CHAPTER 6

Conclusion: E-Consumer Protection Now and in the Future

Introduction

This chapter summarizes what has been discussed in the previous chapters and the findings from three case studies of Lazada in Singapore, Shopee in Vietnam, and Zalora in Malaysia. It also draws some conclusions that may offer new insights pertaining to e-consumer protection to various groups of stakeholders. E-consumer protection is a complex, multidimensional, and challenging task given the anonymity and the cross-border, speed, and transient nature of e-retailing (Ha 2012, 2017; Ha and Coghill 2008; Ha, Coghill and Maharaj 2009; Ha and McGregor 2013). The nature of e-retailing makes it difficult for e-consumers to identify fraudulent e-retailers and for relevant organizations to take action against them.

Even though different sectors have worked with one another, the current three-sector governance framework, including the public sector, the private sector, and the civil society, does have shortcomings that require a new or modified governance approach to address the existing and ongoing problems associated with e-consumer protection. Given the technical, legal, and human behavior-related nature of the issues of e-consumer protection, it requires various groups of stakeholders to adopt a mixture of legal framework (e.g., legislation, guidelines, and codes of practice), technological measures (e.g., digital seal and certificate), and human behavior-related measures (e.g., education) to address these issues (OECD 2016, 2018, 2019; World Economic Forum 2013, 2019).

Nevertheless, e-consumers are the subjects of e-transactions and the recipients of any policies. Thus, the “four-sector governance framework,” including government, e-retailers, civil society organizations (industry and consumer associations), and e-consumers, has been proposed. It emphasizes cooperation among the four sectors. Importantly, the roles of e-consumers in self-protection to facilitate better governance and enhance the effectiveness of regulatory and self-regulatory measures to address e-consumer protection are stressed in the proposed framework. Given the limited ability and capacity of consumers in self-protection, which was evidenced through the number of complaints and disputes, better and effective e-consumer education and strong support from other groups of stakeholders to assist e-consumers to fulfill their responsibilities are required. The incentive for e-consumers to exercise their responsibilities is their desire to enjoy the advantages of e-retailing; and for consumer associations it is the desire to enhance credibility and have a stronger voice in e-consumer issues. The incentive for e-retailers to fulfill their roles is the desire to attract and retain e-consumers via trust and reputation building; and for industry associations it is the desire to protect the interests of the entire industry.

Policy Implications

Several policy implications arise from this work. First, the six issues associated with e-consumers are interrelated and must be addressed simultaneously. Failure to address any one of these issues would seriously compromise e-consumer protection since the violation of one basic consumer right would lead to the breach of many others.

Second, given the increase in cross-border online fraud and complaints, the research findings strengthen the proposition that governance is important in the achievement of the expected outcomes of the policy framework for e-consumer protection (OECD 2013, 2015). Although insufficient good governance is a common problem applicable to almost all industries, it is more serious in e-retailing because consumers have to face different forms of risks, and it is difficult to investigate such risks when they surface. Above all, lack of governance impedes the success of e-retailing by weakening consumer trust and confidence in e-retailing, in government, and in CSOs (Ha 2017; Ha and McGregor 2013). Thus, the issues associated with e-consumer protection must be addressed through specific actions of each governance sector and common responsibilities of all sectors.

Third, although self-regulation has been encouraged, government still plays an important role in e-consumer protection. Consumers and CSOs are more confident in activities of government than self-regulatory measures adopted by e-retailers to protect e-consumers (Ha 2017; Shergold 2016). Even e-retailers need to work closely with the authorities to discharge their duty in e-consumer protection. However, it is impossible for government, by itself, to address the issues associated with e-consumer protection since the rules of e-retailing cannot be made by governments alone. A more focused effort and an integrated approach involving government, e-retailers, industry and consumer associations, and consumers for improving governance and enhancing consumer trust and confidence could facilitate e-consumer protection and the full potential of e-retailing.

Fourth, e-consumers have to play an active role in self- protection. However, many e-consumers may not practice sufficient self- protection when shopping online due to lack of awareness of online risk. Thus, e-consumer education can empower e-consumers with knowledge and understanding to exercise their rights and social responsibilities in e-retailing (Ha and McGregor 2013). Given the multifaceted nature of problems with e-retailing, e-consumer education needs to focus on technical, legal, and human behavioral aspects regarding e-retailing. A single governance sector may not have sufficient resources and expertise to deliver effective e-consumer education. Again, a joint force of all involved parties could increase the success of such educational activities (OECD 2016; World Economic Forum 2017, 2019). Educational programs can also be tailored by the relevant organizations to increase the level of awareness among e-retailers of their social responsibility and the benefits of providing protection to their customers.

Fifth, it is in the interest of e-retailers to provide protection to their customers since protecting their customers means protecting their business. Self-regulation, voluntary guidelines, and codes of practice do not work well without the willingness of e-retailers to comply with such measures. E-retailers need to go beyond what is required by law to gain competitive advantage and rebuild their reputations since e-consumers appeared to have lack of trust in e-retailers (Ha et al. 2009). Thus, this study suggests that e-retailers should practice CSR and address complaints to enhance e-consumer trust and confidence in e-retailers which, in turn, can change consumers’ perceptions of the credibility of the e-retailing industry.

Finally, advanced technological applications have been employed by both e-retailers and e-consumers to enjoy the benefits of e-retailing (Ha 2011, 2013a, 2013b). However, cyber wrongdoers also try to make use of high-tech applications to commit offences. It was found that appropriate technological applications can ensure the security of a system. Thus, the use of technology can contribute to enhancing e-consumer protection. A system must be designed in a way that it is both user-friendly and able to prevent and detect online incidents.

