The Influence of Merchant Reputation on Consumer Decisions to Shop Online

Merchant reputation is a collective measure of trustworthiness derived from a combination of received referrals and consumer past purchase experience. The positive influence of merchant reputation on consumers’ responses and attitudes has received much attention, particularly in terms of the connection between trust and merchant reputation. This paper focuses on how merchant reputation shapes consumer decision-making in online shopping, through an analysis of the perceptions of a select group of online consumers and merchants. The research reveals that merchant reputation has more influence on consumer confidence and trust than on the decision to shop online, but only if it is directly supported by peer recommendations and feedback. Indeed, reputation has a direct influence on consumer confidence and trust, which then indirectly affects the decision to shop online.