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Gender and the effect of social presence on building trust

Coica Luana Carmen [11281553]

23

rd

of June 2017

MSc Business Administration: Marketing

Final Version Master Thesis

Supervision: Dr. Jonne Guyt

Second Reader:

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Statement of originality

This document is written by Student Luana Carmen Coica who declares to take full responsibility for the contents of this document.

I declare that the text and the work presented in this document is original and that no sources other than those mentioned in the text and its references have been used in creating it.

The Faculty of Economics and Business is responsible solely for the supervision of completion of the work, not for the contents.

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ACKNOWLDEGEMENT

Above all else, I would want to express my true appreciation to Dr. Jonne Guyt, Assistant Professor at the University of Amsterdam and my thesis supervisor for the important direction he gave throughout the whole process, enthusiasm and promptitude in giving valuable feedback.

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Table of contents

ABSTRACT ... 6 INTRODUCTION ... 7 1. LITERATURE REVIEW ... 9 1.1 GENDER DIFFERENCES ... 9

1.1.2 THE SELECTIVITY HYPOTHESIS ... 11

1.1.3 GENDER AND OLINE SHOPPING BEHAVIOR ... 12

1.2 ONLINE RETAILING AND WEBSITE DESIGN ... 13

1.3 SOCIAL PRESENCE IN E-COMMERCE ... 14

1.4 TRUST IN E-COMMERCE ... 16

1.4.1 PERCEIVED SOCIAL PRESENCE AND TRUST ... 18

2. RESEARCH GAP ... 19 2.1 Research Question and conceptual model ... 19 3. RESEARCH DESIGN ... 21 3.1 METHOD ... 21 3.2 SAMPLE ... 21 3.3 STUDY RELEVANCE ... 22 3.4 MEASUREMENT OF VARIABLES ... 23 4. STATISTICAL ANALYSIS AND RESULTS ... 25 4.1 DATA PREPARATION, NORMALITYAND RELIABILITY TEST ... 25 4.2 FACTOR ANALYSIS ... 26 4.3 COMPARE MEANS ... 28 4.4 CORRELATION MATRIX ... 29 4.5 LINEAR REGRESSION ... 31 4.6 SIMPLE MODERATION ... 32 5. DISCUSSION ... 34 5.1 ACADEMIC RELEVANCE ... 35 5.2 MANAGERIAL IMPLICATIONS ... 36 5.3 LIMITATIONS AND SUGGESTIONS FOR FUTURE RESEARCH ... 37 6. CONCLUSION ... 39 REFERENCES ... 42 Appendix ... 49

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LIST OF FIGURES

FIGURE 1: CONCEPTUAL MODEL ... 20

LIST OF TABLES TABLE 1: FACTOR ANALYSIS ... 28

TABLE 2: MEAN COMPARISON ... 29

TABLE 3: MEANS, STANDARD DEVIATIONS, CORRELATIONS (Gender: Male) ... 30

Table 4: MEANS, STANDARD DEVIATIONS, CORRELATIONS (Gender: Female) ... 30

TABLE 5: LINIAR REGRESSION MODEL (MALE GROUP) ... 32

TABLE 6: LINIAR REGRESSION MODEL (FEMALE GROUP) ... 32

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ABSTRACT

Nowadays, online shopping has become a popular activity and its popularity is increasing day by day. As a consequence there are more and more businesses that have online stores in order to satisfy the need consumers have to shop online as it develop to be a very easy activity and rewarding. However there are still people who lack trust to make their shopping online as it is impersonal, anonymous and moreover there is not human warmth or sociability on these online websites compared to the traditional shopping.

The purpose of this study is to investigate if chat boxes that are instruments of social presence may have an effect on building trust in a website, a factor that is particularly important for new online stores. In addition, conforming to the literature it is expected to appear differences between gender, females especially ought to be more inclined to have a bigger interest in these websites, because presently they prefer traditional shopping due to the fact that is not so lone in nature it lacks interaction, sociability. Therefor, first of all it has to be tested whether it is in a fact a relationship between gender, social presence and trust. With this study it is demonstrated that higher levels of perceived social presence have a positive impact on trust. Implication of these findings are outlined in the subsequent chapters

KEYWORDS: social presence, trust, gender, online shopping, chat box

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INTRODUCTION

Over the past decade, online shopping has become almost indispensable in our lives. According to Santo Singh who is a web developer, online shopping is part of our daily life routine due to its numerous advantages, for instance: saving time, energy and fuel, price comparison can be done with just a few click due to the advancements of the search engine, 24/7 availability which can provide consumers with freedom to shop anytime and from any place, moreover it is very easy to search the exact merchandise that one particular consumer desires. Therefore, it is precisely because of this considerable development of online shopping that stimulated great enthusiasm to understand what affects individuals’ choices whether to participate or abstain from online shopping (Cho, 2004; Glassberg, Grover, and Teng, 2006; Kim, Williams, and Lee, 2003; Korzaan, 2003; Liao and Cheung, 2001; Ranganathan and Grandon, 2002; Shih, 2004; van der Heijden and Verhagen, 2004; Zahedi and Song, 2009).

Despite the fact that the amount of Internet customers is uniformly divided among males and females, a greater number of men than women participate in web based shopping and make online buys (Rodgers and Harris, 2003). This gender gap in web based shopping attracted thoughtfulness regarding what part plays gender in the web shopping activity and which are the components that influence men's and women’s aim to purchase on the web (Rodgers and Harris, 2003; Sanchez-Franco, 2006; Van Slyke, Comunale, and Belanger, 2002). Notwithstanding, the analysis made by the consultancy Decision (2004) claims that women have an edge over men as far as web based spending. As stated in this analysis, ladies spend more than men on merchandise extending from basic supplies to furniture, books and clothes. The distinction between genders in online shopping has been analyzed from different viewpoints, for instance, the perceived risk of web based purchasing (Garbarino and

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Strahilevitze, 2004), site usage and design (Cyr and Bonanni, 2005), and innovation acknowledgment (Chen, Gillenson, and Sherrell, 2002; Porter and Donthu, 2006; Sanchez-Franco, 2006).

