The market share of online purchasing is under two percent of total retailspending, which provides an indication that consumers have been slow to adoptonline purchasing. Previous research has shown that consumers perceive risksassociated with purchasing online and these perceptions are likely to affectpurchase intention. Little research, however, has been done on perceived riskrelating specifically to online purchasing, and in particular, risk related to brandedand non-branded retailer websites. Research has shown that brand knowledgehas a direct effect on a consumer’s intention to purchase from an online retailerand that this relationship between brand knowledge and intent to purchase onlineis mediated by perceived risk. The purpose of this exploratory study wastherefore to investigate the consumer-perceived risks associated with theintention to purchase online.The research problem considered the question whether the perceived risks(financial, performance, physical, time, social and psychological risks) associatedwith a branded website (Kalahari.net) are different from the perceived risksassociated with a non-branded website (Books.com).It was found that four types of perceived risk exist namely, performance, time,social, and personal risk. Of these risks, only performance risk had an influenceon a consumer’s purchase intention from a non-branded website whereasperformance and personal risk influenced a consumer’s intention to purchasefrom a branded website. It was also revealed that consumers perceiveperformance, time, and social risk as not statistically different when purchasingfrom a non-branded or a branded website. However, personal risk was perceivedto be statistically differently for the two websites.In addition, the brand image dimension of brand knowledge had an influence on a consumer’s purchase intention from both the branded and non-branded websites. The brand awareness dimension of brand knowledge did not influencepurchase intention at all. For all four risk types on both the branded and nonbrandedwebsites (except social risk on Books.com), at least one and in somecases, both dimensions of brand knowledge influenced the degree of perceivedrisk associated with purchasing on the particular website. Finally, it wasconcluded that the more information search a consumer does before purchase ofa book on a branded or non-branded website, the higher their perceived riskassociated with purchasing from the particular website.A number of recommendations were made. Methods for decreasing the amountof performance risk which consumers perceive when purchasing a book onlinewere firstly suggested. It was further recommended that Kalahari.net investigatethe dimensions of their brand such as brand image, brand awareness, and brandtrust, to identify the reasons why consumers perceive performance, social andtime risk as being not statistically different when purchasing on a branded and anon-branded website. Since consumers did not see a difference between thebrand image of the branded and the non-branded websites, it was recommendedthat the branded website make every effort to investigate their current brandingstrategy to identify the reasons consumers view the branded website in the samemanner as the non-branded website. Furthermore, since both dimensions ofbrand knowledge influenced the degree of perceived risk associated withpurchasing on the particular website to a certain extent, it was recommended thatonline retailers focus on building familiarity, positive thoughts, feelings,associations, and beliefs concerning the online retailer brand. Finally, it wasrecommended that the influence of information search online on perceived riskassociated with purchasing be further investigated; because this study found thatan action that was traditionally initiated as a means for decreasing perceived riskcan now be attributed to increased consumer-perceived risk associated withonline shopping.
