Information & Management 39 (2002) 705719

Enticing online consumers: an extended technology

acceptance perspective
Lei-da Chena,*, Mark L. Gillensonb, Daniel L. Sherrellb
a

College of Business Administration, Creighton University, Omaha, NE 68178, USA

b
College of Business Administration, University of Memphis, Memphis, TN, USA
Received 11 January 2001; accepted 8 July 2001

Abstract
The business-to-consumer aspect of electronic commerce (EC) is the most visible business use of the World Wide Web
(WWW). A virtual store allows companies to provide product information and offer direct sales to their customers through an
electronic channel. The fundamental problem motivating this study is that: in order for a virtual store to compete effectively
with both physical stores and other online retailers, there is an urgent need to understand the factors that entice consumers to
use it. This research attempted to provide both theoretical and empirical analyses to explain consumers' use of a virtual store
and its antecedents.
By applying the technology acceptance model (TAM) and innovation diffusion theory (IDT), this research took an extended
perspective to examine consumer behavior in the virtual store context. The data from a survey of online consumers was used
empirically to test the proposed research model. Conrmatory factor analysis (CFA) was performed to examine the reliability and
validity of the measurement model, and the structural equation modeling (SEM) technique was used to evaluate the causal model.
The implication of the work to both researchers and practitioners is discussed. # 2002 Elsevier Science B.V. All rights reserved.
Keywords: Electronic markets; Innovation diffusion; Online retailing; Technology acceptance model; Virtual store

1. Introduction
The advantages of using the Internet for business-toconsumer transactions are clear. The openness of the
Internet is creating opportunities for virtually all companies, ranging from small start-ups to Fortune 100
companies. It is widely utilized to establish general
market as well as niche solutions by these organizations. In achieving these objectives, businesses use the
Internet as a communication, transaction or distribution channel [6,20]. The proliferation of business-toconsumer electronic commerce (EC) in recent years
*

Corresponding author. Tel.: 1-402-280-2614;

fax: 1-402-280-5565.
E-mail address: lchen@creighton.edu (L.-d. Chen).

has resulted in organizations establishing their net

presence through a new retail form: the virtual store.
This is ``a storefront in cyberspace, a place where
customers can shop from their home computers and
where merchants can offer merchandise and services
for a fraction of the overhead required in a physical
storefront'' [67]. It allows companies to provide product information and offer direct sales to their customers through an electronic channel.
Virtual stores come in a variety of sizes and forms.
In general, they can be classied into three categories:
replacement of existing businesses, reengineering of
the internal process of existing businesses, and new
business entities. In the rst category, for example,
Egghead Software Company, replaced their original ``brick and mortar'' stores with entirely online

0378-7206/02/$ see front matter # 2002 Elsevier Science B.V. All rights reserved.
PII: S 0 3 7 8 - 7 2 0 6 ( 0 1 ) 0 0 1 2 7 - 6

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L.-d. Chen et al. / Information & Management 39 (2002) 705719

operations to reduce overhead costs. The second

category probably contains the great majority of
virtual stores in the USA (e.g. www.walmart.com,
www.landsend.com, and www.barnesandnoble.com).
These businesses complement their existing stores
with an online presence to increase the number of
channels for interacting with their customers while
creating new business values at the same time. The last
category includes some of the most vibrant virtual
stores that have helped to shape business-to-consumer
EC as we know it today. Online specialty stores,
www.amazon.com, online general purpose shopping
networks, such as www.buy.com, and online shopping
assistants, such as www.mysimon.com, are all good
examples of these virtual stores. All these new business entities have a heavy dependence on information
technology (IT) in their business strategies. Although
still representing a relatively small portion of total
retail sales, the growth of business-to-consumer EC on
the Internet has been rapid. A study by ActivMedia
found that the average monthly sales revenues for
online business sites were $40,273, an increase from
only $13,620 in 1997 [1].
The question that bafes every business manager
and EC researcher today is: what entices consumers to
use virtual stores? This is the fundamental problem
that motivated study.
The benets of online shopping are well known.
The most common incentives for consumers to shop
online are convenience, broader selections [32,33],
competitive pricing, and greater access to information
[51]. Nevertheless, online sales volume still remains
relatively low compared to alternative retailing forms.
Although the reasons are not clear, some obvious
obstacles are security and privacy concerns [9], lack
of familiarity with the medium [42], and the suitability
of products to be sold [49]. The online retailing market
also has extreme competition. Besides traditional
retail stores, virtual stores are competing ercely with
each other. When virtual stores cannot illustrate the
unique nature of their products and services, price
often becomes the only means of comparison. This
results in destructive price wars among competing
virtual stores [26]. Only a small portion of the virtual
stores will eventually be able to sustain themselves
against competition.
Internet commerce of small business, an important
component of the US economy, is still in its infancy.

