INTRODUCTION

1.1 Introduction
With the advent of information technologies and emergence of online stores, online
shopping has not been the same as it was in the past. Owing to the fast moving lifestyle,
online shopping has been a growing phenomenon in all across the world. It has changed the
way consumers shop for good & services. Consumers are using online shopping not just to
buy goods and services, but also to browse online shops or to attain knowledge about
potential purchases. Online shopping is the process whereby consumers directly buy goods
and services from a seller interactively in real-time without an intermediary service over the
internet. Consumers can visit online stores from the comfort of their homes and shop as they
sit in front of the computer. With one click, customers can glance, the information regarding
the product and services. Buyers today are only a click away from comparing competitor‘s
product and attributes. Today's consumer can order almost anything online. Consumers buy
a variety of items from online stores. In fact, consumer can purchase just about anything
from retailers that provide their products online. With the development of the online
revolution and the shift in buying behavior among the consumers, the increase of online
shopping has become a trendy way for consumers and retailers to trade online.
Online shopping is a recent phenomenon in the field of e-business is gaining interest &
attractiveness and is definitely going to be the future of shopping in India. E-retailers are
running their online portals to sell their products and services online. Over the past few years
online shopping has increased the percentage of e-consumers’ in India. Statistics show that
the amount of consumer purchasing online is rising and the quantity of their purchases also
increasing rapidly. Online shopping is very common outside India, it is going phenomenally
in India, which is a large and strategic consumer market. As the competition is intensified
in online shopping, it becomes more important for e-retailers to understand the antecedents
of consumer acceptance of online shopping. Such a knowledge is essential for customer
relationship management, which has been recognized as an effective business strategy to
achieve success in online shopping. E-retailing is buying and selling products and services
over internet. E-Tailing offers extensive opportunity in developing countries like India.
Highly intense urban areas with very high literacy rates, an enormous rural population with
a fast increasing literacy rate, a rapidly growing internet user base, technology advancement,
stumpy cost of personal computers, and a progressively more competitive Internet Service

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market has added fuel to the fire in augmenting e-tailing growth in India. E-retailing is a
new medium of shopping in India and a rich segment waiting to be explored. For businesses,
the key to survival in the future depends on how well they can integrate this medium in their
business model today. Many traditional Indian electronics store formats like Croma &
Ezone have entered into e-tailing

E-Consumer behavior refers to the process of purchasing products or services using the
Internet. In the online shopping process, when potential consumers recognize a need for
some product 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. The major objectives of e-
retailers are to identify the factors influencing e-consumer behavior. Analyzing consumer
behavior is not a new phenomenon. The theories of consumer behavior have been used by
many years not only to understand the consumer, but also creates a marketing strategy that
will attract the consumers efficiently. Retailers have moved to incorporate an online
shopping to add value to the customer by offering the facility of online purchasing.

Several studies were conducted 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. These studies have all made important contributions to our
understanding of the dynamics of the online shopping field. However, there is a lack of
coherent understanding of the impact of relevant factors of e-consumer behavior and an
inconsistent identification of relevant independent and dependent variables. This makes
comparisons of different studies difficult, applications of research findings limited, and the
prospect of synthesizing and integrating the empirical literature in this area elusive.
The present study has been initiated with the objective to study e-consumer behavior
towards online purchases of electronic products. The main objectives of the study are to
study the demographics, comparison of different e-retailers on the basis of trust, discount,
schemes, service and quality, perception with reference to experience. The purpose of this
study is to examine e-consumers buying behavioral patterns towards online shopping and to
analyze factors affecting e-consumer behavior. The research on e-consumer behavior is
important because it helps to understand when and how online consumer prepares

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themselves for purchasing. This research helps to assess the ability of e-retailers in order to
attract and retain the e-customer, to analyze the shift in buying behavior and to explore the
reasons why existing and potential customers do not prefer online shopping.

1.2 Research Background

Michael Aldrich invented online shopping in 1979, which allowed consumers, customers,
agents, distributors, suppliers, and service companies to be connected on-line to the
corporate systems and allow business transactions to be completed electronically in real-
time. Online shopping has grown almost fivefold since 2000. Nearly two-thirds of
consumers are internet users and over half of these had used online shopping to make
purchases. Online shopping has as a huge potential channel, since it allows interaction with
consumer offering them a totally different shopping experience to traditional shopping. A
highly demanding lifestyle is compelling consumers worldwide to adopt internet shopping
as an alternative to traditional brick and mortar shopping. Consumer have different
preferences for the products and services offered on a market or respond differently to a
marketing action, companies can increase huge profit by using a commercial strategy (Smith
1956). E-retailing is a form of multi-channel retailing, which can now be used to gain access
to a wider market (Kim & Park, 2005). Opening up online shops brings about great
advantages as many consumers are leaning towards online shopping. It provides a very
flexible way to sell products and services (Doherty & Ellis-Chadwick, 2006). E-retailing is
unanimously accepted and acknowledged as a cost-effective, profitable and accessible
medium to shop. It therefore becomes imperative for e-retailers to study e- consumerism
and how it is taking shape in today’s era of rapid globalization.

