Risk Reliever

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Perceived Risk and Risk-Relievers in

Online Travel Purchase Intentions
a a b
Pei-Jung Lin , Eleri Jones & Sheena Westwood
a
Cardiff School of Management , University of Wales Institute,
Cardiff , Cardiff, Wales, UK
b
College of Communication and Media Sciences , Zayed University ,
Abu Dhabi, UAE
Published online: 09 Oct 2009.
To cite this article: Pei-Jung Lin , Eleri Jones & Sheena Westwood (2009) Perceived Risk and Risk-
Relievers in Online Travel Purchase Intentions, Journal of Hospitality Marketing & Management, 18:8,
782-810, DOI: 10.1080/19368620903235803
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Journal of Hospitality Marketing & Management, 18:782–810, 2009
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ISSN: 1936-8623 print/1936-8631 online
DOI: 10.1080/19368620903235803
Perceived Risk and Risk-Relievers in Online

1936-8631
1936-8623
WHMM
Journal of Hospitality Marketing & Management,
Management Vol. 18, No. 8, August 2009: pp. 0–0
Travel Purchase Intentions
PEI-JUNG LIN and ELERI JONES

Perceived
P.-J. Lin et Risk
al. and Risk-Relievers
Cardiff School of Management, University of Wales Institute, Cardiff, Cardiff, Wales, UK
SHEENA WESTWOOD
Downloaded by [George Mason University] at 18:22 17 December 2014
College of Communication and Media Sciences, Zayed University, Abu Dhabi, UAE
Although the Internet offers numerous benefits, some consumers

are still reluctant to purchase travel products online due to per-
ceived risk. Travel products are associated with higher risk not
only because of their tangibility, but also because they typically
involve higher cost and complex choices. Additionally, the perceived
risk of purchasing travel products online is magnified by privacy
and risk involved. This study investigates perceived risk associated
with online travel purchasing by Taiwanese consumers with a special
focus on their reaction to risk-relievers provided on travel websites.
Data were collected through participant observation of the searching/
purchasing process of online travel products by the Taiwanese
consumers. The results show some risk-relievers are considered to
be more effective in reducing perceived risk related to online travel
purchase. Based on this finding, it is suggested that travel websites
should try and develop risk-relievers aimed at supporting consumers
in the prepurchase phase in order to reduce perceived risk, which
may lead to positive online travel purchasing intentions.
KEYWORDS Consumer perceived risk, risk-reliever, online travel

purchase intentions, Taiwan
INTRODUCTION
The Internet has had a major impact on the way in which travel products and
services are being marketed, distributed, and sold. It has also dramatically
Address correspondence to Eleri Jones, Cardiff School of Management, University of

Wales Institute, Cardiff, CF23 9XR, UK. E-mail: takefrenchleave@gmail.com
782
Perceived Risk and Risk-Relievers 783
changed the way that consumers search for travel information, make
travel decisions, and purchase travel goods and services. Characterized as
an information channel, the Internet is considered “a good fit” for travel
information searching and purchasing (Connolly, Olsen, & Moore, 1998,
p. 50). Indeed, travel products have among the most suitable for selling
online (Marcussen, 1999). According to Maser and Weiermair (1998, p. 107),
in travel and tourism, “information can be treated as one of the most, or
even the most, important factors influencing and determining consumer
behavior.” Money and Crotts (2003) noted that information collected in
the pre-purchase phase can be used to minimize risk and uncertainty
associated with travel purchase and maximize the perceived quality of travel
experience. Similarly, information gathered in the prepurchase phase
contributes to both the development of destination image (Kokolosalakis,

Bagnall, Selby, & Burns, 2006) and specific decisions, such as accommodation
and activity choice (Prentice, 2006). The Internet is therefore argued to
have profound impacts on consumer behavior in general and purchasing
decisions in particular.
The Internet has been seen to offer numerous benefits to potential con-
sumers seeking to purchase travel products online, including the richness
and depth of information; 24/7 availability; wider variety of product choices;
and cost savings (Buhalis, 2003). Despite these benefits, it seems that not all
Internet users searching for travel information eventually purchase online.
In other words, the number of “lookers” does not convert to an adequate
number of “bookers” (Morrison, Jing, O’Leary, & Cai, 2001). For example,
only about 1 in 6 Americans and about 4 in 10 Europeans purchase travel
products online (TIA, 2001). So although consumers recognize the benefits
of the Internet, they are still reluctant to make purchases online. The major
reason for consumer reluctance to purchase online lies in the perceived
risks (Tan, 1999; Miyazaki & Fernandez, 2001). Risk perception of the Internet
as a shopping environment is fuelled by the media and their reports on defi-
ciencies and cases of fraud. Various studies have suggested that purchasing
intention is negatively affected by perceived risk (Mitchell, Davies, Moutinho,
& Vassos, 1999; Miyazaki & Fernandez, 2001; Gefen, 2002). Specifically,
privacy and security risk have been found to be major concerns in terms of
online shopping (Phelps, D’Souza, & Nowak, 2001; Udo, 2001; Lloyd, 2003).
In the travel and tourism context, privacy and security issues also play a
significant role in inhibiting purchase of online travel services (Kolsaker,
Lee-Kelly, & Choy, 2004).
Although a number of studies (Bhatnagar, Misra, & Rao, 2000; Harridge-
March, 2006; Lieberman & Stashevsky, 2002; Kim, 2007; Lim, 2003; Tan,
1999) have discussed the effect of perceived risk in Internet context, very
little research has looked at perceived risk associated with online travel
shopping. One of the noticeable works was conducted by Kim, Kim, and
Leong (2005), examining the effect of perceived risk on purchase intentions
784 P.-J. Lin et al.
for airline tickets online. Seven dimensions of perceived risk (performance

