1. PROJECT REPORT
ON
Role of Social Media Marketing in Purchase Decisions
Submitted in partial fulfillment of requirement of Bachelor of Business
Administration (B.B.A) General
BBA VI Semester (2nd shift, Section -A)
Batch 2010-2013
Submitted to: Submitted by:
Ms. Pallavi Ahuja Vishal Yadav
Ass. Professor 04224501710
JAGANNATH INTERNATIONAL MANAGEMENT SCHOOL.
KALKAJI
1
2. Student’s Undertaking
I hereby certify that this is my original work and it has never been
submitted elsewhere
by:
Vishal Yadav
2
4. I would like to take an opportunity to thank all the people who helped me in
collecting necessary information and making the project. I am grateful to all
of them for their time, energy and wisdom.
Getting a project ready requires the work and effort. I would like to thank all
those who have contributed in completing this project. Specially, I would
like to send my sincere thanks to Ms. Pallavi Ahuja for her helpful hand in
the completion of my project.
NAME:
VISHAL YADAV
EXECUTIVE SUMMARY
Social Media, today, is among the ‘best opportunities available’ to a brand
for connecting with prospective consumers. Social media is the medium to
socialize. These new media win the trust of consumers by connecting with
them at a deeper level. Social media marketing is the new mantra for
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5. several brands since early last year. Marketers are taking note of many
different social media opportunities and beginning to implement new social
initiatives at a higher rate than ever before. Social media marketing and
the businesses that utilize it have become more sophisticated. One cannot
afford to have no presence on the social channels if the competitor is
making waves with its products and services. The explosion of social
media phenomenon is as mind boggling as that and the pace at which it is
growing is maddening. Global companies have recognized social media
marketing as a potential marketing platform, utilized them with innovations
to power their advertising campaign with social media marketing. This
paper discusses about the concepts of social media and social media
marketing and other aspects like the growth and benefits, role and
relevance of social media in marketing, social media marketing strategies.
It also presents an overview on social media marketing in India.
This presents marketers with the opportunity to affect consumers purchase
decisions through online marketing and social media. This social
engagement by consumers has significant impact on marketing activities
as marketers need to be aware of the factors affecting consumer’s
purchase decision. The significance of this research study is that marketing
communications has taken on a different dimension with the growth of
online market places.
Keywords: social media, social media marketing, growth and benefits of
social media, social
media marketing strategy, social media marketing in Indi
CERTIFICATE OF COMPLETION
5
6. This is to certify that VISHAL YADAV of BBA VI A (E) has prepared this project
sincerely and satisfactorily under my guidance. The project is complete to the best of
my knowledge and worth appreciation.
Project guide:
Ms. PALLAVI AHUJA
(ASSISTANT PROFESSOR)
INTRODUCTION
6
7. Social media is hot. Social Media is now the trend. And for businesses it
represents a marketing opportunity that transcends the traditional
middleman and connects companies directly with customers. This is why
nearly every business on the planet—from giants like Starbucks and IBM
to the local ice cream shop—are exploring social media marketing
initiatives. A year ago, businesses were uncertain about social media. Now
it's here to stay and companies are rapidly adopting social media
marketing. Much like email and websites first empowered businesses,
social media is the next marketing wave.
Social media marketing is marketing using online communities, social
networks, blog marketing and more. It's the latest "buzz" in marketing.
India is probably among the first proponents of social media marketing.
These days, the organizational cause has replaced the social cause as
companies seek to engage with their audience via the online platforms.
The explosion of social media phenomenon is as mind boggling as that
and the pace at which it is growing is maddening. Trust and goodwill are
the basis of social networking, and by marketing in the realm of social
media these fundamental notions need to be adhered. It is
probably the only marketing platform that encourages fool proof
communication and accountability among sellers as well as consumers.
Global companies have recognized Social Media Marketing as a potential
marketing platform, utilized them with innovations to power their
advertising campaign with social media marketing.
Social media:
Social media is engaging with consumers online. According to Wikipedia,
social media is internet-based tools for sharing and discussing information
among human beings. Social media is all about networking and networking
in a way that espouses trust among parties and communities involved. Any
website which allows user to share their content, opinions, views and
encourages interaction and community building can be classified as a
social media. Some popular social media sites are: Facebook, YouTube,
Twitter, Digg, MySpace, StumbleUpon, Delicious, Scribd, Flickr etc.
The meaning of the term ‘social media’ can be derived from two words
which constitute it. Media generally refers to advertising and the
7
8. communication of ideas or information through publications/channels.
Social implies the interaction of individuals within a group or community.
Taken together, social media simply refers to communication/publication
platforms which are generated and sustained by the interpersonal
interaction of individuals through the specific medium or tool. Wikipedia
has a general definition of the term: Social Media is the democratization of
information, transforming people from content readers into content
publishers. It is the shift from a broadcast mechanism to a many-to-many
model, rooted in conversations between authors, people, and peers.
Social media uses the “wisdom of crowds” to connect information in a
collaborative manner. Social media can take many different forms,
including Internet forums, message boards, weblogs, wikis, podcasts,
pictures, and video.
Social media is made up of user-driven websites that are usually centered
on a specific focus (Digg = news) or feature (del.icio.us = bookmarking).
Sometimes, the community itself is the main attraction (Facebook and
Myspace = networking).
Social media are media for social interaction, using highly accessible and
scalable publishing techniques. Social media uses web-based
technologies to turn communication into interactive dialogues. Andreas
Kaplan and Michael Haenlein define social media as "a group of Internet3
based applications that build on the ideological and technological
foundations of Web 2.0, which allows the creation and exchange of user-
generated content."
Social media is the medium to socialize. They use web-based technology
to quickly disseminate knowledge and information to a huge number of
users. They allow creation and exchange of user-generated content.
Facebook, Twitter, Hi5, Orkut and other social networking sites are
collectively referred social media.
Social media represents low-cost tools that are used to combine
technology and social interaction with the use of words. These tools are
typically internet or mobile based like Twitter, Facebook, MySpace and
YouTube.
There are two benefits of social media that are important to businesses,
they include:
8
9. 1. Cost reduction by decreasing staff time.
2. Increase of probability of revenue generation.
Social media enables companies to:
• Share their expertise and knowledge.
• Tap into the wisdom of their consumers.
• Enables customers helping customers.
• Engages prospects through customer evangelism.
Thus the benefits of social media include: brand reach and awareness,
consumer interactions through transactions, referrals and reputation
management.
Social media marketing:
Social media marketing consists of the attempt to use social media to
persuade consumers that one's company, products and/or services are
worthwhile. Social media marketing is marketing using online communities,
social networks, blog marketing and more.
Lazer and Kelly’s (1973) define social marketing as "concerned with the
application of marketing knowledge, concepts, and techniques to enhance
social as well as economic ends. It is also concerned with the analysis of
the social consequences of marketing policies, decisions andconcerned
with the analysis of the social consequences of marketing policies,
decisions and activities."
Social media marketing is not merely about hitting the frontpage of Digg or
any other social news website. It is a strategic and methodical process to
establish the company’s influence, reputation and brand within
communities of potential customers, readers or supporters.
OBJECTIVES
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10. Internet and social media: The research objective is to assess if
marketing activities to stimulate the need for the brand or product
throughaggressive online marketing communication (brand
awareness) will beeffective through company websites and/or social
media platforms.
Brand-consumer engagement: The research objective is to assess
if consumers are interested in engaging with brands (via marketers)
on social media platforms to increase their knowledge about the
brands performance, specification, capabilities and price.
Online recommendations: The research objective is to assess if
consumers are willing to engage in word of mouth (WOM) by sharing
opinions, perceptions and experiences regarding tyre brands and
tyre purchases with other consumers.
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12. RETAIL :
Retail is the sale of goods and services from individuals or businesses to the end-user.
Retailers are part of an integrated system called the supply chain. A retailer purchases
goods or products in large quantities from manufacturers directly or through a
wholesale, and then sells smaller quantities to the consumer for a profit. Retailing can
be done in either fixed locations like stores or markets, door-to-door or by delivery.
Retailing includes subordinated services, such as delivery. The term "retailer" is also
applied where a service provider services the needs of a large number of individuals,
such as a public. Shops may be on residential streets, streets with few or no houses or
in a shopping mall. Shopping streets may be for pedestrians only. Sometimes a
shopping street has a partial or full roof to protect customers from precipitation. Online
retailing, a type of electronic commerce used for business-to-consumer (B2C)
transactions and mail order, are forms of non-shop retailing.
