A PROJECT REPORT

ON

A STUDY ON BUYING BEHAVIOUR OF ONLINE CUSTOMERS

NOHIL BIDYADHAR THAKUR

HPGD/JL21/1038

SPECIALIZATION: MARKETING

WELINGKAR INSTITUTE OF MANAGEMENT DEVELOPMENT & RESEARCH

JUNE 2023

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UNDERTAKING BY CANDIDATE

I declare that project work entitled ‘A study on buying behaviour of online customers’

is my own work conducted as part of my syllabus. I further declare that project work

presented has been prepared personally by me and it is not sourced from any outside

agency. I understand that, any such malpractice will have very serious consequence

and my admission to the program will be cancelled without any refund of fees. I am

also aware that, I may face legal action, if I follow such malpractice.

_______________________

Signature of Candidate

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Table of Contents
1 Introduction
1.1 Background
1.2 Problem Observed
1.3 Research Purpose
1.4 Limitations
1.5 Summary

2 Objectives Of the Study

3 Method
3.1 Choice of Methodology
3.2 Research Approach
3.3 Research Philosophy
3.4 Research Strategy
3.4.1 Secondary Data
3.4.2 Primary Data

4 Theory
4.1 Introduction
4.2 Consumer Behaviour
4.2.1 Consumer Characteristics
4.2.2 Online Consumer Characteristics
4.3 Specific Consumer Traits and Online Behaviour
4.4 Important Influencing Factor
4.4.1 Identified Factors Affecting Online Behaviour
4.5 Summary

5 Empirical Research Method

5.1 Segments
5.2 Sample
5.3 Convenience Sampling
5.4 The Questionnaire
5.5 Reliability
5.6 Validity
5.7 Generalizability
6 Results
6.1 Introduction
6.2 Questionnaire – Collected Data
6.2.1 Online Consumer Traits
6.2.2 Attitude and Beliefs
6.2.3 Online Consumer Behaviour

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7 Analysis
7.1 The Factors
7.2 Two Step Cluster

8 Conclusion
9 References

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Abstract

The recent growth of e-commerce and the consumer’s increasing interest in

purchasing over the net have significantly changed the landscape of Indian retail
market. Today customers are inclined to accept the changes and keep their eyes on
the benefits they can obtain from online retailers. The recent example of changing
consumer purchase pattern is the flipkart’s ‘Big Billion day’ Sale. The growth in online
sales can be partially attributed to the Internet’s advantages of providing large amounts
of information quickly and inexpensively and its growing accessibility. Yet, to reach its
full potential, business owners who use ecommerce as a distribution channel need a
clearer understanding of who buys online, what they buy online, why they buy online,
and how the non-Internet buyer can be transformed into an online buyer in order to
increase online sale.

1. Introduction

The introduction of this topic will give a brief about the current scenario pertaining to
the topic thus explaining the purpose of this study.

1.1 Background

The internet has become a crucial channel for communication, research,

entertainment, and online shopping. In India, online shopping has gained immense
popularity, with statistics supporting its significant growth. India currently has a user
base of 150 million internet users, making it the third-largest in the world. The number
of users accessing the internet through mobile devices has been doubling every year
since 2009.

The e-commerce market in India is valued at approximately $107 Billion, with the online
shopping segment alone worth $63 billion. Unlike the global growth rate of online
shopping at 8-10%, India's online shopping market has been growing at a rate
exceeding 30%. Experts predict that India's direct-to-customer e-commerce market is
expected to reach $111 Billion by 2024 and $200 Dollar by 2026. India's online
customer base of around 40 million shoppers has the potential to increase by 14% to
reach 300 million shoppers within the next decade.

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Social media activity also plays a crucial role in predicting shopping behavior, with 62.7
million Facebook users in India, representing 68% of the country's online population.

However, despite having 150 million internet users, only around 10 million users
currently engage in online transactions, indicating that the e-commerce industry in
India is still in its early stages. This presents a significant opportunity for e-retailers, as
the average annual growth rate for this market is estimated to be around 70%
according to the Internet and Mobile Association of India. In 2021, the total number of
digital buyers was 289 million in India. The number of digital buyers is likely to increase
to 378 million by 2025.

Given the unique characteristics of the Indian market and the rapid growth potential, it
is essential for the industry to focus on factors that influence the buying behavior of
Indian customers. While numerous studies have explored customer characteristics and
online shopping behavior, most of them have been conducted outside of India.
Therefore, this research aims to address this gap by examining how various customer
characteristics impact purchase intentions in the Indian online shopping context.

1.2 Problem Observed

At any given time, there are millions of people online and each of them is a potential
customer for a company providing online sales. Due to the rapid development of the
technologies surrounding the Internet, accompany that is interested in selling products
from its website will constantly have to search for an edge in the fierce competition.
Since there are so many potential consumers, it is of the out most importance to be
able to understand what the consumer wants and needs.

The importance of analyzing and identifying factors that influence the consumer when
he or she decides to purchase on the Internet is vital. Since the Internet is a new
medium for there have been new demands set by the consumer. That is why it is crucial
for the online retailers to know what influences the online consumer.

Analyzing consumer behaviour is not a new phenomenon. The renowned marketing

expert Philip Kotler has published several works on the topic of consumer behaviour
theories. These theories have been used for many years not only to understand the
consumer, but also create a marketing strategy that will attract the consumer efficiently.

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Hence, understanding and identifying the consumer is closely related to the directions
a company will take with their marketing strategy. These theories can also be applied
to identify the online consumer and to create certain consumer segments.

However, some distinctions must still be made when considering traditional consumer
behaviour and online consumer behaviour.

Since online retailing is a fast-growing retail medium and online consumer behaviour
is diverse from traditional consumer behaviour, one must identify what influences the
online consumer. Analyzing the process that the online consumer goes through when
deciding and making a purchase over the Internet, shows some factors that consumers
consider. These factors need to be identified and taken into account by online retailers
in order to satisfy consumer demands and compete in the online market. To further
understand how these factors influence different types of consumers, I must identify
segments which will enable us to make comparisons.

1.3 Research Purpose

This research seeks to identify the primary factors influencing online consumer
purchasing decisions and examine the possibility of establishing consumer segments
based on these factors. The study aims to provide valuable insights into online
consumer behavior and offer implications for online retailers to enhance their
understanding of consumers. By aligning their strategies with the identified factors and
consumer segments, online retailers can improve their consumer knowledge and
optimize their online marketing approaches. The ultimate goal is to increase the
effectiveness of online marketing strategies, thereby enhancing customer satisfaction
and driving business growth in the highly competitive online marketplace.

1.4 Limitations

The online consumer is influenced by various factors, but this study aims to identify the
key factors and focus on them to investigate their impact. Consumer behavior is a vast
field with numerous theories and models. However, this research will specifically
concentrate on understanding consumers through their characteristics and the buying
process.

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It acknowledges that consumer behavior varies depending on the product or service
being purchased, and different factors hold varying importance for consumers in
different contexts. Therefore, the research will primarily focus on a widely purchased
product online, as it aligns with the practical constraints of limited time and resources.

1.5 Summary

Since the rapid development of the Internet online shopping has become a new and
widely used medium for retailing. In order to understand the consumer the retailers
need to know what influences the consumer. That is what I want to accomplish with
my research.

2. Objectives Of the Study

The objective of this research study is to investigate online consumer behavior, which
in turn provides E-marketers with a constructional framework for fine-tuning their E-
business strategies.

The specific objectives of this research are:

▪ To analyze the consumers awareness about online shopping.

▪ To know the various factors which motivate a consumer towards online shopping.
▪ To analyze the kind of goods they purchase online.
▪ To know the problems faced during online shopping.