The expansion in this sector can be only stimulated by

the realization of long-term business benets by small
businesses [52]. Therefore, understanding the fundamentals of what determines consumer use of virtual
stores can lead to more effective and meaningful
strategies that will allow them to remain competitive
while maintaining bottom line prots.
System use is a recurring issue in IS research. It was
identied as one of the indicators of IS success, and
it is often associated with positive user attitude, such
as user satisfaction. In the context of business-toconsumer EC, system use can be dened at two levels.
The rst involves the search and inquiry of product
information on the store's Web site. The second
depends on the purchasing activities needed in the
virtual store. A previous study found that system use is
a good indicator of the success of commercial Web
sites [39]. While the impact of this is obvious, the
search mechanism has an indirect impact on the virtual
store. Bellman et al. found that consumers who turn to
the Internet for product information are more likely to
purchase from virtual stores; therefore, frequent use of
the virtual store for product search and inquiry will
increase the chance of purchase. They also showed
that high volumes of site trafc are an indicator of the
value of the Web site, and can obviously generate
sizable advertising revenue.
Both types of system use are of great interest to our
study, and understanding consumers' psychological
and behavioral incentives to use virtual stores should
be valuable. Primarily based on two well-established
theories, the technology acceptance model (TAM) and
innovation diffusion theory (IDT), our research was
intended to provide both theoretical and empirical
analysis to explain the factors that determine a consumer's use of virtual stores. The objectives of this
article were two-fold: rst, the validity of some of the
most inuential theories is tested in the new domain of
business-to-consumer EC; second, a new consumer
acceptance framework was empirically tested using a
survey of 253 online consumers.
2. Technology- and consumer-centered view of
online consumer behavior
As online retailing became increasingly common,
researchers started to explore the reasons behind this

L.-d. Chen et al. / Information & Management 39 (2002) 705719

and ways to utilize it more effectively for commercial

purposes. Most of the research takes either a technology- or consumer-centered view as identied
by Jarvenpaa and Todd. The technology-centered
view explains and predicts consumer acceptance by
examining the technical specications of a virtual
store. These specications include a virtual store's
user interface features [40,60,64,66], content and
design [30], usability [46,47], ability to effectively
dialog with consumers [5,8], and security measures
[37,58]. The technology-centered view believes that
online shopping is currently impeded by virtual stores'
unproductive use of technology. The consumercentered view studies online shopping through the
consumers' perspective, investigating consumers'
salient beliefs about it. Such beliefs are supposed to
inuence retail channel selection decisions. Some
broad categories include product perception, service
quality, trust, and shopping experience. This view also
believes that socio-demographic factors play important roles in determining consumer acceptance. This
is inherited from consumer behavior literature on
in-home shopping (e.g. [16,25,50,51]). Studies have
consistently found that gender, income level, computer experience, and use of other in-home shopping
methods inuence a consumer's propensity to shop
online [9,21,31]. Among these studies, one suggests
that a ``wired'' lifestyle drives consumers to shop
online. The rationale behind the consumer-centered
view is that electronic market success is determined by
consumers' willingness to adopt it. Strader and Hendrickson's [61] ability-motivation-opportunity framework implies that in order to achieve e-market success,
consumers must be given the opportunity, ability, and
motivation to participate.
Regardless which view is used, most of the research
ndings on consumer acceptance of virtual stores have
been mixed and inconclusive. This may be due to a
lack of integral theoretical paradigms that can support
such a wide array of technical, business, and personal
issues. Despite the oversupply of ``so-called'' strategies by many articles in trade journals, organizations
utilizing Web strategies for selling their products and
services are nding that their expectation far exceeds
actual achievement [15]. The pursuit of a theoretical
paradigm can start with revisiting some of the most
inuential intention models and innovation diffusion
theories, especially those in the context of technology.

707

3. Theoretical model
A virtual store has been viewed as a new business
model; some researchers have provided analogies
between virtual stores and their physical counterparts.
As both the presence and operation of virtual stores
depend heavily on IT, they are often regarded as a type
of IS. To retailers, virtual stores are their strategic IS,
while to consumers, virtual stores are end-user IS. This
view is justied by previous literature (e.g.
[48,56,60]). Hence, when consumers accept and use
virtual stores, they are accepting and using technologies and innovations. The theoretical constructs are
behavior prediction, user acceptance, and innovation
adoption. Theory of reasoned action (TRA), TAM, and
IDT are among the widely supported theories that
focus on these constructs.
3.1. TRA and TAM
Ajzen and Fishbein's [3] TRA is a well-accepted
intention model that has been proven successful in
predicting and explaining behavior across a wide
variety of domains. Based on TRA, Davis [17] introduced TAM for predicting IT usage. While TRA is
``designed to explain virtually any human behavior'',
the goal of TAM was ``to provide an explanation of
the determinants of computer acceptance . . . across
a broad range of end-user computing technologies
and user populations'' [19]. The model posits that
perceived usefulness (PU) and perceived ease of use
(PEOU) are the primary determinants of system use.
The model hypothesizes that actual system use is
determined by users' behavioral intention (BI) to
use, which is in turn inuenced by users' attitudes
(A) toward using. Finally, attitude is directly affected
by beliefs about the system, which consists of PU and
PEOU.
TAM is among the most inuential and discussed
theories in predicting and explaining end-user behavior and system use. It is one of the base theories for
this study because of its solid theoretical foundation.
A number of recent studies have successfully adopted
TAM to study the acceptance of Internet related
technologies, such as e-mail [24], the World Wide
Web (WWW) [23], and EC. Therefore, using it as the
basis for studying consumer acceptance of virtual
stores is a highly valid approach.

