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Research-240419-01 The - Potential - of - Mobile - Technology - Appli
Research-240419-01 The - Potential - of - Mobile - Technology - Appli
ABSTRACT 1 INTRODUCTION
Due to the increasing income and purchasing power The retail industry is experiencing
of the Malaysian consumers, as well as the significant expansion as the “society has grown
proliferation and wide expansion of hypermarkets in more affluent in recent years and with greater
Malaysia, the hypermarkets are in an intense purchasing power” [1]. Due to the increase in
competition for survival and sustainability. the Malaysian “income and purchasing power”,
However, with the high mobile penetration rate of the retail sector is experiencing tremendous
Malaysia, the author foresees the potential to growth with the expansion and proliferation of
leverage mobile technology to help retail businesses hypermarkets in Malaysia [2]. The competition
gain competitive advantage by improving service among hypermarkets in the region is escalating,
satisfaction. Malaysian consumers (N=69), with also considering the fact that the number of
focus on students, professionals, and housewives, hypermarkets in Malaysia has been
have been surveyed and interviewed to better proliferating since the 1980s, players in the
understand the Malaysian consumer market, grocery
Malaysian hypermarket industry have to strive
shopping behavior, as well as the acceptance and
to maintain competitive advantage to keep up to
preference of mobile technology relevant to the
grocery shopping practice. Results of this pioneer
the game of the retail sector.
research indicate the feasibility of the mobile Nevertheless, Since the advent of mobile
application implementation whereby its findings technology, mobile devices, ranging from
imply strong acceptance (69%) of mobile laptops to tablets to mobile phones, have
technology into grocery shopping routine. largely penetrated and influenced the modern
Additionally, Shopper Engagement Study daily lives of many. The rate of mobile
conducted by POPAI and business analysis using penetration in the global market is on the rise
SWOT have been adopted as secondary research in from one year to another, reportedly to reach
supporting primary data collected. Based on the 6.9 billion mobile subscribers by the end of
primary and secondary data gathered, the outcomes 2013 as estimated by Mobile Factbook 2012
of this research support the recommendation of [3].
mobile system with features preferred by the
Malaysian consumers, namely Product Browsing, Joe Colopy, the CEO of Bronto Software
Product Comparison, Promotion/Discount discussed through an interview conducted by
Personalization, and Shopping List. Hauss, specifically stating that “the retail
industry is experiencing a momentous shift in
KEYWORDS consumer behavior, fueled by the ubiquity of
smartphones”, signifying the gradual increase
Hypermarket; mobile application; Malaysian of influence of the mobile technology in the
consumer; Shopper Engagement Study; consumer retail industry [4].
behavior; grocery shopping; technology acceptance
Therefore, the author recommends adopting
user-centric design approach where the author
suggests shopping practices to be translated into
features to incorporate into a mobile system, the findings gained from the research methods
which will cater to the characteristics of the performed are discussed. The recommendation
four (4) general types of consumer behavior, of suitable system features for the mobile app in
determined through the Shopper Engagement hypermarket industry are presented in section 5
Study conducted by POPAI [5]. Nonetheless, and finally, conclusion is prepared in section 6.
the suggestions will be amended throughout the
course of this research to ensure the
compatibility to the Malaysian market. 2 PROBLEM STATEMENTS
Consequently, this research outlines the The growth of the average number of
feasible features in mobile technology hypermarkets in Malaysia is tremendously
application implementation for the hypermarket significant that it is, reportedly, to have
industry preferred by the Malaysian consumers, increased from 2.1% to 26.8% from 2003 to
in which the recommendations are based on the 2008, whereby in 2009 and 2010, there were a
primary data (questionnaire and interview) and total of one hundred seven (107) granted
secondary data from the Shopper Engagement licenses and seventy-eight (78) were
Study conducted by POPAI [5]. As the operational. This indirectly contributed to the
implementation of information systems in the intense competition that causes difficulties for
hypermarket industry would impact not only hypermarkets to compete for survival and to
one but many related companies through maintain competitive advantage in the retail
increasing competitive advantage, business sector of Malaysia [6][7].
