DEVELOPING A MODEL OF MULTI-CRITERIA DECISION MAKING FOR CUSTOMER UNCERTAINTY IN ONLINE PURCHASING (MCDM-UnOP)

Abstract

The growth of the internet market has attracted more customers to purchase products online. Despite its popularity, there is a significant issue concerning customer uncertainty when making decisions to purchase online. Therefore, this research aims to develop, validate, and prioritize a model of multi-criteria decision making for customer uncertainty in online purchasing, known as the MCDM-UnOP model. This study used a mixed methods approach. The MCDM-UnOP model was developed based on the results of a comprehensive literature review and qualitative focus group interviews. A questionnaire was employed as the research instrument to collect quantitative data from internet users. A total of 348 usable questionnaires were collected and proceeded to the data analysis stage. Exploratory Factor Analysis (EFA) and Confirmatory Factor Analysis (CFA) using the split half method were conducted to validate the MCDM-UnOP model. The Analytical Hierarchy Process (AHP) technique was applied to prioritize the criteria associated with customer uncertainty in online purchasing. The validation process identified six key MCDM-UnOP criteria: security, shipping and delivery, privacy, product quality, financial risk, and psychological factors. These six criteria were measured using 34 sub criteria. The results of the AHP analysis indicated that security was the most important criterion, followed by privacy, shipping and delivery, product quality, and financial risk. The least important criterion was psychological factors. The findings provide valuable implications for decision makers in the online business industry to develop effective strategic marketing tools and to achieve a competitive advantage.