How Buyer Experience in Online Auctions Affects the Dimensionality of Trust in Sellers: An Unexpected Finding

The expectation was that experienced subjects would have a more detailed, differentiated conceptualization of TIS than inexperienced subjects, but the opposite was found, and the halo/horns effect was found.

Abstract

In commercial transactions, trust in sellers (TIS) is the degree of trust that buyers bestow upon sellers. The existence and level of TIS is obviously a factor determining whether buyers will buy. TIS is particularly important in consumer-to-consumer e-commerce transactions, such as online auctions, which are characterized by anonymity and asymmetric product quality information. Given the importance of TIS, the dimensionality of the construct was investigated using confirmatory factor analysis, employing buyer experience as a mediator. The expectation was that experienced subjects (subjects who have made a bid) would have a more detailed, differentiated conceptualization of TIS than inexperienced subjects (subjects who have never bid before), but the opposite was found. This is tentatively ascribed to the halo/horns effect, well-known from the performance appraisal literature. The managerial implications of this result, its possible effects on buyers' purchase intentions, and directions for future research are discussed.