risk, financial risk, physical risk, psychological risk, social risk, time risk,
and security risk) were used to measure consumers’ perceived risk in online
airline ticket purchase. Seven risk dimensions were all positively correlated
with one another, but negatively correlated with consumer purchasing
intentions. Specifically, the results indicated that performance risk and
financial risk were the predominant risks in explaining purchasing inten-
tions for airline ticket online. This study, however, fails to explain how to
resolve the consumers’ perceived risk in online travel purchases. In other
words, the study indicated that consumers’ perceived risk was negatively
correlated with online travel purchase intention, yet appropriate risk-relievers
were not identified.
Regardless of the shopping context, consumers exhibit uncertainty con-

cerning the match between their choices of products and their buying goals,
as well as the unfavorable consequences they may face if a mismatch occurs.
This uncertainty represents major elements of consumers’ perceived risk
involved in a purchasing decision (e.g. Bauer, 1960; Cox, 1967; Cunningham,
1967). In order to reduce perceived risk, consumers use various risk-relievers,
such as brand image or word-of-mouth, either to confirm their purchasing
decision or reduce the uncertainty they feel about the decision (Lutz &
Reilly, 1973). Previous studies have identified several risk-relievers that can
be used to minimize perceived risk (Roselius, 1971; Derbaix, 1983;
Greatorex & Mitchell, 1994). However, most of these studies have focused
on the risk-relievers utilized in the traditional shopping context, with very little
empirical work on the risk-relievers in online shopping contest, particularly
for online travel products.
Travel products are associated with higher risk not only because of
their intangibility, but also because they typically involve higher cost
and complex choices (Mitchell et al., 1999). In addition, the perceived
risk of purchasing travel products online is argued to be influenced the privacy
and security risk due to the uncertainty of online environment (Kolsaker
et al., 2004). Therefore, it is imperative for travel companies that want to
develop their web presence as well as increase travel sales, to under-
stand consumer risk perceptions associated with purchasing online
travel products and fully support them with appropriate risk-relievers on
the travel websites.
This research is exploratory in nature with the objective of providing
explanations that enhance our understanding of the role of perceived risk
and risk relievers provided in online travel websites, which is argued to
have impacts on online travel purchase intentions. Previous research has
addressed the issue of perceived risk and Internet shopping behavior in
general, but it has not addressed how perceived risk might be minimized by
risk-relievers provided on the websites, particularly in the context of online
travel purchase.
LITERATURE REVIEW
Perceived Risk
Consumer perceived risk has been widely studied in marketing and con-
sumer behavior literature since Bauer first introduced the concept in 1960
(e.g. Bauer, 1960; Cunningham, 1967; Bettman, 1973; Mitchell, 1999). Perceived
risk is a function of two components: “uncertainty” and “consequence”
(Bauer, 1960). Uncertainty is related to the identification of buying goals or
the process of matching goals with purchasing decisions. Consequence is
related to functional, performance, or psychological goals and the money,
time, and effort invested to achieve those goals (e.g. Bauer, 1960; Cunningham,
1967).
Perceived risk is viewed as a multidimensional construct. Several dimen-

sions of perceived risk have been identified (Roselius, 1971; Jacoby & Kaplan,
1972).
1. Financial risk refers to value for money as well as how much money will
be wasted or lost if the product does not perform well (Garner & Garner,
1985);
2. Performance risk focuses on products not performing as desired (Jacoby
& Kaplan,1972; Kaplan, Szybillo, & Jacoby, 1974; Peter & Ryan, 1976);
3. Psychological risk is disappointment in oneself at not making a good
product choice or its not fitting one’s self-image (Roselius, 1971; Jacoby &
Kaplan, 1972);
4. Social risk relates to other people’s negative thoughts if a poor product
choice is made (Garner, 1986);
5. Physical risk relates to potential safety problems while using the product,
(Derbaix,1983);
6. Time risk is related to the amount of time required to purchase the prod-
ucts as well as the time lost as a result of product failure (Peter & Ryan,
1976).
The relative importance of the various risk dimensions need not necessarily
be the same across purchasing decisions because some risk aspects will be
more prevalent in a particular purchasing situation. For example, psycho-
logical or social risk is higher in relation to a hair cut because of the social
visibility, whereas the likelihood of physical risk is low. On contrast, time
and financial risks are high for banking service.
These dimensions of perceived risk have been identified essentially in
relation to the purchase of a product without necessarily considering the
context of the purchase. However, several studies suggested that consumers
have different risk perceptions for different shopping modes. For example,
compared to shopping in a retail store, consumers perceive higher risk when
purchasing products by mail (Spence, Engel, & Blackwell, 1970). Similarly,
Cox and Rich (1964) noted that people perceive higher risk for telephone
shopping than in-store shopping because it does not afford consumers
opportunity to touch or try a product prepurchase. It is therefore reasonable
to argue the risk levels associated with online shopping might also be
magnified.
PERCEIVED RISK OF BUYING ONLINE TRAVEL PRODUCTS
When considering the perceived risk associated with online shopping, three
potential risk sources are proposed: risk associated with the product itself;
risk associated with the Internet as the purchase mode; and risk associated
with the site on which the transaction is made. There have been many
attempts to investigate the consumers’ perceived risk in online context, with
one of the notable work by Jarvenpaa and Todd (1997). They suggested
that several perceived risks are associated with online shopping: economic
risk, social risk, performance risk, security risk, and privacy risk. The last
two risk dimensions, not proposed in the literature on traditional shopping,
seem to be particularly related to Internet transactions (McCorkle, 1990).
Security risk relates to the fear of giving one’s credit card detail online while
privacy risk relates to the consumers’ fear that personal information will be
collected without their knowledge. Some researchers claim that privacy
concerns inhibit online shopping (Miyazaki & Fernandez, 2001; Phelps et
al., 2001; Kolsaker et al., 2004) while security risk has been identified as the
main reason why consumers feel reluctant to purchase online (Harrison-
Walker, 2002). It can be argued that the appearance of new forms of risk
associated with the Internet, and more studies are needed to better under-
stand the different potential sources of risk involved in making a purchase
online, and to clarify the different risk dimensions that result from it.
Perceived risk can be associated not only with the situation in which
the object has acquired, but also to the object itself (McCorkle, 1990). Travel
products are characterized by their intangibility, which makes it difficult,
sometimes impossible, to evaluate the product prepurchase. Additionally,
travel products are also characterized by the inseparability of production
and consumption (Mitchell & Greatorex, 1993). Travel product purchase
therefore associated with a higher perceived risk than tangible product pur-
chase, e.g. computers.
According to Moutinho (1987), several risk dimensions (performance
risk, financial risk, psychological risk, physical risk, and social risk) are
related to planning and purchasing of travel products. Additionally, perceived
risk of buying travel products online is also argued to be influenced due to
privacy and security risks involved because of the uncertainty of the Internet
as the shopping mode (Kolsaker et al, 2004). Some researchers (Beatty &
Smith, 1987; Dowling & Staelin, 1994) suggested that consumers’ need to
search for external information (i.e. sources of information other than con-
sumers’ own knowledge and experience) is higher in high-risk situations
than in low-risk situations. Due to the higher risk involved in purchasing
travel products online, the use of external information to reduce perceived
risk is assumed to be evident. It is therefore can be argued that various
types of risk-relievers should be provided on travel websites reduce per-
ceived risk, which in turn may positively affect consumers’ online travel
product purchasing intentions (Gefen, 2002; Mitchell et al., 1999).
RISK-RELIEVERS
Roselius (1971) identified a risk-reliever as any action initiated by a buyer or

