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Determinants of customers online purchase intention: an empirical study in India


Arun Thamizhvanan
Great Lakes Institute of Management, Chennai, India, and

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Received 25 April 2012 Revised 6 July 2012 29 August 2012 Accepted 8 September 2012

M.J. Xavier
Indian Institute of Management Ranchi, Ranchi, India
Abstract
Purpose According to Associated Chambers of Commerce and Industry of India (ASSOCHAM), the size of the Indian online retail industry is INR 2000 crore and the industry is projected a steady annual growth rate of 35 per cent to reach INR 7000 crore by 2015. Given the growing importance of the online retail industry in India, it remains imperative for web retailers and internet marketers to understand the determinants of online customers purchase intention to decipher what is important to the Indian online customer. This paper attempts to identify the determinants of online purchase intention among youth in the Indian context. Design/methodology/approach Based on a detailed literature review, customer online purchase intention shopping orientation factors such as impulse purchase orientation, brand orientation and quality orientation were considered along with online trust and prior online purchase experience. The results are based on 95 valid responses received from the online survey. Findings The research established that impulse purchase orientation, prior online purchase experience and online trust have signicant impact on the customer purchase intention. Males are found to have more intention to shop online than females. Research limitations/implications A bigger and more representative sample which includes respondents from all walks of life would have been appropriate though the internet savvy students contribute the major share of online buyers. Practical implications The study has implications for web-retailers, marketing managers, internet marketers, online vendors and web-shoppers in India. Indian online shoppers typically tend to seek offers and great value price deals instead of brand or quality. Online retailers may target the impulse purchase orientation nature of Indian consumers and should focus on increasing online trust. Originality/value In the Indian context, this is the rst time shopping orientations have been studied with customers online purchase intentions. Keywords Online purchase intention, Shopping orientation, Online trust, Prior online purchase experience, India, Internet shopping, Buying behaviour, Young adults, Retailing Paper type Research paper

Introduction According to Internet World Stats[1], India has the third largest number of internet users in the world after China and the USA despite having a low internet penetration rate of just 8.5 percent. Indias count of internet users has been increasing at a CAGR of 35 percent from 2007. From 100 million users in 2010, the number will touch 237 million users by 2015 as per Boston Consulting Group 2010 report[2]. This large internet base will have a direct impact in the Indian internet shopping or online retail business (also called as e-tailing).

Journal of Indian Business Research Vol. 5 No. 1, 2013 pp. 17-32 q Emerald Group Publishing Limited 1755-4195 DOI 10.1108/17554191311303367

