Professional Documents
Culture Documents
net/publication/335464740
CITATIONS READS
2 889
3 authors:
SEE PROFILE
Some of the authors of this publication are also working on these related projects:
Online Buying Behavior: Prospects for Online Sale Promotions Strategies in Pakistan View project
All content following this page was uploaded by Syed Sohaib Zubair on 29 August 2019.
Abstract
Online markets or arena is the focus of many organizations and entrepreneurs.
Various aspects and prospects of this growing industry have been researched.
However, this research was conducted to study the impact and role of various Online
Sale Promotions strategies on Online Buying Behavior with reference to the Pakistani
industry. Pakistan’s online market is expanding day-by-day increasing the internet
coverage and internet literacy, therefore, companies should be aware of the precise
strategies to be opted to attract potential customers. This study follows a quantitative
research strategy where the sample (299) has been collected through convenient
sampling strategy. The data has been collected using an instrument developed based
on the literature reviewed. Following the reliability analysis, descriptive statistics was
used to compare the behavior and preferences of the customers based on their
demographics. After the descriptive analysis, hypotheses developed in the light of
research objectives and literature, were tested using correlation analysis and multiple
regression analysis.
1. Introduction
International Telecommunication Union estimated that about 3.2 billion people
(almost half of the world’s population) have internet access, whereas approximate of
44.6 million users are from Pakistan. Annual Digital Growth revealed that Pakistan’s
internet users have increased by 21 percent (10 million users) over the past year. This
huge increase in number of internet users reflects the potential for companies or brands
involved in online business.
Several online shopping platforms or websites are successfully operating in
Pakistan trying to attract customers through various promotion techniques such as
variety of products, round the clock service, free shipment, lowest price claims,
replacement warranty, cash on delivery, and others.
This study intends to explore the impact of online sales promotions on the online
buying behavior as a prospect potential tool for growth in this industry. The sales
1
PhD Scholar, Anarka Yildirim University, Anarka, Turkey. mukarram_619@yahoo.com
2Instituteof Business Administration, University of Punjab, Lahore, Pakistan.
a.khan217@hotmail.com
3PhD Scholar, Institute of Administrative Sciences, University of Punjab, Lahore,
retailers and businesses may opt in order to influence buying behavior of online
customers. With an increasing online market in Pakistan, it is necessary to tap this niche
and develop business strategies in order to gain competitive advantage.
1.3 Significance
Internet users in Pakistan are increasing rapidly; hence, the market potential of
online markets is also growing. This study will help to provide empirical evidence
towards the prospects of sales promotion strategies with reference to online buying
behavior in Pakistani industry.
Ultimately, the aim of the seller is to enhance its sales and to earn profit, for which
they use different promotions and offers. Studies have shown that the online promotion
enhance the sales volume. This study emphasis on identifying the relation between
online sales promotion tools in lieu with online buying behavior. Internet and
telecommunication are the future, therefore the online shopping industry or the B2C E-
Commerce industry needs to stay vigilant in an era where things are rapidly changing
and the competitions is very high, and where the customers have a wide range of choice
to choose.
2. Literature Review
Internet based market is one of the best platforms for selling products or services.
According to Svensk (2014), internet users are growing at the rate of 17percent from
2013-2014. Sim and Koi (2002) pointed out that the usage rate and internet involvement
has direct impact on online buying behavior. In this value conscious world, people are
seeking for different types of sale promotions. Competitors of every field are trying to
attract customers by using different practices of sale promotions. Most of the studies
have suggested a positive relation between sale promotions and buying behavior.
Results from most of the studies conducted in US/EU may not have external validity
across all cultures due to many differences in information and communication
technology (ICT) as well as social and economic variances (Akman & Rehan, 2014).
Some of the researchers are of the view that online purchasing of promoted
products can be impulsive, where, website design, web expertise (Wu et al., 2016),
hedonic and functional motivations (Akram et al., 2017) or other situational elements
(Chung et al., 2017) can play an imperative role.