3. Method

3.1 Choice of Methodology

To understand what factors influencing online consumer behavior, I conducted a

thorough review of existing literature on consumer behavior and e-commerce. I
focused on studies that shared similar goals and carefully examined their findings to
expand my knowledge on the subject. Initially, my research was exploratory in nature,
aiming to gain insights into online consumer behavior after building a foundation of
understanding consumer behavior in general.

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As my research progressed, it transitioned into an explanatory study. To gather primary
data, I created a questionnaire for participants, specifically targeting students and
employees. This allowed me to collect valuable insights directly from individuals who
engage in online shopping. With the collected data in hand, I proceeded to analyze the
specific factors that have a significant impact on online purchasing decisions.
Furthermore, I explored the relationships and correlations between these factors to
uncover meaningful patterns.

The ultimate goal of this research is to contribute to a deeper understanding of online

consumer behavior. By providing valuable insights and findings, this study aims to
support further analysis and assist in making strategic decisions that can improve
online marketing and customer experiences.

3.2 Research Approach

In this research, two commonly employed approaches are the inductive and deductive
methods. The inductive method involves formulating a theory based on collected data,
while the deductive method seeks to establish a theory first and then test it against
observed data. For my study, I opted for a deductive research approach, moving from
the general to the specific. In the upcoming chapter, I will present theoretical findings
on consumer behavior. Subsequently, in chapter four, I will introduce my questionnaire
and present the primary data collected.

3.3 Research Philosophy

When it comes to collecting and analyzing data, the research philosophy can be
categorized into three main approaches: Positivism, Realism, and Interpretivism.

Positivism involves the researcher aiming to remain unbiased and unaffected by the
subject of the research. They believe that by collecting and analyzing data, they can
simplify and generalize it using existing theories. This approach focuses on developing
hypotheses based on established theories.

Realism, similar to positivism, assumes that there is an independent reality that exists
outside of our minds. It also emphasizes a scientific approach to gaining knowledge.

For my research, I will be adopting a positivistic approach. This means that I will try to
minimize my interference and bias in the collected data. I will rely on existing theories
to analyze the data and draw general conclusions.

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3.4 Research Strategy

When collecting data to approach the purpose of a research there are two ways in
which the data can be collected. In order to acquire a general knowledge about the
topic, secondary data is primarily used and is one of the ways by which data can be
collected. These Conway to collect data is the primary data collection. Usually when a
study is conducted, secondary data is not sufficient enough and needs to be completed
with primary data which is collected by the researcher.

3.4.1 Secondary Data

Secondary data can be classified into three different subgroups: documentary, multiple
sources, and survey. Documentary second and data comes in both written and non-
written form. It is the data that can be collected from sources such as journals,
databases, transcripts etc. This form of data is dependent on the access the researcher
has to it. Survey based secondary data is the data that is collected through the survey
and is available as data table forms. Multiple source secondary data is data that has
been compiled into documentary or survey form; the main characteristics of this type
of data is that it has been changed into a different form before there searcher is
assessing the data.

I have mainly used documentary secondary data combined with multiple source data.
Documentary secondary data has been the data collected through different types of
research conducted within the topic, articles, and that are written on consumer
behaviour and ecommerce. This type of data has been the fundamental source for
gaining knowledge within the topic in order for us to be able approach the research
problem. The secondary data that I used for our research his data that has also lead
to the conclusion of which factors that will be examined. The multiple source data that
I have used has been in order to choose which product I would use for our research in
order to be able to find the product that is most widely bought over the Internet.

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3.4.2 Primary Data

Primary data for our research was collected through questionnaires. When collecting
primary data one can choose to do interviews, observations, experiments, and
questionnaires.

Due to the purpose of our research, only the questionnaire method would be able to
approach the topic and be able to collect the answers in a satisfactory manner. In our
research the primary data is mainly concerned with analyzing the respondent in order
to later on classify the respondent. Further on, the primary data will be used to analyze
the factors and how these are related to the respondent.

4. Theory

4.1 Introduction

This dissertation focuses on understanding the factors that influence consumers'

online buying behavior. By reviewing existing literature on consumer characteristics
and online consumer behavior, the aim is to identify important factors for online
shoppers.

The Internet is a global network of interconnected computers that transmit data using
the Internet Protocol. It has evolved into a marketplace for information exchange and
e-commerce, with businesses incorporating the World Wide Web into their promotional
campaigns and offering online purchasing options. Being present on the internet has
become crucial for companies, as it allows them to provide information and services to
customers more efficiently and at a lower cost compared to traditional methods.

The Internet provides companies with the opportunity to understand their customers'
needs by collecting data and offering tailored information. However, the online
environment lacks the structure and rules, making it challenging for companies to stand
out and attract consumers. Businesses without a physical presence need to invest
significantly in marketing efforts, both online and offline, to ensure consumers
remember their brand.

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Regardless of the market, marketers must understand how consumers make decisions
and purchasing choices. Consumers are constantly exposed to stimuli from marketers'
advertisements, and their interpretation of this information is influenced by various
individual factors. Marketers have developed theories to explain consumer behaviors
based on these factors. Several articles have attempted to identify the characteristics
of online consumers. Some common characteristics include being younger, wealthier,
better educated, having higher computer literacy, and being bigger spenders on retail.

However, identifying the online consumer is challenging due to the rapid development
of e-commerce and the diverse types of consumers. Additionally, the type of product
being purchased also influences online consumer behavior. Despite these
complexities, there are still specific characteristics that can help specify the online
consumer.

4.2 Consumer Behaviour

Donal Rogan (2007) explains that the connection between consumer behavior and
marketing strategy is centered around increasing the likelihood and frequency of
consumer purchases. In order to achieve this, it is essential to truly understand the
customer and their needs and wants.

Chisnall (1995) highlights the strong relationship between human needs and motives,
making it difficult to distinguish between the two. For example, someone may buy a
new coat primarily for protection against the weather, but their deeper underlying
motivation might actually be to stay in line with the latest fashion trends. Recognizing
these underlying motives becomes crucial in the field of marketing.

Kotler and Armstrong (2007) have developed important theories regarding the
characteristics of buyers, which provide insights into how consumers interpret and
respond to advertisements. Consumer decisions are influenced by various individual
traits that are connected to their specific needs and desires.

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4.2.1 Consumer Characteristics

Consumer characteristics can be categorized into four main types:

• Cultural Characteristics
• Social Characteristics
• Personal Characteristics
• Psychological Characteristics

Marketers identify these characteristics to understand consumers better and make

informed decisions on which consumer groups to target. By segmenting the market
based on these characteristics, marketers can tailor their strategies to specific
consumer groups, allowing for more effective targeting and messaging.

❖ Cultural Characteristics

Consumer behavior is strongly influenced by cultural characteristics, specifically

culture, subculture, and social class. Culture, as the foundation, shapes individuals'
wants and needs by imparting values and beliefs from an early age. Marketers
recognize the significance of cultural characteristics in understanding consumer
preferences and behaviors, as they provide insights into decision-making processes.

Subcultures, formed by smaller groups with shared values and beliefs, offer marketers
the opportunity to target specific market segments effectively. Identifying and
understanding subcultures based on factors such as nationality, religion, or geographic
region allows for tailored marketing strategies that resonate with the values and
preferences of these consumer groups.

Social class, determined by socioeconomic factors, plays a significant role in shaping

consumer behavior. Individuals within the same social class often exhibit similar
preferences, lifestyles, and purchasing patterns. Marketers take into account social
class characteristics, such as income, occupation, and education level, to develop
strategies that align with the needs and aspirations of specific consumer segments

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• Social Characteristics:

The Social Characteristics are divided into three different categories, namely:

• Reference Groups
• Family
• Role and Status.

Reference Groups – Reference Groups have a significant impact on our behavior,

and this is mainly because we are influenced by various small groups in our lives.
When a group directly affects us, we call it a Membership Group. These can include
our family, neighbors, and co-workers, for example. On the other hand, Reference
Groups are the groups that we admire and aspire to be a part of, even though we are
not actual members.

