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htm

IMDS 109,3

What drives Malaysian m-commerce adoption? An empirical analysis

Toh Tsu Wei
Panasonic R&D Centre Malaysia Sdn Bhd, Cyberjaya, Malaysia

370
Received 13 June 2008 Revised 22 August 2008 Accepted 11 September 2008

Govindan Marthandan
Faculty of Management, Multimedia University, Cyberjaya, Malaysia

Alain Yee-Loong Chong

Faculty of Computing and IT, INTI International University College, Nilai, Malaysia

Keng-Boon Ooi
University Tunku Abdul Rahman, Kampar, Malaysia, and

Seetharam Arumugam
Faculty of Management, Multimedia University, Cyberjaya, Malaysia
Abstract
Purpose This study aims to empirically examine the factors that affect the consumer intention to use (IU) mobile commerce (m-commerce) in Malaysia. The ve factors examined in this study are perceived usefulness (PU), perceived ease-of-use (PEOU), social inuence (SI), perceived cost and trust. Design/methodology/approach The study sample consists of 222 respondents with a response rate of 84.09 per cent. Data were analyzed by employing correlation and multiple regression analysis. Findings The ndings revealed that PU, SI, perceived nancial cost and trust are positively associated with consumer IU m-commerce in Malaysia. In addition, PEOU and trust were found to have an insignicant effect on consumer IU m-commerce in Malaysia. Research limitations/implications The generalizability of the ndings is limited as the study focuses only on Malaysia. Practical implications Based on the ndings, companies involved in m-commerce should focus on improving the usefulness of the system, trust (i.e. security and privacy protection) and reducing the cost of m-commerce services to improve the adoption of m-commerce. Originality/value The ndings made a contribution in terms of allowing us to understand the factors that can contribute to the adoption of mobile commerce. This study successfully extend the TAM model in the context of mobile commerce by incorporating one trust-based construct (trust), one behavioural control construct (perceived nancial cost) and one subjective norm construct (SI). This extended TAM model provides a greater understanding of user acceptance of mobile commerce in Malaysia. Keywords Mobile communication systems, Consumer behaviour, Malaysia Paper type Research paper
Industrial Management & Data Systems Vol. 109 No. 3, 2009 pp. 370-388 q Emerald Group Publishing Limited 0263-5577 DOI 10.1108/02635570910939399

Introduction The current business environment is getting more competitive. In order for many companies to stay competitive, businesses have always strived to improve themselves

by creating better products and services for their customers. With the recent emergence of the wireless and mobile networks, a new platform for business to trade their product and service known as m-commerce is beginning to gather attentions from businesses. Unlike e-commerce where the connectivity is through internet, m-commerce is connected wirelessly in a mobile environment using mobile devices. M-commerce has much potential in developing countries as small- and medium-sized companies in remote areas can use them to reach many potential customers (United Nations, 2002). Prior to the development of m-commerce, e-commerce was depended on costly infrastructure and equipments such as computers and xed line network. m-Commerce offers more ubiquity and accessibility to the users when compared to e-commerce. The accessibility of m-commerce is an advantage over e-commerce as e-commerce applications usually need a wired end-user device (Schwiderski-Grosche and Knospe, 2002). As mobile devices are small in size and light in weight, it is also very convenient for users to carry around the device (Schwiderski-Grosche and Knospe, 2002). Given that mobile devices are usually owned by individual and not shared between different users, m-commerce allows the services to be catered towards the users needs (e.g. ring tones) (Schwiderski-Grosche and Knospe, 2002). Although there are lots of potentials for businesses in m-commerce, when compared to developed countries such as Japan and South Korea, m-commerce in Malaysia is still at its infancy stage (Wong and Hiew, 2005). The adoption of technologies such as 3G and WiMax are still relatively low in Malaysia when compared to these developed countries. Past studies have attempted to investigate the factors that can inuence the adoption of m-commerce. However, many of these studies are carried out mainly in countries such as the USA, China and Taiwan. Most of the earlier studies have attempted to study the factors inuencing m-commerce adoption through traditional adoption models such as technology acceptance model (TAM), theory of planned behaviour (TPB) and diffusion of innovation (DOI). However, except for a few recent studies (Liao et al., 2007; Khalifa and Shen, 2008), there has been a general lack of strong empirical work to enable the establishment of models to nd out the factors that can explain the adoption of m-commerce. The purpose of this study is to ll existing research gap by empirically establishing a model to explain the factors impacting the adoption of m-commerce in Malaysia. An empirical analysis is conducted to test the hypotheses of the adoption. This paper is organized as follows: . providing a literature review on adoption factors of m-commerce; . developing a research model based on literature review; . addressing the research methods; . discussing the research ndings; and . discussing the practical and managerial implications of this study. Literature review m-Commerce As m-commerce is a relatively new concept, there have been various denitions of m-commerce. Abu Bakar and Osman (2005) dened m-commerce as exchange or buying and selling of commodities and services through wireless handheld devices such as cellular telephones and personal digital assistant (PDAs). Moshin et al. (2003) stated that the most common denition of m-commerce actually represents the

