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EXCEL International Journal of Multidisciplinary Management Studies

Vol.2 Issue 3, March 2012, ISSN 2249 8834

Online available at


*Research Scholar, Freelance Report Writer,
Ex. Assistant Professor Emirates College of Management and
Information Technology (ECMIT), Dubai.

With the introduction of internet and e-commerce many companies have been performing their
business transactions through e portals such as C2B (Consumer to Business), B2C (Business to
Consumer) etc. Increasing technology changes has bought tremendous changes in online
business transactions and /or processes (buying and selling) and currently this process has
become common. Currently E-commerce portals are playing a vital role in online business and
here most consumers have varying opinions or views on online transactions especially security,
privacy and trust. Security and privacy are the two major aspects that drive online businesses
which leads online consumers to develop trust on the e-portals. This ultimately increases the
business processes. Thus the present study aims to discuss varying consumer perceptions on
privacy, security and trust on electronic commerce portals. Objectives include (i) Studying
consumer perceptions on varying characteristics of e-commerce portals, (ii) Study the various
factors that influence consumer trust and privacy on e-commerce portals, (iii) Identify the
antecedents and consequences of online consumers privacy concerns and (iv) Understand how
various security and privacy factors affect consumer perceptions towards e-commerce portal.
This paper is written based on extensive study done on past literature for the paper presented1 in
an international conference EBAA2. The literature review indicates that most participants are too
much concerned about the security and privacy issues while they are using e portals and security
is the main issue which creates a barrier for consumers in their online shopping. Further internet
privacy and security policies are vague and unclear and most of the consumers are not aware of
the technology used for the security of e portals.

E-commerce is an act involving an online transaction. It could be anything from ordering a

product or service online, paid content being delivered online sometimes, and financial
transactions such as payments to various services such as water, electricity, telephone, rail, road
and air services, movement of money from one account to another. The opportunities that arise
out of E-commerce are: E-learning, E-business, E-insurance, E-ticketing etc. The internet based
Research paper presented on Consumer perceptions on security, privacy and trust on e-commerce portals at
EBAA (Held on Nov 12 & 13, 2011) and has been awarded as the BEST PAPER of the seminar.
International conference on EBAA Economics and Business: Analysis and Applications, Dayalbhag
University, Agra.


KEYWORDS: Consumer perceptions, e-portals, privacy, security, trust.


EXCEL International Journal of Multidisciplinary Management Studies

Vol.2 Issue 3, March 2012, ISSN 2249 8834
Online available at

E-Commerce, besides its own major advantages, has some dis-advantages too coming with it.
These days, most of the web sites on the Internet are not focusing on the security, privacy and
trust concerns of the consumers; which is highly essential for an ongoing relationship with the
consumers. Most of the websites, unfortunately, are acting as online service catalogs providers
or catalog display centers. Their failure to convince the consumers on the security and safety of
their privacy issues is leading to failure of not being able to convert the clicks into closure of
deals. This is simply because they are not effective on their website on the safety, privacy and
trust related information as expected by the consumers of the present day. Therefore, here
security, privacy and trust are the major concern of any consumer. As more consumers are
slowly but steadily moving from regular shopping to the internet shopping environments these
aspects become very vital for the consumers.
The competition is on the increase in this highly advanced segment of marketing, both in number
and intensity. More number of websites or portals are offering their services/products with lot of
value additions and better quality. Selling of the services or goods, groceries, clothes, music,
travel, tickets, hardware, gifts, flowers, books are a part of the e-merchandise. Insurance, smart
cards, debit cards, financial services, credit cards, internet banking, banking machines etc., are a
part of the e-finance products. If any website seriously intends for retention of it existing
customers (in addition to attractive more number of new customers), they need to incorporate in
their marketing strategies the relationship paradigm (Hsu, Li-Chang & Wang, 2008; Walczack
et. al, 2006).
Utilization of the internet has become one of the important marketing channels and medium. In
this scenario, it is the responsibility of the Managers to efficiently manage the scarce marketing
resources under the purview of the internet channels in order to improve the sustainable customer
relationships. Every business entity needs to focus on the customers perception of improving the
security, in order to maintain long term relationship. This is an important aspect in view of the
fact that the customers depend on the internet for gathering the information as well as for
purchases online and become very loyal to the company or a particular brand of the product they
are interested in (Bart, 2005).

