Youth satisfaction with online shopping in Shimla

Customer satisfaction in Online Shopping among youth of Shimla city
CUSTOMER SATISFACTION IN ONLINE

SHOPPING AMONG YOUTH OF SHIMLA CITY
A PROJECT REPORT
Submitted by
VISHAL SHARMA (2527)
in partial fulfillment for the award of the degree

of
MASTERS IN BUSINESS ADMINISTRATION
at
HP UNIVERSITY BUSINESS SCHOOL

HIMACHAL PRADESH UNIVERSITY
SHIMLA (HP)
JUNE 2014
HP University Business School, Shimla Page 1

DECLARATION
I, Vishal Sharma, hereby declare that the research project titled “Customer
satisfaction in online shopping among youth of Shimla city” submitted for the
award of MBA degree, is my original work and the project has not formed the
basis for the award of any degree, associate ship, fellowship or any other similar
titles. Any literature, data or works done by others and cited within this dissertation
has been given due acknowledgement and listed in the reference section.
Place: Shimla Vishal Sharma

Date: 30th June 2014 Roll No. 2527

CERTIFICATE
This is to certify that the project entitled “Customer Satisfaction in Online

Shopping Among Youth of Shimla city” is the bonafide work undertaken by
Vishal Sharma, a student of MBA (Marketing & HR), at Himachal Pradesh
University Business School, Shimla, during the year 2014, under my guidance in
partial fulfillment of the requirements for the award of the Degree of Masters in
Business Administration and that the project has not formed the basis for the award
previously of any degree, diploma, associate ship, fellowship or any other similar
title.
Dr. Shyam Lal Kaushal

Professor (Human Resource)
HP University Business School, Shimla
Place: Shimla
Date: 3rd July 2014

EXECUTIVE SUMMARY
This study endeavors to understand the customer satisfaction in online shopping among Youth of
Shimla city, while investigating the major reasons & factors which influence a customer’s
decision for purchasing online and the level of satisfaction achieved by him/her by making
online purchases.
Jarvenpaa and Todd (1996-97) propounded certain factors which were found to influences the
customer’s online purchase decision. These factors were chosen as the basis of framework of this
study to explain customer satisfaction in buying products online. The existing literature was
reviewed to discover reasons that would influence a customer’s behaviour positively or
negatively towards shopping online.
A Survey was conducted in various suburbs of Shimla city (Himachal Pradesh) by distributing
questionnaires to gather data for this research. Online questionnaires were also used.
MS Excel 2007 software package was used to store collected data, analyze it graphically and to
test the research hypothesis.
From the findings, it was discovered that the respondents used internet to purchase products
online owing to factors like Quality of products, Speed of delivery, Low prices, difference
between expected & real products, repurchases option, after sales services, customer care
services, easy online payments, returning/replacing, special discounts/offers, recommending
others to buy online and variety of choice available
Furthermore, the result of hypotheses established that the youth of Shimla city were overall
satisfied with their online shopping experience.
Finally, the study remained successful presenting positive results with respect to the satisfaction
level of Shimla youngsters towards online shopping.

ACKNOWLEDGEMENT
Through this section, I would like to thank all those who have helped in any way, odd or even, in
making this project successful.
I express my wholehearted gratitude to the Himachal Pradesh University Business School,

Shimla, for giving me this precious opportunity of undertaking a research project during my
final year of MBA in Marketing and HR.
I extend a very special thanks to Prof. Shyam Lal Kaushal, my project guide, for helping me
choose this topic, providing timely guidance, valuable support and encouragement at each &
every step throughout the compilation of this project.
I am highly thankful to my respected Maa-Papa and other family members for their support in
odd hours of compilation.
Last, but not the least; a very special thanks to Almighty, for remaining my guiding light
throughout the work and helping me complete this endeavor successfully.
VISHAL SHARMA

Contents
DECLARATION............................................................................................................................2
CERTIFICATE ..............................................................................................................................3
EXECUTIVE SUMMARY ...........................................................................................................4
ACKNOWLEDGEMENT .............................................................................................................5
1. INTRODUCTION ...............................................................................................................8
1.1 PROJECT OVERVIEW ................................................................................................... 9
1.2 ONLINE SHOPPING .................................................................................................... 10
1.3 ADVANTAGES OF ONLINE SHOPPING .................................................................. 14
1.4 DISADVANTAGES OF ONLINE SHOPPING............................................................ 15
1.5 IMPACT OF REVIEWS ON CONSUMER BEHAVIOUR ......................................... 16
1.6 ONLINE SHOPPING PORTALS IN INDIA ................................................................ 16
1.7 CUSTOMER SATISFACTION ..................................................................................... 19
1.8 FACTORS AFFECTING CUSTOMER SATISFACTION ........................................... 20
1.8.1 Quality..................................................................................................................... 20
1.8.2 Delivery time .......................................................................................................... 20
1.8.3 Low price ................................................................................................................ 20
1.8.4 Choice availability .................................................................................................. 20
1.8.5 After-sales service ................................................................................................... 21
1.8.6 Discounts/offers ...................................................................................................... 21
1.8.7 Payment options ...................................................................................................... 21
1.8.8 Expectation fulfillment ........................................................................................... 21
2. LITERATURE REVIEW ...................................................................................................22
2.1 ONLINE SHOPPING .................................................................................................... 23
2.3 FACTORS AFFECTING CUSTOMER SATISFACTION IN ONLINE SHOPPING . 25
3. RESEARCH DESIGN .........................................................................................................28
3.1 NEED OF THE STUDY ................................................................................................ 29
3.2 OBJECTIVES OF THE STUDY ................................................................................... 29
3.3 RESEARCH METHODOLOGY ................................................................................... 29
3.3.1 SOURCES OF DATA ............................................................................................ 30

3.3.2 SAMPLES............................................................................................................... 30
3.4 INSTRUMENTS USED ................................................................................................ 30
4. DATA ANALYSIS ...............................................................................................................31
4.1 DEMOGRAPHIC PROFILE OF THE YOUTH ........................................................... 32
4.2 ONLINE PRESENCE .................................................................................................... 33
4.3 BUYING BEHAVIOUR ................................................................................................ 34
4.4.1 The quality of products purchased online is highly satisfactory............................. 39
4.4.2 The speed of Delivery of products is fast ............................................................... 40
4.4.3 The products available online are priced low in comparison to traditional market 41
4.4.4 The difference between your expectations and real products would influence your
satisfaction level.................................................................................................................... 42
4.4.5 You will never repurchase from the same company if there is a great difference
between expected and the real product ................................................................................. 43
4.4.6 The after sales services offered by the company are highly satisfactory ................ 44
4.4.7 The customer care services offered are highly satisfactory .................................... 45
4.4.8 The process of making online payments is fast & easy .......................................... 46
4.4.9 There is no difficulty in returning/replacing the product bought online ................. 47
4.4.10 Online shopping, at times, provides eligibility to exciting discounts/offers........... 48
4.4.11 You will recommend & motivate your other friends to purchase online ............... 49
4.4.12 A variety of choice helps choosing the best in class from amongst various brands 50
4.4.13 You are overall satisfied with your experience of shopping online ........................ 51
4.5 TESTING OF HYPOTHESIS ........................................................................................ 52
5. CONCLUSION ....................................................................................................................55
5.1 FINDINGS ..................................................................................................................... 56
5.2 CONCLUSION .............................................................................................................. 58
REFERENCES .............................................................................................................................59
BIBLIOGRAPHY ........................................................................................................................62
ANNEXURE ................................................................................................................................64
QUESTIONNAIRE......................................................................................................................65

CHAPTER-1
INTRODUCTION
1.1 PROJECT OVERVIEW
1.2 ONLINE SHOPPING
1.2.1 HISTORY
1.2.2 E-COMMERCE STATASTICS
1.2.3 CUSTOMERS
1.2.4 LOGISTICS
1.2.5 PAYMENTS
1.2.6 PRODUCT DELIVERY
1.2.7 SHOPPING CART SYSTEM
1.3 ADVANTAGES OF ONLINE SHOPPING
1.3.1 CONVENIENCE
1.3.2 EASE OF EXCHANGE
1.3.3 INFORMATION AND REVIEWS
1.3.4 PRICE AND SELECTION
1.4 DISADVANTAGES OF ONLINE SHOPPING
1.4.1 FRAUD AND SECURITY CONCERNS
1.4.2 LACK OF FULL COST DISCLOSURE
1.4.3 PRICE
1.4.4 PRODUCT SUITABILITY
1.5 IMPACT OF REVIEWS ON CUSTOMER BEHAVIOUR
1.6 ONLINE SHOPPING PORTALS IN INDIA
1.7 CUSTOMER SATISFACTION
1.8 FACTORS AFFECTING CUSTOMER SATISFACTION

CHAPTER 1 – INTRODUCTION
1.1 PROJECT OVERVIEW
The main object of every organization is to maximize its profit. To achieve this object the
organization should increase its sales by getting more customer and the only way to get more
customer is that the organization should provide expected satisfaction to the customers.
Here the word customer satisfaction means “the utility which customer expect from the product”
and when a customer get expected utilities it is called as customer satisfaction.
Internet has transcended us from the traditional shopping era into a new and more efficient era of
online shopping. Globally, customers are gaining tremendous benefits from purchasing goods
and services from cyberspace. The internet permits the 24X7 and 365 days availability of goods
with little or no extra cost.
Surplus seeking consumers and retailers are always searching for markets that are more
economically efficient hence, online purchasing. Although there are abundant research works
undertaken relating to factors that influence customer satisfaction and purchase intention in the
context of online shopping (e-commerce), factors that are found to influence the level of
customer satisfaction actually vary from time-to-time & location-to-location.
In this research project, the findings of the questionnaire-based survey conducted in various
suburbs of Shimla city are analyzed with the purpose of drawing out conclusions as to what all
factors affect the level of customer satisfaction in online shopping among the youth of Shimla
city.
Shimla, popularly known as the Queen of Hills, is the capital city of Himachal Pradesh. One of
the most acclaimed hill station of the country, as per Census 2011, population of 1, 71,817
resides in Shimla city. With approximately 45% people between 18-30 age group, the
preferences of youth are required to be kept in mind.