Shopping generally refers to the act of buying products. Sometimes this is done to
obtain necessities such as food and clothing; sometimes it is done as a recreational
activity. Recreational shopping often involves window shopping (just looking, not
buying) and browsing and does not always result in a purchase.
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13. TYPE OF RETAIL OUTLETS :
A marketplace is a location where goods and services are exchanged. The traditional
market square is a city square where traders set up stalls and buyers browse the
merchandise. This kind of market is very old, and countless such markets are still in
operation around the whole world.
In some parts of the world, the retail business is still dominated by small family-run
stores, but this market is increasingly being taken over by large retail chains.
Retail is usually classified by type of products as follows:
• Food products
• Hard goods or durable goods ("hardline retailers") - appliances, electronics,
furniture, sporting goods, etc. Goods that do not quickly wear out and provide
utility over time.
• Soft goods or consumables - clothing, apparel, and other fabrics. Goods that are
consumed after one use or have a limited period (typically under three years) in
which you may use them.
There are the following types of retailers by marketing strategy:
• Department stores - very large stores offering a huge assortment of "soft" and
"hard goods; often bear a resemblance to a collection of specialty stores. A
retailer of such store carries variety of categories and has broad assortment at
average price. They offer considerable customer service.
• Discount stores - tend to offer a wide array of products and services, but they
compete mainly on price offers extensive assortment of merchandise at
affordable and cut-rate prices. Normally retailers sell less fashion-oriented
brands.
• Warehouse stores - warehouses that offer low-cost, often high-quantity goods
piled on pallets or steel shelves; warehouse clubs charge a membership fee;
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14. • Variety stores - these offer extremely low-cost goods, with limited selection;
• Demographic - retailers that aim at one particular segment (e.g., high-end
retailers focusing on wealthy individuals).
• Mom-And-Pop : is a retail outlet that is owned and operated by individuals. The
range of products are very selective and few in numbers. These stores are seen
in local community often are family-run businesses. The square feet area of the
store depends on the store holder.
• Specialty stores: A typical speciality store gives attention to a particular category
and provides high level of service to the customers. A pet store that specializes
in selling dog food would be regarded as a specialty store. However, branded
stores also come under this format. For example if a customer visits a Reebok or
Gap store then they find just Reebok and Gap products in the respective stores.
• General store - a rural store that supplies the main needs for the local
community;
• Convenience stores: is essentially found in residential areas. They provide
limited amount of merchandise at more than average prices with a speedy
checkout. This store is ideal for emergency and immediate purchases as it often
works with extended hours, stocking everyday;
• Hypermarkets: provides variety and huge volumes of exclusive merchandise at
low margins. The operating cost is comparatively less than other retail formats.
• Supermarkets: is a self-service store consisting mainly of grocery and limited
products on non food items. They may adopt a Hi-Lo or an EDLP strategy for
pricing. The supermarkets can be anywhere between 20,000 and 40,000 square
feet (3,700 m2). Example: SPAR supermarket.
• Malls: has a range of retail shops at a single outlet. They endow with products,
food and entertainment under a roof.
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15. • Category killers or Category Specialist: By supplying wide assortment in a single
category for lower prices a retailer can "kill" that category for other retailers. For
few categories, such as electronics, the products are displayed at the centre of
the store and sales person will be available to address customer queries and
give suggestions when required. Other retail format stores are forced to reduce
the prices if a category specialist retail store is present in the vicinity.
• E-tailers: The customer can shop and order through internet and the
merchandise are dropped at the customer's doorstep. Here the retailers use
drop shipping technique. They accept the payment for the product but the
customer receives the product directly from the manufacturer or a wholesaler.
This format is ideal for customers who do not want to travel to retail stores and
are interested in home shopping. However it is important for the customer to be
wary about defective products and non secure credit card transaction. Example:
Amazon, Pennyful and eBay.
• Vending Machines: This is an automated piece of equipment wherein customers
can drop the money in the machine and acquire the products.
Some stores take a no frills approach, while others are "mid-range" or "high end",
depending on what income level they target.
Other types of retail store include:
• Automated Retail stores are self-service, robotic kiosks located in airports, malls
and grocery stores. The stores accept credit cards and are usually open 24/7.
Examples include Zoom Shops and Redbox.
• Big-box stores encompass larger department, discount, general merchandise,
and warehouse stores.
Retailers can opt for a format as each provides different retail mix to its customers
based on their customer demographics, lifestyle and purchase behavior. A good format
will lend a hand to display products well and entice the target customers to spawn
sales.
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16. Global Top Five Retailers
Worldwide Top Five Retailers
Rank Company Origin Revenue
1 Walmart US $421,849
2 Carrefour France $121,519
3 Tesco UK $94,244
4 Metro AG Germany $89,311
5 Kroger US $82,189
Retailing in India
Retailing in India is one of the pillars of its economy and accounts for 14 to 15 percent
of its GDP.[1][2] The Indian retail market is estimated to be US$ 450 billion and one of the
top five retail markets in the world by economic value. India is one of the fastest
growing retail market in the world, with 1.2 billion people. [3][4]
India's retailing industry is essentially owner manned small shops. In 2010, larger
format convenience stores and supermarkets accounted for about 4 percent of the
industry, and these were present only in large urban centers. India's retail and logistics
industry employs about 40 million Indians (3.3% of Indian population).
Until 2011, Indian central government denied foreign direct investment (FDI) in multi-
brand retail, forbidding foreign groups from any ownership in supermarkets,
convenience stores or any retail outlets. Even single-brand retail was limited to 51%
ownership and a bureaucratic process.
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17. In November 2011, India's central government announced retail reforms for both multi-
brand stores and single-brand stores. These market reforms paved the way for retail
innovation and competition with multi-brand retailers such as Walmart, Carrefour and
Tesco, as well single brand majors such as IKEA, Nike, and Apple.[5] The
announcement sparked intense activism, both in opposition and in support of the
reforms. In December 2011, under pressure from the opposition, Indian government
placed the retail reforms on hold till it reaches a consensus. [6]
In January 2012, India approved reforms for single-brand stores welcoming anyone in
the world to innovate in Indian retail market with 100% ownership, but imposed the
requirement that the single brand retailer source 30 percent of its goods from India.
Indian government continues the hold on retail reforms for multi-brand stores. [7]
In June 2012, IKEA announced it has applied for permission to invest $1.9 billion in
India and set up 25 retail stores. Fitch believes that the 30 percent requirement is likely
to significantly delay if not prevent most single brand majors from Europe, USA and
Japan from opening stores and creating associated jobs in India. [8][9]
On 14 September 2012, the government of India announced the opening of FDI in
multi-brand retail, subject to approvals by individual states. [10] This decision has been
welcomed by economists and the markets, however has caused protests and an
upheaval in India's central government's political coalition structure. On 20 September
2012, the Government of India formally notified the FDI reforms for single and multi
brand retail, thereby making it effective under Indian law. [11][12][13]
On 7 December 2012, the Federal Government of India allowed 51% FDI in multi-brand
retail in India. The Feds managed to get the approval of multi-brand retail in the
parliament despite heavy uproar from the opposition. Some states will allow foreign
supermarkets like Walmart, Tesco and Carrefour to open while other states will not. [14]
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18. E – RETAILING
E-retailing uses internet as a medium for customers to shop for the goods or services. It
can be either pure-plays or bricks-and-clicks. Pure-play uses internet as primary means
of retailing while bricks-and-clicks uses the internet as an addition to the physical store.
Now a day retailers have started offering almost everything under the sun on internet.
From products like groceries to services like online gaming and jobs, e-retailing covers
all frontiers. Unfortunately, India has lagged in e-retail growth story due to low density
of internet connections, lower penetration of credit cards and customer anxiety in using
new technologies.
During the dotcom boom Ecommerce was the sunrise industry, the one that would
change the face of the world. While E bay and Amazon the twin pillars of Ecommerce
in US did bring about paradigm shift in USA, the tech pundits in India are still a bit iffy
about Ecommerce in India. Today the Internet might be viewed as a huge market
potentially capable of covering the population of the whole world. This is why electronic
commerce or E-Commerce is so attractive for many traditional businesses. E-
Commerce consists of the buying and selling of products or services over electronics
stems such as the Internet and other computer networks. The amount of trade
conducted electronically has grown dramatically since the large introduction of the
Internet. A wide variety of commerce is conducted in this way, including things such as
electronic funds transfer, supply chain management, e-marketing, online marketing,
online transaction processing, electronic data interchange, automated inventory
management systems, and automated data collection systems. Modern electronic
commerce typically uses the World Wide Web in at least some point in the
transaction's Lifecycle.