Designing of a website is one of the critical parts of internet marketing strategies as well in
addressing the security concerns of the customers/consumers. The characteristics that are
generally emphasized in the website categories are navigation, privacy and security (or the trust).
A website needs to be viewed as a virtual store from the consumers standpoint and needs to gain
customers trust in order to create a meaningful shopping experience. A consumers online
interaction through the website can be co-related to the experience at a store in person. Naturally,
consumers develop perceptions of trust basing on their website interaction and experience.
However, the trust of a consumer developed on the website depends on the extent of confidence
on the security and safety of the portal. Only basing on these factors the consumers perceptions
are formed either positive or otherwise. The level of satisfaction derived by a customer by a


EXCEL International Journal of Multidisciplinary Management Studies

Vol.2 Issue 3, March 2012, ISSN 2249 8834
Online available at

portal depends to a great extent on the authenticity and believability of the information offered
by a portal (Bart et. al., 2005).

Of late it has become customary on the part of every website to have a privacy statement
displayed prominently. This has become compulsory in view of increasing consumer perception
of their security and safety being at risk while transacting on the e-commerce portals. In order to
nullify the negative feelings of the consumers, privacy statements have been resorted to by the
owners of various e-commerce web portals. Seldom, the privacy statements on the websites
really try to protect the consumers from mis-utilization of their data and privacy. Mostly, they
exhibit the same as per the regulatory requirements. There is lot of ambiguity in these privacy
statement declarations, which are not clear in their terms and conditions and most of the time
they are vague, unclear and highly confusing. The consumers are really taken for a jolly good


Every individual has a right to retain the information of their own tax, medical and other
government related documents and this highly sensitive and personalized information is not
revealed by the hospitals/doctors, financial institutions, business parties or the government
agencies to irrelevant third parties. The Capitalistic societies are trading with the personal data as
a saleable commodity (Jan, 2005), resulting in the privacy and free market policies being at odds
with each other. Advanced data management technologies have resulted in sophisticated
Consumer database and management systems which in turn has become a fast growing and
highly profitable business activity by itself. Data stored digitally has an indefinite span of life;
because of which, consumers are apprehensive about their personal information being shared
with unintended third parties (Warren & Brandies, 1890). In the present day context, the rights
to privacy is directly conflicting with the freedom or the right to information being
implemented by various democratic societies (Udo, 2001). Protection of the individual personal
identifiable information is covered under the privacy. This is one of the major key drivers of
online trust. A person buying a system may not reveal so much of personal information as the
one who is travelling or even commuting. Traveler has to identify self, place of residence, place
of travel, date of travel and such other details which are of prime importance and need meant to
be disclosed to everyone specially those who are not relevant to the issue. Security relates to
the information revealed online such as credit card, debit card or the other financial related
information, used for purchase of goods and services (Hoffman, Novak & Tom, 1996; Peratla,
1999). The need for online trust is very high for website categories which require presentation
and navigation of information. The consumers may rely more on the brand strength of the
product/ portal, while searching the websites. Advice is also one of the stronger determinants of
online trust of website categories, for information on high search efforts. High involvement items
are generally associated with the issue of order fulfillment conditions. Community features are
very useful in trusting the information in cases where the expected sharing of the information in
unknown circles is very high. Consumers generally expect the website to be error free (such as
incorrect processing of information or the site containing wrong information) since they do not
accept information error on the websites as the information becomes the critical input for their
decisions making (Hoffman, Novak & Tom, 1996; Peratla, 1999).

