INTRODUCTION:

E-Commerce (electronic commerce or EC) is the buying and selling of goods and services on the
internet, especially the World Wide Web. The E-business and Ecommerce were the two most
significant developments in information technology during the 1990s. There has been a valuable
increase in the number of consumers who purchase over the Internet, as well as an increase in
sales worldwide conducted via E-commerce. Innovations of information technology and E-
commerce relationships have resulted in tremendous changes in market competition among
various industries. E-commerce offers many online marketing opportunities to companies
worldwide and along with high rapid growth of online shopping; it has attracted retailers to sell
products and services through online channel to expand their market. Benefits of E-commerce
have been grown very fast because of the many advantages associated with buying on internet as
the lower transaction and search cost of products as compared to other types of shopping.

Online shopping is a form of E-commerce whereby customers directly purchase goods or

services from a seller over the internet. Online shopping is no doubt the future trend.
Online shopping is still at the early stage of development in India. Online shopping has
become a popular and easy way for customers to purchase products at lower cost. Online
Shopping is done through an online shop or electronic-shop or electronic-store or Internet
Shop or online store etc. All the products in online stores are described through mail, text,
with photos and with multimedia files etc. Many online shops will provide their links for
extra information about the products & services. Online shopping is the use of IT (information
technology) (i.e., computer, laptop, smart phones, with the help of internet) for better
marketing performance of the business organization. And retailers are mixing their strategies
to increase the demand of online consumers. The marketing manager of the organisation
should understand the customer behavior in order to make the decision to purchase the online
products or services. Online shopping allows customers to purchase faster than traditional
shopping; more alternatives of products are available and customers can order products and
services with comparative lower price of product. Consumer’s attitude towards online
shopping refers to consumers’ psychological state in terms of making purchase decisions
through online.
Internet as a global communication medium has increasingly being used as an innovative tool
for marketing of goods and services. Purchasing via the Internet is one of the most rapidly
growing forms of shopping, with sales growth rates that outpace buying through traditional
retailing (Levy & Weitz, 2001). In the world wide, consumers are rapidly adopting eshopping
and it has become more popular in India also. In the past few years the whole
concept of shopping has been altered in terms consumer perception in buying. With the
increasing urbanization, the consumer’s are emerging more and more trend-conscious.

Consumer perception involves the study of how people buy, what they buy, when they buy
and why they buy. It blends elements from psychology, sociology, socio-psychology,
anthropology and economics (Bhattacharya & Sen, 2003). It also tries to assess the influence
on the consumer from groups such as family, friends, reference groups and society in general.
Consumers can either be subjective or objective, testing the persuasiveness of brand names.
Retail stores selling the products also play an important role in swaying the decisions of
consumers. With the rise of e-shopping and its long-term potential in the retail industry, many
players are interested in the changes that it will bring about. To promote e-retailing the
marketing agents are eager to identify its advantages and limitations compared to traditional
shopping, and the factors influencing the adoption and usage of e-shopping (Aaker &
Joachimsthaler, 2000). If online marketers and retailers know and understand the key
variables influencing the consumers’ perception on e-shopping, they can further develop their
marketing strategies to attract and retain more and more customers (Patro, 2016).

Furthermore, consumers may choose particular products/brands not only because these
products provide the functional or performance benefits expected, but also because products
can be used to express consumers’ personality, social status or affiliation or to fulfill their
internal psychological needs, such as the need for change or newness. It also provides
consumer more information and choices to compare product and price, more choice,
convenience, easier to find anything online. This study empirically assesses the factors that
the consumers’ perception on e-shopping.
 LITERATURE REVIEW

Kanwal Gurleen (2012) this paper focuses on the understanding of demographic profiles of
adopters and non-adopters of online shopping. The following four factors were found to be
significant Price Consciousness, Convenience and Variety, Easy Payment options and
Challenges of Online Shopping. Most of the consumers prefer to buy some selected products
online because they will get heavy discounts in comparison to store purchases. Also, the
consumer feels that there are good websites available which can be trusted for purchases. The
only worry of consumers is regarding the trustworthiness of some websites, since they have to
give their credit card details to shop online.

D.R.M.Rajesh and G.Purushothaman (2013) studied E-shopping has become growing more
popular, the main reason is convenience (and often lower prices). Usually in the holiday season,
online shopping saves an individual the hassle of searching several stores and then waiting in
long queues to buy a certain item. Internet is changing the way consumers shop and buy goods
and services, and has quickly evolved into a global phenomenon. Numerous companies have
started using the Internet with the purpose of cutting marketing costs, thereby minimizing the
price of their products and services in order to face competition. No doubt the Internet has affect
our lives deeply in which it plays a pre-eminent and unparalleled role. In addition to the
tremendous potential of the E-commerce market, the Internet provides a distinctive opportunity
for companies to more efficiently reach existing and potential customers

K.S. Silpa, P.U. Rajasree and Dr.P. Balasubramanian (2016): This project was an attempt to
study people's perception towards online shopping. As a result of survey the majority of people
prefer to do online shopping, even if they felt some difficulties. Majority of the people agree that
in the near future, online shopping will be more on demand than offline shopping. Therefore,
online marketing have a wider scope in the coming years. More people prefer cash on delivery
than net banking. Greater part of respondents encourages other people to enter into e-shopping.
Most people do not shop online due to fear of quality of goods, afraid to give out their credit card
details and also they find conventional methods more enjoyable. The fact that a large number of
people is getting attracted towards online shopping creates a basis for tremendous prospects for
marketers of today and tomorrow.