According to Obeid (2014), the basic motives behind sale promotions are to
enhance revenues, attract new customers, and balance of stock. Sale promotions are
not only effective in temporarily increasing sales but is also cost-effecive as compared
to other marketing gears like advertising (Cuizon, 2009). Xu and Huang (2014)
suggested that online shoppers are more price sensitive due to freely available least
search cost and straight price comparisons, as contrast to physical purchasing. The
price promotions (straight discounts) were used as independent variable to check the
food consumption (Martin, Bauld, & Angus , 2017), according to aforementioned
reseachers, price promotions have more worth in Europe and Scotland.
England (2016) identified that the increase in sales due to multi-buy products is
29percent - 35percent while that of temporary price reduction is 20percent -25percent.
Kotler and Armstrong (1997) found out that sale promotions encourage people to
purchase for short intervals of time. Though, some researchers argued that sale
promotions enhance the repetition of purchasing if the customer becomes satisfied with
the product that is being promoted, it is more likely that they will purchase the product
even when the promotion is over.
A similar study was conducted in Bahawalpur, Pakistan on 200 respondents and
used correlation and regression analysis to find out the strength of relationship between
price discounts and consumer buying behavior and results were quite positively
significant (Ashraf et al., 2014).
Moving onto the second dimension i.e. buy-one-get-one-free, Mughal et al. (2014)
studied buy-one-get-one-free as independent variable and tested its influence on
consumer buying behavior in Pakistan, the sample was of 200 which included
professionals, university students and other purchasers like housewives. buy-one-get-
one-free has a considerably positive relation with consumer buying behavior. A study
conducted in retail sector analyzed the relationship between buy one get one free and
consumer buying behavior with sample of 160 of two supermarkets of Guildford, United
Kingdom and results concluded that there was a positive significant relationship
between BOGOF and consumer buying behavior (Shamout, 2016).
Rizwan et al. (2013) argued that buy-one-get-one-free and price discounts have a
more significant effect than other promotional strategies on customer purchasing
behavior.
The results for online buyers might vary in comparison to offline customers,
because of the trust element that is involed between the BOGOF offer and the quality
of the product. In an another study, it was concluded that due to potentiality of frauds
and scams, Online Buyers tend be skeptical towards bonus or package deals (Yin &
Jin-Song, 2014).
England (2016) stated that multi-buy products have greater impact on sales volume
than temporary price reduction. Hawkes (2009) proposed that price promotions resulted
in an icrease in sales from 12percent to 60percent in short-term. In addition, 17percent
of augmented sales arose with planning while remaining 83percent purchased volume
was the outcome of promotion itself (England, 2016). This study was conducted in US
and Scotland.
Moving onto the next dimension of online sale promotions, Hui Tseng et al. (2001)
defined free gifts as “buy A, get a free gift B; that is, A and B were dissimilar products”.
Some investigators claimed that free gifts promoting practices have adverse
relationship with buying behavior, whereas others opposed this argument. The posing
of free gifts is not as much easy as it seems. According to Raghubir (2004), the
managers should be very active in offering free gifts, if the low valued brand’s product
is offered with costly product, the consumers are likely to pay for that product. On the
other hand, if the cheaper product is presented as a free gift, the consumers are less
willing to pay for the main product. However, it is practically difficult to follow this free
gift strategy alone in market for a longer period of time (Chirkov, 2003). Moreover, it is
also identified in the European market segment where free gifts can lead to the less
significant consumer buying behavior (Park & Yi, 2019).
As far as free delivery is concerned, in a study conducted with the help of 14 in-
depth interviews in Sweedish setting on online promotions and consumer buying
behavior, it was concluded that boredom plays an important role in purchasing online
and free delivery positively affects the online consumer behavior intent in such scenario
(Sundstrom et al., 2019). As the online purchasing is amassing, the shipping cost is
gaining importance. Koukova et al. (2012) stated that it is important but difficult to select
a shipping way to recover the delivery charges. According to previous research,
shipping fee is a significant obstacle for online shoppers to purchase the product
because they have to pay an additional or extra cost.
The review of documents by Kantar concluded that individuals purchase more
goods when the delivery is free. According to Rakesh et al. (2012), high priced products
seem more attractive with reduced price promotions but with low shipment costs but
looks unappealing if shipping price is extraordinary.
Moving on to the last dimension of online sale promotion strategies being discussed
in this study, E-coupons (titled as electronic coupon) are the innovative sale promotional
tools used in the market.