1.2 ONLINE SHOPPING
Online shopping or e-shopping is a form of electronic commerce which allows consumers to

directly buy goods or services from a seller over the Internet using a web browser. Alternative
names are: e-web-store, e-shop, e-store, Internet shop, web-shop, web-store, online store, online
storefront and virtual store. Mobile commerce (or m-commerce) describes purchasing from an
online retailer's mobile optimized online site or app.
An online shop evokes the physical analogy of buying products or services at a bricks-and-
mortar retailer or shopping center; the process is called business-to-consumer (B2C) online
shopping. In the case where a business buys from another business, the process is called
business-to-business (B2B) online shopping. The largest of these online retailing corporations in
India are Flipkart.com, Amazon.com, Snapdeal.com, eBay.com, Shopclues.com, Myntra.com,
Homeshop18.com, Naaptol.com, Jabong.com etc.
Retail success is no longer all about physical stores. This is evident because of the increase in
retailers now offering online store interfaces for consumers. With the growth of online shopping,
comes a wealth of new market footprint coverage opportunities for stores that can appropriately
cater to offshore market demands and service requirements.
1.2.1 History
English entrepreneur Michael Aldrich invented online shopping in

1979. His system connected a modified domestic TV to a real-time
transaction processing computer via a domestic telephone line. He
believed that videotex, the modified domestic TV technology with a
simple menu-driven human–computer interface, was a new,
universally applicable, participative communication medium — the first since the invention of
the telephone.' This enabled 'closed' corporate information systems to be opened to 'outside'
correspondents not just for transaction processing but also for e-messaging and information
retrieval and dissemination, later known as e-business.

During the 1980s he designed, manufactured, sold, installed, maintained and supported many
online shopping systems, using videotex technology.
The first World Wide Web server and browser, created by Tim Berners-Lee in 1990, opened for
commercial use in 1991. Thereafter, subsequent technological innovations emerged in 1994:
online banking, the opening of an online pizza shop by Pizza Hut, Netscape's SSL v2 encryption
standard for secure data transfer, and Intershop's first online shopping system. Immediately
after, Amazon.com launched its online shopping site in 1995 and eBay was also introduced in
1995.
Following the great success of Amazon in international market, a team of two Indian
entrepreneurs launched a similar portal Flipkart.com (5th September 2007) which is today the
pioneer of Indian online shopping industry.
1.2.2 E-Commerce statistics
Statistics show that in 2012, Asia-Pacific increased their international sales over 30% giving
them over $433 billion in revenue. That is a $69 billion difference between the U.S. revenue of
$364.66 billion. It is estimated that Asia-Pacific will increase by another 30% in the year 2013
putting them ahead by more than one-third of all global ecommerce sales.
1.2.3 Customers
Online customers must have access to the Internet and a valid method of payment in order to
complete a transaction. Generally, higher levels of education and personal income correspond to
more favorable perceptions of shopping online. Increased exposure to technology also increases
the probability of developing favorable attitudes towards new shopping channels.
In a December 2011 study, Equation Research surveyed 1,500 online shoppers and found that
87% of tablet owners made online transactions with their tablet devices during the early
Christmas shopping season.

1.2.4 Logistics
Consumers find a product of interest by visiting the website of the retailer directly or by
searching among alternative vendors using a shopping search engine.
Once a particular product has been found on the website of the seller, most online retailers
use shopping cart software to allow the consumer to accumulate multiple items and to adjust
quantities, like filling a physical shopping cart or basket in a conventional store. A "checkout"
process follows (continuing the physical-store analogy) in which payment and delivery
information is collected, if necessary. Some stores allow consumers to sign up for a permanent
online account so that some or all of this information only needs to be entered once. The
consumer often receives an e-mail confirmation once the transaction is complete.
Less sophisticated stores may rely on consumers to phone or e-mail their orders (although full
credit card numbers, expiry date, and Card Security Code or bank account and routing number
should not be accepted by e-mail, for reasons of security).
1.2.5 Payments
Online shoppers commonly use a debit card, credit card or a PayPal account in order to make
payments. However, some systems enable users to create accounts and pay by alternative means,
such as:
 Cash on delivery (C.O.D)

 Cheque/ Check
 Debit card
 Credit card
 Direct debit in some countries
 Electronic money of various types
 Gift cards
The financial part of a transaction may be processed in real time (e.g. letting the consumer know
their credit card was declined before they log off), or may be done later as part of the fulfillment
process.

1.2.6 Product delivery
Once a payment has been accepted, the goods or services can be delivered in the following ways:
 Downloading/Digital distribution: The method often used for digital media products such
as software, music, movies, or images.
 Drop shipping: The order is passed to the manufacturer or third-party distributor, who
then ships the item directly to the consumer, bypassing the retailer's physical location to
save time, money, and space.
 In-store pick-up: The customer selects a local store using locator software and picks up
the delivered product at the selected location. This is the method often used in the bricks
and clicks business model.
 Printing out, provision of a code for, or e-mailing of such items as admission
tickets and scrip (e.g., gift certificates and coupons). The tickets, codes, or coupons may
be redeemed at the appropriate physical or online premises and their content reviewed to
verify their eligibility (e.g., assurances that the right of admission or use is redeemed at
the correct time and place, for the correct dollar amount, and for the correct number of
uses).
 Shipping: The product is shipped to a customer-designated address.
1.2.7 Shopping cart systems
 Simple systems allow the off-line administration of products and categories. The shop is
then generated as HTML files and graphics that can be uploaded to a webspace. The
systems do not use an online database.
 A high-end solution can be bought or rented as a stand-alone program or as an addition to
an enterprise resource planning program. It is usually installed on the company's
webserver and may integrate into the existing supply chain so that ordering, payment,
delivery, accounting and warehousing can be automated to a large extent.
 Other solutions allow the user to register and create an online shop on a portal that hosts
multiple shops simultaneously from one back office.
 Commercial systems can also be tailored so the shop does not have to be created from
scratch.

1.3 ADVANTAGES OF ONLINE SHOPPING
1.3.1 Convenience
Online stores are usually available 24 hours a day, and many consumers have Internet access
both at work and at home.
1.3.2 Ease of exchange

In the event of a problem with the item (e.g., the product was not what the consumer ordered, the
product was not satisfactory), consumers are concerned with the ease of returning an item in
exchange for either the correct product or a refund. Consumers may need to contact the retailer,
visit the post office and pay return shipping, and then wait for a replacement or refund.
1.3.3 Information and reviews
Online stores must describe products for sale with text, photos, and multimedia files, whereas in
a physical retail store, the actual product and the manufacturer's packaging will be available for
direct inspection (which might involve a test drive, fitting, or other experimentation).
Some stores even allow customers to comment or rate their items. There are also
dedicated review sites that host user reviews for different products. Reviews and even some
blogs give customers the option of shopping for cheaper purchases from all over the world
without having to depend on local retailers.
1.3.4 Price and selection
One advantage of shopping online is being able to quickly seek out deals for items or services
provided by many different vendors (though some local search engines do exist to help
consumers locate products for sale in nearby stores). Search engines, online price comparison
services and discovery shopping engines can be used to look up sellers of a particular product or
service.
Shipping costs (if applicable) reduce the price advantage of online merchandise, though
depending on the jurisdiction, a lack of sales tax may compensate for this.

1.4 DISADVANTAGES OF ONLINE SHOPPING
1.4.1 Fraud and security concerns
Given the lack of ability to inspect merchandise before purchase, consumers are at higher risk of
fraud than face-to-face transactions. Merchants also risk fraudulent purchases using stolen credit
cards or fraudulent repudiation of the online purchase. However, merchants face less risk from
physical theft by using a warehouse instead of a retail storefront.
1.4.2 Lack of full cost disclosure
The lack of full cost disclosure may also be problematic. While it may be easy to compare the
base price of an item online, it may not be easy to see the total cost up front. Additional fees such
as shipping are often not be visible until the final step in the checkout process. The problem is
especially evident with cross-border purchases, where the cost indicated at the final checkout
screen may not include additional fees that must be paid upon delivery such
as duties and brokerage.
1.4.3 Privacy
Privacy of personal information is a significant issue for some consumers. Many consumers wish
to avoid spam and telemarketing which could result from supplying contact information to an
online merchant. In response, many merchants promise to not use consumer information for
these purposes.
1.4.4 Product suitability
Some non-digital products have been more successful than others for online stores. Products less
suitable for e-commerce include products that have a low value-to-weight ratio, products that
have a smell, taste, or touch component, products that need trial fittings—most notably
clothing—and products where colour integrity appears important. Nonetheless, some web sites
have had success delivering groceries and clothing sold through the internet is big business in the
India.

