for eBay through listing and
selling fees.

2.1     ...
Figure 1: eBay overtakes Amazon in UK, in terms of growth and absolute numbers

                                          ...
•   eBay.co.uk accounts for 10% of all the time UK users spend on the Internet
           (Nielsen/Netratings, April 2005)...
guidelines, which has a negative affect on their business and, relatedly, the chance of their
survival in the competitive ...
constituent drawn to it for this very reason, eBay affords a constant turnover of new, fresh stock,
based on possible auct...
Essentially, eBay aims towards stickiness not just through its listings, but through additional
features such as its commu...
Figure 2: Homepage Advert for a forthcoming 5p listing day (eBay.co.uk, 2006).



Additionally, eBay occasionally sends ou...
different subscribers based on their interests and purchase history - buyers choose which mailing
lists they belong to whe...
Those who, even though aware of eBay, refuse to visit the site
         •    eBay-curious
              Those who have hea...
frequent ‘lurker’, to being a once, twice, and then a regular, active eBay customer, depends on
their ongoing customer exp...
Thus, even once that ‘initial hurdle’ has been overcome, negative experiences may prevent a
customer (buyer or seller) fro...
Further to the effects of usability, previously discussed, “research has shown that Internet
shoppers use caution when pur...
3     Trust, Mistrust & Risk

Overall, it can be said that trust is essential in any relationship, not just those played o...
alternative behaviours that could lead to negative consequences for the person. The degree
               of trust can be ...
previous experience and trust propensity, which are clearly subjective. Accordingly, as our degree
of trust in these mecha...
be more visible and noticeable than positive (‘trust-building’) events, and they also tend to carry
more weight in judgmen...
For example, although one of our respondents ‘started small’ and was only prepared to suffer
relatively insignificant user...
relationship with vendors that you buy off regularly.
         (Gerard, stamp and cover collector)

However, even though r...
1. Cases where the information problem arises before the parties agreed to transact, ex ante
         (the hidden informat...
you’ve never seen, and would you buy an object with your money that you’ve never seen and never
         held and never lo...
Group, M4). For more collectable items, the information supplied is key. However, many
elements of information important t...
•    Intermediary trust – a buyer’s belief that the intermediary would protect them,
         provide a secure and stable ...
Trust in eBay as an Intermediary

When it comes to protecting sensitive personal information in particular, eBay’s trustwo...
reveal that consumer confidence in eBay is waning - eBay are now ranked in fifth place9 losing
out to companies such as Am...
may give your personal information to parties investigating you (such as law enforcement officers
or government officials)...
sinister. If someone wishes to find out another person’s home address on eBay, this can easily be
done by completing a tra...
huge amount of like crap and it was all in ... it all had eBay on it - like five-hundred megabytes of stuff
        and I ...
will ‘dip into’ Egger’s framework, largely consulting his initial two dimensions, presenting related
concepts and extendin...
Online Auctions: User Experience Insights from eBay
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Transcript of "Online Auctions: User Experience Insights from eBay"

  1. 1. CHIMERA WORKING PAPER NUMBER: 2006-10 Online auctions: User experience insights Online Auctions: User Experience Insights from eBay Chimera Working Paper Number: 2006-10, April Haywood, A.J. ahaywo@essex.ac.uk © 2006, University of Essex http://www.essex.ac.uk/chimera/ Page 1 of 198
  2. 2. Chimera The work reported in this paper is part of the scientific programme of Chimera, the Institute for Socio-technical Innovation and Research at the University of Essex. Chimera is a post-disciplinary institute employing social scientists, computer scientists, engineers, anthropologists, psychologists, HCI practitioners and interface designers specialising in ‘socio- technical’ research and consulting. It was set up in April 2002 at Adastral Park, Suffolk as a research institute of the University of Essex. Chimera carries out research which combines the social and technological sciences to: • generate insights into personal and social use of information and communication technologies, • ground technological innovation in an understanding of people, • provide analysis to support evidence-based 'information society' strategies and policies in the public and commercial domain. We achieve this through a balanced programme of basic and applied research projects, consultancy and publication. For more information see www.essex.ac.uk/chimera Contacting Chimera Chimera Tel: +44 (01473) 632238 Institute of Socio-Technical Innovation and Fax: +44 (01473) 614936 Research E-mail: chimera@essex.ac.uk Ross Building (PP1, ROS-IP) Web: http://www.essex.ac.uk/chimera/ Adastral Park, Martlesham Heath, Ipswich, Suffolk, IP5 3RE UK Citing This Paper Readers wishing to cite this paper are asked to use the following form of words: Haywood, A.J. (2006) ‘Online Auctions: User Experience Insights from eBay’, Chimera Working Paper 2006-10, Colchester: University of Essex. © 2006, University of Essex http://www.essex.ac.uk/chimera/ Page 2 of 198
  3. 3. For an on-line version of this working paper and others in the series go to: www.essex.ac.uk/chimera/publications.html © 2006, University of Essex. All rights reserved. No part of this publication may be reproduced, stored in a retrieval system or transmitted, in any form, or by any means, mechanical, photocopying, recording or otherwise, without the prior permission of the Director, Chimera. Acknowledgements I would like to thank the ESRC for their financial support for this report’s fieldwork and writing up. This was funded through RES-000-23-0433 ‘Virtually second-hand: Internet auction sites as spaces of knowledge performance’. © 2006, University of Essex http://www.essex.ac.uk/chimera/ Page 3 of 198
  4. 4. Table of Contents 1 Making e-commerce sites matter to people ......................................................................... 6 2 ‘Stickiness’ ............................................................................................................................ 8 2.1 The Web’s Holy Grail ..............................................................................................................10 2.1.1 The stickiest site on the web ................................................................................................... 10 2.1.2 Good ‘Sticky’ Design................................................................................................................. 12 2.1.3 Sticky Content .......................................................................................................................... 13 2.1.4 Ensure the ‘Basics’ ................................................................................................................... 15 2.1.5 Sticky Marketing....................................................................................................................... 15 2.2 ‘eBayer transformations’ & moments of truth ...........................................................................17 2.3 User Experience .....................................................................................................................20 3 Trust, Mistrust & Risk.......................................................................................................... 22 3.1 Trust Defined.........................................................................................................................22 3.1.1 Trust Thresholds ...................................................................................................................... 23 3.1.2 The Fragility of Trust................................................................................................................ 24 3.2 Trust & Risk...........................................................................................................................26 3.2.1 Information & Risk ................................................................................................................... 27 3.3 Establishing Trust in e-Commerce ...........................................................................................30 3.3.1 Trust in Sellers and Intermediaries .......................................................................................... 30 3.3.2 Moving people towards the ‘active green’................................................................................ 36 3.3.3 Pre-interactional filters ............................................................................................................. 37 3.4 Harnessing the Power of Reputations ......................................................................................44 3.5 eBay as a Trust -based System ...............................................................................................45 3.6 ‘Most People are honest, but….’: Omidyar’s solution.................................................................46 3.6.1 Feedback: The logistics............................................................................................................ 49 3.6.2 Feedback: The reality............................................................................................................... 54 4 Interface properties (& beyond) ......................................................................................... 83 4.1 Branding ...............................................................................................................................84 4.2 eBay & usability .....................................................................................................................93 4.2.1 Towards that ‘difficult first transaction’ & beyond ................................................................... 95 4.2.2 Supporting ‘browsing’ & ‘searching’ ......................................................................................... 99 4.2.3 Example user scenario: accessing eBay’s Safety Centre.......................................................... 99 4.2.4 Filtering Help information & contacting eBay .......................................................................... 99 4.2.5 Keeping eBay ‘abloat’ ............................................................................................................... 99 4.2.6 ‘Closing the Loop’ via Customer Feedback............................................................................... 99 © 2006, University of Essex http://www.essex.ac.uk/chimera/ Page 4 of 198
