Online Store Perception:: How To Turn Browsers Into Buyers?
Online Store Perception:: How To Turn Browsers Into Buyers?
ONLINE STORE
PERCEPTION:
HOW TO TURN BROWSERS INTO BUYERS?
Contents
Abstract.................................................................................................................................................3
Introduction with special reference to Indian context............................................................................3
Literature Review..................................................................................................................................5
Research questions & Hypothesis..........................................................................................................8
Methodology.......................................................................................................................................11
Analysis...............................................................................................................................................14
Findings...............................................................................................................................................19
Discussion And Managerial Implications............................................................................................22
Summary with special reference to similarities & dissimilarities with the previous research..............19
Limitations..........................................................................................................................................19
Scope for further research....................................................................................................................19
Bibliography........................................................................................................................................20
3
ABSTRACT:
The purpose of this study is to analyze the impact of consumer perceptions in regards to
online shopping. The study broadly classifies net users into two categories browsers and
online shoppers across various age groups, income categories, education qualification and
job profile. A sample of 100 (63 males and 37 females) respondents were taken into
consideration from New Delhi. ANOVA statistical techniques was applied to know the
significant difference in overall online shopping perception, vendor characteristics, website
characteristics, consumer characteristics due to users(browsers & buyers) and demographic
characteristics such as age, gender, monthly family income , education and occupation . It
was found that there was significant difference on shopping perception due to users (buyers
& browsers), age and education. In order to strengthen the analysis of further research large
sample size to be considered.
1.0 INTRODUCTION:
It has been more than a decade since business-to-consumer E-commerce first evolved. Today
it forms the bedrock of most businesses banking, travel and entertainment, shopping and e-
mailing now all form part of a new mode in which the society interacts. Scholars and
practitioners of electronic commerce constantly strive to gain an improved insight into
consumer behaviour in cyberspace. Along with the development of E-retailing, researchers
continue to explain E-consumers behaviour from different perspectives. The growing use of
Internet provides a developing prospect for E-marketers. If E-marketers able to establish
relationship between factors affecting online buying behaviour and the perceptions of online
buyers, then they can further develop their marketing strategies to convert potential browsers
into buyers. The study investigates the behaviour and perception of browsers that holds them
from shopping online.
Undoubtedly the numbers of internet users have significantly increased thanks to factors like
greater internet penetration, fall in prices of hardware, fall in the price of internet
communication, development of better and more reliable technologies, and increased
awareness among user are few of the prominent factors leading the change. The potential and
size of Indian markets is huge in terms of revenues and customer base therefore many
4
businesses are gearing up for the new model that provides goods and service at the doorstep
of the e-customer at the click of a mouse button. The business model promises excellent
service quality, low price, and big range of choices, availability, convenience, and
comprehensive information about products. The question arises whether the Indian business
and consumers have matured to move up the IT curve and consider B2C (Business to
Consumers) a viable model. Its seems like a territory largely untouched and underutilized,
except in the travel and ticketing sector Online Shopping in India has few takers. Though it
has always been touted as the next big thing ever to happen, Indians have been quite sceptical
about its services and growth factors. Largely the reason seems to be the lack of well
designed and maintained websites and websites failing to address the concerns of customers
and long time association with brick and mortar stores.
According to the joint report published by the Internet & Mobile Association of India
(IAMAI) and IMRB International, the number of internet users in India reached forty six
millions in September 2007, a rise of 40% over September 2006. Out of them, the numbers of
active internet users were 32 million and maximum users were in the age bracket of 18-24
years. Active internet users were defined as those who have accessed the internet at least once
a month. The number of online shoppers too is growing rapidly. The same IAMAI report puts
the total online transactions at Rs. 7,080 crores (approx $1.75 billion) for the year 2006-
07.The report also points out rising trend of internet shopping in metropolitans such as Delhi
and Mumbai where both consumers and merchants have become equally net-savvy. Not only
had the metropolitans that have witnessed an increase in the population of online shopper’s
small cities also witnessed an increase in online shopping activities. The rise in online
shopping is not just for consumer markets, the government is another user of the online
buying. A series of initiatives from the
Government, public sector banks and Indian Railways have helped boost the confidence of
users to trade online. Online spending is largely towards travel ecommerce side. Out of
Rs.7000 crores out of the total Rs.9210 is expected to be spent on online purchase related to
air tickets/railways / bus etc.
The purpose of the case study is to understand the perception of consumers towards online
shopping. A sample size of 100 respondents has been taken into consideration across various
age groups, income categories and education in order to arrive at concrete conclusion. A
5
questionnaire has been designed that rates consumer perceptions on Likert’s scale and
provides a roadmap for businesses in order to provide better online product and services.