E-coupons are the digital analogue of the paper coupons used to attract customers
for buying by offering some varieties of discounts or gifts. E-coupons are mostly used
in service corporates like amusement parks, restaurants, and travel agencies (Kang,
Hahn et al., 2006). Mohan (2006) informed that e-coupons also contain description of
products, its value, restriction on its use and other fields. According to Zheng et al.
(2017), a study conducted on effectiveness of electronic coupons on 537 online users
following a longitudnal research design and revealed that the results were positive &
significant. However, the literature is very limited as far as this dimension is concerned,
particularly with reference to Pakistan. Hence, this study emphasizes to explore the
impact of e-coupons on online framework in Pakistan’s context.
In the context of the discussion above, following hypotheses have been developed
in the light of research objectives:
3. Theoretical Framework
4. Methodology
This study is conducted to find out the views, attitude, perception and behavior of
Pakistani people about sales promotions (BOGOF, price promotion, free shipment, gifts
and e-coupon) in online context. The quantitative research approach is followed to test
the hypotheses. Cross-sectional research design is followed in order to carry out this
study. Primary data is collected through structured questionnaire, which was developed
for collecting measuring the variables under consideration.
The questionnaire has two components, the first part consists of demographic
information which are important for study, this includes, age, gender, education, income
etc. The second part consists of 25 items, which are measured using a five point Likert
scale. Reliability is calculated with the help of Cronbach’s alpha and threshold of 0.60
is followed.
Due to homogeneity of the population, the non-probability convenient sampling
technique is used in this study. The sample size of 350 was initially planned by using
Krejcie and Morgan table (Sekaran, 2003). The valid response of total sample is 299
with response rate of 85.4percent. SPSS version 23 software is used to analyze the
collected information by applying various statistical tools. The unit of analysis for this
study is ‘individual’.
Table 1: Buy-One-Get-One-Free
Education Gender Mean
Matric Male 2.2000
Female 2.4667
Total 2.4000
Intermediate Male 2.4821
Female 2.5800
Total 2.5246
Graduate Male 2.4899
Female 2.3754
Total 2.4416
Post Graduate Male 2.4682
Female 2.3833
Total 2.4382
Total Male 2.4809
Female 2.4295
Total 2.4597
Source: Author Compilation
Total 2.8179
No Male 2.8804
Female 2.6019
Total 2.7774
Total Male 2.8555
Female 2.7397
Total 2.8078
Source: Author Compilation
With reference to table 6, measures for the variables and their dimensions
included in this study were put to reliability test using Cronbach’s alpha, the value for
which was found reliable for each of the variable i.e. greater than 0.60. According to
Nunnally (1978), Cronbach alpha of 0.5 - 0.6 is considered as sufficient, whereas value
greater than 0.6 is considered appropriate.
In table 9 the free home delivery offer has positive but weak impact on online buying
behavior. The statistical values that are calculated by Pearson Correlation is r = 0.257
and P-value = 0.000.
Table 10: Online Direct Discounts Offer and Online Buying Behavior
Online Direct Online Buying
Discounts Behavior
Online Direct Discounts Pearson Correlation 1 .457**
Sig. (1-tailed) .000
N 297 297
Online Buying Behavior Pearson Correlation .457** 1
Sig. (1-tailed) .000
N 297 299
Source: Author Compilation
In case of online direct discounts, as shown in table 10, it has moderate relation
with online buying behavior. The P-value is 0.000 and R-value is 0.457 under the
significance level of 0.01 > 0.000 = P-value. It means H0 is rejected in this case.
As per table 11, P-value is less than significance level, i.e. 0.009 < 0.01; it means
H0 for this relation is rejected. The R-value is 0.138, which shows that e-coupon has a
very weak impact on online buying behavior but has positive relation between them.
The above equation shows that online directs discount and online free gifts are the
best possible predictors of online buying behavior.
6. Conclusion
This study is conducted to analyze the buying behavior of online Pakistani’s under
the light of five sale promotions that are offered in the online domain. These promotions
includes Buy-one-get-one-free, free gifts, free home delivery, discounts and e-coupon.
