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Study on customer preference towards Online Grocery stores in Pune

Background of study:
A grocery store is a retail store that primarily sells food. A grocer is a bulk seller of
food. Grocery stores often offer non-perishable food, with some also having fresh produce, butchers,
delis, and bakeries. Large grocery stores that stock significant amounts of non-food products, such
as clothing and household items, are called supermarkets. Some large supermarkets also include a
pharmacy and an electronics section. In the United States, Canada, and United Kingdom,
supermarkets and convenience stores are sometimes described as grocery businesses, or simply
grocers. Small grocery stores that mainly sell fruits and vegetables are known as produce markets or
greengrocers and small grocery stores that predominantly sell prepared food, such as candy and
snacks, are known as convenience stores or delicatessens.
Internet is changing the way consumers shop and buy goods and services, and has rapidly
evolved into a global phenomenon. Many companies have started using the Internet with the aim of
cutting marketing costs, thereby reducing the price of their products and services in order to stay
ahead in highly competitive markets.
Companies also use the Internet to convey communicates and disseminate information, to sell
the product, to take feedback and also to conduct satisfaction surveys with customers. Customers use
the Internet not only to buy the product online, but also to compare prices, product features and after
sale service facilities the will receive if they purchase the product from a particular store. Many
experts are optimistic about the prospect of online business.
In addition to the tremendous potential of the E-commerce market, the Internet provides a unique
opportunity for companies to more efficiently reach existing and potential customers. Although most
of the revenue of online transactions comes from business-to-business commerce, the practitioners of
business-to-consumer commerce should not lose confidence. It has been more than a decade since
business-to-consumer E-commerce first evolved. 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. Many of their studies have posited new emergent factors or assumptions
which are based on the traditional models of consumer behaviour, and then examine their validity in
the Internet context.
Groceries are different from many other products, such as music and books that are
commonly purchased online. Many grocery products are perishable and therefore time-sensitive in
terms of their delivery needs. In addition, groceries are a replacement product, i.e., the same basket of
products is more-or-less purchased on a regular basis. Finally, groceries are high-touch items,
meaning that consumers like to inspect the quality of items they are purchasing.
Five years ago online grocery sales were only $85 million however; this growing market had attracted
a number of "pure-plays" - companies that focused exclusively on selling through the Internet, and
attempted to replace traditional bricks-and-mortar supermarkets. Most of these pure-plays failed
spectacularly. Today, traditional bricks-and-mortars stores are increasingly entering the online market
in an attempt to leverage both brand awareness and create distribution efficiencies.
Online security and privacy are also of concern to consumers. In particular, security issues generally
revolve around the transfer of personal and financial information (for example, addresses, telephone
numbers, credit card numbers, etc.) over the Internet. Another privacy concern relates to the use of
online consumer demographic and taste-related data. Online stores gather this information and can

use it to target costumers or sell to marketing firms for marketing analysis.

Online grocery services meet a number of consumer needs including providing products for niche
markets or helping the time starved consumer shop for the mundane weekly groceries. By delivering
products to consumers' homes, the homebound aged and handicapped can participate in the shopping
Even though there has been a great decline in the number of pure-play online stores, there
appears to be a solid market for shopping online.
The major business model that is working today requires the support of the established bricks-andmortar supermarkets. This model is effective as it creates distribution efficiencies and leverages
reputation, which is an important consideration for consumers in light of the perishable nature of
many grocery products.

Significance of Study:
1)Study the attitude of customers towards online shopping, also determining the factors which
influence the consumer to purchase goods and service.
2) The project will depict the attributes of online shopping influencing the purchase decision by the
respondent. It will also determine the issues regarding the online shopping.
3)The project determines the purchase decision with respect to grocery. It will determine the place
preference of grocery shopping with respect to price, quality, variety, proximity and offers/ discounts.

