Online Shopping vs Malls: Are malls losing customers

because of the rise in online shopping?

Submitted to: Ms. Pallavi Rallan

Submitted on: 24th March 2018
SYBBA-B
Submitted By: Anouska Bhatia (10)
Anmol Randeria (08)
Anoop Soneja (09)
Aman Shah (07)
Akhilesh Pandey (06)
Contents
Executive Summary 4
Acknowledgements 5
1. Background 6
1.1 Introduction 6
1.1 Literature Review 6
1.2 Statement of Problem 7
1.3 Research Objectives 7
2. Research methodology 7
2.1 Research design and data collection method. 7
2.2 Target population 8
2.3 Sample technique 8
2.4 Data analysis 8
2.4.1 Variables used in the analysis 8
3. Findings and Interpretation 8
3.1 Preference between shopping mall and online shopping 8
3.2 Frequency of shopping online 9
3.3 Factors that influence the shopping experience of the customers online 10
3.4 Frequencies of customers shopping at malls 10
3.5 Factors influencing the shopping experience of the customers in malls 11
3.6 Occasions at which Consumers prefer to purchase online 12
3.7 Occasions at which Consumers prefer to shop from malls 12
3.8 Products customers prefer to purchase online 13
3.9 Products customers prefer to purchase in malls 14
3.10 Reasons apart from shopping customers go to malls 14
4. Conclusions 15
5. Recommendations 16
6. Limitations 16
Appendix A-Questionnaire 17
Appendix B- Tables 18
Bibliography 21
Index of Tables
Table 1: Variables used in the data analysis 7
Table 2: Preferred occasion at which consumer buy online 11
Table 3: Occasions on which customers are most likely to buy from shopping malls 12
Table 4: Reasons apart from shopping to visit malls 13

Index of Graphs
Graph 1: Preference of shopping in malls or online 8
Graph 2: Frequency of customers to shop online 8
Graph 3: Reasons for customers to shop online 9
Graph 4: Frequency of customers shopping at malls 10
Graph 5: Ranking of factors influencing the customer shopping experiences at malls 10
Graph 6: Products customers prefer to purchase online 12
Graph 7: Products customers prefer to purchase in malls 13
Executive Summary
Comparison between online and offline shopping has gained a lot of attention in the past few
years. The level of competition in the retail market is high and demands a need to manage
shopping malls appropriately and understand the general consumer behaviour in terms of their
main reasons for visiting the mall and find and utilise any edge they have over online shopping
to increase footfall. However in the Indian context, not a lot of research has been done on
whether malls are really suffering and what can be done to remedy it.
But are malls really at a disadvantage when it comes to online shopping? If so, in what areas and
occasions are they lagging. This study aimed to determine if malls are losing customers to online
shopping, where and under what conditions, and the reasons apart from shopping customers
frequent malls.
A quantitative approach was followed to realize research objective using online-administered
questionnaires for data collection. A descriptive analysis method was used to analyse the
quantitative data. The findings of the study revealed that the customers have almost equivalent
preference for malls and online shopping, is caused due to various reasons and influenced by
factors such as product category, occasion.
This study contributes to the current literature and provides information to Indian shopping mall
managers, regarding reasons customers visit malls apart from shopping which can be used to
increase the frequency of visits of customers at the shopping mall. Suggestions for future
research are provided.
Acknowledgements

We students of NMIMS-ASMSOC would like to thank Ms. Pallavi Rallan for assistance with our research
and for comments that greatly improved the manuscript.

We would also like to show our gratitude to NMIMS for sharing their pearls of wisdom with us
during the course of this research.
1. Background
1.1 Introduction
Officially shopping malls are defined as “A usually large suburban building or group of
buildings containing various shops with associated passageways” (Merriam Webster).
Unofficially they are the foundation of retail economies, and a social sanctuary for teenagers
everywhere. Shopping malls play an important role in a retail sector. They have adapted to new
designs and tenant varieties to meet the changes in customers’ needs, desires, values, and
lifestyles [ CITATION Tec13 \l 16393 ]
Despite malls being a newer concept in India, compared to the US, it is facing threat and
challenges from the e-commerce industry. Online retailing, often referred to as online shopping
or e-tailing, is growing every day in India. Although most studies in the past have pointed out
that the process has been rather slow and unsuccessful in gathering much steam with the Indian
users, the trend is changing now, and a good number of savvy online users are making big
purchases on the digital space.
A recent report by Morgan Stanley projected that by the year 2020, India will have almost 320
million online shoppers. That’s 6.4 times more than the estimated 50 million shoppers back in
2015. E-commerce is the clearly emerging as the future of retail. Hence it becomes very
necessary to study the preference of customers towards malls and online shopping; what drives
their preference, the frequency of their purchases, and on what occasions do they prefer to buy.
This would help get a clear idea to the malls regarding what they need to shift and tailor their
actions to put up stiff competition against online shopping.
1.1 Literature Review
Sipho Makgopa (2016), Determining customers’ reasons for visiting shopping malls [ CITATION
Mak16 \l 16393 ]