  5. 5. 4.3 eBay & affective experience....................................................................................................99 4.3.1 eBay as a ‘fun’ experience ....................................................................................................... 99 References ................................................................................................................................. 99 Appendix 1................................................................................................................................. 99 Appendix 2................................................................................................................................. 99 Appendix 3................................................................................................................................. 99 Appendix 4................................................................................................................................. 99 Appendix 5................................................................................................................................. 99 Appendix 6................................................................................................................................. 99 Appendix 7................................................................................................................................. 99 Appendix 8................................................................................................................................. 99 © 2006, University of Essex http://www.essex.ac.uk/chimera/ Page 5 of 198
  6. 6. 1 Making e-commerce sites matter to people The overall success of an e-commerce website, and how it matters to people, will be affected by a number of factors including, for example, “its aesthetic appeal, the nature of its content, how it compares to competitor sites, and how easy the target audience find it to use” (System Concepts, n.d.). Trust is also a vital ingredient for the successful adoption of such sites, as transactions are conducted through the ‘veil’ of the computer medium and this places a unique set of constraints on the buyer-seller relationship, unlike those associated with face-to-face transactions (Nah and Davis, 2002). Free from many of the spatial and temporal boundaries associated with traditional commerce, impersonal, disembedded e-Commerce transactions (Giddens, 1990) afford very different experiences from their offline equivalents (Straub and Gaddy, 2003). For example, with no buildings or staff to evaluate, and no physical items to inspect, consumer decisions rest purely on the pictures and the descriptions provided. Moreover, once a decision to transact has been made, transactions are neither instantaneous nor continuous, which can prove problematic as Straub and Gaddy (2003) state – e.g. critical elements of the sales interaction may be ambiguous, such as postage costs, processes, and avenues for recourse, and there is no post-payment assurance that one’s order will actually be fulfilled. With transactions “stretched over space and time” (Zhou and Liu, 2005: 6) in this way, consumer decisions tend to increase in complexity and the need for trust increases (Giddens, 1990) - trust acts as a mental mechanism that helps reduce complexity, allowing for decision making under uncertainty (Luhman, 1979, cited in Egger, 2003). This report considers a special kind of e-commerce offering – eBay - viewed by some as the ‘killer application’ of the Internet (Urban, 2005). Unlike more traditional e-commerce stores, eBay does not deliver goods - it operates purely as an intermediary through which sellers can post auctions and buyers can bid (Cabral and Hortaçsu, 2005). As such, eBay seemingly presents a perfect e-commerce solution which operates globally, enabling millions of buyers to meet millions of sellers. There is no denying, however, that eBay offers an informationally lean environment in comparison to traditional marketplaces, and this leads to transaction risks such as identity uncertainty (of online trading partners) and product quality uncertainty (Ba and Pavlou, 2002) - transaction partners may never meet face-to-face, and the eBay system dictates that payment typically precedes receipt or even inspection of the goods. As regards the second of these © 2006, University of Essex http://www.essex.ac.uk/chimera/ Page 6 of 198
  7. 7. points, most purchasers have only seen a picture (or two) as part of the item description and, as traditional auction house Sotheby’s vice president C. Hugh Hildesley has observed, “no illustration will give you a precise sense of what an object is really like” (Boyd, 2002). In relation to this issue, which Kollmann (1998; 2001) calls a ‘Quality of Business Deal’ problem, a ‘reality gap’ may be encountered should the item not live up to the expectations created by the description provided. In summary, devoid of the physical presence of an auctioneer orally controlling the auction, overseeing things and ensuring fairness1, people bid for items they (typically) cannot examine or touch, from sellers they may never meet, using a computer system (eBay) that “handles bids, runs a timer, and declares auction winners” (Boyd, 2002). Such interactions, almost by definition, require the essential ingredient of trust. Specifically, as highlighted by Chong et al. (2003), interacting partners need to both trust each other and perceive the mediating system, eBay, as trustworthy – e.g. that you will receive your item, that it will be as described, that your financial details will be kept safe, that prices will be established in a legitimate way, that eBay will help out as an agent of redress if needed. In the e-commerce literature, often trust has been reduced to the problem of security, with the argument that if security issues are resolved, people will happily transact online. However, when the concept of e- commerce trust is investigated in a little more detail, by breaking it down into its constituent parts, other factors (e.g. privacy, ease-of-use, information credibility) are revealed to be just as important to consumers as security (Egger, 2003). Indeed, as argued by Egger and Abrazhevich (2001), “the assessment of security typically happens very late in the trustworthiness evaluation process – namely, just before placing the order”. Trust is a pre-requisite for e-commerce sites to matter to people. If they are not trusted, they will not be used. Indeed, as discussed in our study, non-eBayers were largely reported to not use eBay, either because they didn’t have a computer (or Internet access) or because they had fears concerning trust and security. Once eBay has been trusted enough to start using it and continue using it, it matters to people in a number of different ways. This notion of ‘mattering’ draws strongly on Miller’s (1998) perspective on ‘mattering’ - that issues, things or processes often regarded as ‘trivial’ are often those “‘most effective in social reproduction” (Miller, 1998a: 12). 1 As Boyd states ‘across cultures and times, auctions have taken place under the supervision of an auctioneer whose voice commands attention and maintains order… [on eBay, however,] instead of a single person orally controlling the auction, there is only a website. Instead of a bidder being able to observe competing bidders in the crowd, there are only usernames’. © 2006, University of Essex http://www.essex.ac.uk/chimera/ Page 7 of 198
  8. 8. Certain issues should ultimately ‘matter’ to academics because they ‘matter’ to their research participants. And while some academics may see certain aspects of eBay as ‘trivial’, which may explain the comparative neglect of ‘softer’ aspects in favour testing economic and auction theory (see Wood, 2004 for a literature review of online auction research), eBay clearly ‘matters’ to people using the site in a number of different ways for a number of different reasons. In its investigation of why eBay matters, this report will look at aspects of the eBay user experience in detail, centring largely on experiences closely mediated through the computer medium, rather than more ‘off-eBay’ experiences related to, for example, fulfilment (of the transaction). To do this, in addition to engaging a number of public texts - such as observations from eBay.co.uk, media releases, and literature drawn from across e-commerce, human computer interaction, psychology, and marketing - this document will also draw on user data from our research, derived through focus groups, interviews, questionnaires and experience diaries. Specifically, the report will outline experiences related to trust, and eBay’s Feedback Forum, in particular, before the discussion turns to considerations of usability and eBay as an affective experience. 2 ‘Stickiness’ Since the early days of e-commerce, the ‘one-size-fits-all’ mantra of ‘build a business web presence and they will come’ is no longer regarded as an effective strategy to reach potential customers. Specifically, the exponential growth of the Internet and the diversity of its user population has led to the increasing realisation that, as an inadequate incentive for users, a simple static (in both content and design) web presence will not encourage repeat visits and extended stays. Due to its very nature, the Internet “allows users to quickly skim through websites, easily bypassing sites that fail to engage them, to meet their needs, or to capture their attention” and sites that appear dull, broken or confusing will diminish the user’s experience, encouraging an early departure (Chen and Sockel, 2004: 203). “All over the Net, sites are gathering virtual dust. Some of them cost a fortune; others were created on a budget of zero. Some of them are smart; others are just plain dumb. They’re all different, but they all have one thing in common – they aren’t sticky enough” (Marshall, 2003). © 2006, University of Essex http://www.essex.ac.uk/chimera/ Page 8 of 198
  9. 9. With ‘virtual dust’ threatening to shower down on the heads of every new e-commerce site that sets up shop, as Marshall’s (2003) quote highlights, grabbing a sizable share of the e-commerce market is the ultimate goal. Just as ‘real-world’ stores require repeat business, online equivalents also need customers to return again and again. Essentially, as succinctly put by Marshall (2003), “if a site isn’t sticky2, it isn’t working”, both in monetary terms and for the good of any community associated with the site. Indeed, while repeat business is beneficial financially, if a site is based on the notion of community, then repeat visits have to potential to bolster the ‘community feel’ of the site, a comment that is particularly salient to eBay. Essentially, the Internet buzzword, ‘sticky’, is shorthand for a site that holds the attention of visitors, resulting in longer and more frequent visits. As offered by NetRatings’ analyst Peggy O'Neill (cited in Festa, 1999), “Stickiness is not a measure of efficiency - it's a measure of how engaging you are”. Stickiness can also be related to Gell’s notion of aesthetic traps, as applied to the Internet by Miller (2000). Miller examined 60 commercial and 60 personal websites created by Trinidadians. He characterised these websites as attempts to create aesthetic traps, where the term aesthetic refers not to some notion of beauty, but to the visual characteristics of websites that attempt to draw others into social and/ or commercial exchange, and show the social efficacy of the website’s creators (Miller, 2000). Aesthetics are used to align the creator of the web pages with their audience – web pages are used to signal whether the website producer thinks their audience is ‘appropriate’. Websites are regarded as social agents with social efficacy to entrap the will of others – to catch surfers through a ‘sticky’ visual effect, the creation of enthusiasm or wider involvement. The concept of ‘stickiness’ is not only evidence that, in some ways, a website such as eBay matters to people, but the notion of stickiness, in itself, matters to eBay as a company. To stay abreast of its competition, the eBay site requires more than a professional appearance; it needs to attract and engage users (Chen and Sockel, 2004), as “stickiness = relationships = loyalty = revenues” (Sanchez, n.d.). Indeed, driven by economic incentives, eBay needs to ensure that a maximum number of pages are viewed, as long browsing sessions and repeat trips are more 2 ‘Stickiness’ is usually measured in terms of how much time the average viewer spends on the site in a month (Nemeth-Johannes, n.d.). © 2006, University of Essex http://www.essex.ac.uk/chimera/ Page 9 of 198
