“CONSUMER BEHAVIOR on online shoping

RESEARCH PROJECT REPORT ON “CONSUMER BEHAVIOR IN ONLINE SHOPPING ” “A report submitted to Gautam Buddh Technical University for the Partial fulfillment of MBA Degree 2009-11”

Submitted BY: Saurabh Gupta MBA - IVTh SEM 0922270043

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A RESEARCH REPORT ON

“Consumer

Behavior In Online Shopping”

Submitted in partial fulfillment of the requirement for the award of degree of MASTER’S OF BUSINESS ADMINISTRATION Session (2009-11) UNDER THE GUIDENCE OF MISS. MEENAKSHI SRIVASTAV (FACULTY)

Submitted by

SAURABH GUPTA MBA (Marketing) Roll No- 0922270043

ITS ENGINEERING COLLEGE (222) Greater Noida

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CERTIFICATE

This is to certify that the Research Project Report entitled “Consumer Behavior In Online Shopping” being submitted by ________________ for fulfillment of the requirement of Gautam Buddh Technical University, Lucknow is a record of an independent work done by his under my guidance and supervision.

Dr..A.S.Pandey

Ms.Meenakshi Srivastav

HOD-MBA

Concerned Faculty Guide

ITS Engineering College

ITS EngINEERING College,

Greater Noida.

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DECLARATION

I Saurabh gupta to declare that the Research project report entitled “Consumer Behavior In Online Shopping” being submitted to the GAUTAM BUDTH TECHNICAL UNIVERSITY for the partial fulfillment of the requirement for the degree of Master of Business Administration is my own endeavors and it has not been submitted earlier to any institution/university for any degree.

Place: Date:

(

)

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TABLE OF CONTENTS S.No Particulars

Page number

Chapter 1 1.Introduction

1-26

(Theoretical Foundation, Evolution of subject and its Dimensions 1.1 Executive summary

10

1.2 Introduction

12

1.3 Theoretical Foundation

15

1.3.1 Online Shopping in India

15

1.3.2 Rising connectivity

18

1.3.3 Factors that Boot Online Shopping in India 1.3.4 Few Facts about Online Shopping

19 19

1.3.5 Changing Attitude Towards Online Shopping

19

2 Review of literature

28-34

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3 Need, Objectives ,Scope & Methodology

36-40

3.1 Need

36

3.2 Objective

36

3.3 Scope of Study and Methodology

37

3.3.1 Scope of Study

38

3.3.2 Research Methodology

38

3.3.3 Research Strategy

39

3.3.4 Descriptive research method

39

3.4 Sample Design

39

4 Data analysis (factor analysis through pai charts)

41 - 50

5 Summary ,Conclusion ,Limitations & Recommendations

52 -67

5.1 Summary

53

5.2 Conclusion

55

5.3 Limitations& Recommendations

57

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6 References

66-

67

7 Appendix,(Questionnaire, Terms,

69-

71 Abbreviations,Documents,Performa,Financial Statements

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CHAPTER-1 Page | 9

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INTRODU CTION TO SUBJECT Page | 11

1.1 Executive summary The growing use of Internet in India provides a developing prospect for online shopping. If E-marketers know the Factors

affecting online

Indian behavior, and the relationships between these factors and the type of online buyers, then they can further develop their marketing strategies to convert potential customers into active ones, while Page | 12

retaining existing online customers.

This project is a part of study, and focuses on factors which online Indian buyers keep in mind while shopping online. This research found that information, perceived usefulness, ease of use; perceived enjoyment and security/privacy are the five dominant factor s which influence consumer perceptions of Online purchasing.

Consumer behavior is said to be an applied discipline as some decisions are significantly affected by their behavior or expected actions. The two perspectives that seek application of its knowledge are micro and societal perspectives.

The online purchasing behavior of online shoppers and factor influencing online shopping behavior and its future perspective. Internet is changing the way consumers shop and buy goods and services, and has rapidly evolved into a global phenomenon. Many companies have started using the Internet 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. Companies also use the Internet

to convey, communicate and

disseminate information, to sell the product, to take feedback and also to conduct satisfaction surveys with customers. Customers use the Internet not only to buy the product online, but also to compare prices, product features and after sale service facilities they will receive if they purchase the product from a particular store. Many experts are optimistic about the prospect of online business.

In

addition

market,

the

to the

tremendous

potential

of

the

E-commerce

Internet provides a unique opportunity for companies

to more efficiently reach existing and potential customers. Although Page | 13

most

of

the

revenue

business-to-business

of

commerce,

online the

transactions practitioners

comes of

from

business-to-

consumer commerce should not lose confidence. It has been more than a decade since business-to-consumer E-commerce first evolved. Scholars and practitioners of electronic commerce constantly strive to gain an improved in sight into consumer

behavior

in

cyberspace. Along continue

with to

the explain

development E-consumers

perspectives. Many of their

of

E-retailing, behavior

from

researchers different

studies have factors or assumptions

which are based on the traditional models of consumer behavior, and then examine their validity in the Internet context

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1.2 Introduction Internet is changing the way consumers shop and buy goods and services, and has rapidly evolved into a global phenomenon. Many companies have started using the Internet 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. Companies

also

use

the Internet to

convey

communicates and

disseminate information, to sell the product, to take feedback and also to conduct satisfaction surveys with customers. Customers use the Internet not only to buy the product online, but also to compare prices, product features and after sale service facilities the will receive if they purchase the product from a particular store. Many experts are optimistic about the prospect of online business. In addition to Page | 16

the tremendous potential of the E-commerce market,

the Internet

provides a unique opportunity for companies to more efficiently reach existing and potential customers. Although most of the revenue of online transactions comes from business-to-business commerce, the practitioners of business-to-consumer commerce should not lose confidence . It has been more than a decade since business-toconsumer E-commerce first evolved. Scholars and practitioners of electronic commerce constantly strive to gain an improved insight into consumer behavior in cyberspace. 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 or assumptions which are based on the traditional models of consumer behavior, and then examine their validity in the Internet context

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Factors affecting students’ attitude toward online shopping Today Internet is not only a networking media, but also as a means of transaction for consumers at global market. Internet usage has grown rapidly over the past years and it has become common means for delivering and trading information, services and goods (Albarq, 2006). According to ACNielsen, more than 627 million people in the world have shopped online (ACNielsen, 2007). Forrester (2006) research estimates ecommerce market will reach $228 billion in 2007, $258 billion in 2008 and $288 billion in 2009. By 2010 e-commerce will have accounted for $316 billion in sales, or 13% of overall retail sales. A study by International Data Corporation (IDC) Asia Pacific indicates that the future forecast for online shopping in Malaysia looks bright and promising (Louis andLeon, 1999). Malaysia moved towards advanced information, communications based on the growing trend of Internet users in the last three years and multimedia services. Moreover, due to a rapid rise in the number of PCs in Malaysia, as well as growth in the proportion of PCs hooked up to the Internet each year, provides greater opportunities for Malaysians to conduct both business and shop online (Legard, 1998). A mid-2005 survey by the Malaysian Communication and Multimedia Corporation (MCMC), only 9.3% of Internet users had purchased products or services through the Internet during the preceding three months. Taylor Nelson Sofres (2001) found that the penetration of Malaysians shopping online, that is, people who bought or ordered goods and services online in 2000 was 1% of the total younger population in Malaysia. Malaysia internet shoppers are relatively young, highly educated, having higher social status, and command a more favorable financial position.Mohd Suki et al. (2006) conducted a study Page | 21

among Malaysian students and found that they enjoyed purchasing books/journals/magazines through the internet. ACNielsenalso reported that, across the globe, the most popular items purchased on the internet are books

