Customer Online Shopping Behaviour

The internet has revolutionized businesses, economies and societies all over the globe. It is constantly unleashing new business models, creating new products and services, changing the way consumers shop and businesses sell their products. The increasing number of Internet users every year indicates increased awareness of Internet’s benefits for the people across the world. As Internet is becoming more widely used and is playing a very significant role in every sector of human life, for example in studies, in business, entertainment, social life and also in online shopping, the internet brought a revolution in the human life, it is very helpful in every sector. Online shopping is also growing tremendously. As many businesses are attempting to globalize their sales, Internet becomes the primary means of advertising and selling their products or services worldwide. Many businesses are creating web pages in addition to their retail stores, and many start their businesses with online stores alone. Online store is the number one remote shopping method that consumers use nowadays. Shopping online offers lots of benefits that you won’t find shopping in a store or by mail. The internet is always open – seven days a week, 24 hours a day – and bargains can be numerous online. With a click of a mouse, you can buy an airline ticket, book a hotel, send flowers to a friend, or purchase your favorite fashions. But sizing up your finds on the internet is a little different from checking out items at the mall. Internet is changing the consumer behaviour toward online shopping too because it is easy and consumers can get huge range of variety and can compare the prices easily and it is convenient too. Online shopping is getting famous ever than before and it’s making a great space in the consumer market, and because of this more consumers attracting toward online shopping everyday all around the world. According to Imrg Report in 2007 online shoppers from United Kingdom spent more than 46.6 billion pounds in shopping. This makes UK the No 1 leading country in the Europe for online shopping (IMRG 2008). And According to 5 year forecast by 2011 32 million internet users will be shopping online, and the spending they expecting to grow 52 billion pounds (Forrester UK e-commerce forecast). It means UK Online market is growing very fast as compare to Pakistani online Market. A Survey carried out by Global Nielsen shows that 97% of UK internet users have shopped online, and on the other end 60% of Pakistani internet users never shopped online (A global Nielsen Consumer report 2008). It is a huge difference. The population of Pakistan is 171 million (national population policy 2010). And population in UK is 61.4 million (office for national statistics 2010). If we see from this online market point of view Pakistan is one of the potential market in the world by looking at the current population of the country. However there are some major elements which do not allow Pakistan to progress further in this market. Even though majority of Pakistanis live in the cities and they have more awareness about internet than people living in remote areas, people in Pakistan are well aware about internet use, and most of them are students and youngsters, they have more awareness about internet use than any other age group. From the previous research which has been done in this topic main concern was about security of internet shoppers.

2: Problem statement

Online shopping in Pakistan is not growing well as it should do as compare to other countries. Pakistan is a potential online market, which should improve like other countries, most of the Pakistani population living in cities and they are more aware about internet use, but still why it is not growing fast. Like other countries Pakistan also have many online shopping sites like emarkaz, galaxy, beliscity and myshop. But looks like the Pakistani consumers are more interested to do window shopping rather than online shopping. Pakistan’s online market should grow faster and should become one of the largest market in the world. Online shopping sites are trying to aware to the people of Pakistan about benefits of online shopping as the online shopping in Pakistan has been shown to a good potential market. Online shopping can add great convenience to the life of the people. Buying goods online gives customers an opportunity to find a great variety of product online, and customers can review a wide selection of products and find special offers and discount with the best deals online. In the coming years, the development of online retailers is improving and promises a bright future. However, the tangible and intangible problems of online shopping still exist and the online store retailers lack the customer knowledge in some extent. Therefore, our intention is to explore customer behavior when purchasing products through investigating the factors that can affect online shoppers‟ attitudes, intention and actual buying behavior. Furthermore, through the findings of our research, we offered the online retailers some suggestions to improve their sales and attract more customers.

It is important to take the customers behavior into account, experienced users focus more on the variables that directly influence the task, while novice users are focusing more on understanding the information. There are several techniques for the inspection of the usability. Every technique has its own advantages and it is therefore important to check per situation which technique is appropriate.

When the customers went to the online shop, a couple of factors determine whether they will return to the site. The most important factors are the ease of use and the presence of user-friendly features.

3: Aims

The aims are to try to find a possible solution to divert Pakistani people behaviour toward online shopping, and improve Pakistani online market growth. The main objectives of current research are:

To analyze why the Pakistan’s university level students do not feel comfortable with online shopping.

What are the major issues with Pakistan’s online shopping market.

And what are the possible solutions to improve Pakistan online shopping market.

Some of basic reasons for not shopping online are as follows:-

People are use to with retail shopping

Many enjoy shopping with others and it is often a good way to make social connections. When shopping independently online, the enjoyment is lost.