  10. 10. likely to result in transactions, which ultimately results in revenue for eBay through listing and selling fees. 2.1 The Web’s Holy Grail As offered by Marshall (2003), “ultimately stickiness is more of an art than a science”. However, despite there being no magic formula that says “add one of these, two of those and a bit of this to make your site sticky” - stickiness isn’t complicated, it just requires paying attention to what your customers want even if they don’t know they want it (Marshall, 2003). Identifying what ‘stickiness’ entails, in terms of defining site-elements designed to encourage visitors to linger longer, is the Holy Grail of Web design (Pappas, 1999). As such, the desire to harness stickiness has fostered a plethora of Google-able articles, which inform that, for example, you must jazz up your site with personalised features, games, news, and ‘fun stuff’. The assumption is that a multitude of ‘add-ons’ will encourage people to initially visit and become engaged once there. However, while adding dynamic and interactive features would seem judicious, in reality, as Marshall (2003) suggests, add-ons that seem pointless and without significance to the site’s intention, may act like oil rather than glue discouraging visitors to stay or even re-visit. 2.1.1 The stickiest site on the web I think it’s successful because it’s a 24/7 online boot sale, with a massive market place, and everybody likes buying and selling. We all do, don’t we? We’re all consumers, and it’s an easy way to get things and get rid of things that you might not otherwise be able to. (Adrienne, Focus Group, M3) At the moment, with eBay being a household name, ‘virtual dust’ is most definitely not a problem. Indeed, one can argue that, while eBay continues to offer the promise of a global marketplace for (largely) consumer-to-consumer and business-to-consumer transactions, with an acceptable degree of ‘user cost’, the success of eBay will continue, ensuring eBay’s sustained status as “one of the major successes of the Internet” (BBC News, 2003). “Internet ratings firm Nielsen NetRatings said eBay's UK site had increased its audience by more than 160% since March 2002 to more than six million people. Over the same period Amazon's UK site saw its audience rise 40% to 5.2 million” (BBC News, 2003) – see figure 1, below. © 2006, University of Essex http://www.essex.ac.uk/chimera/ Page 10 of 198
  11. 11. Figure 1: eBay overtakes Amazon in UK, in terms of growth and absolute numbers (BBC News, 2003). With its familiar logo designed by Tom Walters in mid-1997 (Braun, et al., 2002), eBay is now officially the stickiest site on the web (Wendland, 2000), with reports suggesting that eBay has actually raised the bar for stickiness. Indeed, in terms of pages viewed and time per person on the site, eBay is seen to dominate, even over the likes of Amazon.com: “eBay dominates Amazon.com in terms of pages viewed and time per person on the site… With more than 1.3 billion page views in March and an average of an hour and a half spent on the site, eBay’s stickiness raises the bar for the industry” (ACNielsen, 2001). The following are a number of facts related to eBay’s stickiness, which eBay promote on their site (eBay.co.uk, n.d., a). • eBay.co.uk's audience reached 11.3 million in September 2005 (Nielsen/Netratings, September 2005). • Every third Internet user visits eBay.co.uk at least once a month (Nielsen/Netratings, April 2005). • eBay.co.uk's reach was 43% in September 2005 (Nielsen/Netratings, September 2005, where reach is the percentage of all active internet users within that month visiting eBay.co.uk). • eBay visitors average one hour 54 minutes on the site and view 280 pages per month (Nielsen/Netratings July 2005) • People in the UK - as is true with Germany - spend more time on eBay than any other website (Nielsen/Netratings, April 2005). © 2006, University of Essex http://www.essex.ac.uk/chimera/ Page 11 of 198
  12. 12. • eBay.co.uk accounts for 10% of all the time UK users spend on the Internet (Nielsen/Netratings, April 2005). • People in the UK spend more money on eBay than they spend on going to the movies (Screen International). In terms of more objective measures of its success and expertise, in addition to giving a brief history of its background3 and development, the eBay site does host links to financial information such as its earnings, stock information, annual reports, press releases (e.g. concerning recent acquisitions of Skype and Shopping.com), details on how to invest in eBay inc. (through ShareBuilder), and information on related events. While such information can be accessed through eBay.co.uk, access takes the user to eBay.com (eBay.com, n.d., a). Obviously, from a usability perspective, this could be disorientating, given that any subsequent ‘eBay-activity’ will operate on eBay.com rather than eBay.co.uk – e.g. if users still believe they are consulting eBay’s UK site, the presentation of US-based items following a search, may be confusing. 2.1.2 Good ‘Sticky’ Design Sticky elements can relate to either the design of the site, its actual content, and community aspects. Here, marketing is also important, in terms of attracting new visitors and encouraging return visits. In terms of the site’s actual design, usability4 is particularly important - only when users feel as comfortable as possible, not perplexed at all by their participation, will stickiness ensue. As Nielsen (2001a) reports, e-commerce depends on usability - websites go under because their expenses exceed their revenues, and usability significantly impacts the second of these parameters5. If ease-of-use is not offered and users are prevented from quickly finding the information they want, with the minimum of cognitive overhead, any promise of stickiness is lost – potential customers may give up, thus blighting the chances of a return visit. Nielsen (2001a) suggests that, on average, most websites only comply with (roughly) a third of documented usability 3 Although the story of Omidyar developing eBay to help his partner trade vintage Pez dispensers has been exposed as mere marketing myth, this tale is presented in the company overview provided: “Pierre's fiancée (now wife) was an avid Pez™ (sweet dispenser) collector. She was having trouble finding people to trade with, and Pierre thought eBay might be the answer to her problems” (eBay.co.uk, n.d., a). 4 For readers unfamiliar with the concept, a breakdown of usability criteria is presented in Appendix 1. 5 Nielsen (2001a) adds, that, “with better usability, the average site could increase its current sales by 79% (calculated as the 44% of potential sales relative to the 56% of cases in which users currently succeed)”. © 2006, University of Essex http://www.essex.ac.uk/chimera/ Page 12 of 198
  13. 13. guidelines, which has a negative affect on their business and, relatedly, the chance of their survival in the competitive e-commerce arena. Supporting this, Nielsen’s (2001a) study of Web shoppers highlighted that, of the 496 attempts to perform various tasks on 20 large and small e- commerce sites, only 56% of such attempts were successful. Supporting usability’s position, Nah and Davis (2002: 98) comment that, as Web shoppers become more sophisticated in their knowledge of online purchasing alternatives, “they have become less patient with Web sites that are difficult to understand and use”. Nah and Davis (2002) go on to report that, to a large extent, the Web is required to be a place of ‘instant gratification’. Thus, “a sprawling site that’s stuffed to the gills with rubbish” (Marshall, 2003), will encourage neither repeat visits or the promise of a ‘flow experience’ (Csikszentmihalyi, 19916; Rettie, 2001), where the user feels so totally absorbed in their activity that time doesn’t signify, resulting in their Web-session being prolonged. While it doesn’t necessarily follow that all stickiness is due to flow, one can declare that design elements that encourage flow should also increase stickiness (Rettie, 2001). Usability was not an overt research thread in our current research, and no empirical user testing was conducted. However, it is worth noting that, as indexed by our respondents, eBay is generally regarded as having good basic usability to the point where this is largely ‘taken-for- granted’ by users. The topic of eBay’s usability will be tackled in section ‘4.2 eBay & Usability’. 2.1.3 Sticky Content The look and feel of a website is only part of the ‘stickiness story’, however. Although vital, usability must not triumph over content, as both are essential components of the equation. Sticky content makes the site worth visiting and usability permits this content to be experienced with minimal costs to the user, in terms of, for example: frustration, time, and aborted goals. In order to be sticky, the intention should be towards a site that stands out in some way (Marshall, 2003), with fresh, regularly updated content. As the fore-runner in its field, eBay is obviously not a ‘me-too’ site, which replicates countless others. eBay maintains a monopolistic position in the online auction field. With a global seller 6 Csikszentmihalyi (1991) defined the concept of flow as the holistic experience that people feel when they act with total involvement. © 2006, University of Essex http://www.essex.ac.uk/chimera/ Page 13 of 198