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L.-d. Chen et al. / Information & Management 39 (2002) 705719

3.2. IDT
One theory associated with research on technology
innovation is IDT. It has been widely applied in
disciplines such as anthropology, sociology, education, communication, marketing, etc. [53,54,55]. Diffusion has been dened as ``the process by which an
innovation is communicated through certain channels
over time among the members of a social system'', and
an innovation is ``an idea, practice, or object that is
perceived as new by an individual or another unit of
adoption''. Diffusion is achieved through user adoption, which is ``the acceptance into use and the continued use of a new idea or thing'' [68]. IDT tries to
explain the innovation decision process, the determining factors of rate of adoption, and different categories
of adopters. It helps in predicting the likelihood and
rate of adoption of an innovation. Most of the innovations studied recently are technology innovations (e.g.
[38,44]).
The main contribution of IDT to our study is the set
of innovation attributes. These help to explain the
different rates of adoption by users. The attributes
include: relative advantage, compatibility, complexity,
trialability, visibility, and observability; these ve
attributes have been said to explain 4987% of the
variance in rate of adoption. Previous studies, including the meta-analysis of 75 diffusion articles conducted by Tornatzky and Klein [62], found that
only relative advantage, compatibility and complexity
were consistently related to innovation adoption. Most
online shoppers are considered early adopters of virtual stores. Virtual stores are innovations, because they
have revamped the traditional retail business model.
They also represent a hybrid of business processes and
modern technologies and are exerting an increasingly
greater impact on people's daily lives.
3.3. Relationship between the two theories and this
research
Although they originated in different disciplines,
TAM and IDT have some obvious similarities. The
relative advantage construct in IDT is often considered to be the PU construct in TAM, and the complexity construct in IDT is extremely similar to the
PEOU concept in TAM [43]. This suggests that TAM
and IDT reconrm each other's ndings, which raises

the authors' condence in the validity and reliability

of these theories. TAM and IDT often complement
each other. IDT involves the formation of a favorable
or unfavorable attitude toward an innovation; however, it does not provide further evidence on how the
attitude evolves into the accept/reject decision. TAM,
on the other hand, provides theoretical linkages
among beliefs, attitude, intention, and action. TAM
is criticized for ignoring the social inuence on
technology acceptance. Some empirical studies have
suggested that TAM be integrated with other acceptance and diffusion theories to improve its predictive
and explanatory power (e.g. [29]). For example, one
study expanded TAM to include variables from technology task t (TTF) to assess the t between user
task needs and functionality of the IT [22]. In another
study, Venkatesh and Davis [63] extended TAM to
include variables relevant to social inuence and
cognitive instrumental processes, and the resulting
model was consequently labeled TAM2. Based on
this rationale, TAM and IDT were integrated to
construct the research model for our research (see
Fig. 1).
One important innovation attribute that is not studied in TAM is compatibility. While evaluating this,
one looks at the innovation's compatibility with existing values and beliefs, previously introduced ideas,
and potential adopters' needs. Greater compatibility
results in a faster rate of adoption. This view is also
shared by TTF theory [27,28], which suggests that the
correspondence between IS functionality and task
requirements leads to positive user evaluations. Compatibility is also determined by the norms of a social
system. Jin and Robey [35] found that online retailers
persist as legitimate social institutions because they
conform to society's regulative and normative expectations, and understanding the cyberculture and using
it for their objectives are believed to be the primary
tasks of virtual stores [14]. Therefore, the inclusion of
compatibility in the research model is reasonable. The
other two innovation attributes, trialability and observability, are discarded here because they have not been
found to be consistently related to the rate of adoption
in previous research. The authors also chose to
exclude external variables, such as personality characteristics, demographic variables, or social role, in
the model. This approach is recommended by Ajzen
and Fishbein, who believe that the effects of external

L.-d. Chen et al. / Information & Management 39 (2002) 705719

709

Fig. 1. Proposed research model for consumer acceptance of virtual stores.

variables are often too unstable and tend to change

over time.
The research model adopts TAM beliefattitude
intentionbehavior relationship. These relationships
can be stated in the following hypotheses.
Hypothesis 1. A consumer's BI to use a virtual store
positively affects his or her actual use of the virtual
store.
Hypothesis 2. A consumer's attitude toward using a
virtual store positively affects his or her BI to use the
virtual store.
Hypothesis 3. A consumer's PU of a virtual store
positively affects his or her BI to use the virtual store.
Hypothesis 4. A consumer's PU of a virtual store
positively affects his or her attitude toward using the
virtual store.
Hypothesis 5. A consumer's PEOU of a virtual store
positively affects his or her attitude toward using the
virtual store.
Hypothesis 6. The compatibility between using a
virtual store and a consumer's belief, values and needs
positively affects his or her attitude toward using the
virtual store.
Hypothesis 7. A consumer's PEOU of a virtual store
positively affects his or her PU of the virtual store.