Privacy and security issues

Privacy is the number one reason that non-online shoppers do not shop online. Almost 95% of Web users have declined to provide personal information to Web sites at one time or another when asked (Hoffman, Novak, & Peralta, 1999). Another recent study has found that privacy was the top concern of customers while security ranked bottom (Schaupp & Belanger, 2005). This proves that many do not trust the privacy of the Internet and are concerned with their credit card frauds, unwanted solicitation, and use of their information for other purposes. Security of Web sites is not the top concern because many shop on Web sites that they trust so that other factors appear to be more important than security.

Access to the Internet and computer necessary

Because one needs money to buy a computer and to have internet connection, online shopping seems to be limited people of reasonable amount of income. Also, since it is harder to learn computer at an older age, the elderly people tend shop at traditional retail stores.

Product category risk

Product category risk is related to functional products such as apparel, perfume, and electronics, that have functions that cannot fully be expeirenced online. Online shopper are worried that the products will not be what they have expected by viewing online. This is a clear disadvantage of onlins shopping because it shows that “[t]he likelihood of purchasing on the Internet decreases with increases in product risk” (Bhatnagar, Misra, & Rao, 20000, p. 100). Apparels in particular had negative rating in online shopping because of it is difficult to feel and see the texture of colour online that is incomparable to going to a retail store, even with magnifying tools online. Also, one cannot try on clothing before buying it online, so it would be very inconvenient if the size did not fit the person and he/she had to return it.

Too many choices

Although having access to a very large number of products is highly desirable, consumers have limited cognitive resources and may simply be unable to process the potentially vast amounts of information about these alternatives (Haubl & Trifts, 2000). Online stores need to provide the variety in an organized way that will facilitate shopping online.

Possible Solutions to improve Pakistan online shopping market.

Consumer expectations

The main idea of online shopping is not in having a good looking website that could be listed in a lot of search engines and it is not about the art behind the site. It also is not only just about disseminating information, because it is all about building relationships and making money. Mostly, organizations try to adopt techniques of online shopping without understanding these techniques and/or without a sound business model. Rather than supporting the organization’s culture and brand name, the website should satisfy consumer’s expectations. A majority of consumers choose online shopping for faster and more efficient shopping experience. Many researchers notify that the uniqueness of the web has dissolved and the need for the design, which will be user centered, is very important. Companies should always remember that there are certain things, such as understanding the customer’s wants and needs, living up to promises, never go out of style, because they give reason to come back. And the reason will stay if consumers always get what they expect. Day by day online shopping is becoming more and more popular and website that wants to gain more shoppers.

Organizations, which want people to shop more online for them, should consume extensive amounts of time and money to define, design, develop, test, implement, and maintain website. Also if company wants their website to be popular among online shoppers it should leave the user with a positive impression about the organization, so consumers can get an impression that the company cares about them. The organization that wants to be acceptable in online shopping needs to remember, that it is easier to lose a customer then to gain one. Lots of researchers state that even when site was a “top-rated”, it would go nowhere if the organization failed to live up to common etiquette, such as returning e-mails in a timely fashion, notifying customers of problems, being honest, and being good stewards of the customers’ data. Organizations that want to keep their customers or gain new ones try to get rid of all mistakes and be more appealing to be more desirable for online shoppers. And this is why many designers of webshops considered research outcomes concerning consumer expectations.

Enjoyment of retail shopping lost – Online shopping can be fun

A study has found that many people find enjoyment and freedom through shopping online and like to browse through even if they do not have a goal-oriented shopping item on mind (Wolfinbarger). One such factor is user-friendly interface that make shopping enjoyable and visually pleasant. To solve the problem of the lost social interactivity, consumers can engage in other meaningful activiteis such as partying, dining, sports activities, etc. Even though the enjoyment attained from online shopping is uncomparable to the one by social interactions, some of it can be compensated by the enjoyment of shopping online and participating in other activities.

Privacy and security issues – Third-party seal

This is a very important issue because studies have found that “consumers who perceive fewer risks or concerns toward online shopping are expected to maker more online purchases than more risk-laden consumers (Miyazaki & Fernandez, 2001, p. 31). Although it is possible to invade one’s privacy online, no significant amount of statistical results relating to the victims who have been invaded, has been found. Many are simply concerned and mistrust online stores. What online stores need is the mechanism that signals security of financial transactions on the Web. One possible solution is to require web site makers to provide a third-party seal approval that signal privacy and security on their web sites. Thus when consumers see the seal, they can trust the Web site and not worry about invasion of their privacy. Moreover, all companies will desire to keep frauds away in order to build company reputation and to survive in the competitive online market. Once they build consumer trust, online shoppers will not be discouraged to shop on their Web sites.

