Influences on Exchange Processes: Buyers' Preconceptions of a Seller's Trustworthiness and Bargaining Toughness

Abstract

Exchange theories posit that trust has an important and favorable influence on dyadic interactions. This paper examines the notion that trust plays a key role in making a seller's tough bargaining strategy successful. In a bargaining experiment, we manipulated subjects' preconceptions about a seller's trustworthiness and bargaining toughness. As hypothesized, a seller's expected trustworthiness-plustoughness in bargaining led to higher levels of buyer-seller cooperation and agreement and a higher level of buyer concessions. F rom Alderson's marketing-as-negotiation concept (1957) to Bagozzi's marketing-as-exchange perspective (1975), the process of buyer-seller interactions has been emphasized as a key feature of consumer or buyer transactions. One approach to illuminating the process of buyer-seller interactions in both consumer and industrial studies requires an examination of negotiation behavior (e.g., Clopton 1984; Dwyer and Walker 1981; Johnston and Bonoma 1984; Mathews, Wilson, and Monoky 1972; Walker 1971). Reingen and Woodside (1981) identify three exchange issues that deserve special attention in interaction-process studies such as bargaining experiments: (1) what happens during communication processes, (2) how do antecedent variables affect communication processes, and (3) what persuasion strategies are useful in influencing buyer-seller interactions. Accordingly, this paper examines buyer-seller communication and concession-making processes as influenced by a buyer's prior beliefs about a seller's trustworthiness and bargaining toughness.Unfortunately, consumer research has devoted little attention to the influence of trust on cooperation, agreement, or bargaining toughness (i.e., unyielding behavior) as a persuasive strategy in buyer-seller transactions. This is surprising, since theories of dyadic

E-commerce: the role of familiarity and trust

“…The early psychology and sociology studies on trust de®ned it as a set of beliefs that other people would ful®l their expected favorable commitments [4,9,28]. Recent business research has taken a comparable stand, de®n-ing trust as the expectation that other individuals or companies will behave ethically [20], dependably [25], and will ful®l their expected commitments [28,38,39] under conditions of vulnerability and interdependence [37].…”

“…It reduces the need for extensive negotiations [10], detail-resolution [10,17], comprehensive legislation and enforced regulation [10], and tight organizational control [1,10]. Trust encourages long-term orientation [10,12,33], increases the acceptance of interdependence [39,43], and creates commitment [32,33,43]. Trust also reduces perceived risk [10,33], can reduce transaction costs when warranted [10,42], and is to some extent important in almost any contractual agreement because of possible opportunistic behavior of the other party [42].…”

“…The observation that people need to trust in order to partake in an activity with another person and would rather refrain from any activity with others whom they do not trust [4,28] further supports these observations. Accordingly, trust in business``is the salient factor in determining the e ectiveness of many relations'' ( [43], p. 229), and is a prime motivator of behavior in general [23,36,39]. Its importance is not only in its role in defusing concerns of opportunistic behavior but also because by defusing such concerns it reduces the need to invest in contractual counter measures [10,17].…”

Dimensions of Internet Commerce Trust

“…Prior to the explosion of the Internet as a revolutionary distribution, promotion, and marketing tool, researchers recognized the multitude of situational factors and noted that trust is both target-and context-specific (Schurr & Ozanne, 1985;Aiken, 1999). Thus, society in the information age (Glazer, 1991) seems to have developed a new form of contextual trust-a form of trust that is characterized by the unique representations of e-consumers and firms as encoded, transmitted, and decoded through an electronics-driven CME (Aiken & Boush, 2006).…”

“…Still, ICT is hypothesized to influence firm-specific trust, as well as choice of shopping mode. For Internet-based firms (so called "pure-play" companies that only conduct business on-line), the relationship ofICT to firm-specific trust should be relatively strong due to the context-specific nature of trust (Schurr & Ozanne, 1985;Swan, Bowers & Richardson, 1999;Aiken, 1999). That is, if someone is mistrustful of Internet commerce as a whole (low ICT), the person will be less likely to trust an Internet firm than would someone with high ICT.…”