4. Research methodology
Survey research was the predominant methodology
used in this study. The sampling units are individual
online consumers. A questionnaire was developed to
measure the relevant constructs.
4.1. Measurement development
The constructs and their measures are presented in
Table 1, and the list of the items is displayed in
Appendix A. In the last few years, a number of articles
developed and validated instruments for measuring
TAM constructs (e.g. [2,18,57]); therefore, the majority of the items in the instrument were derived from
existing literature. Self-reported measures of behavior
rather than direct observations were used to determine
the actual use of virtual stores, because they are more
convenient to obtain and are free of specic targets,
contexts, or time frames. Moreover, self-reported
measures have been found appropriate for relative
measures and are highly consistent with the objective
measures [4,12].
As the attitude (A) construct is subject-specic, the
items measuring it were developed using the recommendation of Ajzen and Fishbein [3]. They suggested
that attitude be predicted from a person's salient
beliefs. The procedure they proposed was used and
proven successful in many studies. Hence, the present
research implemented the same procedure to measure
a consumer's attitude toward using a virtual store. A
message asking people to participate in a study about

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L.-d. Chen et al. / Information & Management 39 (2002) 705719

Table 1
Constructs and measures
Construct

Definition

Source/reference

Compatibility

The compatibility of using a virtual store with existing values and beliefs,
previously introduced ideas, and potential adopters' needs
The user's subjective probability that using a specific virtual store will
increase his or her performance in purchasing and information searching
The degree to which a user expects the use of the target virtual store
to be free of effort
The user's attitude toward using a virtual store
The user's likelihood to use a virtual store
The frequency of using a virtual store and the approximate number of
times the user uses the virtual store in a given time period

[43]

Perceived usefulness
Perceived ease of use
Attitude
Behavioral intention to use
Actual use

their beliefs about their use of a virtual store was sent

to members on the ISWorld mailing list. This therefore
involves one of the leading US organizations of IS
related practitioners and researchers; hence the results
from the survey are considered expert opinions.
Thirty-one usable email responses were gathered.
From the results of the survey, the most frequently
mentioned salient beliefs include (in the order of
frequency) the following.
1. Using a virtual store is convenient.
2. Using a virtual store saves me time.
3. The fact that I cannot see the actual products
makes me think twice about using a virtual store.
4. Using a virtual store is not secured (insecurity of
nancial transactions).
5. Using a virtual store puts my privacy at risk.
6. Using a virtual store makes me lose social contact
(can be a positive belief or a negative belief).
7. Using a virtual store saves me money.
8. A virtual store has a larger product selection than
traditional stores.
These beliefs are found to have high face validity,
and they are consistent with previous research. Prior to
administering the survey, a pilot test was conducted
among 45 undergraduate and graduate students
enrolled in entry level MIS courses and EC courses
to determine whether the instruments were capturing
the phenomena desired. The sampling choice for the
pilot test insured the inclusion of people with a wide
range of computer and Internet literacy. The results of
this test indicated that some construct revisions were
needed. Therefore, the authors respecied the measurement model by eliminating the problematic items.

[18]
[18]
Survey on salient beliefs [3]
[3]
[3]

The resulting questionnaire consisted of 23 items

measuring the six latent variables.
4.2. Web-based survey
In order to target online consumers, a Web-based
survey was employed. The survey Web site was
designed with high usability to increase response rate
and accuracy [59]. A common gateway interface
(CGI) program was developed to handle the data
collection process. Each respondent was asked to
provide the name of a virtual store that he or she
had used during the last 6 months. The respondent was
then instructed to answer all the questions based on
their experience when using that particular virtual
store. An electronic mail message, which explained
the objectives of the research and contained the link to
the Web-based survey, was distributed to the mailing
lists of 1865 registered users of a non-prot organization and three news groups related to online shopping.
The returned questionnaires were initially screened for
usability and reliability; 253 responses were found to
be complete and usable, rendering a response rate of
13.6%. To minimize data entry errors, all data were
entered twice and checked for consistency.
4.3. Sample characteristics and descriptive statistics
Table 2 summarizes some of the demographic of the
respondents. The characteristics were reasonably consistent with the known proles of online consumers;
this increased the authors' condence in the generalizability of the ndings. Table 2 summarizes selected
sample characteristics.

L.-d. Chen et al. / Information & Management 39 (2002) 705719

Table 2
Selected demographic attributes of the respondents
Frequency

Percent
(%)

Cumulative
(%)

Gender
Male
Female

121
132

47.8
52.2

47.8
100

Age
Less than 20
2029
3039
4049
Over 50

32
126
75
13
7

12.6
49.8
29.6
5.1
2.8

12.6
62.5
92.1
97.2
100

Individual annual income

Less than $15,000
66
$15,00029,999
51
$30,00044,999
76
$45,00059,999
35
Over $60,000
25

26.1
20.2
30.0
13.8
9.9

26.1
46.2
76.3
90.1
100

Residence
Urban
Suburban

57.3
42.7

57.3
100

19.0
37.5
25.3
18.2

19.0
56.5
81.8
100

145
108

Speed of primary Web access

Slow
48
Medium
95
Fast
64
Very fast
46

Household purchase decision-making responsibility

None
6
2.4
Less than half
59
23.3
About half
86
34.0
More than half
69
27.3
Almost all of it
33
13.0