1.5 IMPACT OF REVIEWS ON CONSUMER BEHAVIOUR
One of the great benefits of online shopping is the ability to read product reviews, written either
by experts or fellow online shoppers.
The Nielsen Company conducted a survey in March 2010 and polled more than 27,000 Internet
users in 55 markets from the Asia-Pacific, Europe, Middle East, North America, and South
America to look at questions such as "How do consumers shop online?", "What do they intend to
buy?", "How do they use various online shopping web pages?", and the impact of social
media and other factors that come into play when consumers are trying to decide how to spend
their money on which product or service. According to the research, reviews on electronics
(57%) such as DVD players, cellphones, or PlayStations, and so on, reviews on cars (45%), and
reviews on software (37%) play an important role in influencing consumers who tend to make
purchases online. Furthermore, 40% of online shoppers indicate that they would not even buy
electronics without consulting online reviews first.
In addition to online reviews, peer recommendations on online shopping pages or social media
websites play a key role for online shoppers when they are researching future purchases. 90% of
all purchases made are influenced by social media. Each day, over two million buyers are
shopping online for jewelry.
1.6 ONLINE SHOPPING PORTALS IN INDIA
With the advent of e-commerce technology in India, Online shopping has become a most-liked
trend. People have been enjoying the convenience of having their order shipped right to their
doorstep. But people often get confused in selection of reliable sites as there are a plethora of
sites, and everyone claims to be reliable. But in actual only few are up to the mark. Thus, on the
basis of customer review, top 11 online shopping sites in India are:
1.6.1 Flipkart
Flipkart.com is the market leader in Online shopping in our country. Here you can buy almost
everything ranging from books, bags, toys, baby care, belts, watches, television, cell phones to

refrigerators, hard drives, motorcycles, air conditioners, and a lot of various items. Here you can
get easy discounts, coupons and many other deals which will keep you buying from Flipkart.
1.6.2 Ebay
The world leader in online shopping store has stamped its mark in India also. EBay is a shopping
store in which a wide variety of goods, services and products are bought and sold. EBay sells
fresh new products along with used products. It sometimes holds up auction for some products
also. EBay and Flipkart are on a neck to neck competition for becoming the best online shopping
site in India.
1.6.3 Snapdeal
Snapdeal is one of India’s largest e-commerce website with respect to the number of transactions
in a single day. Products such as watches, hard drives, laptops, and computers can be bought at a
very cheap price. It provides some heavy discounts on its items. Operating in only a few cities
but the transaction rate is very high. It ranks amongst the top players in best online shopping sites
in India.
1.6.4 Shopclues
Shopclues is an amazing online shopping store to buy products. Shopclues, famous for its Jaw
Dropping Deals, provides commodities at an extremely cheap price. It offers wide variety of
goods such as cameras, cosmetics, pendrives etc.
1.6.5 Myntra
Recently taken over by Flipkart, Myntra aims at redefining the fashion mantra of Indians. It
offers fashion products such as T-shirts, jeans, watches, shoes, belts and other accessories.
1.6.6 Naaptol
Naaptol.com allows its customers to avail various options for a particular product. This website
is amongst the most popular online shopping sites in India. The name itself means comparison
before buying any product. The details of the products are displayed to the customer, leaving
behind no confusion in the minds of its customer.

1.6.7 Homeshop18
This website contains a range of kitchen appliances, household products, laptops, shoes, gifts etc.
Homeshop18. Owned by Network18, a television and a media marketing company, Homeshop18
is the first company to launch its 24 x 7 open Home shopping TV channel. This website has been
awarded the “Best Shopping Site” by PC World Magazine in 2008. Because of its advertisement,
the popularity has been rising to new peaks. It is also becoming one of the strongest contenders
for best online shopping sites in India.
1.6.8 Jabong
This site is gaining popularity day by day because of its efficient work process and availability of
number of branches in most parts of the country. Soon it will be in race amongst the present best
online shopping sites in India.
1.6.9 Tradus
Tradus is a Europe-based online shopping store which provides variety of online products and
commodities. Shipping is done for free but only to a few parts of the country. Discounted prices
of products are available in this website.
1.6.10 Yebhi
Yebhi is also referred as the “Online Apparel Store of India”. This website provides a wide
collection of apparels, bags, jewelry. Yebhi is the undisputed king of Online Apparel in India.
Lucrative prices along with discounts makes the customers buy in this shopping store.
1.6.11 Buytheprice
Shop Online – Buy Mobile Phones, Laptops, Digital Cameras, MP3 Players, TVs and Hard
Disks + Free Shipping. An interesting feature about this website is that the prices of the products
go on decreasing if more and more people buy them. The price of the book goes down from 400
to 300 if instead of a single person, 10 people buy it. The customers can take profitable
advantage of this option.

Customer satisfaction is a term frequently used in marketing. It is a measure of how products

and services supplied by a company meet or surpass customer expectation. Customer satisfaction
is defined as "the number of customers, or percentage of total customers, whose reported
experience with a firm, its products, or its services (ratings) exceeds
specified satisfaction goals.”
Customer is the King
According to Business Dictionary, it is defined as “the degree of satisfaction provided by

the goods or services of a company as measured by the number of repeat customers.”
Customer satisfaction is the outcome felt by buyers who have expectation. Customers are
satisfied when their expectation are met and delighted when their expectations are exceeded.
Satisfied customers remain loyal longer, buy more, and are less sensitive and talk favorable
about the company. From this it is clear that the satisfied customer will be less sensitive towards
the fluctuating price and offensive marketing typically cost more than defensive marketing,
because it requires much effort and cost to induce satisfied customers to switch away from their
current suppliers.
We should also consider the fact that "the cost of attracting a new customer may be five times the
cost of keeping the current customer happy." Therefore the companies are intending in
developing stronger bones and loyalty with their customers.
It is seen as a key performance indicator within business and is often part of a Balanced
Scorecard Method of strategy design. In a competitive marketplace where businesses compete
for customers, customer satisfaction is seen as a key differentiator and increasingly has become a
key element of business strategy.
Therefore, it is essential for businesses to effectively manage customer satisfaction. To be able

do this, firms need reliable and representative measures of satisfaction.

1.8 FACTORS AFFECTING CUSTOMER SATISFACTION
Various factors affect the customer satisfaction levels in online shopping. Mentioned below are
some factors based on the Customer satisfaction model propounded by Jarvenpaa and Todd
(1996).
1.8.1 Quality
The quality of products plays a very important role in the level of satisfaction active by him/her
by usage of that product. If the quality of product is satisfactory, the buyer will definitely
recommend the product to others and at the same time prefer purchasing the same product to
satisfy his/her needs next time.
1.8.2 Delivery time

The time taken by the seller of product to deliver the product to the final customer is called the
delivery time for that product. The delivery time taken by the vendor decides the level of
satisfaction the customer will attain buying the product. Quick action approach is expected as a
part of increasing sales in online selling nowadays. Lesser is the delivery time, more is the level
of satisfaction achieved by the customer.
1.8.3 Low price

Price is another important factor of the strategy of marketing of a product. Price is defined as the
cost born by the customer in acquiring the product. The price of the product keeps on increasing
at every step as it passes on from the production unit to the factory warehouse to distributor to
wholesaler and finally to the retailer. Whereas in case of online shopping, the cost is low because
the product is sent directly from the manufacturer to customer.
1.8.4 Choice availability

There is a wide range of products available for shopping online as there is no need of stocking
and as soon as the order is received, it can be directly sent from the manufacturer to the
customer. Hence, the customer gets a wide range of choice to buy from the virtual products
available online.

1.8.5 After-sales service
After-sales services are highly important to retain the customer for life long association. The
better the after sales services & customer care, better is the customer satisfaction.
1.8.6 Discounts/offers
Shopping online also provides eligibility to various discounts and offers on other purchases from
the same web portal. Buying a single product offers discount on the purchase of additional
related or diverse products. Come coupon codes can be used on next purchase to avail the
discount. Offers like free shipping & free product are also given to lure the customers. Such
offers are not available if the product is bought at a retail outlet.
1.8.7 Payment options

Availability of various payment options like Cash on Delivery provides an opportunity to buy the
product even if you don’t have cash right now as the payment is to be made once the product is
received. Some vendors also provide an opportunity to test and try the product and then make the
payment only when the customer is fully satisfied with the quality.
1.8.8 Expectation fulfillment

Before buying a product, the customer has some expectations which he wants the product to
fulfill. It is only if the product fulfills the expectations that it is able to satisfy the customers.
Customer is considered to be the king. Whatever he asks for; needs to be fulfilled. That’s how
customer satisfaction achieved.