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19. E-retailing in India
E-retailing, most commonly known as e-tailing is nothing but shopping through the
Internet and other media forms. There are many things that are common between
direct retail stores and online retail stores. Both have the process of billing of the
customers and have to maintain a relationship with the suppliers.
List of Online Shopping Websites in India
Multiple Stuff
• www.flipkart.com
www.snapdeal.com
• www.infibeam.com
• www.indiaplaza.com
• www.homeshop18.com
• www.tradus.com
• www.timtara.com
• www.shopping.indiatimes.com
• www.futurebazaar.com
Apparel , Shoes, Accessories and Home Furnishing
• www.jabong.com
• www.myntra.com
• www.yebhi.com
• www.pepperfry.com
• www.fashionara.com
• www.fashionandyou.com
• www.ladyblush.com (Girls only)
• www.shopnineteen.com (Girls only)
• www.Shop.inonit.com (Girls only)
• www.herstyle.in (Girls only)
• www.koovs.com (Girls only)
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20. • www.shoppersstop.com
• www.cilory.com
Indian Ethnic Wear
• www.utsavfashion.in
• www.chhabra555.com
• Lingerie Only
• www.strapsandstrings.com
• www.zivame.com
• www.ngaloriginals.com
• www.buyundercover.com
www.prettysecrets.com
• Home Furnishing
• www.urbanladder.com
• www.fabfurnish.com
• Personal Care and Well Being
• www.purplle.com
• www.goodlife.com
• Mom and Kids Care
• www.bundlebaazi.com
• www.babyoye.com
• www.firstcry.com
• www.hoopos.com
• www.hushbabies.com
• www.allshoolstuff.com ( School Stuff)
• Shoes Only
• www.bestylish.com
• www.metroshoes.net
• www.libertyshoesonline.com
• www.bata.in
Jewellery only
• www.jewelsnext.com
www.juvalia.in
• www.gitanjaligifts.com
• www.bluestone.com
• www.tanishq.co.in
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21. CUSTOMER
A customer (also known as a client, buyer, or purchaser) is the recipient of a good,
service, product, or idea, obtained from a seller, vendor, or supplier for a monetary or
other valuable consideration. Customers are generally categorized into two types:
• An intermediate customer or trade customer (more informally: "the trade") who is
a dealer that purchases goods for re-sale
• An ultimate customer who does not in turn re-sell the things bought but either
passes them to the consumer or actually is the consumer
A customer may or may not also be a consumer, but the two notions are distinct, even
though the terms are commonly confused. [3][1] A customer purchases goods; a
consumer uses them. An ultimate customer may be a consumer as well, but just as
equally may have purchased items for someone else to consume. An intermediate
customer is not a consumer at all. The situation is somewhat complicated in that
ultimate customers of so-called industrial goods and services (who are entities such as
government bodies, manufacturers, and educational and medical institutions) either
themselves use up the goods and services that they buy, or incorporate them into other
finished products, and so are technically consumers, too. However, they are rarely
called that, but are rather called industrial customers or business-to-business
customers. Similarly, customers who buy services rather than goods are rarely called
consumers.
Six Sigma doctrine places (active) customers in opposition to two other classes of
people: not-customers and non-customers. Whilst customers have actively dealt with a
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22. business within a particular recent period that depends from the product sold, not-
customers are either past customers who are no longer customers or potential
customers who choose to do business with the competition, and non-customers are
people who are active in a different market segment entirely. Geoff Tennant, a Six
Sigma consultant from the United Kingdom, uses the following analogy to explain the
difference: A supermarket's customer is the person buying milk at that supermarket; a
not-customer is buying milk from a competing supermarket, whereas a non-customer
doesn't buy milk from supermarkets at all but rather "has milk delivered to the door in
the traditional British way". [6]
Tennant also categorizes customers another way, that is employed out with the fields of
marketing. Whilst the intermediate/ultimate categorization is used by marketers, market
regulation, and economists, in the world of customer service customers are categorized
more often into two classes:
• An external customer of an organization is a customer who is not directly
connected to that organization.[7][8]
• An internal customer is a customer who is directly connected to an organization,
and is usually (but not necessarily) internal to the organization. Internal
customers are usually stakeholders, employees, or shareholders, but the
definition also encompasses creditors and external regulators.[9][8]
The notion of an internal customer — before the introduction of which external
customers were, simply, customers — was popularized by quality management writer
Joseph M. Juran, who introduced it in the fourth edition of his Handbook (Juran 1988).
[10][11][12]
It has since gained wide acceptance in the literature on total quality
management and service marketing;[10] and the customer satisfaction of internal
customers is nowadays recognized by many organizations as a precursor to, and
prerequisite for, external customer satisfaction, with authors such as Tansuhaj, Randall
& McCullough 1991 arguing that service organizations that design products for internal
customer satisfaction are better able to satisfy the needs of external customers. [13]
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23. CUSTOMER PERCEPTION
Definition
Consumer perception applies the concept of sensory perception to marketing and
advertising. Just as sensory perception relates to how humans perceive and process
sensory stimuli through their five senses, consumer perception pertains to how
individuals form opinions about companies and the merchandise they offer through the
purchases they make. Merchants apply consumer perception theory to determine how
their customers perceive them. They also use consumer perception theory to develop
marketing and advertising strategies intended to retain current customers -- and attract
new ones.
Self Perception
Self perception theory attempts to explain how individuals develop an understanding of
the motivations behind their own behavior. Self perception by customers relates to
values and motivations that drive buying behavior -- which is also an important aspect
of consumer perception theory. For instance, a study by researchers at the University
of Massachusetts at Amherst addressed how self perception shaped consumers'
buying behavior. The study considered the question of whether consumers believed
their buying decisions had a real effect on issues such as environmental impact. The
researchers concluded that consumers' self perception was a driving factor in whether
or not they placed a priority on socially conscious purchase and consumption practices.
Consumers who viewed themselves as socially conscious tended to place more weight
on issues such as environmental impact when making buying decisions than
consumers who did not hold similar views of themselves.
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24. Price Perception
While mass merchandisers such as Wal-Mart emphasize low prices as an inherent
virtue, upscale merchants attempt to emphasize quality and value for money to appeal
to potential customers. Researchers at the School of Business Administration at
LaSalle University and LeBow College of Business at Drexel University considered
several factors, including price perception -- whether consumers believed they were
being charged fair prices -- in determining whether online shoppers would make repeat
purchases through the same website. The researchers concluded that price perception
strongly influenced whether customers were satisfied with their purchases and whether
they would make future purchases. Two factors that shaped price perception were the
perceived quality of the merchandise or service in question and price comparisons with
merchants offering similar merchandise or services.
Benefit Perception
"It's good, and it's good for you." Many consumers are familiar with this phrase
frequently associated with food advertising. Researchers from Marquette University,
Louisiana State University and the University of Arkansas surveyed customers to
determine how nutrition claims associated with food affected their perception of that
food's nutritional value. The researchers found that consumers tend to reject general,
unsupported claims of enhanced nutrition, especially concerning high nutritional value
for foods that are traditionally viewed as unhealthy. The researchers also theorized that
consumers would demonstrate a trend toward applying more scrutiny to nutrition claims
and would demand more specific information about the foods they purchase.
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25. WEBSITE
A website, also written as Web site, [1] web site, or simply site is a set of related web
pages served from a single web domain. A website is hosted on at least one web
server, accessible via a network such as the Internet or a private local area network
through an Internet address known as a Uniform Resource Locator. All publicly
accessible websites collectively constitute the World Wide Web.
A webpage is a document, typically written in plain text interspersed with formatting
instructions of Hypertext Markup Language (HTML, XHTML). A webpage may
incorporate elements from other websites with suitable markup anchors.
Web pages are accessed and transported with the Hypertext Transfer Protocol (HTTP),
which may optionally employ encryption (HTTP Secure, HTTPS) to provide security
and privacy for the user of the webpage content. The user's application, often a web
browser, renders the page content according to its HTML markup instructions onto a
display terminal.