EXCEL International Journal of Multidisciplinary Management Studies

Vol.2 Issue 3, March 2012, ISSN 2249 8834
Online available at

ride by these statements, which are prepared in the interest of the owners; not the consumers
(Jan, 2005).
Unfortunately, despite various regulatory authorities being in place, the companies are not
legally obliged to protect the consumers in true sense. It is up-to the consumers themselves to
protect their privacy by taking care and precaution while dealing with such e-commerce portals.
The consumer is expected to read the privacy statement in detail and take a decision accordingly,
whether or not to divulge the personal information through such web portals. Obviously,
consumers who are high users of internet services, while the occasional browsers of the internet
will be taking high risk in dealing with the e-commerce portals. The high users of internet
services have more awareness of privacy issues and hence will be very discrete in sharing their
personal information with the web portals (Miyazaki & Fernandez, 2000; Sheehan & Hoy;
2000). While participating in various online activities, consumers have always expressed their
serious concern as regards their privacy aspects. Various legislations have been made to improve
the privacy levels of the consumers. Unfortunately, such legislations have been misused by the
portals to their advance, for example had recently publicized their privacy police
statement without any notice to the consumers. As per this policy, could use (trade
with) the personal data of the consumers with out their consent. Every organization with internet
presence, cannot deny the fact that the privacy is the key factor the success of online transactions
(Miyazaki & Fernandez, 2000).

This is an effort by a group of companies having their online presence, to promote a third party
seal of approval system in order to counter the efforts of legislation of privacy policies by
various government authorities. Despite this seal of approval system being in force for couple of
decades now, discussions are still inconclusive as regards i) improving the online e-commerce
portals privacy related practices that are acceptable to the consumers as per their expectations.
ii) The extent of influence on consumers perceptions by such privacy policies and their
implementation. The so called seal of approval has very little or negligible impact on the
consumer perceptions on the believability; since the same has been carried out by an agency of
the e-commerce portal management / owners and not by a government or legalized authority. It
has been believed that it is not in the best interests of the consumers and it is only intended to
help the e-commerce portals to improve their business revenues by way of trying to influence the
consumers by giving a feeling of total privacy assurance. Even after having failed to convince
the consumers on a high note, the system of seal of approval is still continuing to be used in the
market place of e-commerce portals (Krishnamurthy & Sandeep, 2002)


Today business is done with many communication technologies such as mail order phone, mail
order fax, walk-in retail and so on. Web and internet are said to be another medium of

EXCEL International Journal of Multidisciplinary Management Studies

Vol.2 Issue 3, March 2012, ISSN 2249 8834
Online available at


Security is defined as the protection of data against accidental or intentional disclosure to
unauthorized persons, or unauthorized modification or destruction. Security is also defined as the
protection of data against accidental or intentional disclosure to unauthorized persons, or
unauthorized modifications or destruction. Privacy refers to the rights of individuals and

The other important feature of transaction is that in case of B2B the transactions are normally
unsecured but are despatched on VPP basis to ensure relaxation. However, in case of B2C the
transitions can be financial and the finance is limited to limit fixed by the buyer (Vallamsetty,
Kant and Mohapatra, 2003). According the survey conducted by Syncra Systems (2000) trading
exchanges has begun to transform business-to-business commerce. Trading exchanges aggregate
buyers and sellers in a vertical marketplace or across several interrelated marketplaces. Services
can range from providing on-line vendor product catalogues to procurement, bidder
qualification, financing, and commodity futures. So it can be said that trading exchanges are
expanding rapidly from an indirect procurement base. They are engaging into end-to-end ecommerce portals. There are reasons for the same: First, they will handle the full trading
lifecyclefrom procurement, to supply chain management, to customer relationship
managementspanning raw materials suppliers to consumers. Secondly the margin of profit will
be higher as the middle person will be removed (Syncra Systems, 2000). The trend of usage of ecommerce portals is exceeding the immediate capabilities. Though some of the writers are of the
opinion that B2C may not be bale replace the B2C, but it is proving worrying now as there are
now door to door advertisements by B2C clients who are opting for the same. The critical
success factor for an e-commerce portal is to attract enough transactions to become a market
player and get pricing power (Vallamsetty, Kant and Mohapatra, 2003).