CHAPTER-2
LITERATURE REVIEW
2.1 ONLINE SHOPPING
2.3 FACTORS AFFECTING CUSTOMER SATISFACTION IN
ONLINE SHOPPING

CHAPTER 2 – LITERATURE REVIEW
2.1 ONLINE SHOPPING
R. L. Kenney (1999) states Online Shopping is the conduct of business via internet which relates
to activities of information searching, information sharing, purchasing or exchanging products
and services; also maintaining customer relationship without face to face meeting unlike
transaction done in traditional way. Often online shopping is wrongfully perceived as a way of
doing business between web retailers and web end customers but rather e-commerce
encompasses an entire range on conducting online business whether it’s the interaction between
business to business, business to customer, and business to government.
According to UCLA Center for Communication Policy (2001), online shopping has become
the third most popular Internet activity, immediately following e-mail using/instant messaging
and web browsing. It is even more popular than seeking out entertainment information and news,
two commonly thought of activities when considering what Internet users do when online. Of
Internet users, 48.9 percent made online purchases in 2001, with three-quarters of purchasers
indicating that they make 1-10 purchases per year.
Liang and Lai (2000) state that online shopping possesses five steps similar to those associated
with traditional shopping behavior. In the typical online shopping process, when potential
consumers recognize a need for some merchandise or service, they go to the Internet and search
for need-related information. However, rather than searching actively, at times potential
consumers are attracted by information about products or services associated with the felt need.
They then evaluate alternatives and choose the one that best fits their criteria for meeting the felt
need. Finally, a transaction is conducted and post-sales services provided. Online shopping
attitude refers to consumer's psychological state in terms of making purchases on the Internet.
According to Kotler & Keller (2009), a buyer goes through five stages while making a decision
to purchase. These stages are best explainable when a buyer goes for buying costly items, such as
a house, a car, diamond jewelry etc. However, in day- to- day purchase, consumers may not go
through all these stages, since some commodes do not need information, and based on buyer’s
previous experience they will visit a store for the purchase. These stages are (Figure 1): “problem

recognition, information search, evaluation of alternatives, purchase decision, and purchase
behaviour”.
Tse and Wilton, (1988) & Oliver (1999) define Customer satisfaction is defined as an
"Evaluation of the perceived discrepancy between prior expectations and the actual performance
of the product".
Hennig-Thurau and Klee (1997) states Satisfaction of customers with products and services of
a company are considered as most important factor leading toward competitiveness and success.
Customer satisfaction is actually how customer evaluates the ongoing performance.
According to Kim, Park and Jeong (2004) customer satisfaction is customer’s reaction to the
state of satisfaction, and customer’s judgment of satisfaction level. Customer satisfaction is very
important in today’s business world as according to Deng et al., (2009) the ability of a service
provider to create high degree of satisfaction is crucial for product differentiation and developing
strong relationship with customers.
Eshghi, Haughton and Topi (2007) state that previous researchers have found that satisfaction
of the customers can help the brands to build long and profitable relationships with their
customers. Though it is costly to generate satisfied and loyal customers but that would prove
profitable in a long run for a firm. Therefore a firm should concentrate on the improvement of
service quality and charge appropriate fair price in order to satisfy their customers who would
ultimately help the firm to retain its customers.
Customer’s involvement is also important as when buyer consider the product important and
invests time to seek information then it ultimately enhances the satisfaction level (Russell-
Bennett, McColl-Kennedy and Coote, 2007). This satisfaction may influence the concerned
company by repurchase, purchase of more products, positive word of mouth and willingness of
customer to pay more for the particular brand. Any business is likely to lose market share,
customers and investors if it fails to satisfy customers as effectively and efficiently as its
competitors is doing (Anderson, Fornell, and Mazvancheryl, 2004).

2.3 FACTORS AFFECTING CUSTOMER SATISFACTION IN ONLINE
SHOPPING
There have been intensive studies of online shopping attitudes and behavior in recent years. Most
of them have attempted to identify factors influencing or contributing to online shopping
attitudes and behavior. The researchers seem to take different perspectives and focus on different
factors in different ways.
L. C. Schaupp and F. Bélanger (2005) state that it is imperative to be able to measure customer
satisfaction in the context of e-commerce since this will define the success of the vendors. The
literature suggests each research is different mainly by the antecedent factors of customer
satisfaction since the researchers chose the variables and factors best suit for each circumstance
in their perception; thus, the results are varied by time and location.
Jarvenpaa and Todd (1996-97) propounded that the purchase perceptions or factors influencing
online consumer’s purchase decision were grouped into three clusters including:
1) Product understanding (Product Perception): Price, Product Quality, and Product variety
2) Shopping Experience: Attributes of time, Convenience, and Product availability, Effort,

Lifestyle Compatibility and Playfulness or enjoyment of shopping process.
3) Customer service: Vendor responsiveness, Assurance and Reliability.
Youngsters with experience were more likely to be influenced by Product perception and the
Shopping experience more than Customer service and Consumer risk.
This result is consistent with Jarvenpaa & Todd (1996-97) referring that the sellers should
focus on product perception and shopping convenience when building the website. Out of other
factors, product perception is considered as the most important among students with higher
computer skill levels since they are greatly influenced by price and quality of products.
Christian & France (2005) proves that customers satisfied the most were privacy (Technology
factor), Merchandising (Product factor), and convenience (Shopping factor); also followed by
trust, delivery, usability, product customization, product quality and security. Surprisingly,

security was chosen as the last choice comparing to others. This was assumed that security is
perceived as a standard attribute in any websites so other attributes take priority once customers
have to choose the site to shop from.
Case, Burns, and Dick (2001) suggest that internet knowledge, income, and education level are
especially powerful predictors of Internet purchases among university students according to an
online survey of 425 U.S. undergraduate and MBA students. Ho and Wu (1999) discover that
there are positive relationships between online shopping behavior and five categories of factors,
which include e-store, logistical support, product characteristics, websites, technological
characteristics, information characteristics and homepage presentation.
David J. Reibstein (2002) has studied about factors attracting customers to the site and factors
being able to retain customers by mainly considering the role of price. Interestingly, e-shopping
site using low prices or price promotions to attract customers do mostly tend to draw price-
sensitive customers who are well known as having low loyalty. Factors’ motivating the
youngsters to shop the commodity product in the cyber-shop examined includes fashion
statement, demographic, price, choice & reviews by other friends.
On the other hand, convenience factor is consistent with the research of Eyong and Sean (2002),
“Designing Effective cyber store user interface”. The factors significant in this study are
1) Convenient and dependable shopping - Convenience, Guaranteed delivery, Secure transaction

mechanism.
2) Retailer Reliability – Dependable product, Competitive price, Store Policy.
3) Additional Information availability – Information of the online store, Production, Promotion,

Other customers’ testimonials, frequently asked questions (FAQs) section.
4) Tangibility and variety of merchandise – Proper size of picture of merchandise, a good quality
picture of merchandise, what’s new section, Broad product variety.
The online retailers do need to clearly state about the guarantee of on-time delivery and risk-free,
hassle-free return in their websites. Also, following what they promise to the customers will

notably increase the satisfaction. A clear explanation of specific policies will satisfy customer
better and trust the site.
Panakul (2001) and Chulathummakul et al. (2000) found that Product quality is counted as
the first priority in stimulating online purchase in Indians, Product Perception which comprises
of Variety and Price.
After a thorough review of literature available on the factors affecting the level of customer
satisfaction in online shopping, it was found that with respect to the field of study to be
considered here, the work will mainly be based on the study of S. L. Jarvenpaa and P. A.
Todd, “Consumer reactions to electronic shopping on the World Wide Web,” International
Journal of Electronic Commerce, pp. 59-88, (1996).
In order to particularly discover the influence of each antecedent factor, the research model is
designed to study the influence of each attribute separately.

CHAPTER-3
RESEARCH DESIGN
3.1 NEED FOR THE STUDY
3.2 NEED FOR THE STUDY
3.3 RESEARCH METHODOLOGY
3.3.1 SOURCES OF DATA
2.3.1.1 PRIMARY SOURCE
2.3.1.2 SECONDARY SOURCES
3.3.2 SAMPLES
3.4 INSTRUMENTS USED

CHAPTER 3 – RESEARCH DESIGN
3.1 NEED OF THE STUDY
Online shopping has become a unique and easy to use way of buying all types of products online
at just one click. Internet banking, debit cards & cash on delivery have made buying online a
great experience.
In a hill station like Shimla, though there is an eminent presence of multi-brand retail outlets of
world –renowned brands, but still, variety & choice of products in different genres remains
missing. Today’s youth is quiet fashion conscious and wishing to experiment with all types of
available choices of brands. The unavailability of choice diverts his/her attention to online
shopping where wide range of choice is available at different prices.
The need for this study hence arose to determine the approximate level of satisfaction attained by
the youth of Shimla city in their online shopping activity.
3.2 OBJECTIVES OF THE STUDY
The present research work is designed to achieve the following specific objectives:-
 To study the level of customer satisfaction in online shopping among the youth of Shimla
city.
 To study the impact of online presence & buying behaviour of Shimla youth on level of
customer satisfaction.
 To find out which e-commerce portal has highest customer base among youth of Shimla
city.
3.3 RESEARCH METHODOLOGY
The present study has been carried out to study the level of customer satisfaction in online
shopping among the youth of Shimla city.

3.3.1 SOURCES OF DATA
The study is based on both primary and secondary sources.
3.3.1.1 Primary source

The primary study was conducted in various suburbs of Shimla, capital city of Himachal
Pradesh. The sample of 100 youth has been randomly selected from localities in places like
Kasumpti, Pathaghati, New Shimla, Chotta Shimla, Sanjauli, Summerhill, Himland, Totu, Lower
Bazaar, Lakkar Bazaar, & Chaura Maidan. In order to obtain the required information, a well
designed questionnaire was administered to potential respondents through Offline & Online
media. The questionnaire covered different aspects of youth categorized in four genres namely
demographic information, online presence, buying behaviour & customer satisfaction. The
information thus collected was analyzed with the help of proficient statistical tools and
techniques.
3.3.1.2 Secondary source

The secondary data was collected after a thorough study of different research papers that have
been published on the similar topics. Various Research & educational websites, National and
International Surveys that have been conducted earlier were also used to frame the questionnaire.
3.3.2 SAMPLES
 Sampling Technique
Random sampling technique has been used.
 Sampling Area
Sampling area is Shimla city.
 Sampling Unit
Sampling units are localities in places like Kasumpti, Pathaghati, New Shimla, Chotta
Shimla, Sanjauli, Summerhill, Himland, Totu, Lower Bazaar, Lakkar Bazaar, & Chaura Maidan.
 Sample Size
A sample of 100 youth has been taken for the purpose of study.
3.4 INSTRUMENTS USED
The instruments used for calculations are MS Excel 2007 etc.