The pages of a website can usually be accessed from a simple Uniform Resource
Locator (URL) called the web address. The URLs of the pages organize them into a
hierarchy, although hyper linking between them conveys the reader's perceived site
structure and guides the reader's navigation of the site which generally includes a
home page with most of the links to the site's web content, and a supplementary about,
contact and link page.
Some websites require a subscription to access some or all of their content. Examples
of subscription websites include many business sites, parts of news websites,
academic journal websites, gaming websites, file-sharing websites, message boards,
web-based email, social networking websites, websites providing real-time stock
25
26. market data, and websites providing various other services (e.g., websites offering
storing and/or sharing of images, files and so forth).
ONLINE SHOPPING
Logistics
Consumers find a product of interest by visiting the website of the retailer directly or by
searching among alternative vendors using a shopping search engine.
Once a particular product has been found on the website of the seller, most online
retailers use shopping cart software to allow the consumer to accumulate multiple items
and to adjust quantities, like filling a physical shopping cart or basket in a conventional
store. A "checkout" process follows (continuing the physical-store analogy) in which
payment and delivery information is collected, if necessary. Some stores allow
consumers to sign up for a permanent online account so that some or all of this
information only needs to be entered once. The consumer often receives an e-mail
confirmation once the transaction is complete. Less sophisticated stores may rely on
consumers to phone or e-mail their orders (though credit card numbers should never
be accepted by e-mail, for security).
Payment
Online shoppers commonly use a credit card or a PayPal account in order to make
payments. However, some systems enable users to create accounts and pay by
alternative means, such as:
• Billing to mobile phones and landlines[4][5]
• Cash on delivery (C.O.D., offered by very few online stores)
• Cheque/ Check
26
27. • Debit card
• Direct debit in some countries
• Electronic money of various types
• Gift cards
• Postal money order
• Wire transfer/delivery on payment
• Invoice, especially popular in some markets/countries, such as Switzerland
Some online shops will not accept international credit cards. Some require both the
purchaser's billing and shipping address to be in the same country as the online shop's
base of operation. Other online shops allow customers from any country to send gifts
anywhere.
The financial part of a transaction may be processed in real time (e.g. letting the
consumer know their credit card was declined before they log off), or may be done later
as part of the fulfillment process.
Product delivery
Once a payment has been accepted, the goods or services can be delivered in the
following ways:
• Downloading: The method often used for digital media products such as
software, music, movies, or images.
• Drop shipping: The order is passed to the manufacturer or third-party distributor,
who then ships the item directly to the consumer, bypassing the retailer's
physical location to save time, money, and space.
27
28. • In-store pick-up: The customer selects a local store using a locator software and
picks up the delivered product at the selected location. This is the method often
used in the bricks and clicks business model.
• Printing out, provision of a code for, or e-mailing of such items as admission
tickets and scrip (e.g., gift certificates and coupons). The tickets, codes, or
coupons may be redeemed at the appropriate physical or online premises and
their content reviewed to verify their eligibility (e.g., assurances that the right of
admission or use is redeemed at the correct time and place, for the correct dollar
amount, and for the correct number of uses).
• Shipping: The product is shipped to a customer-designated address.
• Will call, lCOBO (in Care Of Box Office), or "at the door" pickup: The patron
picks up pre-purchased tickets for an event, such as a play, sporting event, or
concert, either just before the event or in advance. With the onset of the Internet
and e-commerce sites, which allow customers to buy tickets online, the
popularity of this service has increased.
Shopping cart systems
• Simple systems allow the off-line administration of products and categories. The
shop is then generated as HTML files and graphics that can be uploaded to a
webspace. The systems do not use an online database. [citation needed]
• A high-end solution can be bought or rented as a stand-alone program or as an
addition to an enterprise resource planning program. It is usually installed on the
company's webserver and may integrate into the existing supply chain so that
ordering, payment, delivery, accounting and warehousing can be automated to a
large extent.
• Other solutions allow the user to register and create an online shop on a portal
that hosts multiple shops simultaneously. [citation needed]
28
29. • Open source shopping cart packages include advanced platforms such as
Interchange, and off-the-shelf solutions such as Magento, osCommerce,
PrestaShop, Shopify, Zen Cart.[6]
• Commercial systems can also be tailored so the shop does not have to be
created from scratch. By using an existing framework, software modules for
various functionalities required by a web shop can be adapted and combined.
[citation needed]
Design
Customers are attracted to online shopping not only because of high levels of
convenience, but also because of broader selections, competitive pricing, and greater
access to information. Business organizations seek to offer online shopping not only
because it is of much lower cost compared to bricks and mortar stores, but also
because it offers access to a worldwide market, increases customer value, and builds
sustainable capabilities.[
Information load
Designers of online shops are concerned with the effects of information load.
Information load is a product of the spatial and temporal arrangements of stimuli in the
web store.[10] Compared with conventional retail shopping, the information environment
of virtual shopping is enhanced by providing additional product information such as
comparative products and services, as well as various alternatives and attributes of
each alternative, etc.[11]
Two major dimensions of information load are complexity and novelty. Complexity
refers to the number of different elements or features of a site, often the result of
increased information diversity. Novelty involves the unexpected, suppressed, new, or
unfamiliar aspects of the site. The novelty dimension may keep consumers exploring a
shopping site, whereas the complexity dimension may induce impulse purchases
29
30. Consumer needs and expectations
A successful web store is not just a good looking website with dynamic technical
features, listed in many search engines. [13] In addition to disseminating information, it is
also about building a relationship with customers and making money.
Businesses often attempt to adopt online shopping techniques without understanding
them and/or without a sound business model; often times, businesses produce web
stores that support the organizations' culture and brand name without satisfying
consumer expectations. User-centered design is critical. Understanding the customer's
wants and needs is essential. Living up to the company's promises gives customers a
reason to come back and meeting their expectations gives them a reason to stay. It is
important that the website communicates how much the company values its customers.
Customer needs and expectations are not the same for all customers. Age, gender,
experience and culture are all important factors. For example, Japanese cultural norms
may lead users there to feel privacy is especially critical on shopping sites and
emotional involvement is highly important on financial pensions sites. [9] Users with more
online experience focus more on the variables that directly influence the task, while
novice users focus on understanding the information
To increase online purchases, businesses must expend significant time and money to
define, design, develop, test, implement, and maintain the web store. It is easier to lose
a customer than to gain one. Even a "top-rated" website will not succeed if the
organization fails to practice 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. Because it is so important to eliminate mistakes and be more
appealing to online shoppers, many web shop designers study research on consumer
expectations.
User interface
30
31. An automated online assistant, with potential to enhance user interface on shopping
sites.
The most important factors determining whether customers return to a website are
ease of use and the presence of user-friendly features. [16] Usability testing is important
for finding problems and improvements in a web site. Methods for evaluating usability
include heuristic evaluation, cognitive walk through, and user testing. Each technique
has its own characteristics and emphasizes different aspects of the user experience. [16]
Market share
E-commerce B2C product sales totaled $142.5 billion, [3] representing about 8% of retail
product sales in the United States. [17] The $26 billion worth of clothes sold online
represented about 13% of the domestic market, [18] and with 72% of women looking
online for apparel, it has become one of the most popular cross-shopping categories. [19]
Forrester Research estimates that the United States online retail industry will be worth
$279 billion in 2015.[20] There were 242 million people shopping on-line in China in
2012.
For developing countries and low-income households in developed countries, adoption
of e-commerce in place of or in addition to conventional methods is limited by a lack of
affordable Internet access.
Online Vs. Traditional Shopping
The advent of the Internet has had an impact in our lives in all sorts of ways such as in
the manner in which we communicate, flirt, date, and most importantly, how we shop.
While even in the recent past the thought of whether some day one would be able to
buy an Armani outfit wearing pajamas while looking after the needs of a couple of
toddlers would have seemed an outlandish idea, thanks to the increasing sophistication
of the technology of the 21st century, practically everything is virtually possible, and
31
32. shopping from the comfort of one’s home has become a part of most people’s daily
lives.
When retailing on the web started, sometime in the middle to the late 1990s, it gave
rise to the debate which is still ongoing, about online vs. traditional shopping. And even
though shopping centers are still being thronged by shoppers, just as they do on the
Internet, the question still remains – Whether online shopping will conquer all, or if
traditional shopping will survive this increasing onslaught of e-shopping?