Dougal Rogan (2007) illustrated the relationship between consumer behavior and marketing
strategy. He stated that the strategy is about increasing the probability and frequency of
buyer behavior. Realizing the importance of e-retail, e-retailers would like to discover
business opportunities and to bring back customers. As such, it is very important to
understand e-consumer behavior and the factors affecting the behavior. In the consumer
behavior research literature for the traditional shopping environment, researchers suggested
that there are different groups of factors influencing a consumer buying behavior. Kotler et
al. (1999) framework best described all these factors, namely, cultural factors, social factors,
personal factors and psychological factors (Kotler et al., 1999). In the new market created,

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by e-retailing, consumers find the new way of making their purchases. This new virtual
market will bring significantly different experiences to consumers. As such, in the online
shopping environment, although the four groups of factors are still influencing consumer
buying behavior, it is obvious that the way of influencing, i.e., how these factors influence
consumer online shopping behavior, will differ from that in the traditional shopping
environment.

Most of the research works focus on e-consumer perception of the online shopping as a new
shopping way. They suggested that different perceptions about online shopping will lead to
different online purchase decisions. However, there are areas worth to study, but lacking of
attention from researchers. Although current studies include perceived risk and study how
risk perception will influence e-consumer purchase decisions (Cheung and Lee, 2000; Kim
and Prabhakar, 2000; Pavlou, 2001), it is still difficult to bring the results to practice. The
study of product differences in consumer online adoption behavior. While marketing
researchers have long suggested that a traditional shopping environment, consumers would
behave differently when purchasing different products (Berkowitz et al. 1997), it is believed
that, in the online environment, the same observation will hold, that is to say, different
products will have different effects on e-consumer behavior. The expected results would
help us to understand the different effects of different products and to understand how we
could use the internet to better present and sell different products. Companies from product
and services business would be able to design their strategies based on the nature of their
products and effectively market their products through the online channel. E-consumer
perceptions on products in the online shopping environment, and also it lacks of a study of
consumer risk perceptions of online shopping in product business (physical goods).
Tremendous efforts have been put into the study of consumer perceptions on products in the
traditional shopping environment. Researchers reveal the importance of these perceptions
of products on consumers' purchase decision making (Chang and Wildt, 1994). Thus, it is
believed that how consumers perceive the product sold over the Internet probably will also
influence their online purchase decisions.

(Pavlou, 2001) investigate the factors influencing consumer’s intention to adopt online
shopping as a new purchase method. They focus on consumer perceptions about online
shopping, the new way of making purchases. However, there is one question in our mind,
even if consumers accept the idea of online shopping, would they make actual purchases
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online. Would the product itself affect consumers' online purchase intention? In current
research studies, only modest efforts have been devoted to examining consumer perceptions
on products. There is a knowledge gap between e-consumer behavior in the traditional
environment and that in the online environment. As the number of people using the online
shopping for their shopping steadily rises, it is increasingly important for e-retailers to
understand why consumers decide to buy products online or offline. The online growth rates
still indicate that the online channel will play a more profound role in e-consumers shopping
activities. Inarguably, online channel presents different shopping experiences, even when
the same products are purchased (Wolfinbarger and Gilly 2001). As there has been a
paradigm shift in the buying channels, i.e. from physical space to the digital space and sellers
have moved online shopping. Hence there is a lot of potential emerging in the market for
the e-retailers to study on the factors of e-consumer behavior. At any given time there are
millions of people online and each one of them is a potential customer for e-retailer
providing online sales. Due to the rapid development of the technologies surrounding the
online. Since there are many potential customers, it is of outmost importance to be able to
understand what the customer wants and needs. The importance of analyzing and identifying
factors that influence the consumer when he decides to purchase online is important. Since
online shopping is a new medium there have been new demands set by the consumers.
Furthermore, analyzing e-consumer behavior is not a new phenomenon. Hence,
understanding and identifying the e-consumer is closely related to the directions e-retailer
will take their marketing strategy. Moreover, e-consumer behavior is diverse from
traditional consumer behavior one must identify what influences the online consumers. The
factors need to be identified and taken into account by e-retailers in order to satisfy consumer
demand and compete in the online market.

E-consumer plays a pivotal role in online shopping. The increasing use of online shopping
by the youths in India provides an emerging prospect for e-retailers. If e- retailers know the
factors affecting e-consumer behavior, and the associations between these factors and type
of online buyers, then they can further develop marketing strategies to convert potential
customers into active ones. Hence this research study enables the factors influencing e-
consumer behavior that might help e-retailers to segment target group to increase their usage
of online shopping.