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When India had its rst e-commerce web site Fabmart.com (Indiaplaza now) in 1999, only a small percentage of the three million internet users transacted online and the market size was at a modest US$11 million[3]. As per Forrester 2012 report[4], the same Indian e-commerce market is projected to reach US$8.8 billion by 2016 and its growth will be the fastest within the Asia-Pacic region at a CAGR of over 57 percent during 2012-2016. According to a recent article by The Economist (2012), out of 100 million Indians who surf, 30 million search for bargains online and that number is projected to increase by 1.5 million every month[3]. Convinced of the growth potential in Indian e-commerce, the investors have sown more than US$450 million in 2011 alone[3]. The reasons for such phenomenal growth include raising per capita income of the middle class and government initiatives in the telecom sector like introducing 3G, 4G, WiMax services. Government banks and railways have encouraged the users to come online for transacting, making a large population net savvy. The Indian railway web site irctc.com is the biggest contributor accounting for more than one-third of total revenues from e-commerce in 2010[5]. Less developed distribution in terms of supply chain has also urged the online users of the smaller cities to go online for shopping. Cities having a population of under three million has made roughly for one-third of all products purchased online in India. IMF[6] has projected that the per capita income of the Indians under 25 will reach $2,300 by 2016 from $1,500 in 2011[3]. Due to this, the young city dwellers too will eventually have more money to spend online in the coming years. Before 2009, the majority of online purchases in India had been in the travel sector. According to IAMAI[7] 2011 report[8], there has been an evident change in the shopping style of Indian online users who are observed to actively indulge in purchases as part of their daily digital interactions post-2009. Another First Data-ICICI 2012 report[9] highlights a similar shift that urban Indian online users who were not ready to spend more than INR 5,000 online earlier, are ready to spend up to INR 25,000 online. Hence, in order to take full advantage of the Indian online market, rst and foremost, rms need to have a clear understanding of the Indian online users preferences and mindset, in addition to the other factors like governmental policies, industry dynamics, etc. This paper attempts to provide unique insights into the Indian online consumers mindset by discussing the determinants of their online purchase intention. This paper is divided into four parts. After the introduction, the relevance of the research and its contribution is discussed. It is followed by a detailed review of literature of all the constructs involved in the study concluding with the hypotheses of the proposed research. Then, research methodology is presented which is followed by data analysis and ndings. The paper ends by discussing managerial implications, limitations of the research and recommendations for future research. Relevance of the research and its contribution For understanding the emergence of new markets, researches in shopping orientation are of paramount importance. Researches on shopping orientation have offered rich insights into understanding the emergence of catalog retailing in the USA three decades ago (Berkowitz et al., 1979) and also in the emergence of internet retailing in the USA (Girard et al., 2003; Rohm and Swaminathan, 2004). Similar studies on non-store shopping orientations of customers in other geographies have contributed to

a greater understanding of the online markets in the respective countries (Brown et al., 2001; Shim et al., 2001a, b; Ling et al., 2010). Furthermore, for understanding the online shopping behavior mindset, internet marketers are always encouraged to explore the determinants of customer online purchase intention. Purchase intention is the nal consequence of a number of various factors in an online shopping context (Ling et al., 2010). Shopping orientations have shown signicant effects on purchase orientation in a Western context (Brown et al., 2001; Seock, 2003; Gehrt et al., 2007) and also in other developed e-commerce markets like Malaysia (Ling et al., 2010). Online trust has been the predominant inuence on customer online purchase intention (Jarvenpaa and Tractinsky, 1999; Pavlou, 2003). Demographic factors like age, gender, education and the like have been studied for their effect on adoption of customer online purchase (Li et al., 1999). Prior online purchase experience has been found to have a signicant effect on purchase intention in the Western context (Shim and Drake, 1990; Shim et al., 2001a, b). Despite these ndings, the relevance of these ndings in Indian context remains debatable. Unless the ndings are validated in different cultural settings across the globe, prior ndings would remain valid only in their own conned contexts. The Indian online market is distinct from the other markets being covered in the present studies. There are many reasons for saying that the Indian context is different. The growth of internet in India is still considered to be in nascent stage as the internet penetration has not even exceeded 10 percent. Furthermore, the cyber laws and its regulatory framework are also in a nascent stage. Culturally, India has its own unique set of sensitivities and socio-psychological barriers. Shankar et al. (2002) asserts that cross-cultural sensitivities ought not to be ignored at all, especially in online research, as they are more important in an online shopping context than ofine context. Therefore, determining the validity of the identied factors inuencing online purchase in the west and other developed e-commerce markets seems to be appropriate before using the existing ndings in an Indian context. Regarding the studies in an Indian context, Ganguly et al. (2009) have studied the mediatory inuence of online trust. Dash and Saji (2007) have investigated the effect of web site characteristics on online trust. To the best of our knowledge, there is no signicant scholarly research to study the role of different factors on Indians online purchase intentions. Therefore, in this paper, we attempt to examine the inuence of shopping orientation, online trust, demographics and prior online purchase experience on the customer online purchase intention in the Indian context. Thus, objectives of our study are: (1) to review the past literature on the constructs taken for the study; (2) to empirically test the role of shopping orientation, prior online purchase experience, online trust on the customer online purchase intention among Indians; and (3) to empirically test the inuences of demographics on customer online purchase intention among Indians. Literature review In this section, the literature concerning the key construct of the study namely customer online purchase intention is discussed rst, followed by the literature on the other determinants of purchase intention leading to the development of hypotheses.

