The lockdown-accelerated mass migration to e-commerce has exposed consumers to higher risks of online shopping scams and cyber-fraud – mainly because right now there is no single source of information for shoppers to assess whether or not online brands are trustworthy.
Buyer's regret: Consumers are looking for a convenient and reliable indicator on brand trustworthiness to help them make better choices, the research found.
Research funded by the Optus-Macquarie University Cyber Security Hub – and led by Dr Stephanie Huang, Senior Lecturer in Marketing and Associate Dean (Curriculum and Learning) at Macquarie Business School – has developed a prototype online solution to this problem, dubbed the Brand Trustworthiness Index (BT Index).
“In Australia, more than $4 million was lost to online shopping scams in 2019 by choosing the wrong product, the wrong brand or dodgy outlets,” says Huang.
“Consumers are shopping online more than ever. While the choices are greater, we are not necessarily making better decisions because we simply don’t have enough information.
More than $4 million was lost to online shopping scams in 2019 by choosing the wrong product, the wrong brand or dodgy outlets.
“Our research project, which began in 2020, found consumers simply cannot read all the consumer review data appearing in multiple places,” says Huang. “Social media platforms can also present wildly divergent reviews. And even if they had the time, consumers cannot process all this information as there is no common theme.”
Huang’s team used Airbnb as their main research case. They manually collected 13,447 consumer reviews on 263 accommodations in Canberra and used this data, together with simulated data representing other sources, to develop an algorithm to calculate trustworthiness.
Huang says the research discovered that consumers are looking for a convenient and reliable indicator on brand trustworthiness to help them make better choices. She offers a common buying decision as an example.
“Let’s say you are trying to buy a mobile phone online. You are looking at bargain brands to save money and you come across an online shop you are not familiar with. You check the consumer review data on the website and the three reviews are all positive. You order the phone but it turns out to be of crappy quality.
“Had you been able to investigate more thoroughly this might not have happened. Other reviewers may have left more telling and realistic reviews on other websites.
“You ended up making a poor purchase decision because of a lack of access to full consumer review data.”
Consumer reviews collected and analysed
Together with her collaborators, Professor Jian Yang (Department of Computing) and Associate Professor Hume Winzar (Department of Actuarial Studies and Business Analytics), Huang aims to develop the BT Index as an aggregator of multiple sources of consumer review data.
Down the rabbit hole: Dr Huang's research project found online shoppers simply cannot read all the consumer review data appearing in multiple places.
It uses ‘big data analytics’, the process of uncovering trends, patterns and correlations in large amounts of raw data to help make data-informed decisions.
“The BT Index is a synthesis of multiple consumer reviews,” says Huang. “It is purely consumer-driven. More recent consumer reviews and product/brand attributes that are more frequently commented on by consumers will receive more weight in the calculations.
“The Index provides a straightforward rating of how reliable – or trustworthy – a brand is. And it is dynamic, in that it is driven by what consumers are saying.
“As the reviews and review criteria change, so does the algorithm,” she says. “These adjustments make the BT Index more reliable. The Index doesn’t tell consumers what is more important; it lets other consumers tell them.”
Good for companies too
“The BT index could also benefit companies as it provides information about how consumers are talking about – and responding to - their brand, says Huang. "And because it’s dynamic, they could closely monitor their brand performance and respond quickly to customer experiences. They would also be able to recognise an emerging problem and intervene before it became a crisis.”
Huang hopes the BT Index will eventually be available as an application on different digital platforms.
“We have presented our research to a few industry partners and received very positive feedback,” she says.
“How we finally embed the BT Index in shopping websites will be the next phase of the project.”
Dr Yimin (Stephanie) Huang (pictured) is Senior Lecturer in Marketing and Associate Dean (Curriculum and Learning) at Macquarie Business School
