‘To Trust or Not’: Impact of camouflage strategies on trust in the sharing economy

• Published in: Journal of business research Vol. 136; pp. 110 - 126
• Main Authors: Venkateswaran, Viswanathan, S Kumar, Deepak, Gupta, Deepak
• Format: Journal Article
• Language: English
• Published: Elsevier Inc 01-11-2021
• Subjects: Camouflage; Concealment; Neutralize; Organizational Response Strategies; Sharing Economy; Trust; Organizational Response Strategies; Concealment; Neutralize; Sharing Economy; Camouflage; Trust
• ISSN: 0148-2963; 1873-7978
• DOI: 10.1016/j.jbusres.2021.07.023

•Sharing economy firms face a complex regulatory environment.•They are tempted to explore alternate strategies that can vitiate stakeholder trust.•We propose and validate a new camouflage strategic alternative – Neutralize.•This offers a short-term upside for trust with a limited downside when detected.•Study makes salient contribution to strategy, sharing economy and trust literature.
Sharing economy businesses consider trust as core to their success. However, numerous reports indicate that these organizations are susceptible to malpractices and may adopt alternate deviant strategies such as camouflage. Based on the theoretical perspectives of interpersonal deception theory, stakeholder principle, and transparency theory, this study proposes and validates 'neutralize’ as a new type of camouflage strategy. We compare neutralize strategy with concealment, an adjacent camouflage strategy type, and study their respective impacts on organizational trustworthiness and trust. Our findings indicate that neutralize strategy offers a significant short-term upside potential along with a lower downside when detected. This result contrasts with concealment strategy, which brings no appreciable gain but carries significant downside risk if detected. From a trust perspective, this makes neutralize a dominant strategic choice for organizations. This research makes salient contributions by integrating three distinct literature streams related to organization response strategies, trust dynamics, and the sharing economy.