CHAPTER-4
DATA ANALYSIS
4.1 DEMOGRAPHIC PROFILE OF THE YOUTH
4.2 ONLINE PURCHASE
4.3 BUYING BEHAVIOUR

CHAPTER 4 – DATA ANALYSIS
4.1 DEMOGRAPHIC PROFILE OF THE YOUTH
In order to collect the information to analyze the level of customer satisfaction in online
shopping among youth of Shimla, a questionnaire-based survey was conducted. The
demographical characteristics of respondents were collected keeping in view the six variables
such as gender, age, education level, current occupation, income per year and background. The
sample units were selected on the basis of convenience and judgment sampling methods.
Table-1 makes it clear that the respondents were 65% males and 35% females in the age group of
Under 18 (3%), 18-24 (78%), 25-30 (17%) and Above 30 (2%). The majority of respondents
were students (62%) with highest qualification as graduates (55%) and from urban background
(65.4%).
Table-1 Demographic profile of the sample (N=100)

ITEMS PARTICULARS FREQUENCY PERCENTAGE
Male 65 65
GENDER
Female 35 35
Under 18 3 3
18-24 78 78
AGE
25-30 17 17
Above 30 2 2
8th Grade or Less 0 0
Higher Secondary 0 0
HIGHEST FORMAL Senior Secondary 4 4
EDUCATION Graduation 55 55
Post Graduation 40 40
Doctorate (Ph. D) 1 1
Student 62 62
Public Sector 7 7
Self-employed 3 3
CURRENT
Professional 24 24
OCCUPATION
Retired 0 0
Housewife 2 2
Others 2 2
Less than Rs. 50,000 47 47
Rs. 50,000-Rs. 2,00,000 18 18
TOTAL INCOME
Rs. 2,00,000-Rs. 4,00,000 20 20
PER YEAR
Rs. 4,00,000-Rs. 10,00,000 10 10
Greater than Rs. 10,00,000 5 5
Rural 32 32
BACKGROUND
Urban 68 68

4.2 ONLINE PRESENCE
4.2.1 Table-2 Online Presence

1. Do you have easy access to Internet?
Yes 95
No 5
2. Which device do you use for accessing Internet?
Laptop 49
PC 6
Cyber Café 0
Simple Cellphone 6
Smart Phone 39
3. How much time do you spend on internet every day?
Less than 1 hour 14
1-2 hours 24
2-4 hours 39
5-8 hours 12
More than 8 hours 11
4. What is your main objective behind internet usage?
Social Networking 32
Accessing E-mail 8
Education/Research 26
Surfing 18
Online Shopping 6
Work/Business 10
5. What Mode of Payment do you use for making Online Payments?
Debit Cards 56
Credit Cards 14
Internet Banking 23
Paypal 7
Table-2 above shows the online presence of the respondents wherein 95% respondents stated
that they have very easy access to internet. A maximum of 49% respondents stated that they
accessed internet through their Laptop followed by 39% who used smartphones to access
internet. A highest number of respondents (39%) used internet daily for 2-4 hours. The main
objective of internet usage was found to be Social networking with 32% respondents choosing
the same followed by Online shopping (26%) & education/Research (18%). Debit cards were
selected as the most preferred mode of online payment with 56% responses.

4.3 BUYING BEHAVIOUR
The buying behaviour of the customers was studied through a specialized section in the
questionnaire based on six questions. Each question mentioned below depicts the behaviour of a
customer while buying a product online.
4.3.1 Are you aware of the Concept of Online Shopping? (N=100)

YES 97 NO 3
120
100 97%
80
60
40
20
3%
0
Yes No
Figure 1 Awareness regarding Online Shopping
The Figure 1 above clearly depicts that from amongst a sample of 100 respondents, 97% were
aware of the concept of online shopping. This simply explains the level of awareness regarding
Online shopping among the youth of Shimla city. The youth is very much aware of the concept
and hence goes for online shopping owing to a number of inherent advantages.

4.3.2 How often do you shop online? (N=100)
Twice a Week 2
Once a Week 9
Fortnightly 4
Monthly 39
Bi-Monthly 11
Once in Six Months 35
Frequency of Online shopping
2
9
4
Twice a week
39 Once a week
Fortnightly
Monthly
Bi-monthly
35
Once in six months
11
Figure 2 Frequency of Online Shopping
The Figure 2 above clearly depicts that from amongst a sample of 100, highest number of
respondents (39%) purchased online at least once in a month. This high frequency level of online
purchases makes it clear that the youth of Shimla city are very much interested in online
purchasing and hence undertake online shopping at least once a month. The availability of vast
choice and convenience make online shopping a preferred trend amongst youth.

4.3.3 Why you prefer Online Shopping over Retail Shopping? (N=100)
Convenient 21 Consumer reviews 8
Low Price 21 Guarantee/Warrantee 0
Time Saving 22 After sales services 1
Wide range of choice 27
Preference for Online Shopping
Convenient
Low Price
Time Saving
Wide range of choice
Consumer reviews
Guarantee/warrantee
After sales services
Figure 3 Preferences for Online Shopping
The Figure 3 above clearly depicts that from amongst a sample of 100; there is a neck to neck
rating for the factors which motivate the buyers to purchase online. 27% respondents said they
prefer online shopping because of the wide range of choice available. Whereas, 22% said online
shopping is time saving followed by a rating 21% each for convenience & low price. The
fashion-freak youth prefers to choose from a wide range of choice available which is missing in
normal retail outlets. Hence, they prefer online shopping over traditional shopping. Online
shopping is time saving, convenient & available at low price. Hence, online shopping is
preferred by youth over traditional shopping.

4.3.4 Which web portal do you prefer for Online Shopping? (N=100)
FlipKart.com 39
Ebay.in 7
Amazon.in 8
Snapdeal.com 16
Shopclues.com 0
Myntra.com 20
HomeShop18.com 4
Naaptol.com 0
Jabong.com 6
Tradus.in 0
Most preferred Online Shopping Portal

0
0
Flipkart
6
4 E-Bay
Amazon
39 Snapdeal
20
Shopclues
Myntra
0 Homeshop18
Naaptol
16
Jabong
7
8 Tradus
Figure 4 Most Preferred Online Shopping Portal
The Figure 4 above clearly depicts that from amongst a sample of 100; maximum number of
youngsters (39%) prefers Flipkart.com to fulfill their online shopping needs followed by
Myntra.com (20%) which plays the role of market challenger. With the recent acquisition of
Myntra.com by Flipkart.com, as per this survey, the total market share of Flipkart become 59%
which makes it the undisputed market leader of Online Shopping market.
Thus, the survey helps determine that Flipkart.com is the most preferred Online Shopping
Portal among the youth of Shimla city.

4.3.5 What sort of products do you prefer buying online? (N=100)
Books 12
Clothing/Footwear 50
Electronic Gadgets 28
Household Items 2
Cosmetics 1
Sports/Fitness 2
Toys 1
Furniture 0
Others 4
Products bought online

60
50
50
40
28
30
20 12
10 2 2 4
1 1 0
0
Figure 5 Products bought Online
The Figure 5 above clearly depicts that from amongst a sample of 100; maximum number of
youngsters (50%) prefers to buy Clothing/Footwear online followed by Electronic gadgets (28%)
& books (12%). The fashion statement of Shimla youth is hence based on the online purchasing
of clothing/footwear as wide variety of branded products is available at comparable prices.

The entire research study was undertaken with the aim of determining the level of customer
satisfaction based certain factors that affect the customer satisfaction in online shopping gathered
by detailed literature review. The questionnaire consisted of 14 questions based on a study model
propounded by Jarvenpaa and Todd (1996-97).
Likert scale was used to make the analysis more effective & authentic.
The detailed analysis of the responses received for each question asked is presented and analyzed
below.
4.4.1 The quality of products purchased online is highly satisfactory

Response Strongly Agree Agree Neutral Disagree Strongly Disagree
Frequency 16 55 25 2 2
60
55
50
40
30
25
20 16
10
2 2
0
Strongly Agree Agree Neutral Disagree Strongly Disagree
Figure 6 Responses for Quality of Products
INFERENCE: The Figure 6 above clearly depicts that from amongst a sample of 100;
maximum number of respondents (55%) Agree with the fact that they are highly satisfied with
the Quality of products that they buy Online.

4.4.2 The speed of Delivery of products is fast
12 59 24 4 1
70
59
60
50
40
30
24
20
12
10
4
1
0
Figure 7 Responses on Delivery Speed
INFERENCE: The inference drawn from Figure 7 states that with respect to the speed of
delivery of the products, 59% respondents Agree to the fact that the Speed of delivery of the
products is fast. 24% respondents are neutral to the speed of delivery of products purchased
online whereas, 12% Strongly Agree to the fact that speed of delivery is fast.

