Journal of Business Ethics (2010) 95:373–391
DOI 10.1007/s10551-010-0365-9
Relational Consequences of Perceived
Deception in Online Shopping:
The Moderating Roles of Type of Product,
Consumer’s Attitude Toward the Internet
and Consumer’s Demographics
ABSTRACT. This study investigates the negative influ-
ence of consumer’s perceptions of online retailer’s
deceptive practices (perceived deception) on consumer’s
relational variables (satisfaction and loyalty intentions to
the online retailer). Also, the moderating role of product
type (goods versus services), consumer’s attitude toward
the Internet, and consumer’s demographics in the
deception-relational outcomes link is considered. Data
from 398 online consumers revealed that satisfaction
totally mediated the influence of deception on loyalty.
Furthermore, the deception-satisfaction link was moder-
ated by all the hypothesized variables. Interestingly, a
direct effect of deception on loyalty was found among
more educated consumers, consumers who had a more
positive attitude toward the Internet and consumers who
had purchased a physical product. Implications for theory
and management are discussed.
KEY WORDS: perceived online deception, consumer
satisfaction, loyalty intentions, type of products, moder-
ating effects
Introduction
Consider the following examples: An online services
provider makes ‘‘free trial’’ offers to consumers, yet it
does not make it clear that consumers have an affir-
mative obligation to cancel the service before the trial
period ends (the key information is available, but
buried in the fine print). As a result, consumers who
failed to cancel were enrolled automatically and began
incurring monthly charges. Another website shows
 Springer 2010
Sergio Román
misleading information about what is included in the
final offer using various media. While displaying an
attractive image of a computer with a monitor, the
website states in very small text that the monitor is sold
separately. These are both examples of real consumer
complaints drawn from two major consumer review
websites (epinions.com and bizrate.com).
The commercial use of the Internet is still
increasing, and online shopping more and more
becomes a part of our day-to-day life (Van Noort
et al., 2008). Unfortunately, fraudulent practices,
misleading advertisements, and misrepresentations
of information on the Internet also continue to
increase. The rapid rise in the number of consumer
complaints related to online fraud and deception
bears this out: in 1997, the National Fraud Infor-
mation Center (www.fraud.org) received fewer than
1000 Internet fraud complaints. In 2005, it received
over 12,000 complaints. Furthermore, the average
loss in 2005 was $1917, much higher than the
average loss in 2004 ($895).
Many deceptive practices in e-commerce settings
(e.g., the exaggeration of product benefits and
characteristics) are variations of well-known decep-
tion types already used in the traditional shopping
context. However, the opportunity to perpetrate an
online deception is increased by several reasons.
First, the Internet is inherently a representational
environment, i.e., an environment in which con-
sumers make decisions about products based on
cognitive representations of reality. The relatively
unfamiliar and impersonal nature of the Web, as well
374 Sergio Román
as the lack of opportunities for face-to-face interac-
tions reduces people’s ability to detect deception
(Ben-Ner and Putterman, 2003). For instance, in
traditional retail settings, the detection of deception
relies, among other things, on recognizing subtle
changes in a person’s nonverbal behaviors, such as
eye contact and body movements (DePaulo, 1992).
Second, compared to the brick and mortar world,
the Internet lowers the entry and set up costs for
new sellers (Biswas and Biswas, 2004), making it
relatively easy for a deceptive online retailer to set up
a storefront on the Internet that is as genuine-
looking as its legitimate counterpart. For example,
the Internet can be used effectively by a small
company to appear deceptively large, as the webpage
on the computer screen does not distinguish
between a large and a small company (Petty, 1998).
Third, the Internet makes the identity of the parties
involved in communications and transaction difficult
to verify. In particular, the Internet allows firms from
different legal and regulatory environments to pres-
ent their offerings without a strong international
legal and consumer protection system (Morris-
Cotterill, 1999).
Research in traditional settings shows that
deceptive company policies impact consumers’ atti-
tudes and behaviors in the marketplace (e.g., Ingram
et al., 2005; Jehn and Scott, 2008; Ramsey et al.,
2007). However, relatively little attention has
explicitly been given to consumers’ reactions to
deceptive practices of online retailers (Biswas and
Biswas, 2004; Palmer, 2005; Román, 2007). In the
light of these issues, this research has two main
objectives: (1) to analyze the direct and indirect
influence of consumer’s perceptions of online re-
tailer’s deceptive practices (perceived deception) on
consumer’s satisfaction and loyalty intentions to the
online retailer1 and (2) to analyze to what extent the
hypothesized direct influence of perceived deception
on satisfaction and loyalty intentions is moderated by
the type of product being purchased (goods versus
services), consumer’s attitude toward the Internet,
and consumer’s demographics (age, education, and
gender). This research does not intend to examine all
potential moderating variables, rather it represents an
initial step in the process of understanding the
moderating influence of the type of product, con-
sumer’s attitude toward the Internet and demo-
graphics. These variables were chosen because prior
research has shown that they play a key role
in explaining consumers’ online purchasing behav-
ior (e.g., Hansen, 2005; Jayawardhena, 2004;
Korgaonkar et al., 2006; Sexton et al., 2002).
The remainder of the article consists of the fol-
lowing sections. First, we provide a brief synthesis of
the existing literature on deception in marketing,
with an emphasis on those studies focused on online
retailing. Then, the main constructs of the study
(online deception, consumer satisfaction, and loyalty
intentions) are defined, leading to the development
of hypotheses. Third, the methodology of the study
is described. Finally, the study results, managerial