1.) Attitudes, Preferences and Profile of Online Buyers in India: Changing Trends.
(By: Ravi Kiran, Anupam Sharma and K C Mittal, 2008) conducted a study that
focuses on factors affecting the online buyer’s behaviour and also investigates how
online advertisements influence consumers to buy online. The paper focuses on the
current scenario of internet use and attitude towards e-buying. The findings of the
study were most respondents use web for work/business purposes and to
communicate, people around the age of 20 years use net for entertainment. Speed and
cost were biggest problems and people within the age group of 31-35 years
considered junk sites as major problem.
4.) Website characteristics, Trust and purchase intention in online stores: - An Empirical
study in the Indian context.
(By: Boudhayan Ganguly, Satya Bhusan Dash, and Dianne Cyr, 2009)The purpose of
the research was to study impact of the website characteristics on trust in online
transactions in Indian context. During the course of study various website
6
characteristics like Website Navigation Design, Website Visual Design, and Website
enabled Communication, Website Privacy etc were analyzed and research concluded
that trust was one of the key obstacles for online transactions. In order to come up with
a successful e-business online stores need to have a deeper understanding on how trust
is developed and how it affects purchase intention in the online store.
the basis of their demographic characteristics and their experience with the internet
for general surfing and specifically for shopping. The key findings of the research
were demographic characteristics play a role in the success of Internet shopping and
positive image would result in a repeat purchase of internet shopping.
8.) Comparing the effects of website quality on customer initial purchase and continued
purchase at e-commerce website.
(By: Kuan, Huei-Huang; Bock, Gee-Woo; Vathanophas, Vichita.2008) The research
deals with impact and implications of website quality on purchasing behaviour of the
consumer, and compares the impact of website quality on initial purchase and
continued purchase with the website. Research also suggests a model for customer
retention and conversion rate. The key findings were if website quality beliefs are
positive than customers would continue to make purchases on website.
9.) Consumer attitude towards online retail shopping in the Indian context.
(By: Sangeeta Sahney, Archana Shrivastava and Rajani Bhimalingam, 2009) The
study was conducted to identify and measure the aspects of modern day online
shopping format. It gives inputs about creating a conducive shopping environment.
The study recognizes factors that affect the development of attitudes towards online
shopping and customer requirements with respect to online shopping. This study is
descriptive, diagnostic and exploratory in nature, and is aimed at identifying critical
parameters in online retail shopping, tapping consumers’ feelings and attitudes
towards online shopping, and establishing attitudinal differences across
demographics.
Previous research (Ravi Kiran, Anupam Sharma and K C Mittal, 2008, Ch. J.S. Prasad, A.R.
Aryasri 2009, Ganguly, Satya Bhushanand and Dianne cyr, Kaun, Huei-Huang; Bock. Gee-
Woo; Vanthanopas, Vichita 2008) suggest trust, convenience, customer service, price,
website characteristics and past experiences are major drivers of consumer perception
towards online shopping.
H1: There is no significant difference in overall online shopping perception due to users
(browsers & buyers)
H2: There is no significant difference in overall online shopping perception due to Gender
H3: There is no significant difference in overall online shopping perception due to Monthly
Family Income
H4: There is no significant difference in overall online shopping perception due to Age
H5: There is no significant difference in overall online shopping perception due to Education
Vendor Characteristics:
9
Prior studies (Boudhayan Ganguly, Satya Bhushanand and Dianne cyr, 2009, Ch J. S. Prasad,
A.R. Aryasri 2009) suggest that privacy and security of information largely influence
consumer’s perception towards online shopping. Others research (Ravi Kiran, Anupam
Sharma and K C Mittal, 2008) emphasise on the importance of customer service. Overall it is
hypothesized that:
H7: There is no significant difference in vendor characteristics due to users (browsers &
buyers)
H9: There is no significant difference in vendor characteristics due to monthly family income
Website Characteristics
H13: There is no significant difference in website characteristics due to users (browsers &
buyers)
Consumer characteristics
10
Personal characteristics of consumer may also affect their choice of online shopping medium
(Sheth 1983).Consumers who value social interaction while shopping may not utilize internet
for the same(Alba, Weitz and Janiszewski). On the other hand those who value convenience
and time saving tend to shop online while being less price conscious (Swainathan,
Lepkowska-white and Bharat 2003). Taking all these studies into consideration it is
hypothesized that:
H19: There is no significant difference in consumer characteristics due to users (browsers &
buyers)
Product/Service Characteristics:
Consumers are likely to shop online if their expectations regarding product quality, selection
at affordable prices are fulfilled (Farm and gray 1996, Alba et al 1997, Spiller and Lohse
1998).Prior studies (Pingium Jiang, 2003) demonstrates the effect of service quality on price
perception of consumers. Thus we hypothesize as
A questionnaire was developed to study the online store perceptions of browsers. The questionnaire
includes the demographic profile and attitude towards online shopping. The questionnaire is based on
a five-point Likert's scale, where 1=Strongly Disagree, 2=Disagree, 3=Neither Agree nor Disagree,
4=Agree, 5=Strongly Agree. The respondents were asked to rate the options according to their
choices. Respondents who were not familiar with online shopping were not included in the survey.