2.4
25.7
59.7
87.0
100

Shopping online
Never shopped
Have shopped

20.6
100

52
201

20.6
79.4

711

A look at the descriptive statistics (see Table 3) of

the ve questions soliciting consumer attitude towards
using a virtual store rendered interesting insights into
consumers' motivation to use one. On average, the
respondents believed that using one is convenient and
saves time. This again conrmed previous ndings.
Opinions were relatively divided about a virtual
store's ability to save consumer's money. While bargains can be found in some, many virtual stores target
well-educated and high income consumers who are
willing to pay a premium for convenience and time
saving. Again, consumers were relatively divided on
the effect of a lack of direct interaction with a product
in a virtual store: products having an established brand
name and standardized products, for example, books
and CDs, are easier to market in virtual stores, because
their characteristics are known and predictable.
Finally, the surveyed consumers on average seemed
to be slightly less concerned with data security issues.
As consumers become more and more Web-knowledgeable, they are better aware of the risks and
liabilities related to online shopping. This knowledge
should promote consumer condence rather than
increase skepticism [34].
5. Data analysis and results
5.1. Measurement model
The data obtained were tested for reliability and
validity using conrmatory factor analysis (CFA). The
measurement model includes 23 items describing six
latent constructs: Compatibility (C), PU, PEOU, attitude (A), BI to use, and actual use (USE). The initial

Table 3
Descriptive statistics of attitude
Attitude item

Mean

S.D.

Rangea

Using (name of the virtual store) is convenient

Using (name of the virtual store) saves me time
Using (name of the virtual store) saves me money
The fact that I cannot see the actual products makes me think
twice about using (name of the virtual store)
Using (name of the virtual store) is not secured

4.365
4.287
3.612
3.096

0.635
0.746
1.079
1.192

35
25
15
15

2.635

1.133

15

5, strongly agree; 4, agree; 3, neutral; 2, disagree; 1, strongly disagree.

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L.-d. Chen et al. / Information & Management 39 (2002) 705719

Table 4
Fit indices for the measurement model for the research model
Root mean square
error of approximation

Root mean
square residual

Normed fit
index

Non-normed
fit index

Comparative
fit index

0.061

0.044

0.91

0.95

0.96

test of the measurement model using CFA indicated

that some construct revisions were needed. After
respecifying the instruments, 18 items were retained.
Compared to the original TAM items, the great majority of the items (9 of 12) were retained after the CFA
was performed. This showed that the data was able to
support TAM in B2C (the business-to-consumer EC)
domain.
The test of the nal measurement model demonstrated good t between the data and the proposed
measurement model. The chi-square for the measurement model was calculated to be 233.2 (P 0:00)
with 121 d.f. Bentler [10] suggested that the CFI
should be the index of choice when assessing the
goodness-of-t of the model. The CFI here was
0.96, which is greater than the 0.90 benchmark suggested by Bentler [11]; therefore, the measurement
model demonstrated good t of the data. The various
goodness-of-t statistics are summarized in Table 4.
In addition to the global measures of t, several
other assessment criteria were considered. The internal consistency of the measurement model was
assessed by computing the composite reliability. All
constructs (see Table 5) had a higher composite reliability than the benchmark of 0.60 recommended by
Bagozzi and Yi [7]. This suggests that a high internal
Table 5
Assessing the measurement model
Latent variables
Compatibility
Perceived usefulness
Perceived ease of use
Attitude
Behavior intention to use
Usage

Composite
reliabilitya

Average variance
extractedb

0.78
0.64
0.84
0.51
0.83
0.56
0.74
0.42
1.00
1.00
0.87
0.77
P 2
P
a
Composite reliability: li varG= li 2 varG
P
yii .
P 2
P 2
b
P Average variance extracted: li varG= li varG
yii .

reliability of the data existed. Along with the coefcients of composite reliability, the coefcients of
average variance extracted are also displayed. The
average variance extracted indicates what percentage
of the variance of the construct is explained by any
individual item. The great majority of the constructs
have average variance extracted higher than the benchmark of 0.5 recommended by Bagozzi and Yi; therefore, it was concluded that the items adequately
explained the variance. Table 6 displays the factor
loadings of the retained items on the constructs that
they were designed to measure.
In summary, the great majority of the retained items
loaded highly on the constructs that they were
designed to measure. The t indices demonstrated
good overall t of the measurement model to the data.
Average variance extracted coefcients suggested that
the items were able to explain the variance in the
constructs, and the composite reliability coefcients
suggested that a high internal reliability existed in the
constructs. The statistical results indicated that the
measurement model has high reliability and validity,
and the retained items were able to measure the
constructs under study.
5.2. Structural model
The causal structure of the proposed research model
was tested using structural equation modeling (SEM).
The authors used the modeling generating (MG) strategy for altering the structural equation model suggested by Joreskog [36]. When employing this, a
researcher modies the model based on the results
of the data analysis. The model is modied until it is
both theoretically meaningful and statistically well
tting.
The test demonstrated reasonable t between the
data and the proposed structural model. The chisquare was calculated to be 497.2 (P 0:00) with
158 d.f. The CFI provides evidence of a reasonably
tting model (CFI 0:87). However, the root mean

L.-d. Chen et al. / Information & Management 39 (2002) 705719

713

Table 6
LAMBDA-X (factor loadings)
Item

Measure

Factor loading

C2
C3

Using (name of the virtual store) fits my lifestyle

Using (name of the virtual store) fits well with the way I like to shop or seek product information