Reference Groups have both direct and indirect effects on our behavior and attitudes.
They can expose us to new behaviors and lifestyles, influence our attitudes and self-
perception, and create a pressure to conform to their norms and values.

Furthermore, individuals belong to multiple groups and assume various roles and
positions within these groups. These roles represent the activities and expectations
from other group members. Marketers can gain valuable insights by understanding
these roles and effectively tailor their communication strategies to reach specific
individuals or segments.

Family - Family members have a significant influence on individuals' purchasing

decisions, although the extent and nature of this influence may vary among family
members. To effectively reach and influence consumers, it is vital for marketers to have
a comprehensive understanding of the specific roles played by each family member
and their contributions to shaping buying behavior. By identifying the varying degrees
of influence within the family, marketers can strategically target their advertising efforts
towards the key influencers.

This understanding enables them to customize their advertisements and marketing

strategies accordingly. Such targeted approach ensures that marketing messages
effectively reach and resonate with the individuals who wield the greatest influence
over the family's buying decisions.

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Roles and Status - In social contexts, individuals participate in various groups and
assume diverse roles and positions within those groups. These roles, as defined by
Kotler and Armstrong (2007), represent the activities and behaviors that other group
members expect from us.

As individuals, we belong to multiple groups simultaneously, each with its own set of
expectations and dynamics. In these groups, we fulfill specific roles that define our
responsibilities and contributions within the group setting. These roles can vary widely,
ranging from leadership positions to supportive or task-oriented roles.

Understanding the roles that individuals play within different groups is essential for
marketers. By comprehending these dynamics, marketers can tailor their
communication and marketing strategies to effectively engage and influence specific
individuals or segments within the groups. Recognizing the roles and positions held by
individuals allows marketers to better understand their needs, motivations, and
preferences, enabling them to create targeted and impactful marketing campaigns.

• Personal Characteristics:

These personal characteristics are categorized into:

• Age and Life-Cycle

• Occupation
• Economic Situation
• Lifestyle
• Personality
• Self-Concept.

The Age and Life-Cycle Stage - These stages explain different periods in life that the
consumer experiences as he goes through life. These different stages also represent
different changes that the consumer may experience when reaching a new stage.
According to Kotler and Armstrong (2007) marketers, therefore, define their target
markets in terms of the different stages in order to develop appropriate marketing
plans.

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Occupation - The occupation tends to have an effect on the products and services
bought by the consumers. This leads to the possibility of developing different types of
products or services that suits interests identified to be above average within an
occupation.

The Economic Situation - Wealth will affect a consumer’s product choice. A

consumer may be price- sensitive or not depending on the level of income, level of
savings, level of interest rates, and also the product or service itself. 9 Lifestyle–This
is identified to be a person’s way of living which is recognized by the activities, interest,
or opinion she or she has and it also explains the way a consumer interacts in the
world.

Personality - This is mainly explained by the terms self-confidence, dominance,

sociability, autonomy, defensiveness, adaptability and aggressiveness. These
psychological factors are a result of one’s environment. Personality can be defined as
a dynamic and organized set of characteristics possessed by a person that uniquely
influences his or her motivations, and behaviour in various situations.

Self-concept - Is the conceptual understanding that people’s possessions reflect their

personalities. This concept does bring some conflicts in case people may have an
image that satisfies who they are but does not agree with who they want to be (the
ideal self-concept), the question then arises which one I would want to satisfy.

• Psychological Characteristics

The psychological characteristics of a consumer are broadly divided into the following
concepts:
• Motivation,
• Perception,
• Learning,
• Beliefs and Attitudes

Motivation - Motivation pertains to the needs that individuals have and seek to fulfill.
These needs can be categorized into various types, including biological needs like
hunger, thirst, and comfort, as well as psychological needs such as the desire for
recognition, esteem, and belonging.

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These needs become motives for consumers when they reach a certain level of
intensity and drive them to take action to satisfy them.

Kotler and Armstrong (2007) discuss different motivation theories, including Freud's
and Maslow's theory which state that, individuals may not fully comprehend their own
motivations. On the other hand, Maslow proposed a hierarchy of needs, where some
needs take priority over others. This hierarchy consists of psychological needs, safety
needs, social needs, esteem needs, and self-actualization needs. Once one need is
satisfied, individuals move on to fulfilling the next need in the hierarchy

Perception - These characteristics are based on the understanding of how differently

I perceive the same situation or the same stimuli. Kotler and Armstrong (2007) explain
perception as the process by which people select, organize, and interpret information.
There are three different processes that decide how I interpret certain information.
These are Selective Attention, Selective Distortion, and Selective Retention.

Learning - Learning is, according to Kotler and Armstrong (2007), an act that changes
people’s behaviour because of their experience. It occurs through drives: strong
internal wants that call for action, stimuli: object that drives for certain action, cues:
small stimuli that determinate when, where and how the person will respond and
reinforcement: when the response and stimuli towards an object is experienced more
than once.

Beliefs and Attitudes - These are acquired by people through learning and
experiencing. They influence the buying behaviour by making up brands and product
images in the consumer’s heads. A belief is explained by Kotler and Armstrong (2007)
as a descriptive thought about something and is 10 based on real knowledge, opinions
or faith. Beliefs can also be emotionally charged. Attitudes are described as a person’s
evaluations, feelings, and tendencies towards something, but also determinations of
people such as like and dislikes.

4.2.2 Online Consumer Characteristics

In order to understand online purchasing behavior, it is important to identify specific

characteristics of online consumers and segment them accordingly. These
characteristics provide key insights into the behavior of online consumers.

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• Cultural Online Characteristics:

Smith and Rupp (2003) note that social class differences influence online purchasing
behavior. Consumers from higher social classes tend to make more online purchases
and have a greater intention to buy online, as they are more likely to possess
computers and have better internet access. On the other hand, consumers from lower
social classes may not have the same resources and computer literacy to leverage
online shopping.

• Social Online Characteristics:

The social influence on online consumers is derived from new reference groups
compared to traditional ones. Virtual communities, such as discussion groups on
websites, serve as new reference groups for online consumers. These communities
allow consumers to read about others' experiences and opinions, which influence their
own purchasing decisions. Additionally, links to product-related websites serve as
reference groups by encouraging product selection and providing contact information.

Personal Online Characteristics:

Monsuwé, Dellaert, and Ruyter (2004) examined personal online consumer

characteristics and found that income of a consumer plays a vital role in online
purchasing behavior. Higher household income is associated with a more positive
attitude towards online shopping, as it correlates with computer ownership, internet
access, and higher education.

Age is also identified as a determinant of online purchase intentions. Smith and Rupp
(2003) suggest that older individuals with less frequent interactions with the internet
and computers are less likely to use online platforms for purchases. In contrast, young
adults are more inclined to make online purchases due to their frequent internet and
computer usage. Younger people also tend to have more technical knowledge and
exhibit a greater interest in using new technologies for information browsing and
evaluating alternatives.

Understanding these cultural, social, and personal characteristics of online consumers

helps marketers tailor their strategies to effectively target and engage specific
segments of the online market.

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Psychological Online Characteristics:

Smith and Rupp (2003) identified the psychological characteristics of consumer

behaviour as questions the online consumer would ask himself before making a
purchase online. These are of various types as listed below:

Motivation - The consumers are reasoning for incentives to engage in a particular

behaviour and might ask himself frequent questions like:

• Should I look around for better price?

• If online shopping saves me time, should I shop online more often?
• How much do I really need this product?

Perception - The consumer is interpreting acquired information by classing it. The

consumer may come across the following thoughts:

• I feel that this site seems pretty secure.

• It seems that this site has good products.
• How can I be sure about the products being genuine or not?

