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Journal of Electronic Commerce Research, VOL 8, NO.1, 2007

over different subgroups provides further support for the structural model above. However, the fact that consumer trust in an e-store of a multi-channel retailer increases with higher familiarity of the retailer indicates that familiarity of the retailer could be another factor that causally determines trust in the vendor. Since we constructed the familiarity measure ex-post after the survey, due to its nominal scale and due to the fact that it was not part of the original research model, we cannot include it in our structural model. However, an inclusion of the construct in future research might pose a source of further variance explanation of the trust construct. Familiarity seems to be independent of perceived privacy and reputation, as those two factors maintain the same ratio of influence over increasing levels of familiarity. No matter how familiar a customer is with the retailer, the perceived level of privacy determines trust to a stronger extent than the perceived reputation of the retailer. This finding underlines the importance of privacy concerns in multi-channel retailing.

6. Discussion and Implications

The results indicate that perceived privacy of the e-shop has the highest influence on trust, followed by perceived reputation of the store network. The variable perceived size of the store network has the smallest influence on trust in our data. This result has been confirmed in two random samples with acceptable model fits. Although these findings indicate that privacy is crucial to successful e-commerce [see also Teltzrow and Kobsa 2004], Kohavi [2001] indicates that less than 0.5 % of all users read privacy policies. Though visitors often do not act according to their privacy attitudes, most are highly concerned about their privacy online [Berendt, Günther and Spiekermann 2005]. As a consequence, retailers should clearly indicate on their websites that consumers' privacy is protected in order to increase consumer trust.

The results also confirm an effect of perceived store reputation on trust in the e-shop. A small effect of perceived store size on trust is also observed. Thus, our study confirms that consumers' perception of physical stores can have a significant cross-channel influence on trust in an e-shop. Jarvenpaa, Tractinsky and Vitale [2000] showed that reputation and size are important antecedents of trust at Internet-only retailers. Her speculation that the presence of physical stores might increase consumers’ trust in a seller’s Internet store can be supported with our results. It can be assumed that cumulative effects between consumers’ perceptions of online and offline reputation and size exist. This could be an explanation as to why consumers prefer multi-channel retailers that now dominate more than two- thirds of the total online market [Shop.org and Forrester Research 2004]. Thus, a strategy to increase trust could be a promotion of trust-building measures between different sales channels. This could include offline advertising of the website or the placement of in-store kiosks, where consumers can order online when products are out of stock. Further studies should explore the observed influence of perceived store size and reputation on trust in the e-shop and whether there are cumulative effects between the perceived reputation and size of the e-shop on trust. Therefore, a larger sample of consumers is required in order to discriminate between three groups of visitors: "familiar with the website only", "familiar with stores only", and "familiar with both channels".

A further analysis of the variables trust, risk perception and willingness to buy might pose an interesting improvement of our study, since the causality between trust, perceived risk, and willingness to buy has not been confirmed in our model. One reason might be that additional constructs such as familiarity have an influence on the willingness to buy in our model. The model by Jarvenpaa, Tractinsky and Vitale et al. [2000] includes the construct attitude, which was left out in our analysis because the retailer asked to keep the questionnaire as short as possible. A relationship between trust and marketing success is well-known in traditional marketing theory [Berry 1995, Morgan and Hunt 1994]. Further work should test if there are important mediating factors between trust and willingness to buy. For example, Garbarino and Johnson [1999] found that a model including satisfaction as a mediating construct between trust and commitment significantly improves the model fit compared to a model suggesting a direct influence of trust on intentions.

Subgroup analysis reveals that trust increases proportional to familiarity with the retailer. The familiarity index was directly derived from the respondents’ previous visits and purchases at the e-shop and stores. This supports the findings of [2002] and Gefen [2000], who demonstrated that familiarity is a predictor of trust in an e-shop. It is particularly noticeable that regardless of familiarity, the perceived privacy is the factor that influences trust to the strongest extent. Thus, if a retailer desires to direct ‘classic’ store customers to the Internet-based retailing channel, this retailer should place considerable effort on privacy issues.

All in all, the adherence of privacy seems to be the key in creating trust in first-time customers and in customers previously unfamiliar with Internet retailing.

7. Limitations and Further Work Participants in this study were online consumers. Thus, the sample differs from many other empirical studies that primarily use students as a sample of online consumer population. A limit of external validity within our sample

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