analysis using SWOT is performed to support
the feasibility of system features to be Furthermore, the level of customer
recommended in the mobile technology satisfaction with the major hypermarkets in
application. The recommendations are expected Malaysia namely AEON Big (formerly known
to bring a new level of grocery shopping as Carrefour), Tesco, and AEON (formerly
experience to the Malaysian market, to equip known as Jusco) is within the range of 48% to
the hypermarket industry with the requisite 75%, indicating only average satisfaction level
capabilities, to reinforce the industry network of consumers in the major hypermarkets of
and also the commitment to effectively deal Malaysia [8]. The adoption rate of technology
with competitors. into existing hypermarkets in the country is
comparatively lower than that of the western
This research paper is organized as follows; countries where the implementation and
section 2, the current problems are discussed in application of technology into the grocery
relation to the growth of hypermarket industry shopping experience have gained wide
in Malaysia and satisfaction level of consumers consumer acceptance. Reportedly, Malaysia has
in major hypermarkets in Malaysia. Section 3 yet to be introduced with the concept of
serves the rationale of undertaking this technology adoption into the hypermarket
research. The Shoppers Engagement Study that retailing industry and the Malaysian market is
has been chosen as the basis in analyzing the yet to be familiarized and accustomed with
four (4) general types of consumer behavior is such a concept [9].
explained. The relevance on why the Shoppers Since studies had shown average satisfaction
Engagement Study is feasible to derive the level of consumers in the major hypermarkets
recommended features for mobile technology of Malaysia, and the concept of technology
application (mobile app) in hypermarket adoption is yet to be familiarized by the
industry is also briefly explained in this section. Malaysian hypermarket retailing industry, the
Then, section 4 comprises the methods used to recommendation for feasible features in mobile
gather primary and secondary data in application system to meet consumer
recommending suitable features. In section 5,
Table 1 is used to analyze the priorities of Planner where smart grocery planning is in
the consumer behaviors against several usual practice.
characteristics or criteria relevant to grocery
Product Browsing & Searching
shopping practice.
Allowing shoppers to browse store products
To satisfy the needs, wants and demands of
with the proposed mobile application can help
different consumer behaviors identified, six (6)
to meet the needs and satisfy the demands of
shopping practices to be incorporated into the
the Bargain Hunter and the Explorer. In store
proposed mobile app are derived as below.
products will be displayed in the form of a web
Shopping List for Planned & Organized catalogue that virtually represents the physical
Shopping Trip or distributed catalogue. In addition, this feature
Shopping list helps Trip Planner and Time will also be beneficial to the Time Stressed and
Stressed shoppers in planning and organizing Trip Planner shoppers as it reduces the time and
shopping trips that are bound to time pressure effort needed to look for the intended
products/items to add on to the grocery list with
and the need to control and organize. As the
mobile app will act as a mobile tool to automate the use of the search function and different
filters.
and simplify the process of writing the grocery
list, it is environmental-friendly, convenient, Product Comparison
and time-saving since the shoppers no longer
Bargain Hunters are able to compare
need to use papers for such a purpose. Also, the
products by firstly searching for products with
process of adding up the grocery shopping costs
keywords and then apply filters, for instances,
and listing the products/items will no longer
lowest price, highest price, popularity, and such
require manual efforts.
to do a side-by-side comparison of products
In addition, according to a consumer displayed in the form of a catalogue.
research paper, impulsive buying is essentially
described as “unplanned purchase behavior”. Promotion/Discount Personalization
From this standpoint, the author reasons that a This feature addresses bargain hunting as
shopping list could help to curb impulsive shoppers will be allowed to personalize the
shopping behavior as “an impulse purchase promotions and discounts available to personal
could be construed as any purchase not written preference, saving them from the efforts to
on someone’s shopping list” [16]. This would trim, store, carry, and use printed coupons only
facilitate to instill healthy shopping practice usable during grocery shopping trips. This also
while specifically addressing the impulsive helps the hypermarkets to strengthen retail
buying issue that shoppers with Time Stressed, loyalty as business is able to track and study
Bargain Hunter, and Explorer consumer consumer preferences, as well as to encourage
behaviors may experience. less paper usage that is cost-effective to
business.