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Customer online purchase intention According to the theory of reasoned action, consumer behavior could be predicted from its corresponding intentions (Ajzen and Fishbein, 1980). Intentional measures are more effective than behavioral measures in drawing new customers as customers tend to skip real preferences because of their constraints (Day, 1969). Customer online purchase intention is dened as the construct that gives the strength of a customers intention to purchase online (Salisbury et al., 2001). Pavlou (2003) observed online purchase intention to be a more appropriate measure of intention to use a web site when assessing online consumer behavior. Since online transaction involves information sharing and purchase action, purchase intention will depend on many factors (Pavlou, 2003). In order to trigger online purchase intention among consumers, web retailers often need to focus on these factors to enhance the chance of purchase by customers. While developing a reference model for summarizing the antecedents of customer purchase intention from 45 research studies on online shopping, Chang et al. (2005) categorized the antecedents into three categories namely, perceived characteristics of the web as a sales channel, web site and product characteristics and consumer characteristics, thus identifying more than 80 variables as antecedents. Knowing that it is not possible to explore them all, the study connes itself in studying the effect of shopping orientations, prior online purchase experience, online trust and demographics on online purchase intention as these have not been studied together in the Indian context. Online trust and customer online purchase intention Online trust is a necessity when it comes to online shopping (McCole and Palmer, 2001). Due to the risky nature of online shopping, trust and risk play signicant roles in effecting online transactions (Pavlou, 2003). Trust contributes positively towards the success of online transactions (Jarvenpaa and Tractinsky, 1999). Online trust needs to be there when personal nancial information and personal data is shared while making a purchase online (Egger, 2006). Online trust is based on the perception of the risks or benets of the online transaction (Teo and Liu, 2007). In the Indian context, the inuence of the online trust as of mediating effect has been studied on customer online purchase intention (Ganguly et al., 2009). Numerous studies have concluded that the higher consumer online trust will result in higher customer online purchase intention (Verhagen et al., 2006; McKnight et al., 2002; Lim et al., 2006; Ling et al., 2010). Thus, we propose: H1. Higher customer online trust will lead to higher customer online purchase intention. Prior online purchase experience and customer online purchase intention Future behavior is determined by prior experiences. Online purchases are still considered to be risky compared to ofine retail purchases (Laroche et al., 2005). In an online shopping environment, prior online purchase experience leads to the reduction of uncertainties and eventually leads to an increase in the customer purchase intention (Shim and Drake, 1990). Online shoppers who have bought products online are more open and inclined to shop online than others (Lee and Tan, 2003). Shim et al. (2001a, b) found that past satisfactory online purchase will lead to future online purchase while past negative experience will decrease online purchase intention. In the Indian context, thus we propose:

H2. Higher prior online purchase experience will lead to higher customer online purchase intention. Shopping orientations and customer online purchase orientation Shopping orientations are dened as a general disposition toward the acts of shopping (Brown et al., 2001). Swaminathan et al. (1999) asserted that shopping orientation is one of the prime indicators of making online purchases. The concept of shopping orientation refers to a specic segment of lifestyle that is operationalized by various activities, interests and opinion statements relevant to shopping (Li et al., 1999). Being regarded as a multi-dimensional construct, shopping orientation comprises of many constructs referring to different attitudes and opinions. Vijayasarathy and Jones (2000) segmented the shoppers into seven distinct varieties namely: in-home shoppers, economic shoppers, mall shoppers, personalized shoppers, ethical shoppers and convenience shoppers. They found in-home shoppers more inclined to online purchase and having higher purchase intention than the rest of the classes. Seven shopping orientation types identied by Gehrt et al. (2007) are recreation, novelty, impulse purchase, quality, brand, price and convenience. Of all the seven shopping orientations, impulse purchase orientation, quality orientation and brand orientation were perceived as more important from the web retailer perspective and often investigated together (Ling et al., 2010). These three orientations were chosen for this study. a. Impulse purchase orientation. Impulse purchase behavior happens when a customer feels the urge to purchase something at the very instant without any more evaluation (Rook, 1987). According to Piron (1991), Impulse purchase behavior is an action done without any prior plan as a result of a stimulus. With the rampant growth of online shopping, the studies made by Donthu and Garcia (1999) have found that impulse purchase orientation is a default characteristic of an online shopper. Thus, we propose: H3. Higher impulse purchase orientation will lead to higher customer online purchase intention. b. Brand orientation. In internet transactions, customers use trusted corporate and brand names in place of product information while purchasing online (Ward and Lee, 2000). Jayawardhena et al. (2007) have established from their study that there is a signicant effect of brand orientation on customer online purchase intention. Thus, we propose: H4. Higher brand orientation will lead to higher customer online purchase intention. c. Quality orientation. Bellenger and Korgaonkar (1980) found that one of the things that recreational shoppers tend to take into consideration is quality when choosing stores for shopping. In an online shopping context, Gehrt et al. (2007) found that customers who shop for recreation online are signicantly associated with quality. Thus, we propose: H5. Higher quality orientation will lead to higher customer online purchase intention. Demographic factors Though demographic variables are not extensively studied, males were found to shop online more than females (Li et al., 1999). Access to credit card and computer

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experience has a signicant effect on purchase intention (Slyke, 2002). Sin and Tse (2002) have studied various demographic variables like education level, gender, age and level of internet usage on online purchase intention. They found that the prole of online shoppers tends to be male, well educated, between 21 and 30 and have a high internet usage. Hence in our research study, we propose to study the effect of gender, age, education, level of internet usage, credit card and computer usage experience on customer online purchase experience. Research methodology Owing to the existence of a body of knowledge in this area and the identication of hypotheses, descriptive research design was chosen for the study. The development of questionnaire design and the selection of the sample are explained in the following paragraphs. Questionnaire design The questionnaire developed had two parts. The rst part of the questionnaire had questions on demographic details of the potential respondents including gender, age group, education level, number of hours of internet use in a day and possession of a credit card or internet banking facility. The second part of the questionnaire had 33 statements covering the independent and dependent variables of the study. Each statement was presented as a ve-point Likert scaled-response question with 1 being strongly disagree to 5 strongly agree. The multi-scaled items used to measure the constructs were sourced from different research studies. The studies done by Gehrt et al. (2007) and Seock (2003) were adapted for developing multi-scaled items for independent variable constructs namely brand orientation, quality orientation and impulse purchase orientation. The scale items of online purchase intention were adapted from Kim et al. (2004) while those of prior online purchase intention were adapted from Brunelle and Lapierre (2008). The items on online trust were based on the studies by Chen and Barnes (2007). Sampling Most of the online shoppers in India belong to younger age groups according to IAMAI 2011 report[10] and they are found to be the heavy users of the internet according to the Comscore 2011 study[11]. Furthermore, since students from management schools have continuous internet access provided by their institutes, they became an ideal target sample for our study. The online survey method was chosen as it had more advantages over the intercept survey in terms of reaching out to the target sample, time, cost and ease of report generation. A total of 360 postgraduate MBA students from two private business schools were invited to participate in this research through e-mail by sending the link to ll the survey online. In total, 110 responses were received. The response rate for the e-mail questionnaire was 30.6 percent which can be compared as equivalent to the average e-mail questionnaire response rate of 33 percent found in recent research studies (Shih and Fan, 2009). Out of 110 responses, 95 respondents had shopped online and only those were asked to ll the questions based on the variables of the study. The respondents were instructed to remember the recent online purchase experience when they were lling in the questions on online trust. In studies where large variance (i.e. above 25 percent) is expected to be explained, a sample size of 80 would be