Literature Review:
India is among the fastest-growing markets and has been identified as one of the significant
potential markets for the company,"
According to country manager at eBay's India explains that Indian consumers toward buying
high margin products such as clothes and shoes as is the trend among eBay shoppers in the West
rather than electronic gadgets and books, which are the most popular choices now but command lower
profit margins and are less frequent purchases. He depicted that India's nascent e-commerce market,
which till recently was largely limited to people buying train, flight and movie tickets, is in the middle
of a surge as a younger, tech-savvy middle class increasingly takes to shopping online in a country
seeing rapid growth in Internet usage. India's e-commerce market was worth about $3.8 billion in
2009, it went up to $12.6 billion in 2013. In 2013, the e-retail segment was worth US$2.3 billion.
About 70% of India's e-commerce market is travel related. According to Google India, there were 35
million online shoppers in India in 2014 Q1 and is expected to cross 100 million mark by end of year
2016.Consulting firm Techno park predicts a $70-billion annual market by 2020
E-commerce: A boon for the current economic downturn
According to Google India, there were 35 million online shoppers in India in 2014 Q1 and is
expected to cross 100 million mark by end of year 2016
With entry and operational costs being comparatively low than the other countries like US, the second
half of 2011 and the beginning of the current calendar have seen the launch of a good number of new
e-commerce sites spanning across a variety of businesses womens fashion, mens fashion, shoes,
followed by accessories, groceries, sports, toys, home furnishings, jewellery, automotive, bicycles,
electronics and electrical equipment etc.

Connecting the local kirana stores with the buyers while storing inventories on the Cloud
Vijay Singh, CEO & MD of says that in order to reduce the cost to their
business operation they applied the concept of cloud computing, where it connects the local kirana
shops with the buyers. It enables the business to reduce the inventory cost as all the inventories are
handled by the local vendor.
Key drivers for success for e-commerce
Reduction in operational cost as the entire business can be moved online, the need for
physical stores has become obsolete. Less infrastructural investment and associated labour costs
drives up the profit margin.
It is far easier and quicker to compare prices of goods online, equipping the customer with the
information to decide the right price or terms for themselves. With services like COD, customers can
trust the process of going online and purchasing.
Market penetration also becomes far more achievable with e-commerce; it is possible for a merchant
in Mumbai to extend his reach to north-eastern cities or even rural villages that are now connected by
the online network.
E-commerce facilitates shopping anytime, anywhere and for almost anything desired. Busy
consumers prefer this to the restrictions of when a mall/shop is open and the need to physically travel
to a shop. Online business takes shopping a step further by taking itself to the customer creating
conveniences of shopping anywhere and at anytime.
In India, with the increasing propensity of social media, businesses have now begun to engage
their customers on social networking portals such as Face book. These are likely to be rapidly
developing marketing channels for the future.

Problem Statement:
Indian organized retailing is under transition today, bringing a lot of changes in format of
retailing. In this regard measuring customer satisfaction in organized. Understand the various
parameter that influence customer to purchase good online that offline

1) To study attitude of customers towards online shopping.
2) To find out the preferences of the consumer regarding the attributes of online shopping website.
3) To identify the issues faced by the user while online shopping.
4) To determine the parameters for choosing the particular shopping centre for purchase of grocery
5) To determine whether online grocery shopping will be beneficial and on what factors.

Scope of Project:
1)To determine which factor influences the consumer to go for online shopping.
2) To find out which feature of the website attracts the user to purchase the product from the online
shopping website.
3) To find out the whether grocery online shopping is beneficial for the user.
4) To analyse which factors influence the user to buy online grocery.

Research design and methodology:

A Research design specifies the methods and procedures for conducting a particular study. It
is blue print to which the research is to be conducted. Descriptive research design has been considered
as a suitable methodology for present study and for data analysis.
1. Primary data
Primary data consists of original information gathered from sample size of 200 respondents residing
in Pune, India.
2. Secondary data
Secondary data consists of information that already exists and that was collected in the past for some
other purposes.

Data collection tool used:

The data collection tool used for the research is Questionnaire to get the primary data for the
empirical research on consumer preference on online grocery shopping.

Practical utility of the study:

1)Understand customer expectation and current buying online buying behaviour.
2)According to outcomes company will change their marketing activity for increase market share.

Expected Outcome:

Customer will agree to buy grocery online rather than shopping of grocery with the
traditional method.

Consumer will buys goods from the online shopping website on the basis of factors
like offers and discounts, variety of product available, free home delivery, website
user friendliness and cash of delivery payment option.