34%,

followed

by

videos/DVDs/games

22%,

airline

tickets/reservations 21% and clothing/accessories/shoes 20% (ACNielsen, 2005). Considering that Internet shopping, is still at the early stage of development, little is known about consumers’attitudes towards adopting this new shopping channel and factors that influence their attitude toward (Haqueetal., 2006). The consumers’ attitude towards online shopping is known as the main factor that affects e-shoppingpotential (Michieal, 1998). Attitudinal issues are also thought to play a significant role in ecommerce adoption. That means that, through motivation and perception, attitudes are formed and consumers make decisions. Thus, attitudes directly influence decision making (Haqueet al.,2006). Attitudes

serve

as

the

bridge

between

consumers’ background

characteristics and the consumption that satisfies their needs (Armstrong and Kotler, 2000; Shwu-Ing, 2003). Because attitudes are difficult to change, to understand consumers’ attitudes toward online shopping, can help marketing managers predict the online shopping intention and evaluate the future growth of online commerce. The proliferation of online shopping has stimulated widespread research aimed at attracting and retaining consumers from either a consumer or a technology-oriented view. The two views do not contradict but rather reinforce each other. Because the success of an electronic market largely depends on consumers’ willingness to accept it. Due to this, we adopted the consumer-oriented view of online shopping in this study. The consumer-oriented view focuses on consumers’ attitude about online shopping. For example, online consumer behavior has been examined from the perspectives of perceptions of benefits toward online shopping (Bhatnagar and Ghose, 2004a, b; Garbarino and Strabilevitz,2004; Huang Page | 22

et al., 2004; Liao and Cheung, 2001; Pavlou, 2003). The potential benefits of online shopping for consumers include convenience, various selection, low price, original services, personal attention and easy access to information, among others. Moreover, shopping orientation (Korgaonkar and Wolin, 1999; Li et al., 1999; Safavi, 2007; Swaminathan et al., 1999). Therefore, it is thus important to recognize that numerous factors precede attitude formation and change. In addition, understanding consumer attitude toward onlineshopping helps marketing managers to predict the online shopping rate and evaluate the future growth of online commerce (Shwu-Ing, 2003). The rest of the paper is organized as follows: first examines the relationship between consumer factors and attitude toward online shopping and second, analyzes consumer factors that influence attitude toward online shopping.

1.3 Theoretical Foundation The Internet has dev eloped an into a new distribution channel and online transaction are rapidly increasing. This has created a need to under how the consumers perceive online purchasing .

Price, Trust and Convenience were identified as important factors. Price was considered as to be a most important factor for a majority of the

students.

The internet has

traditional way people shop.

created a paradigm

shift

of

the

A consumer is no longer bound to

opening a times or specific location. So he can become active at virtually any time any place and purchase the products or services.

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The internet is relatively a new medium for communication and the information exchange that has present in everyday life.

The number

of internet user is constantly increasing which is also signifies that online purchasing is increasing. The rapid increasing is explained by the consumer behavior. The internet is considered a mass medium that provides the consumers with purchase characteristics as no other medium.

Certain characteristics are making it more convenient for

the consumer compared to the traditional way of shopping, such as the ability to any time view and purchase products visualize the needs with products and discuss products with other consumers. Online shopping is the process of consumer go through the when they decide the shop on the internet.

The internet has developed into a new distribution channel and the evaluation of this channel. E-commerce has now identified .

Using

the internet to shop online has become one of the primary reasons to use the internet combined with searching for products and finding the information about them. Therefore internet develop the Companies also use

the

Internet

to

convey , communicate and disseminate

information, to sell the product, to take feedback

and also to

conduct satisfaction surveys with customers. Customers use the Internet not only to buy the product online, but also to compare prices, product features and after sale service facilities they will receive if they purchase the product from a particular store. Many experts are optimistic about the prospect of online business.

Due to the rapid development of the technologies surrounding the Internet, a company that is interested in selling products from its web site will constantly has to search for an edge in the fierce competition. Since there are so many potential consumers, it is of the out most importance to be able to understand what the consumer wants and needs. Page | 24

1.3.1Online Shopping In India It is a fact that a great online shopping revolution is expected in India in the coming years. There is a hug e-purchasing power of a youth population aged 18 -4 0 in the urban area.

Rise of Online Shopping In India E-commerce is seeing a steep rise according to Assocham (Associated Chambers of Commerce & Industry of India). Two metros (Delhi and Mumbai) are driving this growth with each contributing 24% and 20% of the E-sales log on share respectively! A major reason why metros are contributing to e-shopping growth is the literacy rates and the cities’ internet savvy population. In cities like Delhi safety could also be a major cause! It’s very surprising that Bangalore being the IT Hub of the country contributes a very meager 6%. They have also predicted that ecommerce will cross 9000 cores by March 2008. There are many online shopping portals like http://www.futurebazaar.com and http://www.indiaplaza.in where consumer durables are sold but they have no option to shop for groceries online! Catering to this very need is a new startup online portal on the rise http://www.storrz.com which is a product of Just On Demand Technologies Pvt. Page | 25

Ltd, a firm based in Bangalore and claims to be the first Online Shopping Portal in India that allows customers to shop for groceries online. Speaking of groceries, it has got over 3000 products in this segment alone! That’s like WOW! Interestingly, it also offers 24 hrs delivery for all products, bettering the delivery services provided by other Online shopping portals. It provides customers with the option of swiping their credit/debit cards at the time of delivery! Storrz representatives carry a mobile enabled point of sale device to the customer's door step to make this happen. This seems to be a brilliant option as customers can now get to know what groceries they are actually buying before finalizing the bill! Besides this, one can also select SodexHo Meal Passes as their payment option allowing a large number of coupon holders to now use their coupons Online! This delivery covers the whole of the country using Blue Dart's Domestic Priority Service for 24hrs delivery. At present certain categories like perishables are limited to Bangalore only. It has tied up with Major Retailers and OEM Brands like Namdharis Fresh, MTR, Dr Morepen, Jus’Trufs, Mars, Pedigree, Tilia, The Art of Living, Indus Tree Crafts etc. Storrz.Com MD and CEO Chandan Maruthi Says "We are happy to have 40% of business come from repeat customers. We make sure that every shopping is a memorable experience for the customer and no stone it left unturned to make sure that customers are satisfied. We have also made multiple payment options available for the customer like Pay by Card at Home and Pay by SodexHo pass"

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Features of Storrz.Com Shopping Mall for Manufacturers and Retailers: • Fully equipped Online shopping store that can be setup and launched quickly • Online Store is placed along with other premium brands in the shopping mall Page | 27

• Drive both direct and indirect traffic with the Shopping Mall environment • Built on cutting edge technologies like AJAX, XML and more, the system has taken over 5 person years to develop • Fully integrated with Leading Payment Gateway solutions, SMS Gateways, Email Gateways etc Overall, it's a pretty good concept with a lot of promise!

Online Shopping in India – Why More Shoppers Are Not Ordering Online

Online shopping is quite common these days in the developed world than it was about 5 years ago but it is not the same in India for its own set of reasons. In developed economies consumers find the worldwide web a great place for bargainhunting, with most goods available at lower prices than in a bricks-and-mortar store. But convenience appears to be an even bigger attraction as revealed in surveys because most online shoppers find the crowded high street too stressful.

Though online shopping has witnessed growth in India but it is still not pervasive like the west and the growth is also limited to certain areas like online travel booking and perhaps stock trading (which actually is not pure e-commerce). The main reason why shoppers in India are not willing to shop online is that they don’t get any real value or incentive. Also they are wary about fraud, delivery and customer service and their fears are not imaginary. Page | 28

The first issue that online consumers are facing in India is the narrow range and limited choice of merchandize. Even the leading sites like ebay.in, indiaplaza.in, indiatimes or rediff have very limited range of items and therefore are hardly attractive. I personally searched many a times for books and music titles among other things in the Indian sites but seldom found any great product and never exciting prices.

In spite of limited range still some consumers want to buy online just for the sake of convenience but then their experience is also not good. There are too many cases of delayed delivery, damaged or inferior goods, quality issues and even instances of cheating where the goods were never shipped.

Once I bought 3 items from Sify shopping to gift a friend of mine and to my horror I came to know that out of 3 items only one was okay, another was damaged and the third once never sent at all. Needless to say there was no help from sify customer care and my complaint only fell to deaf ears and I was actually cheated. My experience with ebay.in was also bad; I ordered an electric hot plate which took more than double time than it was promised and finally one of he hob went off just after 2 days.