implications, limitations, and future research oppor-
tunities are discussed.
Literature review
Deception is a general phenomenon that can occur
in virtually any form of communication under
conflict of interest (Johnson et al., 2001). Deception
comes in a wide array of forms other than the out-
right lie, and among the features that differentiate
them are amount and sufficiency of information,
degree of truthfulness, clarity, relevance, and intent.
Whatever the type of deception, it causes a number
of ethical questions and issues for companies, con-
sumers, and policy makers. Within business disci-
plines, deception has been extensively studied by
organizational (e.g., Fleming and Zyglidopoulos,
2008; Jehn and Scott, 2008), accounting (e.g.,
Gibbins, 1992; Zimbelman, 1997), and information
systems researchers (e.g., Biros et al., 2002).
In the marketing field, deception has received
special attention in the areas of advertising and
personal selling/traditional retailing. Deception in
the context of marketing practices is ‘‘unethical and
unfair to the deceived’’ (Aditya, 2001, p. 737). Prior
research on deceptive advertising has focused largely
on identifying the specific types of claims that lead
consumers to make erroneous judgments and its
consequences on consumers’ beliefs, affect, and
behavioral intentions (e.g., Burke et al., 1988; Darke
and Ritchie, 2007). For instance, recent findings
from Darke and Ritchie (2007) showed that
deceptive advertising engenders consumers’ distrust.
Earlier research in retailing and personal selling
has identified ‘‘the exaggeration of the features and
 Relational Consequences of Perceived Deception in Online Shopping
benefits of a product’’ and ‘‘selling items through
high-pressure selling techniques’’ as common
examples of deceptive or manipulative tactics
(Ingram et al., 2005; Ramsey et al., 2007; Román and
Ruiz, 2005). Results from this stream of research
parallels those obtained by advertising researchers in
that deceptive selling actions have been found to
decrease customer satisfaction and trust.
Only recently researchers have paid attention to
the topic of deception in online retailing. In what
follows, we summarize the results of the empirical
studies that have addressed, to some extent, these
issues. Grazioli and Jarvenpaa (2000) conducted a
laboratory experiment with 80 MBA students. Half
of the subjects accessed a real commercial site, and
the other half accessed a copy of the site forged by
the researchers. The forged site contained several
malicious manipulations (e.g., false quotes from
professional magazines were created, the site size and
sales were grossly exaggerated), designed to increase
trust, and ultimately increase the likelihood that
visitors would buy from it. Their results revealed
that deceptive manipulations can alter the decision-
making processes of individuals, and suggested that
even sophisticated, technologically competent indi-
viduals fail to detect the fraud manipulations. Later,
Miyazaki and Fernandez (2001) evaluated consum-
ers’ concerns regarding online shopping. Four major
concerns emerged from a sample of 189 consum-
ers. One of them was online retailer fraud, which
referred to consumers’ concerns regarding fraudulent
behavior by the online retailer, such as purposeful
misrepresentation or non-delivery of goods. Also,
some effort has been devoted to examine consumers’
perceptions and reactions to online retailers’ safety
cues (e.g., privacy policies, security disclosures, and
warranties). These experiments, mostly conducted
with students, tend to show that online safety cues
(1) lower consumers’ risk perceptions (Van Noort
et al., 2008) and (2) are stronger relievers of per-
ceived risks in online than in offline contexts (Biswas
and Biswas, 2004).
Interestingly, Grazioli and Jarvenpaa (2003) con-
ducted a content analysis of 201 cases of Internet
deception, which revealed that deceivers selected
deceptive tactics based on the characteristics of their
targets as well as their own purported identities.
Among the four types of e-commerce deception
375
(i.e., B2C, B2B, C2B, and C2C), those by online
businesses against consumers was found to be the
most frequent. Román (2007) developed a scale to
measure consumers’ perceptions regarding the ethics
of online retailers (CPEOR). His findings indicated
that the CPEOR scale had four dimensions: security,
privacy, non-deception, and fulfillment/reliability.
The CPEOR scale was implemented initially with
two separate convenience samples of online con-
sumers. The scale demonstrated good psychometric
properties based on findings from a variety of reli-
ability and validity tests. Recently, Mitra et al. (2008)
analyzed how consumer’s beliefs are shaped by
online advertising (truthful versus misleading) claims
and affected by media richness. Their lab study,
conducted with students, showed that the deception
potential is greater when consumer’s involvement
is low.
Figure 1 represents our conceptual model. The
present study contributes to theory and management
in the following ways. First, we extend previous
studies in the context of online deception by ana-
lyzing the direct effects of perceived online decep-
tion on consumer’s satisfaction and loyalty intentions
to the online retailer. In doing so, we examine to
which extent the effect of deception on loyalty is
mediated by satisfaction. Several studies conducted
in traditional retail settings have recently called for a
comprehensive analysis of the relationships between
deception and its consequences because these rela-
tionships may not always be simple and direct
(Ingram et al., 2005; Román and Ruiz, 2005). A
thorough investigation of the complex interrela-
tionships will prove beneficial for a more complete
understanding of the mechanisms that lead from
deception to desfavorable relational outcomes.
Researchers have also called for the study of the
relationship between satisfaction and loyalty in the
online context (e.g., Anderson and Srinivasan, 2003;
Shankar et al., 2003). For instance, Anderson and
Srinivasan (2003, p. 134) pointed out that: ‘‘learning
more about the critical relationship between e-sat-
isfaction and e-loyalty should be a top priority for
scholars and practitioners.’’ In the offline context,
extant research has found that satisfaction leads to
loyalty (e.g., Bolton and Lemon, 1999). Yet, in the
online context (where many alternatives are only a
mouse click away), it is possible for a customer to be
376 Sergio Román