In order to study this, let’s examine a few pros and cons of online vs. traditional
shopping:
One of the main advantages of shopping online is the elimination of the need to drive
somewhere to buy something. So, no frustrations of dealing with traffic snarls and no
parking problems. Besides, you could use up half your petrol merely shopping for the
stuff you want. With the price of petrol being what it is these days, the money you save
by shopping online will often be enough to pay for a few items or gifts you were thinking
of buying.
Online shopping saves precious time. With the busy lives that most of us lead these
days, anything that saves time is a boon. When you shop online, it will take you about a
minute to log on to the Internet, about a minute or two more to access the website of
the store of your choice, it may take another ten to fifteen minutes to select the items
you want to buy, and about five minutes more to fill in the information about your
payment and get a print out of your receipt. Voila! It would take you just about thirty
minutes to do your shopping. Imagine all the things you could do with all the time
saved, like spending quality time with the kids, or perhaps even catching the movie you
have been meaning to see.
Online shopping offers a sense of ease and comfort; as opposed to trudging all through
the high street hunting for the things you want. You can truly understand the difference
between online vs. traditional shopping when you step into a brick and mortar shop,
especially during holiday shopping season. You have to struggle your way through
32
33. crowds of jostling people, wait in queues to make your purchase, and you usually have
to go from one store to another to find some item you may be looking for.
And that is one of the main problems of a traditional shop. Usually, if you are looking for
a particular item, you will find only limited choices of it. Having a limitation of shelf
space, brick and mortar shops simply cannot afford to provide large varieties of
products. For them, it makes economic sense to fill the limited space on their shelves
with items that sell most. These products may not necessarily be the best, but probably
are the ones that are marketed the best.
Online stores, on the other hand, do not have this problem of limitation of shelf space.
“Shelf space” that is virtual is limited only by the web server’s storage capacity. Hence,
an online store can have innumerable varieties of a particular product, which would use
up negligible hard drive space. With suppliers providing same day shipping facility,
virtual stores need not even carry the stocks of all the items, hence they require no
shelf space for warehousing either.
Since online shelf space happens to be so plentiful and cheap, it means online shops
can also cater to particular niche markets. For example, an online store can afford to
sell just intercom systems such as video intercoms, wireless intercoms, wireless infant
monitoring systems and the like, which would not be possible for a brick and mortar
retail store. Even if it were located in a large city, while it would perhaps sell some
intercom systems, the sales would not be able to cover the overhead expenses
involved in brick and mortar stores.
This is where online stores win hands down against brick and mortar stores. Compared
to a building made of brick and mortar, online websites are incredibly cheap to set up.
And to top it all, unlike a building which is accessible only to the people of the locality,
websites are accessible to the whole world.
When you shop online, you have the ability to scroll quickly through several stores to
locate the item you want to buy. Most of these websites are very user friendly and
simple to navigate through. All of which implies that the advent of online shopping has
provided consumers the facility of making infinite choices in getting exactly the product
33
34. they want. The demand and supply bottle-necks of the past no longer exist; hence
everyone has access to everything. With shelf space not costing much, everyone’s
shopping requirements can be catered to.
The next important factor of online vs. traditional shopping is the price. You will hardly
ever find actual sales when you shop in a traditional retail store. More often than not,
the so called “sale price” tagged on a product is its actual price, and is just put there
each weekend to entice customers. Whereas, when you shop online, you can hop from
one store to another, comparing prices. Thus, when there is an actual drop in prices,
you can actually benefit from it.
Another feature that online stores offer which traditional stores don’t is wholesale.
When a product is sold at or less than the retail price, it is referred to as wholesale.
Such sales are never available in brick and mortar retail outlets.
In addition, besides being to able to shop from the comfort of your home, you can shop
online any time during the day. Shops on the Internet never shut down for the night,
unlike traditional retail shops and shopping centers. This means that you never have to
think about having to wait for the right time to shop, to avoid crowds. You can shop
whenever you have the time and feel the need to.
However, traditional shopping does have certain plus points. Immediate gratification
that local brick and mortar shops provide is still liked by many people. If you want
something right away, just now, getting it from a retail store is the only option. Seeing
and touching a product is also an important factor for many people when they buy
things. For example, most people would not buy a piece of expensive jewellery only on
the basis of a picture on a website.
The chances are slim for the Internet to capture a share of the market of industries
which are more suitable for traditional shopping. While consumers can carry out
research online for high priced items like properties and cars, people usually want to
see the piece of real estate or visit a car showroom and test drive a car before finalizing
a deal. A traditional retailer bestows the personalized human contact which is not
available on the Internet.
34
35. Besides, for many people shopping is a source of entertainment, almost a social rite.
People like to handle things, especially clothes, feel the texture, and try them on to see
how they look in them.
But the rising popularity of shopping online proves that for an increasing number of
people factors like avoiding the inconvenience and crowds, incompetent shopping
assistants in the store, going all the way to the shop only to find the product they are
looking for is out of stock outweigh the few advantages that traditional shopping has to
offer.
Practically everything that can be bought at a shopping centre or a retail store can be
obtained online with ease in addition to being priced competitively. The only extra
expense is the delivery but this could be outweighed by the savings you make
shopping around online. So, if you really want an easier time when shopping, then
doing it online is the best way to go about it.
In traditional shopping, you simply take a ride in your car to your favorite shopping
center or store and you buy what you want or need. You can pay with cash or credit
card. In some instances you can pay with a check. You do get the opportunity to see
the product before you purchase it and you can keep an eye on your credit card if you
decide to pay with that method.
All of this seems rather great, doesn't it? However, there are always cons to the pros
when it comes to anything and everything.
The cons that you may run into when it comes to traditional shopping is that the store
you are shopping at may not accept your payment method. There is also the fact that
they may not have what you want. You may even find that the item they have is more
expensive than what you want to pay. You may know that another store carries it, but
they are out of it because they sell it at a cheaper price.
Yes, there are instances in which you must shop the traditional way. For example, you
may need an item right now, which is true of grocery shopping. When you need milk or
35
36. you need formula for the baby, you have to be able to go to the store and get those
things immediately.
When it comes to online shopping, you don't have to leave your home at all. You simply
sit down at your computer, browse around the various online stores, and find what it is
you need. However, there is usually only one way to pay. You can only pay via credit
card. There are some websites that allow you to use your PayPal account or they will
permit you to send them a check before they send you the item. The check method
doesn't work so well when you need the item right now.
As for the cons, you are not able to keep an eye on your credit card number like you
can with an in-person transaction. You can, however, ensure that you are doing
business with a secure site by looking in the address bar and seeing if there is an
https:// present. You can also read website reviews to make sure a site is secure. You
also do not get the opportunity to see the item right in front of you before you buy.
However, the advantages continue because, if you can't find an item at one store, you
can always find it at another. There really isn't much that you can't find on the Internet.
You may not want to grocery shop online, but gifts, clothes, and many other items can
be purchased and shipped right to your door. If you don't like them when you get them,
you can always ensure you're doing business with a company with a good return policy.
So which seems better to you? Do you prefer the traditional way or the online way? It is
a personal preference when it comes down to it. Really, all you need to do is shop the
way you feel comfortable, but know that you are going to find some great deals online
that you may not be able to offline.
Shop Smart. Get reward miles by shopping online. You can earn reward miles on all
purchases that are made online including clothing, jewelry and Dell Computers. Online
Shopping has never been easier or more rewarding.
36
37. E-marketing
E-marketing can be considered to be equivalent to Internet marketing. Most in the
industry would look at it this way.
However, E-marketing is sometimes considered to have a broader scope since it refers
to digital media such as web, e-mail and wireless media, but also includes
management of digital customer data and electronic customer relationship
management systems (E-CRM systems).
E-Marketing is the process of marketing a brand using the Internet. It includes both
direct response marketing and indirect marketing elements and uses a range of
technologies to help connect businesses to their customers. eMarketing encompasses
all the activities a business conducts via the worldwide web with the aim of attracting
new business, retaining marketing as:
Applying Digital technologies which form online channels (Web, e-mail, databases, plus
mobile/wireless & digital TV) to contribute to marketing activities aimed at achieving
profitable acquisition and retention of customers (within a multi-channel buying process
37
38. and customer lifecycle) through improving our customer knowledge (of their profiles,
behavior, value and loyalty drivers), then delivering integrated targeted communications
and online services that match their individual needs.