Random sampling technique has been used for collecting the data. Data has been collected from
students, self employed, service class and others across various age groups, income categories and
professional qualification. A total of 120 questionnaires were distributed from which 100
questionnaires were considered because rests were either misleading or incomplete.
First, responses were analyzed using ONEWAY ANOVA that tested mean differences on dependant
variables such as Overall Perception, Vendor characteristics, Website characteristics, Customer
characteristics and Product/Service characteristics across Users profile such as browsers and buyers
and demographic characteristics such as Gender, Monthly family income, Age, Education and
Occupation.
Demographic Characteristics
37% 13%
Male
Female 19% 45% Never
63% Once
Twice
Thrice or more
23%
15% 13%
5% 7%
10%
ONE-WAY ANOVA
education
H24 There is no significant difference in consumer characteristics due to .634
occupation
H25 There is no significant difference in product/service characteristics due to .000*
age users(browsers & buyers)
H26 There is no significant difference in product/service characteristics due to .907
gender
H27 There is no significant difference in product/service characteristics due to .625
monthly family income
H28 There is no significant difference in product/service characteristics due to .000*
age
H29 There is no significant difference in product/service characteristics due to .111
education
H30 There is no significant difference in product/service characteristics due to .149
occupation
Note: * - Statistically Significant at .01
** - Statistically Significant at .05
6.0 Findings:
We analyse the effect of users profile and demographic characteristics such as Age, Gender,
Monthly Family Income, Education and Occupation on Overall Online Shopping Perception,
Vendor Characteristics, Website Characteristics, Consumer Characteristics and
Product/Service Characteristics. We use one way ANOVA to find out the implications.
16
For hypothesis stated under Overall Online Shopping Perception we found that the significant
F test value for user, age and education was .000, .000, .022 respectively. Since all the values
are lower than 0.05 at 95% confidence level, thus there is significance difference.
Interestingly significant F test for gender, monthly family income and occupation was .663, .
723, .212 respectively. Since all the values are greater than 0.05 at 95% confidence level,
hence it could be conclude that there is no significance difference. Detailed results are given
in Table 7.
In case of vendor characteristics F test value for users, age education was .000, .024, .004
respectively. Since all the values are lower than 0.05 at 95% confidence level, thus there is
significance difference. For gender, monthly income and occupation F test value was .981, .
576, .725 respectively. Since all the values are greater than 0.05 at 95% confidence level,
hence it could be conclude that there is no significant difference. Detailed results are given in
Table 8.
For website characteristics F test value for users, age education was .000, .000, .035
respectively. Since all the values are lower than 0.05 at 95% confidence level, thus there is
significance difference. For gender, monthly income and occupation F test value was .482, .
832, .115 respectively. Since all the values are greater than 0.05 at 95% confidence level,
hence it could be conclude that there is no significant difference. Detailed results are given in
Table 9.
In case of consumer characteristics F test value for users, age was .000, .005 respectively.
Since all the values are lower than 0.05 at 95% confidence level, thus there is significance
difference. For gender, monthly family income, occupation and interestingly for education F
test value was .590, .470, .634, .077 respectively. Since all the values are greater than 0.05 at
95% confidence level, hence it could be conclude that there is no significant difference.
Detailed results are given in Table 10.
In case of product/service characteristics F test value for users, age was .000, .000,
respectively. Since all the values are lower than 0.05 at 95% confidence level, thus there is
significance difference. For gender, monthly family income, occupation and interestingly for
education F test value was .907, .625, .149, .111 respectively. Since all the values are greater
17
than 0.05 at 95% confidence level, hence it could be conclude that there is no significant
difference. Detailed results are given in Table 11.