communication (Vark, 1997). With the increasing demands of online customers the need of
scalable, fast, accurate and secured information exchange is very important. This creates trust in
online consumers. E-commerce is generally defined as a means for transactions of goods and
services through internet (some of these could be B2B, B2C etc.). E-commerce creates an
indirect access of the business products and services to the customers who intend to buy just
sitting at one place. This can be said as a more relaxed way of shopping (Akther, 2004). Eportals provide a wide range of products and services and if any customers intend to buy through
moving for shopping they have to move to different locations to get the same, so e-portals can be
said as one sit shopping. Vallamsetty, Kant and Mohapatra (2003) have conducted a research
study by collecting data through B2B and B2C. It was observed that there is similarity between
these two data. The internet users have increased the number of commerce transaction due to
mainly three reasons: it is easy to found out alternate suppliers with same equality a less cost,
secondly, value addition in the existing products, thirdly the buyer is not required to engage in
widow shopping. This business generated finance which increased form USD 29 to 150 Million
USD till previous year showing the importance of the clientele choice of e portal. One of the
most important factors is the base contractual agreement which takes care about the transaction
to be routed through. The distribution time is the major factor in these two cases. However, the
trend has changed and the suppliers used to have distributional channel in nearby areas as such
after ordering the consignment usually is deliver immediately.

EXCEL International Journal of Multidisciplinary Management Studies

Vol.2 Issue 3, March 2012, ISSN 2249 8834
Online available at

organizations to determine for themselves when, how, and to what extent information about them
is to be transmitted to others (Udo, 2001).
According to Hsu, Li-Chang & Wang (2008); Mc.Knight et. al. (2002) security is one of the
major and important factors of this relationship marketing. For a successful business relationship,
security is generally is considered as the crucial component in the relationship marketing
paradigm. Security is a mutual detriment of behavior and an indication of confidence in the
exchange partners integrity and its reliability. The importance of consumer perceptions on
security in e- portals has been stressed by many researchers and practitioners keeping in view
different perspectives such as social, economic, institutional, ethical, organizational, managerial,
and technological approaches (Chang et al., 2005, Moon, Gefen and Straub 2004), while
Jarvenpaa et al. (1999) and (2000) in their preceding studies have suggested importance of
consumer perceptions on security with respect to internet sites (online websites) and
comparatively some other studies were also investigated importance of B2B on consumer buying
behaviors and their varying expectations (Akhter, n.d). According to Miyazaki &
Fernandez (2000) online consumers purchasing behavior is affected due to concerns related to
security. Due to low consumer trust these concerns may raise high risk concerns or low buying
behavior. It is viewed (Akhter, n.d) that based on the experience online consumer
consciously or subconsciously analyze the security levels provided online and decide to continue
transactions with that particular business (company) or move to another. Technical and non
technical barriers in e-commerce have been discussed by Akhter (2004 & 2006), Tassabehji
(2003) and Turban et al., (2000) which are considered as barriers of online growth and
development. Some of the barriers are said as lack of security and reliability, standard
technologies for secure payment and proven online business models. Security is a major concern
to vendors in B2C as this reflects the consumer perceptions towards that business. As there is
uncertainty and due to many complications present in e-commerce online consumers think of
whether their financial information such as credit card are safe to send to a vendor through
internet (Akhter, 2006) and due to this most consumers fear to provide their credit card
information on internet to do any transaction. According to an argument done by Akhter (2004),
online consumer trust can be increased if e commerce or e portals can create a positive opinion
on the system that it is trustworthy and secure.