Access to the Internet and computer necessary – growing use of computers

Internet access has been available in Pakistan since the mid-1990s. PCTL started offering access via the nationwide local call network in 1995. By early 2006 Internet penetration remained low. There were signs that this was changing, however. The country has been pursuing an aggressive IT policy, aimed at boosting Pakistan’s drive for economic modernisation and creating an exportable software industry. There is no doubt that has been helping increase the popularity of the Internet. The market certainly has huge potential, by 2009, however, Internet penetration remained high and broadband growth had also been increased. There was some good news on this front when the year 2008 saw an upsurge in broadband subscriptions; importantly, this looked to be continuing in 2009, boosted by the spread of competition throughout the market. DSL subscriptions were dominating the broadband market, quite overshadowing the cable modem broadband services provided using HFC infrastructure.

In the meantime, early signs of wireless-based broadband Internet technologies had begun to appear and by 2008 there were a number of WiMAX networks being rolled out in the larger urban centres. For the time being, however, the number of wireless broadband subscribers remains relatively small.

Product category risk – 3D technology

Apparel online shopping has a lot of room for improvement. Although it is not yet widely used, many online shop creaters are developing 3D technologies to use for online shopping. Companies such as E-Tailor, is developing customized fitting room for consumers to build their own body online that will allow them to try on as many clothings as possible. A university in Switzerland is developing a more powerful try-on application that will allow their customers to apply multiple layers of clothes. To avoid the slow downloading time of 3D graphics, they are moving the cloth and skin animaiton to the client side, using program such as ActiveX that is downloaded automatically at the first access tot he Web page (Cordier, Seo, & Magnenat-Thalmannm, 2003). To See full article go to: http://tclab.kaist.ac.kr/~fcordier/Home_files/Papers/ Made-to-Measure_Technologies_for_Online_ Clothing_Store.pdf

Simlarly, E-Tailor is designing a program that will allow animation of scanned customer bodies in the virtual fitting room (Kartsounis, Magnenat-Thalmann, & Rodrian).

These sites allow you to view the 3D technology:

http://www.cyberware.com

http://www.atc.gr/e-tailor

Too many choices – Interactive decision aids

Online shoppers are looking for useful functions on Web sites in addition to ease of use. More specifically, they desire to compare available products and their prices from a variety of different online stores. By providing decision aids that help decision making, Web sites can attract more online shoppers. Many choices can be confusing, but with interactive toolkits such as recommendation agent that allows consumers to view a useful set of products out of the infinite list on the Web that allows in-depth comparisons among selected items . These interactive decision aids allow consumers to make “better decision with less effort”. This allows viewers to compare different prices of one product offered by different vendors on the Internet. Thus, the toolkit allows consumers to receive the best deal possible. Although these tools are already provided by many Web sites, they can be improved by adding more features that will provide more details of products. The tool is also beneficial to the society because they keep the market prices competitive so that no one vendor can charge significantly more than others.

These sites use the CM decision aid:

http://www.pricegrabber.com

http://www.bizrate.com

http://www.dealtime.com

Additional online facilitating conditions

Transaction efficiency (such as delivery speed and providing tracking number) is also a significant condition that will satisfy consumers. Consumers expect to receive the products with high speed, and want to be able to track their purchased item to avoid any frauds while shipping.

4: Literature review

Comparsion with india and bangle desh , sri lanka

By looking at the previous studies we have found some very useful information about consumer’s online shopping behaviour, every author has done very great job in this field, because of their studies in this field it is really going to help us in this projects, some of their literature reviews are as follows.

