The effect of offline brand trust and perceived internet confidence on online shopping intention in the integrated multi-channel context

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IJRDM 37,2

126 Received 10 April 2008 Revised 20 July 2008 Accepted 27 August 2008

The effect of offline brand trust and perceived internet confidence on online shopping intention in the integrated multi-channel context Kim Hongyoun Hahn  Apparel and Communication Technologies Department, University Univer sity of Wisco Wisconsin-St nsin-Stout, out, Menomonie, Wisconsin, Wisconsin, USA, and 

 Jihyun Kim  Department of Apparel, Housing, and Resource Management, Virginia Virgin ia Polyt Polytechni echnicc Insti Institute tute and State University, University, Blacks Blacksburg, burg, Virginia, USA

Abstract Purpose – The purpose of this research is to examine the influences of consumer trust and perceived internet confidence on consumer apparel shopping intention via the online retailer operated by a multi-channel retailer. Design/methodology/approach – A total of 261 students in a large US Midwestern University participated in the paper-based survey and provided usable responses. Structural equation modeling was used to test hypotheses. Findings – Consumer trust in an online retailer was a significant predictor of perceived internet confidence and search intention for product information via the online retailer. Search intention for product information via the online store and perceived internet confidence were significant and strong predictors of consumers’ behavioral intention toward the online retailer. Research limitations/implications – Limitations of the present study include sampling, which prevents the generalization of the results to all multi-channel shoppers. Practical implications – The findings of the study suggest that retailers offer an internet channel as part of a multi-channel retail strategy and provide consistent service throughout their various channels. Originality/value – The paper finds that there are significant influences of consumer trust and perceived internet confidence on consumer apparel shopping intention via the online retailer operated by a multi-channel retailer. Keywords Brand image, Internet shopping, Consumer behaviour, Trust, United States of America, Retailing Paper type Research paper

International Journal of Retail & Distribution Management Vol. 37 No. 2, 2009 pp. 126-141 q Emerald Group Publishing Limited 0959-0552 DOI 10.1108/09590550910934272

Introduction Onli On line ne bu busi sines nesss is st stead eadil ily y in incr crea easi sing ng ev ever ery y ye year ar,, no nott en enti tire rely ly be beca caus usee of pu pure re web-based retailers, but also due to multi-channel retailers conducting business both online and offline. According to comScore Networks, online retail sales in 2006 were US$102.1 billion, which was a 24 percent increase from 2005 (Burns, 2007). e-Commerce sales sal es inc increa rease se is rem remark arkabl ablee ove overr tim timee and wil willl con continu tinuee by 201 20100 (Pe (Perez rez,, 200 2006). 6).