Trust is a fundamental principal of every business relationship. Trust is the critical factor in
stimulating purchase over internet (Corbit et. al., 2003). Most internet marketing sites lack trust
of consumer either in merchant honesty or competency. Thus trust plays a vital role on online
consumer activities there by leading to ecommerce success (Corbit et. al., 2003). Trust is said to
be characterized by uncertainty, reliability, dependency and venerability and these are reflected
on online transactions. According to Corbit et. al., (2003) in the relationship marketing paradigm,
trust is generally viewed as an essential ingredient for a successful relationship. Trust as a
willingness to rely on an exchange partner in whom one has confidence. Trust is the perception
of confidence in the exchange partners reliability and integrity. According to balance theory it
states that consumers tend to develop a positive towards those with whom they have prior
association. Greater the association, more the consumer experience, more is the positive attitude
developed towards e-commerce sites. Successful e-commerce websites are those that build trust


EXCEL International Journal of Multidisciplinary Management Studies

Vol.2 Issue 3, March 2012, ISSN 2249 8834
Online available at

in consumers and reduce the risk perceptions through effective technologies and marketing
activities. Some of the key drivers of online trust are security - privacy advice - brand
strength - fulfillment of order conditions features of the community error free transaction or
absence of errors of all these - Security and Privacy being of highest importance. The basic
human dignity calls for a right to be let alone or a right to total privacy. In the present day the
powerful media or the press has taken over to a new proportion. With the advancement of
information technology as well the rise of the information society, privacy levels have been
curtailed by the latest right to information acts being implemented by various governments
(Warren & Brandies, 1980).
According to Elgesem (1996) we can maintain our privacy by controlling the flow of information
about ourselves. This involves public knowledge about the way information is collected, the
ability to inspect and correct that information, assurances that information is being used as it is
intended to be, and assurances that information collection is justified in terms of the ends for
which it will be used. Currently, many situations involving data collection do not provide
consumers with the ability to choose whether or not to consent to the risk of revealing data (e.g.,
medical records). Because consumers must accept the obligatory risks that accompany
institutional information practices, it seems unjust for individuals to assume the costs of those
risks. Further Elgesem (1996) concluded that fair information management dictates that the costs
of relinquishing individual privacy not outweigh the reasons for which the consumer initially
chose to give up personal information.
Fair Information Practice Principles, which were adopted prior to the internet widespread, need
to be based for arriving at online privacy standards. These primary principles are as follows:

Access: provision of letting the consumers being able to view the accuracy as well as the
completeness of the data gathered from them by the e-commerce web portal. This enables
them to contest the same, if they so desire to do so.
Security: This is the major concern of any consumer. As the consumers are slowly but
steadily moving from physical shopping to the internet shopping environments. This
aspect only stops them from using the e-commerce portals, for the fear of its inadequate
security measures or the levels. As such, the role of Security in this kind of environment
is highly desirable form the consumers perception.

Choice: Consumers needs to be kept aware of - whether and how the personal
information provided by them online the portal, could be used, beyond the purposes for
which the information is provided by them to the e-commerce web portal. Here, the
consumers are not only alerted on the ways of utilizing the information, also their prior
consent is obtained in order to proceed further for intended purposes.

Notice: Disclosing the information practices by the Data Collectors (e-commerce web
portals) prior to the collecting of the personal information from the consumers. This
totally keeps the consumer aware of the practices being adopted by the web portal and
whatever decision is taken subsequently is at their own risk and security aspects.

EXCEL International Journal of Multidisciplinary Management Studies

Vol.2 Issue 3, March 2012, ISSN 2249 8834
Online available at

The data collectors or the e-commerce web based portals, need to assure the consumers that the
information collected on line from them is totally accurate, secure and will not be used for unauthorized purposes by the people, who are not supposed to be dealing with such data of the
consumers (Miyazaki & Fernandez 2000; Sheehan & Hoy, 2000). According to a 1999 report
from the USA Federal Trade Commission (1999a), information is gathered on the Internet both
directly and indirectly. When a user enters a chat room discussion, leaves a message on a bulletin
board, registers with a commercial site, enters a contest, or orders a product, he/ she directly and
knowingly sends information into cyberspace. The report further states that data can be gathered
indirectly, without the users knowledge. For example, a users travels around a Web site can be
tracked by a file called a ``cookie left on your computers hard drive on the users first visit to
that site. Because Web sites gather information directly and indirectly, they can accumulate a
complete data picture of an individual and his/her family (Federal Trade Commission, 1999).

