Perceived Risk and the Technology Acceptance Model: A Proposed

Study for e-Commerce Adoption

Winarto

and Maludin Panjaitan

Faculty of Economics, The Methodist University of Indonesia

Keywords: Perceived usefulness, perceived ease of use, intentions to use, TAM, IS adoption

Abstract: Electronic-commerce (e-commerce) nowadays has become an important platform for conducting business.

While researchers and market practitioners are trying to fully understand online consumer attitude and

behavior, one of the current issues in the management of information technologies is the difficulty of

recognizing significant factors that affect consumers to adopt, accept and continue to use the information

technologies. A model that commonly used by the researchers to examine behavior in the information system

field is the technology acceptance model (TAM), which consists of 3 variables; perceived usefulness (PU),

perceived ease of use (PEOU) and intentions to use. In this study, we propose the extension of the TAM for

its application in the e-commerce field. The original variables of technology acceptance model will be

modified, by adding a moderator variable, perceived risk, which is expected to strengthen or weaken the

relationship between perceived ease of use, perceived usefulness and behavioral intention.

1 INTRODUCTION

Your paper will be part of the conference proceedings

therefore we ask that authors follow the guidelines

explained in this example and in the file

«FormatContentsForAuthors.pdf» also on the zip file,

in order to achieve the highest quality possible

(Smith, 1998).

Electronic-commerce (e-commerce) nowadays

has become an important platform for conducting

business. Research shows that the commercial trade

development through the Internet has astonishingly

transformed the retail industry since 1990 (Chen &

Chang, 2003) due to the usage of the Internet in the

contemporary era as a means of transaction for

consumers in the global market (Delafrooz, Paim, &

Khatibi, 2011). While researchers and market

practitioners are trying to fully understand online

consumer attitude and behavior, one of the current

issues in the management of information technologies

is the difficulty of recognizing significant factors that

affect consumers to adopt, accept and continue to use

the information technologies. A model that

commonly used by the researchers to examine

behavior in the information system field is the

technology acceptance model (TAM), which consists

of 3 variables; perceived usefulness (PU), perceived

ease of use (PEOU) and intentions to use.

The technology acceptance model is based on the

Theory of Reasoned Action (TRA) and theory of

planned behavior that seeks to explain behavior

intention to use information system (Grandón, Nasco,

& Mykytyn Jr, 2011). This model has been widely

used by information system researchers because of its

understandability and simplicity (King & He, 2006),

although the model also has drawbacks. For instance,

Lim and Tang (2012) noted that findings of TAM

relationships are not borne out in all studies, and there

remains a wide variation of predicted effects in

various studies with different types of users and

systems. As a result, there are some modified or

extended models that have been developed to fully

understand the information system adoption, for

example the unified theory of acceptance and use of

technology (UTAUT) model (Venkatesh, Morris,

Davis, & David, 2003), the integration of risk and

trust on TAM model (Pavlou, 2003).

Over decades, information researchers have

closely examined factors that affect information

system adoption. However, little is known about the

acceptance of online shopping and the factors which

influence this behavior in the developing countries;

and what factors that can strengthen or weaken the

information system adoption. This study attempts to

478

Winarto, . and Panjaitan, M.

Perceived Risk and the Technology Acceptance Model: A Proposed Study for e-Commerce Adoption.

DOI: 10.5220/0010045104780482

In Proceedings of the 3rd International Conference of Computer, Environment, Agriculture, Social Science, Health Science, Engineering and Technology (ICEST 2018), pages 478-482

ISBN: 978-989-758-496-1

fill in this gap by providing insights on how

consumers form their online shopping intentions, and

the intentions are transformed in to actual use of e-

commerce. In addition, this study also will explore

the moderation effect of perceived risk; a factor that

possible can hinder the e-commerce adoption. The

original variables of technology acceptance model

will be modified, by adding a moderator variable,

perceived risk, which is expected to strengthen or

weaken the relationship between perceived ease of

use, perceived usefulness and intention to use. Based

on the study background that has been explained, we

formulate 3 research questions that will be answered

in this research. The research questions are:

1. Does perceived ease of use significantly influence

intention to shop online in an e-commerce

platform, and is the relationship moderated by

perceived risk?