But the worst part of Indian online shopping is most of the goods are actually priced more than the street price which is just so ridiculous. Some sites like rediff and indiatimes do sell some cheap items but then they are mostly unbranded or low quality Chinese goods and basically waste of money. Here in India, you cannot expect any thing from your online merchants; no killer deals or exciting prices, no delivery guarantee, no after sales support or replacement warranty.

So as long as the online shopping sites continue to give raw deals to the Page | 29

shoppers buyers in India would prefer to shop from brick-and-mortar stores where at least they can inspect the product and bring them back for replacement or refund if found faulty. And this trend is quite natural as why one would buy some inferior goods at higher price where there is no commitment of delivery or after sales service. There are some people who are buying on net but in most cases they are one-time customers who will think twice to visit again after burning their fingers.

This is not an imaginary account and anybody can easily check out the facts about the customer satisfaction level of online shoppers in India. Just visit any product review website and start searching for keywords like “ebay”. You will find lots of complaints and damning reviews which actually speak about the harassment and misfortune that these poor consumers had to face as they chose to buy online.

However, there is a demand for e-commerce in this country as people have less and less time to shop. I need not go to a store to buy books, music or gift items and if I can get a better price and some guarantee of after sales I will even buy capital goods like fridge or laptop computers from net.

Today consumers are looking for real good deals and they are not fools that you can hoodwink them. I am sure there are more people in India who buy books and music from amazon than those who shop regularly at rediff or indiantime and they do it because they can trust Amazon and get value there even if they have to pay hefty handling charges for the distance.

I purchase books regularly from amamzon because I know I will find any damn book in that site and I need not look around. Their customer service is also impeccable and on most occasions they have shipped before the Page | 30

expected delivery date. Precisely, this is the kind of value what the Indian shopping sites need to deliver to Indian customers because as the shopper will find value they will have no problems to shop online. Jaydeep Bhattacharjee writes on consumer issues concerning the Indian consumers. He is the founder of http://www.admanya.com – India’s leading C2C portal. Admanya is free and it completely depends on consumer participation for its content. Join Admanya and be an empowered consumer – you can read or write a review about almost any product or service.

1.3.2Rising Connectivity If we observe the growth of Internet Subscribers from the above graph, it is getting doubled year by year. The usage of internet in India is only 4% of the total population. This is also getting increased day by day as the costs of computers are decreasing and net penetration is increasing. The cost of internet usage is also getting lower, with good competition among the provider s. Wi-Fi & Wimax system has also started in India. This will increase the usage as it goes more on wireless internet. Indians are proving every time that they can beat the world when it comes to figures of online shopping. More and more Indian s are going to online shopping and the frequency of India’s online buying is crossing the overall global averages.

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1.3.3

Few Factors That Boost Online Shopping in

India  Rapid growth of cybercafés across India  Access to Information  The increase in number of computer users  Reach to net services through broadband  Middle-class population with spending power is growing.

There

are

about

200 million

of middle-class

population

good

spending powers. These people have very little time to spend for shopping. Many of them have started to depend on internet to satisfy their shopping desires

1.3.4 Few Facts about Online Shopping The figures from IAMAI show that the internet users in India will grow to 200 million by 2010. Around 25% of regular shoppers in India are in the 18 -25 age groups, and 46% are in the 26 -3 5 year range. Page | 32

Indian online matrimonial sector is worth around $230 million Worldwide E-commerce is only growing at the rate o f 28%, since India being a younger market, the growth of ecommerce is expected at 51% in the coming years.

In line with global trends finally India has also started shopping Online these days. As per the study by IAMAI online shopping in India has rose from $11 million in 1999 2000 to $ 522 million in 2007 and it is expected to rise above $70 0 million by end March 2010.

1.3.5 Changing Attitude towards Online Shopping: “Awareness, Future Demand Focus for Emerging Markets & Current Issues” Malls springing up everywhere and yet people are E-shopping . And not in small numbers either. Consumers are more rational nowadays and have ability to get the choices from the market. Awareness among the consumers is spread through internet. The number of internet users is increasing day by day which attracts people who have an option to buy online. It was never thought that Indians would go in for e-shopping in such a big way. Ticketing, travel bookings and even books and movies seem fine to buy online. Knowing that in India sizes vary from brand to brand and quality is inconsistent, even of some electronic items, how is it that there are people buying these items online? In India there are some segments of people who have not yet tried purchasing over internet.

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1.3.6 The Increase of Internet Shopping Internet shopping is shaping up. However today, internet shopping is a really significant part of the retail sector. Internet shopping is the new shopping experience of the future. Of course the other major hurdle for internet shopping is shipping charges, sometimesthey are to expensive. The growth rate for Internet shopping is growing. Secure internet shopping is secure using encryption and ssl techniques. Internet shopping is easier, safer, and more convenient than at any point in its history. Internet shopping is fast becoming one of the easiest ways to buy almost anything you want. Internet shopping is a way of shopping that allows shopping for required products without going to the store physically. The Internet is great because people are able to shop 24 hours a day without having to leave their home or work. The Internet is changing the wholesale/retail landscape daily. In today's market the shopping sector is taking about a tenth of all retail shopping sales in the US, and the percentage in other countries is not as high. One reason we use the internet is to buy merchandise at a discount to retail. One of the biggest benefits of shopping online is the convenience and access to more products and information 24 hours a day 7 days a week. Note that blocking all cookies prevents some online services from working, so you must allow cookies on your Page | 34

browser. Nearly 40 percent of remote workers said they use their work computers for Internet shopping. Be a smart shopper and use common sense when online shopping and just go ahead and enjoy your Internet shopping experience today. The more people that shop online, the bigger their expectations. The supermarket industry now services many customers through online food shopping over the Internet. We understand that shopping online can feel risky and uncertain.

The following tips will help ensure a safe Internet shopping.  If you follow this advice on safe Internet shopping, this should not be a problem. All purchases are made through safeand secure servers.  It's safe to say SSL is extremely sophisticated software and safe. Always know where your cards are and keep them in a safe place.  The phenomenal success of online retailers such as Amazon and Expedia is proof that internet shopping is practiced - and trusted - by millions.

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 Of course the other major hurdle for internet shopping is shipping charges, sometimes shipping is much more than the product. Whether we love it or hate it, Internet shopping is convenient, provides a wide choice and competitive prices.  Internet shopping is a big time-saver. As mentioned above, Internet shopping is very much like conventional in-home shopping from catalogs or mail orders.

Despite the toughening competition, Internet shopping is likely to continue to grow. Chris O'neill and David Marc Fishman are the owners of priceriot.com. Priceriot is a new online auction where prices drop as people shop for computers

Incredible Online Shopping Trends Among The Shoppers

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Online shopping has become a craze not only in India but also in various Western Europe cities and if experts are to be believed, the rave is a steady phenomenon for the five years down the line. Before sinking in the surveys andstatistics, let we get an idea that why online shopping is getting popular by each passing day in the global continents. Emerging prevalence of internet, growing economies and improved purchasing power of people have made online shopping a household phenomenon. All you have to do here is to select a product here of your choice, place your order, pay your amount via debit or credit card and within a week time that item will be your doorstep.

In the status report of several authorities, the trend of online shopping and integrated sales has been increased by an incredible amount of 123.1 billion Euros in the coming three years. In the same foray, a combined annual online shopping growth rate is improved by a huge percentage of 9.6%-11% all across.

A number of factors have accelerated the growth of online shopping growth in the countries including:

Improved mail order retailing



High population density



Extensive array of product categories



above-average confidence in online security



wide variety of payment options

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America and Western Europe are probably the biggest ever markets where a huge population of its youth buys goods and objects with online mode regularly. The percentage and ratio of the items purchase differ from person to person and depends upon one’s personal choice and preferences. Below mentioned is the number of items in percent unit that buyers love to buy via the online mode of shopping.



CDs/tapes/records (17%)



Videos/DVDs (17%)



Event tickets (20%)



Printer supplies (12%)



Books (30%) Page | 38



Leisure travel (23%)



Clothing (21%)



Computer software/video games (11%)

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Online Shopping in India Gives You Enticing Experience It is a very simple and easy way to buy a lot of products through online shopping in India. In fact, these stores offer various payment options as per the customer's suitability. Simultaneously, you can compare the product's price and features from among products being offered at several online shopping stores in India. India has been a dominating power in the world of online shopping in the recent times and is widely known for its niche reputation in the global arena. It is all due to its far reaching excellence in the field of online marketing that has managed it to gain a competitive edge over its close competitors. Alongside, it is also heavily responsible for bringing about an unprecedented boom in the field of online marketing. Online shopping in India is a very simple and easy way as whatever you like to buy, you can order online and receive at your doorsteps.

