TRUST IN ONLINE SHOPPING :

A DESCRIPTIVE STUDY IN UiTM MELAKA

MUHAMMAD FAKHRUL SYA BIN SAPARUDIN

NUR AIN HAMIZAH BINTI MAZLINA
FATIN NADIA BINTI OMAR
NUR ZAINATULHANI BINTI MOHAMAD

BACHELOR OF BUSINESS ADMINISTRATION

(HONS) INTERNATIONLA BUSINESS
FACULTY OF BUSINESS MANAGEMENT
UNIVERSITI TEKNOLOGI MARA
KAMPUS BANDARAYA MELAKA
1.0 Abstract
In this study, we discussed about the trustworthiness of UiTM KBM students towards
online shopping. From a thorough research, we have formulated the problem statement,
research question, research objectives, theoretical framework as well as hypothesis for
our study. Through literature review, we have construct a theoretical framework that
outline the factors that influence the trustworthiness of UiTM KBM students toward
online shopping. In this study, we want to examined the three dimension that involve in
customer trust towards online shopping that includes perceived risk, perceived web
quality and service quality that may affect the behavior of the consumer in doing online
business. As of our study is focussed on student of UiTM KBM because of using of
internet is increasing among students and their increasing purchasing power. Thus, this
will contibute to the opportunity for the online business to pursue its market towards
student.
If the online business producers know what are the factors that will boost the customers
buying behaviour, and how it can relate to the output of their busniness thus, it will
increase the companys profit and revenue.

2.0 INTRODUCTION
2.1 Background of Study
Most people in many developed and developing nations are touched with the positive
impacts of online business. The tendency to get involved with online business is
encourage via the technological advancement that happen around the globe.
Everybody can feel the heat of this leisure that finally can become a lifestyle to
someones life. We can see that nowadays we can get internet access almost limitless.
We can surf internet from everywhere and anywhere. Thus, online business can be
done for any minutes that we want. This convenient is such a great opportunity for
producers or online business sellers to spread their businesses locally or even
worldwide. With internet, the world is on our control. This topic of benefits of online
business is one of interesting topic to be discussed upon because it will reveal a lot of
hidden advantages that sometime people tend to overlooked. The researcher would
study about the benefits of online business that both consumers and producers will
get.
2.2 Problem Statement
The problem statement of our study is that online shopping nowadays faced a lot of
issues due to the lack of trust among buyers to shop online due to the awareness
about their information security. This problem is supported by research done by Kini
and Choobineh (1998) suggested that trust in the Internet business is necessary for an
Internet buying behaviour to take place. The consumer must also trust the transaction
medium for online shopping. The review of empirical studies has outlined different
factors which influence online purchasers behaviour. For example, those buyers are
afraid of online scammer that will steal their information and used it in a wrong way.
This problem if not overcome wisely will give negative effect to the online business
parties eventually. Somehow, there are still people who do trust to precede their
purchases via online business.

3.0 Literature Review

We choose to study the trustworthiness of UiTM KBM students towards online shopping
as our main interest and apply it as the dependent variable in our research. We are aiming
to explain the factors that have significant relationship with this dependent variable by
relating it with three independent variable. In this research we studied the three factors
which are overall perceived risk, website quality and service quality which is also defined
by Shergill and Chen (2005) in their study conducted in New Zealand. According to a
study conducted by Mathwick (2002), he found that if consumers enjoy their online
shopping experience, they have a more positive attitude toward online shopping, and are
more likely to adopt the Internet as a shopping medium. As for our first independent
variable in our study is perceived risk, second is perceived web quality and lastly is
service quality perception.
First independent variable is the perceived risk. We choose this variable because risk
is significantly related in conducting online shopping and cusrtomer will have to bear
certain degree of risk when conducting online shopping. Risk such as fraudulent will
affect customer perceptions towards online shopping. Other factors related to risk is
regarding security and privacy risk because customer might be afraid if their personal
information might get exposed if they provided their details to the online shopping
provider. For an example, if a customer has experienced of being cheated in doing online
shopping, this will affect their behavior in doing more online shopping in the future. This
variable is supported by Jarvenpaa and Todd ( 1996 ) which outline the personal risk
which refers to the harmful personal consequences to the consumer resulting from online
shopping and defined this type of risk as transaction data leakage. They also explained
about the privacy risk in which refers to the personal private information leakage when
offered to the online shopping provider.
Second independent variable is the perceived web quality. We choose this variable
because the web quality and design will attract and convince the customer to shop at the
web site. The web site must shows it security measures such as customer registration or
log in procedure required in order to satisfies the customer in terms of security in

conducting online shopping in their web site. Overall website quality of a web page is
one of the most important factors that influence online shopping. Shergill and Chen,
(2005) identified web site design characteristics as the dominant factor which influences
consumer perceptions of online purchasing. Other than that, the web site design and
quality will also attract the customer in doing shopping online. This is supported by Kin
and Lee (2002) that explained about the appeal of the user interface and design presented
to customer and customers will be interested to visit more often and stay longer with
attractive web sites interface.
Third variable for this study is service quality perception. We choose this variable
because the service quality offered by the online shopping provider will determine
whether the quality meets or exceeds the consumers expectationt. This variable is
important to study the perception of the service quality offered comparing to the
consumers expectation of the service. This variable can be seen through interaction
between the service provider of the online shopping and its customer in delivering the
service or product intent by the consumer. This is supported by Parasuraman, Zeithaml
and Berry (1985), they stated that the service quality is the excellence level generated
from the interaction between the service provider and the customer in the service delivery
process performance.