Personality - The consumer is adapting to influences of his cognitions. He may ask

himself, what types of Web sites are best suited for his personal buying preferences.

Attitude - The consumer is working out what his likes and dislikes are in respect to a
particular situation. He may ask himself questions like:

• I am pretty unsure about extra costs, should I really be buying items from the
Internet?
• If I do not buy the item online, how else can I get it?

Emotions - The consumer without conscious efforts tries to detect how he’s being
affected by his cognitive choice. He may ask himself:

• The last time I ordered from the Internet I had a really bad experience, Should I
try buying online again?
• What is the future of buying online? If Websites get better, should I invest more
time in buying online?

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4.3 Specific Consumer Traits and Online Behaviour

To gain insights into the online consumer and their behavior, it is crucial to identify
specific consumer traits that significantly impact their online experience. These traits
encompass personal, social, and psychological characteristics, shedding light on the
consumer's lifestyle, identity, and attitudes towards online shopping.

Moreover, understanding how consumers utilize the Internet unveils their online
behavior, providing further understanding of their preferences and actions in the online
marketplace.

Let’s take an overview at some of these characteristics of the online consumers by

analyzing the following:

• Demographics of the consumer, as studied by Bergman et al. (2005), provide

valuable insights into understanding the online consumer.
• The consumer's online behavior is influenced by their life patterns, including the
frequency of Internet usage and web graphics, as highlighted by Bergman et al.
(2005).
• The purposes for which consumers use the Internet, known as Internet usage,
also studied by Bergman et al. (2005), play a significant role in shaping their
online behavior.
• Online shopping patterns, such as the frequency and extent of online purchases,
can be utilized to analyze the impact of various factors on different types of
consumers, as researched by Bergman et al. (2004).
• Previous experiences play a crucial role in shaping the beliefs and attitudes of
consumers towards online shopping and are therefore important for research, as
identified by Monsuwé. (2004).
• Social influences, referred to as reference groups by Christopher and Huang
(2003), impact consumers during the early stages of decision making.

These are the consumer characteristics that are relevant for this research and need to
be identified in order to find out who the online consumer is and what affects him when
shopping online. These I will be referred to as Consumer Traits and Online Behaviour.

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To summaries the prior text and to answer the question what identifies an Online
Consumer, one can draw the conclusion that for this research the important consumer
characteristics that need to be identified are:

➢ Consumer Traits
• Demographics
• Attitude and Beliefs
• Impact of Reference Groups
➢ Online Behaviour
• Webographics
• Online Shopping Patterns
• Internet Usage

Gender, Age,
Demographics
Income

Online Consumer Previous & Future

Attitude & Belifs
Traits Experience

Impact of Family, Friends &

Reference Groups Online forum
Online Consumer
Segments
Webographics Time Spent Online

Online Shopping
Online Behaviour Expenditure
Patterns

Fun, Work, Emails,

Internet Usage Information,
Shopping

4.4 Important Influencing Factors

During the analysis of existing literature, several influential factors emerged that are
crucial for understanding specific consumer traits and online behavior. Brengman,
Geuenes, Weijters, Smith, and Swinyard (2005) emphasized the significance of
internet usage lifestyle in segmenting online consumers. They proposed that the online
consumer's identification is closely tied to their internet experience. Lifestyle, which
encompasses personal characteristics and demographics, provides insights into
consumers' opinions, interests, and reasons for utilizing the internet.

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The study identified four distinct segment groups based on shopping behavior,
revealing that price, trust, and convenience play pivotal roles in influencing the online
consumer's behavior. A framework was developed to comprehend consumer attitudes
towards online shopping. Attitudes and beliefs were identified as separate entities from
psychological characteristics, primarily influenced by learning and prior experiences.
Additionally, Wallace in 2009 emphasized the importance of the internet's ability to
facilitate price comparisons, a significant motivation for consumers. Furthermore,
price-sensitive shoppers prioritize obtaining products at the lowest price or achieving
the best value for their money.

Numerous studies have attempted to identify and segment online consumers, and
through comprehensive review, certain factors consistently emerged. Among these
factors, price, trust, and convenience consistently stood out as highly significant.
Therefore, these three factors warrant our focused attention in understanding and
analyzing online consumer behavior.

4.4.1 Identified Factors Affecting Online Consumer Behaviour

Price is a crucial factor in the marketing mix as it serves as a tool to stimulate

consumers and communicates information about the product's value, quality, and
competitiveness. Consumers utilize price to compare products, assess value for
money, and judge product quality.

Trust, on the other hand, is an emotional concern for consumers, particularly related
to their safety needs. Establishing trust is crucial for consumers before making a
purchase.

Convenience, as perceived by consumers, is a benefit derived from online purchasing

and is considered a motivating and benefiting factor. It enhances the overall consumer
experience.

These factors - Price, Trust, & Convenience - significantly influence consumer

behavior in the online shopping context. To gain a deeper understanding, further
analysis of the underlying attributes depict how these factors impact consumers is
necessary.

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- Price Factor
The Internet has transformed into a global marketplace where consumers can easily
access and compare product information and prices. This technological advancement
enables sellers to differentiate between buyers, and buyers to evaluate multiple
vendors. Traditionally, prices were determined through negotiations and product
examination. However, the internet allows for effortless price comparisons,
disregarding certain digital attributes and the potential to explore various vendors
simultaneously. Price-sensitive consumers are primarily interested in comparing
prices, while another category seeks unique products with specialized features that
may be challenging to find offline, prioritizing price as secondary. Nonetheless, online
consumers can only assess digital attributes, whereas offline purchases offer the
opportunity for physical product inspection. This limitation may prompt impulsive
shoppers to exercise caution. Additionally, supplementary costs like shipping charges,
customs fees, or extended delivery times can impact the decision-making process of
online consumers, even if the price appears favorable. The Price factor has namely
two attributes:

1. Saving Money
2. Price Comparison

- Trust Factor
As online shopping is a relatively new phenomenon, consumers perceive it as risky
due to the absence of familiar elements such as salespersons who traditionally served
as a source of trust and expertise. This lack of face-to-face interaction raises concerns
about the quality of products and the security of personal data. However, the authors
suggest that effective communication of high-level security measures and privacy can
positively impact consumer trust and their intention to buy online.

According to sociologist Luhmann, trust is built upon familiarity, confidence, and trust
itself, with trust being particularly relevant in situations involving high perceived risk,
such as online transactions. The consumer's prior experiences and trust in
computerized systems significantly influence their trust in online shopping.

23
Lee and Turban (2001) highlight three factors that contribute to human trust in
computerized systems:

1. Perceived technical competence: The system's apparent ability to fulfill assigned

tasks.
2. Perceived performance level: The system's speed and reliability in completing
tasks.
3. The human operator's understanding of the underlying characteristics and
processes governing the system's behavior.

These factors collectively shape the consumer's level of trust in the online shopping
experience and the technology facilitating it.

Turban et al developed a model that outlines the key components of trust in the context
of online purchasing. "A Trust Model for Consumer Internet Shopping" trust is
contingent upon six variables.

Seller

Trust in Internet Competency

Benevolence

Ec Trust

Reliability

Trust in internet as
Understandability
Shopping channel

Security and
Payment

A company must show the consumer that it is competent in managing information and
supporting the consumer after a purchase is done. If that can be achieved, the
consumer is more likely to engage in trust related Internet activities like purchasing,
cooperating and sharing information.

24
To summaries the trust factor, it is more likely to be seen that this factor namely has
the following attributes in regards to consumer:

1. Perception of Safety
2. Trust in the Internet retailer
3. Trust in the Concept of Internet Retail Shopping

- Convenience Factor

Convenience, as defined by the Swedish National Encyclopedia, encompasses actions

or features that aim to reduce time and minimize frustration. Additional definitions of
convenience include:

• The characteristic of being well-suited to an individual's comfort, purpose, or

needs.
• Personal comfort or advantage derived from a certain action or situation.
• Anything that enhances comfort or reduces the effort required at a suitable or
agreeable time.