Chaffey's definition emphasizes that:
It should not be the technology that drives e-marketing, but the business returns from
gaining new customers and maintaining relationships with existing customers.
It also emphasizes how e-marketing does not occur in isolation, but is most effective
when it is integrated with other communications channels such as telemarketing, direct-
mail, personal selling, advertising, publicity, sales promotion, and other promotional
techniques.
Dave Chaffey, working from a relationship marketing perspective, has defined e-
Online channels should also be used to support the whole buying process from pre-
sale to sale to post-sale and further development of customer relationships where this
is appropriate.
It should be based on knowledge of customer needs developed by researching their
characteristics, behaviour, what they value, and what keeps them loyal.
The web and e-mail communications should be personally tailored to individual buyers
based on the information obtained in the research.
Products of E-Marketing
• E-ticketing-
• 39% have bought Railway Tickets online & 48% are likely to buy them in the
near future.
• 47% of Railway ticket purchasers are in the 26-35 age groups
38
39. • 29% have bought Airline Tickets online & 46% are likely to buy them in the near
future.
• 20% have booked Hotel Rooms
• Online books-41% have bought Books online & 44% are likely to buy them in
the near future. The 26-35 years (45%) age group represents the highest
penchant for shopping for Books online and 85% are Male.
• Music online- 24% have bought Music online & 33% are likely to buy them in
the near future. The 18-35 age groups are the highest purchasers of Music
online accounting for 74% of purchases & 39% of buyers of Music online are
‘Unmarried’ and 42% are ‘Married with kids’. Mumbai and Delhi account for 52%
of purchases of Music online. Cities like Lucknow (2%) and Jaipur feature in the
Top 8
• Electrical goods-40% have bought Electronic Gadgets online & 53% are likely
to buy them in the near future. 74% of Electronic Gadgets are being bought by
18-35 year age group, predominantly male driven (91%), 45% of shoppers are
‘Married with kids’ & 37% are ‘Unmarried’ .
• Job search - On an average Indians hold an estimated of 5 jobs in their lifetime
as compared to the western norm of 11.since 2004-05 the number of internet
users seeking jobs online has increased by 71% from 3.8 million in 2004-05 to
6.5 million in 2005-06 .
39
40. Tools and techniques of E-Marketing
• Search engine marketing
• Email marketing
• Banner ads
• Extranets
• Metrics and analysis
• Event registration
• Asset sharing
40
41. • Bulletin board
• Online survey
• Webinars
• Live chats
• Search Engine Marketing (SEM): Search engine marketing has of late become one
of the principle tools in the armory of the Sauvé internet marketer. This prominence of
SEM is owing to the fact that the search engines like Google, Yahoo etc. are being
used by more and more people as their principle method of searching for relevant
information. And, you can hope to sell through them if your website is visible on these
search engines. The principle techniques employed in SEM are:
o Search Engine Optimization (SEO): A set of practices employed to get ranking for
WebPages on relevant keywords (search queries). SEO does this by improving a
websites structure and content.
o Pay per Click (PPC): PPC takes the sponsored route to drive relevant traffic to a
website. The positioning of Ads is determined by a competitive bidding structure.
o Paid Inclusion: In paid inclusions, you can pay your way up on to the natural listings
of search engines. As of now, Google has stopped its paid inclusion program.
• E-Mail Marketing: As the name suggests, e-mail marketing is promotion through e-
mails. If used effectively it can assure you maximum returns on each penny you spend.
It can be used for acquiring new customers, enhance the relationship you have with
your existing clientele.
o Advantages: Cheap, instant, easily traceable and if used properly the return on
investment can be astounding.
o Disadvantages: Due to the overdoing of the e-mail campaigns by online companies,
they are now being categorized as Spam mail. Thereby reducing the chances of it
actually reaching the intended person.
41
42. • Banner Advertising: Banner marketing involves placing your advertisement on any
third party website. This Ad will link to your website, this way if the potential customer
clicks on your banner, he will be directed to your website. It can be a good way of
attracting relevant traffic to your website.
• Interactive Advertising: It involves the use of interactive media applications to
promote products online. It in fact involves the right use of text, images, Flash
animations, AV clips etc. The interactive advertising platform in a way intends to send
across a personalized message by giving the readers/ viewers a visual treat.
• Blog/ Article marketing: Articles and blogs can be used effectively to propagate a
marketing campaign. By submitting in various directories like Ezine and Go articles, you
can hope to generate traffic through the link you have placed on the article directing
towards your website.
Websites which will do business in Hindi and other local language would do well. It’s
simply because contrary to the claims, for a major chunk of Indians English is still an
alien language.
That’s why the scope of internet marketing in India lies in localization of websites.
Talking to people in their own language does have its positive attributes. The
indigenization of the web for the real Indians and the correct application of the
mentioned internet marketing techniques is truly the way forward.
42
43. RESEARCH METHODOLOGY
This data has been taken from secondary source of information.
Secondary Data is data or information that is already available. This data is collected by
a person or organization other than the use of the data.
Advantages of secondary data :
• it is cheap and inexpensive.
• It is easily accessible.
• It is already available. It saves time and efforts..
• It avoids data collection problems and it provides a basis for comparison.
This data is collected from various sources:
• Books,
• Magazines,
• websites,
• Already published reports, ,
• Journals and publications, Research papers etc.
43
45. Online Shoppers: Who They Are and What They Think
The table below compares the demographic characteristics of the two-thirds of online
users who have bought a product online such as books, music, toys, or clothing to
online Americans who have not made a product purchase on the internet.
45
46. Some expected demographic factors account for some of the differences between
online shoppers and other internet users. Online purchasers tend to be younger, better
educated, and higher-income than those who have not bought a product over the
internet. Technology may also play a role, as online buyers are more likely than non-
buyers to have “always on” high-speed connections at home.
Nonetheless, several hypotheses about online shopping do not hold up. For instance,
some have wondered whether rural internet users would be heavier participants in e-
shopping because of the convenience of doing things online rather than driving
relatively long distances. Our data do not bear that out, as 65% of rural internet users
have at one time bought something online, about the average. Rural internet users are
less likely, on the typical day, to do any of the online shopping activities listed earlier;
19% do one of those activities on the typical day compared to the 26% average for all
online users.
It is also worth noting that internet users who have not bought a product online are
hardly, as a group, suffering from an impoverishment of connectivity. More than half of
non-purchasers have broadband at home. Readers interested in demographic detail on
a range of online shopping activities should consult the table in the Appendix to this
report.
The table suggests that demography and technology are not the entire story behind
people’s predilections to purchase products online. Even though online Americans who
do not shop online have lower incomes and are less likely to have broadband at home,
the majority of low-income Americans have bought something online. Some 58% of
people whose annual household incomes are below $25,000 have at one time bought
something using the internet. Something else might explain differences between
purchases and non-purchasers. Our findings suggest that attitudes play a critical role in
shaping people’s tendencies to shop online.
46
47. Internet users like the convenience and time-saving potential
of online shopping, but they also worry about sending
personal or credit card information over the internet.
Americans find online shopping a convenience, a time-saver, and a good way to get
items that would otherwise be hard to find. Solid majorities of Americans saying they
either “strongly agree” or “agree” with propositions relating online shopping to these
notions.
At the same time, tensions and concerns are evident in people’s perspectives on
cyberspace as a place to shop. Fully three quarters (75%) either “strongly agree” or
“agree” with the statement that they don’t like giving their credit car number or personal
information online.
47
48. Most internet users are confident that online information will
get them where they want to go in their online shopping.
Nonetheless, sizable numbers express worries about their
online shopping experiences.
Fully 79% of internet users are confident that they will make the right purchasing
decision as they gather information online in advance of buying something. Most (63%)
report a sense of relief in the course of online information-gathering, as that key online
nugget may clarify a specific need. Just more than half (53%) are eager to share what
they have found online pertaining to shopping.
48
49. Nonetheless, sizable numbers express worries about their online shopping
experiences.
Some 43% of internet users have been frustrated by the lack of information they find
online or an inability to locate the commercial information they need. One-third (32%)
are confused by the information they find online, and 30% say they feel overwhelmed
by the amount of information they find online. This comes to 58% of internet users who
have experienced at least one of these three worries connected to online shopping.
49
50. Perceptions about the convenience of online shopping and
worries about sending personal information online are the
biggest determinants of whether people shop online or not.