Budget Shopping Trip
In relation to the point discussed above, a Circular/Coupon Viewing
budgeting system will complement the Shoppers will be able to view promotions,
shopping list function of the mobile app by first discounts, or vouchers that will be virtually
allowing shoppers to input a budget. The represented, which will be useful for shoppers
mobile app will the alert the shoppers when the with consumer behaviors diagnosed with high
total cost of products/items on the shopping list circular/coupon usage such as the Bargain
has exceeded the inserted budget. This is effort- Hunter and Explorer. This will replace the
and time-saving and would benefit the shoppers traditional circulars, for instance, pamphlets
especially the Time Stressed and the Trip and flyers that will help business to save costs
while adding value to the shopping experience For the assurance of data integrity and
of the shoppers. accuracy, the author uses control question in the
questionnaire where only questionnaire
4.2 Online Questionnaire Survey
responses from participants whose age are at
least eighteen (18) are valid. The sample size of
Questionnaire is a primary data gathering the research is sixty (60) respondents. The
technique where a standardized set of domain- questions in the questionnaire can be
related questions is designed to capture categorized into three (3) different objectives
meaningful and useful quantitative data set for that are:
analysis. Questionnaire is then distributed to
intended respondents through various medium, To categorize respondents based on three
for instances, snail mail, email, distributed, and (3) consumer groups that are student,
such. Online questionnaire has been selected as professional, and housewife.
one of the data gathering techniques for the
To categorize respondents based on
purpose of this research due to its capability to
different aspects of grocery shopping
outreach to wide audience via the Internet
such as frequency, durations, budget,
within comparatively shorter period of time
plan, promotions, products, and
with lower costs. Since this research paper is
satisfaction.
not funded, using the online questionnaire
method for data collection is fairly suitable for To identify the features that respondents
sampling purpose for further analysis. mostly preferred to have in mobile
The online questionnaire is created and application for shopping experience in
hypermarket industry.
designed using Google Docs and a link is
generated and distributed to selected
participants online via social media networks 4.3 Interview
and email addresses. Gathered data is then
summarized into charts and diagrams for The semi-structured interview technique is
analysis, transferred into spreadsheet for selected so that the author could personally
advanced analysis using Google Analytics address to the participants to collect rich and in-
application. depth qualitative data, in order to gain insights
That said, data can be easily tabulated and on how three (3) consumer groups of student,
analyzed due to uniformity in which the professional, and housewife differently behave
participants respond to the same set of and react to various aspects of grocery
questions. Having said that, questionnaires are shopping. Semi-structured interview is
directly submitted to the author as participants specifically chosen since the area of research
complete the questionnaires, hence increasing has been already identified and that it allows
the efficiency of the data collection process as more in-depth discovery of data where details
time needed to collect data of a certain sample and personal revelations are paramount.
size is fairly reduced compared to other The participants of the interview sessions
methods in that aspect. Also, the online would be equally made up of the three (3)
questionnaire is self-administered therefore consumer groups as above mentioned where
increasing the response rate and the accuracy of three (3) participants from each group have
response since human error can be been personally selected hence a total of nine
circumvented while biasness towards subjective (9) participants are participating the interview
questions can be minimized as the online sessions. The particulars and responses of the
questionnaire can be answered anonymously participants are recorded as participants are
[17]. providing answers to the questions the author is
proposing during the interview.
Strength Weakness results and analysis are used to help the author
to approve, disprove, or amend the decision the
author developed as stated in section IV (A).
Respondent’s satisfaction level of traditional
External
Opportunity Threat
grocery shopping, preference of mobile
technology usage for grocery shopping, and
Figure 2. SWOT Analysis Matrix. preferred item/product categories to be
available in the mobile application are
Internal and external origins are covered in a identified through quantitative questionnaire
SWOT analysis where the internal factors are survey while qualitative interview sessions with
the strength and weakness; the external factors three (3) consumer groups of student,
are opportunity and threat, presented in the professional, and housewife are conducted to
form of a matrix (Figure. 2). gather in-depth information about different
groups of consumer and respective consumer
As one of the goals is to enhance the behaviors.
competitive advantage hypermarket with
technology, a SWOT analysis is developed The quantitative results focusing on six (6)
based on the characteristics of mobile areas which have been discussed in section IV
application for hypermarket industry to study (A) are as below:
how such proposal would benefit the business Shopping List for Planned & Organized
with competitive edges and possibly hurt the Shopping Trip: The quantitative results
business. The opportunities of the proposal will show only 60% of the respondents
be established mainly based on the assumed usually plan grocery shopping trip using
weaknesses and then possible threats are a shopping/grocery list whereas 40% of
identified.
them respond negatively. It is inferred
Strength – the proposal characteristics that most of the respondents would
that would provide competitive prefer the usage of a shopping list for
advantage to the business over the grocery shopping and such function to be
competitors. considered for the proposed system.