2. Does perceived usefulness significantly influence

intention to shop online in a e-commerce

platform, and is the relationship moderated by

perceived risk?

The proposed research has several purposes to

achieve:

1. To examine the relationship between perceived

ease of use and intention to shop online in an e-

commerce platform. Further, the research also

investigates the moderation effect of perceived

risk on the relationship between between

perceived ease of use and intention to shop online

in an e-commerce platform.

2. To examine the relationship between perceived

usefulness and intention to shop online in an e-

commerce platform. Moreover, the research also

investigates the moderation effect of perceived

risk on the relationship between between

perceived usefulness and intention to shop online

in an e-commerce platform.

2 LITERATURE REVIEW

2.1 e-Commerce Adoption

As the innovation of technology, e-commerce

develops rapidly in recent years. Fast spreading of the

Internet has made the e-commerce an indispensable

and effective tool to realize the commercial

transactions. E-commerce is described like to make

production, presentation, selling, insurance,

distribution and payment transactions of the goods

and services in the electronic domain (Çelik &

Yılmaz, 2011). The simplest meaning of the e-

commerce is described as buying and selling of the

goods via the Internet. For instance, consumers could

purchase clothes from online shop, they could order

football tickets through the internet order systems,

and they could buy anything from the online stores no

matter where they are now. Whereas e-commerce has

become an important issue with the growth of the

Internet, there are insufficient empirical studies to

explore consumer behavior in the e-commerce

platform, particularly the customer behavior to

accept, adopt and continue using e-commerce

platform.

In this study, we mainly focus on the B2C e-

commerce platform, where companies provide the

goods or services in the Internet directly and offer

sufficient information and convenient interface to

attract consumers to buy online in order to eliminate

channel intermediaries (Wawan, 2013). In Indonesia,

e-commerce is growing rapidly. Bhinneka.com

became the pioneer for –commerce platform in

Indonesia. Several e-commerce platforms followed,

such as Berniaga.com, TokoBagus.com (now it is

olx.com), Tokopedia.com, Bukalapak.com,

Blibli.com (Widjaja & Tedjawidjaja, 2012).

Although there are more and more e-commerce

platform, and other online shopping or ticketing sites,

there are not so a lot empirical studies to examine the

e-commerce adoption. This study is trying to fill in

the gap, specifically to get more insights on the e-

commerce adoption.

2.2 The Technology Acceptance Model

The Technology Acceptance Model (TAM) is very

popular modeling approach in information system

research. Originally, the Technology Acceptance

Model (TAM) was developed by Davis (1989), which

purposely explains the computer usage behavior in

order to predict technology acceptance. The TAM

suggests that beliefs in a technology are related to

users’ attitudes and their decision to adapt the

technology. Davis (1989) describes how people adopt

and accept new technology applications. In TAM, it

is hypothised that the perceived usefulness and

perceived ease of use predict intention to use

information technology which, in its turn, is believed

to affect the adoption of technology. Further, TAM

shows that perceived usefulness and perceived ease

of use improves the users adoption of the technology.

The general model of technology acceptance is

depicted below:

Perceived Risk and the Technology Acceptance Model: A Proposed Study for e-Commerce Adoption

479

Figure 1: The Technology Acceptance Model

Figure 1 shows the 2 variables; perceived

usefulness and perceived ease of use; which influence

the intention to use information technology.

Perceived usefulness is defined as the degree to which

a person believes that using a particular system would

enhance his or her job performance and perceived

ease of use is defined as the degree to which a person

believes that using a particular system would be free

of effort (Davis, 1989). Due to its understandability

and simplicity (King & He, 2006), the model has been

widely used by information system researchers to

examine the user adoption toward information

system. In fact, the model has limitations due to wide

variations of predicted effects, and this drives the

information system researchers to modify the original

model.

