TOPIC: Consumer preferences towards online

consumer durable goods – an experiential study

CHAPTER- 1 INTRODUCTION:
The twenty first century is an era of digitization, where everything is available online from
groceries to gadgets. Consumers today are cognizing the benefits of digitization and asking
for more personalised dominion. The online buying has become a full arena as big as retail
store buying and now is at times preferred for means of convenience and utility gained
through various deals available. India has a large internet savvy population that is not only
accessing the internet but also buying online. With a revolution in the very basics of
transaction from a physical store format to a non-store one, the retail industry has begun to
understand the indispensability of the internet as a medium of transaction. However, the rate
of diffusion and adoption of the new phenomenon amongst consumers is still relatively low.

Trust on online transactions is one of the key barriers to vendors succeeding in online
transactions . A lack of trust discourages consumers from participating in online buying. With
the internet advancing new opportunities, it is important to understand the factors that
generate trust of Indian consumers in the online buying system . The purpose is to explore
the determinants of trust in online buying behavior of consumers and making a theoretical
attempt at conceptualizing ‘‘trust’’ as a construct, in the context of online buying and testing
it empirically. Bakos (1991), describes an e-market as ‘‘... an inter-organizational
information system that allows the participating buyers and sellers to exchange information
about prices and product offerings’’.

Meuter et al. (2000) have defined e-retailing in terms of the internet market as ‘‘a virtual
realm where products and services exist as digital information and can be delivered through
information-based channels’’. Jones et al. (2000) said ‘‘... carrying out of retailing activities
with customers that leads to an exchange of value, where the parties interact electronically,
using network or telecommunications technologies’’. We may define online-retailing as use
of an electronic via media through which the customer and the marketer may enter into a
transaction for sale and purchase, so as to benefit both the parties in the long run. The rapid
usage rate of buyers transacting online has been due to advances in technology, to consumer
characteristics (both demographic as well as psychographic) and to situational influences.
(Gupta,2015)
1.2 ONLINE SHOPPING AND E-COMMERCE IN INDIA:

E-commerce is a fast-growing retail market in the world as the growth of online sales at such
a rate will inevitably reduce the market for traditional shops. The emerging digital economy
has opened up new paradigms for retailing, and consumers across the world face new
opportunities and challenges. Online retailing has become increasingly popular way of selling
products for most organizations in the twenty-first century (Mukherjee & Nath, 2007).
As per industry body ASSOCHAM. “India’s e-commerce market was worth about USD 3.8
billion in 2016, it went up to USD 17 billion in 2017 and to USD 23 billion in 2018 and is
expected to touch whopping USD 38 billion mark by 2019,”. Increasing internet and mobile
penetration, growing acceptability of online payments and favourable demographics has
provided the e-commerce sector in India the unique opportunity to companies connect with
their customers. There would be over a five to seven fold increase in revenue generated
through e-commerce as compared to last year with all branded apparel, accessories,
jewellery, gifts, footwear are available at a cheaper rates and delivered at the doorstep. The
buying trends during 2019 will witness a significant upward movement due to aggressive
online discounts, rising fuel price and wider and abundant choice will hit the e-commerce
industry in 2019. Mobile commerce (m-commerce) is growing rapidly as a stable and secure
supplement to the e-commerce industry. “Shopping online through smart phones is proving to
be a game changer, and industry leaders believe that m-commerce could contribute up to 70
per cent of their total revenues,” the statement added. In India roughly 60-65 per cent of the
total e-commerce sales are being generated by mobile devices and tablets, increased by 50
per cent than the last year and also likely to continue upwards, it added. In 2015, 78 per cent
of shopping queries were made through mobile devices, compared to 46 per cent in 2013
(Kanupriya et.al 2016)

1.3 ONLINE BUYING BEHAVIOUR:

With the evolution of online communication through internet, customers now see online
advertisements of various brands. It is fast catching up with the buying behaviour of
consumers and is a major source of publicity for niche segments and also for established
brands. This is the new way of digital revolution and businesses worldwide have realized
their worth. Examples − Online catalogues, Websites, or Search engines. When customers
have sufficient information, they will need to compare with the choices of products or
services(Kotler et.al ,2009)
Fig 1 : Online Customer Behaviour Process(Kotler,2015)

According to the figure1, in the search stage, they might look for the product reviews or
customer comments. They will find out which brand or company offers them the best fit to
their expectation.
During this stage, well-organized web site structure and attractive design are important
things to persuade consumers to be interested in buying product or service.

Stage 1 :The most useful characteristic of internet is that it supports the pre-purchase stage as
it helps customers compare different options.

Stage 2: During the purchasing stage, product assortment, sale services and information
quality seem to be the most important point to help consumers decide what product they
should select, or what seller they should buy from.

Stage 3:Post-purchase behavior will become more important after their online purchase.
Consumers sometimes have a difficulty or concern about the product, or they might want to
change or return the product that they have bought. Thus, return and exchange services
become more important at this stage.

Factors of Online Customer Behaviour

The first elements to identify are factors that motivate customers to buy products or services
online. They are divided into two categories − external factors and internal factors.
The External Factors are the ones beyond the control of the customers. They can divide
into five sectors namely demographic, socio-economic, technology and public policy;
culture; sub- culture; reference groups; and marketing.
Internal Factors are the personal traits or behaviours which include attitudes, learning,
perception, motivation, self-image.
The Functional Motives is related to the consumer needs and include things like time,
convenience of shopping online, price, the environment of shopping place, selection of
products etc.
The Non-Functional Motives related to the culture or social values like the brand of the
store or product.

Filtering Elements Customers use these three factors to filter their buying choices and
decide on the final selection of stores they are willing to purchase from. They use the
knowledge to filter their purchase options by three factors −

 Security
 Privacy
 Trust and Trustworthiness

1.4 OBJECTIVES OF THE STUDY:

1. To understand the factors influencing adoption of online shopping with respect to
consumer durables.
2. To study the online search behaviour of online shoppers with respect to buying behaviour
of consumer durables.
3. To examine factors affecting online shoppers preferences while selecting online stores
with respect to buying behaviour of consumer durables