Developing and maintaining clients’ trust through institutional mechanisms in online service markets for digital entrepreneurs: A process model

Crowdsourcing intermediaries, such as Upwork and ZBJ, are powering a new force of digital entrepreneurs by creating online service markets where service providers seek contracts from clients all over the world. An important reason for this flourishing digital entrepreneurship is that the intermediaries establish institutional mechanisms (IMs) that develop clients’ trust in digital entrepreneurs. However, insights into how intermediaries achieve it remain limited. Although the e-Commerce literature has generated rich findings on intermediary-based trust development, its findings are based on online product markets and thus may not be readily applicable to online service markets. More specifically, these findings are mainly focused on various IMs that facilitate initial trust formation based on variance models. However, a successful service transaction requires not only the initial trust but further development and maintenance of that trust, because it is a cooperative process between clients and vendors. By conducting an in-depth case study of ZBJ, the largest crowdsourcing intermediary in China, this study develops a three-phase process model, whereby the intermediary deploys different sets of IMs that initiate, augment, and maintain clients’ trust in vendors. Our findings make important theoretical contributions to the literature on digital entrepreneurship, crowdsourcing, and e-Commerce trust development.