BEHAVIOUR OF ONLINE AND NON - ONLINE SHOPPERS TABLE OF CONTENTS 1. Introduction.....3 2. Online shoppers: products and services...4 3.

Reasons for not shopping online: non-online shoppers...4 4. Demographic profile: Online shoppers..5 5. Demographic profile: Non-online shoppers.....16 6. Psychographic profiles: Online shoppers.....25 7. Psychographic profiles: Non-online shoppers... .31 8. Promotional strategy: Online shoppers....37 9. Recommendations based on the study..39 10. References 41 11. List of Figures Demographic profile of Online shoppers.5 Figure.1 Products and services mostly shopped by online shoppers...4 Figure.2 Influence of Age and Gender on online shopping5 Figure.3 Influence of Marital status and Household size on online shopping.....9 Figure.4 Influence of Education and Occupation on online shopping..10 Figure.5 Influence of Designation and Income on online shopping .12 Figure.6 Effect of Computer ownership and Years of using Internet on online shopping.14 Figure.7 Influence of internet usage on online shopping ..15 Demographic profile of Non-Online shoppers..16 Figure.8 Influence of Age and Gender on online shopping..17 Figure.9 Influence of Marital status and Household size on online shopping..19 Figure.10 Influence of Education and Occupation on online shopping20 Figure.11 Influence of Designation on online shopping....20 Figure.12 Influence of Income on online shopping...21 Figure.13 Influence of Computer ownership and Years of internet usage on online shopping23 Figure.14 Influence of Internet usage and number of online Non-shoppers24 Psychographic profile of Online shoppers....24 1

BEHAVIOUR OF ONLINE AND NON - ONLINE SHOPPERS Figure.15 Influence of Risk and Innovation on online shopping..25 Figure.16 Influence of Brand and Price consciousness on online shopping.27 Figure.17 Influence of Convenience and Variety seeking on online shopping.29 Figure.18 Effect of Impulse buying on online shopping...31 Psychographic profile of Online Non-shoppers32 Figure.19 Influence of Risk and Innovation on online shopping..32 Figure.20 Influence of Brand and Price consciousness on online shopping.33 Figure.21 Effect of Convenience and Variety seeking on online shopping..35 Figure.22 Effect of Impulse buying on online shopping...36 Promotional Strategy for Online shoppers...37 Figure.23 Influence of Advertisement and Attitude on online shopping.39 List of Annexure 1. Attached copies of questionnaires filled by online shoppers 2. Attached copies of questionnaires filled by online non-shoppers Introduction A random sample was undertaken to ascertain the behavior of online and non-online shoppers. The sampling method applied guarantees equal chance of selection for each observation in a population. The assumption is that the population is relatively homogeneous with respect to the random variable under study, Trevor Wegner (1999, pg 172). This research combines aspects of both formative and summative evaluation (Fox, Bartholomae, and Lee 2005) and relies on data from quantitative and qualitative methods. Quantitative data from General Questionnaire section create the bones of the story to be told from participants' background and experiences in this research, while qualitative data from Specific Questionnaire section help to put flesh on the bones. Hypothesis testing and estimation are the two key elements of inferential statistics that will be applied in analyzing sample data. Questionnaires were randomly distributed to prospective respondents in Harare, Zimbabwe where many people of diverse demographic features are domicile. We recognize that the sample population may not be representative of the Online shopping population since we confined our study to an urban 2

BEHAVIOUR OF ONLINE AND NON - ONLINE SHOPPERS set up, geographical location. We are cognizant of the technology gap between rural and urban areas with more information, communication and technology (ICT) infrastructure confined to the major cities and towns. Despite this issue, we maintain that the sample is of interest from a research perspective as results will be salvaged by fair proportions of rural to urban migration, urbanization. The study will hence produce useful information that may reflect the behavior of both online and non-online shoppers. 1. Products and services shopped by Online shoppers:Product 1 2 3 4 5 6 7 8 9 10 Clothing Cars and car parts Furniture Cosmetics Groceries Books CDs Music, Movies Electrical gadgets Medicines-Drugs Cell phones Service Hotel bookings News-business, sport Tutorials Music downloads Banking-wire transfers E-books Entertainment-golf, chess Online phone book Utility bill payments Health and Beauty therapy

Figure1. Products and services shopped by On-line shoppers 2. Common reasons given by non-online shoppers for not shopping online: No access to internet Perception of high costs associated with online shopping Risk aversion emanating from fear of Cyber fraud/terrorism Prospective customers lack awareness on availability of online shopping facility Intermittent internet connectivity challenges faced by internet service providers discourage online shopping

BEHAVIOUR OF ONLINE AND NON - ONLINE SHOPPERS Failure by local banks to provide VISA and Master cards making online shopping not practical. Inadequate Information Communication and Technology (ICT) infrastructure suppressing online shopping desire 3. DEMOGRAPHIC PROFILE ONLINE SHOPPERS Demographics exude the different characteristics of shoppers on the market producing essential information for formulation of an appropriate marketing mix. The target market which comprises of homogenous clusters of similar tastes and preferences will undoubtedly influence the type of strategy to implement. Marketing objectives of profit maximization, customer satisfaction and increased market share will be achieved once we understand customer expectations and manage to deliver goods and services. Responses from the sample were recorded accordingly on Questionnaires before any data analysis and derivation of information. The following are the noted mutually exclusive demographic profiles of Online and Non-Online shoppers:(a) Online Shoppers
Influence Of Gender On On-line Shopping Influence Of Age On On-line Shopping 13 12 11 10 9 8 7 6 5 4 3 2 1 0

11

Number Of People

3 5%

6 5%

1 0
23-32 33-39 39-44 45-54 Male Female

Age (years)

Figure 2: Influence of Age and Gender on On-line shopping

BEHAVIOUR OF ONLINE AND NON - ONLINE SHOPPERS Analysis: A sample of 34 people who were interviewed indicated that 65% (11out of 17) of the seventeen online shoppers were Generation Y. Generation Y is a grouping of people of ages that vary from 14-32 years, represented by 11 of respondents interviewed as indicated in Fig 2 above. It is composed of people who are innovative, celebrate diversity, rewrite the rules, assume technology and reflect optimism. The grouping is also more-skilled and multi-tasking, agile in making decisions, evaluating risks and managing dilemmas, flexible and persistent in the face of change, highly skilled in social networking and team activities. Spiro, (2006) referred to this grouping as comprised of optimists, educated, having collaborative abilities, open-mindedness drive .The group was referred to as "the first generation of digital natives" by Sarbu (2008) . Studies by (Club It&C, Anon., 2008a) revealed that there was a heavy influence and rising interest by Generation Y towards new services and technologies, and greater media flexibility. On the other hand Generation X (33-44years) is pragmatic, individualistic and rejects rules. They represent 29% (5 out of 17) of the seventeen online shoppers. Baby boomers (45-54years) constitute 6% (1 out of 17) of the seventeen online shoppers. They are idealistic, conform to rules and consider diversity as a cause. The work of Grewal, Levy (2010,p123) concluded that there are five distinct age groups in a population vis--vis Tweens, Generation Y, Generation X, Baby boomers and Seniors. Conclusion: The survey under review showed that Generation Y, Generation X and Baby Boomers actively take part in online shopping. Age is a very important determinant of online shopping as perceptions, tastes and preferences are intrinsic at particular stages of human growth and development. Jasper and Lan (1992) found that as age increases, tendency to catalog shop also increases. Generation Y is composed of people who are technology savvy and risk takers. As marketers redefine their marketing mix and strategies, emphasis should be particularly focused on this grouping since they rewrite the rules, assume technology and reflect optimism. Results obtained reflect that basically online shoppers are younger in conformity with research work of (Zhang, Prybutok, and Strutton 2007). Allred, Smith, and Swinyard 2006 also confided that online shoppers are younger, possess greater wealth, are better educated, and spend considerably more time on the Internet. 5

BEHAVIOUR OF ONLINE AND NON - ONLINE SHOPPERS Since societies are digitized with constant quantum leaps in technology, there is need to create awareness among all age groups on the advantages of technology initiatives. Gamble et al., 2007 concluded that organizations should adapt their strategies accordingly and acknowledge their online consumers' constantly shifting needs and expectations. Baby boomers and Seniors should also be targeted in marketing efforts although younger cohorts are the "computer generations" and will be more likely to purchase online than older consumers. Online shoppers are younger, possess greater wealth, are better educated, and spend considerably more time on the Internet (Allred, Smith, and Swinyard 2006; Swinyard and Smith 2003). A recent study by Nicoleta-Dorina Racolta-Paina (2010, pg. 85) indicated the products that Generation Y are associated with since their childhood. The products include computers, laptops, digital photo & video cameras, portable MP3 players, cell phones, iPhones or other gadgets which are part of their everyday life. Consumer buying behavior is not only determined by age but other factors should also be considered as outlined by Bellman et al. (1999) research. The research indicated that demographic variables such as income and education besides age also have a modest impact on the decision of whether to buy online (Jayawardhena et al., 2003, p. 124) Gender Analysis: As illustrated in Fig 2 above Male represents 65% while female constitute 35% of the total online population. Cultural perceptions and tendencies which had men dominating in most decision making, taking more part in formal employment , pursuing with education and earning more salary than female; all result in less women online shoppers. The drive by the government (Zimbabwe) to ensure gender equality and employment creation for women seeks to redress the anomaly. A Ministry to that effect as well as other initiatives is aimed at reducing the imbalances between men and women. More preference and opportunities are extending to women endeavoring to capture a secluded lucrative market for consumer, health, beauty, fashion and style industries. Gender has an influence on online shopping as recent studies have indicated that male are frequent shoppers than female, Ernst and Young ('Global Online Retailing' 2000) .The 6