seller and used as a strategy for reducing perceived risk. Traditionally, it has
been accepted that there is a positive relationship between the risk per-
ceived by consumers and risk-relievers, i.e. the more risk is perceived, the
more risk-relievers the consumers require. Since perceived risk is seen to
have uncertainty and consequence components (Bauer, 1960; Cunningham,
1967), it follows that perceived risk might be reduced to a “tolerable” level
by either or both of the following strategies: increasing the degree of cer-
tainty that the loss will not occur; reducing the consequence of failure.
In an attempt to reduce perceived risk, researchers have proposed var-
ious risk-relievers. Roselius’ work (1971) has been the starting point for
many studies related to risk-relievers. He identified several risk-relievers
including endorsements, brand loyalty, private testing, brand image, store
image, free sample, money-back guarantee, shopping, expensive model,
and word-of-mouth. Derbaix (1983) suggested his own supplementary strategy
to reduce perceived risk—the advice of a salesperson. Similarly, Greaterox
and Mitchell (1994) also proposed some risk-relievers, such as purchasing a
cheaper brand, special offers, information on a package, and consumer
magazines. It is noted that the majority of risk-relievers act to increase the
certainty that the product will be satisfactory rather than reduce the conse-
quence of failure. In other words, attention was paid to improve the effec-
tiveness of risk-relievers prepurchase.
It is noted that two studies specifically account for online shopping
contexts in analyzing risk-reliever preferences, i.e. Tan (1999) and Van den
Poel and Leunis (1999). It seems that apart from payment security (specific
to the Internet), the other risk-relievers are not very different from those
classically identified for traditional shopping contexts. In other words, some
of the risk-relievers noted in store purchasing are equally suited to online
shopping contexts. It can be argued that the nature of the risk-reliever is
preserved even if the mode of expression is modified. Specifically, online
communities provided on some websites constitute a form of word-of-mouth
specific to this relatively new medium though it has been extensively used
as risk-reliever in traditional shopping context. This implies that the con-

sumers, when purchasing, need advice from others—friends, family or fellow
travelers in online travel communities.
Since the aim of this research is to explore risk-relievers provided on
travel websites, it will take into account the decision-making context and
the extra information required for the purchasing decision. Several con-
sumer purchasing models have been developed (e.g. Howard & Sheth,
1969; Engel, Blackwell, & Kollat, 1978) which vary in detail but agree on
five key stages: three prepurchase (problem recognition; information
search; evaluation of alternatives) plus purchase decision and postpurchase
behavior. The three prepurchase stages will be focus on this research.
The rationale for researching the pre-purchase phase of online travel
shopping is essentially related to the characteristics of travel products

themselves. Due to their intangibility, they are very difficult to evaluate
prepurchase (e.g. booking a hotel room in foreign country). Additionally,
the inseparability of production and consumption means that travel ser-
vices are generally impossible to return. The prepurchase phase is there-
fore extremely important and information gathered during this phase can
significantly contribute to decision making, such as accommodation and
activity choice (Prentice, 2006). It is can therefore be argued that risk-
relievers on travel websites during prepurchase phase can have significant
impact on prepurchase.
RISK- RELIEVERS PROVIDED ON TRAVEL WEBSITES
In line with Roselius’ (1971) definition, risk-relievers provided on a travel

