By Dr Hong Kay Tze and Dr Khoo Kim Leng
According to ecommerceDB, by 2027, the e-commerce market is projected to reach a volume of US$14,060.6 million, with a compound annual growth rate of 13.2%. This trend of growth is also expected to continue globally in the coming years. In 2020, The Malaysia Communications and Multimedia Commission found that the penetration rate of smartphone users in Malaysia for 2021 was 94.8%.
This means that accessing applications is quick and may be a contributing factor to the growth of e-commerce. Additionally, there are various other factors that contribute to the widespread adoption of e-commerce by consumers.
The consensus is that e-commerce plays a significant role in generating considerable revenue and fostering the expansion of Malaysia’s economy. However, it is of utmost importance for business owners to acknowledge that consumer attitudes and preferences hold greater influence over purchase choices than mere affordability and convenience.
Besides providing value to consumers, e-commerce fraud is another factor that affects their purchasing decisions. Malaysia has already reported 4,000 cases of e-commerce fraud in May 2022. In 2021, Statistic also shared that Malaysian consumers reported a 63% increase in online scams, with 9.57 thousand cases, compared to 5.85 thousand in 2020.
The main question here is how consumers decide which sites to buy from. The underlying aim here is trust, which is a belief that the other party will act in a favourable manner and that it will not cause any damage to you. Four aspects of an e-commerce site should do or have to improve consumers’ trust.
Firstly, to ensure consumers trust the site, the perception of the consumers needs to be managed, which is whether the customer thinks the store is honest, cares about them and can deliver their promises. A reputable site should be known for being honest and fair in business, as well as being consumer-oriented such as quick to respond to customer inquiries and feedback, great service, and fast delivery.
Secondly, customer knowledge regarding any e-commerce platform also impacts customers’ perceived trust towards the site. Knowledge refers to the condition of knowing or being familiar with something obtained through learning, experiences or word-of-mouth.
Customers should be familiar with purchasing online, what are the site’s transaction modelsand security aspects, and should provide a seamless and easy to understand experience within their site. Helping customers to know or learn about your site is important, as it givesthem the confidence to purchase at the site.
Thirdly, website quality is one of the elements to build customer trust. Website quality entails whether the merchant or the online purchase site offer quality information and the type of interface sought after by customers.
To improve this, an interesting and straightforward web design is needed to provide easy to find, accurate, and up-to-dateinformation on the products should be ready for customers. Finally, all this information should be helpful and reliable to the customer, and then trust can be enhanced.
Lastly, system assurance is also part of building customers’ trust in your e-commerce platform. Ensure the online transaction system is always secure, stable, and dependable.
This is to guarantee consumers that their personal details and payment information areprotected and safeguarded from any cybercrime actions during the transaction process on the internet. Site managers must implement security policies and procedures to protect online customers.
Ultimately the above practice will lead to improved trust from online patrons. Coupled with peer influence or word of mouth, customers’ trust towards a site can be heightened. Therefore, sites constantly encourage online customers to leave a review after purchasing, as most patrons claim that they will trust and buy from sites with good reviews or more reviews.
In conclusion, trust plays a crucial role in e-commerce, particularly when customers purchase from unfamiliar online merchants without the ability to physically examine the product. By following these precautions, consumers can significantly reduce the risk of falling victim to scams and enjoy safer e-commerce transactions.
Dr Khoo Kim Leng is a lecturer and Dr Hong Kay Tze is an adjunct academic at the School of Management and Marketing, Faculty of Business and Law, Taylor’s University. Taylor’s Business School is the leading private business school in Southeast Asia for Business and Management Studies based on the 2024 QS World University Rankings by Subject.
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