BEHAVIOUR OF ONLINE AND NON - ONLINE SHOPPERS evidence shows that frequent online shoppers (five or more times) tend to be male, while infrequent shoppers (less than five times) tend to be female. Respondents answered the questionnaire basing on the frequency or rate at which they do online shopping. Conclusion: Capturing the minds and influencing the behavior of women is essential in extending a market base. Women are presumed repeat buyers exuding loyalty as reflected through their behavior in buying cosmetics and fashionable clothing. There is need for marketers to develop their market through reaching out to new markets with new products by exploitation of the untamed resources. The nature of the product, lead time and technology conversant can have psychographic effects in stimulating online purchasing behavior. Luxury goods that consumers can buy after a longer time frame of familiarization with marketing mix offering can be compared with consumer goods. Consumer goods are basically required instantly to satisfy needs hence intolerant to time delays in making purchasing decisions. Men therefore spend considerable time in shopping online for cars, electrical appliances and cell phones. Women on the other hand mainly search for cosmetics and clothing which are now readily available in shops hence less time in online shopping. Lead time refers to the time taken for delivery of products once payment has been made. The higher the lead time the more dissatisfied the consumer and the lesser the desire for online shopping. Psychographic factors also assist in the decision making and purchasing function as commitment, patience and endurance are important. Male prove to be more patient with stretched lead time on purchased capital goods than women. The percentage of online shopping is thus higher than females as a result of the tolerance on lead time by men. Some women have a slight tendency of avoiding technical tasks which inevitably prejudice them from benefiting from the fortunes of Cyber digitization. Whilst intentions to purchase online for male consumers have been found to be significantly greater than for female consumers (Zhang, Prybutok, and Strutton 2007), there is need to encourage women to intensify their efforts. These results provide a reason for retailers to target advertising at websites heavily patronized by women. 7

BEHAVIOUR OF ONLINE AND NON - ONLINE SHOPPERS Marital Status and Household size Marital status analysis: A significant number of people interviewed were married
Influence of Household size on Online shopping 12

Marital Status Single

Frequency 9 8 17

Percentage 53 47 100

10

Married
Number of persons

Divorced Widow/r Living together Total

0 1 2_3 4_5 6_7 7> Household size (Number)

Figure 3: Influence of Marital status and Household size on On-line shopping constituting 53% of the total population as highlighted in Fig 3 above. Marital status is important in online shopping since it is part of the demand for goods and services. There is a positive correlation between marital status and household size. Since the number of people per household determines the bargaining power and appetite for market deliverables, there is need to seriously consider the role marital status plays in online shopping. In Zimbabwe due to the adverse economic environment, households shrink to sizes of 4 at most. High costs of living, unemployment, increasing poverty levels, high infant mortality rates, scourge of HIV/AIDS pandemic and unstable political environment all contributes to a smaller family size. Household size analysis: The diagram above also illustrates that on average a Zimbabwean family that has capacity to shop online is composed of 2 to 3 members. People have adopted birth control methods to reduce birth rate hence a smaller family size. There has been a growing desire to pursue with Education in line with the government initiative of improving literacy rates coupled with a personal desire to secure 8

BEHAVIOUR OF ONLINE AND NON - ONLINE SHOPPERS better jobs. Products with a bias towards promoting education such as textbooks, computers, online tuition thus have a ready market. Education and Occupation Occupation
Influence of Education on O nline shopping 7 6 5

No Persons 1 5 1 2 1 1 1 2 2 17

of % 5 29 6 12 6 6 6 6 12 12 100

Agriculture Finance Tourism Health care Engineering Retail Distribution Services

Ord Level Certificate Qualification First Degree

No. of persons

4 3 2 1 0

Manufacturing 1

Other Total

Figure 4: Influence of Education and Occupation on On-line shopping Education analysis: Ordinary level is considered the basic education qualification in Zimbabwe based on five passes at C or better grading in any Arts and Humanities, Human and Social Sciences and Commercial subjects. The duration of studies is mainly four years before attaining the qualification .Advanced level which is equivalent to Matriculation level, is a platform slightly above Ordinary level. The duration of studies is a two year period with areas of specialization in Arts, Sciences or Commercial subjects. Figure 4 above shows that the majority (71%) of the respondents had at least a Diploma or better indicating that more educated people appreciate online shopping better. Conclusion: As people progress in personal growth and development through education, they have more affinity to technology applying theory to practical situations. There are a growing number of people who make wire transfers to foreign institutions for tuition 9

BEHAVIOUR OF ONLINE AND NON - ONLINE SHOPPERS purposes. Many Generation Y students are taking studies through ACCA, CIMA, CFA, IMM and other graduate and postgraduate foreign universities. Universities in UK, Malaysia, Singapore and South Africa are providing online tuition services serving the Zimbabwean youths. Respondents to the questionnaire indicated that internet shoppers are more educated (Zhang, Prybutok, and Strutton 2007). Occupation analysis: Economy is a broad spectrum of various sectors with the main objective of ensuring growth and development of the whole nation. All sectors of the economy are represented as illustrated in Fig 4 above indicating that online shopping is across the board and not confined to one sector. The Financial sector makes 29% while Health care and Services make 12% use of online services respectively. The nature of the industry necessitates use of online services as Finance sector oils the whole online shopping by providing the platform for use of credit and master cards. Industries in Retail, Distribution and Tourism rely on the robust framework established by the Finance department under the auspices of Information technology sector. Online marketing strategies should be tailor made to suit specific needs of the respective sector. Conclusion: While both private and industrial buyers are responsible for the global volume of e-business, these groups differ markedly from each other. Industrial e-buyers tend to be more informed, more structured in their decision making processes, more cost conscious, and more responsive to company norms concerning Internet usage (Kennedy & Deeter-Schmelz, 2001). Private users, on the other hand, tend to be influenced by a narrower set of specific factors, such as return policy (Wood, 2001) and other general behavioral variables. Designation and Income Designation analysis: The diagram below illustrates that of the seventeen online respondents, 71% are non-managerial staff whilst management constitute 29%. As we move the corporate ladder, the ratio of employees at managerial level declines whilst the more the income received hence more disposable income. The marginal propensity to consume tend to rise with availability of more income The clerical staff are expected to 10

BEHAVIOUR OF ONLINE AND NON - ONLINE SHOPPERS be more price conscious as they receive lesser salaries than their superiors. The pattern also has effect in online shopping where we expect to find more participation of price Designation Income
Influence of Income on Online shopping

Senior Management (1)

6 No of People 5

Middle Management (3)

4

Supervisor (3)

Officer (3)

Officer (3)
1

Clerk (3)
0 <2700 2701- 6001- 12001- 18000< 6000 12000 18000 Annual Income ($)

Figure 5: Influence of Designation and Income on On-line shopping sensitive clerical staff in the electronic field. A strong perception of affordability stimulates the online mode of shopping by the clerical staff. Managerial staff may tend to be ignorant of price changes hence inelasticity to variation of prices on traditional shopping mode. Conclusion: One may expect managers to be better shoppers online than the clericals given that they have more access to the internet. In some organizations as we discovered, Internet is a privilege available only to Managers of higher ranks. In our research we discovered that 65% of respondents use computers owned by their employers. If as highlighted earlier, the employer sanctions internet to only higher managerial ranks that constitute a minority then the number of online shoppers will be reduced. The data gathered on internet usage per week also clearly demonstrates that respondents had fewer online surfing hours per week. More time is dedicated in performing business related 11

BEHAVIOUR OF ONLINE AND NON - ONLINE SHOPPERS searches depriving users the opportunity to fully benefit from online services. We also noted that respondents were averse of internet cafs which they considered much expensive as web browsers take long in connecting hence higher charges. Management have more time to engage in online shopping at work places as they delegate most of the work to subordinates. Since management constitutes only 29% of the work force subsequently we expect the volume of online shopping to slacken as number of users deplete. Income analysis: Income plays a crucial role in online shopping as more real disposable income means more online shopping. Gross Domestic Product Per Capita income is also very important as it determines standard of living and capability to shop by an individual. Figure 5 above indicates that 59% of the respondents earn an average annual income of US$9,300 which converts to a monthly figure of US$775. The grouping has favorable disposable per capita income to utilize in online shopping. As researched by Zhang, Prybutok, and Strutton (2007), thus we can deduce that internet shoppers have higher incomes. Conclusion: In the study by Daran (1987), in-home shoppers tend to have higher levels of income, are above average in education, and are younger than in-store shoppers Computer Ownership and Years of using internet Computer ownership analysis: A significant number of online shoppers (64%) make use of computers owned by their employers whilst 36% owns computers as reflected in Figure 6 below. Computer ownership is important in influencing online shopping as people make shopping at different convenient time. Employer owned computers are mainly used for business operations during working hours limiting the time for personal online shopping. As indicated later on there is a correlation between computer ownership and hours of internet use per week. Where employer owned computers are used more hours of internet surfing are committed to business whereas fewer hours are for private shopping.