The preceding discussion shows that attitudes, technology, and socio-economic factors
all come into play in influencing people’s choices to shop online. Which factors matter
more? Statistical analysis that enables the relative effects of different factors to be
pulled apart suggests that several attitudinal measures strongly shape whether or not
people shop online.6 The baseline for analysis in this section is users’ response to the
question about whether they had ever bought something online such as a book, toy,
clothing, or music, to which 66% of online users responded “yes.”
The effects and their size listed below are independent of all other factors, that is, the
figures show how the probability of someone shopping online would change if, say, he
thought online shopping was convenient, while holding all other factors, such as other
attitudinal measures, constant.
User concerns about sending personal or credit card information over the internet
has the largest effect among several key attitudinal measures. If the 75% of internet
users who “strongly agree” or “agree” that conveying this information online is problem
for shifted their views on this proposition, the share of the online population engaging in
online shopping would be 7 percentage points higher than the present level (or 73%
instead of 66%).
Users’ perceptions of online shopping as a convenience has a significant impact on
the chances internet users are participants in the online marketplace. As noted, most
internet users already think online shopping is to some extent convenient; 25% strongly
agree that it is, 53% agree, with 16% either disagreeing or strongly disagreeing that is.
If the 16% of online users who disagree that it is convenient were tipped into the
“agree” column, the share of the online population engaging in online shopping would
be 3 percentage points higher than the present level (or 69% instead of 66%).
Turning to perceptions about online shopping as a time-saver, there is a smaller, but
still significant boost to online shopping. If those who disagree that online shopping is a
time-saver (25% of the online population) came to simply “agree” with this notion, the
share of the online population engaging in online shopping would be 2 percentage
points higher than the current average (or 68% instead of 66%).
Improving online users’ comfort levels with sending personal or credit card information
over the internet would have the biggest payoffs for expanding online shopping.
Finally, technology makes a difference in whether people buy things online or not.
People with broadband at home are more likely than dial-up users to have bought
something online, by a 74% to 59% margin, a difference that is significant even when
socio-economic and demographic characteristics are taken into account. If existing
50
51. dialup users had high-speed connections at home, the incidence of online shopping
would be 6 percentage points higher than it presently is.
It is important to underscore that the above figures are estimates, but they do convey
the magnitude of the different things that influence the probability that someone will
execute a transaction online. If efforts were devoted to changing attitudes about online
shopping, the greatest payoffs would come from improving online users’ comfort level
with sending personal or credit card information over the internet.
Low-income Internet Users and Online Shopping
Are somewhat less likely to purchase things online is not too much of a surprise, as
those with lower incomes might be expected to be less active shoppers generally. In
fact, low-income Americans – defined in this survey as those who reported household
incomes of less than $25,000 annually – are less frequent shoppers than the more
well-off.
Some 56% of low-income Americans go shopping once a week or more often, while
63% of those whose annual household incomes are over $60,000 annually shop once
a week or more often.
Low-income online Americans generally are less likely to use the internet for the range
of online shopping activities about which we queried. Compared to upper-income
internet users, they are half as likely on a typical day to do something relating to
shopping on the internet.
51
52. It is important to keep in mind that online access varies by household income. Although
low-income internet users are nearly as likely as high income ones to have ever done
any of the online shopping activities listed, all low-income Americans are less likely to
have done them. This is because their internet access rate is about half that of upper-
income Americans.
52
53. Notwithstanding these patterns of access and use of the internet to shop, certain
features of online shopping might make using the internet for shopping very attractive
to low-income people. As sociologists who study the poor have noted, being poor often
means spending more time to carry out tasks many of those with higher incomes take
for granted.7 Dependence on public transportation means it takes longer to get from
point to point. Low-wage jobs generally have less flexibility for dealing with medical or
child care problems, which creates time pressures in dealing with work- versus
personal time trade-offs. Low-income people might also be expected to benefit most
from finding bargains online – something half the online population sees as a benefit of
using the internet to shop.
53
54. Low-income people are more likely than the well-off to see
the risks of sending personal and credit card information
online, and less likely to see the benefits.
Although the convenience and time-saving benefits of online shopping help most
people overcome worries about security, the way people weigh the convenience versus
safety trade-off varies by socio-economic status.
The share of internet users who express worries about sending credit card or personal
information over the internet is about the same as the proportion of users who say
online shopping is convenient – the numbers are 75% and 78%. When focusing only on
those who “strongly agree” with propositions about security and convenience, the
picture is a bit different: 36% of respondents strongly agree that they don’t like sending
personal or credit card information online, while 25% strongly agree that online
shopping is convenient and 21% strongly agree that it saves them time. Rendering the
data differently, 31% of internet users either strong agree that the internet is a
convenient place to shop or save them time.
However the data are parsed, the message is clear: In general, people have worries
about sending personal or credit card information online, but those concerns are
balanced by the convenience and time-saving that go along with online shopping. For
most online users, the scales tip toward going ahead and doing an online purchase.
Notably, though, this rough parity in attitudes does not apply to those who sit at either
end of the income distribution. For lower-income people – the 15% of online users
whose annual household incomes are below $25,000 – the internet is more likely to be
seen as a place where sending credit card or personal information is more troublesome
than it is a convenience for shopping. The pattern reverses when looking at upper
income Americans, the 15% of online users whose household incomes exceed
$100,000 annually. Upper income Americans are more likely to herald the time-saving
or convenience benefits of online buying and are less likely to see the risks of online
transactions.
People have worries about sending personal or credit card information online, but for
most online users they are outweighed by the convenience and time-saving benefits of
online shopping.
Focusing on the percentage of people who strongly agree with these propositions, 44%
of low-income Americans say they strongly agree that they don’t like sending personal
information or credit card numbers over the internet. Half that number – 22% – of
Americans with household incomes below $25,000 annually, strongly agree that online
shopping is convenient. For upper income Americans – household where the annual
income exceeds $100,000 – one quarter (25%) feel strongly in their concerns about
sending personal information over the internet, while a greater number (36%) say they
find online shopping convenient.
54
55. The same pattern emerges for attitudes about the time-saving potential of online
shopping. Nearly one-third of high-income people strongly agree that online shopping
saves time, while roughly one-fifth of middle and lower income online users say this.
The differences in attitudes about online shopping at either end of the income spectrum
show up in other ways. Low-income Americans are far more likely than high-income
Americans to say they have become frustrated by the lack of information or their
inability to find it while shopping online.
Some 56% of Americans whose household incomes are under $25,000 per year say
they have felt this frustration compared to 36% of those in households whose incomes
exceed $100,000 annually who say this. Similar differences for those in these income
categories are evident when respondents are asked about confusion or feelings of
being overwhelmed by the amount of information they find online.
55
56. If it is true that the internet saves time on shopping and can help turn up bargains, then
one might expect low-income people, whose time and money may be most scarce, to
embrace it. But the data do not show that this is the case for low-income Americans. As
the preceding analysis shows, low-income people assess the risks and rewards of
online commerce differently than upper-income people. They are more likely to see
potential hazards and less likely to see the benefits.
56
57. RESULTS AND ANALYSIS
Based on the type of data collected and the target segment with the appropriate
statistical methods, inference should be made. The response set of one variable is
compared with another set of variable to ensure a detailed analysis of data.
One should be able to recognize what type of data is appropriate for each statistic and
one should be able to recognize the level of measurement for the scales that you are
analyzing.
• Data Analysis done with the help of various IT tools like MS Excel and
SPSS Software
• Frequency distribution tables and Graphs.
AGE
Age
below 20
20-24
25-34
35-39
40 and above
Figure 1
57
58. ANALYSIS
Majority of the respondents in our survey consisted of people in the age group of 20-24
which was 47.60% and between 25-34 which was 43%. 3.20% respondents were in
the age group 35-39 while below 20 age group had 2.60% respondents.
GENDER
Gender
Male
Female
Pies show counts
Figure 2
ANALYSIS
We were surprised to find out that out of total respondents who filled out the
questionnaire male to female ratio was almost equal which depicted that females were
equally interested like males to fill out the questionnaire which says about their keen
interest towards search engines. Moreover, we can also say that women are at par with
men.