4.0 Theoretical Framework

4.1 Schematic diagram of theoretical framework

Perceived risk

Perceived web quality

Trustworthiness

Service Quality

Independent Variable

Dependent Variable

4.2 Hypothesis
Hypothesis for the theoretical framework are according to the various independent
variable identified :
Perceived Risk
H0 :

There is no relationship between the perceived risk and the trustworthiness of

UiTM KBM students toward online shopping.

H1 :

There is a relationship between the perceived risk and the trustworthiness of

UiTM KBM students toward online shopping.

Perceived Web Quality

H0 :

There is no relationship between the the perceived web quality and the
trustworthiness of UiTM KBM students towards online shopping.

H1 :

There is a relationship between the the perceived web quality and the

trustworthiness of UiTM KBM students towards online shopping.

Service Quality Perception

H0 :

There is no relationship between the service quality perception and the

trustworthiness of UiTM KBM students towards online shopping.

H1 :

There is a relationship between the service quality perception and the

trustworthiness of UiTM KBM students towards online shopping.

5.0 Research Methodology

5.1 Research Design
Purpose of The Study
In this study, we aim to identify the factors that may affect the trust of the UiTM KBM
students towards online shopping. We have discussed to use descriptive study in order to
investigate our problem. In the descriptive study, we will be able to describe the
characteristics of the variables of our studies. We can describe it by reviewing the
journals. In this research, we are curious to study what UiTM KBM students perception
and their level of trust towards online shopping and will be supported by the research
objective and research questions.

Types of investigations
In this research, we will choose correalational study as our method of investigation. It is
widely used in a situation where important factors that associated with the problems need
to be identify in order to determined the relationship between the independent and
dependent variables in our research.

Study Setting
Correlational studies is closely related to the natural enviroment where work proceeds
normally. This is called noncontrieved settings where usually a correlational studies are
anvariably conducted. It is also called as a non-control study where observation is
commonly used. Correlational studies conducted in noncontrieved settings are called field
studies in which included a minimal interferences. In this study, we aim to investigate the
trust of UiTM KBM students toward online shopping. In a simpler words, we foreseen
that our field of studies are consistent with our research where various factors that

influence the perception and trust of UiTM KBM students are examined in the settingg in
which daily activities are proceeds as usual with minimal researcher interferences.
Unit Of Analysis
In this study, we are going to study the trustworthiness of UiTM KBM students on the
online shopping. Thus the unit of analysis in this study will be the students of UiTM
KBM in general and we are interested in individual perception towards online shopping.
It wil be refers as the aggregation of data collected during the data analysis.

Time Horizon
In this study, we want to use a one-shot or cross sectional studies where the data will be
gathered once rather than over a period of days or weeks or longer. The purpose of this
studies is to collect data that would be important to answer the research question as data
collection at a point of time is sufficient.

5.2 Data Collection

Method of collecting the data
Primary Data
Primary data refers to information in which obtained first hand by the researcher on the
variables of interest for the specific purposes of the study. In our research, we will use
questionnaire as the primary data of resources to collect the information and data from
the sample that we will randomly select. In order for us to know the perception and
trustworthiness of UiTM KBM students towards online shopping, the quetionnaire will
be distribute among the sample size of the population of our study which is the UiTM
KBM students.
Secondary Data
It is refer to the information gathered from sources that already existing such as
publication, journal and etc. As for our study, we use journal as references because it
helps as a guidance to make literature review and support each variables explanation.

5.3 Sampling Design

Population
Population refers to the entire group of people, events or things interest that the
researcher wishes to investigate. Information about population parameters may be
obtained by taking census or sample. The population of this study are the student of
UiTM KBM student which consist of about 3400 students.
Sample size
We selected our sample size according to Krejcie and Morgan table. As of total UiTM
KBM student is 3400 and the sample size would be around 346 student will be extracted.
Sampling Method
We are focus on investigating the perception and trustworthiness of UiTM KBM students
towards online shopping. We have choose to use non-probabilty sampling method
because the element of population is selected randomly. We choose convenience
sampling which refers to information collection from members of population in which the
UiTM KBM students that amount to 3400 students and we will select only around 340
student that will provide the feedback conveniently. It is usually used in exploratory
phase of a research priject where it offers no precision or generalizability.