There are also some levels of risk involved in online shopping. Online consumer cannot check physically the quality of the product and also consumer cannot monitor the safety and security when he is giving very sensitive personal and financial details while consumer doing online shopping (Lee and Turban, 2001). Education is major factor and it also plays moderating role in connection between the three main determinates and online consumers’ attitude toward internet shopping. Normally higher educated consumers feel more relaxing to use online shopping rather than shopping in high street (Burke, 2002). There are many reasons for consumers to do online shopping rather than “real world shopping”. Even the way of online shopping give benefits to change consumer’s attitude and push them to prefer online shopping, and simply they are not essentially choosing one way of shopping on another way. It depends on consumers to do shopping whenever and however it’s convenient for them, it is up to them to shop by using catalogue or store and online (Cyr, 2000). These days consumers are doing shopping by using different ways, some of them are doing in usual way like window shopping and some of them are doing online shopping. In the United States university level students are the 90 percent of the people who have got access to the internet on daily basis, and they spend $200 billion a year and they are one of major buying power of the United States market, and average of the student’s spend $287 monthly (Gardyn, 2002). It is very important for retailers and educator of consumer behaviour to keep focus and better understanding about this group, because students keep very strong power in marketplace. The major psychological factor which influenced the person’s shopping selections is four, Attitude, motivation, learning and beliefs and perception. It means Motivation and perception forms attitudes and after that consumers can make decisions. Attitudes play the role of bridge among consumers’ consumption and background characteristics and that helps their needs (Armstrong and Kotler, 2000).We found four major key dimension of internet shopping; famous web sites, design, information content, security and privacy, we found that all these dimensions have an direct impact on online shopping intention, and the main thing which have greater impact on purchasing online is security and privacy (Ranganthan and Ganapathy, 2002).

5: Stakeholders

Here is some information about stakeholders.

Started thier journey back in 1991 as Galaxy Computers. It was the time when curiosity to

learn about computers was growing slowly and gradually in Pakistan. It was also a fact that availability of good quality computer products was also a problem because vendors were also gathering information about computers along with the users.

they deal with every sort of electronic stuff and mostly they deal with computer laptops, desktop computers and other accessories and they are running the business very successfully, and this company providing online shopping service to all over the Pakistan. Interview will be conducted with client about this service and we will discuss every possible measure with them

The main purpose behind the establishment of Galaxy Computers was to educate masses

about computers and to provide them necessary quality hardware. As a matter of fact, since first day of the establishment we tried our level best to provide genuine and quality products to our customers. Galaxy Computers never compromised on quality to make profits. This is the only reason that today, Galaxy Computers is ranked among the Top Resellers all over Pakistan with its Karachi and Lahore Outlets.

Keeping in view the need of time, we always strived to introduce the latest products. As a matter of fact Galaxy Computers is not only the top ranked retailer but we are also the distributor for the products which are considered to be unique in there kind and difficult to get. Due to the availability of such products it is made possible for a common person to use and facilitate himself with the latest inventions.

Not only in Pakistan but also abroad users get themselves updated by using our website. Our Website is updated daily and it contains not only the prices of the products but also useful links and configurations by which it’s easier for the customers to choose the right product.

With respect to Product Distribution, Galaxy computer is very popular among the dealers across Pakistan. Specially in gaming and graphic products the dealers emphasize on using the world famous brands for graphic cards and memories which we import. US Robotics does not require any introduction when it comes to networking products and as a distributor for US Robotics, Galaxy Computers has made possible for common person as well as in corporate to have easy data connectivity.

After sales service is a key factor for any computer user and without a quality service even a good product leaves a bad impression. In this field we always tried our best to satisfy our user and it’s only because of our quality after sales service that the number of satisfied customers of Galaxy Computers is increasing day by day.

We use different means to communicate with our valued customers, suppliers and well wishers which includes email, phone and fax. On contact page all the details are listed through which we can be contacted.

Beliscity Online Pakistan: they will be our second client; Founded in 2001, Beliscity.com is the leading online shopping mall in Pakistan offering a huge range of products from the world’s leading manufacturers to thousands of retail and corporate customers across the globe Our customers are privileged with a quick, easy and reliable way of buying the products they want, at the most competitive prices with direct delivery to their door FREE of cost in Pakistan.

We are always in a process of adding new brands and products; expanding our online collections in order to achieve our vision that people can find and discover anything they want to buy online.

The idea behind Beliscity.com was simple, to provide customers with a quick and easy way of buying the products they want, at the most competitive prices, delivered direct to their door. We started of with a list of about 200 products most of which were IT related and currently Beliscity.com retail website now has an assortment of over 7,000 products including Perfumes, Kitchen Appliances, Watches and a whole lot more.