Retreived from:
Altman, I. "Privacy Regulation: Culturally Universal or Culturally Specific?," Journal of Social
Issues (33:3) 1977, pp 66-84.
Laufer and Wolfe 1977 - Laufer, R.S., and Wolfe, M. "Privacy as a Concept and a Social Issue Multidimensional Developmental Theory," Journal of Social Issues (33:3) 1977, pp 22-42.

In the current globalized, information societies the increasing importance of privacy is been
widely discussed and is currently undisputed. Many researches and diverse works have been
conducted that helped the online consumers to understand the privacy at all the levels, individual
organizational and societal (Heng Xu, 2008). Privacy as a concept is in disarray. Nobody
can articulate what it means. Apart form which privacy has been described as
multidimensional, elastic, depending upon context, and dynamic in the sense that it varies with
life experience (Heng Xu, 20083). Further online privacy concerns (Dinev and Hart, 2004)
are been concerned as isolated efforts that are used to identify and discuss the factors that
influence the consumer privacy concerns. A conceptual framework was proposed by
Bandyopadhyay (2009) that explains the various factors that affect consumers online privacy

EXCEL International Journal of Multidisciplinary Management Studies

Vol.2 Issue 3, March 2012, ISSN 2249 8834
Online available at


AND RAO (2008)
According to Bandyopadhyay (2009) antecedent factors that affect consumers online privacy
concerns are discussed as

Perceived ability to control the release and use of private information - Perceived ability
to control is the extent to which consumers think that they can withhold personal
information from being disclosed online, which allows them to exercise their right to
privacy (Dinev and Hart, 2004). Notice, choice, access, security and redress are the five
major privacy policy principles identified by (FTC) Federal Trade Commission (Sheehan
and Hoy, 2000)
Characteristics of the consumers cultural background In the cultural context
characteristics such as masculinity, power distance, individualism, uncertainty avoidance
play a vital role in changing consumer perceptions towards privacy concerns.

Perceived vulnerability to information misuse - Perceived vulnerability refers to the

perceived potential risk when personal information is revealed. This can be caused by
factors such as hacking into networks, accidental disclosure, unauthorized access etc. this
ultimately can lead to consumers identity theft, undesirable consumer profiling etc. (Raab
and Bennett, 1998)

The former two factors discussed above are in turn influenced by social awareness and
consumers level of internet literacy. Apart form these Kim, Ferrin and Rao (2008) proposed four

EXCEL International Journal of Multidisciplinary Management Studies

Vol.2 Issue 3, March 2012, ISSN 2249 8834
Online available at

different categories of antecedents that influence the consumer trust and perceived risk towards e
portals and these are identified as
Cognition (observation)-based - These are based on the consumer perceptions and
observation in relation to the features and characteristics of trustee entity such as privacy
protection, security protection, system reliability, information quality, etc.
Affect-based - These are related to direct interaction with the trustee such as reputation,
presence of third-party seals, referral, recommendation, buyers' feedback, word-ofmouth, etc.
Experience-based These are related to personal experiences of the consumer with the
vendor and online shopping such as familiarity, Internet experience, e-commerce
experience, etc.
Personality-oriented - These are related to dispositional characteristics and shopping
habits of consumers such as disposition to trust, shopping style, etc
Based on the degree to which the consumers are worried about online privacy three major levels
of consequences are discussed Bandyopadhyay (2009) such as consumers unwillingness to
Reveal personal information online here online consumers refuse to reveal their
personal information on internet, so this results in browsing websites where personal
information is captured or required or sometimes even false personal information could
be given to use the context (Dinev and Hart, 2004).