Online trust is critical to the achievement of online retail stores as it boosts online purchase intention, which thus, increments online purchases (Gefen and Straub, 2004). Koufaris and Hampton-Sosa (2004) express that trust is the most widely recognized motivation behind why customers don't make buys on the web—an issue which, Wang et al. (1998) presents it as one of the greatest handicap to the development of web based business around the world. Online trust can be characterized as "an individual’s belief in the competence, dependability, and security of the system under the conditions of risk" (Kini and Choobineh, 1998:9). New organizations having to enter in the online retail market, particularly endure low levels of trust from customers (Oxley and Yeung, 2001). Based on that, one might depict that online trust is the first step in achieving success in the online environment. Therefore, any instrument that can make customers having more trust is particular important in order to become successful in this highly competitive environment (Wang and Emurian, 2005).

Social presence is one of these potential instruments that can be utilized to build trust (Cyr et al., 2007; Gefen and Straub, 2004; Hassanein and Head, 2004). Online social presence can be characterized as a concept that might consists of several components of a site such as: personal, agreeable, sensitive human details (Gefen and Straub, 2004; Short et al., 1976). Taking into account this wide definition, social presence can then range from socially rich content and depictions that can arouse positive feelings to live chat boxes. One could contend that the more prominent the requirement for online trust, the more noteworthy the level of social presence an online retailer ought to put resources into (Andrzej Ogonowski et al., 2014).

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However, little is known about the impact that social presence in the form of chat boxes might have in order to support building trust when consumers visit an e-commerce website. Due to the fact that managers could benefit from the use of such tools and judging from the fact that they are not particularly used when building a website, this study could have some potential good implications. In addition gender differences could also arise a repercussion having into account that females perceive online shopping not a very social activity, yet using this tool it could change this point of view and increase the level of trust in the website which in turn can increase online purchases.

1. LITERATURE REVIEW

In this section of the proposal I will present and elaborate on the critical writing important to outline the status quo this theory depends on, before prompting to the research gap

and to the research question that I will answer in the search to fill it.

1.1 GENDER DIFFERENCES

The occurrence of women shopping on the web is progressively expanding, albeit generally little is known about gender contrasts when purchasing on the web. Dittmar et al. (2004, pp. 423) acknowledges:

“Given that men and women have been shown to differ in their attitudes toward both the Internet and shopping (in conventional environments), it seems surprising that there is little research that explicitly addresses gender differences in on-line buying.”

Past empirical studies have exhibited critical gender differences over an assortment of activities and attributes. Jones et al. (1998) discovered that men and women have noteworthy

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contrasts in their response to visual pictures, thus influencing their recall and acknowledgment. Degeratu et al., (2000) found that visual cues have higher effect on online decisions, while Harvey et al. (1998) recommends that gender is a reason for visual bias utilized by national brands to draw in consumers. A quality which one would hope to be grasped by the creators of today's visually oriented websites is visual orientation. Another factor that brings differences among gender is the perceived risk. Men perceive less risk than women in their shopping behavior (Mitchell and Vassoss, 1997) which could influence their behavior to buy over the Internet. Nonetheless, usage contrasts gives an alternative clarification for this distinction in purchasing. Earlier research has demonstrated that as Internet use increments, the perceived risks in the process of purchase diminishes (Miyazaki and Fernandez, 2001; Kehoe et al., 1998).

Earlier research that examines gender-related states of mind and activities on the web argue that women, more than men, are less inspired by the web, invest less energy online than men, and are more averse to buy on the web (Allen, 2001; Garbarino and Strahilevitz, 2004; Rodgers and Harris, 2003).

It is normal that the design of the site may affect client inclinations, which thusly may deliver varying responses amongst men and women. Chen and Dhillon (2002, p.310–311) compose:

“In the case of an internet vendor, the website is perhaps the only way a firm communicates with its customers. Therefore, its appearance and structure encourage or discourage a consumer’s purchase intentions. In the marketing literature, website features such as layout, appeal, graphics, readability, and ease-of-use have been considered to affect consumers’ clicking frequency.”

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Zhou et al. (2007) propose three clarifications for gender contrasts in web based shopping. To begin with, when it comes to the shopping orientation, men and women are different to each other. While men incline toward comfort over social interaction, women are more roused by enthusiastic and social communication. In this manner, the absence of interaction and communication or social association offered by web based shopping, may prevent a greater number of women than men from shopping on the web (Dittmar et al., 2004). Second, the sorts and attributes of items that are accessible on the online environment appear to support men (Van Slyke et al., 2002). Items that are more connected with men, for example, PCs and gadgets are adequately accessible and can be effortlessly obtained on the web. While items that are more connected with females, for example, sustenance, home style, and dress may not be so broadly accessible on the web. Accordingly, women may see Internet shopping as less perfect and less pleasing than traditional shopping. At last, ladies lean toward and appreciate physical assessment of items, for example, seeing and feeling the item before they get it (Cho, 2004 and Dittmar et al., 2004). Despite the fact that organizations can give clear pictures and movements of their items on their site, clients can't touch or feel these items.

1.1.2 THE SELECTIVITY HYPOTHESIS

The selectivity hypothesis attests the fact that gender utilizes distinctive systems and have distinctive limits in terms of processing data (Meyers-Levy, 1989; Meyers-Levy and Maheswaran, 1991; Meyers-Levy and Sternthal, 1991). All the more particularly, it suggests that, contrasted with males, females tend to process data all the more extensively, and have a lower edge for data apprehension (Chunlei Chai et al. 2016). In other words, females can be more inclined to identify and frame appraisals in light of few information available, but rather pertinent data (Chunlei Chai et al. 2016).Conversely, males are more selective in terms of handling information than females and they depend all the more vigorously on less effortful

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heuristics. In the web based shopping circumstance, it was found that females invested more time in surfing each page of the website, however they saw less pages, whilst men invested less time per page, yet got to view more pages (Arcand, Nantel, and Secal, 2011).

