Trust formation and transference in social commerce

The growth of e-commerce has shifted to online social network websites in the last six years. Benefiting from the advantages of the interactive information technology infrastructure in online social network, social commerce is regarded as a new category of e-commerce. Many e-retailers have extended their businesses onto the social network (via social commerce) in the belief that social commerce will in time become the dominant mode of commerce. One key challenge in establishing social commerce as a dominant mode of commerce in the online context is the ability to build and maintain trust between consumers and businesses. The purpose of this research study is to investigate trust formation and transference in the social commerce context setting. The research is conceptually framed by relational and trust transference theories. To execute the study, a two-stage (sequential) design encompassing a quantitative as well as a randomised experimental design was employed. Firstly, trust formation was investigated with a cross-sessional questionnaire survey (stage 1) to identify key determinants of trust (cognition-based trust, affect-based trust, personality-based trust and institutional-based trust) and the consequences of a consumer’s trust beliefs in terms of trust-related behaviours. Secondly, a Solomon four-group experimental design (stage 2) was implemented to examine the impact of trust transference in an individual’s trusting behaviour towards different levels of social friends (i.e. direct friend, friend-of-friend, friend-of-friend-of-friend, and virtual friend) and different types of message framings (i.e. matched and mismatched positive and negative recommendations) in the social commerce context. In stage 1, structural equation modelling analysis using Analysis of Moment Structures (AMOS) reveals that cognition-based trust, affect-based trust, personality-based trust and institutional-based trust are significant trust domains in social commerce that encourage individuals’ trust beliefs and intention to engage in social commerce activities and social commerce adoption. Building on the first part of the study, data analysis using Braver and Braver’s meta-analytical procedure in stage 2 reveals that six scenarios show treatment effects. Analysis of Variance (ANOVA) tests show that social relations play a major role in trust transference in the social commerce context. More specifically, the recommendations (regardless whether the message is aligned or contradicted with the feedback of other experienced consumers) from strong-tie (i.e. direct friend) relationships appear to have a higher influence and usefulness to change an individual’s decision-making and belief towards a retailer.