Customer Loyalty in E-Commerce
Authore(s) : David Gefen || Department of Management LeBow College of Business Drexel University gefend@drexel.edu.
Volume : (13), Issue : 205, January - 2019
Abstract : The high cost of attracting new customers on the Internet and the relative difficulty in retaining them make customer loyalty an essential asset for many online vendors. In the non-Internet marketplace, customer loyalty is primarily the product of superior service quality and the trust that such service entails. This study examines whether the same applies with online vendors even though their service is provided by a website interface notably lacking a human service provider. As hypothesized, customer loyalty to a specific online vendor increased with perceived better service quality both directly and through increased trust. However, the data suggest that the five dimensions of service quality in SERVQUAL collapse to three with online service quality: (1) tangibles, (2) a combined dimension of responsiveness, reliability, and assurance, and (3) empathy. The first dimension is the most important one in increasing customer loyalty, and the second in increasing customer trust. Implications are discussed.
Keywords :E-commerce, trust, risk, customer loyalty, SERVQUAL.
Article: Download PDF Journal DOI : 301/704
Cite This Article:
Loyalty in E-Commerce
Vol.I (13), Issue.I 205
Article No : 10043
Number of Downloads : 119
References :
Berman, D. K., and H. Green. “Cliff-Hanger Christmas,” Business Week, October 23, 2000 (available at http://www.businessweek.com/2000/00_43/b3704040.htm, accessed April 30, 2002).
Blau, P. M. Exchange and Power in Social Life. New York: Wiley, 1964.
Chellappa, R. K., and P. A. Pavlou. “Perceived Information Security, Financial Liability, and Consumer Trust in Electronic Commerce Transactions,” Department of... More
- Berman, D. K., and H. Green. “Cliff-Hanger Christmas,” Business Week, October 23, 2000 (available at http://www.businessweek.com/2000/00_43/b3704040.htm, accessed April 30, 2002).
- Blau, P. M. Exchange and Power in Social Life. New York: Wiley, 1964.
- Chellappa, R. K., and P. A. Pavlou. “Perceived Information Security, Financial Liability, and Consumer Trust in Electronic Commerce Transactions,” Department of Information and Operations Management, Marshall School of Business, University of Southern California, 2001.
- Chen, P.-Y. S., and L. M. Hitt. “Switching Cost and Brand Loyalty in Electronic Markets: Evidence from On-line Retail Brokers,” in Proceedings of the Twenty-First International Conference on Information Systems, W. J. Orlikowski, S. Ang, P. Weill, H. C. Krcmar, and J. I. DeGross (eds.), Brisbane, Australia, December 14-17, 2000, pp. 134-144.
- Chin, W. W. “The Partial Least Squares Approach to Structural Equation Modeling,” in Modern Methods for Business Research, G. A. Marcoulides (ed.), Mahwah, NJ: Lawrence Erlbaum Associates, 1998, pp. 295-336.
- Chow, S., and H. Reed. “Toward an Understanding of Loyalty: The Moderating Role of Trust,” Journal of Managerial Issues (9:3), 1997, pp. 275-398.
- Coates, J. Women, Men and Languages: Studies in Language and Linguistics, London: Longman, 1986.
- Cole, S. J. “Testimony Before the Subcommittee on Telecommunications, Trade and Consumer Protection Committee on Commerce, U.S. House of Representatives, Washington, D.C.,” 1998, (available at www.bbb.org/alerts/cole.asp;accessed April 30, 2002).
- Cook, T. D., and D. T. Campbell. Quasi-Experimentation: Design and Analysis Issues for Field Settings, Boston: Houghton Mifflin, 1979.
- Cronin, J. J., and S. A. Taylor. “SERVPERF versus SERVQUAL: Reconciling Performance-based and Performance-Minus-Expectations Measurements of Service Quality,” Journal of Professional Services Marketing (20:2), 1994, pp. 125-131.
- Dasgupta, P. “Trust as a Commodity,” in Trust, D. G. Gambetta (ed.), New York: Basil Blackwell, 1988, pp. 49-72.
- Deutsch, M. “Trust and Suspicion,” Conflict Resolution (2:4), 1958, pp. 265-279.