Shopping malls are characterized as venues that provide a comfortable shopping experience and
have turned into social centres and recreational and entertainment facilities for various activities.
The purpose of the study aimed to determine customers’ main reasons for visiting the shopping
mall and their frequency of visits at the mall specifically at Kolonnade Shopping Centre which is
located in Montana Park, Pretoria.

Ruby S. (2014), Assessing the impact of online retailing on mall shoppers and internet users.
[CITATION SRu14 \l 16393 ]

The purpose of this study is to analyse the impact of online shopping on both mall shoppers and
internet users and how they are receptive to this change. It will also focus on some of the factors
responsible for influencing the customers to purchase through online mode and internet shopping
attitudes. It also tries to study the situational and product category effects on intention to use
internet versus mall shopping.
Binoy Mathew (2015), A Study on Changing Trends in Online Shopping of Indian Customers
[CITATION Mat \l 16393 ]

Indian e-commerce industry has been growing at a scorching rate during the last few years with
hundreds of million dollars being invested by venture capital funds in the sector. E-commerce
has been around in India for more than a decade but has become main stream only in the last few
years. The purpose of this study is to determine the reasons for such trends and assess its
potential impact on Indian retailers.

Khare, A. (2011). Mall shopping behaviour of Indian small-town customers [CITATION Arp11 \l
16393 ]

Rapid development of retailing in India has led to expansion of malls in smaller cities. The
current research was directed towards small city customers to understand their mall shopping
behaviour.
This paper examined the influence of hedonic and utilitarian shopping motives on shopping mall
customers’ attitudes towards shopping malls in the smaller cities of India, and the results
revealed that shopping mall customers visit malls for both hedonic and utilitarian shopping
motives.

DNA India Article, Malls face uncertain future as customers desert them (2015) [CITATION
Ash15 \l 16393 ]

Nearly 60% or 160 out of the overall 255 malls currently operational in top seven Indian cities
are facing an uncertain future as customers have deserted them for various reasons. Study by
Jones Lang LaSale, an international property consultant, reveals a primary factor seems to be rise
of the ecommerce industry.
1.2 Statement of Problem
Are malls are losing customers to online shopping, where and under what conditions, and what
are the reasons apart from shopping customers frequent malls?
1.3 Research Objectives
Research objectives of this study can be summarized as follows:
1. To determine if customers prefer shopping in malls or online in India
2. To analyse the main reasons why customers prefer shopping in malls or online
3. To determine customers’ frequency of shopping, both in malls and online
4. To study when do the customers prefer to buy online and in a shopping mall
5. To study what the customers prefer to buy online and in a shopping mall
6. To ascertain the reasons apart from shopping that customers visit the malls.
The next section outlines the research methodology followed to realize the research purpose of
this study.