12

BEHAVIOUR OF ONLINE AND NON - ONLINE SHOPPERS Conclusion: Since most people make use of employer owned computers marketers should target company websites with banners of their products and services. The users spend most of their time at work hence less time for personal online shopping. Consumers mostly make use of employer owned machines for internet as they consider it cheaper than Internet Cafes. The intranet or extranet system at workplaces should fully

Influence of Computer ownership on Online shopping

Years Internet

of

Using No Persons 1 2 0 3 11 17

of %

0% 0% 36%

<1year 1-2years 2-3years 3-4years 4years< Total

6 12 0 17 65 100

64%

Owned Employer's Internet Caf Rented

Figure 6: Effect of Computer ownership and Years of using Internet on online shopping Years of using Internet analysis: The table above indicates that 65% of respondents have more than four years experience in using the internet. In terms of ability to use the internet in online shopping, most respondents expressed satisfaction. However, inherent risk and costs associated with online shopping inhibit the full utilization of the service. There is need to perfect on security issues and improve on connectivity as consumers desire the best service. A significant number of online shoppers saw low costs and substantial benefits associated with e-shopping. They were experienced Internet users

13

BEHAVIOUR OF ONLINE AND NON - ONLINE SHOPPERS who valued online information searching, Yehoshua Liebermann: (Dec 2009. pg. 316, 16 pgs). Conclusion: Zhang, Prybutok, and Strutton (2007) concluded that internet shoppers display higher levels of internet and e-mail usage. We noted that more ISPs are entering the lucrative market competing extensively in offering the best service at affordable prices to customers. Internet surfing charges have effectively diminished as the competition intensifies. Improvements in technology have also seen internet applying not only to computers and laptops but to cell phones. The trend of committing more time to online shopping is fast approaching as ISP strive to provide tailor made ICT oriented products and service. Consumers are set to benefit immensely from removal of Customs duty on all imported IT hardware and software material. The number of online users will increase as ISPs also extend their services. If consumers own the computer resource and have internet access, then the environment will be more conducive to online shopping. Internet Usage per week (hrs) and Number of Online shoppers

Influence of Internet usage on Online shopping 10 9 8

Number of Online Shoppers

Number of persons

7 6 5 4 3 2 1 0 <7 7_14 14_21 21< Time of internet use per week (hrs) Private Business

17

Yes

No

Figure 7: Influence of Internet usage on online shopping

14

BEHAVIOUR OF ONLINE AND NON - ONLINE SHOPPERS Internet usage analysis: As highlighted in Figure 7 above 82% of respondents spend 714 hours surfing for goods and services on the internet. Costs associated with surfing on the net hinder online shopping as reflected by the less hours of private use of the internet as time of use increases over the week. As hours of internet surfing increases more emphasis will be on business related work depriving time of private use. Conclusion: In order to increase rate of internet use and online shopping, there is need for marketers to effectively create more awareness on the benefits of using online shopping. Whilst more hours may reflect more online shopping, one should understand that decision making can be effected even where Number of online shoppers analysis: There is equal number of online and traditional shoppers owing to various reasons such as, costs, connectivity, risks and ignorance on the part of consumers. (b) Non-Online Shoppers Non-online or traditional shoppers do not fully make use of the internet when shopping. They may be aware of its existence but are reluctant of utilizing the facility in their consumption pattern. When talking about consumer behavior, there are several factors that clearly influence it, such as: social (given by culture, subculture, social class, reference groups, family and roles and status), personal (given by and age and life-cycle stage, occupation, lifestyle, personality, self-concept and economic circumstances), psychological (influenced by motivation, perception, learning and beliefs and attitudes) and situational (Drummond et al., 2008). Age and Gender Age analysis: Generation Y age group constitute 82% of non online shoppers as indicated in Fig 8 below. Although the grouping is endowed with technology acumen, they expressed reservations on online shopping. There were mixed feelings with regard the use of internet by non-online shoppers. Most respondents indicated that since they did not own computers they resort to traditional shopping. Some of the respondents professed ignorance as they acknowledge availability of the facility but lacked interest in utilizing the avenue. Failure by retailers to effectively create awareness on availability of their 15

BEHAVIOUR OF ONLINE AND NON - ONLINE SHOPPERS

Influe nce of Age on O n-line shopping 16 14 12

Influence Of Gender on On-line Shopping

Number of People

10 8 6 4 2 0 <23 23-32 33-39 39-44 45-54 Age (years)

5 3% 4 7%
Male Female

Figure 8: Influence of Age and Gender on On-line shopping products on the internet was also outlined as one reason for not shopping online. Seniors who are traditional shoppers constitute 6% mainly due to fewer numbers in that group as life expectance declines to mid forties. Poor health provisions and effects of HIV/AIDS scourge have adversely distorted this market segment. Conclusion: There is need to reach out to traditional shoppers selling the benefits of online shopping whilst adding value through various respective market deliverables. A Pew Internet &American Life Project "found that those segments remaining disproportionately unconnected to the Internet included the following: the elderly, rural residents and the poor " (The Pew Internet &American Life Project, 2002-2005, cited in Reisenwitz et al., 2007) Gender analysis: As indicated in Fig 8 above, respondents interviewed comprised 53% men and 47% women who were non-online shoppers. Ancient societal values regarded men as bread winners of households thus the higher number of male non-online shoppers. Most men expressed displeasure in costs associated with online shopping indicating that their disposable income was inadequate to support the method of shopping. Time and 16

BEHAVIOUR OF ONLINE AND NON - ONLINE SHOPPERS financial constraints were the main reason for shunning the system. Modernization brought awareness and the active participation of women pressure groups redefining the role of women in society as equals with men. Women are now encouraged to take up male dominated jobs. Men have thus shown that due to various instant demands, they had no time and courtesy to engage in online shopping. Conclusion: Gender is important in both online and traditional shopping methods as taste and preferences vary respectively. Consideration of the factor is essential in any market planning as it provides a clue to the expected demand for goods and services. Marital Status and Household size Marital status analysis: The ratio of single online non-shoppers to married nonshoppers is 3:2 as portrayed in Fig 9 below. Single persons generally have fewer responsibilities than the married hence have more disposable income to afford even luxuries apart from necessities. Most of the single respondents come from small households where because of the convenient size has more disposable income for shopping. Household size analysis: The household size of non-online shoppers is similar to that of online shoppers as most respondents have small family units of three members at most as shown in Fig 9 below owing to reasons already mentioned. It therefore indicates that there are other factors to consider apart from household size in understanding the behavior of consumer shopping. Factors such as disposable income, perceptions and education should also be considered respectively. Conclusion: The provision of security assurance to risk-averse respondents may convert traditional to online shopping behavior.

17

BEHAVIOUR OF ONLINE AND NON - ONLINE SHOPPERS

Marital Status
Influence of Household size on Online shopping 12 11 10 9 8 7 6 5 4 3 2 1 0

Frequency 10 7 17

% 59 41 100

Single Married Divorced Widow/r Living together

Number of persons

2_3

4_5

6_7

7>

Household s ize (Number)

Total

Figure 9: Influence of Marital status and Household size on On-line shopping Education and Occupation Education analysis: Fig 10 below shows that the majority of traditional shoppers are better educated just like online shoppers. It is important to note that other factors such as perceptions and attitudes apart from education should be determined in studying the behavior of online consumers. Occupation analysis: The finance sector has the highest number of online non-shoppers (Figure 10) due to its size on the whole market followed by Retail, Services and Health care industries. Unavailability of credit cards and lack of confidence in electronic shopping are among some of the reasons cited by non-online shoppers. Conclusion: There is need to educate people on the advantages of online shopping as that area has not been given enough coverage. Consumers are better educated in other faculties of learning but needs more clarion assistance in accepting internet as a convenient method of shopping. 18

BEHAVIOUR OF ONLINE AND NON - ONLINE SHOPPERS

7
Influence of Education on Online shopping

Occupation Agriculture Finance Tourism Health care Engineering Retail Service Other
Certi fi ca te Fi rs t Degree

No of Persons 0 7 0 2 1 4 3 0 17

% 0 41 0 12 6 0 24 17 0 100

6 5

No. of persons

4 3 2 1 0 Ord Level

Manufacturing 0

Total

Qua l i fi ca ti on

Figure 10: Influence of Education and Occupation on On-line shopping Designation

Senior Management (1)

Middle Management (5)

Supervisor (2)

Officer (2)

Officer (2)

Clerk (3)

Figure 11: Influence of Designation on On-line shopping 19

BEHAVIOUR OF ONLINE AND NON - ONLINE SHOPPERS

Analysis: Middle management constitute 29% of traditional online shoppers as shown in Fig 11.The grouping has less time for online shopping as they engage in the day to day running of the organization. Conclusion: Designation at work plays a role in stimulating demand and participation in online shopping. The Board of directors formulates strategy which management implements as operational workforce execute duty. At corporate level executives and management are very important in internet shopping as they have sole decision making. Expectations are that as we ride the corporate ladder, management should be more involved with internet shopping. However it is important to note that time constraints and perceived costs hinder online shopping. NB: - One person is self employed while the other is unemployed. Income
Influence of Income on Online shopping
7 6 No of People