Moderating variables

Product type (goods vs. services) (H4a, H4b)

Consumer’s attitude toward Internet (H5a, H5b)

Consumer’s age (H6a, H7a), education (H6b, H7b) and gender (H6c, H7c)

Consumer
satisfaction

*
=-.39*
H1(-) γ
Perceived
deception H3(+) β=.81**
H2(-) γ
=-. 01 (ns)

Consumer
loyalty
intentions
χ2(32)=83.34 p<.01; GFI=.96; AGFI=.93 CFI=.99; RMSEA=.04; RMSR=.04; TLI (NNFI)=.99

Figure 1. The research model and results of direct effects (standardized coefficients). **p < 0.01, ns Not significant.

highly satisfied and yet not be loyal. Therefore, the
study of the relationship between satisfaction and
loyalty should provide a managerial contribution in
that online retailers could more precisely allocate
their online marketing efforts between satisfaction
initiatives and loyalty programs.
Finally, none of the previous studies has incor-
porated the analysis of moderating variables on the
consequences of online deception on consumer’s
relational variables. Yet, researchers have repeatedly
pointed out that it is important to investigate mod-
erating effects in consumer studies (e.g., Dabholkar
and Bagozzi, 2002). Figure 1 proposes a more gen-
eral, encompassing theoretical model: the direct
effects are moderated by the type of product being
purchased, the consumer’s attitude toward the
Internet and consumer’s demographics. Importantly,
evidence from studies carried out in traditional set-
tings tend to indicate that consumers’ perceptions of
the severity of unethical/deceptive company prac-
tices increase with age, education and tend to be
higher for females than for males (e.g., McIntyre
et al., 1999; Ramsey et al., 2007; Weeks et al.,
1999). The analysis of the moderating effects in the
online context will provide online retailers a better
understanding of the potential reactions of key
segments of consumers toward the firm’s (deceptive)
actions. This, in turn, may facilitate their relation-
ship-building efforts toward various demographic
groups (e.g., by explicitly addressing the ethical
concerns of those target groups who perceive higher
severity of deceptive retail actions).
Hypotheses development
In what follows, the focal constructs of the study are
defined (perceived online deception, satisfaction,
and loyalty intentions). Then, the framework and
the hypotheses to be tested are developed. Internet
deception practices can have several manifestations:
making false claims about product characteristics,
failing to meet warranty obligations, selling defective
goods or services without adequate disclosures,
fraudulently acquiring sensitive information, such as
usernames, passwords, and credit card details,2 etc.
This study particularly focuses on consumer’s per-
ceptions of product-related online deception.3 We
are drawing from early studies in advertising
deception (Carson et al., 1985; Gardner, 1975;
Hyman, 1990), as well as recent work on Internet
deception (Grazioli and Jarvenpaa, 2003; Román,
 Relational Consequences of Perceived Deception in Online Shopping
2007) to conceptualize our main variable. Perceived
online deception practices cause consumers to have
false beliefs about the nature of the products being
offered, and thereby their purchasing decisions may
differ from those that they would have had other-
wise. In other words, perceived deception in this
study represents an unethical act perpetrated by
online companies to manipulate product informa-
tion content and/or presentation so as to induce
desired behavioral changes in consumer decision
making – changes that may be to the detriment of
the consumers (e.g., purchasing an item based on
misleading representations of their characteristics
made by the online retailer). For example, the online
retailer can manipulate the information content by
withholding, equivocating, or falsifying the content
of information presented to consumers in the web-
site. Also, the online retailer can manipulate the
information presentation by: (1) altering individual
features (e.g., size, color, and interactivity) to either
inhibit correct product understanding or foster
incorrect product understanding and/or (2) manip-
ulating the level of presentation vividness so as to
focus consumers’ attention on irrelevant information
or distract their attention from relevant information
(Grazioli and Jarvenpaa, 2003).
Importantly, Internet fraud is a narrower term that
denotes a violation of the law, whereas not all per-
ceived deceptive practices, as defined in this study,
constitute fraud.4 For example, as shown in one of
the introductory vignettes, an online retailer dis-
played an attractive image of a computer and mon-
itor together. Only in very small text was it stated
that the computer and monitor were sold separately.
Though this practice does not constitute a violation
of the law, consumers perceived it as deceptive.
As for the dependent variables, satisfaction with
the online retailer is conceptualized as: ‘‘the con-
tentment of the customer with respect to his or her
prior purchasing experience with a given electronic
commerce firm’’ (Anderson and Srinivasan, 2003,
p. 125). Loyalty intentions are defined as a combi-
nation of consumer’s intention to buy from the
website in the future, and to recommend it to other
consumers. This covers the two aspects of loyalty
suggested most often in extant research: the inten-
tion of repurchase and the commitment echoing in
the intention to spread positive word-of-mouth
(e.g., Cronin et al., 2000; Wolfinbarger and Gilly,
377
2003). Furthermore, taking an intentions perspective
of loyalty rather than considering actual repurchase
behavior may avoid confusing spuriously loyals, who
only repurchase because of a lack of alternatives,
with genuinely loyal customers (Bell et al., 2005;
Fassnacht and Köse, 2007).
Direct and indirect effects
We build on the expectancy disconfirmation para-
digm (e.g., Oliver and DeSarbo, 1988) to propose
the influence of deception on satisfaction. This
theory holds that consumers make a comparison
between product expectations and performance that
will result in either confirmation or disconfirmation.
Customers’ expectations are confirmed when prod-
uct performance exactly meets expectations. Dis-
confirmation will be the result of a discrepancy
between expectations and performance. Positive
disconfirmation occurs when product performance
exceeds prior expectations, and negative disconfir-
mation occurs when expectations exceed perfor-
mance. Confirmation and positive disconfirmation
will be likely to result in satisfaction, whereas neg-
ative disconfirmation leads to dissatisfaction.
Consumers’ expectations regarding the product
(either a physical product or a service) are highly
dependent on the information displayed at the site
(Coupey, 2001). As discussed earlier, an online re-
tailer that implements deceptive techniques is more
likely to provide unrealistic expectations about the
product (among other things). This may result in
negative disconfirmation between expectations and
product performance, thus leading to customer dis-
satisfaction with the website. Earlier research in off-
line settings provides empirical evidence for the
negative effect of deceptive/manipulative selling
tactics on consumer satisfaction (e.g., Román and
Ruiz, 2005). All the above leads us to propose that:
Hypothesis 1: Perceived deception will have a neg-
ative influence on consumer’s satisfaction with
the online retailer.
The relationship between online deception and
loyalty intentions can be explained using equity
theory (Adams, 1963). Equity theory involves the
norm of distributive justice in a dyadic relationship
(i.e., the desire on the part of the members involved
378 Sergio Román
to have a fair and just distribution of profit). Re-
search indicates that consumers often evaluate mar-
ketplace transactions by considering how equitable
each party has contributed to the exchange (Hup-
pertz et al., 1978). In particular, equity theory argues
that if one party (consumer) perceives another party
benefiting unfairly (i.e., the online retailer sells the
product as a result of implementing deceptive
practices), the disadvantaged party views the situa-
tion as inequitable and attempts to regain balance or
restore equilibrium. In such a case, actions may
consist of negative word-of-mouth to friends and
family, complaints to the company or third party
organizations, or no future purchases from the on-
line retailer (Ingram et al., 2005). Prior research in
traditional retail settings has linked consumers’ per-
ceptions of deceptive practices (e.g., high-pressure
selling techniques) to loyalty (e.g., Whalen et al.,
1991). Accordingly, the following hypothesis is
formulated:
Hypothesis 2: Perceived deception will have a neg-
ative influence on consumer’s loyalty intentions
to the online retailer.
The positive influence of satisfaction on loyalty has
been well documented in the traditional retail context
(e.g., Bolton and Lemon, 1999; Ingram et al., 2005).
Only recently this relationship has also been tested in
the online environment (e.g., Fassnacht and Köse,
2007). This relationship can be explained by the fact
that satisfied customers highly value the product
offered by the company. For this reason, they will be
more inclined to buy from the company in the future
and behave in a way that is beneficial to the company
(spreading positive word-of-mouth). Accordingly,
we expect that satisfaction with the online retailer
increases loyalty intentions. Stated formally:
Hypothesis 3: Consumer’s satisfaction with the on-
line retailer will have a positive influence on
loyalty intentions.
It is important to note that we predict the link to
be positive between satisfaction and loyalty as per the
marketing literature. We also predict the links to be
negative between deception and satisfaction and
loyalty intentions as per our previously stated theo-
rizing. Yet, as discussed at the beginning of the
article, we will also investigate the extent to which
deception has an indirect effect on loyalty through
satisfaction.
Moderating effects
In addition to testing for the aforementioned effects,
this article also takes an initial step toward assessing
the role of the type of product being purchased
(goods versus services), consumer’s attitude toward
the Internet, and consumer’s demographics that may
moderate the effect of perceived deception on
consumer satisfaction and loyalty intentions.
The moderating effect of the type of product purchased