2. Research methodology
Both primary and secondary data has been used for this study. Primary data is collected with the
help of a structured questionnaire.
This section outlines the research methodology followed to realize the research purpose of this
study starting with the research design and data collection method, target population, sampling
technique, and data analysis method used.
2.1 Research design and data collection method.
The research design is a descriptive research design. The study was quantitative for collection of
primary data. This study was conducted during March 2018. The structured questionnaire was
administrated online. (see Appendix A) No incentives were given to respondents to participate in
this study.
2.2 Target population
For this study, no defined age or racial background or limitation was subscribed to.
2.3 Sample technique
A non-probability convenience sampling was used in this study. Convenience sampling involves
the selection of readily available respondents [CITATION Don11 \l 16393 ]. Convenience sampling
method was used in this study as the method is less expensive, less time consuming and since
there was no available sample frame.
2.4 Data analysis
Descriptive statistics were used in this study to analyse the primary data on buying behaviour of
the customers in shopping malls and online shopping. Survey monkey was used to capture the
respondent’s response automatically on handheld devices and analysis of data.
2.4.1 Variables used in the analysis
In line with the overall research objectives of the study, Table 1 below depicts the variables
(frequency of visitation at the shopping mall and activities) analysed during the data analysis.
Table 1: Variables used in the data analysis
Variable name Level of measurement Univariate descriptive
statistics
Preference of shopping mall Paired Comparison-nominal Percentages, mode
or online shopping and ordinal scale
Reasons for shopping online Continuous rating – interval Percentages, mode
and in malls scale
Reasons to visit the shopping Continuous rating –interval Percentages, mode
malls besides shopping scale
Frequency of shopping Verbal frequency Percentages, mode
online and in malls
Preference of when to buy Checklist –ordinal scale Percentages, mode
online and in shopping malls
Preference in what to buy Checklist –ordinal scale Percentages, mode
online and in shopping malls
Source: Primary Data

3. Findings and Interpretation

3.1 Preference between shopping mall and online shopping

Inference:
51.43% prefer shopping in malls and 48.57% prefer shopping online there is only a difference of
2.86% that is out of the 105 respondents 51 prefer shopping online where else 54 prefer shopping
in malls which is not a very vast difference. (see Table 1 in Appendix B)
In Graph 1 it becomes clearer that there is no substantial difference between consumer’s
preference between shopping online and in malls
Graph 1: Preference of shopping in malls or online

Source: Primary Data

3.2 Frequency of shopping online

Graph 2 provides the findings regarding the frequency of customers shopping online
Graph 2: Frequency of customers to shop online

Source:

Inference:
The data clearly shows that most of the customers shop online once a month that is out of 105
respondents 24 customers’ shop online once in a month. 19.05% that is 20 respondents purchase
2-3 times a month. Hence on an average consumer buy once or twice a month from online
shopping sites (see Table2 in Appendix B)

3.3 Factors that influence the shopping experience of the customers online
The Graph 3 shows the reasons why customers shop online and what factors influence their
shopping experience. The factors that are taken into consideration are price, selection that is
variety of products available convenience, time of delivery, customer service and financial
security.
Graph 3: Reasons for customers to shop online

Please rate the importance of the following influences on

your ONLINE shopping experience (1 being the LEAST
important, 5 being the MOST important)
4
3
2
1
0 Weighted Average

Source: Primary Data

Inference:
The least important factor comes to be customer service with 2.87 weighted averages. The
reasons that influences the shopping experience online the most is the selection factor the variety
of products available followed by price being the second most important factor with 4.21 and 4.1
weighted average respectively. Customers are highly neutral between time convenience and
financial security with the same level of weighted average. (see Table 3 in Appendix B)

3.4 Frequencies of customers shopping at malls

Inference:
There are 0 respondents who go to mall once in a week. 41.90% respondents go to the mall once
a month and 30.48% go even less than once a month. Hence the frequency to go to the malls for
shopping is lesser than that of online shopping. (see Table 4 in Appendix B)

How often do you shop in MALLS?

45.00%
40.00%
35.00%
30.00%
25.00%
20.00% Responses

15.00%
10.00%
5.00%
0.00%

Graph 4: Frequency of customers shopping at malls

Source: Primary Data

3.5 Factors influencing the shopping experience of the customers in malls

The graph 5 shows the reasons why customers shop in malls and what factors influence their
shopping experience according to their ranks. The factors that are taken into consideration are
price, selection that is variety of products available convenience, time, customer service and
financial security.
Graph 5: Ranking of factors influencing the customer shopping experiences at malls
 Please rate the importance of the following influences on
your MALL shopping experience (1 being the LEAST
important, 5 being the MOST important)
4
3
2
1
0 Weighted Average

Source: Primary Data

Inference:
As shown in graph 5 there is very less difference between the rankings of the factors affecting
the shopping experiences of customers at malls. Customer service, time and convenience have
almost the same weighted average, so the customers are indifferent about these 3 factors whereas
the most important factor turns up to be price at 4.17 weighted average followed by selection and
financial security. (see Table 5 in Appendix B)

3.6 Occasions at which Consumers prefer to purchase online

Table 5 shows the occasions at which the customers are most likely to shop online. A checklist
of various occasions was provided, and respondents were asked to select the occasions on which
they were most likely to shop online to determine what time of the year and occasion do they
buy online.