While opting for online shopping in India, you can seek valuable advices and suggestions from your family and friends. Alternatively, you can simply ascertain your requirements, look out for the product over the Internet that caters best to your requirements and buy the one that is available at the most reasonable cost. Online shopping India is highly preferred by countless people, since it not only enables them to shop in the comfort of their homes, but it also gives them due value for their money along with safe and secure payment Page | 40

modes such as PayPal, credit card and more.

Information related to costs, features and specifications of numerous items including baby products, jewelry, health equipments, mobile phones, computer and myriad of other electronic devices are provided on various websites. For making your online shopping experience the best and most satisfying one, you can browse through innumerable websites that offer all these and many more products. You can compare products from multiple online shops and buy the one or more that suit your requirements at the most competitive rate. If you want to make any query, there is nothing to worry about as some reputed online shops may also offer 24X7 online support to their customers to solve their queries.

Other Advantages of Online Shopping India Include: - You can read other users' reviews and take ideas about the product you want to buy

- You can save a lot of your time and money as you are not moving outside your home

Thousands of websites related to online shopping in India have been designed to fulfill the needs of different customers. The manifold benefits that you get are simply incredible. Many leading online stores are offering products at discounted rates in order to promote their products among people across the world.

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India Online: How the Fastest Growing Economy is Powering the Fastest Growing Communications Industry

In the heart of the Himalayas lies Leh, a small mountain town cut off by snow most of the year and only accessible in summer via a precarious cliff road. Despite Leh’s isolation every shop front, garage door and spare wall is adorned with Vodaphone and Airtel logos. In India it is difficult to move without seeing an advert for a telecommunications company. To say that the telecommunications industry is booming in India is very nearly an understatement. Since 2000 the industry has attracted $10 billion dollars of foreign investment and now employs over 9 and a half million people.

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The isolated town of Leh. Photo by Ben Semens

In India the number of users online remained below 10 million until relatively recently. To put things in perspective the number of Indians online surpassed the 10 million mark back in 2003, whilst the US stormed ahead with the same number in 1995 and the UK in late 1998. These are very different economies, but it shows how far India has come. From an economy stunted by inefficiencies and lack of competition, India has removed constraints and now more customers than ever are coming online. Within five years the industry is expected to be worth $100 billion and it’s not showing any sign of slowing. The sub-continent’s economy is weathering the economic storm well and thanks to a strong export market it’s expected grow a further 8% this year, allowing telecommunications to prosper.

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However India still has a steep climb out of poverty. In India at the moment only 1% of the population have broadband access, a few million more users than in the UK despite the fact that the UK has a population a fraction of the size of India. But the situation is not quite as severe as these figures may suggest because any of India’s Internet users connect via mobile phones. There are nearly 800 Million wireless subscribers compared to only 11 million wired users, this significantly boosts India’s online population. But India’s users may also be holding growth back. Few Indians have credit cards, which makes it difficult for online shopping to function. That said, advertisers don’t have this problem and services such as YepMe, India’s answer to local search, appear to be flourishing. Given time and room to expand the sector will surely find ways to innovate around the payment issue. Over the next five years the government is planning on rolling out its National Broadband Strategy that will see fibre optic cables laid across the nation. Page | 44

Deregulation if boosting competition incentives are being given to green technologies. So despite the challenges India faces the telecommunications industry is poised undergo huge growth over the next decade and if it can innovate around the payment problem the customer base is practically limitless. When India truly comes online the Internet will swell to nearly twice the size and will be a strikingly different place. No longer dominated by western-based companies the Internet will be reshaped as Indians create their own web to suit their own needs.

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CHAPTER-2 Page | 46

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Review of Literature

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2.1 Review of literature Petrovic Dejan (2006) behavior

online

in his study on Analysis of consumer

explained that

the most

relevant

behavioral

characteristics of online consumers and examine the ways they find, compare and evaluate product information. Comparison of the newly collected survey data with the existing consumer behavior theory resulted in detection of a number of issues related to a specific consumer group. The purpose of this report is to translate these finding s into a set of implementation

activities

on

strategic

and technological

level.

Execution of these recommendations will result in better conversion of visitor s into customers and encourage customer loyalty and referrals .The focus group of this study will be young adults aged between eighteen and thirty -four interested in buying a mobile phone or a related product . Page | 49

Shun & Yunjie (2006)

in their study

showed that there are

product types, which are more likely to be sold online such as software, books, electronics and music. Reason for this is that when purchasing these types of products, one does not require personal inspection and most, if no t all features, can be outlined in the product description and images. Most products in the mobile phone family belong to this category. Accor ding to the recent research on consumer behavior on the Internet users

there are four distinct

consumer groups with different intention s an d motivation :  Exploration  Entertainment  Shopping  Information

Music Videos, Lyrics - Daily updated collection of music videos an d lyrics. Majority of young adults interviewed for purpose of this research tend to be active information seekers. A high level of technological

confidence

within

this

group

tends

to

be

an

encouraging factor when it comes to product information research online .The following analysis presents both, focus group results and behavioral theory in a parallel fashion divided into two main research topics: Information Retrieval and Search Patterns

Perception of Product Information Online These two areas is mutually dependent and particularly important in a market where consumer s have the power to choose the right product from a number of competing suppliers . Well-structured product information that cannot be found easily online is as much of a problem as is having easily accessible information that does not meet the consumer's expectations Page | 50

Anders Hasslinger ; Selma Hodzic ; Claudio Opazo (2008-02-01) their study

in

they showed that developed into a new distribution

channel and online transactions are rapidly increasing. This has created a need to understand how the consumer perceives online purchases. The purpose of this dissertation was to examine if there are any particular factors that influence the online consumer. Primary data was collected through a survey that was conducted on students at the University of Kristianstad . Price, Trust and Convenience were identified as important factors. Price was considered to be the most important factor for a majority of the students.

Furthermore three segments

were identified, High Spenders, Price Easers and Bargain Seekers. Through these segments we found a variation of the different factors importance and established implications for online book stores

Harris Interactive

( 2009) in their study of

online customer

experience. The survey found that online customer experience reached an inflection point in 2009. The percent of consumer s who have experienced problems when conducting transactions online showed its first substantial decrease in five years from approximately 87% in all previous Tealeaf surveys to 80% in 2009. While the percent of consumers experiencing online transaction problems, at 80%, remains high (the potential online shopping dollars impacted by transaction problems rings up at $47.6 billion), this improvement points to a growing business focus on delivering better customer experiences. The survey sheds light on forces driving this accelerated online customer experience

focus,

including

the

down economy

and

increased

consumer power due to experience-sharing via social media. It also Page | 51

examines consumer behavior when transacting online, call center behavior elated to online issues and mobile commerce. Verticals represented in the findings include retail, insurance, travel and financial services

San Francisco, CA – 6th October 2009

- the leader in online

Customer Experience Management software (CEM), today announced the results of the 5th annual survey of on line consumer behavior, commissioned by Tealeaf and conducted by Harris Interactive® [results available at www.tealeaf.com/Harris]. The survey found that 48% of U.S. online adults say that they are now conducting more on line transactions than they did in the past given the current economic climate. However, 80% of adults who have conducted an online transaction in the past year experience problems when doing so in 2009.

Previous

Tealeaf

surveys

have

consistently

shown

that

approximately 87% were affected .

This improvement over prior year s may be attributed to a growing business focus on delivering better online customer experiences. While this reported decline in on line transaction issues is good news, online customer experience is still very much a work in progress. The percentage of consumers affected by issues such as error messages (38%), endless loops (19%) and login problems (28 %) is still extremely high. Further the 1resulting business impact is significant, as 32% of those who experience issues when conducting transactions online would simply take their business elsewhere (to either an online or offline competitor) or abandon the transaction entirely. In 2009, $47.6 billion will potentially be impacted by online transaction problems, on U.S. shopping websites alone.