Number of people

5 4 3 2 1 0 <2700 2701-6 000 6001- 12000 12001- 18000 18000<

Annual Income ($)

Figure 12: Influence of Income on On-line shopping Analysis: The graph above (Fig 12) outlines that of all the non-online shoppers respondents, 53% earn low income whilst 35% and 12% earn average and high income respectively. Carr and Schuetz (2001) theorize that lower-income families' nonuse of traditional financial services occurs for complex reasons including: unfamiliarity with 20

BEHAVIOUR OF ONLINE AND NON - ONLINE SHOPPERS banking and savings services, not writing enough checks to justify an account, and distrust of mainstream financial services providers. There is a tendency for low income earners to have relatively high debt payment to income ratios which relatively more likely to make late bill payments and, as a result, pay more for credit (Aizcorbe et al. 2003 cited in Hogarth and Anguelov 2004) Conclusion: Overall, mainstream financial institutions' service of low-income communities continues to lag; however, some financial institutions and other purveyors of financial products have begun to recognize the potential for capturing these relatively untapped markets with new products. Financial institutions are investigating whether the lower cost of service that technology enables makes it worth the institutions' effort to expend the resources necessary to capture these markets. Banks are now exploring the potential of information technology (IT) banking tools to serve low-income customers and to attract the unbanked, (Alderslade 2005).As noted the reduced availability of financial literacy training for low income persons represents a barrier to achieving financial literacy. Low incomes also limit the demand for such services among this group even when available. Therefore, it may be necessary to subsidize financial literacy programs for low-income persons to bring their level of literacy to an appropriate level. Such programs may have large returns because previous research has shown that financial literacy is an important determinant of economic well-being (Bernheim 1998; Jacob, Hudson, and Bush 2000) Computer Ownership and Years of using Internet Computer ownership analysis: Non-online shoppers who uses their employers computers constitute 41%, whilst use of owned, internet caf and rented constitute 35%, 18% and 6% respectively (Fig 13 below). Conclusion: Unavailability of internet access by respondents who use employer owned computers is a major drawback in online shopping. The costs related to renting computers were also considered high by most respondents. 21

BEHAVIOUR OF ONLINE AND NON - ONLINE SHOPPERS Years of using internet analysis: Non-online shoppers with more than four years of using internet constitute 71% indicating that most people are aware of availability of the service. The need to provide a secure internet system is essential in capturing the large grouping of non shoppers to actively participate in online shopping. However, some respondents (17%) were ignorant of the available facility as reflected by their short period engagement of less than one year. Conclusion: Bellman et al. (1999) found that the three strongest predictors of Internet shopping were looking for product information, number of months of online experience, and number of daily emails received. These variables are somewhat reflective of the ability to navigate the Internet (i.e., "Internet functional"). On the other hand, the strongest predictors of shopping online according to Lynch et al. (2001) were site quality trust in the vendor, and positive affect toward the site. Years using Internet
18% 35%

Influence of Computer ownership on Online 6% shopping

of No of Persons

<1year 1-2years 2-3years 3-4years

3 1 0 1 12 15

17 6 0 6 71 100

41% Owned Employer's Internet Caf Rented

4years< Total

Figure 13: Influence of Computer ownership and Years of internet usage on online shopping

22

BEHAVIOUR OF ONLINE AND NON - ONLINE SHOPPERS

Internet usage per week analysis: As indicated in Fig 14 below, non-online shoppers who use the internet for at least seven hours per week for private online shopping constitute 71%. When the number of hours of internet use per week increases, the business use mode rises as shown by the 18% respondents that use the internet for business for more than twenty one hours per week. Company resources are utilized with strict measures such as use of internet for business related use only depriving most users more time to perform online shopping. Internet usage per week (hrs) and Number of Online Non-shoppers Conclusion: Loyal internet shoppers are expected to have more hours of accessing the internet per week. Kwak et al. (2002) identified other predictors of Internet shopping, including amount of onsite product information, Internet involvement, and product opinion leadership. These variables reflect a combination of Internet functionality and affective experience. Number of online non-shoppers analysis: The number of non-online shoppers and shoppers is equal due to various reasons mentioned in the foregoing.
Influence of Internet usage on Online shopping 14 12
Number of persons

Number of Online Shoppers

10 8 6 4 2

50% 50%

Yes

No

<7 7_14 14_21 21< Time of i nternet use per week Private (hrs) Business

Figure 14: Influence of Internet usage and Number of on online non-shoppers 23

BEHAVIOUR OF ONLINE AND NON - ONLINE SHOPPERS 4. PSYCHOGRAPHIC PROFILES-SPECIFIC QUESTIONNAIRE Attitude is "a psychological tendency that is expressed by evaluating a particular entity with some degree of favor or disfavor" (Eagly and Chaiken, 1993, p. 1). Attitude has a strong influence on consumers' buying intention (e.g. Ryan, 1982). Applied to the present study, attitude toward online purchasing is considered to be a function of the consumer's beliefs about an e-store's characteristics and the degree of subjective importance a consumer attaches to those attributes (Fishbein and Ajzen, 1975) 4. (a) Online Shoppers The behavior of online shoppers can be studied better through understanding their psychographic tendencies. Responses from the questionnaire were collated, averaged and utilized in analyzing the data. Ratings were subsequently allocated on a scale of response of 1-5 vis a vis; Strongly agree -1; Agree -2; Moderate -3; Disagree -4 and Strongly disagree -5. We deduced the following from our research finding: Risk taking tendency and Innovativeness Diagrams:Influence of Risk on Online shopping 11
10 9 8
No. of persons

Innovativeness influence on Online shopping

7
Av. Response

Average Response

No. of persons

7 6 5 4 3 2 1 Strongly agree Moderate Response Strongly disagree

0
S.Agree

Mod Response

S.Disagree

Figure 15: Influence of Risk and Innovation on online shopping 24

BEHAVIOUR OF ONLINE AND NON - ONLINE SHOPPERS

Risk taking tendency analysis: Shopping on the Internet has been associated with carrying risk. In particular, privacy-related concerns, identity and credit card theft, and lack of order fulfillment (or order errors) have all been noted concerns (Dubelaar, Jevons, and Parker 2003). Ease of product returns also troubles some shoppers. All of these issues increase risk, and subsequently influence the decision to shop online. Perception risk which is prevalent among online shoppers was defined as the consumer's perception of the uncertainty and concomitant adverse consequences of buying a product or service (Dowling and Staelin, 1994). Liebermann and Stashevsky (2002) produced a map of perceived risks that create a barrier to potential Internet users, which of course could inhibit e-commerce as well. The leading perceived risks involve the loss of credit card and other personal information.Bauer (1960) in his seminal work on risk-taking set forth the idea that consumer behavior involves risk in the sense that any action of a consumer will produce consequences that he or she views with some degree of uncertainty. In the psychology literature, perceived risk has been described as consisting of a set of possibly interrelated components: financial, performance, physical, psychological, social, and time and convenience, yielding a separate measure of overall perceived risk (Jacoby and Kaplan, 1972). Conclusion: The majority of online shoppers (88%) (indicated in Fig 15) interviewed were strongly risk averse and considered safety a priority. Campbell and Goodstein (2001) point out that there are various types of perceived risk (financial, performance, social, psychological and physical) and that often times one or more of these sources may drive consumers' overall perceptions of risk. The importance of each type of risk will vary significantly across product/ service categories and national cultures. As with different cultures ascribing different meanings to the same occurrence or event this will influence how consumers perceive risk. Nakata and Sivakumar, (2001) concluded that this leads to significant differences in perceived consumer risk of purchasing products/services online across national cultures. Innovativeness analysis: In the context of online consumer behavior, Goldsmith (2000) and Limayem et al. (2000) found that personal innovativeness is a personality trait that 25

BEHAVIOUR OF ONLINE AND NON - ONLINE SHOPPERS explains consumer online buying intention. Innovativeness is the relative willingness of a person to try a new product or service (Goldsmith and Hofacker 1991). Following the rationale of Donthu and Garcia (1999), innovativeness was a key attribute of the online shopper segments of actualizers and experiences (SRI International 1995). Actualizers as a consumer segment are active, very discriminating in their purchases, and also rather adventurous in their activities. Experiencers are innovative and modern, seek stimulation, and are also considered trend setting or fashionable (SRI International 1995). Donthu and Garcia (1999) found empirically that online shoppers were more innovative than no shoppers. Another study by Goldsmith and Flynn (2004) looked at a specific type of online purchasing (clothing) and found that innovativeness was a significant predictor of online consumption Conclusion: Online shoppers interviewed comprise of both Actualisers and Experiencers who exude innovative shopping characteristics. We therefore predict that Internet shoppers report more innovative behavior than non-shoppers. Brand and Price consciousness diagrams:-