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1.3 Statement of the Problem
Tim Berners-Lee in 90’s developed the first web server and browser and the concept of
online shopping developed gradually, after this launch. Amazon in 1995 launched its first
online shopping website, and in 1996, e-Bay was founded. Online shopping is changing the
way consumers shop and buy goods and services, and has rapidly evolved phenomenon.
Many Retailers have started using the online shopping with the aim of cutting marketing
costs, thereby reducing the price of their products and services in order to stay ahead in
highly competitive markets. Retailers also use the online shopping medium to convey
marketing communication, to circulate information, to sell the product, to get consumer
feedback and also to conduct consumer satisfaction surveys. Customers utilize online
shopping to purchase products online, to check reviews, to compare prices, product features
and after sale services if they purchase the product from a particular e-retailer.
Many marketers are opportunistic about the future of online shopping. In addition to the
vast potential of the E-retail market, online shopping provides a unique opportunity for e-
retailers to most efficiently reach existing and potential customers. It has been more than a
decade since e-retailing first evolved. Research scholars and marketers of e-retail industry
is constantly making great efforts to gain an improved insight into e-consumer behavior.
Along with the development of E-retailing, researchers continue to explain E-consumers
behavior from different perspectives. Many of their studies have posited new emergent
factors based on the traditional models of consumer behavior and then examine their validity
in the online context. E-retailing has created into a new distribution channel and online
transactions are rapidly growing. This has created a need to understand consumer
perception, experience & expectations towards online shopping, Trust, Discounts, Schemes,
Service and Quality were identified as an important factor. Online shopping has created a
prime shift of the traditional way consumers shop. A consumer is no longer bound to open
at times or specific location and he became active virtually any at time, at any place to
purchase the products or services.

The e-consumer market is witnessing an unprecedented consumption boom. At the same

time, technology enhancement has increased capacity of e-retailers to collect, store,
maintain, transfer & analyze huge amounts of data of their web visitors. The improvements
in income dynamics along with factors like favorable demographics and spending patterns
are driving the consumption demand. The more experience online consumers have with the

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Internet, the more money they are likely to spend shopping online. Online shopping in India
is in a very nascent stage and fewer studies have been conducted on e-consumer behavior.
Although there are have been the scarcity of online shopping related studies in India,
Internationally in other countries various studies carried. E-consumer behavior is a broad
and interesting area of study that can benefit e-retailers in their efforts to market and sell
products online. As consumers’ attitude towards online shopping is a prominent factor
affecting actual buying behavior out on e-consumer behavior. This study was conducted to
understand e-consumer behavior towards online purchases of electronics products in
Maharashtra state.

1.4 Justification for Research

This research can be justified by following important means; a research gap in the literature
on e-consumer behavior, the significance of the online shopping (e-retail) industry to the
Maharashtra state & Indian economy, the research tools & techniques used, and the utility
of the findings. While there are many research studies conducted on consumer behavior &
different aspects of online shopping. However, there is a gap in the literature with limited
studies or no studies on the e-consumer behavior towards online purchases of electronic
products in Maharashtra state. This study will contribute to the existing knowledge of
consumer behavior to the study of e-consumer behavior by seeking to establish the degree
of alignment between theory and the application of e-consumer behavior towards online
purchases of electronic products in Maharashtra state.

The e-retailing industry have major dominance in Maharashtra state as well as in entire
India. The e- retailing industry in India is fragmented with a few large players at the top and
race for higher valuation has led to fierce competition and aggressive growth. According to
India’s ecommerce industry report, a major rise online population significantly, accounting
for e-retail growth. Compared to western countries, India’s e-retail industry is still in a
nascent stage, but it is believed that it may become a one of the largest in the world. E-
retailers tend to trade at high multiples of forward earnings due to the very nature of high
growth estimates in comparison to traditional brick and mortar businesses. This research
study throws light on e-consumer behavior of electronic products in Maharashtra state which
will help e-retailers to compete aggressively to gain brand recognition and customer loyalty,
and the way to grow with the market.

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1.5 Objectives of the study
The aim of this research was to study e-consumer behavior towards online purchases of
electronic products specially Mobiles, Tablets & Laptops in the metro cities of Maharashtra
state. This research analyzed the factors that influence e-consumer behavior towards the
electronic products. The general objective of this paper is the identification of factors that
lead to the purchasing decisions of electronic products online. Also determine the
demographic profile of online shoppers in Maharashtra state and to draw e-consumer
perception about e-retailers on perceptual maps.

The key objectives of the study are:

 To Study the Demographic Profile of e-Consumers.

 To study the Comparison of different e-retailers on the basis of factors trust,

discounts, schemes, service, & quality parameters.
 To study the Perceptions, Experiences & Expectations of e-consumers towards e-
retailers.
 To study the impact of various promotional strategies on e-consumer purchase
decisions.
 To study factors that influence e-consumer behavior.

1.6 The Conceptual Framework

The proposed model for the study was developed to examine the process of e-consumer
behavior towards online purchase of electronic products. The conceptual framework is a
strategies and plan structure which used for investigations to obtain answers to the questions
that related to a research study. E-consumer behavior is influenced by numerous factors.
Figure 1.6.1 demonstrates a proposed research model of important determinants that
influence a consumer’s behavior to purchase online. This proposed model builds on the
determinants- external environment, demographics, trust, price-discounts, schemes & COD,
quality & service, and marketing influences. Furthermore, the proposed model that
incorporates the e-consumer behavior process the dimensions to be studied are perception
towards online shopping, Intention to shop online, decision making, online shopping-
satisfaction, experience & expectation and post purchase decisions as illustrated in Figure
1.6.1. The continued success of online shopping will be determined by the degree to which
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consumers utilize the Internet during their decision making process, mainly the acquisition
of product information. To understand e-consumer behavior in this unique e-retail
environment, relevant theoretical perspectives are drawn to provide a conceptual framework
that provides an explanation of e-consumers online purchase behavior.