Literature review indicates that most consumers were having differentiated perceptions in
relation to security and privacy. Considering the security, participants have varying responses
and this could be due to security related issues, too much concern of security as money was
involved in the transactions. Security was of moderate concern as they believe that internet sites
have been taking enough consideration related to security. Therefore attitude towards security is
seemed to be not based on the online shopping experiences. Next considering the privacy,


Use the internet altogether In extreme cases it is seen that consumers sometimes do not
show interest to use internet as they are ore concerned about the privacy and sometimes
consumers think that if they voluntarily enter the information, it could still exist in the
client computer and host server websites, so this could ultimately lead to less use of
internet or e transactions (Bandyopadhyay, 2009).

Enter into e-commerce transactions This could lead consumers not to use e portals for
making transactions as such transactions need disclosure of sensitive personal
information such as postal address, email, telephone numbers etc. (Dinev and Hart, 2004)

EXCEL International Journal of Multidisciplinary Management Studies

Vol.2 Issue 3, March 2012, ISSN 2249 8834
Online available at

consumers had wide range of perceptions as their personal information needs to be revealed
during online transactions. Most consumers are too much concern on the privacy of personal
information and were concerned of the privacy policies the websites followed and were very
keen to know the procedures. Despite of the privacy and security issues most consumers went for
online transactions. Based on this, the following sections will discuss the various factors that
affect the consumer perceptions towards security and privacy.
Technology of security: Most of the participants did not show much interest in
technology used for security. The log on pages is the first level of security and most of
the people are aware of this. When the participants are checked for the knowledge of
security systems they are unaware of them. Most of the participants know about the log
on page and few claims to be familiar with SSL, https, and encryption. Many people feel
that they have nothing to do with this, but some explain that encryption is for highest
level of security offered by the web site (Cheskin Research, 1999).

Third party endorsements: Independent third-party endorsements are more impressive in

recommending the site. Fraud protection of the site does grant credibility when it comes
from third party. Consumers focus on things that would happen if security of site was
breached rather than on its ability to prevent a breach and this would lack the ability to
determine whether the site is secured. An unfamiliar site can be transected when it is told
by a friend that it is trustworthy (Cheskin Research, 1999).


Importance of brand: The reputation and customer service of a company can be judged by
the participants response and also by maintaining the security of the site. The
participants gain confidence over a company by its reputation and their customer service
overtime. The privacy and security of a company is ensured with its policies and
practices. To maintain the companys brand the customer service is very important and
personal experience with the companys site would give them perception of security. To
maintain good relationship with the customers company should respond to their questions
through various means like e-mails, phone, etc; mistakes made by the company should be
rectified as soon as possible; the customers request for any information should be done
quickly. Participants experience while visiting the site would determine the reputation of
the company and their willingness to visit the site frequently builds trust in them (Turne,
Zavod and Yurcik, 2001).

Security measures: The first level of security, i.e., log on page is accepted by most
participants as it indicates that it cannot be accessed by everyone. Next about the
importance of password, most consumers know very well, but some say that they do not
follow these standards while using the net from home. Some people use the same
password for multiple sites and some will use the short and easy to remember passwords.
Sometimes they would not remember the password and so, the security system offers
them a facility to answer the questions that have used to register themselves in the site
and this would help them get their password. These measures would help to maintain the
privacy of ones site.

