Social Information Disclosure of Friends in Common in an E‐commerce Platform Ecosystem: An Online Experiment

Abstract

Real social information is believed to cause a trust–privacy paradox in e‐commerce platforms, with the degree of information disclosure affecting platform performance. In this study, we split the mixed influence into the direct trust mechanism and the indirect privacy mechanism, studying each in the context of partial and full social information disclosure, respectively. Using unique data from an 80‐day large‐scale online experiment conducted in an e‐commerce platform in China, we show that a partial social information disclosure could reduce the conversion rate, while a full social information disclosure could promote both the conversion and sales rates of the e‐commerce platform through a trust mechanism. Moreover, social information disclosure would reduce the sales rate and promote the conversion rate through a privacy mechanism. However, even though the degree of privacy could enhance the privacy mechanism, this mechanism is still much weaker than a trust mechanism. Overall, social information could play a positive role in e‐commerce platforms if it is fully disclosed. This study encourages cooperation between social media platforms and e‐commerce platforms by introducing a real social relationship into the online trading market.