0.80
0.80

PU2

0.75

PU5
PU6

Using (name of the virtual store) would improve my performance in shopping or information seeking
(e.g. save time or money)
Using (name of the virtual store) would increase my productivity in shopping or information seeking
(e.g. make purchase decisions or find product information within the shortest time frame)
Using (name of the virtual store) would enhance my effectiveness in shopping or information seeking
(e.g. get the best deal or find the most information about a product)
Using (name of the virtual store) would make it easier for me to shop or find information
I find (name of the virtual store) very useful in my shopping or information seeking

0.74
0.75

PEOU3
PEOU4
PEOU5
PEOU6

My interaction with (name of the virtual store) is clear and understandable

I find (name of the virtual store) to be flexible to interact with
It is easy for me to become skillful at using (name of the virtual store)
I find (name of the virtual store) easy to use

0.81
0.76
0.67
0.74

A1
A2
A3
A4

Using (name
Using (name
The fact that
Using (name

0.68
0.74
0.56
0.60

BI1

I intend to use (name of the virtual store) (e.g. purchase a product or seek product information)

1.00

USE1
USE2

How often do you use (name of the virtual store) (for purchase or information seeking)?
How many times have you used (name of the virtual store) (for purchase or information seeking) in the
last 6 months?

0.95
0.80

PU3
PU4

of the virtual store) is convenient

of the virtual store) saves me time
I cannot see the actual products makes me think twice about using (name of the virtual store)
of the virtual store) is not secured (insecurity of financial transactions)

square error of approximation (RMSEA) was a little

above the recommended range of acceptability
(<0.050.08) suggested by MacCallum et al. [41],
and root mean square residual (RMR) was considerably greater than the recommended range of acceptability (<0.05) [13]. A review of the modication
indices revealed some evidence of mist in the model
(see Table 7). Note that the maximum modication
index is associated with GA (1, 2) (the regression
coefcient linking compatibility and PU), which
represents a path owing from compatibility (C) to
PU. This suggests that there existed a possible inuence from C to PU. A similar nding was determined
Table 7
Modication indices for gamma (GA)
PEOU
PU
A
BI
USE

C
34.74

1.64
0.89

0.80
1.98

0.69
0.63

in Moore and Benbasat's work. They found that

compatibility and relative advantage correlate highly
with each other, which was indicative of a causal
relationship between them. From a substantive perspective, it is reasonable that if consumers perceive
that using a virtual store is compatible with their
existing values, past experiences, and needs, they will
perceive it as useful. Due to this, the model was reestimated with GA (1, 2).
The estimation of the revised model yields a chisquare of 343.7 (P 0:00) with 155 d.f. Selected
goodness-of-t statistics are presented in Table 8.
The revised model demonstrated good t to the data.
The CFI 0:93, which is above the benchmark of
0.90. Both RMSEA and RMR are within the recommended range of acceptability. The modication
indices suggest that there is no outstanding value
suggesting model mist. Thus, no additional parameters need to be included in the structural model.
In order to determine the validity of the hypothesized paths, the statistical signicance of all structural
parameter estimates were examined. The structural

714

L.-d. Chen et al. / Information & Management 39 (2002) 705719

Table 8
Fit indices for the structural model for the revised model
Root mean square
error of approximation

Root mean
square residual

Normed fit
index

Non-normed
fit index

Comparative
fit index

0.069

0.048

0.87

0.93

0.93

Table 9
Hypothesis-testing results
Hypotheses
Hypothesis
Hypothesis
Hypothesis
Hypothesis
Hypothesis
Hypothesis
Hypothesis

Effects
1
2
3
4
5
6
7

Behavior intention to use

Attitude toward usingb
Perceived usefulnessb
Perceived usefulnessc
Perceived ease of usec
Compatibilityc
Perceived ease of used

Structural coefficient

S.E.

Remarks

0.99
0.64
0.16
0.30
0.32
0.40
0.28

0.07
0.10
0.10
0.09
0.07
0.08
0.08

Supported
Supported
Not supported
Supported
Supported
Supported
Supported

Effect on actual use of virtual store.

Effect on behavior intention to use.
c
Effect on attitude toward using.
d
Effect on perceived usefulness.
b

parameter estimates and the hypothesis-testing results

are shown in Table 9.
Hypotheses 1 and 2 are strongly supported. Hypothesis 3, however, is not supported. This implies that
higher PU of a virtual store does not lead to higher
consumer BI to use the virtual store. Hypotheses 46

are all strongly supported. Hypothesis 7 is supported.

A schematic representation of the revised structural
model for the model that includes the standardized
path coefcients is displayed in Fig. 2: the revised
model included one new link from compatibility (C) to
PU. The new structural path is considered to be

Fig. 2. The revised model (coefcients associated with structural paths represent standardized estimates; parenthesized values represent
standard errors; a: not signicant).