According to Jupiter Research, e-commerce retail sales are expected to have a 12 percent annual increase and estimated sales of US$144 billion in 2010. Jupiter Research also emphasized that the multi-channel strategy would be more prevalent for a retailer’s success (Evans, 2006). A multi-channel strategy provides the retail company with a competitive edge by operating two or more retail channels to distribute products to customers. The multi-channel retailers generate greater revenue than single channel retail operator because they attract more cross-shoppers (Levy and Weitz, 2004). For example, consumers may view the products online and visit the brick-and-mortar store for the purchases or vice versa. Retailers can embrace the broader range of customers (Payne and Frow, 2004) and build more interactive customer relationships by offering information, products, and customer support using a multi-channel strategy (Freed, 2005; Shop Org., 2001). Multi-channel retailing also provides customers with convenience of shopping, which is most sought after by the customer. According to Schramm-Klein and Morschett (2005), the goal of multi-channel retailing is to fulfill all the needs and requirements of today’s consumers that no single purchasing channel can comply with. As a result, more and more customers are adopting multi-channel retailing and are becoming multi-channel shoppers. According to the Direct Marketing Association’s 2005 Multi-channel Marketing Report, multi-channel shoppers spend 30 percent more per year in stores than single-channel shopper as cited in Fanelli et al. (2006). Furthermore, in a survey conducted by the Aberdeen Group (2005), more than 50 percent of retailers reported multi-channel shoppers are more profitable than single-channel customers. It has been proven in many studies that using various retail channels, multi-channel shoppers search and purchase products more frequently as well as spend more money than single channel customers (Dholakia et al., 2005; Rangaswamy and van Bruggen, 2005; Shankar and Winer, 2005). In the multi-channel retail environment, consumer trust is the one of the key elements that enables customers to adopt a multi-channel retail strategy (Schlosser et al., 2006; Winch and Joyce, 2006). Consumer trust has been acknowledged in marketing literature as a crucial factor for successful business trades, and in turn, the development and management for a long-term customer relationship. Trust has been defined as a willingness to rely on an exchange partner in whom one has confidence, reliability, and integrity (Morgan and Hunt, 1994; Moorman et al., 1992). The belief in a person’s competence to perform a specific task under specific circumstances is also pointed out as a facet of the trust concept. We believe that people, who trust a traditional brick-and-mortar retailer, will have a similar level of confidence in shopping for products at the online retailer, operated by the traditional store that she or he has the trusts. Especially, when consumers are uncertain about online shopping, they will likely rely on the trusted retailer’s web site (Chaudhuri and Holbrook, 2001). Purchasing products online often involves various level of risk/uncertainty, especially when consumers need to provide an online retailer with their personal information such as credit card numbers. In this vulnerable situation, consumer’s trust of a company may reduce any uncertainty that consumers have about online shopping. Several studies investigated the issues of trust in the online environment (Gefen et al., 2003; Stewart, 2003; Winch and Joyce, 2006). There is little research investigating the potential influence of pre-existing consumer trust in an offline brick-and-mortar retailer on consumer’s perceptions of internet shopping at the offline retailer’s web site

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(Lee et al., 2007; Kuan and Bock, 2007). Lee et al. (2007) examined the influence of trust in an offline banking system on consumers’ online banking perceptions. Kuan and Bock (2007) investigated the factors affecting the formation of online trust for consumers of a brick and mortar supermarket retailer. These studies focused on the offline/online baking industry and supermarket retailing context; however, they did not address the sensory and interactive nature of different types of shopping behavior such as apparel shopping; where consumers are likely to physically examine the characteristics of the products (color, size, design, fabric and fit) (Ha and Stoel, 2004). Because of the nature of “hands-on” aspect of apparel shopping, apparel online shopping has been associated with a higher perceived risk (Bhatnagar et al., 2000; Hawes and Lumpkin, 1986) and this risk has been often linked to trust in online shopping behavior (Newholm et al., 2004). Therefore, it will be important to examine if  there is a positive relationship between consumer trust in an offline retailer and perceived confidence while shopping at the retailer’s online store within a multi-channel retailing context for apparel products. Converting online visitors into buyers is one of the biggest problems that many online businesses face in daily basis. Another significant issue with the online shopping is that online apparel shopping still lacks critical tactile aspects of an offline shopping experience. The purpose of this study is to examine the effect of consumer trust and perceived confidence of internet shopping on their behavioral intentions towards the online store. Through examining these relationships, this study provided some ideas to solve several issues involved in both online and offline business for multi-channel retailers. Literature review and theoretical framework Consumer trust and perceived confidence of internet shopping  According to Winch and Joyce (2006), trust is a strong influential factor for making a purchase in both offline and online environments; however, in the online environment, trust is built primarily in a person-to-web site manner rather than person-to-person communication, mediated through technology. Therefore, without having trust built, it is likely that business transactions would not be possible in an online environment, just as it would not be possible in the offline environment (Winch and Joyce, 2006; Bart et al., 2005). In the online business environment, consumers view the technology as a tool that mediates the underlying process of obtaining a product, service, and/or information from an online business (Shim et al., 2001). During online shopping, trust can be a vital factor for consumers to make purchase decision since consumers often perceive risks involved in online transactions such as financial risk, product risk and concern for privacy and security (Winch and Joyce, 2006; Bart et al., 2005; Li and Zhang, 2002). When online shopping was first introduced to consumers, first time online shoppers were not comfortable using the internet for purchasing goods because they were not sure of their ability to shop for products over the internet (Bobbit and Dabholkar, 2001; Eastin and LaRose, 2000). Researchers found the importance of perceived behavioral control (Ajzen, 1991) to be an important determinant to predict intentions and behaviors of online consumers (Bobbit and Dabholkar, 2001; Cunningham et al., 2005). Bobbit and Dabholkar (2001) applied the perceived behavioral control in an internet shopping context and referred to it as having levels of ease or difficulty within the