website will be understood here as strategies employed on travel websites
to reduce perceived risk to a level low enough for consumers to decide to
purchase the products. Previous research (Blackwell, Miniard, & Engel, 2001;
Fogg, 2002; Koernig, 2003; Kolsaker et al., 2004; Miyazaki & Fernandez 2000;
Nysveen & Lexhagen, 2001; Öorni & Klein, 2003) has discussed several
strategies that can be provided on travel websites, including security label,
privacy policy, contact information, search engine, links, travel communities,
and use of photos.
Security Label
Security issues have been, and still are, concerns for online shopping.
According to Yoon (2002), the security issue in online shopping is one of
the most important antecedents of purchasing intention. Some researchers
(Weber & Roehl, 1999; Kolsaker et al., 2004) have indicated that the most
frequently-cited reasons for not purchasing travel products online relates to
credit card security.
Given the online marketplace is relatively new and most travel websites
have not established good track records, consumers often rely on security
label, such as Verisign, to verify the credentials of online travel websites.
Typically, operators of security label programs advocate a set of standards
and principles that concern consumers, e.g. security and reliability, which
are applied by travel websites. After verification by the security label operator,
travel websites can display the label to signal conformance to the label’s
standards and principles. Miyazaki and Fernandez (2000) suggested that the
security labels provided on the website can reduce perceived risk and have
a positive impact on consumers’ purchasing intentions.
Privacy Policy
Privacy issues have received significant attention in direct marketing
literature (Petrison & Wang, 1995; Korgaonkar & Wolin, 1999; Sheehan &
Hoy, 1999), and threats to privacy concern many consumers (Lloyd, 2003),
especially in relation to the Internet (Bart, Shankar, Sultan, & Urban, 2005).
Privacy concerns may significantly inhibit purchase travel products online
(Kolsaker et al., 2004).
Three issues identified in direct marketing literature as of great con-
cern to consumers include unauthorized secondary use of data, invasion of
privacy, and errors (Nowak & Phelps, 1992; Petrison & Wang, 1995). An
increase in online shopping leads to more personal information floating in
cyberspace (Carroll, 1999). Given global events since September 11, 2001,
it has been suggested that the travel industry is at the forefront of threats
to consumer privacy with more data being collected than ever before.
Privacy policies that describe what personal information will be collected
and how it will be used are therefore recommended to be displayed on
travel websites to reduce perceived risk associated with online privacy.
Contact Information
Contact information refers to the physical address, telephone and fax numbers,
and e-mail address of the travel business (Nysveen & Lexhagen, 2001). The
provision of contact information gives the consumers opportunity to make
contact with the company behind the travel website to clarify some ques-
tions or issues arising during the search and purchase process. It therefore
can be argued that the provision of contact information contributes to
reduction of perceived risk related to purchasing online travel products.
This function of risk-relievers may be particularly relevant for consumers
with little experience of online purchase. Contact information should be
clearly presented on the home page to save the consumers’ time, and thus
increase the likelihood of satisfactory purchase.
Search Engines
Search engines help consumers locate specific pages that are relevant to the
information they are looking for (Laudon & Laudon, 1998). This is particularly
relevant for users with limited experience of online travel purchase, who thus
find it difficult to start searching. By using search engines, consumers can
reduce the search time associated with finding the relevant information and
generate higher satisfaction due to the availability of alternatives (Moutinho,
1987); the more relevant information consumers possess, the more likely
the perceived risk will be reduced.
Links
Links (hyperlinks) are a method of moving between websites (Chaffey,

Mayer, Johnstone, & Ellis-Chadwisk, 2003). Links are thought to provide
access to relevant information and services available at other sites to assist
consumers in their search for and purchase of travel products. Although the
Internet simplifies the search process, locating suitable sellers and travel
products can be more difficult than previously believed (Öorni & Klein,
2003). Locating suitable products is even difficult for users with little online
travel purchasing experience. It can therefore be argued that links to other
relevant websites can provide complementary information and thus save
time and effort spent by consumers, which in turn increases the likelihood
of satisfactory purchase.
Travel Community
The travel community gives Internet users the opportunity to communicate
with other users. Internet users can share experiences, ask questions, and
read answers from people who have visited the destination or purchased
the products online. The travel communities are an online forum for word-
of-mouth, which is widely recognized as an important and trustworthy
information source (Blackwell et al., 2001). This extra information helps con-
sumers make decisions regarding purchases, and thus gives consumers more
control over the purchasing process (Murray, 1991). This may be particularly
relevant for consumers with little experience as they perceive higher risk
associated with online purchase due to lack of information (Havlena &
DeSarbo, 1991). It is therefore argued that online travel communities contrib-
ute to risk reduction associated with purchasing online travel products.
Use of Pictures
Pictures can be used to overcome issues associated with intangibility and
heterogeneity of travel products (O’Connor, 1999; Koernig, 2003). Leong,
Meng, Swee, & Tham (1996) suggested that pictures are more memorable
and easier than text for creating an image about a product/service in the
consumers’ mind. Clearly there are expectations that information on web-
sites is not only useful but also well presented and attractive (Hinton, 1998).
In computer-mediated environments, such as the Internet, pictures add tan-
gible cues, enable consumers to virtually experience the products, and
familiarize them with the company’s products and services (Krentler & Guil-
tinan, 1984; Berry & Clark, 1986; Li, Daugherty, & Biocca, 2001; Koernig,
2003). For example, a variety of pictures of a hotel (e.g., bedrooms, lobby, res-
taurant, and other areas) increase tangible cues for consumers and provide
vivid images which subsequently evoke more positive attitudes and pur-
chasing intentions (Koernig, 2003).
The use of pictures not only relates to the presentation of travel prod-
ucts and services, but also applies to images of people which have widely
been used in advertising to create positive attitudes towards products and
brands. In a face-to-face situation, direct contact with the salesperson pro-
vides the consumers with important cues to establish trust (e.g. eye contact
and gestures), stabilize the relationship, and enhance verbal communication.
These features are assumed to be crucial for mediating personal contacts
(Goffman, 1972). However, computer-mediated environments lack most of
these trust-building features. Therefore, adding social cues to a website can
potentially increase consumer trust in online vendors. For example, Fogg
(2002) noted that photos of authors can increase the credibility of online
articles and Steinbrueck, Schaumburg, Duda, and Krueger (2002) found
that a picture of an employee on the homepage of an online bank signifi-
cantly increased user trust. It is therefore argued that pictures provided on
travel websites are likely to add tangible cues, enable consumers to obtain
virtual experience of the products beforehand, and thus reduce perceived
risks associated with purchasing online travel products.
METHODS
Research Design
The research was primarily qualitative in nature since its main aim was to
uncover people’s views and experiences rather than reflect objectively an a
priori reality. The research was a study of real experiences concerning
online travel purchasing behavior, the principal method being observation.
Perceived risk is a markedly task-specific phenomenon which requires the
purchasing scenario to be controlled. Ideally, subjects should be going
through the prepurchase decision process—in this study, the searching/
purchasing processes for travel products online. The main rationale for
using observation is that this method enables a deeper understanding into the
behavior, motivation, and attitudes of the individuals under study (Veal, 1997).
In addition, observation also provides rich, detailed, context-specific descrip-