Figure 1.6.1: Conceptual Framework of the Research

In an environment characterized by human-computer interaction, several contents of the

conceptual framework are discussed below.

 External environment: The external factors influencing e-consumer behavior

includes psychological factors, cultural and social factors
 Demographics: Demographic segmentation relevant variables for identifying the e-
consumer are age, gender, size of family, family life cycle, income, job, education
and generation.
 Trust: Trust is essential in building any relationship with customers. There seems
to be however a diminishing trust in e-retailers. This is especially true when it comes
to smaller, niche stores. E-consumers focus on large giants, e-retailers with big
brands behind them and don’t apply the same level of trust to a smaller e-retailers.

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 Price: In addition to the rapid growth of the Internet population there has been an
emphasis on Internet exchanges occurring at lower prices than in conventional
outlets. Online shopping fascinates consumers with the cheap deals and best prices.
The products come direct from the manufacturer or seller without middlemen
involved. Price is a form of monetary that people use for any transactions. In an
online context, consumers are more likely to depend on the price cues to determine
the quality of a product which are presented on the web site because they cannot see
or touch the actual product.
 Quality & service: E-consumer satisfaction will also depend upon product quality
and service. Quality is the totality of features and characteristics of a product that
bear on the ability to satisfy implied needs. A retailer that satisfies most the e-
consumers’ needs most of the time is called a quality e-retailer. The service is a key
tool differentiating one tool from another. E-retailers also need to consider
differentiation based on reliable consumer service.
 Marketing Influences: The key to greater marketing impact for e-retailers today e-
consumer is knowledge and insight. In order to maximize marketing influences, e-
retailers need to know what categories and what brands are being promoted, by
whom, at what price points and how often they are changing. Since online
promotions will only continue to grow; successful e-retailers need to be strategic and
informed in their approach. When there is the presence of promotional offers,
consumers will have higher intention to purchase online; purchasing decisions and
choice making from alternative evaluations can be made easily when there is the
presence of promotional offers.
 Perception towards online shopping: The e-consumer's perception towards
shopping online is also a factor to consider. When the consumer’s experience
exceeds their expectations, there is a high chance they will become loyal towards
that particular e-retailer. The e-consumer’s perception will also vary depending on
what kind of product they are looking to purchase. The e-consumers’ perception will
vary depending on the type of product because the risk factors are different for each.
Other factors which may affect the perception of e-consumer are: how exposed they
are to the market, market ambiguity and the position of competitors in the market.
 Intention to shop online: Intention to shop online are formed through the attitude
toward a behavior and subjective norms lead to actual behavior given the availability

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 of resources and opportunities. A person's interest in performing a particular
behavior is reflected by the attitude toward a behavior and it is determined through
behavioral beliefs; these beliefs are obtained through a cognitive evaluation of
outcomes associated with performing the behavior and the strength of the association
between outcomes and behavior; while the evaluation produces either a favorable or
unfavorable response to the object, person, thing or event.
 Decision making: The e-consumer forms preferences among the brands offered by
preferred e-retailers in the choice set. The e-consumer may also form an intention to
buy the post preferred brand. In executing the decision making online, the e-
consumer may make up by five sub decisions: brands, e-retailer, quantity, timings
and payment methods.
 Satisfaction, Experience and Expectations: Satisfaction is based on a number of
features such as: how fulfilling the experience was, how smooth the transaction was
and the ease of interaction. Satisfaction is defined as the perception of pleasurable
fulfillment in the consumers’ transaction experiences. E-consumer experiences are
an important part of consuming and shopping. E-consumers are not always simply
looking to buy products, but also want to get pleasure from the shopping activity.
This experience is affected by the customer’s shopping goals, what they expect, and
what their motivations. Motivation for shopping online is an important factor to
consider when analyzing the shopping experience. E-retailers strive to constantly
improve their online services for consumers. A sound service delivery will have
great positive impacts on the experience of an e-consumer. If performance falls short
of expectations, the e-consumer is disappointed; if it meets expectations, the e-
consumer is satisfied. These feelings make a difference whether the e-consumer buys
the product again and talks favorably or unfavorably to other consumers.
 Post purchase decisions: After online purchase, the e-consumer might experience
dissonance that stems from noticing certain disquieting features or hearing favorable
things about other brands and will be alert to the information that supports e-
consumers post purchase decisions. If the e-consumer is satisfied, is more likely to
purchase from e-retailers again. On the other hand, dissatisfied consumers may
abandon the e-retailer.

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1.7 Hypothesis Development
In order to study the impact of Demographic factors and e-consumer behavior, the
relationship between Discounts & e-consumer’s purchase decisions, the relationship
between Trust & e-consumer’s willingness to buy, the impact of cash on delivery on
consumer purchase decisions and the relationship between marketing influences & e-
consumer purchase decisions. The hypothesis developed are tabulated below.

Table 1.7.1: Research Hypothesis

Hypothesis
Hypothesis 1 Demographic factors of e-consumers significantly impact the e-
consumer behavior

Hypothesis 2 There is a significant relationship between the Discounts (Lower

Price) and the e-consumers purchase decisions

Hypothesis 3 Trust positively affects the e-consumer behavior towards willingness

to buy from e-retailers.