online shopping process. Bobbit and Dabholkar (2001) also claimed that perceived behavioral control is closely related to the consumer’s confidence in his/her ability to shop via the internet. Consumers who have built trust in a brick-and-mortar retailer would be willing to accept its new retail channel format, internet shopping site, for their shopping needs. In turn, based on the previous shopping experience with the brick-and-mortar retailer, consumers may be more confident in shopping via the brick-and-mortar retailer’s internet site. According to Li and Zhang (2002), consumers’ trust in a retailer can reduce perceived risk associated with context of online transactions. Therefore, Consumers perhaps are more confident shopping at the brick-and-click retailers’ internet shopping sites because those online sites carry over the brand image that the retailers have previously established. In the same logic, consumers who do not have trust built with an offline retailer would be less confident in shopping at the internet retailer due to the lack of shopping experience with the brick-and-mortar retailer. Park and Stoel (2005) found a very strong positive effect of brand familiarity on the consumer’s intentions to shop at retailer web sites. We believe that if consumers have trust in a brick-and-mortar retailer, they will likely to be confident shopping at the retailer’s web site. Therefore, we propose:  H1.

There is a positive relationship between consumers’ trust in an offline store and their perceived internet confidence at the retailer’s online store.

Consumer trust and information search intention Consumer trust of a brick-and-mortar retailer may influence his/her information search behavior using the retailer’s online store. Researchers found that consumer chose information sources they trusted when they searching for valid, accurate, and timely information (Chaudhuri and Holbrook, 2001; Pavlou and Eugenson, 2006). Similarly, Schlosser et al. (2006) found that consumers are likely to search information at the web site offered by the company that they already trust because they expect the company they trust and are familiar with will provide optimal information for them. For the internet shopping case, these findings are applicable as well. For apparel product information, individuals look for the retailers they trust or are at least somewhat familiar with, instead of unknown retailers. Since apparel is a significant part of the individual’s appearance presentation (Kaiser, 1990), he/she would search a trusted retailer’s websites for apparel information. Consequently, we expect that when consumers trust a brick-and-mortar retailer, they will have higher information search intention using the retailer’s web site. Therefore, we hypothesize:  H2.

There is a positive relationship between consumers’ trust in an offline retailer and their information search intention using the retailer’s online store.

Consumer trust and behavioral intentions The relationships between trust and behavioral intentions have been examined frequently in previous online shopping research. Lui et al. (2005) examined an individual’s perceptions of privacy and how it related to his or her behavioral intention to make an online transaction. Lui et al. (2005) found that trust was an important factor to predict consumers’ intention for online shopping. Kuan and Bock (2007) also confirmed the positive relationship between online trust and online purchase intention

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in a grocery shopping context. In the multi-channel banking context, Lee et al. (2007) found that consumer trust in an offline bank was a significant predictor of the perceived future use of the online banking system of the offline bank. Furthermore, consumers perceptions of brand trust and repurchase intentions have been examined by Zboja and Voorhees (2006). Zboja and Voorhees (2006) found that brand trust was clearly linked to customers’ satisfaction levels and repeat purchase intentions. Therefore, based on previous studies, we propose that when consumers have an existing trust in an offline store, they are willing to purchase the products online, willing to spend more time at the trusted retailer’s web site and willing to recommend that same online store to others. Hence, we hypothesize that:  H3.