Influence of Brand on Online shopping

7
Av. Response

Influence of Price on Online shopping

Av. Response

No. of persons

No. of persons
S.Agree Mod Response S.Disagree

0
S.Agree

Mod Response

S.Disagree

Figure 16: Influence of Brand and Price on online shopping 26

BEHAVIOUR OF ONLINE AND NON - ONLINE SHOPPERS

Brand consciousness analysis: Brand consciousness is a shopping orientation, which is characterized by the degree to which a consumer is oriented toward buying well-known branded products (Shim and Gehrt 19%; Sproles and Kendall 1986). In-flight shoppers have also been shown to have higher levels of brand consciousness (Huang and Kuai 2006). Donthu and Garcia (1999) suggest that the major forces on the Internet who are selling products to consumers are well-established and well-known companies. These companies tend to have very high brand recognition. Research suggests that high brand recognition will lower the risk to the consumer when purchasing online (Tan 1999). As a result, individuals will feel more reassured purchasing online if they are buying from an entity with a name they know and trust. Internet shoppers will be more brand conscious than non-shoppers. Price consciousness analysis: The Internet facilitates price comparison, and Internet shoppers often look for multiple alternatives when shopping due to the lower search costs of shopping on the Internet (Donthu and Garcia 1999). Prices are therefore more transparent in that consumers can find out the variety of prices in a market with considerable ease (Laudon and Traver 2008). One benefit of reduced search costs and price transparency is that consumers can easily find out the lowest prices available for a specific product service on the Internet. Our conceptualization of a price-conscious shopper refers to this ability of the Internet shopper to look for and compare multiple alternatives due to reduced search costs on the Internet with a view of finding the lowest available price. The Internet shopper therefore spends less time and money locating the desired product at the desired price. Given their product search capabilities, online shoppers are considered to be well-informed consumers (Hoffman and Novak 1997). Smith (2002) notes that consumers readily utilize shop bots that can search the Internet for the best price and value. Even though this suggests that online shoppers are more likely to be price conscious, Donthu and Garcia (1999) did not find this to be the case in their study. They show that many online buyers are less price-conscious, as they are more concerned with finding products that satisfy their needs rather than looking for bargains. Another research effort found that the segment of online shoppers who are focused on 27

BEHAVIOUR OF ONLINE AND NON - ONLINE SHOPPERS utilitarian values such as convenience and time-savings tend to be less price sensitive (Swaminathan, Lepkowska-White, and Rao 2003). Hence, we propose the following: Conclusion: We discovered that online Internet shoppers will be more price conscious than non-shoppers. According to Berry (1969) price is a key attribute for customers when forming perceptions of retailers Convenience and Variety seeking:Convenience seeking analysis: Similar to other direct shopping methods, using the Internet to shop is associated with convenience. In-home shoppers enjoy multiple forms of convenience according to Darian (1987). They include less shopping time, flexibility with regard to when they shop, less physical effort, and easier response to advertising or promotions. Similarly, Eastlick and Feinberg's (1999) study of catalog shoppers found

11

Influence of Convenience Seeking on Online shopping

Av. Response

Influence of Variety on Online shopping

10
Av. Response

No. of persons

No. of persons
S.Agree Mod Response S.Disagree

0
S.Agree

Mod Response

S.Disagree

Figure 17: Influence of Convenience and Variety seeking on online shopping 28

BEHAVIOUR OF ONLINE AND NON - ONLINE SHOPPERS that convenience was based on consumers finding what they want in a short time period, with less effort, and shopping at any time of day. Girard, Korgaonkar, and Silverblatt (2003) found that convenience was one of the highest attractions to shopping online. Rohm and Swaminathan (2004) found convenience to be a centerpiece when assessing shopper motivations. Therefore, we propose: Conclusion: Online shoppers who constitute 53% of the total respondents seek more convenience than no shoppers. Consumers are more affected by their perceived duration of download waiting time than by the actual waiting time (Dellaert and Kahn, 1999). Variety seeking analysis: Variety seeking has been defined as the alternation among products or brands over a series of choices (Kahn and Isen 1993). Some consumers who are variety seekers alternate between brands and products even though their most preferred selection is available (Ratner and Kahn 2002; Ratner, Kahn, and Kahneman 1999). Given the ease of Internet search versus traditional search, it follows that online shoppers would search more extensively than their offline counterparts. Such search would lend itself to variety-seeking behavior. In their effort to form a typology of the Internet shopper, Rohm and Swaminathan (2004) characterized four types of Internet shoppers, one of which they identified as variety seekers. They found that the variety seeker is substantially more motivated by variety seeking across retail alternatives and product types and brands than any other shopping type. Conclusion: Donthu and Garcia (1999) found that, in general, online shoppers had higher levels of variety seeking than nonshoppers. This is consistent with other tendencies of the online shopper, including their recreational nature and their risk aversion. The majority of online shoppers (88%) as indicated in the diagram above will be more variety seekers than non-shoppers. Impulsive Analysis: The consumer behavior literature refers to impulse buying as extraordinary, emotion-saturated buying that takes place largely without regard to financial or other consequences (Wood 2005). Hoffman and Novak (1997) found that heavy Internet users, 29

BEHAVIOUR OF ONLINE AND NON - ONLINE SHOPPERS including shoppers, get into "a flow" on the Web. They become very involved with the process and it becomes synonymous to a recreational experience (Donthu and Garcia 1999). Recreational shoppers are less traditional, tend to be more innovative, are information seekers, and are prone to making more impulsive purchases (Bellenger and Korgaonkar 1980). Similarly, Darian (1987) proposed that in-home shoppers were more impulsive. Donthu and Garcia (1999) found that online shoppers scored higher on measures of impulsiveness than did non-shoppers. Zhang, Prybutok, and Koh (2006) suggest that there exists a positive relationship between consumer impulsiveness and online purchasing behavior.

Conclusion: Although internet shoppers are expected to make higher levels of impulsiveness we discovered that 59% were against the practice. Factors to be considered include availability of disposable income, safety of the system and marketing strategies of retailers.
Influence of Impulse buying behaviour on Online shopping

No. of persons

Av. Response
S.Agree Agree Mod Response Disagree S.Disagree

Figure 18: Effect of Impulse buying on online shopping

30

BEHAVIOUR OF ONLINE AND NON - ONLINE SHOPPERS 4. (b) Non-Online Shoppers Risk taking tendency and Innovativeness diagrams:Risk taking tendency analysis: A significant number (94%) of traditional shoppers are risk averse as indicated in Fig 19 below. The risk can be categorized into time, social, physical, psychological and financial risk. Time/ convenience risk relates to the time spent for the purchase of a product and the time wasted in case of a poor product/service choice. Social risk reflects the disappointment in the individual by his friends in case of a poor product/service choice. Physical risk relates to the safety and health of the individual.
Influence of Risk on Online shopping
11 10 9 8
A verag e R es p ons e

Influence of Innovation on Online shopping

8 7

Av. Response

No. of persons

7 6 5 4 3 2 1 0 Strongly agree Moderate Response Strongly disagree

No. of persons

0
S.Agree

Mod

S.Disagree

Response

Figure 19: Influence of Risk and Innovation on online shopping Psychological risk reflects an individual's disappointment in him/herself in case of a poor product/service choice. Lastly, financial risk pertains to the loss of money in the case of a poor product/ service choice. Pavlou (2003) alludes to the "implicit uncertainty of the ecommerce environment. Consumers are thought to have "an inherent predisposition to 31

BEHAVIOUR OF ONLINE AND NON - ONLINE SHOPPERS avoid risk in purchasing situations" (Dowling, 1986). Other potential inhibitors (Bhatnagar, Misra, & Rao, 2000) include perceived cost of product category, expectations of functionality, limited or nonexistent return policies, and lack of physical contact with the item or salesperson. Various transaction costs (Kumar, Lang, & Peng, 2004/2005; Teo & Yu, 2005) are likely inhibitors as well. Conclusion: Chaudhuri (1998) found that positive and negative emotional factors contribute as mediators of product class effects on perceived risk. Because luxuries have large emotional underpinnings, luxuries and necessities function quite differently with regard to perceived risk. Additionally, intangibility has been shown to be positively associated with perceived risk (Laroche, Bergeron and Goutaland, 2003) Innovativeness: Non-shoppers are also innovative as reflected in Fig 19 where 53% of respondents expressed a keen interest to try new products and services. Brand and Price consciousness diagrams:-

Influence of Brand on Online shopping

9
Av. Response

Influence of Price on Online shopping

6

Av. Response

No. of persons

No. of persons

0
S.Agree

S.Agree

Mod Response

S.Disagree

Mod Response

S.Disagree

Figure 20: Influence of Brand and Price on online shopping 32

BEHAVIOUR OF ONLINE AND NON - ONLINE SHOPPERS

Brand consciousness analysis: It has been widely suggested that key success factors for online companies are based on developing brand awareness, building customer loyalty and reducing operating costs ([75] Porter, 2001; [105] Zeithaml et al. 2002). More specifically, the findings showed that high quality and satisfaction result in revisiting the web site. This means that not only the identified e-service quality drivers built loyalty but that they may convert traditional shoppers to electronic shoppers, thus allowing for potential operational cost reductions. In fact, in their search of cost reduction and efficiency most brick-and-mortar companies seek to shift transactions online. Brand selection might well be more likely to affect customers' buying decisions and subsequent e-store patronage than merchandise variety (Degeratu et al., 2000). Conclusion: Online non-shoppers did not resemble more value in brands as reflected in the Fig 19 above. There is need to consider other issues such as price, variety and convenience. Donthu and Garcia (1999) did not find brands to be a significant factor. Likewise, Seo (2005) finds that Internet purchasers tend to have high levels of brand involvement compared to nonshoppers and high levels of brand consciousness. Price consciousness analysis: Figure 20 illustrates that there are mixed responses by non-shoppers with regard value of price on goods and service. Respondents who reflect negative sentiments on price (47%) were not in agreement that they buy cheap and items on sale only. The number of respondents who are price conscious is 35% as the shoppers check prices before purchasing and save on bargains. Consumers are attracted to technologies because of convenience, increasing ease of use, and, in some instances, cost savings (Anguelov et al. 2004). Jarvenpaa and Todd (1996) argue that price, quality, and product type are the three key elements in shaping consumers' perceptions. Conclusion: The works of Liao and Cheung (2001) and Jarvenpaa and Todd (1996) postulated that price has a significant impact on online purchasing intention and online purchasing adoption, respectively. Traditional shoppers also consider seriously the importance of price on goods and services. Convenience and Variety seeking:33

