One of the major challenges facing all online retailers, especially small online retailers, is how to initiate consumer trust. This study examines the nature of this unique type of consumer trust by proposing the concept of “cue-based trust.” It also examines the signaling role of various cues in building initial trust and the behavioral consequences involved. A 25–1 factorial experiment was conducted with sample size of 402 to explore the signaling effects of five cues of interest in this study: seals of approval, return policy, awards from neutral sources, security disclosures, and privacy disclosures. The online study supported the signaling roles of most of these cues. Findings can be summarized as follows: (a) security disclosures and awards from neutral sources were found to enhance cue-based trust which, in turn, positively influenced two behavioral responses—bookmarking intentions and willingness to provide personal information, and (b) seals of approval and privacy disclosures were found to directly encourage consumers’ willingness to provide personal information while awards from neutral sources were found to directly encourage bookmarking intentions. Implications for online retailers and future theoretical studies are discussed.

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The research presented here extends the traditional theoretical model of service failure and service recovery to the online shopping environment by investigating the moderating role of cumulative online purchasing experience. Using a multigroup structural equation modeling approach to assess differences across two groups with low and high levels of online purchasing experience, the study provides empirical support that cumulative online purchasing experience moderates several key attitudinal and behavioral outcomes of the service failure/recovery encounter. Specifically, in the group with less online purchasing experience, the perceived fairness of the remedy offered by the seller has a greater impact on post-recovery satisfaction. Further, if dissatisfied following a service failure encounter, the group with low levels of purchasing experience is more likely to engage in negative word of mouth. Finally, post-recovery satisfaction is more predictive of repurchase intentions in the highly experienced group than the less experienced group.

Purpose -This study seeks to explain a buyer's response to a seller's violation of trust. Four negative responses (decline in trust, negative emotions, negative word-of-mouth (WOM) and reduction in repurchase intentions) and four explanatory variables (magnitude of violation, integrity versus capability-based cause of failure, perceived likelihood of repeated violations and stage of trust prior to the violation) were identified. The study develops and tests hypotheses regarding the possible influence of the explanatory variables on each of the four negative responses. Design/methodology/approach -An experiment was conducted in which business professionals were given one of 16 scenarios, varied by levels of the four explanatory variables, describing a violation of trust in a business-to-business service situation. Respondents were asked questions regarding their probable response. Four-way ANCOVA was used to analyze the results. Findings -The study finds that stage of trust and perceived likelihood of repeated violation had significant main effects on decline in trust, negative WOM and repurchase intentions. Integrity-based attribution influenced decline in trust, but magnitude of violation had no main effects. Three significant interactions were found. Research limitations/implications -Findings show the importance of first impressions and reputation. Care should be taken to assure customers that violations will not be repeated. A major limitation was that scenarios cannot induce the same intensity of thought and emotion that real situations do. Originality/value -Despite extensive literature in service failure and recovery, this is perhaps the first study to rigorously examine and seek to explain a buyer's response to a seller's violation of trust.

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