Out of the following, when are you most likely to shop ONLINE? Check all that
apply.
Answer Choices Responses
Diwali 36.19% 38
Birthdays 56.19% 59
Christmas 23.81% 25
Anniversaries 25.71% 27
Wedding Season 22.86% 24
Sales 77.14% 81
Valentine's Day 17.14% 18
Pre-Vacation 36.19% 38
 Other (please specify) 7.62% 8
Answered 105
Table 2: Preferred occasion at which consumer buy online
Source: Primary Data

Inference:
The occasion on which customers prefer to buy the most is during sales 81 out of 105 customers
are most likely to buy online during sales followed by birthdays and the least likely event they
prefer to buy on is Valentine’s Day with 17.14%. Hence price being the second most important
factor that affects the shopping experience of customers online the occasion when customers are
most likely to buy the most is also during sales as it would enhance their shopping experience.

3.7 Occasions at which Consumers prefer to shop from malls

In Table 6 the purchasing habits portrayed by the customers in shopping malls are shown. The
occasions during which they are most likely to buy from shopping malls is what is analysed here.

Table 3: Occasions on which customers are most likely to buy from shopping malls
Conversely, when are you most likely to shop at MALLS? Check all that apply.
Answer Choices Responses
Diwali 37.14% 39
Birthdays 40.95% 43
Christmas 16.19% 17
Anniversaries 16.19% 17
Wedding Season 40.95% 43
Sales 70.48% 74
Valentine's Day 15.24% 16
Pre-Vacation 33.33% 35
Other (please specify) 2.86% 3
Answered 105
Source: Primary Data

Inference:
The Table 6 shows that the most likely occasion when the customers would prefer to buy from
shopping malls is on the time of sales but subsequently 43 out of 105 respondents also are most
likely to buy during birthdays and wedding seasons. The least likely events when they would buy
from shopping malls are during festive seasons like Christmas and Valentine’s Day.
3.8 Products customers prefer to purchase online
Graph 6 shows the products that customers tend to buy online and to understand what products
customers are willing to buy online and what are the products that are least likely to be bought
online
Graph 6: Products customers prefer to purchase online

Of the following items, which do you prefer to purchase

ONLINE? Check all that apply.
90.00%
80.00%
70.00%
60.00%
50.00%
40.00%
Responses
30.00%
20.00%
10.00%
0.00%
el ies ok
s cs es cs gs ry oe
s es s e
ify
)
ar or eti nc ni in lle m rie icin c
pp ss Bo m r a
ctr o sh e Sh
Ga ce
ed sp
e
A ce Co
s ag ni Je
w o ro
Ac Fr Ele fur d e G M se
e Vi ea
m (pl
Ho he
r
Ot

Inference:
As shown in the above graph 7 books are the most preferred item that customers tend to buy
online. 60 out of 105 respondents are likely to buy accessories and electronics too. The least
preferred product to buy online is medicine with 16.19% people willing to buy it. (see Table 6 in
Appendix B)

3.9 Products customers prefer to purchase in malls

Graph 7 shows the products that customers tend to buy from shopping malls to study what the
customers prefer to buy from shopping malls

Graph 7: Products customers prefer to purchase in malls

 Of the following items, which do you prefer to purchase
in MALLS? Check all that apply.
70.00%
60.00%
50.00%
40.00%
30.00% Responses
20.00%
10.00%
0.00%
el s s
tic
s
ce
s cs gs er
y s es s e
ify
)
par orie o ok e n o ni h in ll h oe am erie icin
ec
ss B a we S oc ed
Ap ce sm ag
r ctr ni
s
Je
G
Gr es
p
A c Co Fr Ele fur d eo M s
e Vi lea
m (p
Ho he
r
Ot

Inference:
64.76% customers prefer to buy Apparels from shopping malls whereas only 17.14% customers
buy books from shopping malls. Fragrances’ is another product that customers tend to buy from
shopping malls along with jewellery, shoes and home furnishing. (see Table 7 in Appendix B)

3.10 Reasons apart from shopping customers go to malls

To determine the reason why people, visit the malls expect for shopping is shown in table 9.

