Psychological distance and culture: How an unfamiliar e-Retailer can offset uncertainty

Unfamiliar e-retailers often face stiff challenges to reduce the sense of distrust or increase the stickiness of their website with buyers during the initial en-counters. Literature suggests that trust and purchase intentions can be im-proved by reducing the psychological distance between the buyer and seller. Moreover, reducing the social psychological distance (i.e., degree of personal closeness or connection) is crucial to create an illusion of social closeness or connection with buyers. Nevertheless, how unfamiliar e-retailers can use deci-sion-facilitative tools (interactivity and personalization) to create a better sense of social closeness during the first encounter with potential buyers is less explored. In addition, how such an interaction is influenced by the cultural ori-entations of buyers is often ignored. This study addresses such issues using two experiments. The results show that these tools can reduce buyers’ perceptions of social distance and increase their purchase intentions. However, the influ-ence of interactivity is greater for buyers with high uncertainty avoidance and power distance cultural orientations, whereas personalization is more impact-ful for buyers from low uncertainty avoidance and power distance cultures. The study offers a unique segmentation tool to managers based on culture and buyers’ information use behaviour.