online
While shopping for service products presents a range
of challenges for consumers, most of service prob-
lems are reduced during online shopping experi-
ences (Pitt et al., 1999). Through the advanced
technology created by the World Wide Web, con-
sumers can now experience the sights and sounds
related to particular service products. Thus, the
traditional problem of intangibility is virtually
reduced in some types of services (Smith and
Sivakumar, 2004). In traditional retailing, the
problem of intangibility is especially relevant for
services high in experience attributes (e.g., travel
vacation packages). This implies that consumers are
generally unable to make a decision about the quality
of a service until they have purchased it. However,
online retailers can give consumers many tools that
can be used to evaluate the experience properties
associated with many service products. For example,
Disney.com ‘‘tangibilizes’’ the Disney dream vaca-
tion by allowing consumers to virtually experience
the Disney theme parks by meeting the characters,
viewing the rides, and hearing the music typically
associated with Disney (Pitt et al., 1999).
By contrast, Internet retailing, despite allowing
for some multimedia presentation, is inherently
deficient in offering pretrial experience and evalua-
tion for a majority of commonly bought items
(physical products), such as clothing, toys, and fur-
niture (Grewal et al., 2004). Consumers often require
high sensory evaluation and/or trial for products such
as clothing, but these can hardly be represented
 Relational Consequences of Perceived Deception in Online Shopping
digitally (Grewal et al. 2004). Accordingly, consumers
in the online context have difficulty in evaluating
some physical/tangible products that are easily evalu-
ated in the traditional context. Then, quality uncer-
tainty becomes a problem. In these cases, e-retailers
can easily exaggerate product characteristics such as
quality, performance, size, or even color. On the
contrary, because services are intangible in traditional
retail settings, consumers will place a great amount of
emphasis on browsing and information gathering
during on-line shopping experiences (Shankar et al.,
2003). In fact, information gathering online will
actually serve to reduce or alleviate the risks that are
typically associated with the purchase of services in
traditional retail settings (Frambach et al., 2007).
In short, online consumers are in a better position
to know what to expect from the service and are less
likely to be surprised or disappointed at the service
received (Shankar et al., 2003), than when they buy
a physical product online. This suggests more dis-
confirmation with expectations as a result of
deceptive practices when the product purchased
online is a physical product, instead of a service.
Also, the consumer may view the situation as more
inequitable or unfair if deceptive practices have been
implemented when buying a physical product as
opposed to a service. Based on this reasoning, it is
expected that the negative effect of perceived
deception on consumers’ satisfaction and loyalty
intentions will be stronger for physical products
(goods) than for services. Stated formally:
Hypothesis 4a: The negative influence of perceived
deception on satisfaction will be stronger when
the consumer has purchased a physical product
rather than when he/she has purchased a service.
Hypothesis 4b: The negative influence of perceived
deception on loyalty intentions will be stronger
when the consumer has purchased a physical
product rather than when he/she has purchased a
service.
The moderating effect of consumer’s attitude toward
the Internet
Building on Petty et al. (1991, p. 242), consumer’s
attitude toward the Internet is defined as consumer’s
global and relatively consistent evaluations, feelings,
379
and tendencies toward the Internet. Attitudes put
people into a frame of mind for liking or disliking
things, for moving toward or away from them. Prior
research suggests that consumers with a more posi-
tive attitude toward the Internet have more positive
beliefs about the trustworthiness of the Internet and
feel more comfortable using it (George, 2002). In
fact, researchers drawing on the technology accep-
tance model (TAM) have shown that consumer’s
attitudes toward the Internet are strongly and
positively correlated with user acceptance (e.g.,
Jayawardhena, 2004).
The above findings along with the expectancy
disconfirmation paradigm allow us to expect con-
sumer’s attitudes toward the Internet to have a
moderating effect on the influence of deception on
satisfaction and loyalty intentions. Consumers with a
more positive attitude toward the Internet are less
likely to expect deceptive/opportunistic practices
from online retailers than consumers with a less
positive attitude toward the Internet. In case such
practices take place, consumers with a more positive
attitude toward the Internet will evaluate them dif-
ferently than consumers with a less positive attitude.
More specifically, it is hypothesized that deceptive
practices are particularly harmful when unexpected
(unexpected because the consumer has a more
positive attitude toward the Internet), and conse-
quently they will have stronger negative effects on
satisfaction and loyalty than when they are expected
(expected because the consumer has a less positive
attitude toward the Internet). Stated formally:
Hypothesis 5a: The negative influence of perceived
deception on satisfaction will be stronger when
the consumer has a more positive attitude toward
the Internet than when he/she has a less positive
attitude toward the Internet.
Hypothesis 5b: The negative influence of perceived
deception on loyalty intentions will be stronger
when the consumer has a more positive attitude
toward the Internet than when he/she has a less
positive attitude toward the Internet.
The moderating effect of consumer’s demographics
Only recently research has empirically addressed the
moderating role of consumer’s demographics in the
380 Sergio Román
online environment. For example, Hansen (2005)
found that perceived order accessibility had a signif-
icant positive effect on future online buying intention
for well educated consumers, but not for less educated
consumers. Findings from Garbarino and Strahilevitz
(2004) suggested that positive word-of-mouth leads
to both greater reduction in perceived risk and
stronger increase in willingness to buy online among
women than men. Nevertheless, the moderating role
of demographics on the consequences of deception
has not been previously examined.
In the offline context, while the evidence linking
demographic groups with unethical/deceptive activ-
ities is not conclusive, the weight appears to rest on
the side of describing demographic segments that
consistently vary in their general evaluations of
ethics, and thus, in the perceptions of the un/ethical
practices of firms. More specifically, prior research
(e.g., McIntyre et al., 1999; Ramsey et al., 2007)
suggests that consumers become more aware of the
severity of unethical practices as they obtain greater
maturity (age and education). In fact, education and
age are theorized to result in higher levels of moral
reasoning (Rest, 1986). For instance, results from
Ramsey et al. (2007) showed that older consumers,
as compared to younger ones, evaluated unethical
practices using higher standards5 than those used by
younger subjects.
Additional evidence exists for greater ethical
awareness and sensitivity by females (e.g., Roxas and
Stoneback, 2004; Weeks et al., 1999). Weeks et al.
(1999) found that women adopted a more strict
ethical stance than males when assessing unethical
practices. This can be explained by the gender
socialization approach (Kohlberg, 1969). The main
idea is that males and females will respond differently
to the same set of unethical/deceptive practices.
Roxas and Stoneback (2004) argue that men seek
competitive success and are more likely to break
rules, whereas women are more likely to adhere to
rules, as they are concerned about doing tasks well
and having harmonious relationships.
In summary, based on the above arguments we
expect older, more educated and female consumers
to be more critical of deceptive practices and con-
sequently to have a stronger negative reaction in
terms of lower levels of satisfaction and loyalty
intentions to the online retailer. Accordingly, it is
hypothesized that:
Hypothesis 6a–c: The negative influence of perceived
deception on satisfaction will be stronger for (a)
older (b) more educated and (c) female consumers
than for younger, less educated and male con-
sumers.
Hypothesis 7a–c: The negative influence of perceived
deception on loyalty intentions will be stronger
for (a) older (b) more educated and (c) female
consumers than for younger, less educated and
male consumers.
Method
Sample and data collection
A survey instrument was administered to a sample
of 398 real consumers. A marketing research firm
was hired to assist with the data collection.
Respondents were approached randomly among
individuals who passed the data collection point
located on the pedestrian walkway in a major
metropolitan city (for a similar procedure see
Frambach et al., 2007, pp. 30–31). Screening
questions were administered before the respondent
was invited for an interview. An invitation only
followed if the respondent proved to be eligible for
the study (that is, he/she should have purchased a
product online in the last 6 months). The latter
condition to facilitate consumers’ evaluations of the
online retailer’s website. Then, subjects were taken
to the company office (conveniently located in the
metropolitan area). The procedure was to let sub-
jects browse the website where they made their last
online shopping. After a certain period of time
(a maximum of 10 min), subjects were asked to
complete the questionnaire corresponding to that
site.
The respondents were representative of online
consumers across numerous e-retailers, having
purchased a variety of items (e.g., travel, books,
CDS, and computers). A profile of the sample is
shown in Table I. The respondents were relatively
young, generally highly educated and experienced
with the Internet. Prior research has found that
these characteristics are common among Internet
shoppers (Girard et al., 2003; Swinyard and Smith,
2003).
 Relational Consequences of Perceived Deception in Online Shopping 381

