A Social Cognitive Perspective on Channel Preference: A Study of Online Investing

Understanding the mechanisms by which consumers choose to conduct their business activities via the online channel represents an important concern for Web designers, marketers, and public policy makers alike. This study develops a research model based on Social Cognitive Theory to explain and predict channel preference. The model is subsequently tested in an online investing context using observations obtained via survey. The results suggest that task-specific self-efficacy beliefs serve as the activating mechanism kicking off a chain of psychological events that entice consumers to favor a particular channel. In addition to its direct effects on preference for the online approach, higher levels of self-efficacy influence one’s propensity to take risks and expectations of performance-oriented rewards, which, in turn, sway consumers to favor the online channel. Furthermore, self-efficacy and perceptions concerning the credibility of online information interact to influence channel preference. Consumers are most likely to conduct their business activities online when they view themselves as capable and perceive online sources to be credible. Implications for theory and practice are discussed in light of the findings.