6: Methodology

The nature of this research is qualitative. At present, two qualitative approaches are considered to undertake this research i.e., interviews and questionnaires. In questionnaire and the interview. Questionnaires are usually paper-and-pencil instruments that the respondent completes. Interviews are completed by the interviewer based on the respondent says. Sometimes, it’s hard to tell the difference between a questionnaire and an interview. For instance, some people think that questionnaires always ask short closed-ended questions while interviews always ask broad open-ended ones. But we will use questionnaires with close-ended questions because they do tend to be shorter in interviews and there will often be a series of closed-ended questions asked in an interview. The reason to use qualitative approach on other methods is Qualitative research explores behaviour, experiences and attitude throughout such methods as focus groups and interviews. This attempts to find in-depth views from participants. As it is experiences, behaviour and attitude which are very important, fewer people take part in the research, but the contact with these people tends to last longer. Under the umbrella of qualitative research there are so many different methodologies. (Dr. Catherine Dawson). We will gather the information and data by using Interviews and questionnaire and we will try to get opinions from our client’s galaxy and beliscity online shopping and their sales department and also from Pakistani public university students. What they think about online shopping and what is the major issues with online market. Why they do not feel comfortable with online shopping. And the data we are going to collect from them will be textual and we will use closed-ended questionnaire, the reason of choosing closed-ended questionnaire is, it will not take extra time of the participants to response all the questions. A close-ended question limits candidates to choosing a particular, solid answer for examples: “How many years of experience do you have as a team leader?” “What was your GPA?” “Have you ever worked from home?”

The advantages of closed-ended questions are:

• Closed-ended questions are more easily analysed. Every answer can be given a number or value so that a statistical interpretation can be assessed. Closed-ended questions are also better suited for computer analysis. If open-ended questions are analysed quantitatively, the qualitative information is reduced to coding and answers tend to lose some of their initial meaning. Because of the simplicity of closed-ended questions, this kind of loss is not a problem.

• Closed-ended questions can be more specific, thus more likely to communicate similar meanings. Because open-ended questions allow respondents to use their own words, it is difficult to compare the meanings of the responses.

• In large-scale surveys, closed-ended questions take less time from the interviewer, the participant and the researcher, and so they are a less expensive survey method. Generally, the response rate is higher with surveys that use closed-ended question than with those that use open-ended questions.

Quick to answer

Easy to code

Allows surveyor for a direct response from the respondent

Gives control of the question and response

Allows to uncover specific information from and about the respondent

Gives full control of the direction of the survey.

Developing a focused and effective questionnaire can help to efficiently and accurately pinpoint the information to help to make more informed decisions.

Developing a questionnaire is as much an art as it is a science. And just as an artist has a variety of different colors to choose from in the palette, we have a variety of different question formats with which to question an accurate picture of customers, clients and issues that are important to them.

The Dichotomous Question

The dichotomous question is generally a “yes/no” question. An example of the dichotomous question is:

Have you ever shopped online?

Yes

No

We can also use yes/no questions to separate people or branch into groups of those who “have purchased” and those who “have not yet purchased” your products or services. Once separated, different questions can be asked of each of these groups.

The Multiple Choice Questions

The multiple-choice question consists of three or more exhaustive, mutually exclusive categories. Multiple choice questions can ask for single or multiple answers. In the following example, we could ask the respondent to select exactly one answer from the 7 possible

Example: A multiple-choice question to find out how a person first heard about our online shopping store is:

How did you first hear about our online shopping store?

Television

Radio

Newspaper

Magazine

Word-of-mouth

Internet

Other: Please Specify _______________

For this type of question it is important to consider including an “other” category because there may be other avenues by which the person first heard about your site that you might have overlooked.

Rank Order Scaling

Rank order scaling questions allow a certain set of brands or products to be ranked based upon a specific attribute or characteristic.We may request that the options be ranked based upon a particular attribute. Ties may or may not be allowed. If allow ties, several options will have the same scores.

Example:

Based upon what you have seen, heard, and experienced, please rank the our online payment method according to reliability.

The Rating Scale

A rating scale question requires a person to rate a product or brand along a well-defined, evenly spaced continuum. Rating scales are often used to measure the direction and intensity of attitudes. The following is an example of a comparative rating scale question:

Which of the following categories best describes your last experience purchasing a product or service on our website? Would you say that your experience was:

Very pleasant

Somewhat pleasant

Neither pleasant nor unpleasant

Somewhat unpleasant

Very unpleasant

The Semantic Differential Scale

The semantic differential scale asks a person to rate a product, brand, or company based upon a seven-point rating scale that has two bi-polar adjectives at each end. The following is an example of a semantic differential scale question.

Example:

Would you say our web site is:

(7) Very Attractive

(6)

(5)

(4)

(3)

(2)

(1) Very Unattractive

Notice that unlike the rating scale, the semantic differential scale does not have a neutral or middle selection. A person must choose, to a certain extent, one or the other adjective.

The Demographic Question

Demographic questions are an integral part of any questionnaire. They are used to identify characteristics such as age, gender, income, race, geographic place of residence, number of children, and so forth. For example demographic questions will help you to classify the difference between product users and non-users

Demographic data helps you paint a more accurate picture of the group of persons you are trying to understand. And by better understanding the type of people who use or are lik