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An Study of Customer Perception of E-tailing: Case of Delhi/NCR

Presented By: Satyabrata Sahu MBA Class of 2012 A0101910215 Roll No. - D55

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Agenda

Introduction Theoretical framework Literature Review Hypothesis Research Methods Results Discussion Limitations
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Purpose
How Indian customers perceive e-tailing or electronic retailing and how this affects their intention of purchase within the Internet shopping environment.

Research Objectives
1. Establishing the relationship between perceptual dimensions and preference for e-tailing. 2. Establishing the relationship between demographic dimensions and preference for e-tailing.
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Introduction
Role Of Internet in Ecommerce. Indian Retail Market. 5th largest in the world. E-retailing 6.48% of the total e-commerce market in India. (E-commerce India 2011 report, Research on India) Influence on E-commerce.

(Source: Edelweiss research)

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Introduction
Characteristics of Indian Retail Market. Touch & Feel. Cost/Benefit oriented. Gen Z (or Net generation) Surging Investment in e-commerce.

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Theoretical Framework
Theory of Reasoned Action (TRA): Immediate antecedent of a behavior is the intention to perform the behavior in question
Determinant of Intention: Perceptual Factors: Trust, Confidence, Experience, Social Experience. Personal Factors: Income, Age, Occupation.
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Theory of Reasoned Action

TRUST
INCOME

CONFIDENCE

INTENTION TO SHOP ONLINE

AGE

EXPERIENCE

SOCIAL INFLUENCE

OCCUPATION

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Literature Review
Author(s) Parikh, Darshan (2006) Li, Na & Zhang, Ping (2002) Delafrooz, Narges et.al. (2010) Findings Age, Gender & Income are accurate indicators of who shop online. Personal characteristics, Product characteristics & website features affect online shopping. Utilitarian orientation, convenience, price and wider selection of products are significant determinants of online shopping attitudes. Online shopping perceived as more risky than conventional shopping. Positive online shopping experience leads to less perceived purchasing risk. Convenience, accessibility, scope, attraction, reliability, experience and clarity are the important factors considered by the online shoppers Brand, confidence in transactions and after sales service affect online purchase.
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Noort, Guda Van et. al. (2007) Samadi, Mansour et. al. (2009) Rishi, Bikram Jit (2008)

Sun Lu (2009)

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Hypotheses
Hypothesis 1 (H1): Customers intention to shop online is positively influenced by perceptual factors: H1a: Perceived trust H1b: Perceived confidence H1c: Perceived experience H1d: Perceived social influence
Hypothesis 2 (H2): Customers intention to shop online is positively influenced by personal factors income & occupation. Hypothesis 3 (H3): Customers age negatively influences the intention to shop online.

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Research Methodology
Research Design: Descriptive research Sampling: Convenience sampling Sample Size: 196 respondents (calculated by using Cochrans Formula); 177 responses collected back (Response rate= 90.3%) Data Collection: Secondary sources (previous research works) & Primary sources (survey) Primary data collection instrument: Online Questionnaire Data Analysis: Descriptive Statistics Multiple Regression
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Results

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Results

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Results

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Results

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Results

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Results

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Results
ANOVAb Model 1 Regression Sum of Squares 21.881 Df Mean Square 7 3.126 F 4.511 Sig. .000a

Residual
Total

117.113
138.994

169
176

.693

a. Predictors: (Constant), I often come across of ads of internet stores, Internet stores price products reasonably, Internet stores provide personalized products, Internet stores truly understand latest trends, Internet stores provide timely delivery of orders, Internet stores provide good value & service, Internet stores sell known brands b. Dependent Variable: Do you intend to purchase from internet stores in future?

Intention to shop online regressed with perceived Trust P < 0.05 Null Hypothesis rejected, Alternate Hypothesis (H1a) accepted. There is positive influence of perceived trust on the customer intention to shop online.
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Results
ANOVAb Model 1 Regression Residual Total Sum of Squares 11.906 125.043 136.949 df Mean Square 4 2.976 170 174 .736 F 4.047 Sig. .004a

a. Predictors: (Constant), Transactions made over internet stores are secure, I am comfortable with shopping over internet, Internet stores have good reputation, Internet shopping is hassle-free b. Dependent Variable: Do you intend to purchase from internet stores in future?

Intention to shop online regressed with perceived Confidence p < 0.05 Null Hypothesis rejected, Alternate Hypothesis (H1b) accepted. There is positive influence of perceived confidence on the customer intention to shop online.