sufcient for a regression model having up to 20 predictors (Field, 2005). The sample size of above 30 is adequate to fulll the assumptions of normality required to conduct ANOVA. Hence, the processed 95 responses were considered sufcient to carry out both the tests in our study. Data analysis and results This section deals with the presentation of survey ndings, data analysis reports and discussion of the ndings. At rst, the demographic prole and technical prole of respondents are presented. It is followed by the reporting of reliability test and validity test ndings of the questionnaire. Then, the multiple regression diagnostics and the regression analysis ndings are discussed. Further, the one way ANOVA test ndings are discussed for understanding the inuence of demographics on customer online purchase intentions. Prole of respondents The proles of 95 respondents who have shopped online before were taken for the study and the rest were discarded. The details of those respondents are represented in Table I. About 73 percent of the respondents were male and 82 percent of the respondents were below 30 years of age. There were nearly 50 percent of respondents from each level of education namely, bachelors and masters level. The summary details of the other categorical variables, namely the number of hours per day and possession of credit card or netbanking facility, are given in Table II. More than half of the respondents (58 percent) had both credit card and netbanking facility.
Variable Gender Age Education Categories Male Female Below 30 Above 30 Bachelors Masters Frequency 73 22 82 13 48 47 % 76.84 23.16 86.32 13.68 50.53 49.47

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Table I. Demographic prole of respondents

Variable Number of hours of internet use per day

% 8.42 31.58 24.21 16.84 18.95 3.16 33.68 61.05 2.11

Categories Less than 2 hours Above 2 and up to 4 hours Above 4 and up to 6 hours Above 6 and up to 8 hours Above 8 hours Credit card only Netbanking only Both None

Creditcard or netbanking facility

Table II. Technical prole of respondents

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Reliability test Reliability analysis was done on all the constructs by calculating Cronbachs a. The results are presented in Table III. For all constructs except quality orientation, the Cronbachs a-values were well above 0.7 as recommended by Cavana et al. (2001). George and Mallery (2003) recommend rejecting any construct which has a Cronbachs a of less than 0.5. Since the quality orientation had a Cronbachs a of 0.517 which is above the cutoff for rejection, it was included in the study to improve the overall representativeness of the model. Thereby a-values, indicating the internal consistency of the scales of the constructs used in the study, conrm the reliability of the scales used. Validity test Principal component analysis was used to measure the construct validity (Cavana et al., 2001). The data from the survey were subjected to two tests before principal component analysis was done. The statistical test for Bartlett test of sphericity was signicant ( p 0.000; df 231). The value of Kaiser-Meyer-Olkin (KMO) was 0.785 and in the acceptable range of 0.5 and 1.0. Both these tests show that principal component analysis was appropriate for the data collected from the survey. The factor analysis was done using VARIMAX procedure for orthogonal rotation. The details of the principal component analysis are presented in Table III. The SPSS output shows that the Eigen-values for all constructs were greater than 1.0, ranging from the highest 4.259 for online trust to the least 1.432 for quality orientation. The total variance explained by the six factors extracted is 72.023 percent. The convergent validity is established by factor loadings greater than 0.50. All items were easily discriminated and grouped according to the respective constructs. There were no overlapping items which establish discriminant validity. Multiple regression analysis a. Regression diagnostics. The six assumptions of regression analysis have to be addressed before proceeding for regression analysis as per theory. Field (2005) describes the assumptions as follows: (1) normality; (2) linearity; (3) independence of error term; (4) absence of multicollinearity; (5) absence of heteroscedasticity; and (6) absence of outlier and inuential observations. When the histogram was drawn, the distribution of residuals was symmetric and unimodal satisfying the normality assumption. No heteroscedasticity was observed and the distribution was linear in nature, when the scatter-plot diagram was generated. The value of Durbin-Watson was 1.524 which was relatively nearer to 2, showing the independence of error term. There was no multicollinearity in the data, as the tolerance statistics were all above 0.2 and VIF values below 5. The absence of outlier and inuential observations were established by the normal p-p plot analysis showing a uniform spread around the normal probability plot of a straight line when graphed against the predicted values.