Table 7: Result of effect of users (browsers & buyers), age, gender, monthly family
income and occupation on Overall Online Shopping Perception
Users (.000)
Age (.000)
Education (.022)
Occupation (.216)
Table 8: Result of effect of users (browsers & buyers), age, gender, monthly family
income and occupation on Vendor characteristics
Users (.000)
Age (.024)
Gender (.981)
Vendor Characteristics
Monthly Family Income (.576)
Education (.004)
Occupation (.725)
Table 9: Result of effect of users (browsers & buyers), age, gender, monthly family
income and occupation on website characteristics
Users (.000)
Age (.000)
Education (.035)
Occupation (.115)
Table 10: Result of effect of users (browsers & buyers), age, gender, monthly family
income and occupation on consumer characteristics
Users (.000)
Age (.005)
Education (.077)
Occupation (.149)
Table 11: Result of effect of users (browsers & buyers), age, gender, monthly family
income and occupation on product/service characteristics
Gender (.907)
Education (.111)
Occupation (.149)
Similarity: Both the research concludes that there was a significant difference in perception
of users (browsers & buyers) towards online shopping.
20
Dissimilarity: Unlike previous research done by Elzbieta Lepkowska-White, 2004 the study
done also consider the effect of demographic characteristics such as income, education and
occupation on dependent factors to have magnified view.
9.0 Limitations:
A few limitations were identified in the course of the study. The limitations provide scope of
improvement in future research works. The following are the set of limitations identified:
1.) The sample taken into consideration was small and this could generalize the findings
in terms of consumer behaviour and attitude towards online shopping. A large sample
size would have certainly given clearer picture.
2.) Limited factors were used in the present study. This creates an opportunity for future
3.) The data is geographically skewed i.e. sample was taken mainly from New Delhi
region.
4.) Many respondents who buy airline and railway ticket form most part of the sample
which could mislead the results and findings.
First and foremost in order to have magnified view, the further research can include large
sample size and targeting different geographic location.
Acc to shopping preference theory, factors such as consumer social values i.e. values
influenced by family and friends can also be taken into consideration.
11.0 BIBLIOGRAPHY:
Alba, J., Lynch, J, Weitz, B., Janiszewski, C, Lutz, R., Sawyer, S., &Wood, S. (1997),
"Interactive Home Shopping: Consumer, Retailer, and Manufacturer Incentives to
Participate in Electronic Marketplaces," Joumal of Marketing. 61, 38-65.
Ganguly, B; Dash, S. B; Cyr, D, (2009) .Website characteristics, Trust and purchase
intention in online stores: - An Empirical study in the Indian context, Journal of
Information Science & Technology, 6, 22-44.
21
Handa, M.; Gupta, N, (2009). Gender influence on the innovativeness of young urban
Indian online shoppers, Vision, 13, 25-32. f Online Buyers in India: Changing Trends.
South Asian Journal of Management, 15,
Kiran, R; Sharma, A; Mittal, K. C. (2008). Attitudes, Preferences and Profile o 55-73.
Kuan, H; Bock, Gee-Woo; Vathanophas, V, (2008). Comparing the effects of website
quality on customer initial purchase and continued purchase at e-commerce website,
Behaviour & Information Technology,27, 3-16.
Parikh, D, (2006). Profiling Internet Shoppers: A study of Expected Adoption of
Online Shopping in India, IIMB Management Review, 18, 221-231.
Pingjun J, (2003). Managing Customer Price Perceptions: An Empirical Investigation
on the Impacts of E-Tailing Services, Services Marketing Quarterly, 24, 77-98.
Prasad, Ch. J. S.; Aryasri, A. R. (2009). Determinants of Shopper Behaviour in E-
tailing: An Empirical Analysis. Paradigm, 13, 73-83.
Rajan, M; Gehrt, Ken; G., Shainesh; O'Brien, Matt; Therese, (2009). The Emergence
of Internet Shopping in India: Identification of Shopping Orientation-Defined
Segments Advances in Consumer Research, Asia-Pacific Conference Proceedings,
8,366-367.
Rishi, B.J, (2008). An Empirical Study of Online Shopping Behavior: A Factor
Analysis Approach, Journal of Marketing & Communication, 3, 40-49.
Sahney, S; Shrivastava, A; Bhimalingam, R, (2008). Consumer attitude towards
online retail shopping in the Indian context, ICFAI Journal of Consumer Behaviour,
34-68.
Sheth, J. N. (1983). An Integrative Theory of Patronage and Behaviour" in Patronage
Behaviour and Retail Management, Elsevier Science Publishing, 9-28
Swaminathan V, Elzbieta L.W, Bharat P. Rao (2003).The Internet and Consumer
Buying Behaviour: A Research Framework and Analysis in Current Topics in E-
Commerce, 64-84.
Weblography: www.iamai.in.
22