  14. 14. constituent drawn to it for this very reason, eBay affords a constant turnover of new, fresh stock, based on possible auction durations of up to a maximum ten days and, coupled with the sheer diversity of the items offered, this attract buyers: “What started as a place to trade collectables and hard-to-find items has developed into a marketplace where you can find practically anything. From everyday items such as mobile phones, DVDs or DIY to clothing, collectables and even cars. Trading on eBay is easy and fun and you'll never know what you might find” (eBay.co.uk, n.d., b). As acknowledged in the above quote from eBay themselves, although customers were initially drawn to eBay as a place to trade collectables and hard-to-find items, today eBay cannot be regarded as a specialist auction site. Herein lays its attraction as almost a ‘one-stop-shop’; a comparison site for both new and second-hand items, where all tastes can be satisfied. Indeed, people can buy anything from a car to ‘bizarre’ auctions such as a mouldy yoghurt or pile of laundry dust (which were both observed in 2004), all with the promise of bargain prices: R: And what do you all like most about the site, what matters most about the site - in terms of design or features or anything? RC: That you can just put in some bizarre thing that you’re thinking of and there it is. M: I think it’s a really good site because you can use it at different levels, and you’ve got some people selling cars on it and things, and you’ve got other people who just go on, you know, to look around and compare prices with the shops. There seems to be a real mix of people. Not too specialised. MB: It’s just like a lot cheaper, and I like the site - nice design. (Focus Group, M4) Moreover, there is always the possibility that somewhere on eBay, at some time, that ‘elusive item’ will appear; that ‘perfect item’. Such items could turn up at any time: “The thing about the eBay is you don’t know what’s going to turn up - I tend not to buy the regular televisions or radios, or whatever, they tend to be the more unusual bits and pieces” (Oscar, radio collector). Accordingly, while potential bidders perceive the listing of ‘that perfect item’ to not be too remote, they may keep returning to the site, to check. If a visitor’s quest is unfulfilled, then eBay’s homepage can attempt to capture a few more minutes of the user’s time through the provision of, for example, seasonal competitions such as this year’s ‘Great British Stocking Filler’ (eBay.co.uk, 2005), which ultimately aims to encourage members to visit and participate, and new members to register and sign up for a PayPal account. © 2006, University of Essex http://www.essex.ac.uk/chimera/ Page 14 of 198
  15. 15. Essentially, eBay aims towards stickiness not just through its listings, but through additional features such as its community boards and the relatively new addition of ‘eBay Groups’, which allows members who share common interests to create and grow their own community, through participation in discussions, newsletters, polls, calendars, and photo albums. 2.1.4 Ensure the ‘Basics’ As well as meaningful content, the ‘basics’ are also essential for stickiness, especially for casual browsers who may be visiting the site for the first time. Indeed, for the casual browser, “meaningful page titles and search engine-friendly descriptions” will be of particular importance (Marshall, 2003). For all visitors, even experienced visitors who may have established their own shortcuts and ‘work-arounds’, technical problems such as ‘duff’ links and ‘404 errors’, will not create a welcoming experience (Marshall, 2003) and, accordingly, they may discourage repeat visits. 2.1.5 Sticky Marketing The final part of the stickiness equation is marketing. Here, search engine marketing can provide a means to bring in new business, especially if web searchers are looking for specific products through a search engine rather than specific companies. Similarly, ‘e-mail newsletters’ or e-mails detailing special offers/discounts may tempt registered users back for a repeat visit (.netresources.co.uk, n.d.). In order to increase website traffic, announce new products and services, and promote current offering, etc., eBay uses an e-mail marketing strategy. By engaging in this, however, eBay is in competition with other vendor’s e-mail messages, and with the full range of e-mail messages received, in general. For example, eBay is regularly seen to send e-mails to registered members detailing special listing days where listing fees are discounted if certain conditions are met – e.g. 1p listing days for items starting below 99p or 5p listing days. To support these promotional messages, which may suffer due to ‘inbox competition’, details are also advertised on eBay’s homepage in the run up to the event, as figure 2 exemplifies, and users can access information of such promotions via ‘My eBay’. © 2006, University of Essex http://www.essex.ac.uk/chimera/ Page 15 of 198
  16. 16. Figure 2: Homepage Advert for a forthcoming 5p listing day (eBay.co.uk, 2006). Additionally, eBay occasionally sends out coupons (which have an expiry date) to its members, which buyers can use to pay for items that meet the coupon's restrictions, where the seller accepts PayPal as a payment method. To redeem the coupon buyers enter the coupon redemption code when paying (see figure 3), and PayPal then validates the coupon and displays the buyer’s discount. Coupons are automatically converted to regular currency at the time of redemption, so sellers are not aware that a coupon was used to fund the buyer’s payment. Figure 3: PayPal entry field for coupon and voucher codes. To encourage eBay sellers to establish a marketing strategy whilst still operating within eBay’s boundaries, eBay has introduced an e-mail marketing facility, which can be used by sellers with an eBay shop, to promote themselves and foster relationships with members from the wider eBay community. In particular, to encourage new bidders and repeat business (for the seller in question), the scheme allows buyers to sign up to receive e-mails from sellers they have added to their Favourite Sellers list. Sellers can then create up to 5 e-mail mailing lists that target © 2006, University of Essex http://www.essex.ac.uk/chimera/ Page 16 of 198
  17. 17. different subscribers based on their interests and purchase history - buyers choose which mailing lists they belong to when they sign up. 2.2 ‘eBayer transformations’ & moments of truth With more and more people learning about eBay through, for example, word-of-mouth and/or media reports, the ‘eBay-oblivious’ population dwindles. However, the transformation path of the once ‘eBay-oblivious’ doesn’t always end with these individuals being happy, successful eBayers. Indeed, after hearing about eBay, some may people may still choose to ignore the site completely (‘eBay-refuseniks’). Others, although curious, may still resist accessing the site (‘eBay- curious’). Others still, may choose to visit eBay to see for themselves what all the fuss is about; perhaps going on to make purchases or sell, perhaps just making the occasional visit to peruse the items on sale and/or the additional facilities eBay hosts. Indeed, once ‘leaving’ the ‘eBay- oblivious’ community, never to return, a number of transformation possibilities are offered. Although our discussion won’t dwell on this topic, it is appropriate to make the distinctions depicted in figure 4, before continuing our discussion. Figure 4: Nominal categorisation of consumers according to eBay awareness and experience. The figure above serves to crudely categorise people (without attempting to model proportions) according to their ‘eBay awareness and experience’, using the distinctions defined below: • eBay-oblivious Those who aren’t aware of eBay’s existence • eBay-refuseniks © 2006, University of Essex http://www.essex.ac.uk/chimera/ Page 17 of 198
  18. 18. Those who, even though aware of eBay, refuse to visit the site • eBay-curious Those who have heard about eBay, and are tempted to go there, but haven’t as yet • eBay lurkers (non-registered occasional visitors) Those whose curiosity has led them to visit eBay. These people may remain unregistered lurkers, despite many repeated visits, until forced to register in order to bid for an item that tempts them • Active eBayers Those who continue to buy and/or sell on eBay • Dormant eBayers These are registered members who’s participation has waned for what ever reason, or whose active participation has never started (i.e. no transactions have been made since registering). As such, this status can be temporary. • Ex-eBayers Those whose eBay participation has come to an end with their de-registration – either de-registered by choice or been forced to de-register, by eBay, due to a policy violation. For various reasons such individuals may either intend to: • remain unregistered users (as ‘refuseniks’ or perhaps ‘lurkers’); or • may re-register at a later date Continuing our discussion in accordance with the categories defined, it is possible to argue that, once the eBay-curious access eBay’s homepage as the ‘front door’, such visitors are not guaranteed to head straight towards the ‘active green’ (i.e. ‘Active eBayers’). Indeed, they may remain an unregistered ‘eBay-lurker’ until, for example, they discover an item that particularly tempts them and registration is necessitated. “The first transaction is the most difficult” (Brian Burke, eBay, 2003). While those who visit eBay can be regarded to have transformed from ‘eBay-curious’ to being an ‘eBay-lurker’ or ‘newly registered member’, performing one’s first transaction on eBay (as a buyer or seller) can be difficult, as eBay themselves acknowledge. Once over this initial hurdle, however, it doesn’t necessarily follow that it’s all plain sailing from then on. With this in mind, the current authors would argue that getting people to leap from being ‘eBay-curious’ or even a © 2006, University of Essex http://www.essex.ac.uk/chimera/ Page 18 of 198
  19. 19. frequent ‘lurker’, to being a once, twice, and then a regular, active eBay customer, depends on their ongoing customer experience. “Customer experience includes everything that comprises a user’s experience on a Web site. This can include how they feel about the site and the impressions they get from it, whether they can successfully use the site or become frustrated, and the extent to which they encounter technical problems or confusing areas of the site” (TechSmith, 2005: 1). Borrowing words from Customer Relationship Management (CRM), which talks about ‘customer retention’, eBay must continue to work as much at keeping existing customers, as they do to encourage ‘fresh blood’ through the doors and into making that ‘difficult first transaction’ (Seybold, 2001). For existing eBayers, therefore, it is necessary to ensure that they continue to perceive their eBay-experience as valuable (Weinstein and Johnson, 1999 cited in Minocha et al. 2003), as any deviations from this perception may have a serious impact on their level of participation. “Any time a customer comes into contact with any aspect of your business, however remote, that customer has an opportunity to form an impression” (Carlzon, 1986) . As Jan Carlzon (1986) defines, every critical point of customer interaction is a ‘moment of truth’. Moments of truth (hereafter MoTs) are highly influential in terms of whether eBay continues to matter or not, as negative MoTs will operate to mar the customer experience. It is with respect to MoTs that eBay differs from traditional forms of e-commerce, where the term relates to critical interactions between a single business and individual customers, as Carlzon’s quote suggests. On eBay, the potential for ‘moments of truth’ is extremely wide ranging, relating not just to one’s ongoing experiences with eBay itself, but also one’s interactions with buyers and sellers - mediated through eBay as the initial gateway and, potentially, experience of payment mechanisms such as Paypal. Additionally, due to their vital role in fulfilment, postal mechanisms will also play their part. “eBay is offering an experience. The people who go to eBay to bid keep coming back to check on their auctions. It's entertainment” (NetRatings analyst Peggy O'Neill (Festa, 1999). In sum, overall user experiences (including MoTs) will have a dramatic impact on which eBayers stay (and their participation levels) and which ones defect or become dormant or disenchanted. © 2006, University of Essex http://www.essex.ac.uk/chimera/ Page 19 of 198