Under the sample of 299, 175 respondents were male and 124 were female. Out of this
sample, 223 people have done online purchase while the remaining has never
experienced it yet. Descriptive analysis shows that only 46 (15percent) have the usage
duration of internet less than 3 hours, 128 (43percent) are those who have 3-6 hours
usage duration and 124 (42percent) are from above 6 hours users out of 300 people.
After online buyers, the first target market of online sellers is internet users that are
growing rapidly. This shows that the future of online businesses is bright because of
vast market availability.
Talking about income, low income is the barrier in the online purchasing. Analysis
of income shows that about 50percent are those having income less than 20,000 PKR.
The barrier of low-income audience can be solved by online sale promotions because
limited income makes people more price or value conscious.
The regression equation also illustrates that customers are more responsive
towards discounts i.e. they want lesser prices instead of more valued as buy-one-get-
one-free and other variables.
From all above discussed variables, online direct discounts and online free gifts
offers have significant relation with buying behavior in online context. The online market
of Pakistan has lesser income, that is why they belongs to price conscious and are good
respondents of discounts offers instead of buy-one-get-one-free offer or e-coupon.
E-coupon is a new term for most of the people in Pakistan. As per the data analyzed
in this study, the statistically important sale promotion that shall be used to attract
customer in online context is direct price discounts and free gifts offers.
7. Managerial Implications
The managers of online selling companies suggested that they should use direct
price discounts and free gifts offer in online context. They can expand their market share
and increase sales volume by attracting customers through such discounts and gifts
offer. Buy-one-get-one-free, free home delivery and e-coupons are less responsive
techniques, nonetheless significant.
References
Akman, I., & Rehan, M. (2014). Online purchase behaviour among professionals: a
socio - demographic perspective for Turkey. Economic research-Ekonomska
istraživanja, 27(1), 689-699.
Akram, U., Hui, P., Khan, M.K., Saduzai, S.K., Akram, Z. & Bhati, M.H. (2017). The
plight of humanity: online impulse shopping in China”, Human Systems
Management, 36 (1), 73-90.
Armstrong, K. A. (1997). Marketing An Introduction. Prentice Hall International.
Ashraf, M. G., Rizwan, M., Iqbal, A., & Khan, M. A (2014). The promotional tools and
situational factors’ impact on consumer buying behavior and sales promotion,
Journal of Public Administration and Governance, 4 (2), 179-201
Blundo, C., Cimato, S., & DeBonis, A. (2005). Secure E-Coupons,. Netherland; Springer
Jakobsson, M.; MacKenzie, P.D.; and Stern J.P. (1999). Secure and lightweight
advertising on the Web. In 9th World Wide Web Conference Science and
Business Media, Inc
Chirkov, V. R. (2003). Differentiating autonomy from individualism and Independence:
self-determination theory perspective on internalization of cultural orientations
and well-being. Journal of Personality and Social Psychology, 84 (1), 97–110.
Chung, N., Chung, N., Song, H.G., Song, H.G., Lee, H. & Lee, H. (2017). Consumers’
impulsive buying behavior of restaurant products in social commerce.
International Journal of Contemporary Hospitality Management, 29 (2), 709-
731.
Cuizon, G. (2009). The measurable effects of sales promotions in strategic business
planning. Retrieved June, 27, 2015.
Daramola, G. O. (2014 ). Sales promotion on consumer purchasing behaviour.
International Journal of Business and Marketing Management , 2(1), 8-13.
England, P. H. (2016). An analysis of the role of price promotions on the household
purchases of. England. London: PHE
Gilbert, D. (1999). Retail Marketing Management. Prentice Hall.
Hawkes, C. (2009). Sales promotions and food consumption. Nutrition Reviews, 67 (6),
333–342.
Javadi, M. H. M., Dolatabadi, H. R., Nourbakhsh, M., Poursaeedi, A., & Asadollahi, A.
R. (2012). An analysis of factors affecting on online shopping behavior of
consumers. International Journal of Marketing Studies, 4(5), 81-98.
Kang, H., Hahn, M., Fortin, D. R., Hyun, Y. J., & Eom, Y. (2006). Effects of perceived
behavioral control on the consumer usage intention of e‐coupons. Psychology
& Marketing, 23(10), 841-864.