58
59. CITY
0.80%
3.20%
11.20%
2.80% 26.20%
1.80%
18.00%
City
Agra Hyderabad
0.80% 2.40% Ahmedabad Jaipur
Bangalore Kolkata
3.20%
Chennai Lucknow
0.80%
2.40% Chandigarh Mumbai
4.80% Delhi Noida
20.00% Faridabad Pune
0.80% Gurgaon Others
0.80%
Figure 3
ANALYSIS
We carried on our survey both online and offline in around 25 cities like Delhi,
Gurgaon, Noida, Indore, Mumbai, Chennai, Ahmedabad, Bangalore, and other cities
across India. While Off liners in Abn-Amro bank-noida, Amity University, Fidelity-
gurgoan, Hcl-noida.
59
60. EDUCATION
Figure 4
125
100
Count
75
50
25
Under Graduate Graduate Post Graduate
Education
ANALYSIS
Out of the people whom we targeted highest number of responses came from post
graduates which was followed by graduates and then the under graduates which shows
the decreasing trend of awareness.
60
61. OCCUPATION
40
30
20
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om
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Occupation
Figure 5
ANALYSIS
The maximum respondents were students who were keen to fill out the questionnaires
which show their level of curiosity in search engines. These were followed by
advertising, IT, educations which was further followed by researchers, managers and
marketing people.
61
63. Some interesting facts :
44% of Internet users believe that a film's online participation influences
their judgment in watching a movie reinforcing the need for movie houses
to be present online.
73% of Internet users spend less than Rs 500 on a visit to the cinema
indicating an affluent demographic. The 18-35 age group are the biggest
spenders.
33% of Internet users have a penchant to buy movie merchandise online
& this frequency is likely to grow as we are reaching to households
owning DVD Players & Recorders (35%), VCD Players (56%)
94% of users are susceptible to mobile marketing. Moreover, there is high
propensity to talk, share amongst friends.
47% of Internet users would pay for mobile content like alerts, ringtones,
wallpaper etc.
The results of a survey of global chief executive officers portend significant Internet
growth and business usage over the next five years, with 92 percent of executives
projecting revenues derived from E-commerce. Although the information technology
63
64. that supports electronic marketing currently accounts for just 8 percent of the United
States’ total economic output, over the last five years it has fueled more than one-third
of economic growth in the United States. The remarkable growth and impact of the
Internet and World Wide Web have spurred almost every business to explore E-
marketing strategies to enrich relationships with customers, employees, and suppliers.
In fact, the characteristics and availability of the E-commerce infrastructure are driving
strategic planning.
Internet marketing to simply equate to Search Engine Marketing, but while this is
important this scope is too narrow to take full advantage of digital media.
These techniques are used to support objectives of acquiring new customers and
providing services to existing customers that help develop the customer relationship.
However, for Internet marketing to be successful there is still a necessity for integration
of these techniques with traditional media such as print, TV and direct mail. This is
multi-channel E-marketing.
Online shopping or online retailing is a form of electronic commerce which allow
consumers to directly buy goods or services from a seller over the Internet without
intermediary service. Other names for an online shop are: e-shop, e-store, Internet
shop, web-shop, web-store, online store, and virtual store. The concept of an online
scope evokes the physical analogy of buying products or services at a bricks-and-
mortar retailer or shopping center; the process is called business-to-consumer (B2C)
online shopping. In the case where a business buys from another business, the
process is called business-to-business (B2B) online shopping. The largest of these
online retailing corporations are E-Bay and Amazon.com, both of which are based in
the United States.
Online customers must have access to the internet and a valid method of payment in
order to complete a transaction.
Generally, higher levels of education, occupation of the head of the household and
income correspond to more favorable perceptions of shopping online. Increased
64
65. exposure to technology also increases the probability of developing favorable attitudes
towards new shopping channels.
In a December 2011 study, Equation Research found that 87% of tablet users made
online transactions with their tablet devices during the early holiday shopping season
Users between the age of 18-35 are the biggest segment in India accounting for 50% of
all users on the Internet.
65
66. A Taxonomy of Consumer Online Shopping Attitudes
and Behavior
A total of 35 empirical studies are analyzed in this study. Of these, 29 of them used
survey method. Other research methods such as lab experiments and free simulation
experiments are occasionally employed. Each of these studies addresses some aspect
of online shopping attitudes and behavior. Our goal is to develop a taxonomy
representing factors/aspects related to online shopping attitudes and behavior covered
in the existing empirical IS literature.
After examining the 35 empirical studies, we identify a total of ten interrelated factors
for which the empirical evidences show significant relationships. These ten factors are
external environment, demographics, personal characteristics, vender/service/ product
characteristics, attitude towards online shopping, intention to shop online, online
shopping decision making, online purchasing, and consumer satisfaction. Five (external
environment, demographics, personal characteristics, vendor/service/product
characteristics, and website quality) are found to be ordinarily independent and five
(attitude toward online shopping, intention to shop online, decision making, online
purchasing, and consumer satisfaction) are ordinarily dependent variables in the
empirical.
• External
• Environment
• Demographics
• Personal
• Characteristics
• Vender/Service/
• Product
66
67. • Characteristics
• Website
• Quality
• Attitude
• towards
• Online
• Shopping
• Consumer Satisfaction
• Intention
• to Shop
• Online
• Decision
• Making
• Online
• Purchasing
• Antecedents
Few of the 35 studies examined cover all ten factors, and there is some inconsistency
in the empirical results of those that include similar factors. Nevertheless, for the sake
of discussion, we integrate these ten factors in a model (Figure 1) in which the
expected relationships among them are depicted. The five factors identified as
antecedents are normally independent variables, although some studies have treated
67
68. Website Quality as a dependent variable. These five factors directly determine attitude
towards online shopping. Attitude and intention to shop online have been clearly
identified and relatively widely studied in the existing empirical literature. Decision-
making is the stage before consumers commit to online transaction or purchasing, and
is sometimes considered to be a behavioral stage. The depicted relationships among
attitude, intention, decision-making, and online purchasing are based on the theory of
reasoned action (Fishbein and Ajzen 1975), which attempts to explain the relationship
between beliefs, attitudes, intentions, and actual behavior. Consumer satisfaction is
considered to be a separate factor in this study. It can occur at all possible stages
depending on consumers. involvement during the online shopping process. The
relationships between satisfaction, attitude, intention, decision making and online
purchasing are proposed to be two-way relationships due to the reciprocal influences of
each on the other. In addition, two of the antecedents, vendor/service/product
characteristics and Website quality, have been found to have direct impact on
consumer satisfaction.
External Environment
Only two out of 35 studies discuss the influence of external environment on online
shopping. External environment refers to those contextual factors that impact
consumers. online shopping attitudes and behavior. It includes three dimensions. The
first is the existing legal framework that protects the consumers from any kind of loss in
online transactions. The second is the system of the Third Party Recognition in which
many third party certification bodies are working to ensure the trustworthiness of online
vendors (Borchers 2001). These two factors are positively associated with consumers.
trust attitude to the online stores. The third factor is the numbers of competitors, which
can be defined as .the number of Internet stores that provide the same service and
products. (Lee et al. 2000, p.307). Lee and colleagues (2000) argue that the fewer the
competing vendors, the greater the possibility of opportunistic behavior on the part of
68
69. existing vendors so as to maximize profits. This increases transaction costs for the
consumer, decreasing intention to revisit a specific online store.
Demographics
Eight of 35 studies examine the impact of demographics on online shopping attitudes
and behavior. Demographics include such variables as age, gender, level of education,
income, and time online. Bellman and colleagues (1999, p. 33) report that .Internet Li &
Zhang/Consumer Online Shopping Attitudes & Behavior 2002 . Eighth Americas
Conference on Information Systems 511 surveys agree that the online population is
relatively younger, more educated, wealthier, although the gaps are gradually closing..
They argue that demographics appear to play an important role in determining whether
people use the Internet, however once people are online, demographics do not seem to
be key factors affecting purchase decisions or shopping behavior. Bhatnagar and
colleagues (2000) provide evidence that demographics are not relevant factors in
determining which store to patronize or how much to spend, though men and women
do tend to buy different types of products or services via the Internet. In summary, the
literature suggests that the impact of demographics on Internet buying behavior is not
strong.
Personal Characteristics
Personal characteristics have drawn the attention of fourteen studies. It can be defined
as a group of specific customer features that may influence their online shopping
attitudes and behavior, such as their Internet knowledge, need specificity, and cultural
environment.
Li and colleagues (1999) found that customers who purchase Internet stores more
frequently are more convenience-oriented and less experience-oriented. These
consumers regard convenience during shopping as the most important factor in
purchase decisions, because they are time-constrained and do not mind buying
69