- Doney, P. M., and J. P. Cannon. “An Examination of the Nature of Trust in Buyer-Seller Relationships,” Journal of Marketing (61:2), 1997, pp. 35-51.
- Fukuyama, F. Trust: The Social Virtues and the Creation of Prosperity, New York: The Free Press, 1995.
- Gambetta, D. G. (ed.). Can We Trust Trust?, New York: Basil Blackwell, 1988.
- Ganesan, S. “Determinants of Long-Term Orientation in Buyer-Seller Relationships,” Journal of Marketing, (58) April 1994, pp. 1-19.
- Gefen, D. Building Users’ Trust in Freeware Providers and the Effects of this Trust on Users’ Perceptions of Usefulness, Ease of Use and Intended Use, Unpublished Doctoral Dissertation, Georgia State University, 1997.
- Gefen, D. “E-Commerce: The Role of Familiarity and Trust,” Omega: The International Journal of Management Science (28:6), 2000, pp. 725-737.
- Gefen, D., and P. DeVine “Customer Loyalty to an Online Store: The Meaning of Online Service Quality,” Proceedings of Twenty-Second International Conference on Information Systems, S. Sarker, V, Storey, and J. I. DeGross (eds.), New Orleans, December 16-19, 2001, pp. 613-617. Gefen, D., and C. Govindarajulu. “ERP Customer Loyalty: An Exploratory Investigation Into The Importance of a Trusting Relationship,” Journal of Information Technology Theory & Application(3:1), 2001, pp. 1-18.
- Gefen, D., and D. W. Straub “The Relative Importance of Perceived Ease-of-Use in IS Adoption: A Study of e-Commerce Adoption,” Journal of the AIS (1:8), 2000, pp. 1-30.
- .Gefen, D., D. Straub, and M-C. Boudreau. “Structural Equation Modeling and Regression: Guidelines for Research Practice,” Communications of the AIS (4:7), 2000, pp. 1-70.
- Gulati, R. “Does Familiarity Breed Trust? The Implications of Repeated Ties for Contractual Choice in Alliances,” Academy of Management Journal (38:1), 1995, pp. 85-112.
- Hair, J. F. J., R. E. Anderson, R. L. Tatham, and W . C. Black. Multivariate Data Analysis with Readings (Fifth Edition), Englewood Cliffs, NJ: Prentice Hall, 1998.
- Hartline, M. D., and O. C. Ferrell “The Management of Customer-Contact Service Employees: An Empirical Investigation,” Journal of Marketing (60), October 1996, pp. 52-70.
- Heskett, J. L., T. O. Jones, G. W. Loveman, W. E. J. Sasser, and L. A. Schlesinger. “Putting the Service-Profit Chain to Work,” Harvard Business Review (72:2), 1994, pp. 164-174.
- Hofstede, G. Culture’s Consequences: International Differences in Work Related Values, London: Sage Publications, 1980.
- Hosmer, L. T. “Trust: The Connecting Link Between Organizational Theory and Philosophical Ethics,” Academy of Management Review (20:2) 1995, pp. 379-403.
- Jarvenpaa, S. L., and N. Tractinsky “Consumer Trust in an Internet Store: A Cross-Cultural Validation,” Journal of Computer Mediated Communication (5:2), 1999, pp. 1-35.
- Kaynama, S. A., and C. I. Black. “A Proposal to Assess the Service Quality of Online Travel Agencies: An Exploratory Study,” Journal of Professional Services Marketing (21:1), 2000, pp.63-88.
- Kettinger, W. J., C. C. Lee, and S. Lee. “Global Measures of Information Service Quality: A Cross- National Study,” Decision Sciences (26:5), 1995, pp. 569-588.
- Kollock, P. “The Production of Trust in Online Markets,” Advances in Group Processes (16), 1999, pp. 99-123.
- Kumar, N., L. K. Scheer, and J.-B. E. M. Steenkamp. “The Effects of Perceived Interdependence on Dealer Attitudes,” Journal of Marketing Research (17), 1995a, pp. 348-356.
- Kumar, N., L. K. Scheer, and J.-B. E. M. Steenkamp. “The Effects of Supplier Fairness on Vulnerable Resellers,” Journal of Marketing Research (17), February 1995b, pp. 54-65.
