Colonel Sanders was ahead of his time

August 02, 2016

Instilling trust among first-time customers has been a problem for online retailers since the dawn of e-commerce. Now research shows that sometimes the simplest of fixes can reassure would-be buyers.

In "Feeling Close From Afar: The Role of Psychological Distance in Offsetting Distrust in Unfamiliar Online Retailers," forthcoming in the September 2016 issue of the Journal of Retailing, a clutch of marketing experts demonstrated that including even a photo of a store or of a business owner on a shopping site - something visual and representational - can encourage wary buyers to make a purchase from a vendor with which they were unfamiliar. The research was conducted by Professors Peter Darke, of York University; Michael K. Brady, of Florida State University; and Andrew E Wilson, of Saint Mary's College of California; and consultant Ray L. Benedicktus, of Lieberman Research Worldwide.

Surveys show that Internet users are even more concerned about scams and fraud related to online shopping than they were a few years ago, the authors write. Purely virtual vendors, who lack a physical presence, or those with a geographically distant retail location, are at the greatest disadvantage in selling their wares online, partly from the psychological distance felt by customers.

The authors' studies presented hypothetical online shopping situations to undergraduate business students and then questioned them on attitudes. In one study, participants were assigned to view a mock website to buy a pair of diamond earrings from a fictitious vendor. Some students were shown a site that included a stock photo image of a middle-aged man in a business suit working at a computer with his name and position ("owner") shown in a caption; other sites included an image of a nondescript office building; still other participants saw no images and were told the vendor was purely virtual. Additionally, the vendor was variously said to be local or 1,500 miles away. In most cases, according to the research, participants preferred to purchase the earrings from those sites that showed a building or a person. The implication is that any such suggestion of physical or social reality associated with the online retailer boosted new customers' confidence in that business.

Based on their results, the authors recommend specific strategies for online retailers that lack the resources to create a well-known brand or build enough physical stores to have at least a regional presence - for instance, to better inform web customers that a physical store exists and present images and familiarize customers with the owner's name and picture. These strategies, they write, are cost-effective ways small retailers can use to circumvent the constraints of distance and anonymity and encourage consumers to purchase online.

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