Taking into consideration cognition and attitude studies show there are two sorts of gender differences, including close relative opposites and diverse systems utilized in the data determination process. We can infer that, because of contrasts in cognition and attitude, males play a more active part in the web based shopping process, take part in more investigation, and incline toward a more updated information, while at the same time, females have a tendency to be more detached and influenced by the Internet setting (Hasan, 2010). In this way, it can be confirmed that males and female shave a different conduct when using Internet to shop.

1.1.3 GENDER AND OLINE SHOPPING BEHAVIOR

When all is said in done, males have been found to discern Web shopping more positively than females, and the likelihood to make online purchases is greater (Van Slyke et al. 2002; Korgaonkar, P. & Wolin, L. 1999; Wolin, L.D. & Korgaonkar, P. 2003). Clarifications for the decreased interest of females incorporate their reaction to website design, lesser anticipated emotional advantages, diminished freedom for social interaction, and the sorts of products that are accessible for purchase.

Simon, S.J. (2001) has suggested that less ideal perceptions of websites from female part depend somewhat on sex contrasts due to webpage design. In contrast with males, ladies were substantially more inspired by having sites giving higher number of data, nonetheless minimal usage of graphics and pull-down menus. Interestingly, males responded decidedly in favor of animation and graphics. Alluding to the selectivity theory, Simon speculated that

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websites could miss the mark in meeting the preparing inclinations of females in the event that they neglect to give adequate data or in a sense if it does not seize female’s attention.

Rodgers and Harris (2003) additionally singled out color and graphics as potential drivers of gender contrasts in emotional reaction to websites. They contemplated that if the definite processing style of women augment consideration to more indirect cues, females may have higher guidelines for the design of the website and experience less fulfillment than men.

Gender differences in online behavior may depend as much on the sorts of items that are purchased as they do on differentiating information processing styles (Van Slyke et al. 2002; Rodgers, S. & Harris 2003; Bhatnagar, A., Misra, S. & Rao, H.R 2000). Clothing and make-up, products that usually are purchased by females, might be more suited to conventional shopping conditions where products can be effectively assessed and where improving procedures are more proper (Alreck, P. & Settle, R.B. 2002; Eastlick, M. & Feinberg, R. 1997).

At long last, the absence of social presence may additionally clarify the smaller interest of females towards online shopping (Van Slyke et al. 2002). A few sites cultivate a feeling of group with chat rooms and examination sheets, or encourage customers to publish reviews, yet most online shopping is lone in nature.

1.2 ONLINE RETAILING AND WEBSITE DESIGN

Web based retailing is a dynamic, elaborate and aggressive division in which firms give an assortment of items and benefits to customers by means of the web (Kilic and Senol, 2010). Conforming to Heinemann and Schwarzl (2010, p. 215), the benefits of utilizing online retailing include: “an increased base of potential customers, wider market coverage,

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effectiveness, a diffusion of risks, flexibility, customer loyalty, as well as improved image and brand renewal.”

Today, web innovation empowers retailers not only to offer their items and benefits to customers on the web, but also to personalize online store environment for particular clients (Vrechopoulos, 2010). Generally, the term atmospherics is utilized to portray a store's space and outline, nonetheless it is currently further promote as part of electronic commerce to portray the format and design of the web store webpage (Abbott et al., 2000). Karimov et al. (2011) established a general classification scheme for web composition: visual outline, for example, format and shading that gives clients their early impact; content design, such as data delivered on the site; and social cue design, which is installed in the web interface and permits individuals to interact utilizing diverse social media. A few analysts additionally affirmed that utilizing marketing components in web configuration is very viable with respect to earning dominance on the market (Baloglu and Pekcan, 2006; Caballero-Luque et al., 2010; Gazzar and Mourad, 2012).

1.3 SOCIAL PRESENCE IN E-COMMERCE

Social presence has been characterized as the degree to which a medium enables clients to experience others as being mentally present (Fulk et al., 1987). Social presence hypothesis sees it as a quality innate in a correspondence medium (Short et al., 1976). A few scientists describe the social presence of a medium as its ability to convey data about outward appearances, attitude, dress and non-verbal cues (Short et al., 1976). Others, concentrate on its close relation with data lavishness (Rice et al., 1989; Straub, 1994; Straub and Karahanna, 1998), which core is the interactivity of the media (Sproull and Kiesler, 1986). However, there are some who put the accent on the mental association, where social presence is affected by ''warmth''. From this aspect, a medium is identified as being warm, conceding that

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it passes on a sentiment that resembles human contact, amiability, and affectability (Rice and Case, 1983; Steinfield, 1986; Yoo and Alavi, 2001).

A prominent distinction amongst online and offline shopping situations is that the later includes an extensive variety of feelings including different sorts of social associations with people through various neurological means (Institute of Korea Science and Technology, 1996). Kumar and Benbasat (2002) emphasize that in this period of new retail, ‘‘shoppers have become guests, shopping has become an experience and malls have become entertainment centers with communities’’. The web based shopping experience, then again, is fundamentally adapted in order to diminish the client's emotional load weight through practical and performance based web architecture heuristics (Head and Hassanein, 2002; Kumar and Benbasat, 2002; Nielsen, 2000). In that capacity, online websites might be seen as lacking human warmth and amiability, since it is more unoriginal, undisclosed and computerized than conventional “face to face commerce” (van der Heijden et al., 2003). When all is said in done, online media, for example, the Internet, are commonly regarded as lacking social presence.