- Llosa, S., J.-L. Chandon, and C. Orsingher. “An Empirical Study of SERVQUAL’s Dimensionality,” The Service Industries Journal (18:2), 1998, pp. 16-44.
- Luhmann, N. Trust and Power, Chichester: John Wiley and Sons, 1979.
- Mayer, R. C., J. H. Davis, and F. D. Schoorman. “An Integration Model of Organizational Trust,” Academy of Management Review (20:3), July 1995, pp. 709-734.
- McKnight, D. H., L. L. Cummings, and N. L. Chervany. “Initial Trust Formation in New Organizational Relationships,” Academy of Management Review (23:3), 1998, pp. 472-490.
- Meyer, A. D., and J. B. Goes. “Organizational Assimilation of Innovations: A Multilevel Contextual Analysis,” Academy of Management Journal (31:4), 1988, pp. 897-923.
- Meyerson, D., K. E. Weick, and R. M. Kramer. “Swift Trust and Temporary Groups,” in Kramer, R.M. and T.R. Tyler (eds.), Trust in Organizations: Frontiers of Theory and Research, Thousand Oaks, CA: Sage Publications, 1996, pp. 166-195.
- Moorman, C., G. Zaltman, and R. Deshpande. “Relationships Between Providers and Users of Market Research: The Dynamics of Trust Within and Between Organizations,” Journal of Marketing Research (29), August 1992, pp. 314-328.
- Nunnally, J. C., and I. H. Bernstein. Psychometric Theory (Third Edition), New York: McGraw-Hill, 1994.
- Parasuraman, A., V. A. Zeithaml, and L. L. Berry. “A Conceptual Model of Service Quality and Its Implications for Future Research,” Journal of Marketing (40), Fall 1985, pp. 41-50. Parasuraman, A., V. A. Zeithaml, and L. L. Berry. “Reassessment of Expectations as a Comparison Standard in Measuring Service Quality: Implications for Future Research,” Journal of Marketing (58), January 1994, pp. 111-124.
- Pitt, L. F.,R. T. W atson, and C. B. Kavan. “Measuring Information Systems Service Quality: Concerns for a Complete Canvas,” MIS Quarterly (21:2), 1997, pp. 209-221.
- Reichheld, F. F., and W. E. J. Sasser. “Zero Defections: Quality Comes to Services,” Harvard Business Review (68:5), 1990, pp. 2-9.
- Reichheld, F. F., and P. Schefter. “E-Loyalty: Your Secret Weapon on the Web,” Harvard Business Review (78:4), 2000, pp. 105-113.
- Rotter, J. B. “Generalized Expectancies for Interpersonal Trust,” American Psychologist (26), May 1971, pp. 443-450.
- Rousseau, D. M.,S. B. Sitkin, R. S. Burt, and C. Camerer. “Not So Different After All: A Cross- Discipline View of Trust,” Academy of Management Review (23:3), 1998, pp. 393-404.
- Shankar, V., A. K. Smith, and A. Rangaswamy. “The Relationship Between Customer Satisfaction and Loyalty in Online and Offline Environments,” EBusiness Research Center Working Paper, 02-2000, 2000 (available at http://www.ebrc.psu.edu/publications/papers/pdf/2000-02.pdf, accessed April 30, 2002).
- Solomon, M. “Service Beats Price on the Web, Study Finds,” Computerworld, 2000 (available at http://www.computerworld.com/cwi/story/0,1199,NAV47_STO45848,00.html, accessed April 30, 2002).The Economist. “E-Commerce: Shopping Around The World,” February 26, 2000, pp. 5-54.
- Van Dyke, T. P., V. R. Prybutok, and L. A. Kappelman. “Cautions on the Use of the SERVQUAL Measure to Assess the Quality of Information Systems Service,” Decision Sciences (30;3), 1999, pp. 877-891.
- Watson, R. T., L. F. Pitt, and C. B. Kavan. “Measuring Information Systems Service Quality: Lessons From Two Longitudinal Case Studies,” MIS Quarterly (22:1), 1998, pp. 61-79.
- Williamson, O. E. The Economic Institutions of Capitalism, New York: Free Press, 1985.
- Young, M. B. “What Customers Want Online,” Marketing Science Institute, 2001 (available at http://www.msi.org/msi/insights/ins00f-c.cfm,accessed April 30, 2002).