4.4.3 The products available online are priced low in comparison to traditional
market
16 55 25 2 2
60
55
50
40
30 28
20
15
10
2
0
0
Figure 8 Responses for Low Price of Online products
INFERENCE: The inference drawn herein from Figure 9 states that taking into consideration
the cost of products purchased online, the cost is much lower as compared to the traditional
market. 55% respondents Agree to the fact that the cost of products purchased online is lesser
than those purchased from retail outlet. 28% respondents are neutral to the cost of products
purchased online, whereas, 15% Strongly Agree to the fact that cost of products purchased online
in low.

4.4.4 The difference between your expectations and real products would influence
your satisfaction level
20 51 29 0 0
60
51
50
40
29
30
20
20
10
0 0
0
Strongly Agree Agree Neutral Disagree Strongly
Disagree
Figure 9 Responses for difference between your expectations and real products
INFERENCE: The inference drawn from Figure 9 states that studying the impact the difference
between expectations and real product will have on customer satisfaction, 51% respondents
Agree to the fact that their level of satisfaction towards online shopping would be negatively
affected if there is a difference between their expectations and the actual real product received by
them. 29% respondents are neutral to the difference between their expectations and the actual
product received by them whereas, 20% Strongly Agree to the fact that there would be
dissatisfaction if there is difference between expectations and real products.

4.4.5 You will never repurchase from the same company if there is a great
difference between expected and the real product
35 42 17 4 2
45 42
40 35
35
30
25
17
20
15
10
4 2
5
0
Disagree
Figure 10 Responses for denial to repurchase if difference between expected and the real product
INFERENCE: The inference drawn from Figure 10 states that studying the fact that the
customer would not repurchase from a company if there is a difference between expectations and
real product, 42% respondents Agree to the fact that they will not repurchase from the company
if there is a difference between expected and real product received. 42% Strongly Agree to the
fact that they would not purchase from the company in case the company delivers a product
different from expected one whereas 17% respondents are neutral to repurchase in case of
difference between their expectations and the actual product received by them.

4.4.6 The after sales services offered by the company are highly satisfactory
7 33 50 8 2
50
50
45
40
33
35
30
25
20
15
7 8
10
2
5
0
Disagree
Figure 11 Responses for after sales services
INFERENCE: The inference drawn from Figure 11 states that studying the fact that the after
sales services offered by the companies are highly satisfactory. 50% respondents were Neutral to
the after sales services meaning that they were neither very much satisfied not dissatisfied with
the after sales services offered and hence after sales services do not affect the level of customer
satisfaction in online shopping. 33% respondents Agree to the fact that after sales services
offered by companies are really very satisfactory whereas 8% Disagree with the satisfaction level
of after sales services.

4.4.7 The customer care services offered are highly satisfactory
10 47 34 6 3
50
45
40
35
30
25 47
20
34
15
10
10
5 6
3
0
Agree Neutral Disagree Strongly
Disagree
Figure 12 Responses to Satisfaction towards Customer Care service
INFERENCE: The inference drawn from Figure 12 states that studying the fact that the
customer care services offered by the companies are highly satisfactory. 47% respondents Agree
to the statement that the customer care services offered are highly satisfactory. 34% respondents
were neutral to the customer care services offered by online selling companies whereas 10%
Strongly Agree to the fact that the customer care services offered are highly satisfactory.

4.4.8 The process of making online payments is fast & easy
41 46 10 3 0
100%
90%
80%
70%
60%
41 46 10 3
50%
40%
30%
20%
10%
0
0%
Disagree
Figure 13 Responses on making online payment
INFERENCE: The inference drawn from Figure 13 states that the process of making online
payment is fast & easy. 46% respondents Agree to the statement that the process of making
online payment is fast & easy. 41% respondents Strongly Agree with the fact that the process of
making online payments is fast & easy. 10% respondents were neutral to the process of making
online payments.

4.4.9 There is no difficulty in returning/replacing the product bought online
7 38 33 17 5
38
40
35
30
25
20
15
10
0
Disagree
Figure 14 Responses on returning/replacing the product bought online
INFERENCE: Figure 14 infers to the fact that there is no difficulty in returning/replacing of the
products bought online. 38% respondents Agree to the statement that there is absolutely no
difficulty in returning/replacing the products bought online. There returning policy and ease of
replacement is quiet high. 33% respondents are Neutral towards the returning/replacement of
products bought online whereas, ironically 17% Disagree with the statement meaning that there
is difficulty in returning/replacing the products bought online.

4.4.10 Online shopping, at times, provides eligibility to exciting discounts/offers
25 65 8 2 0
70
60
50
40
65
30
20
25
10
8
2 0
0
Disagree
Figure 15 Responses to Online Discounts/offers
INFERENCE: Figure 15 infers to the fact that online shopping also provides eligibility to online
discounts/offers. 65% respondents Agree to the statement that online shopping also provides
eligibility to various other relating discounts/offers. 25% respondents Strongly Agree with the
same fact of online discounts/offers whereas, 8% respondents are Neutral towards the eligibility
for online discounts/offers.

4.4.11 You will recommend & motivate your other friends to purchase online
21 57 17 4 1
60 57
50
40
30
21
20 17
10
4
1
0
Figure 6 Responses on recommendation to other friends for purchasing online
INFERENCE: Figure 16 infers to the fact that the respondent would recommend his other
friends to purchase online. 65% respondents Agree to the fact that they would recommend the
online purchase to their friends. Word of mouth communication is the best way a product can be
promoted. One satisfied customer promotes the product to 10 other people in his peer group.
21% respondents Strongly Agree with the same fact of recommending online purchase to his/her
friends whereas, 17% respondents are Neutral towards recommending online shopping to their
friends.

4.4.12 A variety of choice helps choosing the best in class from amongst various
brands
33 58 8 1 0
58
60
50
40
33
30
20
8
10
1 0
0
Disagree
Figure 17 Responses on availability of choice from amongst various brands
INFERENCE: Figure 17 infers to the fact that the respondent has a wide variety of choice
available to choose the best in class from amongst various brands available online. 58%
respondents Agree to the fact that they have a choice of choosing the best from a variety of
brands. 33% respondents Strongly Agree with the same fact of availability of choice amongst
various brands to choose the best in class whereas, 8% were Neutral towards the availability of
choice from amongst various brands.

4.4.13 You are overall satisfied with your experience of shopping online
22 57 18 2 1
Overall Customer Satisfaction

1
2
18 22
Strongly Agree
Agree
Neutral
Disagree
57 Strongly Disagree
Figure 18 Responses on Overall Customer Satisfaction
INFERENCE: Figure 18 infers to the fact that the respondents are overall satisfied with their
online shopping experience.
57% respondents expressed agreement with the statement that they were overall satisfied with
their online shopping experience. 22% respondents expressed strong agreement with the
statement that they were overall satisfied with their online shopping experience. Summing up the
responses, 79% respondents expressed overall satisfaction towards their online shopping
experience. 18% expressed neutral behaviour and only 3% expressed dissatisfaction.

4.5 TESTING OF HYPOTHESIS
Usually, in quantitative study tests of significance are used to decide whether certain inferences
can be drawn regarding any differences or relationships between variables. To do these
significant tests MS Excel 2007 software has been used. The significance (or p-value), which is
the probability of the null hypothesis (H0), being accepted. Hence the level of probability of 5%
or less is commonly taken as an appropriate level for most general research including this study.
As a result, H0 is accepted if the significance level is greater than 0.05 (p > 0.05)
H0 is rejected if the significance level is less than 0.05 (p < 0.05)
Thus, combining all the customer satisfaction factors under one head, the hypothesis of this study
is: H1: The youth of Shimla city are overall satisfied with their experience of Online Shopping
Null Hypothesis (H0): The youth of Shimla city are not highly satisfied with their experience of
Online Shopping
Alternate Hypothesis (HA): The youth of Shimla city are highly satisfied with their experience
of Online Shopping
Where the term “overall” includes following variables under study: Quality of products, Speed of
delivery, Low prices, difference between expected & real products, repurchases option, after
sales services, customer care services, easy online payments, retuning/replacing, special
discounts/offers, recommending others to buy online, variety of choice available and overall
satisfaction.
The MS Excel 2007 outputs for normal curve and one sample test for hypothesis-1 are shown in
the Table 1 and Table 2 respectively. As Likert scale was used in the main research question of
this study where 1 = strongly Agree, 2 = Agree, 3 = Neutral, 4 = Disagree, and 5 = Strongly
Disagree as 3 (neutral) is the middle point of this scale. So, 3 has been chosen as test value for
this one sample t-test.