Online shopping offers several advantages as a modern retailing medium. One notable
advantage of online shopping is its convenience compared to traditional shopping
methods. The convenience attributes associated with online shopping include:

• Reduced effort: Shopping can be done from the comfort of one's home.
• Time saving: Online shopping eliminates the need to physically visit stores,
saving time in the process.
• Tracking of the package allows customers to keep a track of delivery.
• 24/7 availability: Online shopping allows consumers to shop at any time of the
day, without being constrained by store opening hours.

According to Azjen (as cited in Kim & Park, 1991), online shopping offers convenience
to consumers through time savings and search convenience compared to traditional
shopping methods.

Kim and Park (1991) further argue that for online shopping to be perceived as
convenient, consumers need to perceive ease of access to the Internet and ease of
carrying out online shopping behaviors. The simpler the process of accessing the

25
 Internet is perceived, the more likely consumers are to pay attention to entering the
online space and searching for information.

The convenience factor levies itself by the following attributes:

• Saving Time
• Minimal Efforts
• Time Flexibility

4.5 Summary

Through an examination of consumer behavior theories, the focus has been on

understanding the online consumer's buying behavior and identifying the
characteristics that define and segment them.

Two main categories have been identified as:

• Consumer Traits.
• Online Behavior.

Under Consumer Traits, the subsegments include Demographics, Attitudes and

Beliefs, and the impact of Reference Groups, whereas under Online Behavior traits,
Webographics, Online shopping patterns, and Internet usage are listed.

Additionally, the factors of Price, Trust, and Convenience have been highlighted as
important influences on the online consumer's shopping experience. To fully
understand the impact of these factors, it is crucial to identify the online consumer
based on the relevant consumer traits and online behavior identified earlier.

Price Convenience Trust

Demographics Webographics

Attitude and Online Online Online

Online Shopping
Belief Consumer Consumer Consumer
Patterns
Traits Segments Behaviour

Impact of Internet Usage

Reference

Implications for Online Retail Store

The Effect of Influencing Factor's on Online Consumer Segments

26
To assess the relevance and impact of factors on online consumers, it is important to
understand and segment them based on consumer traits and online behavior. This
segmentation in the above flow diagram, charts a comparison of how different
segments perceive factors such as Price, Trust, and Convenience. By analyzing the
responses of each segment, implications can be drawn for online stores.

5 Empirical Research Method

The empirical research method employed in our study followed a deductive approach.
We started by collecting and analyzing existing secondary data to identify the factors
that play a significant role in online consumer behavior, specifically focusing on Price,
Trust, and Convenience. To gain deeper insights into these factors, we conducted a
survey to collect primary data directly from online consumers.

One of the key objectives of our research was to establish Online Consumer Segments
based on Consumer Traits and Online Behaviour. These segments allowed us to
categorize and group online consumers with similar characteristics and behaviors,
enabling us to explore the impact of Price, Trust, and Convenience across these
distinct segments.

5.1 Segments

Segments are subgroups of individuals who exhibit similar characteristics or have

common needs. By utilizing Consumer Traits and Online Behaviour variables, we were
able to segment the online consumer population effectively, as these variables
provided measurable and relevant criteria for categorization.

To ensure the applicability of our findings, we focused on a specific population that

utilizes the Internet for online shopping. Considering constraints in terms of time and
resources, we gathered data from a sample size of 103 respondents, comprising both
students and employees from India.

5.2 Sample

To ensure the applicability of our findings, we targeted a specific population that

regularly uses the Internet for online shopping. Considering the constraints of time and
resources, we identified our sample population as students and employees from India.

27
The sample size comprised 103 respondents, allowing us to draw meaningful
conclusions from the data collected.

5.3 Convenience Sampling

To select our sample, we adopted a non-probability convenience sampling method.

This involved selecting participants based on convenience and availability until we
achieved the desired sample size. While this approach may introduce some bias and
limit the generalizability of our findings to the wider population, we anticipate that the
student population, in particular, exhibits limited variation, making it acceptable to
generalize our results within this context.

5.4 The Questionnaire

To design the questionnaire, we determined the main variables for investigation,

including Demographics, Webographics, Online Shopping Patterns, Attitude towards
Online Shopping, Social Characteristics, Reference Groups, and the factors of Price,
Trust, and Convenience.

The questionnaire used in our study was self-administered and employed the delivery
and collection method. This method was chosen due to the constraints we faced in
terms of time and available resources. We designed the questionnaire to include
various types of questions, including those related to opinions, behavior, and attributes.
Closed-ended questions, such as lists, categories, rankings, quantities, and ratings,
were utilized to ensure consistency in data collection and facilitate subsequent
analysis.

For rating questions, we implemented a seven-point Likert-style scale. This scale

allowed respondents to indicate their attitudes and perceptions regarding Price, Trust,
and Convenience. Specifically, to measure attitudes towards these factors, we utilized
a bipolar semantic differential rating scale ranging from -3 to +3. Multiplying the values
obtained from this scale provided us with an overall score ranging from -9 to +9 for
each question, enabling a comprehensive analysis of the data.

The initial section of the questionnaire focused on collecting demographic information

from the respondents. These background questions encompassed categories such as
gender, semester, and income, while a quantity question allowed respondents to
provide their age.

28
These demographic details played a crucial role in categorizing respondents and
forming distinct segments within the sample population, facilitating a deeper analysis
of the data collected.

5.5 Reliability

Reliability is a critical aspect of data collection techniques, ensuring consistent findings

and the potential for other researchers to replicate the observations. It also relies on
transparency in the process of deriving meaning from raw data (Saunders et al., 2007).
In terms of surveys, reliability involves the ability to withstand random errors. Robson
(as cited in Saunders et al., 2007) identifies four potential threats to reliability:

Subject/Participant error: This occurs when respondents' moods or states influence

their responses. For example, opinions expressed on a "high" (e.g., before the
weekend) might be overly positive, while responses on a "low" (e.g., Monday morning)
could be more negative.

1. Subject/Participant bias: This bias arises when respondents answer based on

their perception of what their superiors or authorities want to hear rather than
expressing their genuine viewpoints. Fear of consequences may lead to biased
responses aligned with perceived expectations.
2. Observer error: Observer error happens when data collectors deviate from the
intended data collection process, introducing errors that can impact the final
research outcomes.
3. Observer bias: This bias occurs when the observer interprets responses based
on their own beliefs and values, leading to biased representations of respondent’s
true answers.

To mitigate these threats, certain measures can be taken like:

- Employing a highly structured questionnaire minimizes observer error.

- Ensuring anonymity encourages respondents to provide truthful answers,

reducing bias.

- Additionally, selecting a neutral day, such as a Tuesday, for survey administration

can help minimize the impact of subject/participant error.

29
5.6 Validity

Validity is another important consideration, reflecting the extent to which the chosen
data collection methods accurately measure the intended constructs (Saunders et al.,
2007). In quantitative research, validity is achieved when the measured values
correspond closely to the real values, indicating precision in measurement
(Christensen et al., 2001).

To enhance validity, it is crucial to formulate clear and unambiguous questions that

allow for undisputed interpretation and provide the desired information. However, there
is always a degree of uncertainty regarding respondents' interpretation of questions,
and it is necessary to give them the benefit of the doubt.

5.7 Generalizability

Generalizability refers to the extent to which research findings can be applied to other
settings or populations (Saunders et al., 2007). In the context of our study, focusing on
a specific group such as students limits the generalizability of the results. Since
students represent only a small portion of the Indian population, the findings can only
be generalized, if at all, to similar student populations.