K. Rama Mohana Rao and Chandra Sekhar Patro (2016) the study focuses on identifying
and analyzing the various factors influencing the consumers' perception towards e-shopping on
different products available in the online retail market. The findings of the study established the
fact that consumer perception on e-shopping depends upon different factors which can be
broadly identified as convenience, website design, delivery, price advantage, reliability, and
responsiveness. According to the study, most of the respondents are satisfied with the current
conditions. But there are still several indicators that are needed to be improved. Due to increase
in e-shopping websites, the in-store shoppers need to attract the consumers with more attractive
offers and quality products.

Vidyashree.D.V, Alay.P, and Shobha.H.N (2018) examined that consumer’s perception on

online shopping varies from person to another and the perception is limited to a certain extent
with the availability of the proper connectivity and the exposure to the online shopping has to be
improved to make the customer satisfied. The perception of the consumer also has similarities
and differences based on their personal characteristics usage based on their needs and demand. In
the day to come online shopping has tremendous potential and more and more businesses are
going to add online platform to offer extended retailer’s shelves in the customers. However they
have to build up the trust by offering value service to the customers to sustain in the long run.

Muthumani & et.al. (2017) this study shows that the online shopping is one of the most popular
way for consumers to make purchases of goods and availing services, but this study identifies
that it is not a comfortable and safest one for consumers to make purchases and availing services
online. The study also finds that online shopping is gaining popularity among young people to
make purchases their requirements.

Madhu & Sampath (2017) in their study online shopping has now become a primary part of any
business. This study also stressed that the e-commerce portals have to educate and promote the
consumers towards online shopping by determine the factors influencing the consumers towards
online shopping. This study concludes that the era of information providing new dimension to
the marketer and consumer as well by virtual shops in India.

Guo Jun & et.al. (2017) in their study, Online shopping is an innovative platform to do business
in this competitive world and it is a classic example of the business revolution. This study
focused on online shopping in china and the study states that consumer perceived positively with
relate to factors such as usability, safety, privacy, after sales service and quality of products. it
also states that most of the young population preferred to use online shopping to make purchase
of their necessities.

Pritam Kothari & et.al. (2016) this study states that the rising number of internet user in India
provides a bright prospect for e-commerce. This paper highlights on factors which influences
consumer to shop online. Indian consumers using e-commerce portal not only to purchase the
product but also to avail online services. This study finds that majority of customers perceived
that online shopping is the best way to buy goods and services and they were willing to continue
this platform of purchasing.

Rajarajan and Vetriveeran (2016) this paper analyse the customer satisfaction level in online
marketing the study was conducted among two hundred and fifty respondents and it finds that
majority of the respondents preferred to use online shopping portal for buying goods and services
and this study suggest that due to the increasing importance of online shopping, e-merchants
should protect the consumers by supplying quality goods and services at affordable prices.

According to Sharma and Mittal (2009) in their study "Prospects of e-commerce in India",
mentions that India is showing tremendous growth in Ecommerce. Undoubtedly, with the
population of millions of people, online shopping shows unlimited potential in India... Today
E-commerce is a common word in Indian society and it has become an integral part of our
daily life. There are websites providing a number of goods and services. Then there are
those, which provide a specific product along with its allied services. Multi-product ecommerce-
These Indian E-commerce portals provide goods and services in a variety of
categories. To name a few: Apparel and accessories for men and women, Health and beauty
products, Books and magazines, Computers and peripherals, Vehicles, Software, Consumer
electronics, Household appliances, Jewelry, Audio/video, entertainment, goods, Gift articles,
Real estate and services.

Ramirez Nicolas (2010) state that "The Internet has changed many facets of our daily lives:
the way we relate and communicate with one another, how we interact with a bank, read
newspapers or watch television. Even the way we buy and sell. These changes have occurred
due to the constant flow of companies offering new business models and innovative formulae.
Discount coupons have always been a powerful marketing tool. Whether inserted in printed
media or posted through letter boxes, they attracted new customers and were also offered
at the time of purchase to promote consumer loyalty by encouraging repeat purchases at outlets.
In order to play the "high number game", there were many businesses which offered
special discounts to a group of customers together. This led Andrew Mason in 2008 to
launch "The Point", an online community to obtain best group deals. In the November of
same year, famous "Groupon" was incorporated. Currently, Groupon is present in over 45
countries around the world since March 2010, and has received multi-million dollar bids
from industry giants like Yahoo! and Google .All these advantages have triggered a rush
among consumers to buy discount coupons and the rate of user growth is rising incessantly.