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IMDS 109,3

372

extension of electronic commerce. In other words, m-commerce is seen as an e-commerce over the wireless devices (Varshney and Vetter, 2002). However, Feng et al. (2006) suggested that m-commerce is more than e-commerce due to its different interaction style, usage pattern and value chain. Feng et al. (2006) stated that m-commerce is a new and innovative business opportunity with its own unique characteristics and functions, such as mobility and broad reachability. Moshin et al. (2003) extended the term of m-commerce to mobile business. Mobile business according to Moshin et al. (2003) is the business-related communication that is conducted among individuals and companies that does not necessarily involve nancial transaction. Tiwari and Buse (2007) stated that m-commerce is an integral subset of m-business since the services provided by m-business covered both commercial and non-commercial areas. It can be seen that mobile business has a larger scope since all aspects of m-commerce take place in mobile business. Tiwari and Buse (2007) argued that the transaction of monetary value was inappropriate in dening m-commerce because it ignores the commercial nature of marketing measures and after-sales services. Besides, the completed transaction may cost nothing such as free software, games and music. Furthermore, they also argued that statement with wireless telecommunication networks mislead people that transactions had to be completed exclusively through wireless telecommunication networks. This limits the scope of m-commerce to only immaterial products (e.g. information), which normally ignore the material products. From the above denitions and discussions, the denition of m-commerce in this study follows the denition of Tiwari and Buse (2007, p. 33) since it comprises various sources about the nature of m-commerce. Thus, m-commerce is dened as any transaction, involving the transfer of ownership or rights to use goods and services, which is initiated and/or completed by using mobiles access to computer-mediated networks with the help of mobile devices. Factors affecting the adoption of m-commerce Past studies included various frameworks and models to clarify the factors or determinants inuencing the acceptance of technology in consumer context. Most of them are based on theories such as TAM (Davis, 1989), TPB (Ajzen, 1991) and DOI (Rogers, 1995). TAM proposed that perceived usefulness (PU) and perceived ease-of-use (PEOU) are both able to predict the behavioural IU a technology of users. PU is the extent to which an individuals expectation that the use of the technology will improve ones job performance whereas PEOU is the belief that using the technology will be free of effort (Davis, 1989; Fusilier and Durlabhji, 2005). TPB was extended from theory of resonated action (TRA). Besides, technological factors, TPB also focused on social and individual factors (Khalifa and Shen, 2008). The theory of planned behaviour stated that behavioural intention to perform an activity is determined by attitude, perceived behavioral control, and subjective norm (Ajzen, 1991; Fusilier and Durlabhji, 2005). Attitude is dened as a persons feelings about performing behaviour. Perceived behavioural control is dened as the perception of how easy or difcult it is to perform a behaviour (Fusilier and Durlabhji, 2005, p. 234) and subjective norm is dened as ones beliefs about whether signicant others think that one should engage in the activity (Fusilier and Durlabhji, 2005, p. 234).

DOI theory stated that there are ve perceived attributes of an innovation that can determine the rate of adoption (Rogers, 1995; Chong and Ooi, 2008). The ve perceived attributes of the innovation are relative advantage, compatibility, complexity, trialability and observability (Rogers, 1995). Relative advantage is the degree to which an innovation is perceived as being better than the idea it supersedes. Compatibility is dened as the degree to which an innovation is perceived as consistent with past values, past experience, and the needs of the potential adopters. The complexity of an innovation is whether the innovation is perceived as relatively difcult to use and understand. Trialability refers to whether an innovation may be experimented with on a limited basis. Lastly, observability is whether the results of an innovation are visible to others (Rogers, 1995). There are strengths and weaknesses for each of the models discussed above. Mathieson et al. (2001) stated that TAM is being widely used in adoption studies as it is information system (IS) specic and is based on a theory of social psychology. However, Mathieson et al. (2001) argued that TAM is limited by the lack of barriers that inhibit the individual from using an IS if he or she choose to do so. Although TPB model does not have the strengths possessed by TAM but it provides two constructs that did not appear in TAM model: subjective norms and perceived behavioral control (Mathieson et al., 2001). TPB include more effects and variables than TAM that may be important in some situation. Taylor and Todd (1995) have compared TAM with TPB in their adoption of computing resource centre study and found that TAM explains 53 per cent of the variance in behavioral intention while TPB explains 57 per cent. In order to make TPB more IS specic; they introduced a new model which integrated TPB with TAM by including 13 constructs. Even though this new model managed to explain 60 per cent of the variance in behaviour intention, it increased the model complexity greatly (Mathieson et al., 2001). Hence, this approach is not considered in this study. Instead of adopting Taylor and Todds approach, another approach is to extend TAM by adding appropriate constructs derived from TPB or DOI. This extended TAM retains the underlying simplicity of the TAM and improve the ability to predict and explain IS usage at the same time (Mathieson et al., 2001). Prior empirical studies have validated the better prediction capabilities of extended TAM (Wang and Barnes, 2007; Chang, 2004; Kurnia et al., 2006; Liao et al., 2007; Wong and Hiew, 2005; Mallat et al., 2006; Cho et al., 2007; Lin and Wang, 2005; Luarn and Lin, 2005). In order to enhance the prediction of usage intention of m-commerce in Malaysia while retaining the model simplicity, this study selects the approach that extends the TAM by including three additional constructs: social inuence (SI), perceived cost and trust, SI and perceived cost are the constructs derived from TPB and DOI theories. Besides, incorporating three additional constructs into original TAM, there are another two major differences between the original TAM and the proposed research model. Firstly, since m-commerce is still at its infancy stage in Malaysia (Wong and Hiew, 2005), the investigation of intention to use (IU) m-commerce is chosen to examine the adoption of m-commerce instead of actual use in the study (Lu et al., 2003; Liao et al., 2007). Secondly, the attitude construct has been removed from the model for simplicity purpose (Luarn and Lin, 2005). The new extended TAM in this study is shown in Figure 1.