Social presence is regularly utilized as a device that empowers cooperation amongst users and customer service delegates in an web based business environment (Qiu and Benbasat, 2005). However, it must be noticed that there is a wide assortment of social presence instruments which still display some components of human interaction, but do not fundamentally and straightforwardly pertain to client service, for instance photos of people or fragments of socially eloquent text (Hassanein andHead, 2007; Qiuand Benbasat,2005). However, the utmost visual frame of social presence, are online chat boxes. Online chat boxes are available live to clients to answer any inquiries that they may have with respect to the item or, on the other hand service and are answered by professionals or specialists.

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Typically, when a client comes online, a live visit box flies upon the screen, indicating to clients that there is someone accessible online to help them (Andrzej Ogonowski et al. 2014).

Therefor, this thesis has in this way utilized a particular social presence tool that is chat box with a specific end goal to examine its impacts on trust development. The capability of a relationship existing between social presence and online trust can be credited to the way that trust development normally happens amongst individuals, and trust formation is consequently social in nature (Gefen and Straub, 2004; Luhmann et al., 1979). Many authors propose that social presence is a forerunner of online trust (see for instance Hassanein and Head, 2004) and observational research (see Gefen and Straub (2003), Hassanein and Head (2004) and Cyr et al. (2007)) all affirms the presence of a critical, positive connection between social presence and online trust.

1.4 TRUST IN E-COMMERCE

Trust is a complicated notion that has been broadly considered and studied through the years. In any case, it remains a troublesome idea to portray because of its dynamic, advancing and multi-faceted nature (Ambrose and Johnson, 1998; Lewicki and Bunker, 1996). Shapiro(1987) portrayed it best, when calling the condition of trust definitions a ''confusing potpourri''. In spite of the fact that there might be numerous approaches to depict this idea, the most commonly referred meaning of trust in different settings (as indicated by Rousseau et al., 1998) is the “willingness of a party to be vulnerable to the actions of another party based on the expectations that the other will perform a particular action important to the trust or”, as proposed by Mayer et al. (1995). Subsequently, vulnerability is not simply chance taking, but rather the ability to go for it (Ambrose and Johnson, 1998). The all the more trusting we are, the all the more ready we might be to go out on a limb of engagement/cooperation. For instance, buyers will be all the more eager to acquire items

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from a seller, in the event that they can have a certain reliability on the seller's statement and that he will not exploit the purchaser's vulnerabilities (Geyskens et al., 1996).

The dominant part of research on online trust, in any case, utilizes the approach of the Technology Acceptance Model's (TAM), as created by Davis (1989), when examining on the web trust (Cyr et al., 2007; Gefen and Straub, 2003; Hassanein and Head, 2004) where seen convenience, saw usability, pleasure and social presence are all contributing components to online trust.

In a web based shopping setting, customers are helpless and liable to open themselves to loss on the off chance that they (Kim and Benbasat, 2003): give their email address which is making themselves powerless against getting spam email or different other inconveniences; give their delivery data of a product which can make them defenseless against security attack; give their Visa numbers that is making themselves powerless against fraud; or finalize online acquisitions, making themselves defenseless against quality and administration insufficiencies. Thus, building trust is particularly critical in the online setting in order to affect in a positive way customers' states of mind and buying goals (Bart et al., 2005; Corritore et al., 2003; Gefen et al., 2003; Roy et al., 2001; van der Heijden et al., 2001; Wang and Emurian, 2005).

Authors, who essentially concentrate on understanding the idea of online trust, tend to partition the trust concept into its different segments. This gives a plentiful investigation of the effects of different precursors on trust segments and the connections among the trust-related constructs. Various studies propose the concept of trust to be disintegrated so that it incorporates knowledge-based trust, institution-based trust, calculative-based trust, cognition-based trust and identity cognition-based trust (illustrations incorporate Gefen et al. (2003) and McKnight et al. (2002)). Schlosser et al. (2006) bring up that a multidimensional perspective

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of trust can recognize what moves ought to be made to construct trust. Be that as it may, in studies where trust is not the essential concentration, but rather simply one concept to comprehend an alternate or bigger phenomenon, trust has been conceptualized as a solitary build (illustrations incorporate Al-Natour et al., 2005; Cyr et al., 2007; Gefen et al., 2003; Koufaris and Hampton-Sosa, 2002; Luarn and Lin, 2003). Consequently, the focus of this study is to investigate the impact of social presence on the formation of trust when purchasing online having gender as a moderator.

1.4.1 PERCEIVED SOCIAL PRESENCE AND TRUST

Trust is established inside the setting of a social setting (Blau, 1964; Fukuyama, 1995). Simon (2001) inspected social presence of sites. Simon takes note of that “information richness and social presence are closely related concepts”, and that “information-rich, consumer-oriented websites should help reduce ambiguity, increase trust/reduce risk, and encourage users to purchase with lower levels of consumer dissonance (p. 26).

Gefen and Straub (2003) affirm that social presence is a fundamental condition for increasing trust. It is simpler to shroud data and participate in deceitful conduct in a lean social presence setting than in a high social presence environment. In this way, more trust can be created in a circumstance that showcases more prominent proof of social presence (Gefen and Straub, 2003; Wang and Emurian, 2005).

Basically, social presence in the online environment, for instance websites designed for consumers to buy different products such as small appliances has proven to have an influence on building trust in the website.

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2. RESEARCH GAP

With this research I'm attempting to address the gap that exists in the literature. As far as anyone is concerned and look into, few articles considered the connection amongst gender and to be more precise, gender differences and social presence that may affect the level of trust that consumers may put in a particular website. However each variable (social presence and trust), independently studied is proven to enhance online purchases. Therefore the implications to which I wish to reach are to comprehend whether one particular tool of the social presence that are selected for this study to be chat boxes and how gender may affect it in connection to trust. Overall the desired contribution that I wish to reach is whether females perceive social presence to have a higher significance in their overall perception, therefor an increase in the level of trust in a e-commerce website.