  20. 20. Thus, even once that ‘initial hurdle’ has been overcome, negative experiences may prevent a customer (buyer or seller) from returning, acting almost like a solvent to dissolve eBay’s stickiness. 2.3 User Experience Despite potential for negative MoTs, on the whole it is arguable that whatever eBay does, it does it well. The number of worldwide registered users (181 million registered users, March 2005, eBay.co.uk, n.d., a) and the abounding reports to its stickiness, outlined earlier, would seem to attest this claim. It would appear, as mentioned previously, that eBay is now a ‘household name’, used far and wide in order to purchase a diversity of items, as the following quote from Neil, suggests: And all my colleagues I work with, they as well go and eBay - the things they buy are pretty diverse - one bought a motorbike the other week - you know, beautiful motorbike, and another one is selling china, some special Denby, or something like that, I think it’s called. Which he’s selling on eBay. Everybody I’ve met so far at the university’s on eBay. Everybody. (Neil, stamp and cover collector) To investigate its success, this report will look at the eBay user experience in a little more detail, going beyond notions of branding, trust, and usability, and holistically teasing out some support for the assumption that eBay serves its audience well – “99.97 percent of eBay users … have a fun, positive and rewarding trading experience” (Whitman, 1999, cited in Boyd, 2002). Where applicable, evidence to the contrary will also be offered. Although not an exhaustive account of the eBay user experience, the focus will largely relate to aspects of this experience that rely on eBay as an intermediary. “User experience simply refers to the way a product behaves and is used in the real world. A positive user experience is one in which the goals of both the user and the organization that created the product are met. "Usability" is one attribute of a successful user experience, but usability alone does not make an experience positive for the user. Historically, product design and development has considered the mere existence of a particular feature as evidence that a user goal is fulfilled by the product -- with no attention paid to the experience the user has with the product while using the feature”. Garrett, author of ‘The Elements of User Experience (cited in Rhodes, 2003) © 2006, University of Essex http://www.essex.ac.uk/chimera/ Page 20 of 198
  21. 21. Further to the effects of usability, previously discussed, “research has shown that Internet shoppers use caution when purchasing and paying for products purchased over the Internet” (Bland et al., 2005: 6). Essentially, the ability to attract online customers and get them to actually complete their transactions is influenced, not only by usability, but also the perception of risk (Bland et al., 2005). For the consumer it is imperative that the perceived benefits of using an e-commerce medium, in our instance eBay, significantly outweighs potential risks and inconveniences. This is a sine qua non for transactions to occur: “… and it is risky. I mean, you are always … you’re relying on the honesty of the seller. Erm, so you’ve always got to judge whether you take the risk or not, with any particular item. Erm, whether you think it’s going to be worthwhile” (Martin, radio collector). Accordingly, when considering any e-commerce medium, not just eBay, there is a need to think beyond attributes of a negative user experience such as difficulty of use - as problems with trustworthiness, as well as privacy and customer service issues, constitute real psychological barriers to adoption (Egger, 2000). The need for people to protect themselves, their assets, and those they love, is as old as humankind itself. Through their experiences individuals learn to protect themselves during their day-to-day encounters. In terms of user perceptions of trustworthiness, trust building is essentially a learning process, built day-to-day through various ‘evidence-collecting channels’ (Yunjie et al., 2004). The antecedents of trust may be fostered through personal experience or, as offered by social learning theory (SLT), vicariously through experience in a social context - through a process of modelling (the process of observing others responding to an environment and experiencing the consequences). Essentially, such modelling includes both vicarious learning (i.e. observing others) and symbolic learning (e.g. learning through printed media). As Yunjie et al. (2004: 10) posit, from a SLT perspective “the trust building process is essentially an expectancy formation process”, whereby the observation of seeing others perform threatening activities without adverse consequences can antecede the observer’s expectation when faced with the same stimulus (Bandura, 1977). Notions of reputation incorporate another’s behavioral consequence. Thus, word-of-mouth constitutes a vehicle of social learning, as both word-of- mouth advocacy and negative word-of-mouth can profoundly impact on trust decisions associated with the adoption of a new technology. Naturally, media perceptions also provide vicarious experience, acting to build or discourage perceptions of trust, in a process akin to trust transference (Doney and Cannon, 1997 cited in Egger, 2003), which will be discussed further, later this report. © 2006, University of Essex http://www.essex.ac.uk/chimera/ Page 21 of 198
  22. 22. 3 Trust, Mistrust & Risk Overall, it can be said that trust is essential in any relationship, not just those played out online. But what do we mean by the term trust? How is trust formed, maintained and lost in electronically-mediated buyer-seller relationships? And just how essential is the trustworthiness of a vendor, anyway? Essentially, trust is not a characteristic of the e-commerce site in question. Rather, trust is a judgment made by the user, based on “general experience learned from being a consumer and from the perception of the particular merchant” (Sisson, 2000). Numerous factors undoubtedly influence one’s perception of trust, with some having a greater impact on the perceived trustworthiness of the vendor, than others. Here it is appropriate to make the necessary distinction between trust and trustworthiness, as the two should not be discussed synonymously: trust is an attribute of the subject (the trustor), whereas trustworthiness is an attribute of the object (the trustee) (Egger, 2005). 3.1 Trust Defined Successful e-commerce, whether on eBay or Amazon or elsewhere online, requires trust. Before highlighting our findings with respect to eBay and elements of trust, we begin our look at trustworthiness with a definition. An understanding of trust as it relates to online transactions can be developed based on the work completed in offline trust research. As Möllering et al. (2004, cited in Watson, 2004) note, the term ‘trust’ dates back to the 13th century, having its roots in expressions that symbolise faithfulness and loyalty. Despite this pedigree, however, due to the dynamic nature of ‘relationships’, the variety of contexts in which trust is a vital component, and the plethora of academic vantage points interested in this concept, finding a catch-all definition of trust proves difficult. In psychology, one of the most frequently used definitions comes from Rotter (1980: 1), an early researcher of trust, who conceptualises trust as a belief, expectancy, or feeling … “that the word, promise, oral or written statement of another individual or group can be relied upon”. This definition is still heavily employed. Koller’s (1988: 266) definition, which expands on this expectancy view of trust, appears most appropriate for our current purpose. “A person's expectation that an interaction partner is able and willing to behave promotively towards the person, even when the interaction partner is free to choose among © 2006, University of Essex http://www.essex.ac.uk/chimera/ Page 22 of 198
  23. 23. alternative behaviours that could lead to negative consequences for the person. The degree of trust can be said to be higher the stronger the individual holds this expectation”. 3.1.1 Trust Thresholds Trust thus acts as a mechanism which enables action in the face of risk (Boyd, 2002). However, rather than simply talking in terms of ‘trustworthy’ or ‘not trustworthy’, of specific interest in Koller’s definition is the acknowledgment of different degrees or strengths of trust. Tan and Thoen’s (2000) generic model of trust for e-commerce accords with this notion. Indeed, central to their model is the notion that for consumers (the trustors) to engage in a commercial transaction, their level of trust must exceed a personal threshold, which is influenced by factors such as personality (e.g. risk seeking vs. risk-averse) and by the potential profit or utility gained from entering into the transaction. Tan and Thoen (2000) also distinguish between Party Trust and Control Trust, arguing that if the trustor’s subjective trust feelings about the other party (i.e. Party trust) do not exceed one's threshold, then Party Trust needs to be complemented by Control Trust, which relates to more objective and independent control mechanisms: i.e. Party Trust + Control Trust = Transaction Trust (Tan and Thoen, 2000). Basically, arguing for the duality of trust and control, if trading partners do not directly trust each other, Tan and Thoen (2000: 1) comment that they can opt to rely on “the procedures and protocols that monitor and control the successful performance of a transaction” instead. Specifically, it is not the control mechanism per se that helps someone reach their threshold. Rather, it is the trust in the control (Control Trust), which supplements one’s Party Trust. This concept of Control Trust somewhat mirrors Chong et al. (2003) notion of ‘intermediary trust’ – see section 3.3.1 (Trust in Sellers and Intermediaries) for an elaboration of this concept. The distinction between Party Trust and Control Trust (or intermediary trust) has notable relevance to instances where trading partners do not know each other before trading takes place. As such, it is pertinent to the operation of eBay, which requires the establishment of trust between strangers who may never meet and who may never engage in a future transaction. In such circumstances, on eBay, control mechanisms such as its feedback forum (see section 3.6 of this report) or payment mechanisms such as PayPal may serve to bolster any faltering trust in one’s transaction partner. Trust in such control mechanisms, however, will differ as a function of © 2006, University of Essex http://www.essex.ac.uk/chimera/ Page 23 of 198
