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Proposal Final[1]

Proposal Final[1]

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Published by: happyluck on Sep 29, 2009
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06/20/2010

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A Study of Consumer Buying Behavior and Market Approachtowards Online Retail Business in Faisalabad
Introduction
The Internet and the World Wide Web have become the most important newcommunication media since television, and ones that are fundamentally reshapingcontemporary understanding of sales and marketing. Another strong signal that theInternet is becoming more entrenched in daily life is the increase in time spentonline(Lipsey, 2007).Marketing on the Internet for the foreseeable future will remain principally about gettingthe right information to the customer, at the right time, and in just the form that willenable the customer to move one step further along in the purchase consideration process(Clarke, 2005).
Literature Review
The emergence of the Internet, Web and related technologies has allowed businesses totransmit and receive data in an inexpensive, simple and easy manner(Clarke, 2005).Aside from supplying needed information, companies can also market and sell productsand services more easily. At the same time, electronic commerce carries an underlying promise of being a great equalizer exposing small enterprises to a number of novel andcost-effective ways to promote their goods and services on a global level(Gao, 2004).Organizations currently using the Internet for their marketing activities, collaboration,and competitor research are already using e-commerce tools. After the initial pioneeringexperience most are now interested in reassessing their Internet, Extranet, and Webstrategy as an integral part of their electronic commerce activities(Reynolds et al., 2004 ).1
 
The prospect of a seamless, interconnected global marketplace of goods and services isstimulating unprecedented interest in the business community as well as among variousnational governments(Lipsey, 2007).
Consumer Trust in Internet Retailer 
Trust can be defined in the Internet store as a consumer’s willingness to rely on the seller and take action in circumstances where such action makes the consumer vulnerable to theseller. The definition emphasizes the cognitive dimensions of trust and views trust as arationale choice process(Castaldo, 2007 ). The cognitive view is a narrow treatment of trust excluding the affective and social dimensions and research proposed a model of antecedents of organizational trust based on a dyad of trustor and trustee.(De Mooij,2003) The antecedent of trusting behavior is, trusting intention, or the willingness to bedependent on another person. Trusting intention is in turn influenced by a trustor’s propensity to trust, the trustor’s perceived characteristics of a trustee (e.g., trustworthinessof trustee based on his or her integrity, benevolence, and ability), and indirectly thetrustor’s observations of the trustee’s behavior(Castaldo, 2007)
Security and Data Privacy
It is important to realize that until the problem of transaction security is completelysolved and solid, companies and consumers will be uneasy about performing financial or other confidential transactions on-line and reluctant to use the Internet and publicnetworks for conducting business. Business transactions must be completely reliable andsecure(Khosrow-Pour, 2006).One of the interesting phenomena of the digital age is the fact that data is quickly becoming the only asset and needs to be well protected. Therefore, it would beshortsighted not to build security into the core of electronic commerce(Psaila, 2008).Finally, both user and provider must consider the problem of confirming that the other  person is who he or she claims to be. Just as a cyberspace retailer wants to confirm that persons ordering a product or service are who they claim to be, users need to confirm thesites to which they send sensitive information(Evanschitzky et al., 2007 ).2
 
 Data Privacy and Lawful Interception
The issue of data privacy is often dismissed as one that may not matter much. However,more and more technologically aware customers that rely on E-commerce tools realizethat sending messages over a network makes them subject to eavesdropping. And oncestored in a file or a database, the data is subject to perusal months or even yearslater(Dennis et al., 2004 ).
Broad Problem Area / Background
The online businesses through Internet marketing make consumers better informed aboutavailable products, product quality and prices, which mitigates problems of asymmetricinformation(Khosrow-Pour, 2006). The entry of new retailers is facilitated, competitionand economic efficiency is boosted and the market powers of consumers improved.Retailers need to respond strategically by using augmented product and pricedifferentiation(Reynolds et al., 2004 ). There will also be substantial changes in thedivision of tasks between retailers and customers. However, important obstacles to thesedevelopments like, Technological vulnerability, Quality problems in the information onthe Internet, cognitive limitations of individuals, and weaknesses in distributionchannels(Tan, 2003).Instead of traditional, brick-and mortar model for retailing, companies are recognizingthat online retailing is now a sine qua non and are moving assertively into the channel,and they are optimistic about the future of multi-channel retailing(Dennis et al., 2004).In addition, because of the interactivity afforded by the medium, the marketers can tailor individual advertising and formulate advertising messages adaptively(Clarke, 2005)through
o
 Email Marketing 
The promotion of products or services through email(Bidgoli, n.d.)
o
 Permission Marketing 
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