TABLE I perceptions of online retailer’s deceptive practices

Sample profile rather than on the act of deceiving itself (Román,
2007).
Variable Percentage Consumer attitude toward the Internet was
assessed using a three-item scale adapted from Porter
Gender and Donthu (2006) and Schiffman et al. (2003). This
Male 51 adaptation is consistent with previous studies
Female 49 examining consumers’ attitudes toward the tradi-
Age
tional retail context (e.g., Shim and Eastlick, 1998).
<20 10.5
Three items from Anderson and Srinivasan (2003)
20–35 65.2
36–50 18.1 were used to measure satisfaction. Due to the evi-
>50 6.3 dence that satisfaction is primarily an affectively
Education oriented construct (cf. Oliver, 1980), all items were
Low (primary school) 3.5 emotional in content and included references to the
Middle (high school) 28.3 respondent’s general feelings of outright satisfaction
High (University; polytechnic)a 68.2 and happiness about the purchase decision. Con-
Occupation sumers’ loyalty intentions were measured using a
Employed people 52.4 three-item6 scale adapted from Wolfinbarger and
Self-employed workers 14.3 Gilly (2003) and Fassnacht and Köse (2007). As
Students 29.3 discussed earlier in this article, this scale measures the
Others (retired, homemaker, 4.4
two aspects of loyalty suggested most often in extant
and unemployed)
research: the intention of repurchase and the inten-
Internet experience (years)
<2 6.3 tion to spread positive word-of-mouth.
2–5 33.4
6–8 35.3
>8 25 Confirmatory factor analyses: reliability, convergent,
Online purchases in the last year (e) and discriminant validity
<120e 28.8
120e–599e 41.8 A confirmatory factor analysis (CFA) by means of
600e–1199e 15.3 LISREL 8.72 was conducted to assess measurement
>1200e 14.2 reliability, convergent, and discriminant validity.
a
These individuals had completed their university studies. The measurement model had a good fit (v2(59) =
103.31, p < 0.01, GFI = 0.96, AGFI = 0.94,
CFI = 0.99, RMSEA = 0.02, RMSR = 0.03, TLI
(NNFI) = 0.98). In addition, the observed normed
Measures v2 for this model was 1.75, which is smaller than 3
recommended by Fornell and Larcker (1981), indi-
Existing multi-item scales, adapted to suit the con- cating a good model fit when we consider the
text of the study, were used for the measurement of sample size.
the constructs (all items of the questionnaire are Reliability of the measures was confirmed with
reported in Table II). All scales consisted of 5-point composite reliability index higher than the recom-
Likert questions, ranging from ‘‘1 = strongly dis- mended level of 0.60 (Bagozzi and Yi, 1988) and
agree’’ to ‘‘5 = strongly agree.’’ Perceived deception average variance extracted was higher than the rec-
was measured with four items from Román (2007). ommended level of 0.50 (Hair et al., 1998) as shown
These items refer to the extent to which the con- in Table III. Following the procedures suggested by
sumer believes that the online retailer uses deceptive Fornell and Larcker (1981) and Bagozzi and Yi
or manipulative practices with the intent to persuade (1988), convergent validity was assessed by verifying
consumers to purchase the website’s offerings. the significance of the t values associated with the
Importantly, this scale focuses on consumer’s parameter estimates (Table II). All t values were
382 Sergio Román

TABLE II
Construct measurement summary: confirmatory factor analysis of multi-item measures

Item descriptiona SD loading (t-value)

Perceived deception
The site exaggerates the benefits and characteristics of its offerings 0.57 (10.34)
The site uses misleading tactics to convince consumers to buy its products 0.80 (16.30)
It is not entirely truthful about its offerings 0.82 (17.12)
This site attempts to persuade you to buy things that you do not need 0.72 (15.53)
Consumer satisfaction
I am satisfied with my decision to purchase from this site 0.57 (9.74)
My choice to purchase from this site was a wise one 0.89 (15.08)
I am happy I made my purchase at this website 0.95 (16.21)
Consumer loyalty intentions
I plan to do business with this website in the future 0.83 (12.91)
I would recommend the website to someone who seeks my advice 0.91 (16.43)
I will advise friends and relatives to at least give this website a trial 0.95 (17.17)
Consumer attitude toward the Internet
The Internet enables me to do things I would not be able to do otherwise 0.70 (12.03)
I am positive toward the Internet 0.82 (13.41)
I feel comfortable using the Internet 0.62 (8.90)
v2(59) = 103.31, p < 0.01, GFI = 0.96, AGFI = 0.94, CFI = 0.99,
RMSEA = 0.02, RMSR = 0.03, TLI (NNFI) = 0.98
a
All scales consisted of 5-point Likert questions, ranging from ‘‘1 = strongly disagree’’ to ‘‘5 = strongly agree.’’

TABLE III
Mean, SD, scale reliability, AVE, and correlations

Mean SD AVE 1 2 3 4 5 6 7 8

1. Perceived deception 2.41 0.83 0.54 0.82 0.16 0.11 0.07

2. Satisfaction 4.03 0.85 0.67 -0.40 0.85 0.64 0.09
3. Loyalty intentions 4.06 0.79 0.80 -0.34 0.80 0.92 0.12
4. Attitude toward the Internet 4.08 0.64 0.51 -0.27 0.31 0.35 0.76
5. Product type (0 = services, 1 = goods) na na na -0.13 0.03 0.05 -0.04 na
6. Gender (0 = women, 1 = men) na na na -0.01 -0.01 -0.02 0.00 -0.02 na
7. Education (0 = low, 1 = middle, 2 = high) na na na -0.04 -0.01 -0.01 0.18 0.09 0.19 na
8. Age (years) 30.29 9.76 na -0.10 -0.01 -0.01 -0.01 0.10 0.01 0.04 na

AVE average variance extracted, na not applicable.