2.1 Research Question and conceptual model

To examine the effect of different levels of socially rich web architecture components (chat-boxes) on the view of website trust and examine whether gender can affect this relationship, the subsequent research model is depicted in Fig. 1. The model below is based on prior work by Gefen and Straub (2003), who inspected the impact of social presence on purchase decisions in an online environment. However in this study the focus is going to be only on social presence and trust that consumers can have once a certain degree of social presence is perceived and the addition to the model is gender and the differences that may appear based on the literature between males and females in an e-commerce environment. On account of these suppositions the research question of the study is going to be:

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How does social presence influence the degree of perceived trust in e-commerce websites and how does gender differences moderates this effect?

FIGURE 1: CONCEPTUAL MODEL

The following hypotheses will be tested in this research paper:

H1: Social presence has a direct positive relationship with trust in the e-commerce website.

H2: The positive relationship between social presence and trust in the e-commerce website is moderated by gender differences, so this relationship is stronger for females.

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3. RESEARCH DESIGN

In order to answer to the research question a quantitative research by means of a survey was conducted.

3.1 METHOD

The examination approach was drawn deductively through a quantitative research. Through this quantitative investigation an explanatory in nature and correlational research was conducted. Essential information was gathered through a cross-sectional study in order to answer to the hypotheses that are being tested. There are going to be two treatment groups and two control groups, around 50 people per treatment more or less and the allocation to the treatment will be completely random to overcome bias. Through the use of photoshop a picture was designed that illustrated the interface of a website that sells camera equipment. The treatment groups (around half of the females involved in the study and similar males- they were the treatment group) received a picture that had a chat box implemented in the website, whilst the other illustration did not have one (the other half of the sample which belong to the control group). The survey will be distributed in the social media and will be administered digitally. A pretest using a small sample of 25 respondents was conducted in order to assess the logical and good argumentation of the questions as well to test whether the survey receives the desired attention.

3.2 SAMPLE

The population of interest for this study was Dutch and international consumers, more precise Dutch and international students. Due to the fact that e-Commerce research has demonstrated that online consumers are usually younger and more educated, business students are a well

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representative sample that was used in this survey (Jiang and Benbasat 2004-2005; McKnight et al. 2002). As a result of having a large population and also the sampling frame being unknown, this research was conducted using a non-probability convenience sample. Means of social media were utilized in order to reach as many students as possible during the data collection period that took around 3 weeks including the pre-test conducted, such as Facebook (different student groups) and personal e-mail.

The sample size consisted of 223 respondents out of which 103 are male respondents and 120 are female respondents. So, it could be argued there is a good proportion of both genders.

3.3 STUDY RELEVANCE

Differences between men and women in terms of website assessment are still to be researched as there are still many questions unanswered. It may be possible that men and women do not have gender differences preferences anymore, however this thesis is going to bring new insight on social presence and building trust through one type of instrument of social presence. The most intriguing contribution is going to be to point out if individuals particularly think about a customized format and the motivation behind why is that. Is this since they like personalization due to the fact they feel that a company is making a personal attempt to attract them, or is it as result of the fact that they subliminally settle on various decisions when certain hues are shown?

Subsequently, these discoveries could substantially affect the way advertisers and website specialists build up ecommerce sites. In the event that without a doubt clients indicate distinctive conduct and gender preferences emerge, when they get the chance to be presented with a particular instrument of social presence which is the online chat-box which is argued that based on the extensive literature can have an impact on the trust that consumers

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have in the website. Organizations ought to consider them, so they can make the best site that upgrades client encounter. This is legitimate for either positive or negative results of the research.

At the end of the day a better evaluation and a higher trust in the website is expected to cause a higher purchase intention and likelihood that the customer is going to revisit the website to make future purchases.

3.4 MEASUREMENT OF VARIABLES

Concerning the nature and quality of the information gathered, just measures that had been as of now settled and broadly utilized in published empirical studies have been chosen for this research study. All items used in the questionnaire were derived from English studies, however the original items were not translated into Dutch, taking into consideration the fact that the environment where the questionnaire has been distributed (University of Amsterdam) is highly internationalized and everybody knows English.

To measure perceived social presence, the validated scale of Gefen and Straub (2003) (Cronbach’s = .93) was used. The measure consists of three items and assesses the overall perception of consumers referring to social presence felt on a website. An example of one of the item is: “There is a sense of human contact on this website“. A 7-point Likert-scale ranging from 1 (strongly agree) to 7 (strongly disagree) was utilized in this survey.

In order to measure trust on the website the validated four item by Gefen et al. (2003) was used. The Cronbach Alpha value of the items is 0.821. The measure consists of four items that are indicators of trust that consumers have in a particular website, in this case a fictional website that sells camera photos. One example of such item is “I feel that this online vendor

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is honest”. Respondents were requested to answer according to a 7 point Likert-scale that ranged from 1 (strongly agree) to 7 (strongly disagree).

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4. STATISTICAL ANALYSIS AND RESULTS

This chapter provides the main findings from the data analysis using the given answers to the survey that was distribute to students. There have been collected 223 answers from both males and females.

4.1 DATA PREPARATION, NORMALITYAND RELIABILITY TEST

Data was collected by means of an administrated survey designed in Qualtrics during end of May and first week of June. So, all the information was gathered in three weeks time. In order to conduct all the statistical procedure, the Statistical Software Package for Social Sciences (SPSS) has been used. Gender was dummy-coded with 1 for females and 0 for males.

Considering the fact that the presence of missing data or errors has to be detected before any other analysis, all the variables have been checked by running a frequency test. No errors have been found and besides the amount of data that was missing was not significant- only one respondent did not answer the entire survey. So, in order to analyze only complete data, the values that were missing have been excluded.