EXCEL International Journal of Multidisciplinary Management Studies

Vol.2 Issue 3, March 2012, ISSN 2249 8834
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Availability and reliability of site (Performance of site): The availability and reliability of
the company are the two most important aspects that would determine its performance. If
the site is down for a longer periods of time its security is questioned by the customers.
This has very bad impact on the customers as the service provided to the customer gets
delayed with this problem (Turne, Zavod and Yurcik, 2001).
Presentation of the site: According to customers site presentation is utmost important as
it includes the factors like presentation of available information, use of graphical
symbols, and the look and feel. The graphical symbol that is easily identifiable such as
MasterCard icon is more reliable. Some customers are not familiar with the TRUSTe
symbol which appears on several sites. The meaning of the symbol and the context in
which it appears is very important and not just the people reaction towards graphical
symbols. So, the symbol should accompany the text which would be easily understood by
the customers using that site (Cheskin Research, 1999).
Presentation of the site: Many customers do not bother to read privacy statements
completely. Some read only readable privacy polices that are brief. Some people think
that brief privacy polices do not really give the full information and would prefer reading
in detail. Some complain that the privacy polices are hard to read and interpret. None of
the participants would think that the companys privacy policy could change in the future.
Brand: The security of the participants is relied on companys reputation in protecting
their information. The customers are protected by law that regulates given industry
(Cheskin Research, 1999).


With the kind of negative consumer perception on the e-commerce trading and patronizing with
such portals, it becomes important on the part of the owners of such portals to attempt reducing
the consumers perceived security (risk) factors. One of such important measures could be the use
of seal of approval from a third party agency (Krishnamurthy & Sandeep, 2002). Attestation by
such third parties on the maintenance of security and privacy levels, may be believed by the
consumers, better than the ones issued by the own agencies of e-commerce portal managements.
This improved trust or the confidence level of the consumers, helps improving the online
transactions using the e-commerce portals. Secondly, the seal of approval can be treated as a cobranding strategy of a web based e-commerce portal aligning with a trusted third party agency
which ultimately leads to the gain of trust/confidence of the potential customers/consumers; as
they are assured of security by a neutral agency, which is in line with their expectations
(Krishnamurthy & Sandeep, 2002). One of the major responsibilities of online consumers is to
maintain the privacy. When they look for any e commerce site and intend to do any transactions
it is important for them to look for privacy statements of that site (Udo, 2001). According to
Udo (2001) sites in which privacy concerns are sensitive should clearly display privacy policies
and should offer the consumer to choose to share their personal information or restrict its use and


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Vol.2 Issue 3, March 2012, ISSN 2249 8834
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such sites should also state how to use the privacy policies. It is also suggested (Bandyopadhyay,
2009) that online privacy concerns could be reduced by
Increasing the consumers perceived ability to control the collection and use of sensitive
personal information
Perceived venerability has to be reduced towards information misuse and its
Adhere FTC guidelines for privacy policies and post prominent privacy policy on the
home pages
Increase social awareness of internet users that helps in increased ability to control
information and information misuse.
Convince the consumer through following fair procedurals of information collection
Increase the consumer trust in the company through legitimacy and display third party
privacy seals such as TRUSTe on their websites.
Vendors or online markets should see that they ask only the concerned information of the
consumer which is absolutely necessary and which does not affect the e commerce
Online markets should take the responsibility to educate their consumers about the
various options made available for them to protect personal information.


Further the literature states that most consumers believe that advancements in the encryption and
other security technologies are not sufficient to reduce the privacy and security concerns. Overall
this study stresses on the importance implementing effective security and privacy policies so as
to increase the consumer trust. Thus it is believed that such policies will increase consumer
awareness on e portals, reducing risk and liabilities and this in turn will develop trust in
consumers. In concluding this study indicates that there is a need of increased security and
privacy assurance and this responsibility has to be taken up by the e merchants and/or vendors,
government and should see that they give assurance to its customers that their security and
privacy is protected. Therefore this study indicates the increase importance of security and
privacy issues that needs to be resolved.

Finally marketers need to increase or decrease their efforts towards privacy concerns
keeping in mind the national cultural factors such as cultures with high privacy concerns
(in countries such as United States, Germany etc) and relatively low privacy concerns
cultures (in countries such as Japan, France, India etc).

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Vol.2 Issue 3, March 2012, ISSN 2249 8834
Online available at

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