Scale composite reliability of multi-item measures is reported along the diagonal. Shared variances of multi-item measures
are reported in the upper half of the matrix. Correlations are reported in the lower half of the matrix. Correlations higher
than 0.09 significant at 95%.

positive and significant (p < 0.01). Discriminant Results

validity was tested by comparing the average variance
extracted by each construct to the shared variance
between the construct and all other variables. For
each comparison, the explained variance exceeded all
combinations of shared variance (see Table III).
Direct and indirect effects
The hypothesized relationships were estimated via
LISREL 8.72. The key benefit of this methodology
 Relational Consequences of Perceived Deception in Online Shopping
in the context of our study is that it allows for a test of
indirect effects. The results indicated a good fit
between the model and the observed data
(v2(32) = 83.34, p < 0.01, GFI = 0.96, AGFI =
0.93, CFI = 0.99, RMSEA = 0.04, RMSR = 0.04,
TLI (NNFI) = 0.99). The model explained 19% and
68% of the variance in satisfaction and loyalty inten-
tions, respectively. The analyses provided strong
support for the direct negative influence of perceived
deception on satisfaction (c = -0.39, t-value =
-5.56), but not on loyalty (c = -0.01, ns). Thus,
supporting Hypothesis 1, but not Hypothesis 2.
In line with Hypothesis 3, satisfaction had a
highly significant influence on loyalty (b = 0.81,
t-value = 8.72).
The relationship between perceived deception
and satisfaction was further studied. In particular, the
indirect influence of deception on loyalty intentions
via satisfaction was examined. The results indicated a
strong and significant indirect relationship between
deception and loyalty (SD coeff. = -0.32; t-value =
-5.32). In fact, as shown in Table III both variables
were highly and significantly correlated (r = -0.34,
p < 0.01). This ‘‘compensates’’ for the insignificant
direct effect of deception on loyalty and shows
that its impact on loyalty is completely mediated by
satisfaction.
To further support the pivotal role of satisfaction
within this model, the hypothesized model (MT) was
compared with a rival model (MU), where the
influence of satisfaction on loyalty intentions was not
estimated. The results of the rival model showed that
both satisfaction and loyalty were significantly
and directly influenced by deception (c = -0.47,
t-value = -6.33; c = -0.40, t-value = -6.02,
respectively). We used a chi-square difference test
(CDT) to test the null hypothesis: MT - MU = 0.
The relevant test statistics (MT has 32 df and a v2 of
83.34, MU has 33 df and a v2 of 301.70) lead to a
highly significant CDT (v2 difference is 218.36 at 1
df, p < 0.01). Consequently, the rival model had a
significantly worse fit to the data compared to the
hypothesized model. Together, these results clearly
indicate the mediating nature of customer satisfac-
tion: the negative influence of deception on satis-
faction, which in turn has an effect on loyalty. These
effects are strong and in the directions predicted.
Once these paths are estimated, any possible direct
effect of deception on loyalty intentions is minimal,
383
supporting a point of view that an assessment of
satisfaction is the process through which deception
alters a consumer’s tendencies toward loyal brand
and firm behavior.
Moderating effects
Hypotheses 4a–b, 5a–b, 6a–c, and 7a–c examined
the effects of the moderating variables on the
deception-consequences link. We tested moderating
effects through multigroup LISREL analyses. The
samples were splitted into subsamples according to
whether consumers scored high or low on the
moderating variables (as far as gender and type of
product are concerned, males versus females and
goods versus services were compared, respectively)
to ensure within-group homogeneity and between-
group heterogeneity. The subgroup method is a
commonly preferred technique for detecting mod-
erating effects (cf. Stone and Hollenbeck, 1989), and
has been extensively used in the literature (e.g.,
Brockman and Morgan, 2006; De Wulf et al., 2001;
Homburg and Giering, 2001).
Following the aforementioned procedures, for
consumer’s attitude toward the Internet and con-
sumer’s age, the sample was median split in two
subgroups, respectively (consumers with a more
positive versus less positive attitude toward the
Internet and older versus younger consumers). For
the remaining moderating variables, the sample was
split into goods and services subgroups, male and
female consumers and more educated (college edu-
cation or higher) versus less educated consumers (no
college education). Then, multiple-group LISREL
was performed comparing two subsamples. More
specifically, two models that are different only with
respect to the effect of deception on the dependent
variable (either satisfaction or loyalty intentions)
were compared. One model restricts this parameter
to be equal across groups (equal model), whereas the
more general model allows this parameter to vary
across groups. Because these are nested models, with
the general model having one degree of freedom less
than the restricted model, the chi-square value will
always be lower for the general model than for
the restricted model. The question is whether the
improvement in chi-square when moving from
the restricted to the more general is significant.
384 Sergio Román
Significance can be assessed on the basis of the chi-
square difference between the two models with the
use of a chi-square distribution with one degree of
freedom.
The results of the multi-group LISREL analyses
are shown in Table IV. As anticipated, the negative
influence of deception on satisfaction was stronger
among individuals who: had purchased a physical
product (c = -0.58, p < 0.05) versus a service
(c = -0.31, p < 0.05), had a more positive attitude
toward the Internet (c = -0.70, p < 0.05) versus a
less positive attitude (c = -0.19, p < 0.05), were
older (c = -0.56, p < 0.05) versus younger (c =
-0.31, p < 0.05), were more educated (c = -0.58,
p < 0.05) versus less educated (c = -0.28,
p < 0.05) and females (c = -0.59, p < 0.05) ver-
sus males (c = -0.34, p < 0.05). In all these cases
the decrease in chi-square when moving from the
restricted (equal) model to the more general model
was significant, providing support for Hypothesis 4a,
5a and 6a–c, respectively.
Interestingly, even though there was no direct
influence of deception on loyalty intentions for the
whole sample, we found some moderating effects
(although not statistically significant at the 0.95
confidence level). In particular, the negative influ-
ence of deception on loyalty was significant when
the product purchased was a physical product
(c = -0.08, p < 0.05), but not when it was a ser-
vice (c = -0.01, ns). The findings also showed that
deception negatively influenced loyalty when con-
sumers had a more positive attitude toward the
Internet (c = -0.12, p < 0.05), but not when
consumers’ attitude toward the Internet was less
positive (c = -0.01, ns). Also, deception influenced
loyalty intentions among consumers who were more
educated (c = -0.08, p < 0.05), but not when they
were less educated (c = -0.01, ns). Overall, these
findings partially support Hypothesis 4b, 5b and 7b,
respectively. As shown in Table IV, age and gender
did not moderate the influence of deception on
loyalty. Therefore, Hypothesis 7a and 7c were not
supported.
Discussion and conclusions
While e-commerce has witnessed extensive growth
in recent years, so has consumers’ complaints
regarding deceptive practices in online shopping.
This study represents the first attempt to analyze
the influence of perceived online deception on
consumer satisfaction and loyalty intentions to the
online retailer. In doing so, this study begins to
address recent calls for empirical research concerning
the effects of online retailers’ deceptive practices on
consumer’s relational variables (e.g., Biswas and
Biswas, 2004; Román, 2007). Unlike previous
research related to Internet deception, that has
mostly been conducted with students being exposed
to artificial hypothetical scenarios, this study used a
sample of real consumers referring to their latest
online purchase, which increases the external valid-
ity of the findings. As predicted, perceived deception
had a strong and negative influence on satisfaction.
In fact, perceived deception alone explained 19% of
the variance in satisfaction. This is noteworthy be-
cause previous studies that have analyzed the influ-
ence of several key antecedents on e-satisfaction (i.e.,
convenience, product offerings, product informa-
tion, site design, and financial security) have not
been able to predict more than 27% (Szymanski and
Hise, 2000, p. 317) and 17% (Evanschitzky et al.,
2004, p. 243) of the variance in e-satisfaction.
Contrary to our expectations, perceived decep-
tion had no direct influence on loyalty intentions
when the relationship between satisfaction and loy-
alty was estimated. Interestingly, further analysis
revealed that deception had a significant and direct
effect on loyalty when the path from satisfaction to
loyalty was not estimated. Overall, this highlights the
key mediating role of satisfaction in the perceived
deception-loyalty link. Also, these results are con-
sistent with those obtained by Ingram et al. (2005) in
a traditional retail context. They found that satis-
faction totally mediated the influence of consumer’s
perceptions of retailers’ un/fairness on consumer’s
behavioral intentions. As noted earlier in this article,
marketing researchers have considered deceptive
practices as unfair practices.
The marketing literature has long evidenced the
positive influence of satisfaction on favorable
behavioral intentions in the traditional context.
Importantly, this study is one of the few to show the
strong and positive influence of satisfaction on loy-
alty intentions in the online context (Anderson and
Srinivasan, 2003; Fassnacht and Köse, 2007).
Drawing on this stream of research, the current study
 TABLE IV
Results of moderating effects

