C2C ONLINE AUCTION WEBSITE PERFORMANCE: BUYER’S PERSPECTIVE

ABSTRACT Despite the popularity among millions of users around the globe of selling, bidding, and buying products using C2C online auction websites, the existing literature on online auctions provides us with little understanding on important factors of the C2C auctioneer website performance. One way to understand the performance factors of C2C auction websites could be to extend the past theories of end user computing satisfaction from the buyer perspective. The current study develops a research framework for measuring C2C online auction website performance by identifying factors which influences C2C auction buyer's satisfaction and net benefit. Based on the research framework, we develop measurements and empirically test C2C auction website performance with a sample size of 131 C2C online auction buyers. Our empirical results indicate that the C2C auction website content, user friendliness (a combined measure of C2C auction format and ease of use), timeliness, security, transactions, and product varieties are positively related to the website performance for the auction buyers. Implications of the current study and potential for future studies are also discussed. Keywords: online auction, EUCS, ISSM, website performance 1. Introduction An interesting phenomenon of online sales had been the widespread usage of C2C online auction websites that attract millions of users around the globe to sell, bid, and buy everything from baby diapers to airline tickets. In 2007 alone, a total of US$59 billion was transacted on eBay, one of the most popular C2C online auction websites. The popularity of C2C auctions can be attributed to the simplicity and efficiency in price negotiation - one of the most frustrating parts of the purchasing process between the individual buyers and the sellers (Jin & Wu 2004). Unlike the fixed or static purchase price offered at e-stores, online auctions create a dynamic or "fluid" pricing structure for the buyers. Ockenfels et al. [2006] contend that the transaction costs associated with conducting and participating (selling and bidding) in C2C online auctions have decreased substantially to the extent that such online auctions seem worthwhile even when the expected advantage of detecting the true market value of the item is relatively low. The functional and operational characteristics of C2C online auctions are different when compared to other e-commerce businesses. Unlike other e-commerce websites, C2C auctioneers such as eBay and Amazon operate as unaligned third parties, creating a virtual platform for the auction users (i.e. buyers and sellers) to meet and conduct purchase transactions. At eBay alone, millions of sellers add 6.7 million auction listings per day across 50,000 product categories [eBay 2008]. Auction websites, therefore, do not participate in actual selling of the products or services [Chong and Wong 2005]). In contrast to consumers utilizing e-stores, C2C auction users are involved in dynamic, real-time and complicated decision situations to sell and buy not only regular products but also rare, discontinued, unique, and antique products [Ockenfels et al. 2006]. C2C online auction users are generally unknown to one another and a long-term buyer-seller relationship is less likely to be found [Ba 2001]. After the bidding is closed, the seller has to wait until the payment from the auction-winner is successfully transferred to his or her account before shipping the product. Because of such non-simultaneous exchange among the trading parties, C2C online auction is also characterized by the introduction of time asymmetry in the business transaction [Chong & Wong 2005] and additional risk for its participants [Chong & Wong 2005; Salam et al. 1998]. User authentication and product/service guarantee remains the greatest challenge in C2C auction environment [Bam et al. 2000; Chong & Wong 2005, Jones & Leonard 2007; Yen & Lu 2008a]. …

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