Factors name Variable Impulse purchase orientation When my intention is to merely browse through the web site, I sometimes make a purchase I am impulsive when purchasing products/services online When I purchase products/services spontaneously from the web-retailer, I feel released It is important for me to buy online products/services with well-known brand names When I shop online for products/ services, I would prefer to buy wellknown brand name I feel comfortable of using the online shopping web sites I am experienced with the use of the online shopping web sites I feel competent of using the online shopping web sites I was happy with my online shopping I was pleased with my online shopping I was satised with my online shopping I like online shopping Online shopping web sites are a t means to buy products The online retailer wants to keep promises and obligations The web site of this online retailer keeps my best interests in mind The online retailer is trustworthy and honest The online retailer wants to keep promises and obligations The infrastructure of the web site of this online retailer is dependable Compared to other web site offered the web site of this web-retailer is secure and reliable The web site of this online retailer offers secure personal privacy The availability of high quality products/services provided by the webretailer is very important to me My standards and expectations from the products/services I buy from webretailer are very high

Factor Eigenloading value 0.811 0.811 0.757 0.950 0.927 0.839 0.833 0.820 0.855 0.853 0.844 0.522 0.522 0.825 0.785 0.768 0.723 0.713 0.675 0.600 0.812 0.777 1.432 3.217 2.782 1.987 2.167

Percentage of variance explained 9.851

Cronbachs reliability coefcients 0.744

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Brand orientation

9.033

0.931

Prior online purchase experience

12.646

0.869

Purchase intention

14.625

0.864

Online trust

4.259

19.36

0.887

Quality orientation

6.508

0.517

Notes: KMO measure of sampling adequacy 0.785; p 0.000 ( p , 0.05); df 231; cumulative percentage rotation sums of squared loadings 72.032

Table III. Factors identied by the principal components factor analysis

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b. Regression results. Multiple linear regression was conducted to determine the structure of the relationship between the independent variables namely online trust, prior online purchase experience, impulse purchase orientation, brand orientation and quality orientation on the dependent variable that is online purchase intention. The results are given in Table IV. From Table IV, the following interpretations are derived. Online trust and prior online purchase experience Online trust is found to have a signicant impact on the dependent variable customer online purchase intention as the p-value was less than 0.05. There appears no difference between the Indian consumer and the rest of the world as per available studies in online trust as online trust has been found to be an integral component of customer purchase intention in studies conducted abroad (McCole and Palmer, 2001; Ling et al., 2010). Hence, we nd that our H1 is supported. H2 about prior online purchase experience having a positive effect on the customer purchase intention was supported by the regression results as its p-value was less than 0.05. This is in concurrence with the research ndings of Shim and Drake (1990) who found that prior online purchase experience enhance customer purchase intention by reducing uncertainties. Here too, we nd no difference between online shoppers of India and others as per the studies. This represents that in an Indian context too, as indicated by prior studies in other geographies, customers who purchase online need to have trust in the online web retailer; and prior online purchase experience seems to positively affect online purchase intention. Shopping orientations The p-value of the impulse purchase orientation ( p-value 0.037) is less than the cutoff value of 0.05. Therefore, the research concludes that an impulse purchase orientation has signicant impact on the customer online purchase intention. Thus, H3 is accepted. This nding is consistent from the existing literature in the Western context by Zhang et al. (2007) which states that impulse purchase shopping orientation will positively affect the customer online purchase intention. Hence we see similarity between the Indian online shopper and the shoppers from the other countries. This similarity could be explained. As the majority of Indian internet users belong to the younger age group, it is understandable that the Indian online users are as impulsive as the Western when it comes to intention to purchase online.
Unstandardized coefcients b SE (Constant) Online trust Prior online purchase experience Impulse purchase orientation Brand orientation Quality orientation 0.114 0.390 0.287 0.096 0.125 0.069 0.509 0.120 0.094 0.045 0.069 0.049 Standardized coefcients b t Sig. 0.326 0.300 0.180 0.156 0.117 0.225 3.263 3.042 2.118 1.820 1.399 0.823 0.002 0.003 0.037 0.072 0.166