There is a positive relationship between consumer trust in an offline store and behavioral intention toward the online store.

 Perceived internet confidence and information search intention Koufaris and Hampton-Sosa (2002) studied how the web site experience can influence customer trust in the company itself through customer beliefs about the web site. They discovered that if customers found a company’s web site easy to use and useful then consequently customers viewed the company more favorably and perceive organization as being more trustworthy. When consumers perceive a site as useful and easy to use, they are more likely to search information from that particular web site. For example, younger, rural consumers with prior internet experience had higher information search intention via the internet, compared to ones with no internet experience (Worthy et al., 2004). As discussed earlier, if consumers have more confidence in using a web site for valid, credible, and accurate information, they will have more intention to search for information from that particular web site as well. Thus, we propose:  H4.

There is a positive relationship between consumers’ perceived internet confidence of internet shopping at the online retailer and their information search intention using the retailer’s online store.

 Perceived internet confidence and behavioral intentions The importance of building trust or confidence in online shopping has been much emphasized in literature (Constantinides, 2004; Koufaris and Hampton-Sosa, 2002). According to Wolfinbarger and Gilly (2000), online shopping gives consumers a great deal of freedom and control because it is convenient, accessible and allows products and pricing comparisons. Koufaris and Hampton-Sosa (2002) proved that there was a positive relationship between perceived control, perceived usefulness, and perceived ease of use of a web site. If consumers find a company’s web site easy to use, useful, and safe to use, they may be more likely to make more purchases from that web site. Therefore, if consumers experience smooth transactions online overtime and feel confident about online transactions and shopping at online retailers, they are more likely to have higher purchase intention for the online retailer web site. Similar to this logic, consumers who have more confidence in shopping online may stay longer at the web site for shopping, compared to those who have lower confidence in internet shopping.

Also, consumers with more confidence in internet shopping at an online store may have more experience with the online store. Based on their confidence and previous experience with the online retailer, they may be more willing to recommend the online store to others, compared to those with less confidence in internet shopping at the online store. Therefore, we propose:

Perceived internet confidence

There is a positive relationship between consumers’ perceived confidence of  internet shopping at the online retailer and their behavioral intention toward the online store.

131

 H5.

 Information search intention and behavioral intentions  Intention to purchase. The relationship between intention to use the internet for information search and intention to use the internet for purchasing was found in the online pre-purchase intentions model developed by Shim et al. (2001). Individuals who had greater intention to use the internet for information search were likely to have greater intention to use the internet for purchasing. Klein’s (1998) economics of  information search model addressed that consumers would choose the least costly way for searching and purchasing goods and services. Searching and purchasing within one channel (e.g. the internet) may be perceived as less costly than searching and purchasing in multiple channels. Thus, consumers may choose a single channel to reduce shopping cost rather than use multiple channels for gathering information and purchasing products. Empirical research studies also supported that consumers were likely to search more information from the internet when purchasing products online (Kim and Park, 2005; Lohse et al., 2000; Ratchford et al., 2003; Rowley, 2000). The positive relationship between internet information search intention and internet purchase intention was also found for apparel products in previous studies (Shim et al., 2001; Watchravesringkan and Shim, 2003).  Intention to spend more time at the online store. Research studies showed that consumers who use the internet for product information search were also likely to spend more time on the internet (Lohse et al., 2000; Kim and Park, 2005). Online shoppers expressed that they could fully examine various options for product purchases through online shopping, compared to the offline shopping context (Wolfinbarger and Gilly, 2000). Consumers not only compare prices but also compare product attributes offered within an online retailer or by different online retailers. Therefore, they may spend more time at the online retailer to explore alternatives or to examine the detailed product information to fulfill their utilitarian needs (i.e. making right decisions) and/or intrinsic motivations (i.e. enjoy searching for more product info for itself).  Intention to recommend the online store to others. Positive word-of-mouth (WOM) for online retailers has been one of the most effective formats of advertising (Enos, 2001). It has been demonstrated that WOM has a significant effect on online behavioral intentions. Kuan and Bock (2007) found that WOM of the retailer’s online operations had the dominant effect on online trust and the effect was found to be much stronger than offline trust. Holloway et al. (2005) also revealed that consumers with a low level of online purchasing experience were more likely to engage in higher levels of negative word of mouth, if they felt dissatisfied after a service failure incident. Although there is little empirical research about a direct positive relationship between using the internet or an online retailer for information search and willingness to recommend to others,

