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The impact of information security failure on customer behaviors: A study on a large-scale hacking incident on the internet

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Abstract

This research examines the responses of online customers to a publicized information security incident and develops a model of retreative behaviors triggered by such a security incident. The model is empirically tested using survey data from 192 users of a recently compromised website. The results of the data analyses suggest that an information security incident can cause a measurable negative impact on customer behaviors, although the impact seems to be largely limited to that particular website. The tested model of retreative behaviors indicates that perceived damage and availability of alternative shopping sources can significantly increase retreative behaviors of victimized customers, while perceived relative usefulness and ease-of-use of the website show limited effects in reducing such behaviors.

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Notes

  1. www.auction.co.kr: A subsidiary of e-bay since 2001. For more information about major Internet shopping sites in Korean, refer to http://www.redherring.com/Home/17139

  2. http://member.auction.co.kr/announce/view.aspx?no=2184 (Korean)

  3. http://news.jknews.co.kr/article/news/20080418/5515114.htm(Korean), http://world.kbs.co.kr/english/culturenlife/culturenlife_hotclick_detail.htm?No=76 (English)

  4. In this paper, an alternative vendor can be any online or offline store where an Auction customer can acquire an equivalent level of services/products. This is different from an alternative decision option (e.g., decision to do nothing, stay with Auction but provide false info, switch to another online vendor, go offline)

  5. The sum of all outcome probabilities in a decision option may not be one. Refer to Tversky and Kahneman (1992) for more details about assumptions and model specifications in different decision theories.

  6. www.auction.co.kr

  7. www.gmarket.com

  8. www.interpark.com

  9. Portal (Naver), social network (CyWorld), shopping mall (Auction, GMarket, InterPark), webmail (Gmail, Hotmail) sites

  10. Odd vs. even number cases when the entire responses from Auction members are listed in the response order.

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Authors and Affiliations

  1. College of Politics & Economics, Department of Int’l Business and Trade, Kyung Hee University, Seoul, Korea

    MinJae Lee

  2. MSIS, Spears School of Business, Oklahoma State University, 317 NH, 700 N Greenwood Ave., OSU-Tulsa, Tulsa, OK, 74106, USA

    JinKyu Lee

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  1. MinJae Lee
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Lee, M., Lee, J. The impact of information security failure on customer behaviors: A study on a large-scale hacking incident on the internet. Inf Syst Front 14, 375–393 (2012). https://doi.org/10.1007/s10796-010-9253-1

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