BEHAVIOUR OF ONLINE AND NON - ONLINE SHOPPERS

Convenience seeking analysis: Convenience is measured by effort savings (e.g. ease of a locating a product in a store) and location convenience (e.g. ease of locating a store and finding a parking space) (Lindquist, 1974). In online shopping, convenience includes timely delivery, ease of ordering, and product display (Lohse and Spiller, 1998). Similarly, Bitner (1990) advocates the effects of time, access to information, money constraints, and lack of credible alternatives, which may affect service loyalty. Lohse and Spiller (1998) discerned that several factors can be subsumed under the convenience attribute of online shopping. Among these attributes, they found that product display has a significant impact on site visits and sales.

Convenience as a determinant of Online shopping

6

Influence of V ariety on Online shopping

Av. Response
4 No. of persons

Av. Response

No. of persons

0
S.Agree

S.Agree

Mod Response

S.Disagree

Mod Response

S.Disagree

Figure 21: Effect of Convenience and Variety on online shopping Conclusion: Convenience is considered important by non-shoppers as reflected in the diagram above. Cronin and Taylor (1992) suggest that convenience, good value for money, and availability might enhance customer satisfaction and subsequently reduce switching behavior. Athanassopoulos et al. (2001) substantiated this basic suggestion 34

BEHAVIOUR OF ONLINE AND NON - ONLINE SHOPPERS with empirical results, which indicated that customer dissatisfaction leads to switching behavior. Variety seeking analysis: A significant (82%) number of traditional shoppers consider variety as important in their purchasing behavior. However, Lohse and Spiller (1998) dispute the importance of merchandise variety in e-tailing. In particular, their work showed that the number of products increases e-store traffic, but it does not affect sales. Apparently, whether or not an e-tailer has a specific product a customer is looking for is more important than simply having a large variety of items (Lohse and Spiller, 1998) Impulsive

Influence of Impulse buying behaviour on Online shopping

Av. Response

No. of persons

0
S.Agree

Mod Response

S.Disagree

Figure 22: Effect of Impulse buying on online shopping Analysis: There is a strong dissonance with regard impulse buying by traditional shoppers. The majority of them cited that they were price conscious, favored planned purchases and relied on making shopping lists before purchases. Donthu and Garcia (1999) alluded to the fact that Internet shoppers were also more likely to be impulsive 35

BEHAVIOUR OF ONLINE AND NON - ONLINE SHOPPERS than non-shoppers. Moe and Fader (2000) suggest that both planned and unplanned visit/purchase will affect future purchase decisions. Conclusion: Purchase intentions refer to the consumer's willingness to buy more through the internet. In general, a large number of classical researches have substantiated the relationship between service quality, satisfaction and service switching. For example, Cronin and Taylor (1992) suggest that convenience, good value for money, and product availability may enhance customer satisfaction and subsequently decrease switching behavior.

5. Promotional strategy for online shoppers Direct Mail and E-Mail marketing campaigns: These should be focused at capturing the minds of prospective non users of products or promoting repeat purchase by regular customers. The main target should be Generation Y who are pragmatic, clever, socially and environmentally aware, and open to new experiences (Schiffman et al., 2008). Since they are risk takers, new products and services should be tailor made to suit their needs and wants. It is of an utmost importance that companies take them into consideration when they define the main traits (product/service, price, place, promotion and so on) of their offer. Moreover, they are believed to bring an essential contribution to the technological progress through their constant interest in new media, (Curus, 2008). Ducoffe found that Internet users have positive attitudes toward advertising and online advertising in particular as they described it as "informative" and "up to date." High usage interactive online gamers have positive attitudes toward both online advertising and the direct communications that lead them to those services (Jones 2007). Donthu and Garcia (1999) found that online shoppers had more positive attitudes toward direct marketing and advertising. Direct mail and e-mail will be more effective in an environment of robust network which ensure deliverables are accurately provided to the target market. Spiros et al postulated that marketers should carefully consider their web site's attributes. For example, if 36

BEHAVIOUR OF ONLINE AND NON - ONLINE SHOPPERS marketers want consumers to have a positive experience with their sites, they may want to adorn their sites with pleasant and enjoyable stimuli to make them attractive. In addition, they should make their sites easy-to-use and easy-to-navigate. Furthermore, marketers should place extra emphasis on providing fast, accurate, and uncluttered information through their web sites. Finally, marketers rather then designing static web sites, they should design sites that interact with the consumers and adjust to their needs. Direct mail, e-mailing, web-pages and online advertising promotions should target the segment. (Daran 1987) concluded that online shoppers tend to have more positive attitudes toward direct marketing and advertising as cyber-shopping provides opportunities to make more purchases. Donthu and Garcia (1999) found that online shoppers will have more positive attitudes toward shopping, advertising and direct marketing than non-shoppers. Special promotions, price incentives and exclusive offers: E-managers can induce consumers to visit their sites more often. This objective can be achieved by different types of actions. For example, e-consumers can receive price incentives, exclusive offers, special promotions, and product/service advantages. Spiros et al Word of Mouth (WOM) activities: Companies should reinforce WOM activities from satisfied customers. More specifically, companies could enhance its impact and effectiveness by facilitating or even rewarding such behavior. For instance, they can make available on their sites possibilities such as "tell a friend" e-mailing, "share your opinion" sections, "send a discount coupon to a friend" or "let a friend know about a special offer" actions, and "get a premium service for sending us a new customer". Spiros et al

37

BEHAVIOUR OF ONLINE AND NON - ONLINE SHOPPERS

Impact of Advertisements on Online shopping

7

Effect of Attitude on Online shopping

8 7

Av. Response
Av. Response

No. of persons

No. of persons

0
S.Agree

S.Agree

Mod Response

S.Disagree

Mod Response

S.Disagree

Figure 23: Influence of Advertisement and Attitude on online shopping It is important however important to note that 35% of online shoppers perceive advertisements as deceptive hence they do not pay attention to them. Andrews and Boyle, (2008, p. 67) concluded that media reports, particularly television, "have made a significant, negative impact on the interviewees' affective perceptions of the risk involved". Brackett and Carr (2001) found that web advertising is "irritating, annoying or insulting to peoples' intelligence." There is a correlation between attitude and online shopping as reflected by responses recorded from the online shoppers. Most respondents (76%) indicated that they enjoyed shopping which they regarded as fun. Attitudes toward shopping, direct marketing, and advertising are linked in the online world. Online shoppers, when in "the flow," traverse the Web seeking recreation and adventure (Hoffman and Novak 1997). To some, shopping is a recreational activity, and recreational shoppers tend to have more positive attitudes toward shopping (BeIlenger and Korgaonkar 1980). Donthu and Garcia (1999) found that online shoppers have more positive attitudes toward shopping, advertising and 38

BEHAVIOUR OF ONLINE AND NON - ONLINE SHOPPERS direct marketing. Swinyard and Smith (2003) found many consumers view online shopping to be more entertaining than offline shopping. Privacy of consumers is important in attracting and retaining online shoppers. Online shoppers indicated that they were more concerned with ethical issues vis--vis privacy, security, respect and responsibility. Privacy consists of "the rights of individuals and organizations to determine for themselves when, how, and to what extent information is to be transmitted by others" (Udo, 2001, p. 165). A significant 47% of the online respondents expressed strong reservations on phone solicitations and receipt of junk mail which they considered invasion of privacy and nuisance respectively.

5.

Major learning from the assignment

a) There is growing appetite for new products or services by Generation Y. Since customers need a wide range of unique products to suit their needs it is an obvious reflection of the vast diversity of needs, values and life styles of the 3rd Wave Society (Toffler, 1996, p. 159)". b) Customers have dynamic preference and taste which change with quantum leaps in technology. In response to these trends, companies need to globalize their e-business to generate increased business value because a global virtual presence can be more feasible and less expensive than a physical presence (Mahmood, Bagchi, and Ford 2004 c) Brand and Price consciousness is important in determining customer behaviour since it stimulates a desire to purchase a product. d) Customers are sensitive and delicate with regard the marketing mix (product, price, place, promotion). e) Most customers make a planned decision and avoid impulse behaviour in making purchases.