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it is reasonable to expect that consumers who have greater search intention for product information via the online store are likely to have greater intention to recommend the online store to others, compared to ones who have lower search intention for product information via the online store. Subsequently, the more experience on information search consumers obtain, the more willing they would be, to recommend the online retailers to others. Therefore, we propose (Figure 1):  H6.

There is a positive relationship between consumer’s information search intention at the online retailer and their behavioral intention toward the online store.

Method Subjects A total of 262 undergraduate students in a large US Midwestern University volunteered to participate in this study. College students were selected for two reasons. From the practitioner’s perspective, these young adults are potential valuable customers for multi-channel retailers because they are likely to present strong purchase power on both online and offline stores (Hogg et al., 1998; Silverman, 2000). In addition, from the theoretical perspective, college students are generally accepted for model testing. Our major interest in this study is to build and test the sequential and multivariate relationships among variables (Calder et al., 1981).  Procedure We employed a self-administered survey technique to acquire consumer’s responses to the questionnaire. Respondents were first asked to recall their favorite traditional retailer that also operates an online store. They were then asked to identify and write the retailer’s name in the blank on the first page of the questionnaire. Next, respondents were asked to answer questions based upon their prior experiences with the chosen retailer.

Perceived confidence of  shopping at the online store  H1

 H5  H4

Figure 1. Proposed conceptual model explaining the mediating role of  perceived internet confidence in online shopping

Consumer trust in an offline store

Behavioral intention toward the online store

 H3

 H2

Information search intention at the online store

 H6 

 Instruments Three items were developed by the researchers to measure consumer trust in an offline store and had Cronbach’s a of 0.93. To measure perceived confidence of shopping at the online store, we adopted five items of the perceived confidence scale, developed by Eastin and LaRose (2000). The items had Cronbach’s a of 0.91. Information search intention via the online store was measured using three items, developed by Kim and Park (2005). The items had a Cronbach a of 0.90. To measure behavioral intention toward the online store, we adopted two items of willingness to purchase via the online store developed by Kim and Park (2005), one item of willingness to spend more time at the online retailer from Kim et al. (2007), and one item of willingness to recommend the online retailer to others from Zeithaml et al. (1996). The items had Cronbach a of 0.89. All except consumer trust in an offline store were revised to reflect the internet shopping context. According to Nunnally and Bernstein (1994), all multi-item scales used in the present study achieved acceptable construct reliabilities (Cronbach’s a . 0.7). A five-point Likert scale ranging from 1 (strongly disagree) to 5 (strongly agree) was used to measure the constructs. Multi-item scales for the model constructs are exhibited in the Table II with convergent validity test results and factor loadings. The model constructs had average variance extracted (AVE) values that ranged from 0.64 to 0.81, which are above the cut-off value of 0.50 (Fornell and Larcker, 1981). Therefore, all constructs achieved adequate convergent validity (Tables I and II). Respondents were asked to provide some demographic information including age, ethnic background, and sex. Respondents were also asked to select one favorite retailer who operates both offline and online channels and then, answer the questions related to their past shopping experience, such as the number of shopping trips for apparel purchase via the self-selected traditional retailer, the number of apparel purchases made in the past 12 months, and the amount of money spent in the self-selected traditional retailer for apparel purchase. The same questions were repeated for the online version of the retailer.