Table 4: Reasons apart from shopping to visit malls

What are the reasons APART from shopping do you visit MALLS for? Check all that apply
Answer Choices Responses
To watch movies 83.81% 88
To eat at restaurants 83.81% 88
To window shop 53.33% 56
To socialize 44.76% 47
To Showroom (visit a store in the mall to try a product before buying it 43.81% 46
online at a lower price)
To see or take part in some event organised by the mall 21.90% 23
 Other (please specify) 0.00% 0
Answered 105

Inference:
The reasons why people visit malls is usually for entertainment purposes such as watch movies,
eat at restaurants, to window shop etc. 83.31% of the people visit shopping malls for the purpose
to watch mov*ies and to eat at restaurants. Window shop is the next top reason why people go to
the malls. Whereas only 21.9% go to the malls to attend or take part in an event organised the
mall.

4. Conclusions
The main objective of this paper was to observe if customers had a certain inclination towards
either shopping online or in malls; in order to analyse the reasons why people shop online,
frequency of their visit to online sites and shopping malls, what do consumers prefer to shop
online and from malls, the occasion at which they prefer to buy and what are the other reasons
associated with people visiting malls except shopping.
The findings of this study suggest that there is equal preference for both shopping malls and
online shopping. Yet, frequency of shopping online is much higher than that from shopping
malls. Most frequently occurring reason for online shopping to be more frequently is practiced is
because of the reoccurring sales and wider variety of products available along with convenience
to buy the products without any geographical constraints. Birthdays are one of the major
occasions along with sales that people tend to buy online. Whereas when it comes to festive
seasons like Christmas and wedding season’s people prefer to buy from shopping malls. Online
has an edge in selling of books, accessories and electronics whereas consumers prefer to buy
apparels shoes and fragrances from shopping malls. The main reason apart from shopping for
consumers to visit the malls is for entertainment proposes mostly to eat at restaurants and watch
the movies
The results of the present study may provide important implications for developing strategies for
shopping mall managers to compete directly to online retailing, the research results suggest that
traditional retailers must expedite the service as well as trend setting.

5. Recommendations
Based on the findings of the study the following suggestions are given by the researcher to
overcome the problems faced by malls regarding rise of online shopping:
 Shopping experience should be more time-efficient than the present day regional mall.
High speed processing and self-service with internet type environment will be preferred.
 Innovative product information should be available in stores; otherwise customers will
try to get it from the internet. So, making product information available to consumers
may be an important tool that directly affects sales.
 Malls should try and capitalise on its physical presence over online shopping by
providing sufficient eat out options that meets the expectations of different shopping mall
visitors. Furthermore, the retailers at the shopping malls should develop promotional
 programs that make shopping mall visitors to perceive shopping mall eat out options as
venues to celebrate special occasions.
Essentially, Indian malls should revamp their structure and market itself no longer as a place to
shop, rather a place of experience.

6. Limitations
In this paper, a non-probability sample method was used which served as a limitation, because
findings cannot be generalized to the population. Future studies should endeavour to include a
more representative sample of shopping mall visitors. Furthermore, the reasons apart from
shopping customers visit malls can be studied in far more depth.
Appendix A-Questionnaire
 Appendix B- Tables

Table 1: Preference between shopping mall and online shopping

Answer Responses
Choices
Online 48.57% 51
Malls 51.43% 54
Answered 105

Table 2: Frequency of shopping online

Answer Choices Responses

More than once a week 18.10% 19
Once a week 3.81% 4
2-3 times a month 19.05% 20
Once a month 22.86% 24
Less than once a month 17.14% 18
As little as possible 16.19% 17
Never 2.86% 3
Answered 105