Hypothesis 4 Cash on Delivery is a most preferred payment option by e-consumers

Hypothesis 5 There is a significant relationship between the marketing influences

& the e-consumer purchase decisions

All hypothesis of this research study have interrelationships with main objective online
purchases, in order to ease in statistical analysis of suitable conclusions. Five hypotheses
which significantly impact e-consumer behavior and e-consumer purchase decisions are
addressed in this section.

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1.7.1 Demographic factors of e-consumers significantly impact the e-
consumer behavior:
Research of the e-consumer has typically included demographic questions of age, education
and household income (Fram & Grandy, 1995). Over time the e-consumer, once considered
the innovator or early adopter, has changed. While once young, professional males with
higher educational levels, incomes, tolerance for risk, social status and a lower dependence
on the mass media or the need to patronize established retail channels (Mahajan, Muller &
Bass, 1990), todays e-consumer shows a diversity of income and education (U. S. Dept. of
Commerce, 2003). For e-consumers, gender, marital status, residential location, age,
education, and household income were frequently found to be important predictors of online
shopping (Fram & Grady, 1997). Sultan and Henrichs (2000) reported that the e-consumer’s
willingness to and preference for adopting the Internet as his or her shopping medium was
also positively related to income, household size, and innovativeness. Akhter (2002)
indicated that more educated, younger, males, and wealthier people, in contrast to the less
educated, older, females, and less wealthier are more likely to adopt online shopping.
Identification of consumer and demographic factors which affect e-consumer behavior has
been a thrust area of past researches (Peterson et al., 1997). Based on these arguments, study
hypothesized as follow:

 H1: Demographic factors of e-consumers significantly impact the e-consumer

behavior

1.7.2 The relationship between the Discounts (Lower Price) and the e-
consumers purchase decisions:
Among the variables that affect e-consumer’s purchase decision is the price, which has a
significant influence on communication factors concerning the advantages of online
shopping. Price is a factor that influences the product evaluation process, as it is present in
every purchasing situation, and represents the amount of economic effort that has to be made
to ensure a satisfactory purchase (Lichtenstein, Ridgway & Netemeyer, 1993). Price can be
accompanied by a discount, which increases the perceived value of the product for the
purchaser. Serpa and Avila (2004) explain that the way price is presented can have a strong
impact on e-consumers purchase decision-making. The high benefit level price discounts
are more effective than premiums, while low benefit level price discounts are a less effective

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way to increase purchase intention (Palazon & Delgado, 2009). Degeratu, Rangaswamy and
Wu (2000) found that online consumers are more price-sensitive than offline consumers.
Kannan and Kopalle (2011) added that it is easier to offer customized promotions that are
targeted at individual consumers online. This distinction between different kinds of
consumers suggests that retailers should use different types of price promotion online
(Ailawadi, 2009). On the basis of this, the following hypothesis put forward:

 H2: There is a significant relationship between the Discounts (Lower Price) and
the e consumers purchase decisions

1.7.3 Trust positively affects the e-consumer behavior towards willingness

to buy from e-retailers:
Understanding the nature of trust is a major issue for both Internet researchers and
practitioners since online shopping is a relatively new phenomenon with enormous
potential. Both economists and sociologists agree that trust is a crucial enabling factor in
relations where there is uncertainty, interdependence, and fear of opportunism as is the case
in online markets. Research on trust has attracted much attention in the online consumer
behavior literature (Gefen, Karahanna and Straub, 2003). Online trust research has included
understanding the components of trust in relation to the Internet as a medium (Olivier,
Benoit and Aubert, 2001) and the online vendor (Chen and Dhillon 2003) to determine the
measures of uncertainty and risk of loss (Ahuja, Gupta and Raman 2004). Trust in online
shopping has been linked to the Internet being trustworthy in terms of the perceived
usefulness of the information (Song and Zhang 2004) and the security of the transaction
(George 2004). Risk of consumer loss online can occur during search and evaluation
component of the buying decision process with respect to incomplete or incorrect product
and pricing information, during the transaction if the vendor is unethical, and during
delivery where the product may be damaged (Grabner-Kraeuter 2002). Thus, trust in the
online consumer context manifests when tangible or intangible cues are used to reduce
uncertainty and risk throughout the buying decision process (Tan and Sutherland 2004).
Therefore, following hypothesis proposed in this regard:

 H3: Trust positively affects the e-consumer behavior towards willingness to buy
from e-retailers.