L.-d. Chen et al. / Information & Management 39 (2002) 705719

justiable, both substantively and statistically. The

inclusion of the path resulted in a revised research
model that ts the data well (CFI 0:93).
6. Implications and conclusion
Our work generated the following insights in understanding consumer acceptance of virtual stores.
1. The classic theories on technology acceptance and
innovation diffusion/adoption are still valid in
explaining and predicting user behaviors in the
business-to-consumer EC context.
2. Consumer acceptance and use of virtual stores can
be predicted reasonably well from their intention,
which is determined by their attitude towards
using virtual stores.
3. Compatibility, PU, and PEOU are the primary
determinants of consumer attitude towards using
virtual stores.
4. Both compatibility and PEOU inuence PU of
virtual stores.
The research model is derived from TAM and IDT,
which are among the most inuential theories in
predicting and explaining system use and innovation
diffusion, respectively. The validation and the revision
of the model were crucial to our study. Assessing the
validity of existing theories in a new domain is an
important task. In our study, the successful validation
of the model attests that these theories are wellfounded. Moreover, the revision of the model helps
augment the research model to explain and predict
consumer acceptance of virtual stores.
Our ndings have some important implications to
managers and developers of virtual stores. Organizations can apply the framework to predict consumers'
willingness to accept and use their stores, diagnose
the reasons for low acceptance for existing stores,
and develop corrective steps. The central point is
consumer attitude towards using virtual stores. If
consumers have more positive attitude, they are more
likely to accept and use virtual stores. The framework also provides insights on how to achieve this: a
more positive consumer attitude can be achieved by
enhancing a virtual store's compatibility with the
consumer's value, needs and lifestyle, PU, and
PEOU.

715

How can virtual stores make online shopping more

compatible with consumers' lifestyle and needs? They
can start by trying to understand online consumers. A
``wired lifestyle'' and time starvation are two factors
that inuence a person to shop online. The rst is
characterized by a history of using the Internet, adequate access to the Internet and an appreciation of the
Internet's potential to improve personal productivity.
Traditionally, online consumers are more likely to be
well educated with higher household incomes. They
include most of the early adopters of online shopping.
However, in order for online shopping to reach its
desired level of popularity, virtual stores must strive to
attract those late adopters and laggards. This can only
be achieved when there is wide availability of the
technological infrastructure, proper education of the
potential user, and lower access cost. Recently, KMart, the US national discount retailer, whose target
markets include middle to low income consumers,
strategically allied with America online (AOL) to offer
free Internet service, bluelight.com, to its customers
[45]. This represents K-Mart's attempt to compete in
the low-end B2C market. Virtual stores also need to
educate consumers about the benets and risks in
online shopping. Privacy and security concerns continue to be a major impediments. Only when consumers are knowledgeable about protecting themselves
when engaging in online transactions will they willingly adapt to online shopping.
Can virtual stores provide consumers with the same
level of entertainment as traditional retailing channels? As a competing retailing channel against ``brickand-mortar'' stores, virtual stores offer some obvious
advantages: convenience, a broader selection, competitive prices, and greater access to information. Nevertheless, in-home shopping is rated from medium to
low in terms of entertainment and social interaction.
Although in recent years a number of virtual stores
have tremendously enhanced their storefront to provide more lively interaction through animation, virtual
reality, online chatting, etc. the level of playfulness of
virtual stores is still relatively low. As a result, consumers use virtual stores extensively in the information search phase of the buyer decision-making
process and make the actual purchases in conventional
stores. Hence, while virtual stores tap the needs of
time-starving consumers, they seem to be less attractive to leisure consumers, who value social interaction

716

L.-d. Chen et al. / Information & Management 39 (2002) 705719

and rst hand experience with products, etc. Previous

computer adoption studies have found that if users are
more playful with computer systems, they are more
motivated to use the systems [65]. Hence, enhancing
the playfulness of using a virtual store should be given
a high priority.
Virtual store managers and developers can predict
potential acceptance and form strategies by examining
the antecedents of PU and PEOU. Previous TAM
studies have found consistently that PU is a function
of system characteristics, for instance, high quality
results. As both product and information providers, the
usefulness of a virtual store lies in its ability to supply
consumers with high quality products and rich information. Product perceptions are the primary determinant of shopping at a particular retailer. Attributes of
products including product variety, price, and productretailing channel t are all inuential factors in retail
store patronage. The protable e-business community
(EBC) will create alliances between virtual stores and
suppliers to develop diversied product lists with
competitive prices, alliances between virtual stores
to increase product variety, product availability, and
cross-selling opportunities, and alliances between virtual stores and customers to provoke constant dialog,
so that virtual stores can detect and react to market
trends in a timely manner.
Consumers make inferences about the product or
services based on the information provided by retailers. The quality and usefulness of the information is
determined by the degree to which consumers can use
the information to predict their satisfaction with the
product prior to the actual purchase: consumers'
choice of virtual stores will heavily depend on its
ability to provide rich information.
Virtual stores may be able to enhance their PEOU by
providing training; for example, a virtual tour of the
storefront that aims at raising consumers' computer
self-efcacy. To increase the objective usability of the
storefront, developers of virtual stores need to conduct
extensive usability tests. While the classic user interface
design principles are valid, the new media has offered
developers new challenges. Virtual stores with easy
navigation and convenient checkout have been consistently found to increase sales and customer loyalty.
Based on TAM and IDT, this study proposed a
general model to predict and explain consumer acceptance of virtual stores. Empirically tested among 253

online consumers, the model was found to be both

reliable and valid. It not only provided new theoretical
grounds for studying business-to-consumer EC, but
has great practical implications as well.
Acknowledgements
We would like to acknowledge the editor, Professor
Edgar Sibley, and the anonymous reviewers whose
constructive comments helped to improve the quality
of this paper signicantly.
Appendix A. List of items by construct
Compatibility (C)
C1:
using (name of the virtual store) is
compatible with most aspects of my shopping or seeking product information.