Page | 52

Bikramjit Rishi (2010)

in their study on

Online shopping

is an

innovative option of distribution available in the hands of marketers. It is innovative an d creative because marketers can experiment with it in form, content, visibility and availability. In India online shopping is considered as a relevant alternative channel for retailing and it is now an important part of the retail experience. This research study is an empirical study to find out the motivators an d decisional influencers of online shopping. The sample has been selected from the youth population as this group of people actually use internet to buy online. The study highlights that reliability; accessibility and convenience are the major motivator factors which motivate the Indian consumer to buy online. Similarly, reluctance and preference are the two decisional factors which in fluence the decision.

Kamali and Loker (2002), in their study Intern et retail sales represent

a new and increasingly vital

commercial

milieu.

E-

commerce or electronic commerce saw sales revenues grow 12 .1 percent in 2001 to $ 31.4 billion a figure expected to reach $ 81.1 billion by 2006 ( Kamali & Loker, 20 02). While it is clear that many more consumers are electing to shop online than in the past

a shift

in behavior that may be due to the sense that online shopping is safer and more secure than it was initially and to the adoption of Page | 53

alternative

shopping avenues. This essay will examine these issues,

arguing that browsers become buyers in cyberspace as perception of safety, product quality, and retailer reliability increase an idea also advanced by Li, Lu o, Lepkowaska-White and Russell .

Atanasov (2001)

in their study it is anticipated that the worldwide

mark et for business-to-business and business-to-consumer e-commerce will total $3.1 trillion in 2004 as compared to $ 350.4 billion in fiscal 2000-2001. Among the most profitable products and services sold online are consumer goods such as books, videos, music, computers and other tech products, and travel (Schmerken, 2001). Other profitable sectors include investment transactions, which Schmerken (2001) considers to have generated a wave of corporate spending on ecommerce. The Internet and its myriad e-commerce or marketing sites, represents what researchers believe to be the security concerns of online shoppers and potential shoppers. These researchers and others reported that online buyers are also concerned about security issues when making online purchases.

Though many consumer concerns

regarding the inherent safety of financial transactions online have been resolved through the development of sophisticated encryption programs, many consumers require additional assurance that their financial data will be held in confidence. Other security issues that were identified by Mauldin and Arunachalam (2002) focus on retailer disclosures, information risk, product risk, and familiarity with the retailer and the product. Generally, Mauldin and Arunachalam (2002) found that intent to purchase rather than merely browsing online increases in direct association with a sense of security and comfort. Retailers who offer their products online are therefore advised to emphasize product disclosure and retailer disclosure and reduced information risk in their e-commerce sites. Though most online retailers do provide clear descriptions of security procedures, some Page | 54

Internet shoppers still avoid using credit cards online. Overcoming resistance to this fear is one of the key tasks that must be under taken.

Ogenyi Ejye Omar, Alan Hirst (2006)

in their study they

evaluates women's attitude as an overall inclination towards apparel shopping online via e-mail questionnaire. Its findings suggest that women generally show positive attitudes towards shopping online for apparel. Women who shop for apparel online are aware of some of the discouraging features of online shopping, but these features do not deter them from buying online. The implication for online retailer s is that they should focus on making the experience of online shopping more accommodating and more user -friendly. This is important because the positive features of online shopping ('convenience', 'usefulness', 'ease of use', and 'efficiency') appear to be more important than the negative features ('lack of security', 'privacy of information' and 'online fraud').

Ruiliang Yan, John Wang (2009) in their research it provides a useful framework to help business marketers identify the effect of consumer online purchase costs on firm performances in online and traditional channel competition. A game theory model is developed to determine the optimal strategies for online and traditional retailers. We demonstrate that consumer online purchase costs always have a valuable impact on firm profits, and further show that consumer online purchase costs always have a much more valuable impact on firm profits whenever the traditional retail transaction costs and the product web-fit change. We also find that consumer online purchase costs have a greater impact on the retailer's profits in a Stackel berg competitive system than in a Bertrand competitive system. Based on Page | 55

our results, managerial implications are discussed and probable paths of future research are identified.

Scott M. Smith, Chad R. Allred, William R. Swinyard(2008) in their research paper they

discusses online shopping in context of

diffusion of innovation theory. It proposes that online shopping is a discontinuous innovation whose adoption rate is influenced by several of Rogers' (2004) diffusion deterrents. A new 12 -item 'Computer Competence Index' (CCI) is proposed and tested using data from an intern et-administered US probability study of 1800 online users. E-Shoppers are profiled using a tertile split of the CCI . Each textile’s demographics, computer activities,

computer-oriented

lifestyles, and online purchase activities are reported. Evidence is presented that concepts related to the diffusion of innovation

may

explain resistance in the growth of online shopping

A.M. Sakkthivel (2009) in their research paper aims to identify the impact of demographics on consumer buying behavior towards online purchase

of

different products

based on

the

involvement

and

investment (High , Medium and Low). It attempts to unearth the impact of the demographics on online purchase which is at present relatively limited. It would help the marketers to identify the demographic profile of consumers which is otherwise not known due to the intangible nature of internet. The findings would help the marketers to design their offerings based on the demo graphic profile of online consumers and would help the online marketers to identify and segment the online consumers which will enhance their focus and eventually leads to financial growth.

Jianwei Hou, Cesar Rego (2007) in traditional auctions, it is often in their study assumed that bidders are a homogenous group. Page | 56

However, since most online bidders are average consumers instead of professional

bidders,

we

suspect

that

online

bidders

are

a

heterogeneous group. The purpose of this paper is to explore the types of online bidders based on their real bidding behavior in the context of consumer -to-consumer online auction mark et. A cluster analysis is employed and four types of online bidders are finally identified in a private

value

auction,

namely,

goal-driven

bidders,

experiential

bidders, focused bidders, and opportunistic bidders. The profile and performance of each group are also discussed.

Tomomi Hanai

Takashi

Oguchi (2009)

, in

their

study

to

investigate what kind of information contributes to trust formation in online shopping. Twenty-seven female undergraduate students were recruited and asked to evaluate the trustworthiness of 20 online shopping websites. All the online shopping websites dealt with branded

products where

there

is

greater

emphasis

on

the

trustworthiness of online shops or products. The results show that information described on the websites was classified into two categories, firstly, information about the shop and its procedures and services. Secondly, the concrete information necessary for the consumption process, such as payment information and return information, which heightens the reliability of these shops . The term “brand” originally refers to a “description or

trademark

which

indicates a type of product made by a particular company.” However, in modern Japanese society it refers to those branded products that are perceived to have a higher quality than other similar products. Thu s, the term “brand” authenticates that its products belong to a high class, and the people who possess these branded products are regarded as “exclusive people” through the “basking -in-r effected glory process” (Cialdini, Borden, Thorne, Walker , Freeman, & Sloan, Page | 57

1976). The branded products interest female young people and recently they have been more inclined to purchase them via online shopping. However, they tend to refrain from purchasing these products via online shopping due to their distrust of it. Consequently , it becomes

more and

more important to analyze what

kind of

information contributes to trust formation in online shopping. Female Undergraduate Students Attitudes toward Branded Products First, we introduce several surveys for determining the attitude towards, and ownership

of,

branded

products

among

female young

people,

especially female undergraduate students in Japan, who are the target group of this study. Info plant (2007) showed that nearly half of all people are interested in some branded products. Although branded products generally attract the attention of various kinds of people, young females are especially interested in branded products. Info plant (2007) revealed that more than 60% of females under 20 years of age and nearly 80% of females in their twenties have purchased some branded products. Furthermore, the percentage o f people who usually buy new branded products is about 20% among females under 20 years of age and more than 10% in females in their twenties. .

David Anderson (02.02.2006) in their research carried out by a consumer behavior researcher at Henley

Management College

has

investigated what drives people to search online. The findings reveal that convenience, time-efficiency and personal control are the key drivers for consumers to search online, rather than cost. It also shows that the relation ship between traditional and online retailing outlets needs to be more unified E-shopping has changed the face of retail, and surfers are now looking for spring sale bargains.