39

BEHAVIOUR OF ONLINE AND NON - ONLINE SHOPPERS

REFERENCE
1. Trevor Wegner, Applied Business Statistics.(1999) Juta & Co , Ltd 2. Fox, Jonathan, Bartholomae, Suzanne, and Jinkook Lee. 2005. Building the Case for Financial Education. Journal of Consumer Affairs, 39 (1): 195-214. 3. Nicoleta-Dorina Racolta-Paina, Theodora Alexandra Luca. Management & Marketing. Bucharest: 2010. Vol. 5, Iss. 2; pg. 85, 16 pgs 4. Sarbu, M. (2008), "Cum arata Generatia Y", Business Magazine, available at: http://www.businessmagazin.ro/opinii/cum-arata-generatia-y-2507667 (accessed December 2009) 5. Spiro, C. (2006), "Y Generation in the Workplace", Defence AT&L, pp. 16-19, available at:http://www.dau.mil/pubs/dam/11_12_2006/11_12_2006_spi_nd06.pdf (accessed December 2009) 6. Schiffman, L.G., Kanuk, L., Hansen, H. (2008), Consumer Behaviour: A European Outlook, Pearson Prentice Hall, London 7. Curus, C. (2008), "Invazia tinerilor nascuti in digital", Romania Libera, available at: http://www.romanialibera.ro/a123322/invazia-tinerilor-nascuti-in-digital.html (accessed December 2009) 8. Jayawardhena, C., Wright, L.T., Masterson, R. (2003), "An investigation of online consumer purchasing", Journal of Consumer Marketing, 6 (1), pp. 58-65 9. Gamble, P.R., Tapp, A., Marsella, A., Stone, M. (2007), Marketing Revolution. The Radical New Approach to Transforming the Business, the Brand & the Bottom Line, Kogan Page 10. Donthu, N., & Garcia, A. (1999). The Internet shopper. Journal of Advertising Research, 39(3), 52-58. 11. Yehoshua Liebermann, Shmuel Stashevsky. Canadian Journal of Administrative Sciences. Halifax: Dec 2009. Vol. 26, Iss. 4; pg. 316, 16 pgs 12. Bellman, S., Lohse, GL., & Johnson, E.J. (1999). Predictors of online buying behavior. Communications of the ACM, 42(12), 32-38. 13. Kwak, H., Fox, R.J., & Zinkhan, GM. (2002). What products can be successfully promoted and sold via the Internet. Journal of Advertising Research, 42(1), 23-38. 40

BEHAVIOUR OF ONLINE AND NON - ONLINE SHOPPERS 14. Brackett, L.K., & Carr Jr. B.N. (2001). Cyberspace advertising vs. other media: Consumer vs. mature student attitudes. Journal of Advertising Research, 41(5), 23-33. 15. Stigler, GJ. (1961). The economics of information. Journal of Political Economy, 49(3), 213-225. 16. Park, CW., Milberg, S., & Lawson, R. (1991). Evaluation of brand extension: The role of product similarity and brand concept consistency. Journal of Consumer Research, 18(2), 185-193. 17. Petty, R.E., Cacioppo, J.T., & Schaumann, D. (1983). Central and peripheral routes to advertising effectiveness: The moderating role of involvement. Journal of Consumer Research, 10, 135-146. 18. Korgaonkar, P., Silverblatt, R., & Girard, T. (2006). Online retailing, product classifications, and consumer preferences. Internet Research, 16(3), 267-288. 19. Doolin, B., Dillon, S., Thompson, F, & Corner, J.L. (2005). Perceived risk, the Internet shopping experience and online purchasing behavior: A New Zealand perspective. Journal of Global Information Management, 13(2), 66-88. 20. Koch, J.V., & Cebula, RJ. (2002). Price, quality, and service on the Internet: Sense and nonsense. Contemporary Economic Policy, 20(1), 25-37. 21. Liebermann, Y., & Stashevsky, S. (2002). Perceived risks as barriers to Internet and e-commerce usage. Qualitative Market Research: An International Journal, 5(4), 291-300. 22. Bhatnagar, A., Misra, S., & Rao, H.R. (2000). On risk, convenience, and Internet shopping behavior. Communications of the ACM, 43(11), 98-105. 23. Kumar, N., Lang, K.R., & Peng, Q. (2004/2005). Consumer search behavior in online shopping environments. EService Journal, 3(3), 87-104. 24. Pitkow, J.E., & Recker, M.M. (1994). Using the Web as a survey tool: Results from the second WWW user survey. GVU Technical Report: GVU-GIT-94-40. 25. Guard Privacy and Online Security (2005), Internet ID Theft Statistics Show How Online Identity Theft Works, available at: http://www.guard-privacy-and-onlinesecurity.com/internet-id-theft-statistics.html (accessed December 2009) 26. Toffler, A. (1996), Al Treilea Val, Antet XX Press, Bucharest 41

BEHAVIOUR OF ONLINE AND NON - ONLINE SHOPPERS 27. Allred, C.R., Smith, S.M., Swinyard, W.R. (2006), "E-shopping loves and fearful conservatives: a market segmentation analysis", Journal of Consumer Marketing, 34 (4/5), pp. 308-333 28. Andrews, L., Boyle, M.V. (2008), "Consumers' accounts of perceived risk online and the influence of communication sources", Journal of Consumer Marketing, 11 (1), pp. 59-75 29. Drummond, G., Ensor, J., Ashford, R. (2008), Strategic Marketing. Planning and Control, 3rd edition, Butterworth-Heinemann, Oxford 30. Sorce, P., Perotti, V., Widrick, S. (2005), "Attitude and age differences in online buying", Journal of Consumer Marketing, 33 (2), pp. 122-132 31. Udo, G.J. (2001), "Privacy and security concerns as major barriers for ecommerce: a survey study", Journal of Consumer Marketing, 9 (4), pp. 165-174 32. Bhattacherjee, A. (2001b). Understanding information systems continuance: An expectation confirmation model. MIS Quarterly, 25(3), 351-370. 33. Oliver, R.L. (1980). A cognitive model for the antecedents and consequences of satisfaction. Journal of Marketing Research, 17,460-469. 34. Chau, P.Y.K., Au, G., & Tam, K.Y. (2000). Impact of information presentation modes on online shopping: An empirical evaluation of a broadband interactive shopping service. Journal of Organizational Computing and Electronic Commerce, 10(1), 1-22. 35. Goldsmith, R.E. (2000). How innovativeness differentiates online buyers. Quarterly Journal of Electronic Commerce, 1(4), 323-333. 36. Jarvenpaa, S.L. & Todd, P.A. (1996). Consumer reactions to electronic shopping on the World Wide Web. International Journal of Electronic Commerce, 1(2), 5988. 37. Liao, Z. & Cheung, M. (2001). Internetbased e-shopping and consumer attitudes: An empirical study. Information & Management, 38(5), 299-306. 38. Janiszewski, C. (1998). The influence of display characteristics on visual exploratory search behavior. Journal of Consumer Research, 25(3), 290-301. 39. Moe, W.W. & Fader, RS. (2000). Which visits lead to purchase? Dynamic conversion behavior at e-commerce sites. University of Texas. 42

BEHAVIOUR OF ONLINE AND NON - ONLINE SHOPPERS 40. Donthu, Naveen, and Adriana Garcia (1999), "The Internet Shopper," Journal of Advertising Research, 39 (3), 52-58 41. Darian, Jean C. (1987), "In-Home Shopping: Are There Consumer Segments?" Journal of Retailing, 63 (2), 163-186. 42. Dubelaar, Chris, Colin Jevons, and Lukas Parker (2003), "Personal Information Privacy and Shopping Behavior on the Internet," Journal of Asia Pacific Marketing, 2 (1), 65-71. 43. Bellman, Steven, Gerald L. Lohse, and Eric J. Johnson (1999), "Predictors of Online Buying Behavior," Communications of the ACM, 42 (12), 32-38. 44. Bellenger, Danny, and Pradeep Korgaonkar (1980), "Profiling the Recreational Shopper," Journal of Retailing, 56 (4), 77-92. 45. Eastlick, Mary A., and Richard A. Feinberg (1999), "Shopping Motives for Mail Catalog Shopping," Journal of Business Research, 45 (3), 281-290. 46. Hoffman, Donna L., and Thomas P. Novak (1997), "A New Marketing Paradigm for Electronic Commerce," Information Society, 13 (January-March), 43-54. 47. Kahn, Barbara E., and Alice M. Isen (1993), "The Influence of Positive Affect on Variety-Seeking Among Safe, Enjoyable Products," Journal of Consumer Research, 20 (2), 257-270. 48. Goldsmith, Ronald E., and Lisa R. Flynn (2004), "Psychological and Behavioral Drivers of Online Clothing Purchase," Journal of Fashion Marketing and Management, 8 (1), 84-95. 49. _____, and Charles F. Hofacker (1991), "Measuring Consumer Innovativeness," Journal of the Academy of Marketing Science, 19 (3), 209-221. 50. Mahmood, M. Adam, Kallol Bagchi, and Timothy C. Ford (2004), "Online Shopping Behavior: Cross-Country Empirical Research," Ergonomics, 47 (5), 469-482. 51. Tan, Soo J. (1999), "Strategies for Reducing Consumers' Risk Aversion in Internet Shopping," Journal of Consumer Marketing, 16 (2), 163-180. 52. Laudon, Kenneth C, and Carol Guercio Traver (2008), E-Commerce: Business, Technology, Society, 4th ed., Upper Saddle River, NJ: Prentice Hall. 43

