Consumer trust, perceived security and privacy policy

Abstract

PurposeThe purpose of this paper is to analyze the effect of privacy and perceived security on the level of trust shown by the consumer in the internet. It also aims to reveal and test the close relationship between the trust in a web site and the degree of loyalty to it.Design/methodology/approachFirst, there is an explanation of the main attributes of the concepts examined, with special attention being paid to the multi‐dimensional nature of the variables and the relationships between them. This is followed by an examination of the validation processes of the measuring instruments.FindingsSpecifically, the study reveals that an individual's loyalty to a web site is closely linked to the levels of trust. Thus, the development of trust not only affects the intention to buy, as shown by previous researchers, but it also directly affects the effective purchasing behavior, in terms of preference, cost and frequency of visits, and therefore, the level of profitability provided by each consumer. In addition, the analyses show that trust in the internet is particularly influenced by the security perceived by consumers regarding the handling of their private data.Practical implicationsThe results of this study provide several managerial implications for companies in this sector. Suggestions are offered for national and international organizations involved in regulating these markets.Originality/valueThe results of this research remedy, to a certain extent, the scarcity of empirical studies that have designed and validated measuring scales for the concepts of privacy, security, trust and loyalty to the internet, as well as testing the relationships between them.