The popularity of e-commerce can be attributed to open (and mostly unbridled) competition with minimal barriers to entry. Yet, recent surveys suggest a general lack of consumer confidence in transacting online. Such findings are troubling — pointing to probable inefficiencies in e-commerce. The question then is: what are these inefficiencies and how do they prompt such consumer uncertainty? In answering the question, this paper surfaces three core e-commerce inefficiencies: seller anonymity, lack of product transparency, and lack of process transparency. It is also contended that consumer uncertainty is not an intrinsic buyer characteristic. Rather, it is contingent upon the information specificity of specific products that consumers transact in B2C and C2C e-commerce. Tying together threads from behavioral economics, this paper offers a novel perspective toward understanding electronic market inefficiencies and its consequent effects on consumer uncertainty. Apart from proposing a model of consumer uncertainty in e-commerce, the study offers a preliminary empirical validation of the proposed model. Findings suggest that inherent Ecommerce inefficiencies of anonymity and lack of product and process transparencies cause consumer uncertainty. The findings further evidence how buyer uncertainty increases when planning to buy products with high information specificity, especially when product transparency is lacking.
Chatterjee, Sutirtha and Datta, Pratim
"Examining Inefficiencies and Consumer Uncertainty in E-Commerce,"
Communications of the Association for Information Systems:
Vol. 22, Article 29.
Available at: http://aisel.aisnet.org/cais/vol22/iss1/29