This is Page | 58

following a bumper e-Christmas, where Internet shopping soared almost 5 0% during the 10 -week run-up to Christmas 2005 (IMRG).

However, the new findings reveal that convenience and personal control are the key drivers for consumers to search online. Dr Susan Rose, from Henley

Management College, said: “What motivates

online shoppers is the ability to shop, where, when and how they like. Nowadays people can shop over their Shreddies in the morning. The research, that analyses data from 304 electrical goods Internet shoppers, provides businesses with a guide to getting the information highway buzzing with potential customers. Big-ticket items such as digital TVs, cameras, or iPods now feature on our e-shopping list. The Internet provides a rich source of information about brands and retail channels that enable us to search and find information to help us with our final purchase decision. For businesses there are some steps to help them embrace the Internet revolution with success. A key factor driving Internet use for online window shopping is its usefulness in our personal lives. The Internet frees time and makes the information search process,Research suggests that people search online for some goods, yet buy from a traditional high street retailer, or look around for goods in shops, then take their search online. In turn, it is essential for retailers who operate both on and off line to ensure that they embrace a joined up process that appears seamless to the customer. Some retailers have still to successfully unite the two retailing methods - this is key to contemporary customer service. Factors such as how much the medium challenges us mentally and our confidence to navigate and understand the technology can turn us on or off the idea of browsing online for products. A clear divide is appearing between the occasional online shopper and the regular experienced user. Concerns about how easy the system Page | 59

is to use have almost disappeared for online shopping enthusiasts, but for occasional user retailing sites need to be easy to navigate. Websites must be accessible and operate efficiently. The research found that the expectation of getting a good financial deal is still a strong motivator to seek out pro ducts online, but this is secondary to the importance but, many people steer clear of electronic buying because of security worries. Only once online retailers can reassure customers about fraud and privacy, will the online shopping curve really take off. Worries about the risk involved, in terms of financial transaction and privacy remain. A move from big brands to , bargains may only take place once.

Rajeev Kamineni (JAN 1999) in their study The World Wide Web can change human behavior and human interactions to a very large extent. Web based shopping behaviour is one major example to point out the trends in this direction. This study is of a very exploratory nature and it intends to establish the differences between several web -based shoppers from different parts of the world. Several critical factors associated with online shopping behaviour will be explored. A cross

cultural

data

set

will

be

collected

and

an

illustrative

description of the shoppers will be provided. As a final step the cross cultural differences between several shoppers will be explored. One question which will run as a theme throughout the course of this paper is, “Will the traditional consumer behaviour theory and Page | 60

research be altered by the advent of web based shopping?”

There is a huge difference between a physical store and its electronic counterpart. A help button on the home page of the web-shopping site replaces the sales clerks friendly advice and service. The familiar layout of the physical store becomes a maze of pull down menus, product indices and search features. Now more than ever, the promise of electronic commerce and online shopping will depend to a great extent upon the interface and how people interact with the computer. At the same time, there are some inherent difficulties in maintaining an online inventory. In a regular store, the managers can pull out a product from the shelf if they feel that it is not fast moving or has no demand. This is a privilege that cannot be extended to the online retail store.

Anita Desai (2003) in her study E-tailing is the practice of selling retail goods on the internet. It is the abbreviated version of “electronic

retailing”

which

essentially constitutes

business

to

consumer transaction. While the concept of online retailing or eretailing is no longer in its nascent stage; it continues to evolve, as advanced

e-commerce applications act as a potent catalyst in the

development of e-tailing.

The idea of online retailing or e-tailing which almost every netsavvy individual is familiar with; offers a convenient mode of shopping online and the consumer gets to choose from a diverse range of products and services as opposed to the analogous physical shopping experience. Furthermore, online retailers or E-tailors get to expose and sell their products to a global audience through their e-stores. (Also termed as online stores, internet shops, web shops etc.) The

E-commerce industry plays

a vital role in its growth and Page | 61

development. The consumer or buyer is usually provided with detailed information and description of the product which helps them make a judicious choice before making an online purchase. For consumers who face a paucity of time or want a diverse range of products to choose from, e-tailing proves to be an ideal option. Every e-tailor wants his/her share of domain amidst the vast World Wide Web galaxy. Due to the intense competitor quotient involved, every etailor out there wants to offer their customer/buyer a smooth and pleasant shopping experience. Therefore, e-tailing is just not restricted to putting up products for sale for consumers to buy. As consumers today are well-informed, it is understood that they would make a well informed decision as well. This involves a fair amount of product research, price comparison and checking the credibility of the estore

Page | 62

CHAPTERPage | 63

3

Page | 64

NEED OBJECTIV ES SCOPE Page | 65

& METHODO LOGY

Page | 66

3.1 Need The need of this research is to identify and get insight into what main factors the online consumer takes into consideration when most he buy products on internet what affects their shopping behaviour, basic need of this research is to find out what are the main factors affect the online consumer when considering and making a purchase over Internet.

3.2 Objective of the study  To study the online shopping behavior of customers  To study the factors influencing online shoppers and consumers  To study the customers level of satisfaction with regard to online Shopping  To examine whether customers prefer online shopping to Page | 67

physicalstores.

Page | 68

3.3 Scope of the Study and Methodology

3.3.1 Scope of the study At any given time there are millions of people online and each of them is a potential customer for a company providing online sales. Due to the rapid development of the technologies surrounding the Internet, a company that is interested in selling products from its web site will constantly has to search for an edge in the fierce competition. Since there are so many potential consumers, it is of the out most importance to be able to understand what the consumer wants and needs. The importance of analyzing and identifying factors that influence the consumer when he or she decides to purchase on the Internet is vital. Since the Internet is a new medium for there have been new demand set By the consumer. That is why it is crucial for the online retailers to know what influences the online consumer. Analyzing consumer behavior is

not

a new phenomenon.

The renowned

marketing expert Philip Kotler has published several works on the topic of consumer behavior theories. These theories have been used for many years not only to understand the consumer, but also create a marketing strategy that will attract the consumer efficiently Hence, understanding and identifying the consumer is closely related to the directions a company will take with their marketing strategy. These theories can also be applied to identify the online consumer and to create certain consumer segments. However, some distinctions must still be made when considering traditional consumer behavior and online consumer behavior .

Since online retailing is a new retailing medium and online consumer Page | 69

behavior is diverse from traditional consumer behavior , one must identify what influences the online consumer. Analyzing the process that the online consumer goes through when deciding and making a purchase over the Internet, shows some factors that consumers consider these factors need to be identified and taken into account by online retailers in order to satisfy consumer demands and compete in the online market.

Page | 70

3.3.2 Research Methodology

Data for this study was collected by means of a Survey conducted in Lovely Professional University. The sample size

was 100. .The

Questionnaire (shown in Annexure) was used Mainly to test the model proposed for Attitude towards online shopping. The type of research was both exploratory as well as Descriptive. Likert five point scales ranging from Strongly Agree to strongly disagree was used as a basis of Questions. We took around eleven different factors by studying the existing models of consumer

attitudes that play

an

important role in online purchase, and then proposed a model leading to online shopping. This model was then tested in our research by the mode of factor analysis in SPSS.

3.3.3Research Strategy When collecting data to approach the purpose of a research there are two ways in which the data can be collected. In order to acquire a General knowledge about the topic, secondary data is primarily used and is one of the ways by which data can be collected. The second way to collect data is the primary data collection.

Conducted , secondary data is not sufficient enough and needs to be completed with primary data which is collected by the research .

Page | 71

3.3.4Descriptive Research Method We will conduct our research in order to collect primary data and reach the objective of the Dissertation. We will also be discussing which different types of Methodologies that were used. Since our research is of descriptive character our primary intention was to collect secondary data and analyze it. By doing so we found the factors Price, Trust and Convenience. We then collected

primary data through

a survey . The main

purpose of the survey was to collect data about Online Consumer Behavior

and the

significance of

the established factors , Price,

Trust, and Convenience In order to be able to find and establish

Online Consumer

Segments,

Consumer

Traits and

Online Behavior had to be identified . The segments were used in order to further identify what impact the factors Price, Trust , and Convenience have on Online Consumer Segments.