Perceived internet confidence 133

Results  Preliminary analyses The mean age of respondents ( n 261) was about 21 years. Approximately, 97 percent were between the ages of 18 and 25 years. About 80 percent were female. Thus, our sample is limited to female college students. This demographic group is, however, meaningful to investigate for apparel multi-channel retailers due to the strong ¼

Model constructs Consumer trust in an offline store Perceived Internet confidence shopping at the online store Search intention of product information via the online retailer Behavioral intention toward the online store Notes: * p , 0.05; * * p , 0.01

Correlations 2 3

Mean

SD

1

3.93

0.80

– 

3.89

0.95

0.29 * *

 – 

1.04 1.07

0.30 * * 0.26 * *

0.59 * * 0.72 * *

3.78 3.68

 –  0.66 * *

4

 – 

Table I. Descriptive statistics and correlation matrix of model constructs ( n 261) ¼

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134

Table II. Measurement model results for model constructs ( n 261) ¼

j 1 (consumer trust in an offline store)  x1 Offline store that I chose above would do the job right  x2 I trust the offline store that I chose above  x3 I believe that offline store that I chose above is trustworthy h 1 (perceived confidence of shopping at the online store) I feel confident. . .  y1 searching for apparel product information via this online store  y2 browsing apparel products via this online store  y3 making a purchase of apparel products via this online store  y4 making a payment transaction via this online store  y5 reporting my complaints about the purchase made from this online store h 2 (information search intention at the online store)  y6 I will visit this online store to search for apparel product information (e.g., new trend, product description) within six months  y7 I would be willing to search for apparel product information (e.g., new trend, product description) via this online store  y8 How likely is that you will search for apparel product information (e.g., new trend, product description) via this online store? h 3 (behavioral intentions toward the online store)  y9 I would be wiling to buy apparel through this online store y10 How likely is that you will buy apparel from this online store when you find something you like?  y11 I would spend more time shopping on this online store than I planned  y12 I would be willing to recommend this online store to my friends

Standardized factor loading ( l )

t -value

Average variance extracted a 0.81

0.83 0.96

–   19.83

0.91

19.02 0.64

0.83 0.76

–   16.69

0.92 0.80

17.96 14.82

0.70

12.31 0.76

0.79

– 

0.90

16.41

0.92

16.82 0.65

0.88

–  

0.82

16.95

0.75

14.58

0.76

14.60

Note: aAVE was calculated as suggested by Fornell and Larcker (1981)

consumer demand and buying power. According to the Youth/Harris Interactive College Explorer study, college students spent about US$200 billion per year and an average of US$287 a month on discretionary items other than tuition, books/school fees, etc. (“Harris Interactive” 2002). Female students tended to show higher fashion interest and spend more money on clothing than male students (Han et al., 1991). In addition, about 93 percent of college students accessed the internet (“Harris Interactive” 2002). The majority of respondents were Caucasian American (85.9 percent), followed by Asian heritage (8.8 percent) and African American (3.1 percent). More than 85 percent

