“CONSUMER BEHAVIOR on online shoping

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RESEARCH PROJECTREPORT

ON

CONSUMER BEHAVIOR

IN ONLINE SHOPPING

A report submitted to Gautam Buddh Technical Universityfor thePartial 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

MASTERS OF BUSINESS ADMINISTRATION

Session (2009-11)

UNDER THE GUIDENCE OF

MISS. MEENAKSHI SRIVASTAV

(FACULTY)

Submitted by

SAURABH GUPTAMBA (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, Lucknowis 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 19

1.3.4 Few Facts about Online Shopping 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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Page | 9CHAPTER-1


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INTRODU

CTION TO

SUBJECT


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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


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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 to 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


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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-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 with the development of E-retailing, researchers

continue to explain E-consumers behavior from different

perspectives. Many of their 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. Manyexperts are optimistic about the prospect of online business. In addition to


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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-to-

consumer 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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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 consumersattitudes 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 e-

commerce 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


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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 created a paradigm shift of the

traditional way people shop. 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.


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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! Its very surprising that Bangalore being the IT Hub of

the country contributes a very meager 6%. They have also predicted that e-

commerce 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.


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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


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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 IndiaWhy 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 bargain-

hunting, 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 dont

get any real value or incentive. Also they are wary about fraud, delivery and

customer service and their fears are not imaginary.


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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 ofcheating 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. Myexperience 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


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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 giftitems 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


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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 ofhttp://www.admanya.comIndias leading C2Cportal. Admanya is free and it completely depends on consumer participation

for its content. Join Admanya and be an empowered consumeryou 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 Indias online buying is crossing the overall global averages.
http://www.admanya.com/http://www.admanya.com/http://www.admanya.com/http://www.admanya.com/


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1.3.3 Few Factors That Boost Online Shopping in

India

Rapid growth of cybercafs 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.


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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 e-

commerce 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


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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 shouldnot be a problem. All purchases are made through safeand

secure servers.

It's safe to say SSL is extremely sophisticated software andsafe.

Always know where your cards are and keep them in a safe

place.

The phenomenal success of online retailers such as Amazonand 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 isshipping 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 Europeare 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 ones personal choice and preferences. Below

mentioned is the number of items in percent unit that buyers love to buy via

theonline mode of shopping.

CDs/tapes/records (17%) Videos/DVDs (17%) Event tickets (20%) Printer supplies (12%) Books (30%)


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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


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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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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 its not showing any sign of slowing. Thesub-continents economy is weathering the economic storm well and thanks to a

strong export market its 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 Indias Internet users connect via mobile phones. There

are nearly 800 Million wireless subscribers compared to only 11 million wired

users, this significantly boosts Indias online population.

But Indias users may also be holding growth back. Few Indians have credit

cards, which makes it difficult for online shopping to function. That said,

advertisers dont have this problem and services such as YepMe, Indias 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 itsNational

Broadband Strategy that will see fibre optic cables laid across the nation.
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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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Review of

Literature


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2.1 Review of literature

Petrovic Dejan (2006) in his study on Analysis of consumer

behavior online 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 .


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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


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

their study 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


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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.


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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


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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 e-

commerce. 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


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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


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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 textiles 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.


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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,


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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


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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


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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


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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 e-

retailing 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 net-

savvy 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


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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 e-

tailor 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 e-

store


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CHAPTER-


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3


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NEED

OBJECTIV

ES SCOPE


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&

METHODO

LOGY


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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 regardto online Shopping

To examine whether customers prefer online shopping to


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physicalstores.


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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 thedirections 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


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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.


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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 ourresearch 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


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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


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CHAPTER-

4


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DATA

ANALYSIS


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DATA ANALYSIS

Q1. TO KNOW THE AGE OF THE REPONDENTS?

Figure 1

AGE

20-30

30-40

40-50

50 AB


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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


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Q2 TO KNOW THE GENDER OF THE RESPONDENTS?

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%.

GENDER

MALE FEMALE


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Q3 TO KNOW THE OCCUPATION OF THE RESPONDENTS?

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.

.

OCCUPATION

STUDENT

PROFESSIONAL

GOVT.EMPLOYEE

SELF EMPLOYED

OTHER


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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 .


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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.


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Q7 WHICH OF THE FOLLOWING STORES HAVE YOU VISITED

E-BAY - 35YAHOOSHOPPING- 40AMAZON - 16BEST BUYOTHER

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.


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Q8-WHAT FACTORS HELP YOU TO DECIDE WHICH SITE TO USE FOR ONLINE

SHOPPING?

SEARCH ENGINEPERSONAL RECOMMENDATIONSPECIAL OFFERS ON SITESONLINE ADVERTISINGTV ADVERTISINGOTHERS

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.


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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.


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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


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CHAPTER-5


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Summary


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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.


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Conclusion


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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.


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Limitations


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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 thecountry 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.


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"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


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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 Indias 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


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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


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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.


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]

Recommendation


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CHAPTER-6


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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/search/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 -


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5469 4.html 22april 2010]

QUESTIONNAIRE


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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 c) Govt.employed

d) Self Employed e) Other

Q6. What is your monthly income?

a) Less than 10000 b) 10 000 to 20000 c) 20000 to 30000

d) 30000 to 40000 e) More than 40000


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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 th