Relationship Moderator variable Chi-square difference Hypothesis

(Ddf = 1) supported
Goods (n = 198) Services (n = 198)

Perceived deception fi SAT c = -0.58 (t = -7.34) c = -0.31 (t = -4.43) Dv2 = 7.33*** H4a supported
Perceived deception fi loyalty c = -0.08 (t = -2.13) c = -0.01 (t = -0.21) Dv2 = 3.15 (p = 0.07) H4b partially supported

More positive attitude toward the Less positive attitude toward

Internet (n = 151) the Internet (n = 247)

Perceived deception fi SAT c = -0.70 (t = -7.18) c = -0.19 (t = -4.43) Dv2 = 25.67*** H5a supported
Perceived deception fi loyalty c = -0.12 (t = -2.63) c = -0.01 (t = -0.41) Dv2 = 3.34 (p = 0.06) H5b partially supported

Older (n = 204) Younger (n = 194)

Perceived deception fi SAT c = -0.56 (t = -7.27) c = -0.31 (t = -4.36) Dv2 = 6.19** H6a supported
Perceived deception fi loyalty c = -0.05 (t = -1.27) c = -0.03 (t = -0.73) Dv2 = 0.15 (ns) H7a not supported

More educated university Less educated no

studies (n = 271) university studies (n = 127)

Perceived deception fi SAT c = -0.58 (t = -8.54) c = -0.28 (t = -3.37) Dv2 = 8.51*** H6b supported
Perceived deception fi loyalty c = -0.08 (t = -2.18) c = -0.01 (t = -0.35) Dv2 = 2.82 (p = 0.09) H7b partially supported

Females (n = 195) Males (n = 203)

Relational Consequences of Perceived Deception in Online Shopping

Perceived deception fi SAT c = -0.59 (t = -7.25) c = -0.34 (t = -5.14) Dv2 = 4.07** H6c supported
Perceived deception fi loyalty c = -0.01 (t = -0.34) c = -0.00 (t = -0.19) Dv2 = 0.8 (ns) H7c not supported

