THE IMPACT OF PERCEIVED RISK ON ONLINE PURCHASE INTENTION OF ONLINE SHOPPERS IN COLOMBO DISTRICT

Abstract

The present study tends to provide an in-depth knowledge about the perceived risks associated with the peoples who do their purchases through internet. The study focused on perceived risks and analyzed the relative significance of perceived risk dimensions on intention to shop online. Survey data was collected from 384 online shoppers by using convenience sampling method and 318 usable self-administered online questionnaires were used for further analysis. Multiple and linear regressions were used to achieve the research objectives and to test the research hypotheses. The results of this study were revealed that there is a significant negative impact of perceived risk (β = -1.069, ρ<0.000) on online purchase intention. Further it was revealed that there is significant negative impact of product risk(β = -0.200, ρ<0.000), security risk(β = -0.438, ρ<0.000), time risk(β = -0.140, ρ<0.000), and psychological risk (β = -0.206, ρ<0.000) on online purchase intention respectively while there was no impact of financial (β = - 0.019, ρ>0.607)and social risks (β = -0.014, ρ>0.743)on online purchase intention. This in-depth knowledge about online shoppers’ perceived risk on intention to shop online directly affects the online shopping performances for achieving a better ecommerce market in Sri Lanka. This research will add practical implications for online retailers on designing their product information, security policies, safety and privacy mechanisms and selecting shipping service providers.