30
6 Results

6.1 Introduction

The questionnaire was created to gather primary data directly from the respondents
regarding their opinions on the importance of price, trust, and convenience when
shopping online. It served two purposes: first, to identify different segments among the
respondents, and second, to gather information about the factors of price, trust, and
convenience.

The questions in the questionnaire were developed based on existing literature on

consumer behavior and the factors influencing online purchasing decisions. Questions
aimed at identifying respondent segments were derived from previous research on
consumer behavior, while questions about price, trust, and convenience were informed
by the existing literature on online shopping factors.

To ensure data integrity and avoid duplications, I emailed the questionnaire link to each
respondent and collected their emails for reference. The desired sample size was over
200 respondents, and I successfully collected responses from 226 individuals.

To analyze the collected data, SPSS software program was utilized. In the following
sections, I will present and discuss the results obtained from the questionnaire.

6.2 Questionnaire – Collected Data

6.2.1 Online Consumer Traits

The demographic information collected through questions 1.1, 1.2, 1.3, and 1.4 was
aimed at establishing the profile of the survey respondents. These questions sought to
gather information about the respondent’s - Gender, Age, Semester at the
University, and Income.

Here are the findings and results to each trait according to the survey response:

• Gender

One of the reasons for including the gender question was to examine if there were any
differences in beliefs and attitudes towards the factors (price, trust, and convenience)
between men and women. By analyzing the responses from both genders, we could
explore potential variations in their perceptions.

31
 Question 1.1 - Distribution according to the variable “Gender”

Sex Frequency Percent Cumulative Percent

Male 58 56.31% 56.31%
Female 44 42.72% 99.03%
Others 1 0.97% 100.00%
Total 103 100.00%

The distribution of male and female respondents shows a majority of male respondents
(57%), compared to the female respondents (42%).

Others
Gender 1%

Female
42% Male
57%

Male Female Others

• Age

The inclusion of age in the survey was intended to explore any potential relationship
between age and the impact of the factors (price, trust, and convenience) on consumer
behavior. By collecting information about the respondents' exact age, rather than
providing predefined age groups to choose from, we obtained more precise data that
allowed for the creation of age-based segments.

Age is a significant demographic variable that can provide insights into various aspects
of consumer behavior. Additionally, it can be utilized to further analyze and interpret
the responses to other survey questions aimed at identifying segments among the
respondents. By obtaining the exact age of each respondent, we were able to analyze
the distribution and subsequently establish different age groups based on the data.

32
This approach enables a more comprehensive understanding of how age influences
beliefs, attitudes, and behaviors related to the factors of interest.

Question 1.2 Distribution according to the variable - “Age”

Age in Years Frequency Percent Cumulative Percent

<=20 17 16.50% 16.50%
21–25 77 74.76% 91.26%
25-33 5 4.85% 96.12%
34-41 1 0.97% 97.09%
42>= 3 2.91% 100.00%
Total 103 100.00%

Age
42 >=

34 - 41

25 - 33

21 – 25

<= 20

0 10 20 30 40 50 60 70 80

Age

It was observed that the age group of 18 to 25 was more dominant in regards to internet
usage with 70+ percentage on the stats.

• Area

The region or the part of geography of a consumer also affects the usage of internet
shopping thing. There happens to be a very few people who are aware about the thing
of how the world of online shopping works and many are such who even if are aware,
they don’t trust the process with regards to payment and delivery services.

33
 Question 1.3 Distribution according to the variable - “Area”

Area Frequency Percent Cumulative Percent

Rural 25 24.27% 24.27%

Urban 78 75.73% 100.00%

Total 103 100.00%

Geographical Distribution

Rural
23%

Urban
77%

Rural Urban

• Occupation

The graph presented aims to provide insight into the occupations of the respondents
and their online purchasing behavior. By examining this data, we can determine which
segment of people, such as students, government employees, or professionals, are
more inclined to buy products on the internet. According to the graph, it indicates that
a significant majority of students, specifically 90%, are actively using the internet for
online shopping purposes.

34
 Question 1.4 Distribution according to the variable - “Occupation”

Occupation Frequency Percent Cumulative Percent

Student 70 67.96% 67.96%
Professional 24 23.30% 91.26%
Govt. Employee 5 4.85% 96.12%
Self Employed 3 2.91% 99.03%
Others 1 0.97% 100.00%
Total 103 100.00%

Self Employed
Govt. Employee 3% Other Occupution
3% 1%

Professional
24%

Student
69%

Student Professional Govt. Employee Self Employed Other

• Internet Connection

The presented graph illustrates the percentage of respondents who possess personal

internet connections. It reveals that 87.13% of the participants have their own internet

connections, while approximately 35% of the respondents do not possess internet

connectivity.

35
 Internet
Frequency Percent Cumulative Percent
Connection
Yes 88 85.44% 85.44%
No 15 14.56% 100.00%
Total 103 100.00%

Internet Connection
No
13%

Yes
87%

Yes No

• Online Shopping

This graph shows us the percentage of respondents who have done Online Shopping,
its shows that 68.93% of respondents have done Online Shopping and 31.7%people
haven’t done do Online Shopping

Online
Frequency Percent Cumulative Percent
Shopping
Yes 71 68.93% 68.93%
No 32 31.07% 100.00%
Total 103 100.00%

36
 Online Shopping

No
31%

Yes
69%

Yes No

• Motivation

This graph shows us what motivates people to buy from internet ,as from above

result I found out that no travel to shop is the main thing which motivates the people

to buy products online.

Question 2.1 – Distribution according to the variable - “Motivation”

Motivation Frequency Percent Cumulative Percent

Easy Payment 21 29.58% 29.58%

No Hidden cost 6 8.45% 38.03%

Wide range of
22 30.99% 69.01%
products

No travel to shop 22 30.99% 100.00%

Total 71 100.00%

37
 Motivation

No travel to shop Easy Payment

31% 30%

Wide range of
products
32% No Hidden cost
7%

Easy Payment No Hidden cost Wide range of products No travel to shop

• Competitive Prices

This diagram shows us that whether online marketers are giving competitive price or

not and result which is came is that most of the people thought that online marketers

are providing competitive prices than physical stores. And results 74.65% of people

say that it provides competitive prices and only 14.08% people says no.

Question 2.2 Distribution according to the variable - “Competitive Prices”

Competitive Prices Frequency Percent Cumulative Percent

Yes 53 74.65% 74.65%

No 10 14.08% 88.73%
Can’t Say 8 11.27% 100.00%
Total 71 100.00%

38
 Competitive Prices
Can’t say
10%

No
14%

Yes
76%

Yes No Can’t say

• Online Shopping

Based on the above graphs, the data indicates that online purchasing is the most

popular activity among the respondents, with a significant percentage of 36% engaging

in online shopping. However, the margin between online shopping and other activities

is relatively smaller. For instance, purchasing music CDs has a save percentage of

15%, while personal and healthcare products also account for 15% of the respondents'

online buying preferences.

Online Shopping
Personal and Healthcare 15

Mobiles and Acessories 34

Clothing 21

Music CD's 15

Books 36

0 5 10 15 20 25 30 35 40

Products buy Online

39
• Frequently visited online stores

According to the graph, 57% of the respondents prefer to visit Flipkart for their online
shopping needs. Additionally, 31% of the participants opt to go to eBay, while 17% of
the individuals choose Amazon as their preferred online shopping platform. The
remaining percentage of respondents explores other options, such as visiting Best Buy
and other online retailers, for their online shopping requirements.

Online Stores
Other 7

Myntra 13

letsbuy 6

Flipkart 57

Amazon 17

e-bay 31

0 10 20 30 40 50 60

Online stores

• Factors that help to decide where to shop online

The provided diagram illustrates the factors that influence people to make online

purchases. It reveals that 21% of individuals become aware of shopping sites through

search engines, which subsequently attracts them to explore and make purchases

from those sites. Furthermore, 20% of people's decisions are influenced by special

offers and discounts provided by the online shopping platforms. These enticing offers

lay a significant role in attracting and encouraging individuals to engage in online

shopping.