2.3 Perceived Risk

While the Internet offers online consumers with

additional way for searching information of products

and services, it still has some issues to be solved. For

example, when consumers do shopping on the

Internet, they cannot feel, watch, and touch the reality

of the products or services before they buy what they

need. They may worry about the safety and the

security of transmitting credit card information via

the internet when the payment should be made. It is a

problem that consumers perceive lack of security,

safety and privacy on the internet in the adoption of

electronic commerce. Internet users hope that the e-

commerce providers on the Internet could assure the

transaction security. Thus perceived risk is an

important factor should be taken into account on the

e-commerce adoption.

Previous research has examined the relationship

between the perceived risk of a new shopping channel

and the choice of purchasing using that channel

(Bhatnagar, Misra, & Rao, 2000). By definition, there

are 2 major components; the probability of a loss and

the subjective feeling of unfavorable consequences.

2.4 Hypotheses Development

The purpose of TAM is to explain and predict the

acceptance of information technology based on two

specific behavioral beliefs: perceived ease of use

(PEOU) and perceived usefulness (PU). Since TAM

has been applied to the transactions of electronic

commerce, it may help us to understand the context

of adopting electronic commerce.

Perceived usefulness is the individual’s

assessment of the utility offered by using new

information technology in a specific context.

Perceived usefulness in the TAM model reflects task-

related productivity, performance, and effectiveness.

Perceived ease of use refers to the degree to which the

user expects the target system to be free from effort

(Davis, 1989). The concepts of perceived usefulness

and perceived ease of use are individual subjective

judgments about the usefulness and ease toward

specific system.

The TAM posits users think that it is beneficial to

use the technology in completing his/her work; and

when users perceive the ease of using information

systems, there is likely that users will intent to use the

information system. However, due to the nature of e-

commerce platform, risk is one of the aspects that

may hinder the information system adoption.

Previous research use perceived risk as the factor that

influence user intention to use information system; on

this research, we use perceived risk as a moderator

variable which will strengthen or weaken the

relationship between perceived ease of use, perceived

usefulness and intention to use. Thus, we arrive at the

following hypotheses:

Hypothesis 1: Perceived ease of use is related to

customer intention to shop online in a e-commerce

platform. The relationship is moderated by perceived

risk; if perceived risk is high the relationship between

perceived ease of use and intention to shop online in

a e-commerce platform will be weaken.

Hypothesis 2: Perceived usefulness is related to

customer intention to shop online in a e-commerce

platform. The relationship is moderated by perceived

risk; if perceived risk is high the relationship between

perceived ease of use and intention to shop online in

a e-commerce platform will be weaken

Perceived

Usefulness

Perceived Ease

of Use

Intention to

use

ICEST 2018 - 3rd International Conference of Computer, Environment, Agriculture, Social Science, Health Science, Engineering and

Technology

480

3 RESEARCH MODEL

Figure 2 depicts the research model which

summarizes the research questions. The first research

question consists of three independent variables and

one dependent variable. Finally, the gender difference

in satisfaction is examined.

Figure 2 the Technology Acceptance Model

4 MEASUREMENT

Table 1 shows the research indicators that will be

used in the research questionnaire.

Table 1: Research Indicator

No Variables Empirical indicators

1 Perceived

ease of

use

1. I find most online shopping sites

easy to use.

2. I find it easy learning to use most

online shopping sites.

3. I find it easy to use most online

shopping sites to find what I want

4. I find it easy to become skilful at

using most online shopping sites

5. I find it easier to compare

products when shopping at online

retailers.

6. I feel that most online shopping

sites are flexible to interact with.

7. I am able to browse online

shopping sites with ease.

2 Perceived

usefulness

1. I am able to accomplish my

shopping goals more quickly

when I shop online.

2. I am able to improve my

shopping performance when I

shop online (e.g. save time or

money).

3. I am able to increase my

shopping productivity when I

shop online (e.g. make purchase

decisions or find product

information within the shortest

time frame).

4. I am able to increase my

shopping effectiveness when I

shop online (e.g. get the best deal

or find the most information

about a product).

5. I find the website of online

retailers useful in aiding my

purchase decisions. Shopping

from online retailers improves

my purchase decisions.

6. Shopping from online retailers

makes it easier for me to satisfy

my needs.

3 Intention

to shop

online in

a e-

commerce

platform

1. It is likely that I will continue to

purchase products from online

retailers in the future.

2. I intend to continue purchase

products from the Internet in the

future.