Table 1- One Sample Statistics
Variable N Mean St. Deviation St. Error Mean
Quality of products 100 2.19 0.80019 0.080019
Speed of delivery 100 2.23 0.75015 0.075015
Low prices 100 1.91 0.71202 0.071202
Difference between expected & real 100 2.09 0.69769 0.069769
Repurchases option 100 1.96 0.93117 0.093117
After sales services 100 2.65 0.80873 0.80873
Customer care services 100 2.45 0.86894 0.086894
Easy online payments 100 1.75 0.75712 0.075712
Retuning/replacing 100 2.75 0.98857 0.098857
Special discounts/offers 100 1.87 0.63014 0.063014
Recommending others to buy online 100 2.07 0.79462 0.079462
Variety of choice available 100 1.77 0.63333 0.063333
Overall satisfaction 100 2.03 0.75819 0.075819
Table 2- One Sample Test

95% Confidence
Signifiance Mean
Factor t df Difference Interval
(2-tailed) Difference
Lower Upper
Quality of products 10.1226 99 0.000 0.81 1.38 3
Speed of delivery 10.26461 99 0.000 0.77 1.46 3
Low prices 15.30856 99 0.000 1.09 0.82 3
Difference b/w expected & real 13.04304 99 0.000 0.91 1.18 3
Repurchases option 11.16874 99 0.000 1.04 0.92 3
After sales services 0.432777 99 0.6662 0.35 2.3 3
Customer care services 6.329551 99 0.000 0.55 1.9 3
Easy online payments 16.50993 99 0.000 1.25 0.5 3
Retuning/replacing 2.528905 99 0.1392 0.25 2.5 3
Special discounts/offers 17.93252 99 0.000 1.13 0.74 3
Recommending online buying 11.70371 99 0.000 0.93 1.14 3
Variety of choice available 19.42115 99 0.000 1.23 0.54 3
Overall satisfaction 12.79363 99 0.000 0.97 1.06 3

From Table 2, it has been seen that the significant value of all variable is less than 0.05 except
the variables After sales service & Returning/replacing whose values (0.6667) & (0.1392) are
greater than 0.005. Since, the hypothesis (H1) was developed based on these variables where the
significant value of 11 variables out of 13 (Quality of products, Speed of delivery, Low prices,
difference between expected & real products, repurchases option, after sales services, customer
care services, easy online payments, retuning/replacing, special discounts/offers, recommending
others to buy online, variety of choice available and overall satisfaction) are less than 0.05; as a
result null hypothesis (H0) is rejected and alternative hypothesis (HA) is accepted. So for
hypothesis H1, it can be said that the youth of Shimla city are highly satisfied with their
experience of Online Shopping.

CHAPTER-5
CONCLUSION
1.1 FINDINGS
1.2 CONCLUSION

CHAPTER 5 – CONCLUSION
5.1 FINDINGS
As the research concluded, a number of findings were obtained. Undertaking the study on a
random sample of 100 youth from Shimla city helped us reach some findings which clearly tell
us about the demographic interest, online presence, buying behaviour & most importantly the
level of customer satisfaction achieved by youngsters in online buying.
 65% males responded to the questionnaire in comparison to 35% females showing the
participation of males in demographically much more active as compared to females.
 Maximum number of respondents (78%) were from the age group 18 to 24 expressing their
immediate interest in responding to a questionnaire about online shopping, their inherent
interest.
 Maximum number of respondents (55%) were found to be graduates followed by post
graduates (40%) inferring that educated youth was much keen & interested in online
shopping.
 Maximum respondents were found to be the residents of urban area (68%).
 It was found that maximum number of respondents (95%) had easy access to internet mainly
through laptops (49%) or smartphones (39%) which makes internet accessing anybody’s
cup of tea.
 Most of them (39%) used Internet for 2 to 4 hours daily mainly with the purpose of social
networking (32%) or education/research work (26%). Debit card was selected to be the
most preferred mode (56%) of online payment.
 Majority of participants (97%) agreed that they were aware of the concept of online shopping
and undertook online shopping at least once a month (39%).
 Online shopping is preferred over tradition shopping owing to major factors like wide range
of choice (27%), time saving (22%), convenience (21%) & low price (21%).
 Flipkart.com was found to be the most preferred online shopping portal (39%) followed by
Myntra.com (20%).
 Majority online purchases were made in the genres of clothing/footwear (50%), electronic
gadgets (28%) & books (12%).

 Majority of respondents were found to be highly satisfied (71%) with the quality of
products bought online.
 Maximum respondents (71%) were found to be satisfied with speed of delivery of products
purchased online.
 Majority of respondents (83%) agreed to the fact that the products purchased online have
comparatively low prices as compared to traditional market.
 Majority of respondents (71%) were of the idea that a difference between expected &
actual product would negatively affect their level of satisfaction.
 Owing to the difference in expected and real product, maximum number of respondents
(77%) agreed that they would never repurchase any product from the same portal.
 Majority of respondents (50%) were found to be neutral towards the after sales services.
 Majority of respondents (57%) were found to be satisfied with the customer care services.
 Maximum numbers of respondents (87%) were of the idea that making online payment is
quiet fast & easy.
 Majority of respondents (45%) agreed that they had no difficulty in returning/replacing the
products.
 Largest chunk or respondents (90%) agreed with the fact that online shopping also provided
eligibility to special discounts/offers.
 Majority of respondents (78%) stated that they would recommend online shopping to their
friends too.
 Largest chunk of respondents (91%) agreed with the fact that online shopping provided a
variety of choice to choose the best in the class from amongst various brands.
 The final and the most important finding of the study was that a majority of respondents
(79%) were found to be overall completely satisfied with online shopping experience.

5.2 CONCLUSION
The endeavor of this study was to determine the level of customer satisfaction in online shopping
among the youth of Shimla city. Various factors, based on previous researches, were taken into
consideration and each one was analyzed with respect to the data collected from a random
sample of 100 respondents.
Not only the level of customer satisfaction, but also information like demographic framework,
online presence & buying behaviour of the customers was analyzed.
More number of males were found to be active in responding to the questionnaire in comparison
to females. The age group of 18 to 24 years responded to the questionnaire providing maximum
responses. Maximum respondents were found to be students who had graduation as their highest
formal educational level.
While responding to questions regarding online presence, 95% respondents agreed that they had
easy access to internet which they mainly accessed using a Laptop or a smartphone for 4-6 hours
daily mainly for social networking or online shopping only. They also preferred debit card as the
mode of making online payments.
Responding to questions regarding their buying behaviour, they agreed that they were aware of
the concept of online shopping and spent approx. Rs. 1,000 to Rs. 2,000 monthly on making
online purchases. Clothing/footwear, electronic gadgets & books were found to be most bought
products & Flipkart.com was found to be the market leader followed by Myntra.com in online
shopping arena.
It was concluded that a 79% people were satisfied with product quality, cost, after sales
services, customer care & variety of products offered by the online shopping (e-commerce)
portals.

REFERENCES

REFERENCES
[1] Rashed Al Karim (2013), “Customer Satisfaction in Online Shopping: a study into the
reasons for motivations and inhibitions”, IOSR Journal of Business Management, Volume 11,
Issue 6, pp. 13-20
[2] Abu Bashar & Mohammad Wasiq (2013), “E-satisfaction and E-loyalty of Consumers
Shopping Online”, Global Sci-Tech, 5 (1) January-March 2013; pp. 6-19
[3] Taweerat Jiradilok, Settapong Malisuwan, Navneet Madan, and Jesada Sivaraks
(2014), “The Impact of Customer Satisfaction on Online Purchasing: A Case Study Analysis in
Thailand” Journal of Economics, Business and Management, Volume 2, No. 1, February 2014
[4] R. L. Keeney (1999), “The value of Internet commerce to the customer,” Management
Science, Volume 45, pp. 533-542, 1999
[5] D. J. Reibstein (2002), “What attracts customers to online stores, and what keeps them
coming back?” Journal of the academy of Marketing Science, Vol. 30, pp. 465-473, 2002
[6] E. Turban and D. King (2003), Introduction to e-commerce: Prentice Hall, 2003.
[7] L. C. Schaupp and F. Bélanger (2005), “A conjoint analysis of online consumer

satisfaction,” Journal of Electronic Commerce Research, Vol. 6, pp. 95-111, 2005
[8] T. Dillon and H. Reif (2004), “Factors Influencing Consumers’ Factors Influencing
Consumers E-Commerce Commodity Purchases,” Information Technology, Learning and
Performance Journal, Vol. 22, pp. 1, 2004.
[9] V. McKinney and K. Yoon (2002), “Mariam Zahedi, the Measurement of Web-Customer
Satisfaction: An Expectation and Disconfirmation Approach,” Information Systems Research,
Vol. 13, pp. 296-315, September 1, 2002.
[10] S. L. Jarvenpaa and P. A. Todd (1996), “Consumer reactions to electronic shopping on

the World Wide Web,” International Journal of Electronic Commerce, pp. 59-88, 1996

[11] R. E. Goldsmith, E. Bridges, and J. Freiden (2001), “Characterizing online buyers: who
goes with the flow?” Quarterly Journal of Electronic Commerce, Vol. 2, pp. 189-198, 2001
[12] A. Vellido, P. J. Lisboa, and K. Meehan (2000), “Quantitative characterization and

prediction of on-line purchasing behavior: A latent variable approach,” International Journal of
Electronic Commerce, pp. 83-104, 2000.
[13] S. J. Arnold, J. Handelman, and D. J. Tigert (1996), “Organizational legitimacy and

retail store patronage,” Journal of Business Research, Vol. 35, pp. 229-239, 1996
[14] Demangeot, C. & Broderick, A. J. (2007), “Conceptualizing consumer behaviour in online

shopping environments”, International Journal of Retail & Distribution Management, 35(11),
pp. 878-894, 2007
[15] Jayawardhena, C., Wright, L.T. & Dennis, C. (2007), “Consumers online intentions,
orientations and segmentation”, International Journal of Retail & Distribution Management, 35
(6), pp 515-526, 2007

BIBLIOGRAPHY

BIBLIOGRAPHY
BOOKS:
Kotler, P. & Keller, L. K., “Marketing Management” 13th Ed., New Jersey: Pearson Education
Ltd.
Woodruff, Robert, “Know your Customer: New approaches to understanding customer values
& satisfaction”, John Wiley & Sons (1996)
Deshpande, Sameer & Lee, Nancy R., “Social Marketing in India” Atlantic Publishers
Hill, Nigel & Alexander, Jim, “The Handbook of Customer satisfaction & loyalty
measurement”, Gower Publishing Ltd. (2006)
Kothari C.R., “Research Methodology”, New Age International Publishers, New Delhi (2011)
WEBLINKS:
www.businessdictionary.com/definition/customer-satisfaction.html
www.iosrjournals.org/iosr-jbm/papers/Vol11-issue6/B01161320.pdf
www.cisjournal.org/journalofcomputing/archive/vol5no1/vol5no1_9.pdf
www.academia.edu/2968801/Online_Shopping_and_Consumer_Behaviour_E-
satisfaction_and_E-loyalty_of_Consumers_Shopping_Online
www.joebm.com/papers/89-A00007.pdf
www.business.uconn.edu/users/sulin/pom-ba.pdf
www.sciencedirect.com/science/article/pii/S1877050910004229
www.aiars.org/ijmp/journals/.../PA_IJMP_20130127.pdf

ANNEXURE

QUESTIONNAIRE
Customer Satisfaction in Online Shopping among
Youth of Shimla City
 Please spare some time from your busy schedule to fill up this questionnaire.
 The information gathered will be used as data for the Research Project.
 Tick (√) only one option whichever is applicable/most suitable.
Name: _____________________________________________
A. DEMOGRAPHIC INFORMATION
1. What is your Gender?
Male ( )
Female ( )
2. What is your age?

