37 387 401 January 2015 PDF

Volume II, Issue IX, January 2015 - ISSN 2321-7065
Consumers Behaviour towards Online Purchases

Mrs. Hemani Malhotra
Assistant Professor
Department of Resource Management,
SVT College of Home Science
SNDT Womens University, Mumbai
India
Dr. Manjit Kaur Chauhan
Associate Professor
University Department of Resource Management
SNDT Womens University
Mumbai, India
Abstract:
In 2011, 28 % of the worlds population was online with 22% percent being only from Asia-
Pacific. The latest trends in statistics also show that larger number of internet users live in Asia.
There has been a dramatic change in the way consumers have altered their way of shopping. Hence
it is of utmost importance to understand the online shopping behaviour in a developing country
like India and understand the factors affecting online purchases. Convenience sampling method
was used for the selection of respondents from various location of Urban Mumbai. The well-
structured questionnaire aimed to gather information about respondents attitude towards online
shopping and purchase perception towards online shopping was developed. The research results
provides interesting insights showing that 38% online buyers were from younger age group
between 20-30 years. The results also indicated that 53% of shoppers made online purchases in
last one year and the frequently purchased items were clothing and apparels (58%) and mobile
phones (43%). The problems and concerns experienced by buyers were related to security (52%),
product quality (51%) and others being low trust levels and privacy issues.

http://www.ijellh.com 387
Keywords: Online shopping, internet, barriers, consumer behaviour
Introduction:
As our lives become more fractured and cluttered, it isnt surprising that consumers turn to the
unrivalled convenience of the Internet when it comes to researching and buying products
(Jonathan Carson, President, International, Nielsen Online).
Online shopping is defined as the process a customer takes to purchase a service or product over
the internet (Jusoh 2012). Online shopping is the process of buying goods and services from
merchants who sell on the internet. Shoppers visit the web stores from the comfort of their homes
and shop as they sit in front of the computer. Since the mid 1990s the internet has created countless
applications in virtually every aspect of modern human life. The Internet makes the world smaller
and it benefits the people around the world to communicate and transact between each other.
Moreover, they are able to search for the information they needs in short time. There are now over
1.7 billion internet users in the world with the largest number being in Asia. In 2011, 28 % of the
worlds population was online with the percentage online in Asia now 22 percent
(Prompongsatorn, 2012). Online purchase rates have doubled in last three years for 12 of 22
measured categories (Nielsen N.V, 2014).
Consumer behaviour is the study of individuals, groups, or organizations and the processes they
use to select, secure, and dispose of products, services, experiences, or ideas to satisfy needs and
the impacts that these processes have on the consumer and society (Kuester, 2012). Consumer
behaviour of every individual is different from other depending on buying choices which is
influenced by buying habits and choices that are in turn tampered by psychological and social
drivers that affect purchase decision process (Brassington and Pettitt, 2000).
In the past decade, there has been a dramatic change in the way consumers have altered their way
of shopping. Although most of the consumers continue to purchase from a physical store, some
feel it convenient to shop online as it reduces the effort of travelling to a physical store. Decisions

can be made from home at ease, by looking at various product choices and price comparison can
be easily done with the competitors products, to arrive at a decision.
Internet marketing is conceptually different from other marketing channels. It promotes a one to
one communication between the seller and the end user with round the clock customer service.
Today, business internet marketing is the fastest growing segment of online commerce. The major
difference between traditional and online selling is the extent of interaction between the consumer
and the seller.
The Internet, as a means for both firms and individuals to conduct business, is nowadays one of
the most widely used non-store formats. According to Magee (2003), the growth in the number of
online shoppers is greater than the growth in Internet users, indicating that more internet users are
becoming comfortable to shop online. Furthermore, not only does the number of adopters grow,
but also the volume of their purchases is proportionally increased (Monsuwe et al, 2004). E-
commerce is benefiting from several positive trends, including the continued rollout of broadband,
increasing user comfort shopping online and the decline of certain brick-and-mortar retailers.
(Khan, 2011). The two most commonly cited reasons for online shopping have been convenience
and price (Chen and Chang, 2003). The capability of purchasing without leaving ones place is of
great interest to many consumers. Moreover, the use of internet tools for price searching and
comparison provides an additional advantage in consumers final decision making, as they can
purchase their desired products in the lowest available price (Haubl and Trifts, 2000).
Purpose of the study:

It has been seen that India's e-commerce market rose from about $2.5 billion in 2009 to $6.3 billion
in 2011, $8.5 billion in 2012 and further to $16 billion in 2013 and which is expected to touch $56
billion by 2023-- 6.5 percent of the total retail market (Industry Chamber Assocham, 2013). The
internet is being developed rapidly since last two decades, and with relevant digital economy that
is driven by information technology also being developed worldwide. High speed internet
connection and website services has promoted and enhanced the images of product and services.
Therefore, detailed product information and improved service attracts more and more people, thus

they change their consumer behaviour from merely relying on the traditional mode to more
advanced mode of internet shopping. On the other hand, more companies have realized that the
consumer behaviour transformation is unavoidable, and thus they have to change their marketing
strategy to meet the changing trend. Online shopping is very common in developed countries. Still
there is a huge research gap exists not only between countries, especially between developed and
developing countries, which may differ significantly between countries (Stiglitz, 1998; Shore,
1998; Spanos et al., 2002) that limit the generalization of research results from developed
countries to developing country contexts (Dewan and Kraemer, 2000; Clarke, 2001). Shore (1998)
and Stiglitz (1998) reported that implementation of information system depend on specific social,
cultural, economic, legal and political context, which may differ significantly from one country to
another country. Dewan and Kraemer (2000) and Clarke (2001) argued in their study that findings
from developed countries are not directly transferable to developing countries. Thus, this research
is intended to understand the online buying behaviour in developing countries like India and
factors affecting online purchases, as India are expected to be having largest number of online
buyers in the world.
Objectives of the study:

The main objective of this research is to study the online buying behavior of the consumers. The
specific objectives are:
1. To find out the online shopping behaviour of consumers in Mumbai, India.
2. To investigate the problems and issues most concerned while shopping online
3. To study the shopping trends of online buyers
Research Methodology:
Locale of the study: Respondents were selected from various location of Urban Mumbai as it is a
metropolitan city with people belonging to all segment of class, religion with access to modern
facilities.
Sampling Method: Convenience sampling method was used for the present study as the list of
online shoppers involved in online purchases was unavailable. There were 170 respondents
undertaken for this research study (85 males and 85 females). Anonymity and confidentiality were

assured. The respondents were drawn from different occupational categories, education, age,
gender or ethnic categories.
Instruments: The main instrument for this study was a questionnaire. The well-structured
questionnaire aimed to gather information about respondents attitude towards online shopping
and purchase perception towards online shopping was developed.
Research Findings and Discussion:
To study the consumer behaviour is very complex phenomena - as it is a kind of human behaviour,
and human beings are always not easily understood and are sometimes quite ambiguous.
According to Warner, consumer behaviour is defined as the study of the mental and physical
activities performed by individuals or groups that result in decisions or actions associated with the
purchase, use or disposal of goods and services. Several researchers have carried out studies in
their effort to examine the factors influencing consumers attitude and perception to make
purchases through online shopping. Attitudes toward online shopping are defined as consumers
positive or negative feelings related to accomplishing the purchasing behaviour on the internet
(Chiu et al., 2005; Schlosser, 2003).
Table 1. Percentage of subjects shopping online
Sample for the Shop online Do not shop Total

study online (n=170)
Male 55 (55%) 30 (43%) 85
Female 45 (45%) 40 (57%) 85
Total 100 (59%) 70 (41%) 170
It could be seen from table 1 that out of 170 subjects studied 59% of them shop online whereas
41% donot shop online. It could also be observed that males (65%) shop more online than females
(45%). Akhter (2002) in his study also indicted the similar results. Akhter (2002) indicated that
more educated, younger, males, and wealthier people in contrast to less educated, older, females,
and less wealthier are more likely to use the internet for purchasing.
Table 2. Demographic Factors affecting online shopping
Factors affecting online shopping Total (%) (n = 100)