ns Not significant.
**p < 0.05, ***p < 0.01.
385
386 Sergio Román
also focused on behavioral loyalty (i.e., loyalty
intentions), rather than on attitudinal loyalty. This
distinction is particularly relevant since Shankar et al.
(2003) found that loyalty and satisfaction had a re-
ciprocal relationship such that each positively rein-
forced the other in the online environment. In their
research, both constructs were conceptualized and
measured as attitudinal variables. Therefore, our
findings do not contradict Shankar et al.’s study.
Moreover, our results are consistent with the theory
of reasoned action TRA (Fishbein and Azjen, 1975)
that theorizes that consumer’s behavioral intentions
(e.g., loyalty intentions) are determined by attitudes
(e.g., satisfaction).
The study of the moderating effects represents the
first effort in the process of identifying the conditions
under which the deceptive practices of online retailers
are likely to have the greatest negative effects on
consumer satisfaction and loyalty intentions. In par-
ticular, our results revealed that the negative influence
of perceived deception on satisfaction was stronger
among individuals who had purchased a physical
product (instead of a service), had a more positive
attitude toward the Internet, were older, more edu-
cated and females. The analysis of the moderating
effects also produced some interesting and unex-
pected findings. Even though perceived deception
did not have a direct influence on loyalty intentions
when the whole sample was considered, the multi-
group analyses revealed that deception had a direct
effect on loyalty among consumers who (a) had
purchased a physical product, (b) had a more positive
attitude toward the Internet, and (c) were more
educated.7 Also, it is important to note that, as shown
in Table IV, the moderating influence of type of
product, attitude toward Internet and education on
the deception-satisfaction link was statistically stron-
ger (p < 0.01) than when the moderating variables
were age and gender (p < 0.05). Overall, these
findings highlight the key moderating role of type of
product, consumer’s attitude and education on the
influence of deception on satisfaction and loyalty
intentions. These results have key managerial impli-
cations that will be discussed in detail below.
Importantly, we found a direct influence of
deception on loyalty only among individuals who
were more educated. In fact, education was the only
demographic factor that had a moderating role on
the deception-loyalty link. Upon reflection, one
possible reason for this finding may be the normative
view that the core of education itself is virtue or
right conduct (Howard, 1989). Indeed, early re-
search by Rest (1979) provided substantial data to
support that moral judgment was more highly re-
lated to formal education than to age. Accordingly,
we may speculate that more educated consumers are
more ethically sensitive, and consequently they are
more likely to take action (loyalty intentions) to
remedy an unethical/deceptive practice. Also, these
findings parallel, to some extent, those obtained by
Vitell et al. (2001) in a consumer ethics study in the
traditional context. They found that education was
the only demographic variable that moderated the
influence of consumer’s judgments of situations
involving ethical issues on consumer’s behavioral
intentions.
Managerial implications
There are a number of managerial implications
derived from this study. Competing businesses are
only a mouse click away in e-commerce settings, so it
is critical for them to gain a better understanding of
the factors affecting customer satisfaction and loyalty
intentions. Our results highlight the negative conse-
quences of perceive deception on consumer satisfac-
tion and loyalty to the online retailer. Accordingly,
online retailers need to pay close attention to con-
sumers’ perceptions of deception. Derived from our
conceptualization and measurement of deception,
online retailers need to be especially cautious not only
with the information content, but also with the
information presentation in their websites. As for
information content, communication should be
credible and entirely truthful in order to avoid con-
sumers’ perceptions of deception. For example, on-
line retailers should provide realistic information on
product characteristics and benefits. As for informa-
tion presentation, online retailers are encouraged to
pay particular attention to the persuasive power
inherent in visuals and effects and their ability to
distract the consumers’ attention from relevant
information. Also, we advice online retailers to be
judicious in their use of conflicting information via
different media (e.g., exploiting ‘‘picture-superiority-
effect’’ to present deceptive information in images
and truthful information in text).
 Relational Consequences of Perceived Deception in Online Shopping
Our findings revealed that loyalty intentions were
significantly and strongly associated with increased
satisfaction. Firms need to gain a better under-
standing of the relationship between satisfaction and
loyalty in the online environment to allocate their
online marketing efforts between satisfaction initia-
tives and loyalty programs. Therefore, derived from
our results, we encourage online retailers to imple-
ment actions designed to enhance consumer’s satis-
faction.
Finally, this research indicated that while online
retailers should conduct their businesses in an ethical
manner with all consumers (as evidenced by the
direct and indirect effects of deception), the analyses
of the moderating variables revealed that actions
should be taken to explicitly address the ethical
concerns of those target groups who perceive higher
severity of deceptive online retail practices and
consequently punish such practices to a greater ex-
tent. In short, we encourage online retailers to
critically examine their communication approaches
(e.g., providing realistic information about their
offerings that is easily accessible on the website) to
older, more educated, and female consumers as well
as consumers who have purchased a physical product
(instead of a service) and have a more positive atti-
tude toward the Internet. Managers must be aware
that any perceived deceptive practice may quickly
result in dissatisfaction and loss of business, especially
in the cases mentioned earlier. Nevertheless, we do
not imply that online retailers could implement
deceptive practices in those segments of consumers
who are less ethically sensitive.
Limitations and future research directions
Substantively, building on the findings obtained in
this study, several suggestions can be offered for
future researchers. Perceived online deception is a
complex and a highly elusive construct. The present
study focused on product-related deception. How-
ever, the intrinsic nature of the Internet medium
seems to enable several forms of deception, which
were previously virtually impossible to execute in
traditional retail settings. For example, pagejacking –
redirecting the browser from the target location
intended by the user to another location determined
by the deceiver – is a fraudulent scheme that does
387
not have an obvious equivalent in traditional chan-
nels. Therefore, the conceptualization and mea-
surement of perceived online deception needs
further attention from scholars. One additional
limitation and a need for further research concerns
the causality suggested in our findings. The research
design is cross-sectional in nature, and purely causal
inferences remain difficult to make. Hence, evidence
of causality through longitudinal studies is recom-
mended. In addition, the three items used to mea-
sure consumer loyalty intentions covered the two
aspects of loyalty suggested most often in extant
research (word-of-mouth and intended patronage)
and were derived from existing scales. Also the scale
showed satisfactory levels of reliability, convergent,
and discriminant validity. Nevertheless, the use of
additional items, while increasing the survey length,
might improve the measurement properties of the
scale.
This study represents an initial step into the analysis
of the consequences of deception on satisfaction and
loyalty intentions. Further research is needed to ex-
tend the conceptual model. For example, it would be
interesting to analyze to what extent the differences
between the types of goods or the types of services
purchased by the various moderating groups (men
versus women, high education versus low education,
etc.) may be driving some of the differences found
between these groups in our research. Also, prior
research has found that ethical ideologies and the
degree of machiavellianism play an important role in
consumer ethics (Winter et al., 2004). Future research
may analyze the extent to which such variables
moderate the influence of deception on the custom-
ers’ relational variables. Finally, this study focused on
consumers’ perceptions of online retailers’ deceptive
practices. Additional research may analyze to what
extent online retailers provide different information
(e.g., different levels of deception) to different seg-
ments of consumers (e.g., men versus women, older
versus younger consumers).
Notes
1
This research is focused on online shopping sites.
The article does not deal with other Internet sites –
such as online newspapers, portals, free download sites,
customer to customer sites such as eBay or job sites
388 Sergio Román
– that exist for purposes other than online shopping and
that are advertiser supported.
2
All these examples of Internet deception generally
constitute fraud.
3
For the sake of brevity, in the remaining of this arti-
cle we refer to consumer’s perceptions of product-
related online deception as ‘‘online deception’’ or just
‘‘deception.’’
4
Nevertheless, the extent to which deceptive prac-
tices constitute fraud is a complex issue. Early work in
advertising deception already advised about the difficul-
ties of defining, regulating, and establishing the relation-
ship between deception and fraud. For example,
Gardner (1975, p. 40) observed that: ‘‘Unfortunately,
even though the commission has issued many rulings
since 1914, it is not clear that the FTC, or anyone else,
has an adequate understanding of deceptive advertising.’’
Ten years later, Carson et al. (1985, p. 102) cautioned
that: ‘‘The FTC has recently enacted controversial new
standards pertaining to the regulation of deception.’’ This
issue is even more complex in the online context since
the legal definition of Internet fraud is changing and is
inconsistent across national boundaries (Morris-Cotterill,
1999). Authorities in a number of jurisdictions, including
the European Union, the Chinese Government, and
the United States Government have shown substantial
interest in limiting fraudulent practices conducted over
the Internet. Unfortunately, all acknowledge that the
law has not kept pace with the technology and that
enforcement is problematic (Spinello, 2006; Nikitov
and Bay, 2008).
5
These higher standards were applied both to very
straightforward scenarios and to scenarios that were less
clear-cut in ethical terms. For example, ‘‘older consum-
ers were more likely to evaluate such behavior as exag-
gerating the benefits of a product/service, selling
products/services people do not need, and making ver-
bal promises that are not legally binding as unethical
selling behaviour’’ (Ramsey et al., 2007, p. 201).
6
Very often, prior research has relied upon a limited
number of positive word-of-mouth and intended patron-
age items to measure loyalty. For instance, Sirohi et al.
(1998, p. 241) and Cronin et al. (2000, p. 213) used two
intended patronage items and one word-of-mouth item.
Wolfinbarger and Gilly (2003, p. 195) used two repeat
purchase intentions items and three word-of-mouth
items, whereas Johnson et al. (2006, p. 127) and Fassn-
acht and Köse (2007, p. 44) used three intended patron-
age items and two word-of-mouth items.
7
As evidenced in the data, satisfaction and loyalty
were highly correlated (r = 0.80), which reduces the
direct influence of deception on loyalty. Based on one
reviewer’s suggestions we ran additional multigroup
LISREL analyses comparing two subsamples (two mod-
els that are different only with respect to the effect of
satisfaction on loyalty). More specifically, the objective
was to check if the influence of satisfaction on loyalty
was weaker among consumers who (a) had purchased a
physical product versus a service, (b) had a more posi-
tive attitude toward the Internet versus less positive atti-
tude, and (c) were more educated versus less educated.
Yet, the influence of satisfaction on loyalty was not sta-
tistically different in either of the aforementioned cases.
In summary, the direct influence of deception on satis-
faction in theses cases is not caused by a weaker rela-
tionship between satisfaction and loyalty in those
groups.
Acknowledgments
This research was funded by the grant ECO2009-13170
from the Spanish Ministry of Science & Innovation. I
would like to thank Dawn Iacobucci and the two
anonymous reviewers for their many helpful comments
on previous drafts of this article.
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