  24. 24. previous experience and trust propensity, which are clearly subjective. Accordingly, as our degree of trust in these mechanisms will not be stable, over time, it does follow that transaction trust will consistently meet or exceed one’s threshold, when similar situations are considered. 3.1.2 The Fragility of Trust “Trust comes on foot but leaves on horseback” (Calman, 2002, cited in Eiser and White, 2005: 12) Following from the above implication that similar situations will not encourage similar trust levels, numerous scholars have commented on the fragility of trust, noting that trust is easier to destroy than create. Arguing that various cognitive factors contribute to this asymmetry, Slovic (1993, cited in Eiser and White, 2005) coined the term ‘trust asymmetry’ in acknowledgement of the fragility of trust - trust is “typically created rather slowly, but it can be destroyed in an instant by a single mishap or mistake” (Eiser and White, 2005: 12). With regards eBay, as anecdotal evidence and findings from our fieldwork suggest, if trust levels are raised to a level where eBay is attempted, a negative experience can discourage this person from making another attempt, especially for ‘high risk’ items: R: Yes, I mean, with you using the name of the business as a username, I suppose the reputation that you have and get through eBay is important to you. OTA: […] I think the key issue with eBay as far as I’m concerned is [the] security of knowing that the thing you’re buying is right. R: Yeah. OTA: And with some things that’s much easier than with others isn’t it, and radios are probably one of the worst things. R: Yes. OTA: Because there’s so much that can be wrong with them, which you can’t even see in a photograph, […] I’ve only ever bought one thing off eBay. R: Yeah. OTA: Which was a crystal set, and when I got it there were bits missing off it. (John, radio collector) At the heart of Slovic’s account is that negative events have more impact on trust judgments than positive events. Specifically, based on work that evaluated the impact of hypothetical news events on people's trust judgments, Slovic found that negative (‘trust-destroying’) events tend to © 2006, University of Essex http://www.essex.ac.uk/chimera/ Page 24 of 198
  25. 25. be more visible and noticeable than positive (‘trust-building’) events, and they also tend to carry more weight in judgment than trust-building events of a comparable magnitude. As if to reinforce asymmetries between trust and distrust, the tendency is also towards bad (‘trust-destroying’) news being perceived as more credible than sources of good news (Eiser and White, 2005). Bad news stories tend to hit the media, a finding which is significant with respect to eBay, given their tendency to attract periods of bad press (e.g. reports concerning instances of fraud). Eiser and White (2005) have shown, however, that Slovic’s notion of trust asymmetry isn’t ubiquitous. In their exploration of ‘marginal trust’ – ie. how trust is built or lost as a result of new information – Eiser and White went beyond Slovic’s ‘negativity bias’ account of trust, adding that additional psychological mechanisms must be at work, as a “one strike and you’re out heuristic” (Eiser and White, 2005: 14) is not always adopted. Our qualitative data supports Eiser and White’s (2005) argument, revealing that, rather than ‘leaving on horseback’, trust can be ‘ferried by a slower beast’. Indeed, a gradual decline in trust can be observed based on an accumulation of negative ‘moments of truth’ - from direct experience or second-hand accounts (e.g. media reports or word-of-mouth) - which operate to weaken the confidence of eBayers. This decline in confidence was reported by Selena, in one of our focus group sessions, who reported a notable decline in her eBay purchasing based on the perception that, increasingly, eBay hosts auctions from less reliable sellers “who are just out to try and rip people off”: S: But I don’t buy much. And it seems to be there are a lot more unreliable people there now, who will try and rip you off and whatever, and I’m probably less into buying now than I used to be. I’m not as confident as a buyer now. R: You think the nature of the thing has changed a bit? S: Yeah. I think a lot more people have signed up who are just out to try and rip people off, probably. R: Than the earlier…? S: Yeah, at the beginning, everybody seemed sort of much more reliable, and that sort of thing. It’s gone down hill a little bit. (Focus Group, E3) Eiser and White (2005) also highlight insights from Signal Detection Theory, suggesting that people are sensitive to the exact outcomes of decisions when adjusting their trust levels - i.e. related to the desirability and undesirability of different outcomes, the potential cost of a trust- related decision is important. In terms of this notion, as our study found, people’s evaluation of the severity of an outcome may change over time, based an accumulation of observed outcomes. © 2006, University of Essex http://www.essex.ac.uk/chimera/ Page 25 of 198
  26. 26. For example, although one of our respondents ‘started small’ and was only prepared to suffer relatively insignificant user costs; over time, what they were prepared to risk had increased: Because when I first started, I bought a few knitting patterns and things really, something for a quid thinking: ‘if it turns up and it’s rubbish, then it’s only a pound’. Whereas when you’ve got into the routine and you’ve had a few nice things, like I bought a scooter for my daughter. And I forget how much - nine or ten pounds. And the Lego was £15. So gradually, what I’m prepared to risk, has gone up - because I’ve had some nice things back. I wouldn’t be as worried now as when I first started - I thought I was mad then, it was just going to disappear, and my cheque was going to disappear, nothing would come. But it hasn’t happened to me yet. (Focus Group, E3) 3.2 Trust & Risk “The Net may consume trust, rather than produce it” (Uslaner, 2000: 8). Obviously, there is a close connection between trust and risk and, arguably, in situations where risk doesn’t exist the need for trust between the two parties is removed. Essentially, then, trust is a vital factor in risky situations where people are vulnerable to the actions of others. Indeed, Deutsch (1960, cited in Egger, 2003) characterises the need for trust arising under the following contextual parameters: • There is an unambiguous course of action in the future; • The outcome depends on the behaviour of another party; • The strength of the harmful event is greater that the beneficial event. Traditional markets rely heavily on the formation of trust, which is built by “repeated interaction and personal relationships” (Cabral and Hortaçsu, 2005: 1). Markets mediated by the Internet, however, tend to be more anonymous and, accordingly, some would argue over whether the same level of trust can actually be established in these markets. eBay, however, does afford the opportunity for a less ‘anonymous’ situation, especially where repeat transactions occur between the same buyers and sellers. Here, once any initial concerns are quashed by initial transactions, a relationship can be established, as Gerard, one of our stamp and cover collectors, reveals: I think what you do is if you’re buying from a new vendor, you try it and you keep your fingers crossed, but once you know they’re okay you can go back. As I said, I haven’t had any problems with vendors, and I think that if you did you only go there once. Whereas you can quite rapidly build up a © 2006, University of Essex http://www.essex.ac.uk/chimera/ Page 26 of 198
  27. 27. relationship with vendors that you buy off regularly. (Gerard, stamp and cover collector) However, even though repeated interactions may foster belief that one’s trading partner will execute their part of the deal, the key to a ‘true trust relationship’ might be something that an online forum, like eBay, cannot guarantee the mediation of. The ‘special ingredient’ may still depend on certain specifics of the transaction. In particular, although repeat transactions may bring an increase in confidence, the feeling of ‘rapport’ may still be lacking: I suppose it’s like everything else, with some people you hit it off, and with other people you don’t, do you? And um, you know perhaps someone I dealt with eight or nine times, and there’s no kind of rapport between us, and perhaps somebody, I’ve dealt with only perhaps once or twice, the third time I’ll buy a cover off them, they’ll e-mail me and say: ‘I put it in the post last night’. And, you know, I’ll e-mail them back and say: ‘I put a cheque in the post this morning’, type of thing. And we trusted each other, so to speak. (Gordon, stamp and cover collector) 3.2.1 Information & Risk e-Commerce by its very nature, involves risks, some of which can be explained by looking at the information available to each party in the transaction. To clarify what this means, Tan and Thoen’s (2000) define the following three situations (italics are the authors’ own emphasis): 1. The situation where information harmony exists, and all parties know everything that is relevant for a transaction; 2. The situation of information ignorance where none of the parties have information relevant for (a part of) a transaction. 3. A situation defined by information asymmetry, where one party has information that the other party does not have. It is this latter situation of information asymmetry that affords opportunistic behaviour, as sellers can exploit the uncertainty afforded by the virtual medium and use information asymmetry (in terms of the item for sale or even their own identity) to their own advantage, at their transaction partner’s expense. With information asymmetry in mind, Tan and Thoen (2000) further define a distinction between: © 2006, University of Essex http://www.essex.ac.uk/chimera/ Page 27 of 198
  28. 28. 1. Cases where the information problem arises before the parties agreed to transact, ex ante (the hidden information problem), and; 2. Hidden action - cases where the problem arises after the transaction has been agreed, ex post (the hidden action problem). Unobservability, which is a major cause for the occurrence of information asymmetries, obviously plays a greater role in e-commerce than it does with more traditional forms of offline commerce. Product and buyer/seller quality cannot be observed with certainty, and the level of hidden information is very difficult to determine. On eBay, however, the seller does benefit from the advantage of holding the goods until they receive payment, or they “can always offer the good for sale again if the original high bidder does not follow through” (Eaton, 2002: 2). On eBay, buying tends to involve the most uncertainty and risk, with information asymmetry constituting a major pitfall for buyers. Although not always, transactions that go awry on eBay tend to arise from instances of ‘information asymmetry’ where there’s a ‘hidden information problem’ – e.g. where the seller knows the ‘true condition’ of an offering and they have successfully managed to ‘hide’ this from potential bidders through strategies such as vague descriptions and/or blurry photographs (or the total omission of an image). For example, sellers may claim ignorance as to the working condition of an item so that, armed with imperfect knowledge, buyers submit a higher bid. One participant, Peter, a radio collector, describes this ‘constructed unknowingness’ in relation to radios, which often involves sellers claiming that they cannot test the item, when in fact the item has been tested and it doesn’t work: And to be totally honest about the description. I think, you know, if there’s something wrong with it, tell the person that there’s something wrong with it. Um. Because we’ve all seen this: ‘I haven’t got the batteries to put in it,’ and you basically know, well that doesn’t work, does it? (Peter, radio collector) For Arthur, another one of our radio collectors, buying on eBay is akin to purchasing at a boot sale where can’t see the item you’re buying. As such, it’s “extremely easy to be robbed” (Arthur, radio collector, interview) by sellers who, purely motivated by a high profit, only ever tell buyers ‘half the truth’. Based on this belief, clear criteria have to be met in order for Arthur to purchase vintage radios from eBay sellers: […] particularly for the buyer, it really is full of pitfalls - I can’t emphasise this strongly enough, I’ve told many people - would you buy anything, would you pay money to someone you don’t know, © 2006, University of Essex http://www.essex.ac.uk/chimera/ Page 28 of 198