Gender
Male 55 (55%)
Female 45 (45%)
Age
<20 21 (21%)
20 30 38 (38%)
30 40 16 (16%)
40 -50 15 (15%)
50 and above 10 (10%)
Education
Matriculation and below 5 (5%)
XIIth Passed 25 (25%)
Graduates 60 (60%)
Masters and Above 10 (10%)
Monthly Family Income (in
Rupees)
< 20,000 1 (1%)
20,000 50,000 39 (39%)
50,000 80,000 23 (23%)
80,000 1 Lakh 8 (8%)
1 Lakh 1.5 Lakh 8 (8%)
1.5 Lakh 2 Lakh 8 (8%)
Not Known 13 (13%)
When comparing the demographic factors of the subjects who shopped online as seen in Table 2
it was found that maximum subjects (38%) who shopped online ranged between the age group 20-
30 years. Based on educational qualification it was observed that maximum online shopping was
done by graduates (60%) and with monthly family income between Rs. 20,000 80,000. For
internet buyers, gender, marital status, residential location, age, education, and household income

were frequently found to be important predictors of internet purchasing (Fram & Grady, 1997;
Kunz, 1997; Mehta & Sivadas, 1995; Sultan & Henrichs, 2000). Further in a study conducted by
Internet and Mobile Association of India (IAMAI, 2006) in collaboration with cross tab marketing
services, clearly established the dominance of people-to-people (P2P) reference in online shopping
space, with 31% respondents finding such sites through word of mouth as much as 55% visitors to
e-commerce sites have adopted internet as a shopping medium, out of which 25% of regular
shoppers are in the 18-25 age group, while 46% in the 26-35 age group and 18% in the 35-45 age
group. Older online consumers have the sense of saving and purchasing while younger online
consumers have no experience and dont have enough maturity to buy goods with planned
spending (Rodriguez, 2009). In another survey conducted by Master Card worldwide (December
2008) on 5037 respondents across 10 markets: Australia, China, Hong Kong, India, Japan,
Singapore, South Korea, Thailand, UAE and South Africa projected that among all the markets
surveyed, India was the only one where the 18-29 year age group had the highest average spend
on online shopping. According to a study, Vaggelis Saprikis, Adamantia Chouliara and Maro
Vlachopoulou 2010, graduate students were the most receptive adoption category, as a high
percentage of them (80.4%) were using the internet in order to purchase online. Regarding the
years of internet activity, they were normally more experienced in using the Internet as they spent
much more hours daily in front of a personal computer or surfing the Net, explaining in a way that
their greater familiarity with computer technology leading them to being more receptive to
alternative methods of traditional shopping. Jain 2011 in his study indicated that income-wise
majority of the respondents came from the income groups of Rs.15000-Rs.30000 (35.7%), Rs.30,
000 -Rs.50, 000 (23.2percent) and above Rs.50, 000 (28.3percent). Only 12.8 percent of the
respondents in the sample belonged to families having income below Rs. 15000 thus supporting
the current study.
Table 3. Time Period of shopping online
Time Period for No. of Females (%) No. of Males (%) Total (%)
purchases/ (n = 45) (n = 55) (n = 100)
shopping
Less than a year 30 (67%) 23 (42%) 53 (53%)

1 to 5 years 12 (27%) 31(56%) 43 (43%)

More than 5years 3 (6%) 1(2%) 4 (4%)
Table 3 indicates that large number of subjects i.e., 53% have been shopping online for less than
a year, while 43% from one to five years and very small percentage i.e., 4% of the subject buying
online for more than 5 years. According to a study conducted by Bashir, 2013, showed similar
trends i.e., 53% of respondents made purchases online, out of which 41% of respondents were
shopping online for less than a year, 38% respondents were shopping since 1 to 5 years while 21%
had been shopping online for more than 5 years.
Table 4. Frequency of online shopping by consumers
Frequency of purchases No. of Females No. of Males Total

made online (%) (%) (%)
(n = 45) (n = 55) (n = 100)
Once a week or more 4 (9%) 4 (7%) 8 (8%)
Few times a month 3 (7%) 8 (15%) 11 (11%)
Once every month or two 8 (17%) 16 (29%) 24 (24%)
Once in six months 17 (38%) 14 (25%) 31(31%)
Once a year 13 (29%) 13 (24%) 26 (26%)
While finding out the frequency of online purchases made by consumers, it could be seen from
table 4 that 31% and 24% of the subjects shopped online once in six months and once in every
month or two respectively. Internet provides a big convenience for shopper as the main reason for
the shopping online has been agreed by most of researcher and customers (Wolhandler 1999).
Information technology has used in the form of the internet improved better quality of product
information, which help shoppers decision making (White 1997). In a similar study conducted by
Bashir, 2013 in Pakistan found that 47% of respondents had never bought online anything, while
23% of respondents bought things online once a year, 15% respondents bought online things once
in a month and same percentage lies under the category of respondents who bought at least once
in six months.