of respondents had purchased a product over the internet and more than 71 percent reported their previous purchase experience of apparel on the internet. About 41 percent of respondents reported that they visited the self-selected offline store to search for clothing information in “every few month,” 24 percent reported “every month,” and another 21 percent reported “once or twice” in the past 12 months. About 42 percent of respondents reported that they purchased clothing from the self-selected offline store for 2-5 times, 21 percent reported 6-10 times, and another 21 percent reported more than 10 times in the past 12 months. The averaged amount of money that they spent on purchasing during the past 12 months was about $200. Less than half (46.1 percent) reported that they had searched clothing information from the self-selected online store for every few month (28.2 percent) or every month (17.9 percent) in the past 12 months. About a quarter (26.3 percent) reported that they purchased clothing from the self-selected online store for two to five times and 18.7 percent reported they purchased once. About 44 percent reported that they had not made any purchase for apparel via the online store. About 36 percent spent less than $200 on clothing purchase and 13.7 percent spent from $201 to 500 on clothing purchase. This is consistent with the previous findings about college students’ internet purchase behavior (Shop Org., 2003). Structural equation modeling analysis: hypotheses testing  Structural equation modeling was conducted to test the research hypotheses. AMOS 7.0 was utilized to run the analysis using a maximum-likelihood estimation. The overall fit indices for the proposed model revealed a x 2 of 153.43 (df  81; p 0.001), goodness-of-fit index (GFI) of 0.93, adjust GFI (AGFI) of 0.90, relative fit index (RFI) of  0.94, and RMR of 0.04. Fit statistics above 0.90 for GFI, AGFI, and RFI and below 0.05 for RMR were used as an indicator of a good model fit to the data (Bagozzi and Yi, 1988; Hair et al., 1998). Following Bagozzi and Yi (1988), the x 2 statistic was not considered a good indicator for model fit because sample size is over 200 in this study. Therefore, the indices indicated that the proposed model fit the data well. Figure 2 shows the final model with structural path coefficients and t -values for each relationship as well as squared multiple correlations (  R 2 ) for each endogenous construct. The results indicated that there were direct effects of: ¼

.

consumer trust in an offline retailer on perceived confidence of internet shopping (  H1: g 11 0.28, t  4.25, p , 0.001); and consumer trust in an offline retailer on information search intention via the online retailer (  H2 : g 21 0.17, t  3.04, p , 0.01). ¼

.

¼

¼

¼

¼

The H3 proposing the direct effect of consumer trust in an offline retailer on their behavioral intention toward the online retailer was not statistically supported (  H3: g 31 0.01, t  0.21, p , 0.83). H4 and H5  predicting the positive direct effects of  perceived confidence of shopping at the online store on information search intention at the online store (  H4: b  21 0.58, t  8.65, p , 0.001) and behavioral intention toward the online store (  H5 : b  31 0.59, t  9.19, p , 0.001) received statistical support. Finally, the results showed the statistical support for the proposed positive direct effect of information search intention via the online retailer on behavioral intention toward the online store (  H6 : b 32 0.37, t  6.00, p , 0.0001). Therefore, all hypotheses, except H3, were supported. ¼

¼

¼

¼

¼

¼

¼

¼

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 R2 = 0.08*

0.28*** (4.25)

136

Perceived confidence of  shopping at the online store

0.59*** (9.19)

0.58*** (8.65)

Consumer trust in an offline store

Behavioral intention toward the online store

0.01 (0.21)  R2 = 0.43*

0.17** (3.04)

Figure 2. A final model presenting structural path coefficients, t -values, and  R 2 for proposed hypotheses

Information search intention at the online store

 R2 = 0.76*

0.37*** (6.00)

n = 261 X2(81) = 153.43 GFI = 0.93 AGFI = 0.90 RFI = 0.94 RMR = 0.04 p = 0.001

Notes: Standardized path estimates are reported with t -values in parentheses. *  p < 0.05; ** p < 0.01; ***  p < 0.001