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Table IV. Results of multiple linear regression analysis

Notes: Dependent variable online purchase intention; independent variables impulse purchase orientation, quality orientation, brand orientation, online trust and prior online purchase experience; R 0.659; R 2 0.434; adjusted R 2 0.400; F(5, 89) 12.734; p , 0.001

The regression results point out that brand orientation has no impact on purchase intention as the p-value of 0.072 is greater than 0.05. Hence, H4 is rejected. This is contrary to the ndings from the studies done in Western contexts which nd brand orientation positively inuencing customer online purchase intention (Jayawardhena et al., 2007). We nd the rst distinction of the Indian online user that he/she has shown no brand orientation when it comes to intention to shop online. Likewise, the results show that quality orientation also has no impact on purchase orientation as its p-value 0.166 (. 0.05). Therefore, H5 is also rejected. This is quite different from the nding of Gehrt et al. (2007) who has concluded that quality orientations would positively affect the customer online purchase intention. The second unique distinction we nd about an Indian online user is that he/she has no quality orientation when it comes to intention to shop online. When compared to other countries as per prior studies, brand orientation and quality orientation have no signicant effect on the customer purchase intention in India. It may be due to the fact that Indian student online shoppers are seeking offers and great value price deals instead of getting oriented by brand or quality. Regression equation The multiple regression equation based on the SPSS output is given below: Customer Online Purchase Intention 0:114 0:096 Impulse Purchase Orientation 0:069 Quality Orientation 0:125 Brand Orientation 0:390 Online Trust 0:287 Prior Online Purchase Experience Relative importance based on regression output The unstandardized b-coefcient among the independent variables ranges from 0.069 to 0.390. Before looking at the standardized b-coefcients, p-values of independent variables are checked. It indicates that the standardized b-coefcients of impulse purchase orientation, online trust and prior online purchase experience are signicant (as p-values are less than 0.05 at 5 percent signicance level). Hence the online trust is the most important determinant in affecting the customer online purchase intention (with standardized b of 0.326) followed by prior online purchase intention (with standardized b of 0.300) and with impulse purchase orientation having the least inuence (with standardized b of 0.180). Table V presents the hypotheses outcomes based on regression results. One way ANOVA: demographics on online purchase intention One way ANOVA analyses was conducted to nd out if there is any relationship between the demographic variables taken in the study and customer online purchase intention. One way ANOVA compares the means to nd any signicant differences across the categories of the non-metric independent variables like gender, age, education, number of hours of internet use per day and possession of a credit card or netbanking facility. One way ANOVA results are summarized in Table VI.

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Independent variables tested Online trust Prior online purchase experience

Hypotheses H1. Higher consumer online trust will lead to higher customer online purchase intention H2. Higher prior online purchase experience will lead to higher customer online purchase intention H3. Higher impulse purchase orientation will lead to higher customer online purchase intention H4. Higher brand orientation will lead to higher customer online purchase intention H5. Higher quality orientation will lead to higher customer online purchase intention

Outcomes Supported Supported Supported Not supported Not supported

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Table V. Summary of the hypothesis and outcomes

Impulse purchase orientation Brand orientation Quality orientation

Source Demographic prole Table VI. One way ANOVA results summary of demographics on online purchase intention Technical prole

Variable Gender Age Education No. of hours of internet use per day Creditcard or netbanking

F-statistic F(1, F(1, F(1, F(4, F(3, 93) 5.096 93) 0.358 93) 0.852 90) 1.082 91) 2.219