Future Research

Governance to address e-consumer protection is a relatively new area of research, especially in ASEAN. Given that both literature and empirical studies on this topic are currently limited, the findings from this work can serve as a preliminary source for further research. The following issues are not exhaustive, but rather are those of most interest and relevance to e-consumer protection.

First, the proposed governance framework could be initially tested in the e-retailing industry. Further modification could be made based on the experiences gained from the pilot tests. Since the proposed framework addresses the generic problems of improving governance, it can be employed in other sectors.

Second, future research could examine the roles of the media in the dissemination of information which could increase the level of awareness of the public. Educational programs via traditional and social media could have more effect on e-consumers since such media channels can create viral content. The media can easily expose offensive cases to the wider audience. Broadcasting unacceptable behavior of unscrupulous e-retailers on the Internet, via self-help and customer review sites, induces e-retailers to behave better and exhibit respect for consumer rights. However, in this approach, care must be taken to avoid legal implications.

Finally, exploration of the motivations and behaviors of e-consumers about not taking precautions to protect themselves from online incidents can also be a subject of future research. Investigation of the types of problems e-consumers have encountered would help consumer educators tailor appropriate educational programs to suit different groups of consumers. Also, at the macro level, many questions present opportunities for further research, such as “Has the failure or the delay to revise laws created issues? Is there any relationship between the culture of a given country and consumer protection in the country? Do international laws and regulations formulated in Western nations fit Eastern nations?”1

Concluding Remarks

This final chapter has summarized the entire volume to address the research objectives stated in the introduction. It has reinforced the arguments for the proposed integrated “four-sector governance framework” to address e-consumer protection. This volume suggests that the three-sector governance framework has limited success, although several measures have been implemented to protect e-consumers. Importantly, nonuniform standards and regulations, weak enforcement of laws, and insufficient participation and cooperation among different groups of stakeholders have impacted the effectiveness of the current measures to protect e-consumers. As a result, e-consumers receive different levels of protection from different e-retailers. Finally, e-consumer ignorance about their basic rights, the current measures to protect them, and their lack of awareness of self-protective measures have weakened their ability to protect themselves in the online market.

The application of the proposed “four-sector governance framework” has the potential to address e-consumer protection more effectively. The proposed framework is distinct from the current framework in terms of stronger cooperation among all sectors, the inclusion of e-consumers, and more involvement of e-retailers for a greater consumer confidence and trust in e-retailing.

In conclusion, this study has addressed the knowledge gaps caused by insufficient information and research on governance and e-consumer protection and has achieved its key objectives of improving the understanding of issues associated with governance and e-consumer protection. It has also provided a better insight into how the conventional governance framework can be improved and an avenue for further research on e-consumer protection.

References

Ha, H. 2012. “Online Security and Consumer Protection in Ecommerce - An Australian Case.” In Strategic and Pragmatic E-Business: Implications for Future Business Practices ed. K.M. Rezaul. 217–243. Hershey, PA: IGI Global.

Ha, H. 2013a. “Credit Card Use and Risks in the E-Market: A Case Study in Melbourne, Australia.” In E-Marketing in Developed and Developing Countries: Emerging Practices eds. H. El-Gohary and R. Eid. 214–232. USA: IGI Global.

Ha, H. 2013b. “Credit Card Use and Debt by Female Students - A Case Study in Melbourne, Australia.” Youth Studies Australia 32, no. 4, Online.

Ha, H. 2017. “Stakeholders’ Views on Self-Regulation to Protect Consumers in E-Retailing.” Journal of Electronic Commerce in Organizations 15, no. 3, pp. 83–103.

Ha, H., and K. Coghill. 2008. “Online Shoppers in Australia: Dealing with Problems.” International Journal of Consumer Studies 32, no. 1, pp. 5–17.

Ha, H., K. Coghill, and E.A. Maharaj. 2009. “Current Measures to Protect E-consumers’ Privacy in Australia.” In Online Consumer Protection: Theories of Human Relativism, eds. K. Chen and A. Fadlalla, 123150. Hershey, PA: Idea Group, Inc.

Ha, H., and S.L.T. McGregor. 2013. “Role of Consumer Associations in the Governance of E-commerce Consumer Protection.” Journal of Internet Commerce 12, no. 1, pp. 1–25.

OECD. 2013. “Trust in Government, Policy Effectiveness and the Governance Agenda.” In Government at a Glance 2013. Paris; OECD.

OECD. 2015. Industry Self-Regulation: Role and Use in Supporting Consumer Interests. Paris: OECD.

OECD. 2016. Consumer Protection in E-commerce: OECD Recommendation. Paris: OECD.

OECD. 2018. Toolkit for Protecting Digital Consumers: A Resource for G20 Policy Makers.

Shergold, P. 2016. “Three Sectors, One Public Purpose.” In The Three Sector Solution: Delivering Public Policy in Collaboration with Not-for-Profits and Business, eds. J.R. Butcher and D.J. Gilchrist, 23–32. Canberra: ANU Press.

World Economic Forum. 2013. The Future Role of Civil Society. Cologny/Geneva: World Economic Forum, and KPMG International.

World Economic Forum. 2017. Agile Governance Reimagining Policy-making in the Fourth Industrial Revolution. Cologny/Geneva: World Economic Forum.

World Economic Forum. 2019. The Global Governance of Online Consumer Protection and E-commerce Building Trust. Cologny/Geneva: World Economic Forum.

1 The author would like to thank Dr. Stanley Bruce Thomson for his comments and insights.

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