The distribution normality of the collected data was checked and for the sake of interpretation, all the results have been tested by their skewness and kurtosis value. Looking at perceived social presence skewness is between -0.5 and 0.4 and kurtosis between -0.8 and -1.2, which illustrates that the distribution might be a bit flatter, additionally the items do not have a normal distribution. Concerning trust, skewness is between 0.2 and 0.8 and kurtosis between -0.7 and1.1 which indicates that the distribution was moderately positive and flatter.

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In order to check whether the findings followed by the data collection were consistent to one another, a reliability test was conducted, having the results reported mainly through the Cronbach’s coefficient. Due to the fact that the items were previously validated in other empirical studies, there were high expectations to obtain a comparable satisfying reliability.

Perceived social presence scale has good reliability (>.80), with a value of the Cronbach’s Alpha of .852. All the items have a good correlation score with a total score of the scale (>.30) that is shown by the corrected item-total correlation. The result would not be substantially affected by the removal of one of the items.

The scale used to measure trust has also a good reliability (>.80) having the value of the Cronbach’s Alpha of .879. The same as with the previous scale, the correct item-total correlation points to the fact that the items have a good correlation with the total score obtained by the scale above, all of them .30. Similarly, none of the items would have substantially affected reliability if there were the case to delete one of them.

4.2 FACTOR ANALYSIS

The step that followed in the statistical analysis procedure was to check the connection between some variables that ought to have a similar variance under certain unobservable factors(Bartholomew et all., 2011).

Taking into consideration the theory which argues the fact that social presence with its specific instruments might influence the process of building trust in a website, combining these two variables a certain degree of percentage might explain a shared variance. An in-depth factor analysis of these two cases can be found in table 1.

Table 1 illustrates the fact that indeed there are similarities between social presence and trust. A principal axis factor has been conducted, an analysis for each variable which

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included the approach called Kaiser-Meyer-Olkin (KMO=.816), a value higher than .60, verifying the sampling adequacy. Bartlett’s test of sphericityχ2 (223)= 423.994, p<.001 which illustrated the fact that the correlation was significant between the items in order to implement PAF. Secondly, another analysis was run so that it could achieve the eigenvalues for each component that was in the data file. Two elements manage to fulfill Kaiser’s criterion of 1 and together they explained 75.24% of the variance. Consequently, two factors were rotated through Oblimin with Kaiser Normalization and the loadings after rotation can be seen in table 1, below. From the table below (table 1) it can be observed that factor 1 was assimilated with trust whilst factor 2 with social presence. The goodness of the scale can be now demonstrated by the results that show that all items are clustered on variables.

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TABLE 1: FACTOR ANALYSIS

4.3 COMPARE MEANS

In order to check whether the manipulation worked in the survey which referred to the fact that people who were presented with the picture of the website that contained a chat box perceived a higher degree of social presence than the other respondents who did not have the chat box the social presence variable and Yes/No Chat box variable were previously dummy coded in order to make the analysis. (1-Yes Chat box and 0-No Chat box). Gender was dummy coded into 0 for female and 1 for male.

Code Item

Rotated factor Loadings Trust Perceived Social Presence Trust

The following questions are related to the degree of trust that consumers have in

a website

Trust_1.

1 I feel that this online vendor is honest. .94

Trust_1.

2 I feel that this online vendor is trustworthy. .93

Trsut_1.

3 I feel that this online vendor cares about customers. .78 Trust_1.

4 I feel that this online vendor would provide me with good service. .73

Perceived Social Presence

The following question are related to the extent to which people perceive social presence in a website

PSP_1.1 There is a sense of human contact on this website. .88

PSP_1.2 There is a sense of sociability on this website. .87

PSP_1.3 There is a sense of human warmth on this website. .85

Eigenvalues 3.59 1.66

% of variance 51.39 23.84

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The means were compared between gender and it could be observed from the output that indeed respondents that had the chat box perceived a higher degree of social presence than the control group. The results showed a slightly bigger difference for females respondents. It can be drawn a conclusion that in fact the manipulation worked and having a chat box made people perceive social presence to be at a higher level. Below in the table 2 the numbers that show this difference are presented.

TABLE 2: MEAN COMPARISON

4.4 CORRELATION MATRIX

The correlation matrix illustrates through Pearson Coefficients what it is the intensity of the relationship between the variables of the study and the meaning of it. Results are presented below in table 3 and 4.

The relationship between the two variables (perceived social presence and trust) is a weak one as the Pearson correlation coefficient r= .35. Due to the positive relationship it can be argued that once a variable increases in value, the second variable does the same. However there is a statistically significant correlation between the two variables (p<.01). In other

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words there is a significant relationship between perceived social presence and trust because the Sig. 2 tailed level is .000 and the relationship is a positive 35.8% that proves that as long as one variable increases, the other one will follow. Table 2 will illustrate these results for male respondents.

The relationship between the two variables is a strong one as the Pearson correlation coefficient r= .55. Due to the positive relationship it can be argued that once a variable increases in value, the second variable does the same. Also, there is a statistically significant correlation between the two variables (p<.01). In other words there is a significant relationship between perceived social presence and trust because the Sig. 2 tailed level is .000 and the relationship is a positive 55.5% that proves that as long as one variable increases, the other one will follow. Table 3 will illustrate these results for female respondents.

TABLE 3: MEANS, STANDARD DEVIATIONS, CORRELATIONS (Gender: Male)

Variables M SD 1 2 3 4 5 6

1 Trust 3.26 1.18 .35 .87

2Perceived social presence 4.12 1.44 - .35 .85

**. Correlation is significant at the .01 level (2-tailed)

Table 4: MEANS, STANDARD DEVIATIONS, CORRELATIONS (Gender: Female)

Variables M SD 1 2 3 4 5 6

1 Trust 3.44 1.04 .55 .87

2Perceived social presence 3.87 1.39 - .55 .85

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4.5 LINEAR REGRESSION

As a way to test hypothesis 1 which investigates the independent variable (perceived social presence) in the interaction with the dependent variable of this study (trust), a simple linear regression was conducted.