tions, which are close to the insider’s perspective (Sackmann, 1991). By
observing consumers making travel purchase on the Internet, the patterns
of online searching/purchasing behavior could be identified.
Sampling and Data Collection

A purposive sample of informants were recruited through an informant-
controlled card system, whereby preprinted postcards requesting participant’s
preferred contact details and a return address were distributed through the
researcher’s social network; upon receipt, a mutually convenient interview
was arranged. A total of 12 observations were conducted yielding rich infor-

mation on online travel purchasing experiences. Participants varied from
novice to expert, with online travel purchasing experience ranging from none
to more than 10 times in the last 12 months. Table 1 summarizes the online
purchasing experiences (including purchasing online travel products) of
participants.
It was noted that even participants who never purchase online travel
products showed interest in browsing travel information online. The reason
given by these participants for not purchasing travel products online was
that they have friends working as travel agents, which could provide help in
terms of purchasing discounted products. Even with the assistance of
friends, they still showed interest in looking for travel information online.
They also stated that they would consider purchasing online travel products
which were not available via their friends.
Each observation involved one participant and lasted about two hours.
The participants were asked to search package holiday at a foreign country
of their choice. They were free to start searching by using keyword on a
search engine or go directly to the travel websites which they were familiar
with. No limit was set in terms of the types of travel websites that partici-
pants can visit. For example, websites operated by hotels and/or airlines
were all included. They were instructed to go through the entire searching
and purchasing process up to but excluding the clicking of the buy button
to purchase the product. During these processes, participants were asked to
express their feelings and opinions verbally about what were experiencing
TABLE 1 Summary of the Online Purchasing Experiences

of Participants
Once purchased Once purchased

products online travel products online
Yes Nine Eight

No Three Four
towards travel websites they visited. Particularly, they were asked to point
out particular aspects associated with risks and commented on the effectiveness
of the risk-relievers provided on the travel websites visited. All observations
were tape recorded for accurate transcription and capture of the participants’
exact vocabulary and phrasing. In addition, some participants spontaneously
followed up interviews with e-mails, stressing additional points stimulated
by the interview process. This feedback allowed the research to further
refine the findings of observation.
RESULTS AND DISCUSSION

To increase the likelihood of consumers being satisfied with the services

provided on the websites during the search and purchase process, and there-
fore increase the possibility of the consumers actually purchasing the prod-
ucts, the travel companies should understand consumers’ risk perception and
fully support them with appropriate risk-relievers on travel websites. This sec-
tion presents the results of observation that concerns risk-relievers perceived
by consumers while searching for and purchasing online travel products.
Security Label
An example of security labels provided on a travel website is presented in
Figure 1.
Surprisingly, the majority of interviewees claimed that they were comfort-
able with paying online by credit card if the website is recommended by
family and friends:
I normally buy from websites recommended by friends and so I am confi-

dent paying online by credit cards. Knowing other people have the similar
experience buying form [sic] the same website gives me a peace of mind.
Similarly, previous positive online purchasing experience also contributes to

the confidence of paying online by credit card:
It is ok for me to pay online by credit card. I have done this for so many
times, and nothing bothers at all. This positive experience increases my
confidence of paying online by credit cards.
It is interesting to note that although the interviewees were relatively

comfortable with making payments online by credit card, they tended to
make phone calls before deciding whether to pay online or not. The posi-
tive experience of customer service seems to have certain influence on their
decision.
An example of provision of
security label
FIGURE 1 Security label.
I feel comfortable making payment online by credit card after talking

with customer service staff. If the person I was talking [with] seems to be
caring and responsive. I would be happy to pay online.
I make phone calls to ask about payment procedure. If I am satisfied

with the assistance provided, I am confident with paying online as it is a
very convenient way.
Although some felt confident with paying online by credit card, others
were wary of the negative consequences, such as fraud.
I bought books from amazon.com a few times, paying by credit card. I

only feel comfortable buying from well-known online websites.
One participant confirmed that security labels posted on the websites were
likely to boost his confidence to pay online by credit card.
I feel confident paying online when seeing a security label posted. I

suppose this means my purchase in this website is protected by law and
regulations.
It seems that the majority of the participants did not emphasize the impor-
tance of a security label as a major factor concerning online payment. Although
this result does not fully support the work of Miyazaki and Fernandez
(2000), which suggested that security labels reduce perceived risk, participants
were clearly concerned with the aspect of security. It appeared that Taiwanese
consumers did not particularly look for security labels while searching
online, yet the influence of positive interactions with customer service staff
seems play a more important role in reducing risk of paying online than the
presence of security labels.
Privacy Policy
An example of privacy policy provided on a travel website is presented in
Figure 2.
privacy policy
FIGURE 2 Privacy policy.