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IMDS 109,3

Perceived Usefulness

H1 H2 H3 H4 Consumer intention to use m-commerce

Perceived Ease of Use

374
Social Influence

Trust

H5

Figure 1. Research model

Perceived Cost

Hypotheses development Perceived usefulness PU is dened as the degree of which an individual believes that using a system would improve his or her job performance (Davis, 1989). The effect of PU on IU has been validated in many existing studies (Luarn and Lin, 2005; Lin and Wang, 2005; Guriting and Ndubisi, 2006). For example, Wong and Hiew (2005) suggested that the usage of m-commerce is strongly driven by the usefulness of the mobile service, which includes ubiquity, personalization, localization, timeliness and network stability. Hence, in this study, PU is dened as the extent to which individual believes that the use of m-commerce will improve his or her job performance and daily activities. This construct not only assess the extrinsic characteristics of m-commerce, but it also shows how m-commerce can help the users to achieve task-related goals, such as effectiveness and efciency (Ho and Kwok, 2003). Hence, the hypothesis is proposed as: H1. PU has a positive effect on consumer IU m-commerce in Malaysia. Perceived ease-of-use Although an individual may believe that an application is useful, he or she might also nd that the system is difcult to use (Davis, 1989). PEOU has been considered as an important determinant in adoption of past information technologies such as intranet (Chang, 2004), 3G (Liao et al., 2007), online banking (Guriting and Ndubisi, 2006; Jahangir and Begum, 2008), wireless internet (Lu et al., 2003), internet commerce (Cho et al., 2007) and m-commerce (Lin and Wang, 2005; Wang and Barnes, 2007; Kurnia et al., 2006; Mallat et al., 2006; Luarn and Lin, 2005). According to Rogers (1995), complexity of one particular system will become the inhibitor that discourages the adoption of an innovation. Once again borrowing from Davis (1989), PEOU refers to the degree to which an individual believes that using m-commerce would be free of physical and mental effort. For example, someone may nd using services on mobile devices tedious and complex due to the constraints of physical features of m-commerce such as its small display

screen or difculty in keying in data. Consequently, m-commerce must be easy-to-use or learn and the following hypothesis is proposed: H2. PEOU has a positive effect on consumer IU m-commerce in Malaysia. Social inuence SI according to Lu et al. (2003) is equivalent to subjective norm and is dened as an individuals belief about whether signicant others think that one should engage in the activity. Subjective norm is studied in both TRA and TPB as the important determinant to explain the adoption of a system. Chang (2004) found that social factor, which is derived from TPB, can enhance the validity of the TAM in intranet usage. Based on DOI theory, SI can be divided into two forms: mass media and interpersonal inuence (Rogers, 1995). Mass media inuence includes newspapers, magazines, academic journals, television, radio, internet, and other applicable mediums. Interpersonal inuence normally comes from social network such as peers, friends, superiors and so on (Rao and Troshani, 2007). Fan et al. (2005) stated that user is more likely to suggest and recommend a service to others, if he or she is satised with the service. Their nding also revealed that SI had more impact on users acceptance of m-commerce than PU and PEOU. Khalifa and Cheng (2002) also found that SI had strong effect on consumer IU the m-commerce. Hence, the following hypothesis is proposed: H3. SI has a positive effect on consumer IU m-commerce in Malaysia. Perceived cost Price or cost factor is one of the reasons that could slow down the development of m-commerce. Cost factor may consist of initial purchase price (e.g. handset fee), ongoing usage cost (subscription fee, service fee and communication fee), maintenance cost and upgrade cost (Luarn and Lin, 2005). Pagani (2004) stated that price or cost factor was one of the main determinants of 3G services adoption. Anil et al. (2003) also stated that cost is one of the factors inuencing the adoption of m-commerce in Singapore. Sathye (1999) stressed the importance of price or cost factors in adoption of innovations. He stated that cost is one of the reasons that prevent consumers from Singapore and Australia to use internet banking. Carlsson et al. (2006) also found that cost related issues is more important than privacy and security issues when it comes to the adoption of 3G services among users in Finland. In this study, the cost factor is tested in Perceived cost construct which is dened as the extent to which individual perceive that using m-commerce is costly. Thus, the following hypothesis is proposed: H4. Perceived cost has a negative effect on consumer IU m-commerce in Malaysia. Trust Trust is an important element affecting consumer behaviour and it determines the success of technologies adoption such as e-commerce (Holsapple and Sasidharan, 2005). There are various denitions of trust in existing literatures. Cho et al. (2007) dened trust from the business point of view, and dened it as buyer-seller relationships as the perception by a prospective buyer of credibility and benevolence in the target of trust. Pavlou (2003) stated that trust in e-commerce is the belief that