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1.7.4 Cash on Delivery is a most preferred payment option:
Cash on delivery payment option has been the transformation that has added a lot of
momentum to online shopping and improved e-consumer perception towards online
shopping. It addressed two important issues regarding with payment which e-retailers faced.
Earlier, many e-consumers feared sharing their credit/debit card details over the internet
which was proving to be a major impediment in online shopping. Cash on delivery enabled
buyers to purchase without disclosing their credit/debit card details by allowing the
customers to make payments when products were delivered. Eventually, even those who
possessed credit card have started preferring to shop online using Cash on delivery. It is
suggested that 60 percent of Indian e-consumers who owned credit cards, still preferred to
transact through Cash on delivery in their most recent purchases (Boston Consultancy
Group, 2013). More than 50 percent of all online transactions in India was based on the
Cash on delivery payment option. Cash on delivery was also contributory in reaching out to
customers in tier-II and tier III cities where most of the customers did not have credit/debit
cards. The perspective with which a customer from tier-II and tier-III cities shopped was
quite different from the way metropolitan customers shopped online. A customer from
metropolitan area would shop online because she found it convenient and it saved time.
However, tier-II and tier-III city customers shopped online as these customers were unable
to access the choices they had aspired for at the cities where they lived. By giving the option
to make payment by Cash on delivery, e-retailers were able to quickly build upon the
untapped demand of aspiring customers. Therefore, following hypothesis proposed in this
regards:

 H4: Cash on Delivery is most preferred payment option by e-consumers

1.7.5 The relationship between the marketing influences & the e-consumer
purchase decisions:
Marketing is a platform for marketers to create awareness and influence purchase decision
of the consumers. It provides a way to entice consumers to visit the e-retailers’ site by
clicking on the banner or button on the web site. The purchase decision is that decision
making processes undertaken by consumers in regard to a potential market transaction
before, during, and after the purchase of a product. Virtually each consumer grows up in the
world which is flooded with the mass media, e.g. television, advertising, films, videos,

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billboards, magazines, movies, music, newspapers, and internet. There are several other
marketing activities which are influences e-customers in making a purchase decision. Based
on this, the following hypothesis offered:

 H5: There is a significant relationship between the marketing influences & the e-
consumer purchase decisions

1.8 Research Methodology

According to Burns and Grove (2003), a research design is a blueprint for conducting a
study with maximum control over factors that may interfere with the validity of the findings.
This section consists of methodology that was followed to conduct the research and
reasoning behind it. This section of the chapter covers the research model, the population of
the study, variables investigated and how to measure them, survey measuring instrument,
methods of data collection and methods of data analysis. The purpose of this descriptive and
analytical study is to e-consumer behavior towards online purchases of electronic products
in Maharashtra state. Quantitative research method was suited mostly for current research
for face to face interview and telephonic interview.

The research design is an exploratory study which was conducted in metro cities of
Maharashtra state. This research is presented in two phases. Firstly literature reviews
followed by empirical study. The research methodology is briefly mentioned in this section
but Chapter 2 is presented in detail covering all the aspects.

1.8.1 Research variables

Hussey and Hussey (1997) described variable as an attribute of an entity that can change
and take different values which are capable of being observed and measured. In practice the
term variable is used as a synonym to the construct or property being studied. In this context
variable is a symbol to which numerals or values are assigned.

This study consists of three kinds of variables, dependent, independent and controllable
variables. The following is the illustrations of variables in details.

 Dependent Variables
Dependent variables are the variables those values are predicted by the independent
variables. According to Shavelson (1996), the dependent variable is the variable that

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 is observed and measured in response to the independent variables and is expected
to change in the same way as levels to the independent variables change. Purchase
Decision, Trust, Perception & Brand Image were considered dependent variables of
this research study.
 Independent Variable
Independent variables stands alone and isn't changed by the other variables you are
trying to measure. An independent variable is a variable that is employed to
influence some other variable; it is an antecedent condition to observe behavior
(Shavelson, 1996). The independent variable is that variable that can be manipulated
to predict the values of the dependent variable. Discounts, schemes & offers were
considered as an independent variable.
 Control Variables
In order to ascertain their influence on the study’s sample. A number of variables
were chosen as controllable variables. Shavelson (1996) explains that control
variables are those variables are held constant. The control variables are the ones
that have potential effects on the dependent and independent variables in the study.
Control variables chosen for this study based on relationship to e-consumers
shopping behavior are demographic factors like age, gender, education, occupation
& income.

1.8.2 Research Population

Parahoo (1997) defines population as “the total number of units from which data can be
collected”, such as individuals, artifacts, events or organizations. Burns and Grove (2003)
describe population as all the elements that meet the criteria for inclusion in a study.
Sampling Population of this study comprises e-Consumers residing in Metro Cities of
Maharashtra state. A total sample of 500 e-consumers were selected as a sample. The details
of section of sample are mentioned in chapter 2 research methodology.
The criteria for inclusion in this study were:
 Sample size is 500 e-Consumers which comprise of persons of all the age groups
(Both Male & Female).
 The sample comprised of e-consumers who had done online shopping of electronic
products at least once.

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  The sample comprised of people whose minimum qualification was at least
Graduation.
 The sample was taken from metropolitan cities assuming high internet diffusion rate.
Since online purchases are done only in metro cities/ urban areas, have selected
respondents only from metro cities in Maharashtra Region.

1.8.3 Data Collection

A cross-sectional research design was used in this study since data was collected at a single
point in time. Quantitative research methods were adopted in this study with help of
questionnaires for the data collection. The detailed information about data collection is
presented below. This research considered of two sources of data Figure 1.8.1 illustrates the
data collection process utilized both forms of the data. Both secondary and primary data
were collected to make it possible to resolve the research problem. Primary data was
collected afresh and for the first time, on the other hand secondary data have already been
collected by someone and have already been passed through the statistical process.

