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Reputation and Internet Auctions: eBay and Beyond

[Snijders and Zijdeman, 2004]

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Introduction

• Real auction vs. Online auction• The issue of trust• Reputation systems• Different studies, different findings

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Trust

Four elements- Placing trust provides trustee with resources- Trustor is better off placing trust- Placing trust is voluntarily and without

safeguards- Time lag between placing trust and honouring

it

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Trust: seller characteristics

Reputation can improve trust, 3 assumptions:1. Winning buyer always provides feedback

after sale2. This feedback should be honest3. Seller behaviour should be stable over time

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Trust: seller characteristics

Reputation assumptions not realistic because:- Harder to give negative feedback, danger of

retaliation- Possible to give positive feedback when

negative is appropriate- Behaviour is not stable over time- As reputation increases incentive to behave

correctly decreases

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Trust: buyer and product characteristics

Buyer:• Experience with prior transactionsProduct:• Trustor needs more certainty with risky products• Value of products• Used or new• Photo• Packaging• Still depends on trust in description or seller

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Contextual factors

Auction characteristics:• Payment methods• Bidding increment/reserve price• Shipment costs• Auction timeSite characteristics:• Reputation• Fees

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Remarkable results of other studies

• Sometimes reputation score negatively correlated with selling price

• Results are very diverse

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Research reproduced

• Mobile phones• 4 sites: Ricardo.nl, eBay, ePier, XQL

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Results

Reproduction of results did not lead to same results:• Different variables in data• Different opperationalization of reputation score in

data• Different products under study

Some research did not account for heteroscedasticity. Ater doing so, a small ans significant effect for reputation score on selling price was found.

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Recomendations

… for selling a product:• Picture• Function description• Experience vs no experience• Used vs new

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Discussion

• More variables• Account for different operationalizations of

reputation score• Think about different products under study• Difference between used and new products• Account for difference between sites

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On-line Reputation Systems: The Effects of Feedback Comments and Reactions on Building and Rebuilding

Trust in On-line Auctions[Sonja Ulz, Uwe Matzat, Chris Snijders]

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(Re)building trust

• Majority of eBay users read at least 1 page of feedback about a seller

• Noise: Differences between actual and intended outcomes due to unintended errors

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Trust violation

• Competence-based violation• Morality based violation

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Experiment

2 Scenarios• Broken product• Delayed delivery

3 types of feedback• Denial• Apology• No feedback

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Discussion

• Other ways of building trust• Do these results hold for online auctions in

general or are the results only for eBay?

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Findings

• Perceived trustworthiness higher for less severe violations.

• Plain apology leads to higher trustworthiness• The effect of feedback on trustworthiness are

mediated by believability