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Results
ANOVAb Model 1 Regression Residual Total Sum of Squares 28.431 110.563 138.994 df Mean Square 3 9.477 173 176 .639 F 14.829 Sig. .000a

a. Predictors: (Constant), Internet stores elevate the traditional shopping experience, Internet stores provide replacement options, Internet shopping is value for money b. Dependent Variable: Do you intend to purchase from internet stores in future?

Intention to shop online regressed with perceived Experience. P < 0.05 Null Hypothesis rejected, Alternate Hypothesis (H1c) accepted. There is positive influence of perceived experience on the customer intention to shop online.
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Results
ANOVAb Sum of df Mean Square F Squares 1 Regression 1.987 1 1.987 2.538 Residual 137.007 175 .783 Total 138.994 176 a. Predictors: (Constant), I will rely on review/advice before shopping over internet b. Dependent Variable: Do you intend to purchase from internet stores in future? Model Sig. .113a

Intention to shop online regressed with perceived Social Influence. P > 0.05 Fail to reject Null Hypothesis, Alternate Hypothesis (H1d) rejected. There is no influence of perceived social influence on the customer intention to shop online.

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Results
ANOVAb Sum of df Mean Square F Squares 1 Regression 11.790 2 5.895 8.064 Residual 127.204 174 .731 Total 138.994 176 a. Predictors: (Constant), Occupation ?, Annual Household Income ? b. Dependent Variable: Do you intend to purchase from internet stores in future? Model Sig. .000a

Intention to shop online regressed with personal factors. P < 0.05 Null Hypothesis rejected, Alternate Hypothesis (H2) accepted. There is positive influence of personal factors on the customer intention to shop online.

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Results
ANOVAb Model Sum of Mean df F Sig. Squares Square 1 Regression 3.213 1 3.213 4.141 .043a Residual 135.782 175 .776 Total 138.994 176 a. Predictors: (Constant), Age ? b. Dependent Variable: Do you intend to purchase from internet stores in future?

Intention to shop online regressed with Age. P < 0.05 Null Hypothesis rejected, Alternate Hypothesis (H3) accepted. There is negative influence of age on the customer intention to shop online.

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Results

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Discussion
Perceived trust +ve influence on intention to shop online. This means that customers are involved in online retailing when they are aware of the brand of the retailer and the products it is selling. Also a positive trust factor is deciphered as good value and service. Perceived confidence +ve influence on intention to shop online. So it can be reported that customers are more comfortable if they are aware of the fact that their transactions are secure and they can share their private information fearlessly, and thus reduces the risk of the transaction. Perceived experience +ve influence on the intention to shop online; so it can be reported that customers would go for shopping online if the traditional shopping experience is enhanced or elevated by providing an innovative or more creative atmosphere online through better design and functionalities. Perceived social influence -ve influence over the intention to shop online; as a positive word of mouth/review can persuade a customer to shop, so does a negative word of mouth/review could send a repelling message thereby making the online shopping activity unattractive.
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Discussion
Income and occupation +ve influence over the intention to shop online. This can be due to the fact that higher disposable income makes customers better risk takers and adopters of new technology. Thus higher income means more attraction to go for shopping online. Similarly, occupation makes people more aware of trends and thus affects the urge for trial and thus the intention to shop online. Customers age -ve influence on the shopping intention and it can be reported that with increasing age there is a fall in the intention to shop online. This can be due to difference in thought process and societal influence. Even though e-retailers are making their display of products more prominent day by day by exposing the customers with advertisements, still there is a notion that traditional physical retailing is more appealing than online retailing.
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Recommendations
Issue Better interaction with customers. What to Do? Innovative website design interface How to Do? 3-D interface simulating the actual product. Outcome Enhance the feel of the product increase trust & confidence, experience. Keep the customer occupied instill trust confidence.

Waiting period Personalized anxiety / interactive Replacement response scale queries Customer involvement, feedback and retention One-to-one customer service

Scale that depicts the processing timeline and status of customers query/issue. Providing personal customer service operator to every customer for query handling & feedback.

Empathetic customers and enhanced loyalty.

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Limitations
The study was limited to Delhi/NCR and the respondents available over internet (Facebook and other social networks) were of prime concern. The study provides only generalizations. The biasness in responses cannot be ruled out. Also the numbers of females were less as per the recorded data so the generalization that males are dominating in e-tailing activities cannot be taken as the hard truth.
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