Data
Collection

Primary Secondary
Data Data

Figure 1.8.1 Data Sources for Research

 Primary Data
Primary data consist of raw data and is especially gathered for the current research (Hair
et al., 2006). As the objective of this research study is to obtain particular information

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about a defined problem, it was decided to execute a quantitative research to collect
primary data. Quantitative research is usually associated with surveys or experiments
and is considered the primary method for the research for collecting data (Hair et al.,
2006) and the type of questionnaire depends on the methods of the survey (Chisnall,
2005). Primary data was collected with the help of structured Questionnaire. A
questionnaire is a formalized framework which consists of numerous questions and
scales which have the purpose of generating primary raw data (Hair et al., 2006, p. 429).
The questionnaire is a vital part of the survey, and the quality of the research depends
on a well-designed questionnaire (Chisnall, 2005). Furthermore, it is vital that the
questions use simple words and are short and specific. It was decided to use a highly
structured questionnaire survey with formal questions. The reason for choosing a highly
structured questionnaire survey, which consists of closed and multiple choice questions
was not just because of the nature of the research problem but because the sample size
was too large for this survey. Before the questionnaire was defined, secondary data was
studied thoroughly and a pilot testing of the Questionnaire was conducted. A survey was
conducted through E-mail, personal interviews & telephonic interviews of the
respondents.

 Secondary Data

Secondary data was collected from both internal & external sources. Internal secondary
data was collected from e-retailers & their vendors. External secondary data was
collected from Published books, Articles, Newspapers, Magazines, Research papers &
Journals. The reason for using secondary data is to save the researcher time and money
(Chisnall, 2005). It is therefore important that the researcher evaluates the information
gathered through the secondary research to find out if it is relevant to the research or
not. Secondary data used for this research study was assessed to establish the
appropriateness, quality and accuracy of the procedures adopted for finding answers to
research questions. The secondary data was assessed possess following characteristics:

 Reliability of data: The reliability was tested by finding out following things
about the secondary data: (a) who collected the secondary data? (b) What were
the sources of data collection? (c) Were the data collected by using proper
methods (d) at what time were the data collected? (e) Was there any bias of the
compiler? (t) What level of accuracy was desired? Was it achieved?

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  Suitability of data: The data that are suitable for one enquiry may not
necessarily be found suitable in another enquiry. Hence, if the available data are
found to be unsuitable, they should not be used by the researcher. In this
research, careful scrutiny was done defining of various terms and units of
collection used at the time of collecting the data from the primary source
originally. Similarly, the object, scope and nature of the original enquiry was
studied. The differences in these, the data remained unsuitable for the present
study and was not used.

 Adequacy of data: The level of accuracy achieved in data was found inadequate
for the purpose of the present research, the data were considered as inadequate
and was not used for this research. The data was considered inadequate.

The secondary data was used in this study only when it was found reliable, suitable
and adequate. The readily available data from authentic sources and also suitable
and adequate for this study was used.

1.9 Scope of the Study

The main focus of this study was to e-consumer behavior towards online purchases of
electronic products. Under this, an extensive literature survey on the background and
relevance of concept consumer behavior & online shopping was undertaken. In case of the
literature review, the information contained researches and books. E-consumer behavior is
analyzed on the basis perception, experiences and expectation & other influencing factors.
The research was conducted for e-consumers of 8 major electronics e-retailers in
Maharashtra state. The study concentrated on finding major influencing factors among the
500 e-consumers. The scope of the project is limited to Maharashtra State, as the research
has been basically carried out on the e-consumers residing in Maharashtra State only.
Though the sample has been taken from different regions, but doesn’t represent the complete
Indian scenario. The population could not represent the people from various occupations
and cultures. Though there are people from various cultures and communities the data was
not represent of all the communities in India. Recommendations were made on how to
improve quality of products & services in order to serve in the most efficient way. Minimum

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qualification graduate with the online shopping of electronic products at least once were
studied. The research instrument used was previously adopted by the researchers.

1.10 Limitations of the Study

As like most research this research study has some limitations, which need to be taken into
account when interpreting the results. The research faces several limitations that could affect
its scientific contribution are mentioned below:

 The theoretical sources from scientific articles mainly focused on the general e-
consumer behavior without a specific field. This research study was concentrated on
e-consumer behavior, but narrowed down to a specific field of the e-consumer
behavior towards online purchases of electronic products. Thus, limited sources
were used to support the research, meanwhile, through reviewing a large amount of
previous relevant researches, it was figured out the similarity and difference of the
sources, and collected the valuable ones to serve the present research.
 There are many other factors which may influence e-consumer behavior. The study
considered five important factors demographics, Perception, experience &
expectations, Promotional strategies and various comparative factors like trust,
discount, schemes, service & quality. Some other factors that may have implications
on e-consumer behavior are beyond the scope of this research.
 The study of e-consumer behavior and the factors that influence e-consumer
behavior is equally essential in order to fit the findings universally. The study
emphasized on e-consumers of electronic products only; other e-retail product
categories are untouched in the study. E-consumers were chosen from Maharashtra
state only. Other geographical locations are not included in the research study.
 The research work has time limitations due to continually changing e-retail market,
the suggestions and conclusions drawn from the study will be limited by time.
 The existence of time constraints had influenced the data collection and the sample
size. It was aimed to collect data using simple random sampling throughout
surveying e-consumers in Maharashtra state. The results are resumed for this random
sampling, which does not give the possibility to generalize what is the actual e-
consumer behavior towards electronic products at large.

