Trust in collaborative consumption - exploring the implications of website quality and feedback mechanisms

Current environmental degradation and global recession have increased the demand for alternative ways to consume. Simultaneously, the rise of Internet has made establishing online-based communities easy and cost-effective. These factors have impacted on consumers' consumption habits, and consequently, the phenomenon of collaborative consumption has emerged. The phenomenon is growing in popularity at a fast pace all around the world, and constantly more companies are entering the market with the aim of tap into the increasing demand. However, without trust these businesses are unlikely to succeed - trust between strangers is one of the fundamental principles of collaborative consumption, and trust has been found to be a key factor in e-commerce success in general by several studies. The objective of this thesis is to provide with an insight into understanding the phenomenon of collaborative consumption and to empirically explore the role of trust in collaborative consumption platforms. While the literature review discusses the phenomenon as a whole, the subcategory of collaborative lifestyles was chosen for closer empirical analysis, and housing rental peer-to-peer service Airbnb was used as a case company. Trust is studied as a mediator between the chosen trust antecedents, i.e. perceived website quality and perceived effectiveness of feedback mechanisms, and a consequence of trust, i.e. a consumer's intention to participate in collaborative consumption. Also, the study includes perceived risk as a mediator, as suggested by several previous online trust studies. A quantitative empirical research was conducted in order to test the hypotheses and validity of the chosen constructs that were based on previous literature. The data for the analysis was collected through an online survey in April 2016, yielding 183 responses. Structural equation modeling was used for analyzing the data. Based on the results, trust, in fact, is an important factor when consumers are making decisions to participate in collaborative consumption. The results indicate that both website quality and perceived effectiveness of feedback mechanisms affect consumers' behavioral intent indirectly through trust. In addition, perceived effectiveness of feedback mechanisms has also a direct impact on consumers' decision to participate in collaborative consumption. Trust was found to have a strong negative causal relationship with perceived risk which, however, do not seem to effect on consumers' behavioral intent. Potentially consumers ignore the perceived risk due to their other motivations to participate, such as utility seeking. This research both confirms and challenges the findings of previous online trust studies in a novel context. The research provides with several practical implications for both managers and users of collaborative consumption platforms. Understanding the antecedents and consequences of trust is important in order to create successful collaborative consumption services. Also, increased understanding help users to improve their position in the marketplace. The thesis provides also with several suggestions for further research on this current and interesting topic.