5.4 Data Analysis

Once the necessary data is being collected, we will analyse and summarized the data in a
readable and easily interpretable form. We will use the Statistical Package for the Social
Science (SPSS) software to summarized the data. Besides that, we will used the computer
to ensure the accuracy is maintained at all statistical procedure. The tabulation with SPSS
is to complete the data collected for further analysis.

Besides that, data could be

presented in frequency, mean, mode, median, coefficients and other parts of tests
conducted using SPSS. We will used reliability test, descriptive test, significant

coefficients and regression to obtain the data. Data for this study were analyzed using
frequency counts and percentages.
6.0 Contribution of research

As mentioned earlier in this proposal, there are three factors that affect the
trustworthiness of consumer towards online shopping. First factor is the perceived risk of
doing online shopping. We believed that by conducting this research will help people to
learn more about the knowledge on the security of conducting online shopping thus will
attract more people on doing online shopping.
Second factor is the perceived web quality that reflects the perceptions of consumer
towards online shopping website and quality of the website that will influence their
acceptance on the online shopping medium. Through this research, online shopping web
provider or advertiser can learn the behaviour of consumer and their perceptions
regarding the website they tend to believed in and have trust towards it. The seller can
obtain knowledge on how they can design their website in order to attract consumer to
use their website as preferred website to shopping online.
In this globalization era, people use internet in their daily life but limitation on
certain circumstances. Not all users rely on the online business in their daily life. It is
because they lack of knowledge in the process or transaction of the online shopping. They
have negative perception or uncertainty for online shopping. Behavioural scientists have
proposed that rational consumers will first determine the possible risk that may be caused
by certain purchase decisions and only when the consumers think the benefits they get
outweigh the possible risks will they make this purchase decision (Mitchell, 1999). For an
example, they didnt know how secure is their transaction made through online and will
the advertiser or the seller really send the items that they bought through online. This
kind of perception will affect their trust towards online business.
This study will also will contributes in changing the consumer behaviour or
perceptions regarding online business thus making online shopping more reliable and
dependable business medium near future. Our scope of research focus more on UiTM

societies so that we hope this study can shows the behavior and perception on online
shopping of UiTM student and staffs itself.
8.0 Budget

No.

Item

Publication cost

Amount (RM)

Proposal Printing

Questionnaire Printing (RM 0.1 x 50)

Journal Printing

15

Final Report Printing

15

Stationery

10

TOTAL

50

9.0 Conclusion

In our study, we are aiming to study the relationship between consumers especially
in UiTM societies perceptions on the factor that influence them to have trust in doing
shopping online. More specifically, consumers perceptions of the risk, web design and
quality and customer loyalty of online shopping that will reflects their behaviour in doing
online shopping and measure their trustworthiness in online shopping that grows rapidly
recently.
Prior to our research proposal, many literature that we have go through stated that
most researcher opined that there is significance relationship between consumer
behaviour towards the success of online shopping platform. Consumers nowadays are
wiser than before so that they will not easily shops as there is many possible
consequences. They have their own preferences and perception in shopping online. The
factors that influence them include the perceived risk in conducting the shopping online
and also the presentation or delivery of information from the marketers to the consumers
in terms of web design and quality. Other factors include the customer service provided
that will shape the consumer behaviour towards online shopping.

In conclusion, we hope that our research will be benefited by all consumers and
increase their knowledge pertaining to the issue in doing shopping online. In addition,
this research will also serve as a platform that will lead to the sustained confidence of the
consumers in online purchasing.

This study will also will contributes in changing the consumer behaviour or
perceptions regarding online business thus making online business more reliable and
dependable business medium near future. Our scope of research focus more on UiTM
societies, so that we hope this study can shows the behaviour and perception on online
shopping or business of UiTM student itself.
References

Jarvenpaa, S.L., and Todd, P.A., (Winter 1996-1997), Modeling consumer retail
behavior on the World Wide Web, Journal of Electronic Commerce, 1(2), 59-88.
Kin, D. and Lee, I., Trust-related arguments in internet stores: A framework for
evaluations, Journal of Electronic Commerce Research, Vol.4, No.2: 49-64, 2002
Parasuraman,A., Zeithaml, V.A., and Berry L.L.,(Fall 1985), A Conceptual Model of
Service Quality and its Implications for Future Research, Journal of Marketing,49, (4),
42-45.
Shergill, Q., and Chen, W., Attitude Toward the Site: New Information,
Journal of Advertising Research, Vol. 42, No. 2: 33-45, 2005.
Kini, A.. And Choobineh, J., Trust in electronic commerce: Definition and theoretical
considerations, Proceedings of the 31st Hawaii International Conference on System
Sciences, pp.51-61, 1998
Mathwick, C., Understanding the Online Consumer: A Typology of Online Relational
Norms and Behavior, Journal of Interactive Marketing, Vol.16, No. 1: 40-55, 2002.