Signicance 0.026 * 0.596 0.358 0.370 0.091

Note: Signicant at: *p , 0.05

As seen in the Table VI, there is no signicant difference between the categories of age, education level, no. of hours of internet use per day and possession of credit card or netbanking facility. Only gender is found to have a signicant p-value of less than 0.05. The means reveal that males have higher online purchase intention than females. This nding is consistent with Li et al. (1999) which concluded that males shop online more than females. So we can establish that males shop online more than females in an Indian context. But in the Western context, age, education level, no. of hours of internet use per day and possession of credit card or netbanking was found to be signicant. This difference in the effect of demographics between Indian and Western online users may be explained. Age and education had just two categories which were not uniformly distributed. The categories in technical prole showed no signicant difference due to less diversity of age and mere student representation. Managerial implications This research establishes that impulse purchase orientation, prior online purchase experience and online trust have signicant impact on the customer purchase intention. The study has implications to web retailers, marketing managers, internet marketers, online vendors and web-shoppers in India. Web retailers and internet marketers specically will be able to develop effective and efcient web-shopping strategies to attract new and potential web-shopping customers if they know the determinants of purchase intention. Targeting the impulse purchase orientation nature of Indian consumers, the online retailers could concentrate on drawing the online shoppers with attractive deals for a limited time. Online retailers could also encourage the one time customers to purchase again by offering special discounts or offers as a reward for

loyalty in using the web site for purchase. As cited by prior researchers, web retailers in India too should focus on increasing the online trust. This can be done by various online trust building measures like giving 30 day money-back guarantee on products bought online, on time delivery, cash on delivery payment option and effective 24 7 customer care call center to address complaints. The online retailers should also have truthful and authentic information about products sold through their site all the time. Males have more intention to shop online could be utilized well by the online retailers by promoting more products and related advertisements targeting males in the population. Limitations and recommendation for future research Though the ndings offer some new insights in an Indian context, the research has its own limitations. The convenience sample of 95 MBA graduates may not be representative. Hence the nding may not be generalizable though internet savvy students contribute to a major percentage of online shoppers in India. A bigger and more representative sample which includes respondents from all walks of life would have been more appropriate. There was no uniform representation across categories in the demographic variables considered for the study. In future studies, at least on a broader level, sample should be chosen so that there is uniform representation across categories in the demographic variables. The responses with prior online purchase experience are analyzed while leaving those who have no online purchase experience. The reason why some Indians who have access to credit card and netbanking facility shy away from online retail shopping also needs investigation. E-tailers in India are competing with promotional pricing offers more than ever before. The reason why quality and brand orientation is insignicant in India, needs to be studied by introducing new constructs like value price, convenience orientation, etc.
Notes 1. www.internetworldstats.com/top20.htm (accessed 1 November 2011). 2. www.bcg.com/documents/le58645.pdf (accessed 1 November 2011). 3. www.economist.com/blogs/schumpeter/2012/04/e-commerce-india (accessed 1 June 2012). 4. www.iamwire.com/2012/04/india-to-be-the-fastest-growing-e-commerce-market-in-asiapacic-market-set-to-grow-to-8-8-billion-by-2016/ (accessed 1 June 2012). 5. www.business-standard.com/india/news/irctc-becomeslargest-contributor-to-e-commerce/ 353951/ (accessed on 1 November 2011). 6. IMF stands for International Monetary Fund. 7. IAMAI stands for Internet and Mobile Association of India. 8. www.scribd.com/doc/62145224/Report-on-Online-Commerce-March-2011-By-IAMAI (accessed 1 November 2011). 9. www.imediaconnection.in/article/920/Research/report-indian-e-commerce-market-may-hitusd-260bn-mark-by-2025.html (accessed 1 June 2012). 10. www.thehindubusinessline.com/industry-and-economy/info-tech/article2606518.ece (accessed 1 December 2011). 11. www.indiasocial.in/state-of-the-internet-in-india-report-by-comscore-report/ (accessed 1 November 2011).

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