Surprisingly, some participants have low awareness of privacy policy

and some even doubted the effectiveness of such strategy:
I normally do not pay attention to see if any privacy policy is posed on

the website. I have no idea what does that mean exactly?
I know some websites tend to post privacy policy, especially some web-
sites with big company behind. My question is if they really follow what
they say?
The privacy risk caused by revealing personal detail online has been frequently
mentioned as one of major barriers perceived by potential customers in
western countries (Lloyd, 2003; Bart et al., 2005), yet the Taiwanese consumers
seemed to pay little attention to this aspect. One of the possible explana-
tions may be that they have low awareness of such policies as assurance of
privacy protection.
Contact Information
An example of contact information provided on a travel website is presented
in Figure 3.
Participants confirmed the significance of contact information and the
need for reassurance of physical contact:
I want to talk to customer service staff if I have questions about the

information presented on the website. Their phone number should be
shown on the homepage.
The contact information should be easy to find. It should not be hidden

on lower pages. It should be clearly shown on homepage. This informa-
tion gives me piece of mind.
More importantly, one participant pointed out that positive interaction with a
customer service person may contribute to the increase of purchase intention:
I tend to make phone call when I have question about the information
presented. If I feel the customer service person is responsive and caring,
I would be happy to make a purchase.
Participants also revealed contact information can be used to confirm the

reservation as soon as the booking is made. Particularly, they want to make
phone call if significant amounts of money are involved (e.g. buying package
holidays):
contact information
FIGURE 3 Contact information.
I always make phone call to make sure if the payment is ok. This gives
me a piece of mind. Confirmation by email is enough for a small
amount of money (e.g. flight ticket), but it would be great if I can make
phone call to confirm the payment when large amount of money is
involved.
It is interesting to note that some participants revealed the physical address

of the travel company can be used as an evidence to judge the credibility of
the travel website:
I want to visit travel agent by myself to make payment. Therefore, it is

important that they provide physical address. I want to see the company
behind the website, especially the one without high-street presence.
Physical address gives me a real-world feel. It makes me feel the travel

company does not only exist in the virtual world of Internet. If I cannot
find contact information, especially address, of the company, I would
not buy from this website.
It seems e-mail addresses are not considered essential:
I suppose it will take a while for my questions to be answered by e-mail

request. Therefore, I do not think I will use this way of communication.
This result supports the research of Weeks and Crouch (1999) and Nysveen
and Lexhagen (2001). It suggests that consumers would prefer instant and
direct contact with travel companies when assistance is required. Although e-
mail addresses are not considered as important as other contact methods,
they should be provided for consumers who may prefer to use email for
making requests if the case is not urgent.
Search Engine
An example of a search engine provided on a travel website is presented in
Figure 4.
Search engines were perceived to be associated with time saving by
some participants:
search engine
FIGURE 4 Search engine.

I like to use the search engine. It helps me find information in a very quick
way. It is a good way to save time needed in travel information search.
The search engine is particularly useful for users with limited experiences of
online travel products searching and purchasing:
I am not familiar with buying travel online. I sometimes have no idea

how to find the information I want. If search engine is provided, it will
help to solve this problem.
The result supports the claims that search engines give consumers better
support (Rappoport, 2000). Although they are considered important, search
engines are not provided in all Taiwanese travel websites which participants
visited, especially travel websites with a narrow range of products.
Links
An example of useful links provided on a travel website is presented in Figure 5.
An example of
provision of links
FIGURE 5 Links.
Participants confirmed the significance of relevant links provided and indi-

cated that detailed information helped to increase knowledge on the travel
products they intended to purchase:
The more detailed the information, the more helpful it will be. The
travel websites should provide relevant links about products they sell.
For example, links to the hotel websites. By this way, I can see more
photos on rooms, amenities, and location of the hotel. This information
helps me to make purchase decision.
In particular, one participant stressed the provision of relevant links may

increase consumer satisfaction towards the travel websites:
As far as holiday package product is concerned, the links to official

tourist website of destination would be very helpful. This can help
me to know more about the local culture, attractions, and event on
destination I intend to visit. This service increases my satisfaction
about the travel website because I think the company pays attention
to consumers’ need.
However, the currency of the links is crucial and may have an impact
on consumers’ perception towards travel websites:
Of course, travel websites should add relevant links in order to provide

detailed information. But I sometimes find the links which provided are
invalid or not very relevant to the products. This really is an issue they
should pay attention to.
I found some links provided by the travel websites were no longer

in use. If this happened very often, I doubt if attention was ever
paid to updating the other content of information provided on the
website.
The result supports that relevant links provided on travel websites assist
consumers in the search for and purchasing of travel products (Öorni &
Klein, 2003). It should be noted, however, that the links must be inspected
regularly by the web managers to remove defunct links which cause nega-
tive perceptions of travel websites.
Travel Community
An example of a travel community provided on a travel website is presented in
Figure 6.
One participant felt safe to purchase from the websites recommended
by other online members:
An example of provision
of travel community
FIGURE 6 Travel community.
I want to know people with the experience of buying from this website.
This will give me a peace of mind. Their opinions can help me to make
decision about whether or not to buy from this website.
Another participant pointed out that the opinions provided by online members
seemed neutral, and hence likely to have an impact on purchase intentions:
I always visit the travel community to get advice from experienced travelers
about traveling to a certain destination as well as buying from a particular
website. Their opinion is neutral, unlike commercial you see on brochures.
Their opinion has great influence on my purchasing decision making process.
This result supports the claims of Nelson (1974), who noted for experience
products (products that have to be experienced before they can be evalu-
ated), e.g. travel products, word-of-mouth has been shown to be an impor-
tant influence on consumers’ purchasing decision. The results were also
consistent with the survey conducted by Preece (2000), who stressed that
the information provided through travel communities can help consumers
make decisions. Information from other users (word-of-mouth) is often
An example of use
of photos
FIGURE 7 Use of photos.
perceived as more neutral and trustworthy than information presented by

the travel websites in advertising campaigns or on websites.
Use of Pictures
An example of proper use of pictures on a travel website is presented in Figure 7.
Participants confirmed the significance of and indicated that quality
of pictures is particularly important:
It is more appealing to me if several photos associated with destination