To summarize the output of the analysis it could be stated that 11.9% of trust that consumers have in the website is explained by perceived social presence. The regression model as a whole is significant as it has an F score of 14.820 and a significance level of 0.000. The relationship between perceived social presence and trust is positive (B = 2.058, SE = .333) and based on the p-value (.000) it can be concluded that this linear positive relationship is statistically significant. To draw a conclusion on the model, perceived social presence is the predictor variable which was statistically significant (β=0.35, p<.001). In other words, if social presence increases for one, trust will increase for 0.35. Therefore, the Hypothesis 1 was accepted. Perceived social presence has a direct positive relation with trust. Table 4 will present below these numbers that belong to the male group.

To present the main findings of the analysis it could be stated that 30.9% of trust that consumers have in the website is explained by perceived social presence. The regression model as a whole is significant as it has an F score of 52.656and a significance level of 0.000. The relationship between perceived social presence and trust is positive (B = 1.842, SE = .235) and based on the p-value (.000) it can be concluded that this linear positive relationship is statistically significant. To draw a conclusion on the model, perceived social presence is the predictor variable which was statistically significant (β=0.55, p<.001). In other words, if social presence increases for one, trust will increase for 0.55. Therefore, the Hypothesis 1 was accepted.

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TABLE 5: LINIAR REGRESSION MODEL (MALE GROUP)

R R2 R2 Change B SE Β T

Perceived social presence .35 .12*** 19*** .35 .33 .49 6.17

*p<.05; **p<.01; ***p<.001

TABLE 6: LINIAR REGRESSION MODEL (FEMALE GROUP)

R R2 R2 Change B SE Β t

Perceived social presence .55 .31*** .30*** .41 .057 .55 5.93

*p<.05; **p<.01; ***p<.001 4.6 SIMPLE MODERATION

The second hypothesis of the study was tested as a simple moderation process that has been theorized by Preacher & Hayes (2004) and has been used as a SPSS macro.

Taking into consideration the results of the analysis there has to be concluded that the interaction is not statistically significant (p= .2106), thereby the analysis should not continue to the next step in the phase. Therefor, the second hypothesis has been rejected and according to this study gender is not a moderator in the interaction between the independent variable of the study: perceived social presence and the dependent variable is trust. The results of the model have been summarized in table 6.

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TABLE 7: SIMPLE MODERATION

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5. DISCUSSION

Gefen and Straub (2003) demonstrated that whenever consumers perceive a degree of social presence this will have an effect on online buyers' trust and their consequent expectation to buy from a E-commerce website.

The main purpose of this research was to examine whether chat-box which is considered to be a useful tool when website designers try to create a sense of social presence has indeed a direct effect on people’s level of trust. Moreover based on different studies it is believed that gender differences may appear in the online environment and there are different perceptions on various subjects between males and females. So, with this study one might say it was an attempt to investigate if indeed there is actually a relationship between these variables.

In line with previous studies, the regression conducted, illustrated that perceived social presence has a positive significant effect on the level of trust. The findings provide clarity on this relationship, as higher levels of perceived social presence will positively influence initial trust. However, when gender has been included in the model to try and test whether it moderates the connection, there has been found no statistic significance.

In light of the literature review and results section, an exhaustive discussion is displaced below. To begin with, it will be directed an examination of the findings relevant to literature as well as some managerial implication will be drawn from the main results of this paper. Additionally, a few limitation of this study together with some proposals for future research will be suggested.

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5.1 ACADEMIC RELEVANCE

Gefen and Straub (2003) demonstrated that when consumers perceive a high degree of social presence it has an effect on their trust in that website, extensively on the business. This thesis contributes to the existing literature on perceived social presence and trust by shedding more light on the nature of this relationship and also by investigating the moderator role of gender and whether it could be argued that gender differences affect this relationship.

One of the major contribution of this study is that chat box is an important tool of social presence and by adding it in design of the website, consumers perceive it as having a high level of social presence and thus, their trust is increased. These results support earlier findings in the literature, for instance the study of Gefen and Straub (2003), Cyr et al. (2007). However the difference with these studies is that they tested this interaction for digital products such as airline and concert tickets, whereas this research extends the study to the e-commerce environment, more exactly the first page of a website that sells photo equipment has been created.

Most prominently, this work analyzed particular interface designs that could potentially impact the effect of perceived social presence. Past work has recommended that social presence has an important part in the online environment, however it was not examined how some instruments of social presence can be controlled through the interface design of the website. Specifically, the study demonstrated that chat box has a positive impact on the perception of social presence and subsequently on the trust construct.

Nonetheless, this thesis’ findings did not support the moderation effect of gender on the relationship between the independent variable social presence and the dependent variable, trust. One possible explanation could rely on the fact that differences between males and females are yet researched and no information is available on how genders behave in an

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online environment, more particular a website that has in its component design tools of social presence. Perhaps women and men do not have gender specific preferences anymore, this might have become obsolete in today’s society. Be that as it may, when means were compared in SPSS, it showed that there is actually a difference, not a significant one, but still a slightly difference between females and males. It seemed that when women had the website with the chat box they perceived a higher level of social presence, therefore a higher degree of level of trust.

Choosing to conduct the research within an internationalized environment and having students as a sample may have been a good decision as they are the Internet-savvy and are more aware of the potential tools that the Internet has to offer for them.

5.2 MANAGERIAL IMPLICATIONS

The findings of this research have some important managerial implications. Firstly, due to the fact that social presence by the means of a chat box has a great influence on building trust, this should be a valuable finding especially for the managers of a new website where creating awareness and customer relationships matter the most. Hence, they must acknowledge the importance of social presence as the more consumer perceive social presence the greater their trust, it is a positive relationship between the two so this must shows them in what to invest their time and resources as well.