- Zeithaml, V. A., L. L. Berry, and A. Parasuraman. “The Behavioral Consequences of Service Quality,” Journal of Marketing (60), April, 1996, pp. 31-46.
- Zeithaml, V. A., A. Parasuraman, and A. Malhotra. “A Conceptual Framework for Understanding e- Service Quality: Implications for Future Research and Managerial Practice,” Marketing Science Ins titute, 2001 (available at h t t p : //www.msi.o rg /msi/p u b licat io n _su mmary. cfm?publication=00-115,accessed April 30, 2002).
- Zucker, L. G. “Production of Trust: Institutional Sources of Economic Structure, 1840-1920,” in Research in Organizational Behavior, B. M. Staw and L. L. Cummings (eds.), Greenwich, CT: JAI Press, 1985, pp. 53-111.
... Less
- Berman, D. K., and H. Green. “Cliff-Hanger Christmas,” Business Week, October 23, 2000 (available at http://www.businessweek.com/2000/00_43/b3704040.htm, accessed April 30, 2002).
- Blau, P. M. Exchange and Power in Social Life. New York: Wiley, 1964.
- Chellappa, R. K., and P. A. Pavlou. “Perceived Information Security, Financial Liability, and Consumer Trust in Electronic Commerce Transactions,” Department of Information and Operations Management, Marshall School of Business, University of Southern California, 2001.
- Chen, P.-Y. S., and L. M. Hitt. “Switching Cost and Brand Loyalty in Electronic Markets: Evidence from On-line Retail Brokers,” in Proceedings of the Twenty-First International Conference on Information Systems, W. J. Orlikowski, S. Ang, P. Weill, H. C. Krcmar, and J. I. DeGross (eds.), Brisbane, Australia, December 14-17, 2000, pp. 134-144.
- Chin, W. W. “The Partial Least Squares Approach to Structural Equation Modeling,” in Modern Methods for Business Research, G. A. Marcoulides (ed.), Mahwah, NJ: Lawrence Erlbaum Associates, 1998, pp. 295-336.
- Chow, S., and H. Reed. “Toward an Understanding of Loyalty: The Moderating Role of Trust,” Journal of Managerial Issues (9:3), 1997, pp. 275-398.
- Coates, J. Women, Men and Languages: Studies in Language and Linguistics, London: Longman, 1986.
- Cole, S. J. “Testimony Before the Subcommittee on Telecommunications, Trade and Consumer Protection Committee on Commerce, U.S. House of Representatives, Washington, D.C.,” 1998, (available at www.bbb.org/alerts/cole.asp;accessed April 30, 2002).
- Cook, T. D., and D. T. Campbell. Quasi-Experimentation: Design and Analysis Issues for Field Settings, Boston: Houghton Mifflin, 1979.
- Cronin, J. J., and S. A. Taylor. “SERVPERF versus SERVQUAL: Reconciling Performance-based and Performance-Minus-Expectations Measurements of Service Quality,” Journal of Professional Services Marketing (20:2), 1994, pp. 125-131.
- Dasgupta, P. “Trust as a Commodity,” in Trust, D. G. Gambetta (ed.), New York: Basil Blackwell, 1988, pp. 49-72.
- Deutsch, M. “Trust and Suspicion,” Conflict Resolution (2:4), 1958, pp. 265-279.
- Doney, P. M., and J. P. Cannon. “An Examination of the Nature of Trust in Buyer-Seller Relationships,” Journal of Marketing (61:2), 1997, pp. 35-51.
- Fukuyama, F. Trust: The Social Virtues and the Creation of Prosperity, New York: The Free Press, 1995.
- Gambetta, D. G. (ed.). Can We Trust Trust?, New York: Basil Blackwell, 1988.
- Ganesan, S. “Determinants of Long-Term Orientation in Buyer-Seller Relationships,” Journal of Marketing, (58) April 1994, pp. 1-19.
- Gefen, D. Building Users’ Trust in Freeware Providers and the Effects of this Trust on Users’ Perceptions of Usefulness, Ease of Use and Intended Use, Unpublished Doctoral Dissertation, Georgia State University, 1997.
- Gefen, D. “E-Commerce: The Role of Familiarity and Trust,” Omega: The International Journal of Management Science (28:6), 2000, pp. 725-737.