are shown along with text. Photos are very important when it comes to
buy travel products. The travel websites should provide not only photos,
but good quality ones, in order to draw attention of the online customers.
Comparing two websites providing with and without pictures on the

holiday products, I would be more interested in using the one with photos.
Pictures make the travel products look more appealing.
These comments correspond with Koernig (2003), who suggested that the
provision of pictures increases tangible cues and provides vivid images. He
also indicated that increasing the tangibility of intangible service should

result in a more positive response and more positive evaluation of the website
(Koernig, 2003).
In particular, one participant pointed out the misuse of pictures on one
travel website, and how it eroded trust of consumers:
This is ridiculous. The pictures using to introduce destination A is actually

the image of destination B. This happened on some pages of this website.
I just do not feel I can trust the information provided here at all.
It is interesting to note that using pictures not only applies to products, but to
employees of the companies involved. Steinbrueck et al. (2002) found that
pictures of employees on the homepage of an online bank significantly

increased user trust. Among the travel websites participants visited, only a few
provided pictures of employees (normally tour guides for package holidays).
Participants have mixed opinions on this aspect, with some feeling that inter-
personal cues are needed in a virtual environment such as if the Internet:
The image of people provides interpersonal cues. I think this is impor-

tant in online environments where face-to-face interaction is lacking.
Similarly, another participant felt that the image of employees provided on

travel websites creates a real-world feel as purchasing from traditional travel
agents:
I like to see photos of someone put on the website. It gives me a real-

world feel. Just like the staffs you see on the traditional travel agent, the
photo of employee gives me the same feeling.
Although some participants confirmed the positive influence of the pictures

of employees, one participant was wary of the pictures presented on travel
websites and felt that those are impersonal and did not indicate efficiency
or knowledge of the individual concerned:
I am not sure if the picture shown on the travel website increases my

trust on the website. It is just a picture of somebody. I have no idea if he/
she is caring or capable of doing the job.
The result supports the work of some researchers (Krentler & Guiltinan, 1984;
Berry & Clark, 1986; Li et al., 2001; Koernig, 2003) which noted that combina-
tion of text and picture is more effective for selling travel products than simply
using textual descriptions alone. Graphics, such as pictures, can present much
more detail than simple text, and increase tangibility of travel service pro-
vided (Beldona, Morrision, & O’Leary, 2005). It should be bear in mind that as
the online consumers are becoming more sophisticated, the quality of pictures
should be carefully selected to convey a professional image of the travel website.
In addition, the photos presented should correctly match the travel products
to avoid causing negative perception towards travel websites.
CONCLUSION
The aim of this study was to explore the perceptions of consumers toward
the risk-relievers provided on travel websites and their impact on purchasing
intentions. Several risks are related to planning and purchasing travel products
online, including: performance risk, financial risk, physical risk, psychological
risk, social risk, time risk, and security risk (Kim et al., 2005). The perceived
risk of purchasing online travel products is also argued to be influenced by
privacy risks involved (Kolsaker et al., 2004). In addition, the very nature of
travel products (i.e. intangibility and inseparability) makes it difficult, some-
times impossible, to evaluate the product prepurchase. Travel product pur-
chase therefore associated with a higher perceived risk than tangible product
purchase, e.g. computers. As a result, risk-relievers provided on travel websites
during pre-purchase phase can be argued to have significant impacts on
consumers purchase decision.
As far as privacy risk is concerned, the result of this study seems, to
some extent, inconsistent with the findings of previous research. It appears
that majority of participants did not pay much attention to privacy issues,
and therefore the provision of privacy policy seems to be less effective than
expected. Caution must be paid, however, in interpreting this result as the
Taiwanese consumers seemed to have a low awareness of the conse-
quences of invasion of privacy, e.g. identity theft and exposure to junk e-mail
and unsolicited messages. Even when the consequences were recognized,
participants had doubts about the effectiveness of privacy policies because
there are currently no effective mechanisms to ensure that travel websites
adhere to fair information practice. It is therefore suggested that travel com-
panies in Taiwan must demonstrate their dedication to enforcement of their
principles to gain credibility in the marketplace and earn trust from consumers.
Though Taiwanese consumers were concerned with online security,
the security labels seemed not to have direct bearing on their propensity to
purchase from travel websites. A possible explanation of this result might be
due to alternative payment methods provide on travel websites in Taiwan.
Unlike cross-border travel purchases in Europe, Taiwanese consumers tend
to purchase travel products from local travel websites. As a result, instead of
paying online, consumers can make payments by money transfer or provide
credit card details by fax, particularly where large amounts of money are
involved. It is also noted that Taiwanese consumers prefer to make phone
calls about product and payment information before making purchase decision.
As long as they are satisfied with the customer services, e.g. courteous staff,
they are very likely to make payment online without worrying about online
security. It is therefore suggested that travel companies in Taiwan must
invest in staff training to ensure customer service, which in turn will
increase the likelihood of a satisfactory purchase.
As far as the findings are concerned, it seems that risk-relievers pro-
vided on travel websites do impact the perceived risk of online travel pur-
chase by Taiwanese consumers. Yet the effectiveness of risk-relievers varies,
e.g. risk-relievers such as security labels and privacy policies seem less
effective as perceived by Taiwanese consumers. On the other hand, Taiwanese
consumers pay more attention to risk-relievers such as use of pictures and
provision of contact information. Travel products are associated with higher