Malaysian m-commerce

375

IMDS 109,3

376

allows consumers to willingly become vulnerable to the online retailers after having considering the retailers characteristics. This denition is consistent with the construct of trust as a salient belief that includes goodwill trust (benevolence) and credibility (honesty, reliability, and integrity) (Chew, 2007; Pavlou, 2003). The denition of trust from Pavlou (2003) captured two distinct but inseparable facets of trust in ecommerce. It involves the traditional view of trust in a specic party (online companies) as well as implicitly encompasses trust in the integrity of the transaction medium (internet security technology) (Chew, 2007; Pavlou, 2003). Trust is more crucial and complex in environment such as e-commerce and m-commerce than general and traditional commerce due to its uncertain environment (Lu et al., 2003; Cho et al., 2007) and information asymmetry (Cho et al., 2007). The buyers and sellers normally complete the transaction through these technologies will not necessary meet each other face to face. The buyers will thus be worried that their personal information and money will be transferred to third party without their knowledge (Luarn and Lin, 2005). Sathye (1999) identied security concern as the biggest obstacle to adoption of online banking in Australia. According to Lu et al. (2003), m-commerce is exposed to greater danger of insecurity than e-commerce and therefore the importance of trust is relatively higher in m-commerce. Luarn and Lin (2005) found that perceived credibility (security and privacy) has a stronger effect on consumer IU mobile banking than PU and PEOU. In this study, trust is dened as the extent to which an individual believes that using m-commerce is secure and has no privacy threats. Since the impact of trust on IU an online technology is hard to be ignored in this study, the following hypothesis is developed: H5. Trust has a positive effect on consumer IU m-commerce in Malaysia. Methodology Sampling and data collection A survey instrument was developed for testing the hypothesis developed. In order to ensure the content validity of the scale used, it is advised to largely adapt the items for each construct from prior researches (Luarn and Lin, 2005). Hence, in this research, 23 survey items for six constructs in the questionnaire actually come from the prior empirical studies, and are modied to t the context of m-commerce. Table I shows the sources of where the questions were adapted from. The target population of this study are individuals who are mobile device users. The reason why these users were considered was due to the fact that they were
Constructs Intention to use Perceived usefulness Perceived ease-of-use Social inuence Number of items 4 5 3 5 3 Sources Davis (1989), Liao et al. (2007) and Kurnia et al. (2006) Taylor and Todd (1995), Khalifa and Cheng (2002), Wang and Barnes (2007), Kurnia et al. (2006) and Wong and Hiew (2005) Wang and Barnes (2007), Luarn and Lin (2005), Chew (2007) and Lin and Wang (2005) Luarn and Lin (2005), Lin and Wang (2005) and Wong and Hiew (2005) Davis (1989), Mallat et al. (2006), Liao et al. (2007) and Moon and Kim (2001)