Table 5. Products usually purchased by the online buyers
Products purchased No. of Females (%) No. of Males (%) Total (%)
by Consumers (n = 45) (n = 55) (n = 100)
Clothing & Apparels 26 (58%) 32 (69%) 58 (58%)
Mobile Phones 17 (38%) 26 (47%) 43 (43%)
Books 21(47%) 11(20%) 32 (32%)
Music 0 7 (13%) 7 (7%)
Other 11 (24%) 11(20%) 22 (22%)
(grocery, cosmetics,
household appliances)
As seen from table 5, 58% of subjects purchased clothes, 43% mobile phones and 32% purchased
book, while 22% of buyers purchased items like grocery, cosmetics and other household
appliances. According the survey conducted by Master Card Worldwide Insights (2008), the
product and services most frequently bought online among Asia/Pacific online shopper were books
and art (41%), home appliances and electronic products (39%), CDs/DVDs/UCDs (38%) and
ladies clothing/accessories (38%).
Table 6. Preliminary survey in retail shop before making final online purchases
Visit Retail Shop before No. of Females (%) No. of Males Total
making online purchases (n = 45) (%) (%)
(n = 55) (n = 100)
Yes 17 (38%) 20 (36%) 37 (37%)
No 28 (62%) 35 (64%) 63 (63%)
Table 6 shows that 63% subjects did not visit any retail store before making final purchase from
online store.
Table 7. Opinion about shopping in a Retail Store v/s Shopping Online

Shopping from Retail Store No. of Females (%) No. of Males Total (%)
v/s Shopping Online (n = 45) (%) (n = 100)
(n = 55)
More Safe 15 (33%) 15 (28%) 30%
About the same 23(52%) 33(60%) 56%
Less Safe 2 (4%) 3 (5%) 5%
Dont Know 5 (11%) 4 (7%) 9%
With regard to Opinion of the online buyers regarding shopping online versus shopping in retail
store it was seen that (table 7) 56% respondents felt that shopping in store is about the same as
shopping online whereas 30% felt that shopping in store was safer. The results of a survey on 9700
online consumers showed that three out of five respondents did not trust web merchants (Belanger,
Hiller, & Smith, 2002). Apart from that, customer service affects purchase decisions through
vendor knowledge, responsiveness and reliability (Baker, Levy and Grewal, 1992;Gefen, 2002).
Jarvenpaa and Todd, 1996-97 in a study found that consumers do not have the opportunity to
physically inspect goods purchased over the internet prior to purchasing them. The concept of risk
is important for understanding how internet consumers make choices (Hasan and Rahim 2004).
Table 8. Problems and issues of shopping online
Problems and Issues of No. of Females (%) No. of Males (%) Total (%)
online buying (n = 45) (n = 55) (n = 100)
Security Issues 28 (62%) 24 (44%) 52 (52%)
Product Quality 27 (60%) 24 (44%) 51 (51%)
Low trust level 20 (44%) 15 (27%) 35 (35%)
Privacy Issues 14 (31%) 10 (18%) 24 (24%)
Warranty and Claims 8 (18%) 7 (13%) 15 (15%)
Value added Tax 6 (13%) 6 (11%) 12 (12%)
Service Quality 6 (13%) 4 (7%) 10 (10%)
Product delivery 4 (9%) 6 (11%) 10 (10%)

High Shipping Cost 5 (11%) 4 (7%) 9 (9%)