3 .4 Sample Design Page | 72

The factors that we intended to examine can be applied to and investigated at any population that uses the Internet and buys online products Online.

Since there are time and

resource restraints,

a

specific Population had to be identified in order to generalize and create relevant segments . We decided that the sample size should contain over 100 respondents and we collected answers from 100 respondents . Convenience sampling involves using samples that are the easiest to Obtain and is continued until the sampling size that is need is reached .

I will attempt to collect as many respondents as possible but since we will be studying students we assume that there will be little variation in the population making it more approved to generalize the response rates. The sampling method for students took also place on a Convenience basis since the students that agree to answer the questionnaire are those that were chosen

Type of Research :- Descriptive Research. Sample Size :- 100

Page | 73

Page | 74

CHAPTER4

Page | 75

Page | 76

DATA ANALYSIS

Page | 77

DATA ANALYSIS

Q1. TO KNOW THE AGE OF THE REPONDENTS?

AGE

20-30

30-40

40-50

50 AB

Figure 1 Page | 78

INTERPRETATION

The above diagram shows us the percentage in the age of respondents. As shows that from age 20-30 the number of respondents are31 % and from age of 30 -40 it is 48 % and from 40 -50 it is 14% and above 50 is 7% this is the above data which is shown by the this pie chart

Page | 79

Q2 TO KNOW THE GENDER OF THE RESPONDENTS?

GENDER

MALE

FEMALE

Figure 2

INTERPRETATION

This graph itself is showing more percentage of males rather than females, the percentage of male respondents is 86% and percentage of female respondents is only 14%.

Page | 80

Q3 TO KNOW THE OCCUPATION OF THE RESPONDENTS?

.

OCCUPATION STUDENT PROFESSIONAL GOVT.EMPLOYEE SELF EMPLOYED OTHER

Figure 3

INTERPRETATION

This graph help us to know the occupation of the respondents, this is to know that which segment of people are buying more products on the internet whether they are the segment of students of government employees or professional , the above graph shows that the segment of the students i.e. 39% of the students are using internet and use to buy online products.

Page | 81

Q4. TO KNOW THE MONTHLY INCOME OF THE REPONDENTS?

MONTHLY INCOME

 LESS THAN 10000  10000-20000  20000-30000  30000-40000  40000-50000  ABOVE 50000

Figure 4

INTERPRETATION

This above graph shows the percentage of monthly income of the different respondents, and it show that less than 10 000 income respondents have buyed more online products because most of them are students and they use to buy music Cds, gadgets, laptops .

Page | 82

Q5 TO KNOW WHETHER RESPONDENTS HAVE THEIR OWN INTERNET

CONNECTION

YES 62 NO 38

Figure 5

INTERPRETATION

This graph show us the percentage of respondents who have their own internet connections, its shows that 62% of respondents have their own internet connections and 38% people don’t have their internet connection.

Page | 83

Q6 DO YOU FEEL THAT ONLINE SHOPPING IS BETTER THAN SHOPPING AT PHYSICAL STORE ?

YES 11 NO 46 CAN'TSAY 38

Figure 6

After analyzing the above graph shows that the people are in favors of that online shopping is better than physical store, The percentage of people who says online shopping is better is 46% and the people who says it not good is 38 %. Still the percentage of people who says yes is more than other who say s no.

Page | 84

Q7 WHICH OF THE FOLLOWING STORES HAVE YOU VISITED

 E-BAY

- 35

 YAHOOSHOPPING- 40  AMAZON - 16  BEST BUY  OTHER

Figure 7

INTERPRETATION

This graph shows that 35% people use to visited e-bay for online shopping,40 % use to go at amazon.com because % of people who buys books is more than any other products so people mostly visits amazon.com, 16 % people do at yahoo shopping and for other people use to visit at Best Buy and others.

Page | 85

Q8-WHAT FACTORS HELP YOU TO DECIDE WHICH SITE TO USE FOR ONLINE SHOPPING?  SEARCH ENGINE  PERSONAL RECOMMENDATION  SPECIAL OFFERS ON SITES  ONLINE ADVERTISING  TV ADVERTISING  OTHERS

Figure 8

INTERPRETATION

This diagram shows us what affects people to buy products on internet and it shows that 32% people came to know about shopping sites through online advertisements. And they attracted towards it and start getting products from there. And 20% people decision is affected by special offers by the offers and the discounts given by the sites.

Page | 86

Q9 HOW YOU MAKE YOUR PAYMETS ON THE INTERNET

 CREDIT CARD/DEBIT CARD  BANK TRANFER  PAYPAL  ANY OTHER

Figure 9

INTERPRETATION

This diagram shows that mostly people uses credit card to pay their payments 78% people use to pay by credit/debit card and 5% through bank transfer and 15% through pay pal and 2 from PayPal.

Page | 87

Q10 HAVE YOU FACE

ANY PROB LEMS WHILE

SHOPPING ONLINE

YES -- 48 NO --- 28 CAN,T

SAY

--

14

This graph shows that whether people faces any problem while doing online shopping or not and the result shows that 48% people says that they have faced problem while buying online and 28% people says t

Page | 88

CHAPTER-5

Page | 89

Summary

Page | 90

5.1 SUMMARY The three segments that were found show a significant difference in the primary factor of concern. The general distribution showed that the factor price was the primary factor for the entire population sample, and

that

second

factor

was

trust

was

closely

followed

by

convenience. When we segmenting the respondents through the different variables we found that segment one were mainly trust oriented and the respondents had a high positive attitude toward s purchasing books online. Other segment was mainly price and convenience oriented therefore took the most consideration to the opinions and experiences of the Reference groups. As they low disposable income and were somewhat convenience oriented when acquiring information about low prices, we chose to label them price easers. We found that most of the time youngster who are from the age of 20-25 shops a lot on the net rather

than other age limits. People used to do online

shopping because of its convenience rather than its pricing, But the main thing which is very common in the most of the people about online shopping is its risk of privacy i.e. hacking of account number getting passwords and all.

Page | 91

Conclusion

Page | 92

5.2 CONCLUSION

Increased Internet penetration, a hassle free shopping environment and high levels of Net savings see more and more Indians shopping online. But at the same time the companies need to reduce the risks related to consumer incompetence by tactics such as making purchase websites easier to navigate, and introducing Internet kiosk, computers and other aids in stores. The goal is not to convert all shoppers to online purchasing, but to show them its an option. In addition to above, efforts need to be taken to educate the online buyers on the steps that need to be undertaken while making an online purchase. Moreover, the feedback of an online buyer should be captured to identify flaws in service delivery. This can be done through online communities and blogs that serve as advertising and marketing tools and a source of feedback for enterprises. I found that it is a challenge for E-marketers to convert low frequency online buyers into regular buyers through successful website design and by addressing concerns about reliable performance. Thus, the online retailing raises more issues than the benefits it currently offers. The quality of products offered online and procedures for service delivery are yet to be standardized. Till the same is done, the buyer is at a higher risk of frauds.

Page | 93

Limitations

Page | 94

Limitations of the Study Limitation of the study is the selection of the existing studies. Owing to time limitation, I only searched a few number of journals. This may leave some other prominent empirical studies out. In addition, owing to the multidisciplinary nature of online shopping, it would be very interesting to compare IS literature to other disciplines that study online shopping attitudes and behavior. Indian E-Comm. Report Finds Heavy Spenders Driving Sales -- By Devin Comiskey

August 16, 2007

A Survey by Indian research organization Juxtconsult found that more and more Indian Internet users are opening their wallets online. While

such

hurdles

as

limited

broadband access

and

security

concerns remain, the report finds there are currently more than 10 million

shoppers online in India. While current trends point to

increased e-commerce growth in India, the online marketplace in the country of more than 1 billion people is still relatively small. Juxtconsult's survey found that 40 percent of all urban Internet users

buy online, while 42 percent of the sales originate through just five percent of consumers. The survey was conducted in April 2007 and sampled more than 30,000 users.

Page | 95

"This section of buyers spends 5,000 rupees or more per month on the net," states the report. "It is interesting to note that two out of every three heavy spenders are also 'netholics, ' those who are on the net for more than three hours per day...Of all those who buy online, only 25 percent are spending more than 1,000 rupees per month while the (remaining) 75 percent bill less than 1,000

rupees per

month." (1,000 Indian rupees is currently equal to approximately $2 3 US.)