3. I would likely visit an online

shopping site to shop for my

needs.

4. I plan to do more of my shopping

via online shopping sites.

5. When I need to buy a particular

product, I would search for an

online retailer which has the

product.

6. There is a substantial chance that

I would purchase the same

product from an online retailer.

7. There is a substantial chance that

I would purchase different

products from an online retaile

4 Perceived

risks

1. How would you characterize the

decision to transact with this Web

retailer? (Significant

risk/insignificant risk)

2. How would you characterize the

decision to transact with this Web

retailer? (Very negative

situation/Very positive situation)

3. How would you characterize the

decision to buy a product from

this Web retailer? (High potential

For loss/High potential for gain)

ACKNOWLEDGEMENTS

This is a proposed research project that will be funded

by Lembaga Penelitian dan Pengabdian Masyarakat

Universitas Methodist Indonesia. We would

appreciate any comments or suggestions that will help

us to enhance and improve the research.

REFERENCES

Bhatnagar, A., Misra, S., & Rao, H. R. (2000). On risk,

convenience, and Internet shopping behavior.

Association for Computing Machinery.

Communications of the ACM, 43(11), 98-105.

Perceived

Ease of Use

Intention to shop

online in a

e-commerce

platform

Perceived

Usefulness

Perceived Risk

Perceived Risk and the Technology Acceptance Model: A Proposed Study for e-Commerce Adoption

481

Çelik, H. E., & Yılmaz, V. (2011). Extending the

Technology Acceptance Model for Adoption of E-

Shopping by Consumers in Turkey. Journal of

Electronic Commerce Research, 12(2), 152-164.

Chen, S.-J., & Chang, T.-Z. (2003). A descriptive model of

online shopping process: some empirical results.

International Journal of Service Industry Management,

14(5), 556-569.

Davis, F. D. (1989). Perceived Usefulness, Perceived Ease

of Use, and User Acceptance of Information

Technology. MIS Quarterly, 13(3), 319-340.

Delafrooz, N., Paim, L. H., & Khatibi, A. (2011).

Understanding consumer’s internet purchase intention

in Malaysia. African Journal of Business Management,

5(3), 2837-2846.

Featherman, M. S., & Pavlou, P. A. (2003). Predicting e-

services adoption: a perceived risk facets perspective.

International Journal of Human-Computer Studies,

59(4), 451–474.

Grandón, E. E., Nasco, S. A., & Mykytyn Jr, P. P. (2011).

Comparing theories to explain e-commerce adoption.

Journal of Business Research, 64, 292–298.

King, W. R., & He, J. (2006). A meta-analysis of the

technology acceptance model. Information &

Management, 43(6), 740–755.

Li, Y.-H., & Huang, J.-W. (2009). Applying theory of

perceived risk and Technology Acceptance Model in

the online shopping channel. World Academy of

Science, Engineering and Technology, 29, 913-919.

Lim, W. M., & Ting, D. H. (2012). E-shopping: an Analysis

of the Technology Acceptance Model. Modern Applied

Science, 6(4), 49-62.

Moon, J.-W., & Kim, Y.-G. (2001). Extending the TAM for

a World-Wide-Web contex. Information &

Management, 38, 217-230.

Pavlou, P. A. (2003). Consumer acceptance of electronic

commerce: Integrating rrust and risk with the

Technology Acceptance Model. International Journal

of Electronic Commerce, 7(3), 69-103.

Venkatesh, V., Morris, M. G., Davis, G. B., & David, F. D.

(2003). User acceptance of information technology:

Toward a unified view. MIS Quarterly, 27(3), 425-478.

Wawan, M. (2013). Technology acceptance of e-commerce

in Indonesia. International Journal of Engineering

Innovation and Management, 3, 9-18.

Widjaja, D. N., & Tedjawidjaja, A. (2012). A Preliminary

Study of Merchants’ Intention to Adopt Online

Payment Gateway in Indonesia. International Journal

of Future Computer and Communication, 1(2), 155-

159.

ICEST 2018 - 3rd International Conference of Computer, Environment, Agriculture, Social Science, Health Science, Engineering and

Technology

482