Dealers Unknown 3 (7%) 3 (5%) 6 (6%)
Refund Policy 3 (7%) 3 (5%) 6 (6%)
No Assistance 0 1(2%) 1 (1%)
There are many problems and issues related to online buying studied by many researchers
(Jarvenpaa and Todd, 1996-97, Belanger, Hiller, & Smith, 2002). Table 8 indicates 52% subjects
felt payment security issues, 51% subject felt not getting enough value for the money spent/
product quality, 24% subjects felt privacy issues as barriers which keep away the subjects from
shopping online. It has been reported that consumers have a low perception and trust of online
merchants, making them unwilling to make purchases online. The results of a survey of 9700
online consumers showed that three out of five respondents did not trust web merchants (Belanger,
Hiller, & Smith, 2002) Apart from that, customer service affects purchase decisions through
vendor knowledge, responsiveness and reliability (Baker, Levy, and Grewal, 1992;Gefen, 2002).
Internet purchases of tangible goods present unique challenges when compared with traditional
brick and mortar retail store purchases. Consumers do not have the opportunity to physically
inspect goods purchased over the internet prior to purchasing them (Jarvenpaa and Todd, 1996-
97). Instead, internet purchasers must rely on mediated representations of the goods being
purchased, are normally dependent on third parties for delivery of purchased goods and may
question the convenience of product returns. Lastly, the concept of risk is important for
understanding how internet consumers make choices (Hasan and Rahim 2004). Shopping
environments on the internet may be uncertain for the majority of online shoppers. The risk may
then be defined as the subjectively-determined expectation of loss by an online purchaser in
contemplating a particular online purchase. Amongst the identified perceived risk are financial,
product performance, social, psychological and time/ convenience loss. Financial risk stems from
paying more for a product than being necessary or not getting enough value for the money spent
(Roehl and Fesenmaier 1992). Know and Lee (2003) explored consumers concerns about payment
security and its relationship to online shopping attitude and actual purchases.

Table 9. Survey on websites by subjects before making the actual purchase online
Visit Online Store No. of Females (%) No. of Males (%) Total (%)
(n = 45) (n = 55) (n = 100)
Yes 31(69%) 36 (65%) 67 (67%)
No 14 (31%) 19 (35%) 33 (33%)
When studying about visiting other websites for comparisons before making actual purchases
online, 67% of respondents (Table 9) said that they visit other online stores before making actual
purchases. According to Leggatt (2010), a quarter of U.S. adults have increased the amount of time
they spend online shopping (24%) and reading product reviews (25%), found Harris Interactive's
online survey. The research shows that the internet has become a useful tool for comparison
shopping and users often click around various sites to view and compare the products, proceed to
leave the site altogether, and then, possibly, return days later to purchase a product, or they might
buy locally (Degeratu, Rangaswamy and Wu, 2000).Therefore, the Internet shopping allows
consumers more freedom to continuously visit and purchase products, even they leave without
making a purchase (Wolfinbarger and Gilly, 2001).
Conclusion:
There are many reasons for investigating on factors influencing consumers attitude towards online
shopping that can be considered important. From the marketers perspective, they will more
understand the attitude of the consumers towards online shopping as well as the factors influencing
consumers to make online purchases. From the result, it can be seen that online buying experiences,
product perception, safety of payment and customer service have significant effects on the attitude
towards online purchases through online shopping. Further, it can also be understood that the
consumers purchase items like clothes, book, mobiles and home appliances frequently. This
research can make the consumers aware that e-commerce is becoming an important trend in this
modern information technology society as you can reach and get the information and product
without actually reaching out physically to the places. As the population is on rise, cities are
overcrowded, commuting at peak hours becoming stressful due to heavy traffic, less time at
disposal, contribute to rise in online purchases.

Last but not least, this study is useful for the academicians where current study could serve as a
reference and may provide some guides for the future researchers who would like to study in detail
about the other aspects of online buying. The Internet is no longer a niche technology it is mass
media and an utterly integral part of modern life.

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Volume II, Issue IX, January 2015 - ISSN 2321-7065

Consumers Behaviour towards Online Purchases

Keywords: Online shopping, internet, barriers, consumer behaviour

Purpose of the study:

Objectives of the study:

Sample for the Shop online Do not shop Total

Factors affecting online shopping Total (%) (n = 100)

Table 3. Time Period of shopping online

1 to 5 years 12 (27%) 31(56%) 43 (43%)

Frequency of purchases No. of Females No. of Males Total

Table 5. Products usually purchased by the online buyers

Table 7. Opinion about shopping in a Retail Store v/s Shopping Online

Table 8. Problems and issues of shopping online

High Shipping Cost 5 (11%) 4 (7%) 9 (9%)

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