Chapter 1

THE PROBLEM AND ITS SCOPE

Rationale of the Study

As of 2017, there were 1.66 billion global digital buyers and according to writing

there are 7.6 billion people in the world, which means 21.8% of the world’s population

buys online. About 30% of these consumers are millennials. Incentives that influence

consumers to engage in online shopping include both utilitarian and hedonic

dimensions. A consumer’s perception about the utilitarian and hedonic consumption

helps him or her come up with a decision, and every choice comes with a potential risk.

Anything you do online, every time you provide details like your email address, shipping

address, phone number, and credit card information, your personal information

becomes prey for cyber criminals. A clear perception towards online shopping and a

secure online shopping experience through the comprehension of utilitarian and

hedonic orientations and recognition of the possible dangers it can contribute to online

scams must be introduced to every consumer. The study of Andrew Cox (2001)

supports the claim that increasing security awareness by establishing information is

effective in raising motivation and understanding of security. This framework was

conceptualized in order to guide and raise awareness to online shoppers. Hence, every

consumer all over the country, including those who study in Cebu City National Science

High School (CCNSHS), are expected to comply to this framework through identifying

the possible risks and attitude of students towards online shopping.

 Millennials are great contributors to the rapid growth of the number of online

shoppers globally. Millennials grew up in an era of technology, with access to unlimited

amounts of information. This access resulted to more publicity, awareness; created

more theories and distrust. For the researchers this resulted in endless signs of doom

and anxiety. Given their experiences, millennials approach online shopping quite

distinctively than older generations do. This requires brands to understand their

priorities, decision making and consumption behaviors. Economically, the generation

has been entirely challenged. Student loans, debts, working students have also

increased. According to Psychology Today (2016) millennials are reporting the highest

levels of clinical anxiety, stress, and depression than any other generation at the same

age.

The study of Angela Woo (2018) investigated on understanding the research on

millennial shopping behaviors. It was found on the highlights from their data that 60% of

millennials tend to be drawn by products that are an expression of their personality.

Also, half of the millennials prefer to spend their money on experiences over material

things. They have no problem trying new, their loyalty to the brand is low, this tells us

that millennials are indecisive and have great probability to spend more and observe

more risks as they spend.

The researchers’ study focuses on the motivators that affect students’ decision

making in online shopping based on the utilitarian and hedonic orientations. It also

focuses on identifying the risks and to know if these affect students’ online shopping

behavior.
Theoretical and Conceptual Framework

The Technology Acceptance Model (TAM) has been extensively used in studies

to explain and predict user behavior in an online shopping environment. TAM posits that

actual system use is determined by users’ behavioral intention to use, which is in turn

influenced by their attitude toward usage. Attitude is directly affected by users’ belief

about a system, which consist of perceived usefulness and ease of use (Davis, Bagozzi,

& Warshaw, 1986). Delafrooz, Haron, Khatabi, Paim, and Sidin, (2009) developed TAM

to predict and to explain consumer acceptance of online shopping by extending the

belief-attitude- intention-behavior relationship in TAM from the perspectives of shopping

orientations and perceived usefulness. Perceived risk pertains primarily to searching

and choosing information of products or services before purchasing decisions. Several

perceived risk were identified and used by previous researchers.

The conceptual framework as shown in Figure 1 shows that Online Shopping

Orientations and Perceived Risk affect students’ attitude towards online shopping,

which may motivate them to shop online. Online shopping orientations include utilitarian

and hedonic. ​Utilitarian orientation is as rational type of orientation intended for ones

needs while hedonic is the type of orientation that is more on pleasure aspect of online

shopping. Three perceived risks are highlighted in this study. They are perceptions to

product risk, a risk of failing to meet the expected product qualifications, financial risk,

the risk of suffering a loss of money, and to privacy risk, the risk of having personal

information disclosed because of online transactions.

 Figure 1. Research model

Statement of the Problem

This study investigates the factors that motivates students of Ceu City National

Science High School to shop online. Specifically, this study sought to answer the

following questions:

1. What shopping orientations affect students’ attitude towards online shopping?

1.1 Utilitarian Orientations

1.2 Hedonic Orientations

2. Are students aware of the risks involved in online shopping?

2.1 Perceived Product Risk

2.2 Perceived Financial Risk

2.3 Perceived Privacy Risk

3. Does risks minimize students’ online shopping activity?

Definition of Terms

The following terms are operationally defined in accordance to their use in the

study:

Attitude ​towards a behavior refer to the degree to which a person has

favorable or unfavorable evaluation of the behavior of the question. Attitudes

toward online shopping are defined as a consumer’s positive or negative

feelings related to accom​plishing the purchasing behavior on the internet.

Hedonic orientation ​is the type of orientation that is more on the emotional and

experiential aspects of online shopping. It includes happiness, fantasy, and

enjoyment. It focuses on the wants than the needs of the consumer.

Financial risk​ is defined as the likelihood of suffering a monetary loss from a

purchase.

Online shopping ​refers to being involved in buying items from internet sites. It is

the act of purchasing goods, products or services through the internet.

Perceptions ​refers to raised level of awareness of a consumer’s attitude towards

online shopping and the risks that comes after the decision making; through

human senses.

Perceived Risk ​refers to the customer's awareness of the risks associated with

any purchase and is mostly associated with products

Privacy risk​ is defined as the probability of having personal information

disclosed as a result of online transactions.

Product risk​ is defined as the probability of the item failing to meet the

performance requirements originally intended.

Risks ​refer to the potential danger to the consumers brought by online shopping.

Internet scams, bad effects of shopping online like unable to focus on the

priorities, and so many more.

Utilitarian orientation ​is as rational, critical, decision effective, and goal oriented

type of orientation. It consists of seeking for convenience, variety, and quality of

products. is focused more on the needs of the consumer than the wants,