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  The samples of e-consumers in this research study selected from electronics e-retail
are chosen randomly. Hence perceptions and behaviors of the selected e-consumers
may not match with the other e-consumer perceptions and behaviors, which are not
included in the research survey. To include all e-consumers was not possible in the
research study because of time limitations.
 It is the limitation of the study that a broader pool of e-consumers were not surveyed.
The numbers were restricted due to resources and time, but a wider study of e-
consumers to different geographical locations is clearly a recommendation for future
research in the area.
 Another point is that the attitude towards information seeking and comparing
products could not be separated. Therefore, it could not be determined whether the
dependent variable is affected by the attitude towards information seeking or
comparing products. It would have been more favorable if the questions about these
subjects were more different from each other to generate two different factors.
 Though the sample has been taken from different regions of Maharashtra state, but
it doesn’t represent the complete Mahrashtra and Indian scenario. The sample could
not represent the people from various occupations and cultures. Though there are e-
consumers from various cultures and communities were interviewed, but the data
was not representative of all the communities in Maharashtra.

1.11 Contributions of the Study

This study contributes to a better understanding of the e-consumer behavior by attempting
to clarify the factors that influence e-consumer behavior using appropriate statistical tools
and techniques. The research adds to the literature by developing a framework, which shows
the link between various factors which impacts e-consumer behavior. The information will
be helpful to e-retailers and e-retailers of electronic products in general for product and
brand positioning, developing a market positioning strategy for a product or service, to find
out the opportunity factor and to understand e-consumers perception, experience &
expectations. The research gives better insight on how consumers behave on the internet
and can therefore be used in future research.

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1.13 Overview of the Thesis
The thesis is organized into seven chapters followed by Bibliography and Appendices. The
organization of chapters of the research report is as follows.

Figure 1.13.1: Representation of Chapter Scheme

Chapter 1: Introduction
This chapter includes an introduction of the study, statement of the problem, objectives of
the study, research methodology adopted for research which includes sampling population,
variables and how to measure them, measuring instrument, tools & techniques for data

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collection, contributions of the study, the scope of the study. This chapter also presents the
limitations of the study, and the disposition of the thesis.

Chapter 2: Research Methodology

This chapter details and justifies the use of research methodology adopted to explore the
research objectives contained in the thesis. As indicated above, the research methodology
involves an assessment of research questions featuring a cross sectional study. Information
on questionnaire design and formulation of research objectives & hypothesis is detailed in
this chapter. The steps for selecting respondents, collecting, recording, collating, analyzing
& presenting data is also indicated in this chapter.

Chapter 3: Literature Review

This chapter explores through a review of books & e-books, thesis & dissertation, Peer
Reviewed Journals (National & International) & Conference Proceedings studies, research
studies, Articles, Magazines & Newspapers conducted on online shopping & consumer
behavior. It also reviews the e-consumer behavior and factors affecting e-consumer
behavior. The theories, models and studies are explored and evaluated against the recent
study on online shopping. It throws light on the past research studies carried on online
shopping and e-consumer behavior.
The analysis literature review is also used to find out the existing area explored in the area
of online shopping & areas that are unexplored.

Chapter 4: Opportunities and Challenges to e-Retail

This chapter overviews the current scenario & statistics of e-Retail in India, growth &
opportunities to e-retail in India, the drivers of growth. The SWOT analysis of e-retail, PEST
analysis framework, Porter's five forces analysis of retail was done. It also addressed the
challenges to e-retail and Attractiveness of e-retail industry Business vs Consumer.

Chapter 5: Profile of e-Consumers and e-Retailers

This chapter explains the overview of e-consumers profile, age group wise e-consumer
segments in India, Key e-consumer trends shaping segment profiles in India. The E-
Consumer Comprehending, buying behavior of emerging e-consumer segments are

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presented. The overview of 8 electronics e-retailers are selected for this study is also
elaborated in this chapter.

Chapter 6: Statistical Analysis of Data

In this chapter an analyses data of survey questionnaires with the help of MS-Excel & SPSS
16. It also describes the finding of the study to understand e-consumer behavior. It utilized
various statistical tool & techniques used for testing the hypothesis of the study.

Chapter 7: Summary of Findings, Conclusions and Recommendations

It contains a summary of the report along with findings, Conclusions & recommendations
for next steps of the investigation. This chapter concludes the thesis by discussing the
contributions & limitations of research findings as well as future contributions could be
undertaken to further advance the contribution to the knowledge presented in the thesis.

1.14 Chapter Summary

This chapter has placed the theoretical, conceptual and research foundations for the thesis.
It focuses on the overall purpose and directions of this study. The rationale for studying e-
consumer behavior towards online purchases of electronic products in Maharashtra state as
well as factors affecting e-consumer behavior has been identified and discussed. Within
these themes a research problem and an associated research approaches have been
identified.

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