Marketing and Management on the Internet and Mobile Media
Edited by Teemu Kautonen and Heikki Karjaluoto
Chapter 6: Online Auctions: A Review of Literature on Types of Fraud and Trust Building
Fahri Unsal and G. Scott Erickson INTRODUCTION The number of global Internet users had reached 1.1 billion (17 per cent of the world population) by early 2007 with 207 per cent growth from 2000 to 2007 (Internet Usage, 2007). Given such growth rates, online activity will continue to increase dramatically in the next decade, and individuals will use the Internet for a variety of purposes including email, chat, research, video communication, online banking, electronic commerce and online auctions. In the United States, where electronic commerce is most prevalent, the total value of online purchases in 2006 was estimated at $109 billion US dollars by the Census Bureau (Retail EC, 2007). This was a 23.5 per cent increase from 2005, a much higher growth rate than the 5.8 per cent increase in retail sales in the bricks-and-mortar environment. One should note, however, that online sales still account for only 2.8 per cent of total sales. Still, rapid growth in Internet access and electronic commerce is also occurring in many developed countries such as Canada, Australia and many Western European countries. Although e-commerce activities are less common in developing countries because of culture, low credit card ownership and general distrust in online buying, rapid growth should occur during the next few decades, as aﬀordable Internet technology becomes more readily available and users become more comfortable with the concept. A common classiﬁcation of electronic commerce is based on the relationship between participants. These include business-to-business (B2B), business-to-government (B2G), business-to-consumer (B2C), consumerto-consumer...
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