Table I. Constructs and their sources

Perceived nancial cost

considered to be more likely to adopt m-commerce in the future than those without a mobile device. The surveys for this study were distributed at mobile phone service providers shops located in various shopping malls in Malaysia. The survey was given to every fourth customer who enters the shop. For users who did not want to ll in the form in the shop, e-mail addresses of these users were requested and the survey form was emailed to them. A total of 219 hardcopy surveys were distributed in the shops while another 45 softcopy surveys were sent via e-mail. Out of these 264 samples, 42 samples were rejected due to partial response and/or missing data, thus giving a total response rate of 84.09 per cent. As cited in Hinkin (1995), an ideal sample size should have an item-to-response ratios ranged from as low as 1:4 to as high as 1:10 for each set of scales to be factor analyzed. In this research, there were 23 items to be measured; hence sample size from 92 to 230 respondents would be sufcient for factor analysis. Variable measurement Independent variables The independent variables were based on factors derived from existing literatures. The questions were modied to t the context of m-commerce. For instance, the scales for consumer IU m-commerce were measured using the items adapted from the original TAM (Davis, 1989). A total of 19 questions were developed to capture the four adoption factors under investigation. Each question was measured by ve-point Likert scale. For instance, 1 denoted as strongly disagreed, 2 denoted as disagree, 3 denoted as neutral, 4 denoted as agree and 5 denoted as strongly agree. Statements that were negatively stated were reversed coded during the analysis, such as the items for perceived cost. These negative worded items are important in reducing the response bias since the respondents have to read the items carefully in case they are phrased the other way round (Field, 2005). Dependent variable: consumer IU m-commerce The measurements for consumer IU m-commerce were measured using items adapted from the original TAM (Davis, 1989). In this study, some of items for IU in the questionnaire were also consistent with that of Kurnia et al. (2006), Luarn and Lin (2005), Liao et al. (2007), Khalifa and Shen (2008) and Shin (2007). The consumer IU item was measured using ve-point Likert scale where 1 strongly disagree, 2 disagree, 3 neutral, 4 agree and 5 strongly agree. Four questions were used to capture the IU m-commerce by the mobile device users. The reliability coefcient for the scale was 0.83. Data analysis Prole of respondents The demographic prole of the surveyed respondents is presented in Table II, which includes gender, age group, marital status and highest level of academic qualication. The total sample for the survey consists of 222 respondents. The gender distribution of the survey respondents is 55.0 per cent males and 45.0 per cent females. The results also indicated that the samples have age predominantly between 21 and 25 years, which is 65.8 per cent. More than 80 per cent

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IMDS 109,3

Variables Gender Age Male Female # 20 years 21-25 years 26-30 years 31-35 years 36-40 years $ 41 years Single Married Under certication qualication Diploma/advanced diploma Degree/professional qualication Master degree

Frequency 122 100 11 146 49 11 2 3 199 23 20 31 145 26

Percentage 55.0 45.0 5.0 65.8 22.1 5.0 0.9 1.4 89.6 10.4 9.0 14.0 65.3 11.7

378
Marital status Highest level of academic qualication Table II. Demographic prole for respondents

of the respondents are single. Majority of the respondents have college or higher education level: 14.0 per cent are diploma or advanced diploma holder, 65.3 per cent have degree or professional qualication level and 11.7 per cent have postgraduate level of education. Only 9 per cent of respondents have attained high-school level. In this research, all the respondents have at least one mobile device. Most of them possess and use cell phone (95.5 per cent). The substitutions for cell phone are PDA and smart phone. Table III shows the services categories that are experienced by the respondents. Communication and entertainment services are the most popular services used by the survey respondents, which is coincident with earlier statement that communication services (e.g.: SMS, MMS) and entertainment application (e.g.: contest and downloads of icon, graphic and ringtone) contribute the most to the total mobile application revenue (Malaysian Communications and Multimedia Commission, 2004). The data also show that the number of Maxis subscribers is the highest in the sample with 59.9 per cent. About 27.9 per cent are Digi subscribers, 9.5 per cent are
Variables Mobile services Cell phone PDA Laptop Smartphone Postpaid Prepaid Digi Maxis Celcom Others Information services Entertainment Transaction services Location-based services Communication services Frequency 212 29 101 3 109 113 62 133 21 6 66 101 90 38 201 Percentage 95.5 13.1 45.5 14 49.1 50.9 27.9 59.9 9.5 2.7 29.7 45.5 40.5 17.1 90.5