40
 Factors helping to decide where to shop online

Tv advertising 4

Online Advertising 12

Special Offers On Sites 20

Personal Recommendation 14

Search Engine 21

0 5 10 15 20 25

• Way of Payment

The provided diagram presents the preferred payment methods used by individuals for

their online transactions. It indicates that a majority of people, accounting for 42%,

choose to pay using credit or debit cards. Additionally, 14% of individuals opt for cash

on delivery as their payment method, while 11% utilize internet banking for their

transactions. Furthermore, 3% of people prefer to make payments through PayPal.

Way of payment

Cash-on-Delivery 14

GoogleWallet 1

Paypal 3

Internet banking 11

Debit/ credit card 42

0 10 20 30 40 50

Way of payment

41
• Frequency of Online Shopping

Frequency of Online shopping

Twice a week
4%
Twice a month
16%

once a week
8%

once a month
72%

once a month once a week Twice a month Twice a week

6.2.2 Attitudes and Beliefs

• Prior Experience

This question was used in order to see what attitude the respondent had about
shopping online. The measured attitude was mainly derived through questions about
the respondent’s prior experiences. This usually also affects the attitude towards
performing an action, in this case the action was to shop online. The question was,
therefore designed to let the respondent rate their prior experience for shopping online.

Question 4.1 Distribution according to the variable -

‘Previous experience with online purchases’

Experience Frequency Percent Cumulative Percent

1 (Very Bad) 0 0.00% 0.00%

2 1 1.41% 1.41%

3 24 33.80% 35.21%

4 33 46.48% 81.69%

5 (Very Good) 13 18.31% 100.00%

Total 71 100.00%

42
 Prior Experience

0,
1, 0%
1%
13, 18%
24, 34% 1 (Very Bad)
2
3
33, 47% 4
5(Very Good)

Overall, the respondents showed a good to very good prior experience with purchasing

online. The number of respondents with a very good attitude towards online shopping

is high and the distributed attitude declines as less respondents think of it as a bad

experience. Rating number four on the scale is considered as neither a good nor bad

experience. The majority of respondents that is 35.87%, do consider their prior

experience with online purchasing as neither good nor bad. This question is closely

related to the following question which investigates the respondents’ future

expectations of online purchasing.

• Future Expectations of Online Purchase

This question is a part of analyzing the respondents’ attitude towards online purchases.
Future expectations are highly dependent on respondents’ prior experiences of online
purchases; this will be further discussed in the analysis of the results.

As with prior experiences the respondents have a highly positive attitude towards
future online purchases. The majority (41.38%), of the respondents have rated future
expectations with online purchases to be positive. Not considering the neutral
respondents; an overall 80.9% of the respondents had positive expectations.

43
 Question 4.1 - Distribution according to the variable –
‘Future experience with online purchases’

Cumulative
Experience Frequency Percent
Percent
1 (Very Bad) 0 0.00% 0.00%
2 1 1.41% 1.41%
3 11 15.49% 16.90%
4 24 33.80% 50.70%
5 (Very Good) 35 49.30% 100.00%
Total 71 100.00%

Future Expectations
1, 1%

11, 16%
1 (Very Bad)
35, 49% 2

24, 34% 3
4
5(Very Good)

• Impact of Reference Groups

Questions - 5.1, 5.2, and 5.3

The impact of Reference Groups These questions were designed to find out which of
the three Reference Groups, family, friends, and online forum, that have an impact on
the respondent. Families as Reference Groups have not shown to have an impact on
online purchases among students. A majority of 32.39% do not consider any of their
families’ opinions and experiences at all when purchasing online.

44
 Question 5.1 - Distribution according to the variable –
‘How much does family affect online purchase’

Family affect Frequency Percent Cumulative Percent

1 (Not at all) 11 15.49% 15.49%
2 15 21.13% 36.62%
3 23 32.39% 69.01%
4 13 18.31% 87.32%
5 (Very Much) 9 12.68% 100.00%
Total 71 100.00%

Family affect

9, 13% 11, 16% 1 (Not at all)

13, 18% 2
15, 21% 3
4
23, 32% 5(Very Much)

Friends as a Reference Groups have shown to have a bigger impact as a Reference

Groups when respondents consider their purchases online. This can be explained by
the fact that friends often are fellow students that attend the same program and have
relevant information that is of use to the respondent. The distribution of the
respondents shows that the majority of the respondents, 33.8%, take the opinions and
experiences of their friends into consideration.

45
 Question 5.1 Distribution according to the variable –
“How much does friends affect online purchase”

Friends Effect Frequency Percent Cumulative Percent

1 (Not at all) 8 11.27% 11.27%

2 10 14.08% 25.35%

3 13 18.31% 43.66%

4 24 33.80% 77.46%

5 (Very Much) 16 22.54% 100.00%

Total 71 100.00%

Friends affect

8, 11%
16, 23%
1 (Not at all)
10, 14%
2
3
13, 18%
24, 34% 4
5(Very Much)

46
6.2.3 Online Consumer Behaviour
Question - 2.1

• Time spent online

This question aims to explore the amount of time respondents spend online, which can
provide insights into their level of experience with the internet. The literature suggests
that individuals who spend more time online tend to have a higher level of internet
experience, which can influence their online shopping patterns. Therefore, this
question is closely linked to understanding the respondents' shopping behaviors and
will be further discussed and analyzed to examine the relationship between time spent
online and their online purchasing patterns.

Question - 2.1 – Distribution according to the variable ‘Time Spent Online”

Time Spent Online Frequency Percent Cumulative Percent

<30 8 11.27% 11.27%
1-2 20 28.17% 39.44%
2-5 19 26.76% 66.20%
>5 24 33.80% 100.00%
Total 71 100.00%

Time spent

< 30
>5 11%
34% 1 - 2 hours < 30
28% 1 - 2 hours
2 - 5 hours
2 - 5 hours
27% >5

47
The distribution of respondents reveals that the majority of them spend a significant
amount of time online each day, ranging from 30 minutes to 2 hours.

The second major groups consist of respondents who spend 5 hours and those who
spend more than 2 to 4 hours online daily, accounting for 34% and 27% respectively.
These findings are valuable for examining the differences between these groups and
determining the impact of factors such as price, trust, and convenience.

By analyzing the responses of these two groups, researchers can identify the varying
factors that influence their online shopping behaviors. The goal is to determine which
factor, whether it is price, trust, or convenience, has the greatest impact on their
decision-making process.

This analysis can provide insights into the key drivers behind their online shopping
habits and help businesses understand how to tailor their strategies to meet the
needs and preferences of these distinct groups of respondents.

• Internet Usage

The purpose of including this question was to investigate the primary reasons why
respondents mainly use the internet. In this question, respondents were presented with
five alternatives and asked to rank their primary, secondary, and tertiary choices of
internet usage.

Question 2.1 – Distribution according to the variable ‘Time spent Shopping online”

Percentage of time spent on shopping Frequency Percent Cumulative Percent

<20% 40 56.34% 56.34%

20–40% 23 32.39% 88.73%
40–60% 2 2.82% 91.55%
>60% 6 8.45% 100.00%
Total 71 100.00%

48
By analyzing their responses, we can gain insights into the main motivations behind

their internet usage patterns and understand which purposes are prioritized by the

majority of the respondents.

Question 2.2 – Distribution according to the variables - “Primary, Secondary and Territory use.