  29. 29. you’ve never seen, and would you buy an object with your money that you’ve never seen and never held and never looked at. If you do that, and pay a lot of money out, then you’re a bigger fool than I am. In my opinion, it’s very, very tricky to buy anything successfully, because most often, in my experience, the things that people tell you about their product that they’re selling on there, is only half the truth. There’s always a reason why they’re selling it. […] there are a lot of rogues, an awful lot of rogues on eBay, and you’ve got to be very, very careful. I’ve learnt to spot the signs. […] when I look for a vintage radio, what I need to see are several clean pictures, and I need to know the model and whether it’s complete, whether all the parts are there, I need to see inside of the set from the photograph. I usually e-mail and ask them questions, and if they don’t give me satisfactory answers, I don’t buy. (Arthur, radio collector, interview) As the above quote reveals, hiding the ‘true’ nature of the item extends beyond the item description itself. On eBay, sellers are afforded to chance to provide a more complete description, in response to requests (for additional information) from interested parties. As Arthur’s following comment goes on to suggest, unsatisfactory replies and non-replies can alert suspicion that the seller is hoping to prey on less-knowing bidders who may “plunge in blindly, with some kind of faith in human nature that is often misplaced” (Arthur, radio collector), in order to achieve a price beyond the item’s true market value: There was a radio on some time ago, which, by the look of the very blurred photograph, was an early Pye radio, one with the sunburst grille on the front. A very collectable radio, and there was also a photograph of one end of the radio, and the back view of the radio with a pole in place, showing the inside. So I e-mailed the gentleman who was selling it and asked him why he hadn’t shown a picture of the control panel which is on the other side, than what he photographed, seemed a reasonable question to me, I never got an answer, which tells me that first of all the controls were missing or the knobs were missing - something was missing, and he didn’t want that to show. But somebody bought that radio for £75. And the chances are they bought a dud. Because if he wouldn’t tell me what was wrong with it, and there was obviously something wrong, you know, you wouldn’t buy it. (Arthur, radio collector) It is worthy of note that the trading of unique and collectable items on eBay is, in itself, a major source of uncertainty. For one, with unique items it is not possible for buyers to supplement their understanding by gleaning some knowledge of the item, based on the reputation of the original product (Eaton, 2002). For some items on eBay a limited description, perhaps without a photograph, is acceptable - “A roof rack is a roof rack. You don’t need a top level picture” (Focus © 2006, University of Essex http://www.essex.ac.uk/chimera/ Page 29 of 198
  30. 30. Group, M4). For more collectable items, the information supplied is key. However, many elements of information important to the bidding decision (whether to bid and how much to bid), may be based purely on the seller’s subjective description. For example, with respect to audio equipment, elements that may be critical to the purchase decision might be the audio quality and the aesthetic and/or maintained appearance, which can be highly subjective, and ‘ratings’ may differ. Alternatively, the seller’s description may have been constructed just to get ‘eyeballs’. Item ‘spin’ is all important to appeal to certain markets on eBay, but may not reflect the ‘reality’ of the item under auction: I mean people do… Coming back to this pottery, you get the same item come up, people have called it different… some people will say it’s a porringer and someone will say it’s for hot chocolate, and or ‘very rare’ - all things that people do just to make sure you actually look at that item, because if you’ve just got ‘plate,’ it’s not a very bid word, and people just carry on going. People come up with all manner of things to just make you stop, and just go into the site to see what it is. (Focus group, 2M) 3.3 Establishing Trust in e-Commerce As a wealth of authors have noted (e.g. Egger, 2003), for e-commerce environments trust really is the key to successful transactions. Indeed, in such situations, even high usability is no substitute for an overall feeling of trustworthiness - perceptions of trust have the strongest affect on consumer purchase decisions. “Although better usability will generally improve [online] sites and their potential for success, usability alone will not result in a highly thriving online presence. After all, no reasonable person will spend money at an untrustworthy online store no matter how usable and pretty the site may be” (Lanford and Hübscher, 2004: 315). 3.3.1 Trust in Sellers and Intermediaries With respect to e-commerce, Chong et al. (2003) hypothesise that trust consist of two distinct facets, ‘seller trust’ and ‘intermediary trust’, as below. • Seller trust – a belief or expectation that the word or promise by the seller can be relied upon and the seller will not take advantage of the consumer’s vulnerability. © 2006, University of Essex http://www.essex.ac.uk/chimera/ Page 30 of 198
  31. 31. • Intermediary trust – a buyer’s belief that the intermediary would protect them, provide a secure and stable environment, and ensure problem-free transactions (akin to Tan and Thoen’ s ‘control trust’, previously highlighted in section 3.1.1) Defining these two facets is particularly pertinent to eBay, as eBay represents a trading platform that intermediates, bringing sellers and buyers together and facilitating trade between them. With mediation being conducted through a virtual plane, face-to-face contact between buyers and sellers is typically zero – “sellers are not met, and little or nothing is known about their characteristics, or even their location beyond its city” (Resnick and Zeckhauser, 2001: 2). Moreover, payment normally is made before goods are received or can even be inspected, and repeat transactions (between particular buyers or sellers) are not guaranteed – Resnick and Zeckhauser’s (2001) study reported, over a five month period, that 89% of all seller-buyer pairs conducted just one transaction, and 98.9% conducted no more than four7. On eBay, although the buyer and seller may not have traded before, due to the potential for a reciprocal relationship between intermediary trust and seller trust, buyers may feel ‘safe’ dealing with a particular seller (or vice versa) (Chong et al., 2003). Indeed, as reported by Doney and Cannon (1997 cited in Chong et al., 2003), even if buyers have no or little knowledge of sellers, if ‘intermediary trust’ has been established and maintained (i.e. trust in eBay) this may have a direct impact on ‘seller trust’ through a process of ‘affect transfer’. Here, Tan and Thoen’s (2000) notion of ‘control trust’, cited previously (see section 3.1.1), has relevance, as intermediaries such as eBay provide informal and formal ‘control mechanisms’ which monitor and control transactions (both buyers’ and sellers’ behaviour), in order to help promote proper behaviour and punish opportunistic behaviour. As a slight revision to these two facets defined by Chong, et al. (2003), the authors would like to emphasise that ‘seller trust’ must also be extended to accommodate ‘buyer trust’ as, with platforms such as eBay, it is also vital that sellers have trust in those bidding on their auctions. 7 “In the vast majority of cases, multiple transactions between a seller and buyer occurred within a few days of each other (sellers often offer reduced shipping costs to buyers who buy several items that can be shipped together)” (Resnick and Zeckhauser, 2001: 9). © 2006, University of Essex http://www.essex.ac.uk/chimera/ Page 31 of 198
  32. 32. Trust in eBay as an Intermediary When it comes to protecting sensitive personal information in particular, eBay’s trustworthiness rating, although relatively high, reveals that consumers are starting to demonstrate concern. According TRUSTe and Ponemon Institute’s second annual ‘Most Trusted Company for Privacy Award’, consumers increasingly consider privacy important: “More consumers call privacy important, respondents punish companies with publicized security breaches” (TRUSTe and Ponemon Institute, 2005) In the first of TRUSTe and Ponemon Institute’s surveys, which intended to collect opinions regarding online companies’ privacy practices and history, analysis revealed that eBay was believed to be the most trusted company, in terms of honouring their privacy commitments (see table 1, below). Table 1: Most Trusted Companies (TRUSTe and Ponemon Institute, 2004) • eBay • American Express • Procter & Gamble (all brands) • Amazon • Hewlett Packard • U.S. Postal Service • IBM • Earthlink • Citibank • Dell Conducting their survey again in 2005, following “a year when privacy issues made headlines and identity theft became the fastest growing crime in the United States”, participants were seen to register greater concern over privacy issues8, highlighting phishing attacks as a significant concern (TRUSTe and Ponemon, 2005). With such concerns having an impact, the 2005 results 8 “The percentage of respondents calling the privacy of personal data “important” and “very important” grew by 1.4 percent each to a combined total of 84.8 percent” (TRUSTe and Ponemon, 2005). © 2006, University of Essex http://www.essex.ac.uk/chimera/ Page 32 of 198
  33. 33. reveal that consumer confidence in eBay is waning - eBay are now ranked in fifth place9 losing out to companies such as American Express and Amazon, who are ranked first and second, respectively. “Consumers showed increased understanding of privacy issues this year, citing resolution of personal privacy concerns, media reports about the company’s privacy practices and respect for consumers’ privacy significantly more often compared to last year, and the company’s overall reputation less often” (TRUSTe and Ponemon, 2005). Table 2: Most Trusted Companies10, listed in rank order with last year’s top 20 rank in parentheses (TRUSTe and Ponemon, 2005). Concerning perceptions of eBay’s privacy practice and history, a number of participants in our fieldwork reported concern about their own consumer privacy on eBay (see also section on privacy in our Chimera Working Paper 2006-09). Although eBay does have its own privacy policy, certain criticisms can be made. For example, Jason Catlett of Junkbusters Corp (Junkbusters, 2003) levels four main criticisms against eBay’s privacy policy: that your e-mail address may be harvested by spammers; that eBay will retain your personal information indefinitely, even if you ask them to delete it; the company will collect and maintain information about you which it will not be permit you to access; and the company 9 “Participants were not given company names to rate; they were asked for the companies they considered noteworthy for their trustworthiness” (TRUSTe and Ponemon, 2005). 10 A tie for twentieth place resulted in 21 finalists rather than 20 (TRUSTe and Ponemon, 2005). © 2006, University of Essex http://www.essex.ac.uk/chimera/ Page 33 of 198