Pricing scheme Subscribed telco

Mobile services Table III. Availability of mobile devices and services

Celcom subscribers and 2.7 per cent of the respondents are subscribers of other telcos. About 50.9 per cent of the respondents are using prepaid scheme while 49.1 per cent are on post-paid plan. Scale reliability and factor analysis The reliability of the questionnaire was tested using Cronbach a measurements. The reliability coefcients (a) of each independent variable are as follows: PU (0.905); PEOU (0.849); SI (0.798); perceived cost (0.887) and trust (0.909). The reliability coefcients of all the independent variables are above 0.70, which concurs with the suggestion made by Nunnally (1978). Construct validity measures the degree to which a scale measures what it intends to measure (Garver and Mentzer, 1999) and it is assessed by factor analysis in this research. In order to assess the construct validity, 19 items are examined by principal components extraction with varimax rotation. The Kaiser-Meyer-Olkin (KMO) has a measure of 0.825, which is above the threshold of 0.5 (Field, 2005). The Bartletts test is signicant in this study with x 2 2,621.292 ( p-value , 0.001). Therefore, the KMO value of 0.825 and signicance of Bartletts statistic conrm the appropriateness of the factor analysis for the data set. Tables IV and V show the factor loading for each item, and they are sorted by size. Any item that fails to meet the criteria of having a factor loading value of greater than 0.5 and loads on one and only one factor will be dropped from the study (Liao et al., 2007). Table V shows that 19 items are sorted and clustered into ve components: Factor 1 (PU), Factor 2 (SI), Factor 3 (trust), Factor 4 (perceived cost) and Factor 5 (PEOU). Table V shows that the dependent variable are clustered into 1 factor (consumer IU m-commerce). The eigenvalue for each factor is greater than 1.0 (3.591, 2.816, 2.701, 2.486, 2.427), which implies that each factor can explain more variance than a single variable. The cumulative percentage of variance explained by ve factors is 73.791 per cent. In other words, more than 70 per cent of the common variance shared by 19 items can be accounted or explained by these ve factors. Based on above results, the construct validity is established. Correlation analysis Since a single construct in the questionnaire was measured by multiple items, the average score of the multi-items for a construct was computed and used in further analysis such as correlation analysis and multiple regression analysis (Wang and Benbasat, 2007). Pearson correlation analysis was conducted to examine the relationship between the variables (Wong and Hiew, 2005; Jahangir and Begum, 2008). As cited in Wong and Hiew (2005) the correlation coefcient value (r) range from 0.10 to 0.29 is considered weak, from 0.30 to 0.49 is considered medium and from 0.50 to 1.0 is considered strong. However, according to Field (2005), correlation coefcient should not go beyond 0.8 to avoid multicollinearity. Since the highest correlation coefcient is 0.601 which is less than 0.8, there is no multicollinearity problem in this research (Table VI). All the associated pairs of variables were signicant at level 0.05, except for the relationship between perceived cost and other factor such as PU, PEOU, SI and trust. However, all the hypothesized relationships developed were found to be statistically

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380

IMDS 109,3

Variable 0.858 0.837 0.818 0.783 0.658 0.844 0.770 0.728 0.689 0.577 0.911 0.898 2.486 2.427 2.701 2.816 3.591

Perceived usefulness

Social inuence

Trust

Perceived nancial cost

Perceived ease-of-use

Note: Independent variables

Table IV. Factor analysis Scale items Factor loading Eigen values Percentage of variance 18.899 14.820 14.214 13.083 12.776 Using m-commerce would improve my efciency in my daily work Using m-commerce enables me to do my work conveniently Using m-commerce would enhance my effectiveness in my daily work Using m-commerce save my time In general, I believe m-commerce will be useful Friends suggestion and recommendation will affect my decision to use m-commerce Family members/relatives have inuence on my decision to use m-commerce I will use m-commerce if my colleagues use it Mass media (e.g. TV, newspaper, articles, radio) will inuence me to use m-commerce I will use m-commerce if the service is widely used by people in my community I believe payments made through m-commerce channel will be processed securely I believe transaction conducted through m-commerce will be secure I believe my personal information will be kept condential while using m-commerce technology The communication or access fee is expensive for me The subscription fee is expensive for me The cost of handset is high for me It is/might be easy o learn to use m-commerce m-Commerce is understandable and clear m-Commerce is/might be easy-to-use 0.840 0.936 0.928 0.836 0.859 0.791 0.745

Variable Scale items Intention Assume that I have access to use to m-commerce systems, I intent to use them

Factor Eigen loading values

Percentage of variance Sources Davis (1989), Bhattacherjee (2001), Mallat et al. (2006), Kurnia et al. (2006), Luarn and Lin (2005), Liao et al. (2007), Khalifa and Shen (2008), Moon and Kim (2001) and Shin (2007)

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0.811 I intend to use m-commerce if the cost is reasonable for me I believe I will use mobile commerce in the future I believe my interest towards m-commerce will increase in the future Note: Dependent variable 0.711 0.877 0.863

2.679

66.964

Table V. Factor analysis

Perceived usefulness Perceived usefulness Perceived ease-of-use Social inuence Perceived cost Trust Intention to use 1 0.601 * 0.372 * 2 0.041 * 0.364 * 0.645

Perceived ease-of-use 0.601 * 1 0.235 * 0.001 * 0.418 * 0.490 *

Social inuence 0.372 * 0.235 * 1 20.107 * 0.243 * 0.400 *

Perceived cost 2 0.041 * 0.001 * 2 0.107 * 1 0.034 * 2 0.174 *

Trust 0.364 * 0.418 * 0.243 * 0.034 * 1 0.499 *

Intention to use 0.645 * 0.490 * 0.400 * 0.499 * 1 Table VI. Pearson correlation coefcient

Note: *Correlation signicant at the level 0.001 (two-tailed)

signicance at level p , 0.01. In other words, PU (r 0.645, p , 0.001), PEOU (r 0.490, p , 0.01), SI (r 0.400, p , 0.001) and trust (r 0.499, p , 0.01) were correlated to consumer IU m-commerce signicantly and positively while perceived cost (r 2 0.174, p , 0.01) was correlated to consumer IU m-commerce negatively. Based on Table IV, the correlation between PU and intention was the strongest (R-value 0.645, p , 0.01. This is followed by the relationship between PEOU and PU (r 0.601, p , 0.01). Multiple regression analysis Multiple regression analysis was employed to test the hypotheses. Multiple regression analysis is applied to analyze the relationship between a single dependent variable and several independent variables (Hair et al., 2005). Multiple regression analysis was therefore selected as it is viewed as an appropriate method for this study. The summary of results analysis is shown in Table VII.