Donald Rogan (2007) explains the relationship between consumer behavior and marketing
strategy. He states that strategy is about increasing the probability and frequency of buyer
behavior. Requirements for succeeding in doing this are to know the customer and understand
the consumer's needs and wants. The expectation-confirmation model (Oliver 1980), on the
other hand, focuses on the post-purchase behavior. It is a widely used model in the consumer
behavior literature, particularly in explaining consumer satisfaction and repeat purchase.
Satisfaction is the central notion of this model and it is formed by the gap between expectations
and perceived performance (Oliver 1980). The expectation-confirmation theory suggests
that if the perceived performance meets one's expectation, confirmation is formed and
consumers are satisfied.

Bhattacherjee (2001) stated that satisfied users are more likely to continue the IS use. Thus, we
point that adoption and continuance are connected to each other through several mediating and
moderating factors such as trust and satisfaction.
Venkatesh (2000) reported that perceived convenience offered by Internet Vendors has a
positive impact on consumers' attitude towards online shopping, as they perceive Internet as
a medium that enhances the outcome of their shopping experience in an easy way. Online
Shopping holds a great potential for youth marketers. According to Vrechopoulos et al. (2001)
youth are the main buyers who used to buy products through online.

Dholakia and Uusitalo (2002) study examined the relationship between age and Internet
shopping; found that younger consumers reported more linen to the online shopping. They also
found that younger consumers searched for more products online and they were more likely to
agree that online shopping is more convenient.

Benedict et al (2001) in his study on perceptions towards online shopping reveals that
perceptions toward online shopping and intention to shop online are not only affected by
ease of use, usefulness, and enjoyment, but also by external factors like consumer traits,
situational factors, product characteristics, previous online shopping experiences, and trust
in online shopping.

Huseynov and Yıldırım (2014) emphasized that the lack of physical interaction tends to be the
critical impediment in online retail sales followed by the privacy of individual information and
security of financial transactions over the Internet.

Demangeot and Broderick (2010) also revealed that perceived ease of use does not affect the
behavioral pattern in this case rather influenced by security and privacy issues. No relationship is
built between the customer and the online shop in the presence of perceived online risk even if a
customer spent hours on the Internet (Zuroni & Goh, 2012).

Vrender, (2016): Day-by-day taste, preference and choices are varying regarding different
factors such as the Internet emergence. However, this development needs some more
understanding related to the consumer’s behavior. Consumer behavior research identifies a
general model of buying behavior that depicts the processes used by consumers in making a
purchase decision. Those designs are paramount to the marketer as they can explain and predict
consumer purchase behavior.
Jarvenpaa, and Todd (1997) proposed a model of attitude, behavior, and shopping intention
towards Internet shopping in general. The design includes several indicators classified into four
broad categories like product value, quality services offered through the website, the shopping
experience, and the risk perception of the online shopping.

Chang, Cheung, and Lai (2005) studied categories of variables, which drive online shopping
activity. In their study, they divided the features into three broad categories. Perceived
characteristics of the web sales channel is the first one which includes risk, online shopping
experiences, advantage, service quality, trust. The second category is a website and product
features which are risk reduction measures, site features, and product characteristics; and the last
group is consumer characteristics. Various types of features, demographic variables, consumer
shopping orientations, consumer innovativeness and psychological variables, computer, Internet
knowledge, and usages drives consumer characteristics.

Koufaris (2002) identified that both shopping enjoyment and perceived usefulness (website)
strongly predict the intention to re-purchase over online. On the contrary, Lee and Lin (2005)
found shopping enjoyment can increase the intent of new customers but does not influence
customers to return. In fact, the web store which utilizes value-added mechanisms in the search
engine and providing customers a challenging experience may increase customers’ shopping
enjoyment. Furthermore, if there are more often customers back to the web store, their shopping
enjoyment then be determined by their involvement with the product (Marios Koufaris,
Kambil, & LaBarbera, 2001)

Also, demographic variables such as age, gender, and level of income play a facilitating role
because they influence consumer perception and consumer behavior that drives them towards
online shopping (Kim, Zhao, & Yang, 2008; Laforet & Li, 2005; Sabbir Rahman, 2012). In
China, online shopping intention depends on consumers’ age, income, and education as well as
marital status and most importantly their perceived usefulness (Gong, Stump, & Maddox,
2013).
 CHAPTER 2:
LITERATURE REVIEW

SUBMITTED TO: LALY PADMAVATY

SUBMITTED BY: RAHEEMA GAFOOR