Weakness – the proposal characteristics Budget Shopping Trip: 70% of the
that would possibly hurt or harm the respondents do not budget grocery
competitive position of the business. shopping trips while 30% of the
4.1, Circular/Coupon Viewing is the least Table 2 depicts four (4) proposed features of
favored with merely 2% of the respondents mobile application system in hypermarket
have selected. The other five (5) mobile app industry, translated from the six (6) shopping
features, arranged with the most favored first practices using primary research data, and how
and least last, are: Product Comparison (42%), each proposed feature addresses the grocery
Promotion/Discount Personalization (23%), shopping criteria similar to that of Table 1.
Product Browsing (17%), Budgeting System
(10%), and lastly Shopping List (7%). Below Table 2. Proposed Features and Grocery Shopping
Criteria.
shows the changes to the recommended six (6)
Circular /
duration of grocery shopping trip Coupon
especially when most of the consumers Usage
Written List
(62%) spend only a maximum of one (1) Usage
hour for grocery shopping according to
the research data. To tackle this issue, the Next, the primary data collected also shows
author suggests to incorporate Shopping that 68% of the respondents are students, 18%
List feature with Budgeting System that are working professionals, and 5% are
would cost the consumers least effort to housewives. The author then discovers through
develop a shopping list and with extra data collected via interview that housewives do
flexibility and convenience built in. This not often visit to hypermarkets as compared to
feature will in turn facilitate to educate students and professionals for grocery shopping
the Malaysian consumers of good because housewives generally do daily grocery
shopping practice that can curb impulse shopping at the wet markets, mom-and-pop
purchases. stores, minimarts, and convenient stores, which
are more accessible than hypermarkets
Circular/Coupon Viewing: Such feature especially the small format stores such as
is to be absorbed by Promotion/Discount minimarts. Minimart is the fastest growing
Personalization feature through trade channel in terms of new outlets and offer
equipping it with personalization good-value-for-money products with very
capability to allow consumers selectively competitive pricing. “Coupled with the
view only preferred information, and convenience factor and simple store layouts”,
address what is perceived as information minimart is an emerging channel that is going
overloading because many items are to become a strong force to content with in
clustered into few pieces of papers, Malaysia [19].
which result in low conventional circular This has fortified the need for the
usage. hypermarket industry to bring in technology
of the suggested system features to be
Impulse Buying (Student: H; Housewife: implemented in mobile application technology
H) of the Malaysian hypermarket industry, here the
results of SWOT analysis of the proposed (Time Stressed) mostly still prefer the old ways
solution can be viewed in Table 4. of grocery shopping, they find such concept to
be helpful. They are bound to budget constraint
Table 4. SWOT Analysis for Proposed Solution. and are the strongest bargain hunters amongst
all categories. Cost effectiveness would be of
Pioneer technology integration in Malaysian hypermarket industry.
the main concern.
Encourage Go Green campaign and paperless environment to fulfill
Corporate Social Responsibilities (CSR), which helps to build In addition, the author also believes that the
reputation and company image.
proposed mobile application system should take
Strength
Encourage research and development and a new alternative of into consideration that most of the primary
Customer Relationship Management (CRM) to the industry.
research respondents (63%) are students
Better comprehension of buying behaviors and patterns of customers.
(Explorer) and female, therefore incorporate
Encourage good grocery shopping practices such as planning elements that are relevant to their
shopping trips and budgeting.
characteristics.
Unable to deal with customer complaints.
Lack of accuracy on the analysis of consumer buying behaviors and
All in all, the complete data gathered from
the primary and secondary research shows that
Weakness
and believe that technology could help to
Unable to deal with customer complaints.
facilitate, ease, and enhance the conventional
Lack of accuracy on the analysis of consumer buying behaviors and grocery shopping experience.
patterns as system merely Enhance, refine and upgrade system
Opportunity
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