- Gefen, D., and P. DeVine “Customer Loyalty to an Online Store: The Meaning of Online Service Quality,” Proceedings of Twenty-Second International Conference on Information Systems, S. Sarker, V, Storey, and J. I. DeGross (eds.), New Orleans, December 16-19, 2001, pp. 613-617. Gefen, D., and C. Govindarajulu. “ERP Customer Loyalty: An Exploratory Investigation Into The Importance of a Trusting Relationship,” Journal of Information Technology Theory & Application(3:1), 2001, pp. 1-18.
- Gefen, D., and D. W. Straub “The Relative Importance of Perceived Ease-of-Use in IS Adoption: A Study of e-Commerce Adoption,” Journal of the AIS (1:8), 2000, pp. 1-30.
- .Gefen, D., D. Straub, and M-C. Boudreau. “Structural Equation Modeling and Regression: Guidelines for Research Practice,” Communications of the AIS (4:7), 2000, pp. 1-70.
- Gulati, R. “Does Familiarity Breed Trust? The Implications of Repeated Ties for Contractual Choice in Alliances,” Academy of Management Journal (38:1), 1995, pp. 85-112.
- Hair, J. F. J., R. E. Anderson, R. L. Tatham, and W . C. Black. Multivariate Data Analysis with Readings (Fifth Edition), Englewood Cliffs, NJ: Prentice Hall, 1998.
- Hartline, M. D., and O. C. Ferrell “The Management of Customer-Contact Service Employees: An Empirical Investigation,” Journal of Marketing (60), October 1996, pp. 52-70.
- Heskett, J. L., T. O. Jones, G. W. Loveman, W. E. J. Sasser, and L. A. Schlesinger. “Putting the Service-Profit Chain to Work,” Harvard Business Review (72:2), 1994, pp. 164-174.
- Hofstede, G. Culture’s Consequences: International Differences in Work Related Values, London: Sage Publications, 1980.
- Hosmer, L. T. “Trust: The Connecting Link Between Organizational Theory and Philosophical Ethics,” Academy of Management Review (20:2) 1995, pp. 379-403.
- Jarvenpaa, S. L., and N. Tractinsky “Consumer Trust in an Internet Store: A Cross-Cultural Validation,” Journal of Computer Mediated Communication (5:2), 1999, pp. 1-35.
- Kaynama, S. A., and C. I. Black. “A Proposal to Assess the Service Quality of Online Travel Agencies: An Exploratory Study,” Journal of Professional Services Marketing (21:1), 2000, pp.63-88.
- Kettinger, W. J., C. C. Lee, and S. Lee. “Global Measures of Information Service Quality: A Cross- National Study,” Decision Sciences (26:5), 1995, pp. 569-588.
- Kollock, P. “The Production of Trust in Online Markets,” Advances in Group Processes (16), 1999, pp. 99-123.
- Kumar, N., L. K. Scheer, and J.-B. E. M. Steenkamp. “The Effects of Perceived Interdependence on Dealer Attitudes,” Journal of Marketing Research (17), 1995a, pp. 348-356.
- Kumar, N., L. K. Scheer, and J.-B. E. M. Steenkamp. “The Effects of Supplier Fairness on Vulnerable Resellers,” Journal of Marketing Research (17), February 1995b, pp. 54-65.
- Llosa, S., J.-L. Chandon, and C. Orsingher. “An Empirical Study of SERVQUAL’s Dimensionality,” The Service Industries Journal (18:2), 1998, pp. 16-44.
- Luhmann, N. Trust and Power, Chichester: John Wiley and Sons, 1979.
- Mayer, R. C., J. H. Davis, and F. D. Schoorman. “An Integration Model of Organizational Trust,” Academy of Management Review (20:3), July 1995, pp. 709-734.
- McKnight, D. H., L. L. Cummings, and N. L. Chervany. “Initial Trust Formation in New Organizational Relationships,” Academy of Management Review (23:3), 1998, pp. 472-490.
- Meyer, A. D., and J. B. Goes. “Organizational Assimilation of Innovations: A Multilevel Contextual Analysis,” Academy of Management Journal (31:4), 1988, pp. 897-923.
