The Effect of Seller Reputation on Buyer Intentions and Attitudes in Online C2C Service Marketplaces

Abstract: Online C2C service marketplaces are one of the most recent forms of peer-to-peer exchange, enabling consumers to offer and purchase services to and from other consumers. As services move to an online environment, while being offered by unknown sellers, uncertainty and risk often grows in the eyes of the buyer. To decrease the risk perceived by buyers and to increase the credibility of sellers, platform providers have created reputation mechanisms to collect and aggregate feedback provided by buyers in to seller reputation scores. These reputation scores supposedly function as a trust-builders between the buyer and seller, hopefully leading to increased exchange between the actors. The purpose of this thesis is to explore and understand the effects of seller reputation on buyer intentions and attitudes in online C2C service marketplaces. More specifically, the aim is to investigate whether or not (1) a well-built seller reputation creates higher intentions and attitudes towards the purchase and the seller, (2) source credibility of the seller can help explain the effect of a well-built reputation on said intentions and attitudes, and (3) conditions, such as service involvement or buyer characteristics, influence how seller reputation and source credibility affect the intentions and attitudes of buyers. A quantitative study was conducted by a survey method, measuring respondents' reactions to different stimuli regarding seller reputations and services at hand. In addition, personal characteristics of respondents were included as moderators in the research. Reputation, in this study context, is assumed to translate to, the level, and amount, of ratings. The results indicate that an increase in seller reputation had a direct positive effect on buyer attitude towards purchase, behavioral purchase intention and attitude towards seller. However, the effect on buyer willingness to pay for service was not found significant. Seller source credibility was found a relevant mediator between seller reputation and buyer intentions and attitudes, meaning that a good seller reputation does indeed build the seller's source credibility in a service marketplace setting, and that in turn has positive effects on how buyers feel about the seller and purchasing from them. Conditional influencers, namely level of service involvement, buyer disposition to trust and buyer risk avoidance, did not have as prominent effects as expected, but did affect certain relationships between seller reputation, source credibility and buyer intentions and attitudes. To conclude, it can be said that when available information is scarce, seller reputation (rating score) does indeed carry significant value in an online service marketplace context in affecting certain buyers attitudes and intentions towards seller and purchase, thus making reputation mechanisms in an online service marketplace context a highly interesting topic in future research as well as in business practice.