The report also found that buying and search patterns among Indians differ between genders. "While 43 percent of male users buy online, only 31 percent of urban female users are consumers as well. Women tend to search more. Defying their more common attitude towards shopping, women are more guarded when it comes to the online market," says Juxtcon sult. "Depending on the product type, nine percent to 25 percent are buying online, whereas 33 to 47 percent are sear ching the net for product information," it says.

Security Fears Persist

Juxtconsult says the motivation for Indian users to make purchases online varies, but users fear compromised personal information is still a great risk when it comes to e-commerce. "The single biggest motivation for buying online for net u sers is saving time. Thirty-two percent of them look to shop online with this purpose. Convenience of shopping '24x7' and home delivery are other major incentives," says the report. "However, the concern of possible misuse of credit card or personal information is extremely significant among online buyers, with almost 55 percent of them voicing their concern. Clearly, tackling and Page | 96

countering the issue of online safety figures as an imminent challenge for net marketers."

The products that are purchased most online in India, according to Juxtconsult, are books and CDs - making up 25 percent of all online purchases.

"Ironically,

computer

hardware and

software,

despite

having the home advantage are among one of the least bought products online, with only 13 percent buying them, " says the report. "In sum, the online market in India is blossoming but is yet to take off in a considerable way . The Internet is still being used more for searching than buying products and services. Though a noticeable proportion of net users are also net consumers, essentially, at present only a small tribe among them is driving online shopping momentum," says Juxtconsult.

LATEST

A new trend in this space is that of Meta search engines. Ixigo and Ezeego are two players in this space. A Meta search engine searches all the online travel sites (including the airlines sites as well) and displays the best deals for the user.

Travel websites, such as Make My Trip India Pvt. Ltd and Yatra Online Pvt. Ltd, are battling to win over India’s Rs16,00 0 cores ($ 400 million) religious travel market

Opportunity in Online Travel Industry: $2 billion

Online travel company Make MyTrip (MMT) has recorded sales of Rs. 1000 crore for the Page | 97

financial year ending March 2008 , as per a release.

Barriers to the Growth of the Market :

Consumer Bias The customer is not sure of the quality of the product unless it is delivered to him and post-delivery of the product, it is sometimes a lengthy process to get a faulty or the unsuitable product changed . Thus, unless the deliverables are as per the customers expectations, it is hard to in use more credibility in the e-Tailing market.

Mounting Competitive Pressures

To attract customers, the competing online players are adopting all means to provide products and services at the lowest prices. This has resulted in making the consumers choice-spoilt, who in turn surf various websites to spot the lowest price for the product. Thus, although the number of transactions is increasing, the value of the products sold is continuously falling owning to high competition and leaner margins.

Seasonality

E-Commerce Market is faced by seasonal fluctuations. As told by an Page | 98

Industry player, August to February is the peak seasons for sale, while March to July is the dry seasons for sale.. During the peak season, occasions that drive the sales are Diwali, Rakhi, Valentine s Day, New Year, Christmas, Mother„ s Day, Friendship Day etc. are. On these occasions younger generations prefers buying and sending gifts online.

Credibility in Payment System

Online frauds and breach are the biggest barriers to online sales. As a result, prospective buyers prefer staying away from revealing their credit card and bank details.

Untimely Delivery of Products

It might take a few minutes to search, book and pay for products and services online, but the delivery of the product may take unreasonable time.

Page | 99

]

Recommendation

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Recommendations As we came to know after researching on this topic we recommend that, the online sellers have to make their payment transparent, and as people are coming on their sites and they are buying their products , so retailers have to give more discounts to their customers so that they can visit again and again to their site , and it also helps to make people more aware about the low rick shopping of the net, and one more thing is that there should be transaction of money is very slow they have to make it fast so that customer dont have to face much problem to pay for the product, if customer is going to face some problem he is not going to visit our site and buy product .

Following implications should be followed

 Discount prices  A transfer and reliable retailer  Fast transactions  Focus on customer satisfaction Page | 101

CHAPTER-6

Page | 102

REFRENCES http://analog ik.com/article_analysis_of_ consumer_behaviour_online.asp [27 april 2011 ]

http://www. essays.se/essay/e1fb0c636 f/ [13april 2011]

http://www.tealeaf.com/Harris/[12april]

http://inderscience.metapress.com/app/home/contibution.asp?referrer=pare nt&backto=issue,2,6;journal,15,40;linkingpublicationresults,1:110844,1 [11april 2 011]

http://www.inderscience.

com/sear

ch/index.php?action=record&rec_id=32383&prevQuery=&ps=10&m=or1 m[12 may 2011]

(International Journal of Business In novatio n and Resear ch 2010 - Vo l. 4, No.3 pp. 195 - 209)

http://www.lotsofessays. com/viewpaper/1693412.html [11april 2011]

http://www.inderscience.com/search/index.php?mainAction=search&actio n=record&rec_id=11032&prevQuery=&ps=10&m=or[22 april [11april 2011]

( International Journal of Electronic Marketing an d Retailing 2006 Page | 103

Vol. 1, No.2 pp. 169 - 182)

http://www.inderscience.com/search/index.php?mainAction=search&actio n=record&rec_id=11032&prevQuery=&ps=10&m=or[2 may 2011]

(International Journal of Electronic Marketing and Retailing 2006 - Vol. 1 , No.2 pp. 169 – 182)

http://www.inderscience.com/search/index.php?mainAction=search&actio n=record&r ec_id=10096&pr evQuery=&ps=10&m=or [8 may 2010 ] (International Journal of Electronic Marketing and Retailing 2006 - Vol. 1 No.1 pp. 67 - 82) (International Journal of Internet Marketing and Advertising 200 8 – Vol. 4, No.4 pp. 302 - 327) [1 may 2010]

http://www.inderscience.com/search/index.php?mainAction=search&actio n=record&rec_id=27851&pr evQuery=&ps=10&m=or [2 may 2010 ]

(International Journal of Electronic Finance 200 9 - Vo l. 3, No .3

pp.

284 - 2 96 )

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(International Journal of Electronic Marketing and Retailing 2007 - Vol. 1 , No.4 pp. 322 - 338)

http://www.cyberpsychology.eu/view.php?cisloclanku=2009111002&artic le=6#authors [22 may 2010] http://www.innovations-report.com/html/reports/social_sciences/r eportPage | 104

5469 4.html 22april 2010]

QUESTIONNAIRE

Page | 105

QUESTIONNAIRE

Q1. Name ___________________

Q2. Age 1) 15-20

2) 20-25

3) 25-30

4) 30 above

Q3. Gender 1) Male

2) Female

Q4. Address 1) Rural

2) Urban

Q5. What is your occupation? a) Student

b) Professional

d) Self Employed

c) Govt.employed

e) Other

Q6. What is your monthly income?

a) Less than 10000

b) 10 000 to 20000

d) 30000 to 40000

e) More than 40000

c) 20000 to 30000 Page | 106

Q7. Do you have you r own intern et connection?

a) Yes

b) No

Q8. How frequently do you purchase online? a) Once a week

b) More than once a week

c) once a month

d) more than once in a month

Q9. What motivates to buy pro ducts online?

a) Easy payment

b) No hidden cost

d) Wide range of products

c) No travel to shop

e) other [Please specify] _____________

Q10. What products you buy on internet?

a) Books

b) Mu sic CDs c) T-shirt

e) laptop

f) Other [specify] ___________

d) Mobile

Q11. Do you feel that online shopping is better than shopping at physical brick & mortar store? a) Yes

b) No

c) Can’t say

Page | 107

Q12.Which of the following stores have you ever visited for shopping online?

a) e-bay

b) Yahoo shopping

d) Best buy

e) Other [please specify]

c) Amazon

Q13. What factors help you to decide which site to use for online shopping? a) Search engine on sites

b) Personal recommendation d) Online advertising

c) Special offers e) TV advertising

f) other

Q14.How do you make your payments on internet? a) Credit card/Debit card

b) Bank transfer

c) PayPal

d) any other___

Page | 108