- Meyerson, D., K. E. Weick, and R. M. Kramer. “Swift Trust and Temporary Groups,” in Kramer, R.M. and T.R. Tyler (eds.), Trust in Organizations: Frontiers of Theory and Research, Thousand Oaks, CA: Sage Publications, 1996, pp. 166-195.
- Moorman, C., G. Zaltman, and R. Deshpande. “Relationships Between Providers and Users of Market Research: The Dynamics of Trust Within and Between Organizations,” Journal of Marketing Research (29), August 1992, pp. 314-328.
- Nunnally, J. C., and I. H. Bernstein. Psychometric Theory (Third Edition), New York: McGraw-Hill, 1994.
- Parasuraman, A., V. A. Zeithaml, and L. L. Berry. “A Conceptual Model of Service Quality and Its Implications for Future Research,” Journal of Marketing (40), Fall 1985, pp. 41-50. Parasuraman, A., V. A. Zeithaml, and L. L. Berry. “Reassessment of Expectations as a Comparison Standard in Measuring Service Quality: Implications for Future Research,” Journal of Marketing (58), January 1994, pp. 111-124.
- Pitt, L. F.,R. T. W atson, and C. B. Kavan. “Measuring Information Systems Service Quality: Concerns for a Complete Canvas,” MIS Quarterly (21:2), 1997, pp. 209-221.
- Reichheld, F. F., and W. E. J. Sasser. “Zero Defections: Quality Comes to Services,” Harvard Business Review (68:5), 1990, pp. 2-9.
- Reichheld, F. F., and P. Schefter. “E-Loyalty: Your Secret Weapon on the Web,” Harvard Business Review (78:4), 2000, pp. 105-113.
- Rotter, J. B. “Generalized Expectancies for Interpersonal Trust,” American Psychologist (26), May 1971, pp. 443-450.
- Rousseau, D. M.,S. B. Sitkin, R. S. Burt, and C. Camerer. “Not So Different After All: A Cross- Discipline View of Trust,” Academy of Management Review (23:3), 1998, pp. 393-404.
- Shankar, V., A. K. Smith, and A. Rangaswamy. “The Relationship Between Customer Satisfaction and Loyalty in Online and Offline Environments,” EBusiness Research Center Working Paper, 02-2000, 2000 (available at http://www.ebrc.psu.edu/publications/papers/pdf/2000-02.pdf, accessed April 30, 2002).
- Solomon, M. “Service Beats Price on the Web, Study Finds,” Computerworld, 2000 (available at http://www.computerworld.com/cwi/story/0,1199,NAV47_STO45848,00.html, accessed April 30, 2002).The Economist. “E-Commerce: Shopping Around The World,” February 26, 2000, pp. 5-54.
- Van Dyke, T. P., V. R. Prybutok, and L. A. Kappelman. “Cautions on the Use of the SERVQUAL Measure to Assess the Quality of Information Systems Service,” Decision Sciences (30;3), 1999, pp. 877-891.
- Watson, R. T., L. F. Pitt, and C. B. Kavan. “Measuring Information Systems Service Quality: Lessons From Two Longitudinal Case Studies,” MIS Quarterly (22:1), 1998, pp. 61-79.
- Williamson, O. E. The Economic Institutions of Capitalism, New York: Free Press, 1985.
- Young, M. B. “What Customers Want Online,” Marketing Science Institute, 2001 (available at http://www.msi.org/msi/insights/ins00f-c.cfm,accessed April 30, 2002).
- Zeithaml, V. A., L. L. Berry, and A. Parasuraman. “The Behavioral Consequences of Service Quality,” Journal of Marketing (60), April, 1996, pp. 31-46.
- Zeithaml, V. A., A. Parasuraman, and A. Malhotra. “A Conceptual Framework for Understanding e- Service Quality: Implications for Future Research and Managerial Practice,” Marketing Science Ins titute, 2001 (available at h t t p : //www.msi.o rg /msi/p u b licat io n _su mmary. cfm?publication=00-115,accessed April 30, 2002).
- Zucker, L. G. “Production of Trust: Institutional Sources of Economic Structure, 1840-1920,” in Research in Organizational Behavior, B. M. Staw and L. L. Cummings (eds.), Greenwich, CT: JAI Press, 1985, pp. 53-111.