  34. 34. may give your personal information to parties investigating you (such as law enforcement officers or government officials) or litigating against you without a court order and without telling you. eBay’s global nature is also said to compound these problems, as it is said eBay require users from outside the US to agree to processing of they personal data below the minimum statutory standards of many countries (Junkbusters, 2003). However, user concerns about privacy concerned how eBay disclose personal information in relation to the wider eBay community. eBay’s privacy policy states (eBay, n.d., c): (b) eBay Community. Your User ID is displayed throughout the Site and is therefore available to the public. All of your activities on the Site will be identifiable to your User ID. Other people can see your bids, items that you have purchased in the past, your feedback rating and associated comments, your postings on the Site, and so on. Therefore, if you associate your name with your User ID, the people you have revealed your name to will be able to personally identify your eBay activities. The issue of seeing what people had bought and sold through their feedback profile, was viewed as particularly contentious: L: The only funny thing that it’s fun to do sometimes is to go back and look at what some people have actually bought on eBay by going back through their feedback and clicking on the item, because that can be very amusing. T: I’m not sure that you should be allowed to do that really.[…] It just seems a bit strange that you can go through. (Focus group 2M) People believed they might be identifiable through what they had bought and sold, and for those members whose user IDs were known to friends and family, this could be embarrassing – especially if they were selling unwanted gifts: “I don’t like other people seeing what I’m buying and selling either, because I sell … a present someone’s given to me, but I don’t want them to see that I’m selling it on eBay, because that’s awful” (Focus group 3E). Looking through people’s feedback to view the items they had bought and sold was often seen as a source of amusement, especially with friends’ user IDs: “Actually it’s quite fun now as I can actually click on my friends’ identities and see what they bought at the car boot sale at the weekend, so it’s quite funny, isn’t it?” (Peter, radio collector). Although ‘snooping’ the profile of another eBayer could be considered to represent a harmless curiosity into people’s lives, it is possible that this ‘bid-stalking’ could turn into something more © 2006, University of Essex http://www.essex.ac.uk/chimera/ Page 34 of 198
  35. 35. sinister. If someone wishes to find out another person’s home address on eBay, this can easily be done by completing a transaction with them. It is possible to have private feedback, but this creates a climate of mistrust – other people believe you have something to hide, perhaps very negative evaluations from others: “People have private feedback, as well - I don’t have them bidding on my items. Because I want to see what they’ve got, especially if they’ve got like two negatives. Even if they’ve got fifty positives, I want to know what those two negatives were for. You know, just to find out” (Focus group 2E). Essentially, there needs to be a careful balance between transparency of feedback and being able to find out ‘too much’ about a person. Looking at previous feedback can be ‘intrusive’. However, seeing what people have bought or sold can also be somewhat ‘instructive’. For example, it can help identify fraud in some instances – such as a case followed by the researchers, during the fieldwork, where a Czech glass car mascot was passed off as being by Lalique (the famous glass designer) and previously owned by the seller’s father in the 1930s during a period playing in the French rugby team. Upon closer inspection of the seller’s feedback, however, it was actually revealed to have been purchased on eBay two weeks previously, by the seller for £50. With the Lalique label and provenance it reached nearly £1000. Arguably, it is generally less useful to see what people have bought compared to what they have sold, and it is worth reflecting on whether links to items in people’s feedback profiles should disappear faster for what they have bought. Another participant also complained about others being able to see what you are currently bidding on, using eBay’s advanced search facilities – he described this as a “gross invasion of privacy” (Ernie, stamp and cover collector). Indeed, concerning this, the purpose and ultimate value of this facility is somewhat questionable. Another privacy concern, expressed by participants, relates to the eBay toolbar. eBay’s toolbar is ostensibly offered to users so they can differentiate spoof sites, which look like eBay, from the real thing. However, when users scan for spyware, the eBay toolbar was discovered to contain spyware elements: Yeah it’s billed as anti-spoofing and it won’t do anything. And I saw it - that was on the chatboard as well because I was looking for a... I had a question about selling so I went on it and I typed it in - and, erm, I saw that one of the people had an About Me page and it is all this anti-virus stuff and anti-spy ware. And I downloaded like window-washer or something, and it went through and it was just like this © 2006, University of Essex http://www.essex.ac.uk/chimera/ Page 35 of 198
  36. 36. huge amount of like crap and it was all in ... it all had eBay on it - like five-hundred megabytes of stuff and I just thought right, that’s it, eBay toolbar’s gone. (Focus group 2E) Although the eBay toolbar page attempts to reassure that no spyware is contained within it (in terms of personally identifiable or trackable tags), the toolbar does gather data to attain an aggregate view of user activities. In terms of the promise of this feature, the authors argue that if eBay genuinely want to support identification of spoof websites and, thus, protect their users’ accounts, eBay needs to remove this tracking element from its toolbar – or, potentially, face user rejection. This issue was raised during an eBay University question and answer session, and eBay’s response was that they were trying to work with spyware detection software developers, so that the eBay toolbar would not be identified as spyware. However, user perceptions have already been formed about the eBay toolbar, and ‘masking’ the fact that it is gathering data is unlikely to be a successful strategy. 3.3.2 Moving people towards the ‘active green’ As aforementioned, problems with trustworthiness may constitute a real psychological barrier to eBay adoption. The rich focus of Egger’s (2003) Model of Trust in E-Commerce (hereafter MoTEC), developed from literature derived from Psychology, Marketing, Management and HCI; identifies trust-shaping factors (both online or offline) idiosyncratic to electronically-mediated buyer-vendor relationships. As a powerful model, applicable to the design and evaluation of electronic commerce systems, Egger considers factors beyond the user interface, bringing together elements such as usability, branding, reputation and customer relationship management. Specifically, with its focus on ‘initial trust’, the model has been iteratively revised to reflect the different phases a visitor goes through when exploring an e-commerce website for the first time. As such, the model presents four dimensions, which are divided into different components and sub-components: Pre-interactional Filters, Interface Properties, Informational Content, Relationship Management – for an in depth discussion see Egger (2003). While not an exhaustive account, our current exploration of eBay presents a flavour of our findings with respect to eBay as a trust-shaping intermediary and wider reflections of the eBay user experience. As Egger’s model largely applies to a traditional business-to-consumer e- commerce environment (which reflects only a section of eBay’s market), our current discussion © 2006, University of Essex http://www.essex.ac.uk/chimera/ Page 36 of 198
  37. 37. will ‘dip into’ Egger’s framework, largely consulting his initial two dimensions, presenting related concepts and extending into aspects of the consumers’ affective experience, when using eBay as an intermediary. Egger’s (2003) first dimension, Pre-interactional Filters, discussed in the following section, concerns factors relating to user psychology and fore- or pre-purchase knowledge which combine to affect perceptions of trustworthiness even before an e-commerce system, such as eBay, is directly accessed. The second dimension, Interface Properties (discussed in section 4 Interface Properties & Beyond), which comprises usability and branding, relates to the more ‘superficial’ aspects of an e-commerce site and one's overall first impression of the site as a commercial system. As Egger indicates, given that an emotional response can precede a cognitive perception and response (Goleman, 1996), superficial does not mean aspects that are mostly cosmetic and easily changeable as “superficial though they may seem, interface design features are likely to have a non-negligible effect on a user’s subsequent decision to trust” (Egger, 2003) and, hence, their adoption of the website in question. 3.3.3 Pre-interactional filters Essentially, the decision for people to trust is binary, and a person’s level of trust can be seen to fluctuate during successive interactions with a website, as an increasing amount of information concerning the other party is processed (Fogg and Tseng, 1999, cited in Egger, 2003). Based on this view, one can assume that prior to interacting with a given website, initial trust values will be based on people’s predisposition to trust and their pre-knowledge and expectations with respect to the industry or company in question. As Egger (2003) comments, the latter can fostered due to the reputation of the company (i.e. the strength of a company's brand name), previous interactions (on- and/or off-line), or through or third party reports which signal the ‘transference’ of trust. Concerning one’s general propensity to trust another party (a person, group, or business), large individual differences in one’s readiness to trust relate to “a variety of philosophical and moral attitudes about the goodness of others”, personal experience(s), and also culture (Egger, 2003: 36). With regards to the design of an e-commerce site, if one acknowledges trust propensities, then even if trust-inducing features are introduced into an e-commerce system they may not be © 2006, University of Essex http://www.essex.ac.uk/chimera/ Page 37 of 198

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