Case Study A – The Benefit of a Trust Seal

A large study (250,000 transactions at nearly 500 online retailers) of transactions at different online stores, with Trust Seals showing for approximately 50% of the customers concluded that the presence of trust seals at online retailers’ websites increases the completion likelihood of shopping carts, thus resulting in increased sales for the retailers displaying the seal.  They concluded that –

  1. The presence of a Trust Seal at a retailer’s web site increases the odds of cart completion at that web site by 14.11%, and increased revenue by 10.25%.
  2. Smaller online retailers benefit more from the presence of a Trust Seal than larger online retailers. (The additional risk perceived by shoppers due to small retailer size is partially mitigated by the presence of the trust seal)
  3. Trust Seals are more important to new customers than to repeat customers.  ie novice shoppers feel more comfortable when the online retailer displays the seal on its website
  4. The use on only 1 Trust Seal is optimum. Sales decrease if websites show 2 or more Trust Seals. (The presence of too many seals may make the shoppers skeptical about the online retailer’s trustworthiness)
  5. Trust Seals were effective at increasing cart completion for all websites – there was no connection between the cart value (price of goods) and the effect of the Trust Seal (the researchers had hypothesised that Trust Seals might be more relevant for more expensive transactions – but their research results showed this wasn’t correct)

“The risk that originates from information asymmetry perceived by consumers when shopping from an unknown retailer is partially mitigated when a trusted third party endorses the quality claims of the online retailer through a trust seal. The seal acts as an additional quality signal for the online retailer and reduces the amount of information asymmetry faced by the shoppers, thereby easing the purchasing decision of the shoppers.” (p 21) [ref]The Value of Online Trust Seals: Evidence from Online Retailing by Özpolat, Gao, Jank and Viswanathan[/ref]