Discussion and implications The result of this study proved that consumer trust in an offline store was a significant predictor of perceived internet confidence and search intention for product information online offered by the offline retailer. At times consumers may feel uncertain about purchasing products online, if they need to give out their personal information such as credit card numbers. In this vulnerable situation, consumer’s trust of a company can play an important role in reducing any uncertainty that consumers have about online shopping (Chaudhuri and Holbrook, 2001). As we predicted, consumers’ trust in an offline store had a positive relationship with their perceived internet confidence. This information confirmed that consumers feel more confident with online shopping when they shop through the company they trust. As expected, consumers are likely to search information online using the trusted company’s web site. Consumers expect the company they trust to provide optimum information and eventually reduce their uncertainty of the online transactions as well (Lee and Johnson, 2002). Therefore, it is suggested that well-known brand name offline stores should maintain an up-to-dateweb site that is consistent with offline stores for consumers, in order to maintain consumers’ trust of their online store. However, the direct effect of  consumer trust in an offline retailer on their behavioral intention toward the online retailer was not supported in this study. This may suggest that consumer trust does not have a direct impact on the consumer’s behavioral intention but indirectly influences through perceived internet confidence and search intentions for product information online. This research demonstrates that increasing perceived confidence of shopping and increasing search intention at the online retailer result in an increasing behavioral intention toward the online retailer. A common problem in many online businesses is converting online browsers into online purchasers. By demonstrating the close relationship between consumers’ confidence in online shopping and behavioral

intention, this study gives an idea how to solve that problem. As our model shows, if  consumers trust an offline retailer, not only do they feel confident using their web site for searching information, but they also feel confident purchasing products from that retailer’s online store. Therefore, maintaining consumers’ trust both offline and online will be a key for retailers to turn online browsers into online purchasers. In order to retain consumers’ trust, retailers need to maintain smooth transactions from offline to online, and online to offline using a multi-channel retailing strategy. Consumers often search information online, and then may buy products online or in a physical store. Sometimes, consumers expect to return products in physical stores that were purchased online. At times consumers find products in physical stores, which they touch and physically handle, and then go home to buy products online. Therefore, it is vital for retailers to implement multi-channel retailing strategies seamlessly in order to offer customers the ability to purchase and return merchandise using any channel with a minimum amount of hassle, which will eventually cause consumers to retain their trust in the firm’s business and retail channels. One facet of our conceptualization of behavioral intention toward the online store was willingness to recommend the online store to others. This study shows that the more consumers feel confident with shopping at the online store, the higher behavioral intention will be toward the online store, indicating that consumers are more willing to recommend the online store to others. Online WOM is becoming an important marketing tool for retailers these days. According to Emergence Marketing (2007), online WOM is much more powerful than offline WOM because it affects many people over a short period of time. Consumers’ review of a retail firm’s products play an important role for other consumers’ purchase decisions. Therefore, it is suggested for retailers to adopt advanced technologies such as dynamic product image representation (i.e. Scene7e zoom function, My Virtual Model e ) and provide smart search engines for consumers to search for the product information conveniently. In that case, consumers will feel more confident searching information and purchasing products from the online store they trust and their trust in the retail firm will increase. A strong positive relationship between information search intention online and behavioral intention toward the online store found in this study and supports previous research. This indicates that consumers are integrating online shopping into their daily lives as they feel confident with online shopping. To increase online sales and consumer trust level, it would be vital for retailers to provide these online shoppers with what they seek at the online store in a timely fashion, because most online shoppers are goal-oriented (Wolfinbarger and Gilly, 2000). To fulfill theses online consumers’ needs, retailers need to provide accurate, detailed representation of product information and timely responsive customer service. In conclusion, our findings showed significant relationships between consumer trust in an offline retailer, perceived confidence of shopping at the online store, information search intention at the online store, and behavioral intentions toward the online retailer operated by the offline retailer in the multi-channel retailing context. In order to encourage offline purchasers to adopt the online channel for product information search and purchases, the multi-channel retailers should provide consistent customer service and product information throughout different channels. This study is not without limitations. First, this study employed a convenient sampling of college students to test the proposed conceptual model. Therefore, the

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findings may not be generalized to other populations. Future research may adopt a more representative sampling technique to replicate this study. Secondly, this study focused on apparel as a product category. It may be interesting to see how consumers perceive and behave in other product categories. Therefore, we suggest future studies to adopt different product categories to test the proposed conceptual model.

138 References

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