risk not only because of their intangibility, but also they typically involve
higher cost and complex choices (Mitchell et al., 1999). As a result, consumers
are in need of information to minimize the risk and uncertainty of travel
purchases as well as maximizing the perceived quality of travel experiences
(Money & Crotts, 2003). Risk-relievers, such as pictures, are considered an
effective strategy to overcome disadvantages associated with the intangibility
of travel products (Koernig, 2003). Travel companies in Taiwan should,
therefore, exploit the potential of pictures by providing high quality pictures
of their products to stimulate consumers’ potential online purchasing intentions
(Koering, 2003).
Online travel communities were perceived by Taiwanese consumers as
an effective way to reduce the perceived risk of online travel purchasing.
Since travel products are experience products and by their very nature, are
hard to assess prior to purchase (Mitchell et al., 1999). Therefore, advice
from other consumers who have prior experience with a particular product
is not only preferred but is not also influential in decision-making process
(Crotts, 1999). Word-of-mouth has been identified as influential among con-
sumers when planning and purchasing travel products (Bieger & Laesser,
2004; Sarigollu & Huang, 2005). The result of this study confirms that travel
communities help consumers make travel decisions by reducing perceived
risk and increasing the likelihood of purchase. It is therefore suggested that
travel companies in Taiwan can harvest such benefits by first creating user-
friendly travel communities based on consumers’ need to reduce perceived
risk, and gradually achieve satisfaction and brand loyalty among members.
LIMITATIONS AND FUTURE RESEARCH
Because of the exploratory nature of this study, some limitations should be

acknowledged. Due to the limited sample used for the observation, the
results should not be constructed to be representative of perceptions of all
Taiwanese consumers. Further research involving a larger sample frame is

needed to validate the findings of this study as to the influence of risk-
relievers provided on travel websites. It is also important to note that the
findings of this study may not generalize to dissimilar cultures. Further
research should assess the generalizability of this finding to other cultures to
determine if significance differences exist due to cultural influences.
Although this study suggests some risk-relievers provided on travel
websites are likely to reduce perceived risk, it is unclear whether the sig-
nificance of risk-relievers varies across various types of travel websites.
Therefore, it would be interesting to observe whether risk-relievers needed
in hotel websites would be the same as those needed in online travel inter-
mediate website (i.e. www.expedia.com). From a marketing perspective it is
essential to know the significance of different risk-relievers in order to

better meet the need of consumers.
As noted earlier, previous research found that reputation has an impact
on perceived risk (Darward & Parker, 1994; Richardson & Dick, 1994), sug-
gesting consumers perceive a higher level of risk when purchasing from a
lesser-known brand than a well-known brand. Although the significance of
reputation is recognized, it is unclear whether it plays a similar role in differ-
ent level of websites (i.e. less-known versus well-known). Further research is
therefore needed to investigate the relationship between reputation and risk-
relievers in order to better exploit the potential of risk-relievers.
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This article was downloaded by: [George Mason University]

On: 17 December 2014, At: 18:22

Journal of Hospitality Marketing &

Perceived Risk and Risk-Relievers in

To link to this article: http://dx.doi.org/10.1080/19368620903235803

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Perceived Risk and Risk-Relievers in Online

Travel Purchase Intentions

PEI-JUNG LIN and ELERI JONES

Cardiff School of Management, University of Wales Institute, Cardiff, Cardiff, Wales, UK

Although the Internet offers numerous benefits, some consumers

KEYWORDS Consumer perceived risk, risk-reliever, online travel

Address correspondence to Eleri Jones, Cardiff School of Management, University of

contributes to both the development of destination image (Kokolosalakis,

for airline tickets online. Seven dimensions of perceived risk (performance

Regardless of the shopping context, consumers exhibit uncertainty con-

Perceived risk is viewed as a multidimensional construct. Several dimen-

PERCEIVED RISK OF BUYING ONLINE TRAVEL PRODUCTS

Roselius (1971) identified a risk-reliever as any action initiated by a buyer or

as risk-reliever in traditional shopping context. This implies that the con-

shopping is essentially related to the characteristics of travel products

RISK- RELIEVERS PROVIDED ON TRAVEL WEBSITES

In line with Roselius’ (1971) definition, risk-relievers provided on a travel

Links (hyperlinks) are a method of moving between websites (Chaffey,

In addition, observation also provides rich, detailed, context-specific descrip-

Sampling and Data Collection

was arranged. A total of 12 observations were conducted yielding rich infor-

TABLE 1 Summary of the Online Purchasing Experiences

Once purchased Once purchased

Yes Nine Eight

RESULTS AND DISCUSSION

To increase the likelihood of consumers being satisfied with the services

I normally buy from websites recommended by friends and so I am confi-

Similarly, previous positive online purchasing experience also contributes to

It is interesting to note that although the interviewees were relatively

FIGURE 1 Security label.

I feel comfortable making payment online by credit card after talking

I make phone calls to ask about payment procedure. If I am satisfied

I bought books from amazon.com a few times, paying by credit card. I

I feel confident paying online when seeing a security label posted. I

presence of security labels.

FIGURE 2 Privacy policy.

Surprisingly, some participants have low awareness of privacy policy

I normally do not pay attention to see if any privacy policy is posed on

I want to talk to customer service staff if I have questions about the

The contact information should be easy to find. It should not be hidden

Participants also revealed contact information can be used to confirm the

FIGURE 3 Contact information.

It is interesting to note that some participants revealed the physical address

I want to visit travel agent by myself to make payment. Therefore, it is

Physical address gives me a real-world feel. It makes me feel the travel

It seems e-mail addresses are not considered essential:

I suppose it will take a while for my questions to be answered by e-mail

FIGURE 4 Search engine.

I am not familiar with buying travel online. I sometimes have no idea

Participants confirmed the significance of relevant links provided and indi-

In particular, one participant stressed the provision of relevant links may

As far as holiday package product is concerned, the links to official

Of course, travel websites should add relevant links in order to provide

I found some links provided by the travel websites were no longer

FIGURE 6 Travel community.

FIGURE 7 Use of photos.

perceived as more neutral and trustworthy than information presented by

It is more appealing to me if several photos associated with destination