Under 18 ( )
18-24 ( )
25-30 ( )
31-40 ( )
Above 40 ( )
3. What is your highest level of formal education?

8th Grade or Less ( )
Higher Secondary ( )
Senior Secondary ( )
Graduation ( )
Post Graduation ( )
M. Phil ( )
Doctorate (Ph. D) ( )
4. What is your current occupation?

Student ( )
Public Sector ( )
Self-employed ( )
Professional ( )
Retired ( )
Housewife ( )
Others ( )
5. What is your approx. total income per year?
Less than Rs. 50,000 ( )
Rs. 50,000 – Rs. 2,00,000 ( )
Rs. 2,00,000 – Rs. 4,00,000 ( )
Rs. 4,00,000 – Rs. 10,00,000 ( )
Greater than Rs. 10,00,000 ( )
6. You belong to which background?

Rural ( )
Urban ( )
B. ONLINE PRESENCE
1. Do you have easy access to Internet?
Yes ( )
No ( )
2. Which device do you use for accessing Internet?

Laptop ( )
PC ( )
Cyber Café ( )
Simple Mobile ( )
Smart Phone ( )
3. How much time do you spend on internet every day?

Less than 1 hour ( )
1-2 hours ( )
2-4 hours ( )
5-8 hours ( )
More than 8 hours ( )
4. What is your main objective behind internet usage?

Social Networking ( )
Accessing E-mail ( )
Education/Research ( )
Surfing ( )
Online Shopping ( )
Work/Business ( )

5. What Mode of Payment do you use for making Online Payments?
Debit Cards ( )
Credit Cards ( )
Internet Banking ( )
Paypal ( )
C. BUYING BEHAVIOUR
1. Are you aware of the Concept of Online Shopping?
Yes ( )
No ( )
2. How often do you Shop online?

Twice a Week ( )
Once a Week ( )
Fortnightly ( )
Monthly ( )
Bi-Monthly ( )
Once in Six Months ( )
3. Why you prefer Online Shopping over Retail Shopping?

Convenient ( )
Low Price ( )
Time Saving ( )
Wide range of choice ( )
Consumer reviews ( )
Guarantee/Warrantee ( )
After sales services ( )
4. Which web portal do you prefer for Online Shopping?

FlipKart.com ( )
Ebay.in ( )
Amazon.in ( )
Snapdeal.com ( )
Shopclues.com ( )
Myntra.com ( )
HomeShop18.com ( )
Naaptol.com ( )

Jabong.com ( )
Tradus.in ( )
5. What sort of products do you prefer buying online?

Books ( )
Clothing/Footwear ( )
Electronic Gadgets ( )
Household Items ( )
Cosmetics ( )
Sports & Fitness Equipments ( )
Toys ( )
Furniture ( )
Others (Please Specify) ( )
6. How much approx. amount do you spend on a single Online Purchase?

Less than Rs. 200 ( )
Rs. 201 – Rs. 500 ( )
Rs. 501 – Rs. 1,000 ( )
Rs. 1,001 – Rs. 2,000 ( )
Rs. 2,001 – Rs. 5,000 ( )
More than Rs. 5,000 ( )
D. CUSTOMER SATISFACTION
1. The quality of products purchased Online is highly satisfactory
Strongly Agree ( )
Agree ( )
Neutral ( )
Disagree ( )
Strongly Disagree ( )
2. The speed of Delivery of products is fast

Strongly Agree ( )
Agree ( )
Neutral ( )
Disagree ( )

3. The products available online are priced low in comparison to traditional
market
Strongly Agree ( )
Agree ( )
Neutral ( )
Disagree ( )
4. The difference between your expectations and real products would

influence your satisfaction level
Strongly Agree ( )
Agree ( )
Neutral ( )
Disagree ( )
5. You will never repurchase from the same company if there is a great
difference between expected and the real product
Strongly Agree ( )
Agree ( )
Neutral ( )
Disagree ( )
6. The after sales services offered by the company are highly satisfactory
Strongly Agree ( )
Agree ( )
Neutral ( )
Disagree ( )
7. The customer care services offered are highly satisfactory

Strongly Agree ( )
Agree ( )
Neutral ( )
Disagree ( )

8. The process of making online payment is quiet fast & easy
Strongly Agree ( )
Agree ( )
Neutral ( )
Disagree ( )
9. There is no difficulty in returning/replacing a product in case of

dissatisfaction
Strongly Agree ( )
Agree ( )
Neutral ( )
Disagree ( )
10. Buying some products also gives eligibility for exciting discounts/offers
Strongly Agree ( )
Agree ( )
Neutral ( )
Disagree ( )
11. You will recommend & motivate your other friends to purchase online
Strongly Agree ( )
Agree ( )
Neutral ( )
Disagree ( )
12. A variety of choice available helps choosing the best in class from
amongst various brands
Strongly Agree ( )
Agree ( )
Neutral ( )
Disagree ( )

13. You are overall satisfied with your experience of shopping online
Strongly Agree ( )
Agree ( )
Neutral ( )
Disagree ( )
14. Any other factor, as per your knowledge, which affects the customer
satisfaction in Online Shopping, Please Mention Below
Thanks for sparing your precious time. Have a nice day. 

Youth satisfaction with online shopping in Shimla

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Customer satisfaction in Online Shopping among youth of Shimla city

CUSTOMER SATISFACTION IN ONLINE

VISHAL SHARMA (2527)

in partial fulfillment for the award of the degree

HP UNIVERSITY BUSINESS SCHOOL

HP University Business School, Shimla Page 1

Place: Shimla Vishal Sharma

HP University Business School, Shimla Page 2

This is to certify that the project entitled “Customer Satisfaction in Online

Dr. Shyam Lal Kaushal

HP University Business School, Shimla Page 3

HP University Business School, Shimla Page 4

I express my wholehearted gratitude to the Himachal Pradesh University Business School,

HP University Business School, Shimla Page 5

HP University Business School, Shimla Page 6

HP University Business School, Shimla Page 7

HP University Business School, Shimla Page 8

HP University Business School, Shimla Page 9

Online shopping or e-shopping is a form of electronic commerce which allows consumers to

English entrepreneur Michael Aldrich invented online shopping in

HP University Business School, Shimla Page 10

1.2.2 E-Commerce statistics

HP University Business School, Shimla Page 11

 Cash on delivery (C.O.D)

HP University Business School, Shimla Page 12

1.2.7 Shopping cart systems

HP University Business School, Shimla Page 13

1.3.2 Ease of exchange

1.3.3 Information and reviews

1.3.4 Price and selection

HP University Business School, Shimla Page 14

1.4.1 Fraud and security concerns

1.4.2 Lack of full cost disclosure

1.4.4 Product suitability

HP University Business School, Shimla Page 15

1.6 ONLINE SHOPPING PORTALS IN INDIA

HP University Business School, Shimla Page 16

HP University Business School, Shimla Page 17

HP University Business School, Shimla Page 18

Customer satisfaction is a term frequently used in marketing. It is a measure of how products

Customer is the King

According to Business Dictionary, it is defined as “the degree of satisfaction provided by

Therefore, it is essential for businesses to effectively manage customer satisfaction. To be able

HP University Business School, Shimla Page 19

1.8.2 Delivery time

1.8.3 Low price

1.8.4 Choice availability

HP University Business School, Shimla Page 20

1.8.7 Payment options

1.8.8 Expectation fulfillment

HP University Business School, Shimla Page 21

HP University Business School, Shimla Page 22

HP University Business School, Shimla Page 23

2.2 CUSTOMER SATISFACTION

HP University Business School, Shimla Page 24

2) Shopping Experience: Attributes of time, Convenience, and Product availability, Effort,

3) Customer service: Vendor responsiveness, Assurance and Reliability.

HP University Business School, Shimla Page 25

1) Convenient and dependable shopping - Convenience, Guaranteed delivery, Secure transaction

2) Retailer Reliability – Dependable product, Competitive price, Store Policy.

3) Additional Information availability – Information of the online store, Production, Promotion,

HP University Business School, Shimla Page 26

HP University Business School, Shimla Page 27