Internet Usage Primary Usage Secondary Usage Territory Usage

Fun 11(15.49%) 9(12.67%) 14(19.71%)
Work 21(29.58%) 16(22.54%) 9(12.67%)
Information 21(29.58%) 13(18.30%) 16(22.54%)
E-Mail 16(22.54%) 29(40.84%) 12(16.90%)
Shopping 2(2.82%) 4(5.63%) 20(28.17%)
Total 71 71 71

Based on Table 5.15, the respondents ranked their primary most popular uses of the
internet as Work (29.58%), Information (29.58%), and Email (22.54%). For the
secondary overall most popular choices, Email (40.84%), Work (22.54%), and
Information (18.30%) were the preferred alternatives. As for the tertiary most popular
choices, Shopping (28.17%), Information (22.54%), and Fun (19.71%) were ranked
highest.

The distribution reveals that the alternatives Fun, Email, and Information were the most
popular choices overall, except for Fun, which was primarily replaced with Work as a
tertiary use. These findings provide insights into the primary, secondary, and tertiary
purposes for which respondents use the internet, highlighting the importance of work-
related tasks, information-seeking, email communication, shopping activities, and
recreational purposes.

7 Analysis

7.1 The Factors

In order to gain an initial understanding of how the respondent feels towards Price,
Trust and Convenience, they were asked to rank these in the questionnaire
accordingly. I have then investigated the different attributes of the factors.

49
When the respondent was asked to just rank the different factors, the results showed
that 73.9% considered price as the primary concern when purchasing online. When
the respondent was put in front of the three factors, I could see that most of them chose
price. However, if compared to the Primary Factor, where the different attributes to the
factors were used to find the overall attitude and importance; the results did not match.
The distributions for the Primary Fact or were Price: 41.6%, Trust:30.1% and
Convenience: 28.3%. This showed that the respondent generally thought that Price
was the most important to him or her, but at the same time one of the other factors
could actually be the most important to a respondent, since the distribution shifted
between the two ways of evaluating, with the Primary Factor being the most accurate
since it offers an overall attitude measurement. This answers the questions one and
two in our research.

7.2 Two Step Cluster

The two-step cluster analysis was used to segment the respondents. This type of
analysis grouped data so that records within a group were similar. It could be applied
to data that described customer buying habits, gender, age, income etc. It created
segments containing groups that had the most in common and this method was
selected due to the number of variables that needed to be taken into consideration
when creating the segments.

By analysing the collected data, for the various variables that I intended to segment
by, I decided to exclude some variables. There as on was that some of the variables
did not show a significant variation which would have enhanced the homogeneity of
the segments. Segments need to be homogenous and diverse from the whole
population in order for them to be targeted. The variables that I did not use would
instead be applied to give an additional explanation to the formed segments. With the
two-step cluster analysis, I found three segments in our sample, based on the variables
that I chose to segment by, which were: Expenditure on an average each month,
Previous experience with purchasing online, Future expectations with purchasing
online, The impact of the reference group: family, The impact of the reference group:
friends, and The impact of the reference group: online forums. In this research the
variables are categorized into the following variables shown by Figure 6.1.

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Consumer Traits: Impact of Reference Groups (Family, Friends, and, Online forums),
and Attitude and Beliefs (Previous experience and Future expectations)

Attitude and
Belifs
Consumer Traits
Impact of
reference
Online Consumer
Groups
Segments

Online Shopping
Online Behaviour
patterns

Segment variables

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8 Conclusion

The research conducted in this study provides valuable insights into online consumer
behaviour. However, there are several avenues for future research that could further
enhance our understanding of the topic. These include:

• Conducting surveys at different universities or institutions to verify the

generalizability of the results. If similar findings emerge across different settings,
it would strengthen the validity and applicability of the conclusions.
• Expanding the sample size to include a broader range of participants beyond
students, allowing for segmentation and analysis based on different
demographics. This would provide a more comprehensive understanding of
online shopping patterns across various consumer groups.
• Shifting the focus of the research towards online retailers to explore their
strategies, challenges, and customer-centric approaches. This would provide
insights into how online retailers can optimize factors such as price, trust, and
convenience to attract and retain customers.
• Investigating whether there are discrepancies in the perception of price, trust, and
convenience among different consumer groups. Understanding if certain factors
hold varying degrees of importance for different segments would enable targeted
marketing and customized strategies.
• Exploring the applicability of the identified factors (price, trust, and convenience)
in other online trading contexts, beyond the scope of this study. This could involve
studying a wider range of goods or specific industries to uncover unique insights
and tailor strategies accordingly.

The future research endeavours could build upon this study's findings by expanding
the scope, exploring different perspectives, and examining the factors in various
contexts, ultimately providing a more comprehensive understanding of online
consumer behaviour.

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In conclusion, the future of online shopping is poised for significant growth and
transformation in response to evolving consumer behaviour. With the increasing
convenience, accessibility, and personalized experiences offered by online platforms,
consumers are expected to continue embracing digital channels for their shopping
needs.

As technology advances, we can anticipate further integration of artificial intelligence,

augmented reality, and virtual reality to enhance the online shopping experience.
Personalized recommendations, interactive product demonstrations, and virtual try-on
options will become more commonplace, providing consumers with a seamless and
engaging journey.

Moreover, the rise of mobile devices and the growing adoption of smart assistants will
further facilitate online shopping on-the-go. With just a few taps or voice commands,
consumers will have access to a vast array of products and services, making the
process more efficient and effortless.

In terms of consumer behaviour, we anticipate a stronger focus on sustainability and

ethical considerations. Conscious consumerism will drive the demand for eco-friendly
products, transparent supply chains, and socially responsible brands. Online retailers
that align with these values and effectively communicate their commitments will likely
gain a competitive edge.

However, it is important to note that while online shopping continues to flourish,

traditional brick-and-mortar stores will not become obsolete. There will always be a
segment of consumers who prefer the tangible experience of physical retail spaces.
Therefore, a hybrid approach that seamlessly integrates both online and offline
channels will be crucial for retailers to cater to the diverse needs and preferences of
consumers.

In summary, the future of online shopping looks promising as consumers increasingly

embrace the convenience, personalization, and accessibility it offers. With continued
advancements in technology and a shift towards conscious consumerism, online
retailers must adapt and innovate to provide seamless experiences that meet evolving
expectations. By leveraging these trends and finding the right balance between online
and offline retail, businesses can position themselves for success in the near future.

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9 References

• Upasana Kanchan et al.: A Study of Online Purchase Behaviour of Customers

in India - IJMS_V1_I3_Paper_4_136_142
https://www.researchgate.net/publication/306382997_A_STUDY_OF_ONLINE
_PURCHASE_BEHAVIOUR_OF_CUSTOMERS_IN_INDIA
• Jayendra Sinha (USA), Jiyeon Kim (USA) - Factors affecting Indian consumers’
online buying behaviour. –
https://www.businessperspectives.org/images/pdf/applications/publishing/temp
lates/article/assets/4625/im_en_2012_02_Sinha.pdf
• International Journal of Development Research - Consumer behaviour in online
market: Indian context - https://www.journalijdr.com/consumer-behaviour-
online-market-indian-context
• The Impact of Online Reviews on Consumers’ Purchasing Decisions: Evidence
From an Eye-Tracking Study –
https://www.frontiersin.org/articles/10.3389/fpsyg.2022.865702/full
• Conceptualizing consumer “trust” in online buying behaviour: an empirical
inquiry and model development in Indian context – Emerald Insights
• The Impact of Social Media on Online Purchasing / Behaviour of Consumers:
An Empirical Study of Youth in West Bengal, India - https://majcafe.com/wp-
content/uploads/2022/11/Vol-26-2021-Paper-3.pdf
• Analysis of Impulse Buying Behaviour of Consumer During COVID-19: An
Empirical Study
https://journals.sagepub.com/doi/full/10.1177/09763996211041215
• A Comparative Study on Consumer’s Perception Towards Online Shopping
Over Traditional Mode of Shopping - Dr. Vikas Shankarlal Varma -
https://ijcrt.org/papers/IJCRT2210350.pdf

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