Please rate the importance of the following influences on your ONLINE shopping
experience (1 being the LEAST important, 5 being the MOST important)
  1 2 3 4 5 Total Weighted
Average
Price 2.86% 3 2.86% 3 16.19% 17 37.14% 39 40.95% 43 105 4.1
Selection (Variety 1.90% 2 4.76% 5 11.43% 12 34.29% 36 47.62% 50 105 4.21
and choice of
products available)
Convenience (Can 4.76% 5 10.48% 11 14.29% 15 22.86% 24 47.62% 50 105 3.98
shop from comfort
of your home)
Time (Delivery 6.67% 7 19.05% 20 26.67% 28 24.76% 26 22.86% 24 105 3.38
Time)
Customer Service 29.52% 31 12.38% 13 18.10% 19 21.90% 23 18.10% 19 105 2.87
Financial Security 6.67% 7 6.67% 7 20.00% 21 14.29% 15 52.38% 55 105 3.99
(Secure payment
system)
Answered 105
Table 3: Factors affecting online shopping experience
 Table 4: Frequency of visiting the mall for shopping
How often do you shop in MALLS?
Answer Choices Responses
More than once a week 0.00% 0
Once a week 1.90% 2
2-3 times a month 8.57% 9
Once a month 41.90% 44
Less than once a month 30.48% 32
As little as possible 12.38% 13
Never 4.76% 5
Answered 10
5

Please rate the importance of the following influences on your MALL shopping
experience (1 being the LEAST important, 5 being the MOST important)
  1 2 3 4 5 Total Weighte
d
Average
Price 2.86% 3 5.71% 6 18.10 1 31.43 3 41.90 4 105 4.04
% 9 % 3 % 4
Selection (Variety 0.95% 1 6.67% 7 15.24 1 28.57 3 48.57 5 105 4.17
and choice of % 6 % 0 % 1
products available)
Convenience 14.29 1 17.14 1 28.57 3 20.00 2 20.00 2 105 3.14
(Items I normally % 5 % 8 % 0 % 1 % 1
buy are all under
one roof)
Time (Immediate 22.86 2 8.57% 9 23.81 2 22.86 2 21.90 2 105 3.12
access to product) % 4 % 5 % 4 % 3
Customer Service 25.71 2 9.52% 1 13.33 1 20.00 2 31.43 3 105 3.22
(Can ask for % 7 0 % 4 % 1 % 3
product advice)
Financial Security 12.38 1 4.76% 5 15.24 1 21.90 2 45.71 4 105 3.84
(Secure payment % 3 % 6 % 3 % 8
system)
Answere 105
d
Table 5: Factors influencing mall shopping experience

Table 6: Products preferred to be purchased online

Of the following items, which do you prefer to purchase ONLINE? Check all
that apply.
Answer Choices Responses
Apparel 39.05% 41
Accessories 57.14% 60
Books 83.81% 88
 Cosmetics 38.10% 40
Fragrances 25.71% 27
Electronics 57.14% 60
Home furnishings 25.71% 27
Jewellery 23.81% 25
Shoes 47.62% 50
Video Games 25.71% 27
Groceries 25.71% 27
Medicine 16.19% 17
Other (please specify) 0.95% 1
Answered 105

Table 7: Products preferred to be purchased in malls

Of the following items, which do you prefer to purchase in MALLS? Check all
that apply.
Answer Choices Responses
Apparel 64.76% 68
Accessories 36.19% 38
Books 17.14% 18
Cosmetics 38.10% 40
Fragrances 52.38% 55
Electronics 26.67% 28
Home furnishings 40.95% 43
Jewellery 44.76% 47
Shoes 49.52% 52
Video Games 18.10% 19
Groceries 41.90% 44
Medicine 29.52% 31
Other (please specify) 0.95% 1
Answered 105
Bibliography
Donald R. Cooper, P. S. (2011). Business REsearch Methods. McGraw-Hill/Irwin.

Khare, A. (2011). Mall shopping behaviour of Indian small town consumers. Journal of Retailing and
Consumer Services.

Maheshwari, R. (2016, Febuary 18). Indian ecommerce market to grow fastest globally over 3 years:
Morgan Stanley . The Economic Times.

Makgopa, S. (2016). Determining consumers’ reasons for visiting shopping malls. Innovative Marketing,
12(2).

Mathew, B. (2015). A Study on Changing Trends in Online Shopping of. International Journal of Applied
Research, 1(9).

S, R. (2014). ASSESSING THE IMPACT OF ONLINE RETAILING. GALAXY International Interdisciplinary

Research Journal, 2(1).

Tecli, E. (2013). High shopping mall patronage: is there a dark side? Quality & Quantity, pp 2517–2528.

Tiwari, A. (2015, May 19). Malls face uncertain future as customers desert them. DNA India.