Consumer fear hinders local e-shopping

Australian consumers are reluctant to purchase online because of fears surrounding use of their credit card.

Research conducted by Citibank claims that Australian e-tailers are missing out on opportunities because 60 per cent of respondents don't trust the Internet with their credit card and almost 50 per cent don't want to give away private information over the Internet due to fears of credit card fraud, hacking and other security problems.

Other concerns raised included would-be customer uncertainty about how to return faulty products, the length of delivery time, preference for human contact and hesitance to pay for shipping costs.

Research highlights include:

* There appears to be two distinct groups of online shoppers - heavy users who access the Internet at least once a day and transact at least once a week, and light users who go to the Internet at least once a week and transact once a month.

* 45 per cent of respondents preferred to get out and visit regular shops;* 30 per cent use the Internet to research products and then purchase in retail outlets;* For most of the respondents, their readiness to shop online is determined by the ability to minimise the perceived risk involved.

As a result, online customers tend to shop at those sites that have an ‘in-built trust factor'. These were described as ‘big familiar sites from companies with recognised reputation and credentials.' Purchases tended to be confined to ‘low cost and easily transportable items' and made with the view that ‘there is less risk of damage and it's no big loss if the products don't arrive'. Citibank puts the median spend online of its iCard customer base at $49.

The Australian online merchants that rated the highest with Citibank iCard customers were, Interflora and

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