Koukova, N., Srivastava, J., & Steul-Fischer, M. (2012). The effect of shipping fee
structure on consumers’ online evaluations and choice. Journal of the Academy
of Marketing Science, 40 (6), 759–770.
Kumar, M., Rangachari, A., Jhingran, A., & Mohan, R. (1998, August). Sales promotions
on the Internet. In 3rd USENIX Workshop on Electronic
Commerce (pp. 167-176).
Malik, G., & Sachdeva, H. (2015). Impact of sales promotion technique used by online
dealers on consumers. International Journal of Applied Sciences and
Management, 1(1), 63-78.
Martin, L., Bauld, P., & Angus , K. ( 2017). The impact of promotions on high fat, sugar
and salt (HFSS) food and drink on consumer purchasing and consumption
behaviour. NHS Health Scotland.
Mobile Marketing Association (MMA). 2007. Introduction to mobile coupons, available
at www.mmaglobal.com
Mughal, A., Mehmood, A., Mohiuddeen, A., & Ahmad, B. (2014). The impact of
promotional tools on consumer buying behavior: A study from Pakistan. Journal
of Public Administration and Governance, 4(3), 402-414.
Nunnally, J. C. (1978). Psychometric theory (2nd edit.) mcgraw-hill. Hillsdale, NJ.
Obeid, M. Y. ( 2014 ). The effect of sales promotion tools on behavioral responses.
International Journal of Business and Management Invention, 3(4), 28-31.
Palumbo, F., & Herbig, P. (1998). International marketing tool: The Internet. Industrial
Management & Data Systems, 98(6), 253-261.
Park, Y., & Yi, Y. (2019). When free gifts hurt the promoted product: The influence of
product -gift fit on activating persuasion knowledge and devaluating the
promoted product. European Journal of Marketing.
Peattie, K., & Peattie, S. (2009). Social marketing: A pathway to consumption
reduction?. Journal of Business Research, 62(2), 260-268.
Raghubir, P. (2004). Free gift with purchase: promoting or discounting the brand?
Journal of Consumer Psychology, 14 (1-2), 181-186.
Rakesh , S., & Khare, A. (2012). Impact of promotions and value consciousness in
online shopping behaviour in India. Journal of Database Marketing & Customer
Strategy Management , 19 (4), 311-320.
Rizwan, M., Javed, M. A., Khan, M. T., Aslam, M. T., Anwar, K., Noor, S., & Kanwal, W.
(2013). The impact of promotional tools on consumer buying behavior: A study
from Pakistan. Asian Journal of Empirical Research, 3(2), 114-130.
Sekaran, U. (2003). Research methods for business. Cabondale: United States of
America.
Shamout, M. D. (2016). The impact of promotional tools on consumer buying behavior
in retail market. International Journal of Business and Social Science, 7(1),
75-85.
Sim, L. L., & Koi, S. M. (2002). Singapore's Internet shoppers and their impact on
traditional shopping patterns. Journal of Retailing and Consumer
Services, 9(2), 115-124.
Sundström, M., Hjelm-Lidholm, S., & Radon, A. (2019). Clicking the boredom away–
Exploring impulse fashion buying behavior online. Journal of Retailing and
Consumer Services, 47, 150-156.
Svensk. (2014). Rapport Digital Mathandel. . [online] Göteborg.
Thomas, P., & Chrystal, A. (2013). Explaining the “Buy One Get One Free” Promotion:
The golden ratio as a marketing tool. American Journal of Industrial and
Business Management. 3(8), 655-673.
Tseng, C. H., Lou, Y. C., & Bei, L. T. (2009). A research of the effect of gift promotion
and its spillover effect. Advances in Consumer Research, 36, 946-950.
Wu, L., Chen, K. W. & Chiu, M. L. (2016). Defining key drivers of online impulse
purchasing: a perspective of both impulse shoppers and system users.
International Journal of Information Management, 36(3), 284-296.
Xu, Y., & Huang, J. S. (2014). Effects of price discounts and bonus packs on online
impulse buying. Social Behavior and Personality: an international
journal, 42(8), 1293-1302.
Zheng, X., Lee, M., & Cheung, C. M. (2017). Examining e-loyalty towards online
shopping platforms: The role of coupon proneness and value
consciousness. Internet Research, 27(3), 709-726.