IMDS 109,3

382

In order to test for multicollinearity among the predictor variables, variance-ination factor (VIF) and tolerance were applied. The multicollinearity statistics showed that the tolerance indicator for PU, PEOU, SI and perceived cost and trust are all greater than 0.1, and their VIF values are less than 10. The result indicates that no multicollinearity problem has occurred (Neter et al., 1996; Ott and Longnecker, 2001). The F-statistics produced (F 50.892) was signicant at 1 per cent level (Sig. F , 0.1), thus conrming the tness for the model. Therefore, there is a statistically signicant relationship between the adoption factors and the consumer IU m-commerce. The coefcient of determination R 2 was 54.1 per cent. Thus, the adoption factors can signicantly account for 54.1 per cent in the consumer IU m-commerce. The results shows that PU ( p , 0.001), SI ( p 0.008), perceived cost ( p 0.0001) and trust ( p , 0.001) all signicantly affect the intention of use of m-commerce of users. Based on Table V, it indicated that the most important adoption factors that affect the consumer IU m-commerce are PU and trust, followed by perceived cost and SI. PEOU however, was found not to be signicantly associated with consumer IU m-commerce. Discussion PU was found to be the most signicant determinant to predict consumer IU m-commerce in Malaysia. This result is expected and supports prior researches that extended TAM in the context of m-commerce (Luarn and Lin, 2005; Lin and Wang, 2005; Lu et al., 2003; Khalifa and Shen, 2008) and e-commerce (Guriting and Ndubisi, 2006; Jahangir and Begum, 2008). These studies have indicated that PU played a vital role in inuence the behavioral intention of adopting a technology. Consumer IU m-commerce will only increase when they nd it useful. This is because m-commerce has unique characteristics such as ubiquity and immediacy, which users can retrieve information immediately and conduct the transaction anytime and anywhere. In conclusion, the better m-commerce could support them, the more useful they perceive m-commerce to be and increase their IU it. Hence, service providers and vendors attention should focus on designing the reliable system that will meet the users needs, as well as providing the useful and quality information to users. PEOU was found to have an insignicant effect on consumer IU m-commerce. This result contradicted the prior studies (Luarn and Lin, 2005; Lin and Wang, 2005; Mallat et al., 2006; Guriting and Ndubisi, 2006; Jahangir and Begum, 2008). However, it is consistent with Cho et al.s (2007) nding, which suggested that there is no

Predictor variables Perceived usefulness Perceived ease-of-use Social inuence Perceived cost Trust

b
0.441 0.007 0.134 20.151 0.279

t-value 7.253 1.280 2.667 23.244 5.372

Sig. 0.000 0.202 0.008 0.001 0.000

Tolerance 0.575 0.593 0.838 0.984 0.790

VIF 1.740 1.687 1.193 1.016 1.266

Table VII. Multiple regression analysis

Notes: Overall model F 50.892; p , 0.01; R 2 0.541; adjusted R 2 0.530

signicant impact of PEOU on the IU m-commerce. It is surprising that PEOU was found to be not signicant in inuencing the adoption of m-commerce in the study, even though PEOU has been validated as major behavioral belief to inuence users intention to adopt in various technologies in both origin and the extended TAM models. It can be inferred that since majority of the mobile device users in the study are younger (between ages of 20 and 30), it is possible that m-commerce can be learned easily by them and thus the ease-of-use has not impact on whether they will use m-commerce or not. Since youth are more aware of new innovation, they may have experienced various technologies and therefore have a good foundation of knowledge on how to use the technology. Thus, the ease-of-use or difculty level of using m-commerce would not inuence their decision to use them. SI exhibited a signicant correlation on IU m-commerce. The nding provides evidence to support prior studies (Shin, 2007; Khalifa and Cheng, 2002; Kurnia et al., 2006), which suggested the importance of SI in predicting the adoption of m-commerce. As mobile device users in this study are mostly between the age of 21 and 30, they are considered to be in the lead segment (Wong and Hiew, 2005) and are easily vulnerable to SI (Lu et al., 2003). As stated earlier, they are more sensitive to the new trends and normally involved in rapid shift of trends and styles (Shin, 2007). Inuence that comes from mass media or peers may easily inuence their decision to use m-commerce. Hence, it is important for the services providers and vendors to consider the SI factor to encourage the adoption of m-commerce in Malaysia. Perceived cost is one of the barriers that prevent Malaysian from using m-commerce. The results in the study are consistent with prior researches (Luarn and Lin, 2005; Lin and Wang, 2005; Wong and Hiew, 2005), which have identied the negative relationship between the nancial cost of using m-commerce and the consumer IU m-commerce. The results show that increasing in the cost such as cost of handset, subscription fee and communication fee will result in the decrease in adoption rate of m-commerce. Therefore, most of the respondents intend to use m-commerce if the cost of m-commerce is reasonable for them. The perceived cost can be reduced through the creative promotional and pricing strategies. Trust factor was found to be important predictor to explain the adoption of m-commerce in many existing technology adoption studies (Luarn and Lin, 2005; Cho et al., 2007; Lin and Wang, 2005). The nding in this study supports these existing ndings and showed that there is a strong positive relationship between trust and the consumer IU m-commerce. m-Commerce is still a relatively immature technology and is still at the early stage in Malaysia; therefore, trust is very important to motivate Malaysian users to use the services provided by m-commerce in such uncertain environment. In order to increase the usage rate of m-commerce in Malaysia, the service providers and vendors should concentrate on building trust by developing m-commerce system with valuable function to assure the security and privacy of the users. Implication According to Muthaiyah (2004), it costs tens of billions to build and develop the required m-commerce infrastructures in Malaysia. Since lots of efforts and money have been invested in m-commerce system, it is essential to ensure that people are using them.