C2:
using (name of the virtual store) fits my
lifestyle.

C3:
using (name of the virtual store) fits well
with the way I like to shop or seek product
information.
Perceived usefulness (PU)
PU1:
using (name of the virtual store) would
enable me to accomplish shopping or
information seeking more quickly than
using traditional stores.

PU2:
using (name of the virtual store) would
improve my performance in shopping or
information seeking (e.g. save time or
money).

PU3:
using (name of the virtual store) would
increase my productivity in shopping or
information seeking (e.g. make purchase
decisions or find product information within the shortest time frame).

PU4:
using (name of the virtual store) would
enhance my effectiveness in shopping or
information seeking (e.g. get the best deal
or find the most information about a
product).

PU5:
using (name of the virtual store) would
make it easier for me to shop or find
information.

L.-d. Chen et al. / Information & Management 39 (2002) 705719

PU6:

I find (name of the virtual store) very

useful in my shopping or information
seeking.

Perceived ease of use (PEOU)

PEOU1: learning to use (name of the virtual store)
is easy for me.
PEOU2: I find it easy to use (name of the virtual
store) to find what I want.
PEOU3: my interaction with (name of the virtual
store) is clear and understandable.
PEOU4: I find (name of the virtual store) to be
flexible to interact with.
PEOU5: it is easy for me to become skilful at
using (name of the virtual store).
PEOU6: I find (name of the virtual store) easy to
use.
Attitude (A)

A1:
using (name of the virtual store) is
convenient.

A2:
using (name of the virtual store) saves me
time.

A3:
the fact that I cannot see the actual
products makes me think twice about using
(name of the virtual store).

A4:
using (name of the virtual store) is not
secured (insecurity of financial transactions).
A5:
using (name of the virtual store) puts my
privacy at risk.
A6:
using (name of the virtual store) makes me
lose social contact (can be a positive belief
or a negative belief).
A7:
using (name of the virtual store) saves me
money.
A8:
the (name of the virtual store) has a larger
product selection than traditional stores.
Behavioral intention (BI)

BI1:
I intend to use (name of the virtual store)
(e.g. purchase a product or seek product
information).
Actual use (USE)
USE1: how often do you use (name of the virtual
store) (for purchase or information seeking)?

USE2:

717

how many times have you used (name of

the virtual store) (for purchase or information seeking) in the last 6 months?

The symbol () means that item is retained for data

analysis.
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Lei-da Chen is Assistant Professor of
Information Systems and Technology in
the College of Business Administration
of Creighton University. His research
interests include electronic commerce,
Web-based systems development, data
warehousing and mining, and diffusion
of information technology in organizations. He received his PhD in Management Information Systems from the
University of Memphis. Dr Chen has
published over 20 professional articles in refereed journals and
national and international conference proceedings. His research has

719

appeared in Information & Management, Communications of AIS,

Journal of Management Systems, Information Systems Management, Journal of Computer Information Systems, Electronic
Markets, and Journal of Education for MIS.
Mark L. Gillenson is Professor of
Management Information Systems in
the Fogelman College of Business and
Economics of the University of Memphis in Memphis, TN. He received his
BS degree in Mathematics from Rensselaer Polytechnic Institute and his MS
and PhD degrees in Computer and
Information Science from The Ohio
State University. Dr Gillenson worked
for the IBM Corp. for 15 years in a
variety of positions, including seven
years as a faculty member of the prestigious IBM Systems
Research Institute. Subsequently, he was a Professor at the
University of Miami, Miami, FL. Dr Gillenson's areas of interest
are electronic commerce, database administration and database
design. He is an associate editor of the Journal of Database
Management and Journal Pattern Recognition. Dr Gillenson's
research has appeared in MIS Quarterly, Communications of the
ACM, Methods of Information in Medicine, and other leading
journals. His books include Strategic Planning, Systems Analysis,
and Database Design, 1984, and Database: Step-by-Step, Second
Edition, 1990, both published by Wiley.
Daniel L. Sherrell is Associate Dean for
Faculty and Research and Professor of
Marketing at the University of Memphis.
Dr Sherrell joined the University of
Memphis faculty in 1995. Prior to that
he spent 15 years on the marketing
faculty at Louisiana State University. He
received his PhD from the University of
South Carolina in 1980. He has served as
Secretary and Vice-President for Membership for the Southern Marketing
Association, as well as Program Chair and President of the
Southwestern Marketing Association. In addition, he has served as
an Associate Editor for the Journal of Academy of Marketing
Science, and as a reviewer for the Journal of Business Research. Dr
Sherrell has published over 40 articles in refereed journals and
national conference proceedings. His research has appeared in the
Journal of Consumer Research, Psychology & Marketing, Journal
of Academy of Marketing Science, Industrial Marketing Management, Journal of Business Research, and Journal of Personal
Selling and Sales Management. His current research interests
center around the impact of information technology on the practice
of marketing strategy; customer satisfaction formation in electronic
commerce environments; quality judgments for services; and
consumer price/value judgments. As a consultant, Dr Sherrell has
worked with a variety of firms in the areas of customer satisfaction
and quality benchmarking, as well as strategic marketing.