Secondly, the marketing efforts of the managers ought to be focused on the people who are regular internet users as they are going to be the most often consumers because they are considered to be the ones most likely to trust an online shopping website. Therefor, by communicating by the means of social media to potential consumers the target market can be reached and as these consumers have a higher degree of level of trust they are going to be a profitable market.

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On top of that, by comparing the means it has been illustrated that females perceive social presence on a higher level when chat box is present in the website, therefor their level of trust is higher. Marketers can conclude from this that the website that sell products mostly bought by female consumers, products that are more suited for them like make-up tools, personal care should have in their design component an online chat box. As a result women could perceive online shopping more interactive and their willingness to buy products in this manner could potentially increase as their level of trust is higher.

In order to boost their sales, marketing managers that have to launch a new website or upgrade the current one should consider increase the level of social presence as it strongly related to the level of trust. Everyone is aware of the fact that when people trust a website they will make purchases and are more likely to recommend it to others.

Consequently, these findings could have a substantial impact on the way marketers and web designers establish ecommerce websites. There is indeed a positive relationship between perceived social presence and the level of trust when they get the ability to shop or simply visualize an e-commerce website. Hence, companies should take this into account so that they can create the most effective website that enhances customer experience.

5.3 LIMITATIONS AND SUGGESTIONS FOR FUTURE RESEARCH

The major limitation of this research paper is that there was not conducted a real time experiment, the respondents were only presented with a picture of a website and had to answer a small number of questions. Accordingly, as respondents were not actually making a purchase or not even simulated one, the risks associated with a real transaction decreased, therefor it can be said that, potentially, it can have an impact on trust formation. An experiment that involves a real context of online shopping with real purchases with all the

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risks associated should be performed in order to test whether the level of trust will be different.

Another potential limitation is that this study only used one type of tool of social presence which is chat box, indeed it is the most extreme form of social presence, however future research can investigate whether smaller amount of social presence such as images, videos have the same level of influence and test which tool has the most influence. Moreover different tools of social presence can be combined, for instance chat box with images and see if this addition can increase the power of chat box.

In view of the fact that in this research it will be used a non-probability convenience sample, one of the major limitations is that the generalizability of the data is reduced in comparison with convenience sample that offers the possibility to collect larger data in a short timeframe. Additionally this study is limited to a sample consisting only of students that may not be considered representative for all online consumers. Therefor, the study can be replicated using a different sample size, a larger one and use respondents in different age groups to have a greater generalizability of the results.

Considering time constraints this thesis did not analyze brain activities when investigating the relationship between the variables. Hence one might want to look deeper and research if there are patterns that occur at brain level. Further research can test what should be the effect of social presence when using the latest fMRI and also neuromarketing technology.

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6. CONCLUSION

While there are some undeniable and noteworthy contrasts amongst traditional and online shopping settings, customers in these situations share a typical requirement for social interaction. An essential component of traditional shopping is the ''experience'', where malls have become entertainment centers with communities'' (Kumar and Benbasat, 2002). Sherry (1990) argues that a customer's mission for a pleasurable pursuit is frequently significantly more imperative than the purchase of the item itself. Others have affirmed the significance of hedonic shopping value (Babin et al., 1994; Roy, 1994), which is specifically affected by social associations with different people (Jones, 1999; McGrath and Otnes, 1995). Thus, this and other late researches (Gefen and Straub, 2003; Jarvenpaa and Todd, 1997; Kim, 2002) affirm that online customers additionally desire for socially rich involvement.

While some small degree of online sellers, at present fuse some social components in their website pages, most e-merchant offerings are utilitarian with practically zero social interest (Gefen and Straub, 2003). While it appears to be certain that e-sellers may be in advantage by adding social components to their online stores, distinctive products and consumer segments may decide the degree of this advantage. Thus, e-merchants ought to evaluate the effect of joining such components through controlled experiments and with delegate customer gatherings.

Despite the fact that the amount of Internet customers is uniformly divided among males and females, a greater number of men than women participate in web based shopping and make online buys (Rodgers and Harris, 2003). This gender gap in web based shopping attracted thoughtfulness regarding what part plays gender in the web shopping activity and which are

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the components that influence men's and women’s aim to purchase on the web (Rodgers and Harris, 2003; Sanchez-Franco, 2006; Van Slyke, Comunale, and Belanger, 2002). This is precisely why this thesis focused on gender as the moderator to test whether there is actually a difference relating to social presence and whether a conclusion can be drawn that a relationship between these 3 variables takes place.

The hypotheses were tested with the use of different types of analysis: regression and process, however only one was accepted which conveyed the fact that the higher the level of perceived social presence, the higher the level of trust appears to be which means it is a direct positive relationship and has a statistically significance. Besides this relationship, no significant associations were found for the moderator which implies that gender does not affect this relationship and there is no statistic significance which can be explained by the fact that maybe , simply there is no relationship and that consumer behavior may not be explained by gender differences. Nowadays, maybe there are no gender specific preferences at least not on this topic related to the tools that are put at the disposal of the user of a online shopping website. Hence this thesis is adding scientific knowledge only on the effectiveness of chat box as a tool of social presence and their effect on trust.

The findings of the present research have both academic and managerial implications. First, it shed light on the nature of the relationship between perceived social presence and trust in a website. Existing literature suggests that a high degree of social presence positive influence the level of trust and the findings of this thesis point out to the same conclusion. Additionally, the results are valuable as the context of the website differs from what the existing literature has results in, as the other researchers focused on digital products whereas this thesis focus was an e-commerce environment and therefore the results may be generalized to different types of retail products sold online.

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Finally marketers and managers should appoint website designers that ought to add tools of social presence as it is proved that sales can be increased. It is particularly important for new websites due to the fact that people firstly should have a certain degree of trust before buying something online from any store, thus chat box is a good tool of social presence and as mentioned earlier the higher the level of perceived social presence the higher the level of trust.

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