Malaysian m-commerce

383

IMDS 109,3

384

In order to attract more users and encourage the use of m-commerce in Malaysia, it is believed that merely introducing m-commerce to Malaysian may not be sufcient. By using the derived results in the analysis, the service providers and vendors may focus on the improvement of constructs or attributes that have positive impact on IU (Wong and Hiew, 2005). Since the PU is the most critical factor among all independent variables, the service providers should develop the content and applications which users will nd valuable and usable to keep up with their fast-paced life style. Design of the services and contents should be focused on the important and unique characteristics of m-commerce, such as ubiquity, personalization and so on. Besides, the usefulness of m-commerce, the ndings also reect the overwhelming importance of trust in m-commerce. This implies that trust building between the customers and vendors should be another major concern for the service providers while improving the usefulness of the system. Without proper security and privacy protection, users will not use the services provided by m-commerce. According to Wang and Barnes (2007), the trust building strategies include advertising campaign, privacy guarantees, company policies and statement and so on. Furthermore, the strong relationship between perceived cost and m-commerce adoption in the study suggests that the creative promotional and pricing strategies, including cost reduction should be implemented to attract price-conscious customers. The SI should be taken into account to encourage the adoption of m-commerce in Malaysia too. For instance, the service providers should attract customers via various social networks and channels, such as word of mouth and informal seminars (Lu et al., 2003). On the other hand, the PEOU is found to be insufcient to inuence the consumer IU m-commerce in the study. Hence, the main attention of management should be focused on development of usefulness of the system, trust building and cost reduction, instead of focusing on making system easy-to-use or interact with. Besides, the above implications for practices, this study provides several implications for scholars too. This study successfully extend the TAM in the context of m-commerce by incorporating one trust-based construct (trust), one behavioral control construct (perceived cost) and one subjective norm construct (SI). This extended TAM model is developed to achieve the greater understanding of user acceptance of m-commerce in Malaysia while remaining the parsimony of the model in the same time. In conclusion, the model in this study presents a considerable improvement in explanatory power. Limitation and future studies This research was conducted in Malaysia and whether the results from this research would be consistent with other countries mobile users would need to be veried through further research. Future studies can focus on conducting a multi-country comparison to test the inuence of moderating factors such as the national culture from the countries. The future research should follow the longitudinal approach to predict beliefs and behaviour over time since the model is this study is cross-sectional, which measures the intention only at a single point in time (snapshot approach) (Luarn and Lin, 2005). This study has demographic proles of relatively young age (Table II). Thus, it is possible that results taken from a different age group might have different result.

For example, respondents from the older age group might nd it more difcult to use m-commerce thus ease-of-use might be a factor inuencing the adoption m-commerce. It would therefore be useful to make a comparison study between users from different age group in future study. The result from this study could be due to the services provided by the mobile service providers. For example, one service provider might offer more service than the other. Therefore, future study can also do a comparative study to investigate if there are any differences in the adoption of m-commerce between these different mobile service providers. As perceived cost is found to be a factor inuencing the adoption of m-commerce, it would be interesting to do a comparison of the prices offered by these different mobile service providers and see if the providers with lower m-commerce service fees will actually have a higher adoption rate. Research challenges in security for new generation mobile net works are limitless with the speedier growth and development of m-commerce. As with many adoption model, there is a risk that additional signicant factors have not been included in this model. New construct such as self efcacy (Luarn and Lin, 2005; Lin and Wang, 2005; Khalifa and Shen, 2008; Guriting and Ndubisi, 2006), perceived enjoyment (Liao et al., 2007; Shin, 2007) and compatibility (Mallat et al., 2006) which have been validated in numerous prior studies could be considered in the future research.
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