BEHAVIOUR OF ONLINE AND NON - ONLINE SHOPPERS 53. Yang, Chyan, and Chia-Chun Wu (2007), "Gender and Internet Consumers' Decision-Making," CyberPsychology St Behavior, 10 (1), 86-91. 54. Shim, Soyeon, and Kenneth C. Gehrt (1996), "Hispanic and Native American Adolescents: An Exploratory Study of Their Approach to Shopping," Journal of Retailing, 72 (3), 307-324. 55. Ratner, Rebecca K., and Barbara E. Kahn (2002), "The Impact of Private Versus Public Consumption on Variety-Seeking Behavior," Journal of Consumer Research, 29 (2), 246-257. 56. Rohm, Andy, and Vanitha Swaminathan (2004), "A Typology of Online Shoppers Based on Shopping Motivations," Journal of Business Research, 57 (7), 748-757. 57. Zhang, Xiaoni, Victor R. Prybutok, and Chang E. Koh (2006), "The Role of Impulsiveness in a TAM-Based Online Purchasing Behavior Model," Information Resources Management Journal, 19 (2), 54-68. 58. Fornell, C. and Wernerfelt, B. (1987), "Defensive marketing strategy by customer complaint management: a theoretical analysis", Journal of Marketing Research, Vol. 24, November, pp. 337-46. 59. Rust, R.T. and Zahorik, A.J. (1993), "Customer satisfaction, customer retention, and market share", Journal of Retailing, Vol. 69 No. 2, pp. 193-215. 60. Reichheld, F. and Sasser, W.E. Jr (1990), "Zero defections: quality comes to services", Harvard Business Review, Vol. 68, September/October, pp. 105-11. 61. Reichheld, F. and Schefter, P. (2000), "E-loyalty: your secret weapon on the web", Harvard Business Review, Vol. 78 No. 4, pp. 105-13. 62. Cronin, J.J. Jr, Brady, M.K. and Hult, G.T. (2000), "Assessing the effects of quality, value, and customer satisfaction on consumer behavioral intentions in service environments", Journal of Retailing, Vol. 76 No. 2, pp. 193-218. 63. Parasuraman, A., Berry, L.L. and Zeithaml, V.A. (1991), "Refinement and reassessment of SERVQUAL scale", Journal of Retailing, Vol. 67 No. 4, pp. 42050. 64. Parasuraman, A., Zeithaml, V.A. and Berry, L.L. (1988), "A multiple - item scale for measuring consumer perceptions of service quality", Journal of Retailing, Vol. 64 No. 1, pp. 12-40. 44

BEHAVIOUR OF ONLINE AND NON - ONLINE SHOPPERS 65. Porter, M. (2001), "Strategy and the internet", Harvard Business Review, Vol. 79 No. 3, pp. 62-79. 66. Athanassopoulos, A., Gounaris, S. and Stathakopoulos, V. (2001), "Behavioral responses to customer satisfaction: an empirical study", European Journal of Marketing, Vol. 35 Nos 5/6, pp. 687-707. 67. Bitner, M.J. (1990), "Evaluating service encounters: the effects of physical surroundings and employee responses", Journal of Marketing, Vol. 54, April, pp. 69-82. 68. Cronin, J.J. Jr and Taylor, S.A. (1992), "Measuring service quality: a reexamination and extension", Journal of Marketing, Vol. 56, July, pp. 55-68. 69. Keaveney, S.M. (1995), "Customer switching behavior in service industries: an exploratory study", Journal of Marketing, Vol. 59, April, pp. 71-82. 70. Zeithaml, V.A. (2000), "Service quality, profitability, and the economic worth of customers: what we know and what we need to learn", Journal of the Academy of Marketing Sciences, Vol. 28 No. 1, pp. 67-85. 71. Zeithaml, V.A., Parasuraman, A. and Malhorta, A. (2002), "Service quality delivery through web sites: a critical review of extant knowledge", Journal of the Academy of Marketing Science, Vol. 30 No. 4, pp. 362-75. 72. Berry, L.L. (1969), "The components of department store image: a theoretical and empirical analysis", Journal of Retailing, Vol. 45 No. 1, pp. 3-20. 73. Eastlick, M.A. and Feinberg, R.A. (1994), "Gender differences in mail-catalog patronage motives", Journal of Direct Marketing, Vol. 8 No. 2, pp. 37-44. 74. Eagly, A.H. and Chaiken, S. (1993), The Psychology of Attitudes, Harcourt Brace Jovanovich, London. 75. Dellaert, B. and Kahn, B.E. (1999), "How tolerable is Dealy? Consumers' evaluations of Internet Web sites after waiting", Journal of Interactive Marketing, Vol. 13 No. 1, pp. 41-54. 76. Degeratu, A., Rangaswamy, A. and Wu, J. (2000), "Consumer choice behavior in online and traditional supermarkets: the effects of brand name, price, and other search attributes", International Journal of Research in Marketing, Vol. 17, pp. 55-78. 45

BEHAVIOUR OF ONLINE AND NON - ONLINE SHOPPERS 77. Ernst & Young (1998), "Internet shopping: an Ernst & Young special report", Stores, Suppl. 2, pp. 1-29. 78. Fishbein, M. and Ajzen, I. (1975), Belief, Attitude, Intention, and Behavior. An Introduction to Theory and Research, Addison-Wesley, Reading, MA. 79. Ghose, S. and Dou, W. (1998), "Interactive functions and their impacts on the appeal of Internet presence sites", Journal of Advertising Research, March/April, pp. 29-43. 80. Lohse, G.L. and Spiller, P. (1998), "Electronic shopping: how do customer interfaces produce sales on the Internet?", Communications of the ACM, Vol. 41 No. 7, pp. 81-7. 81. Ryan, M.J. (1982), "Behavioral intention formation: the interdependency of attitudinal and social influence variables", Journal of Consumer Research, Vol. 9, pp. 263-78. 82. Ward, M.R. and Lee, M.J. (2000), "Internet shopping, consumer search and product branding", Journal of Product & Brand Management, Vol. 9 No. 1, pp. 618. 83. Wilkie, W.L. (1994), Consumer Behavior, Wiley, New York, NY. 84. Alderslade, Jamie. 2005. Hidden in Plain Sight: How Different Data Yield Vastly Different Understandings of the Same Market. A Comparative Analysis by Asset vs. Deficiency Data. Berkeley, CA: Greenlining Institute. 85. Anguelov, Christoslav E., Marianne A. Hilgert, and Jeanne M. Hogarth. 2004. U.S. Consumers and Electronic Banking, 1995-2003. Federal Reserve Bulletin, 90 (Winter): 1-18. 86. Aizcorbe, Ana M., Arthur B. Kennickell, and Kevin B. Moore. 2003. "Recent Changes in U.S. Family Finances: Results from the 1998 and 2001 Survey of Consumer Finances." Federal Reserve Bulletin. 87. Bernheim, B. D. 1998. Financial Literacy, Education, and Retirement Saving. In Living with Defined Contribution Pensions, edited by O. S. Mitchell and S. J. Schieber, pp. 38-68. Philadelphia: University of Pennsylvania.

46

BEHAVIOUR OF ONLINE AND NON - ONLINE SHOPPERS 88. Carr, James H. and Jenny Schuetz. 2001. Financial Services in Distressed Communities: Framing the Issue, Finding Solutions. Fannie Mae Foundation, (August): 5-30 89. Bauer, R. A. 1960. Consumer behavior at risk taking in Cox, D.F. (Ed.), Risk taking and information handling in consumer behavior, Boston, MA: Harvard University Press: 23-33. 90. Chaudhuri, A. 1998. Product class effects on perceived risk: The role of emotion. International Journal of Research in Marketing, 15:157-168. 91. Campbell, M. C. & Goodstein, R. C. 2001. The moderating effect of perceived risk on consumers' evaluations of product incongruity: Preference for the norm. Journal of Consumer Research, 28(3): 439-449. 92. Dowling, G. R. & Staelin, R. 1994. A model of perceived risk and intended riskhandling activity. Journal of Consumer Research, 21: 119-134. 93. Jacoby, J. & Kaplan, L. 1972. The components of perceived risk. Advances in Consumer Research, 1(1): 519-532 94. Laroche, M., Bergeron, J. & Goutaland, C. 2003. How intangibility affects perceived risk: the moderating role of knowledge and involvement. Journal of Services Marketing, 17(2): 122-140. 95. Liu, X. & Wei, K. K. 2003. An empirical study of product differences in consumers' E-commerce adoption behavior. Electronic Commerce Research & Applications, 2(3): 229-239. 96. Nakata, C. and Sivakumar, K. 2001. Instituting the marketing concept in a multinational setting: The role of national culture. Journal of the Academy of Marketing Science, 29(3): 255-275. 97. Pavlou, P.A. 2003. Consumer acceptance of electronic commerce: Integrating trust and risk with the technology acceptance model. International Journal of Electronic Commerce, 7(3): 101-134. 98. Tan, S. 1999. Strategies for reducing consumers risk aversion in Internet shopping. Journal of Consumer Marketing, 16(2): 163-180.

47