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Chapter-1 Introduction

1. Introduction:

In the early fifties, the project RAND was introduced which aided the

researchers to contact from one place to the other. Then it was in 1960

when computers were used for commercial applications. Bank of America

was the first too use it for commercial purpose. The main notion of

internet was designed by APRANET, which was formed by the United

States Department of Defence and was regarded as the worlds first

operational package switching network. In 1970 the APRANET developed

the Network control protocol. In late 1970s and 80s businesses extended

their computing power by sending and receiving information electronically

via EDI (Electronic Data Interchange). Thereby, eliminated paperwork and

human intervention. (E-Commerce Guides Ask the Experts, 1998).

Todays reformation of EDI is through internet to reduce the cost of

networking by eliminating old systems private network and by expanding

reach to include more businesses in supply chain. After that in 1984 ASC

X 12 standards established a means of transferring data whose

misutilisation leads to popularity of e-commerce.

But e-commerce relating to shopping was only open since 1991 when

internet was opened to commercial use. And since then, the power of

buying products online has been a gift to the customers. The origin of

Napster helped in gaining more popularity in the field of e-commerce. The

next giant leap was the incident of merging between AOL and Time

Warner. This was a major hit and it was referred to as the E-age. The

companies were thinking of various innovative ways to reach nearest tothe customers, so that the customers feel safe in transacting through

online. But suddenly the hackers attack to the most popular sites like

yahoo, msn, eBay, and Amazon etc, slightly discouraged the customers

from holding online transfers. Initially the e-commerce market was a

monopolistic market since statistics say tat the companies concerned with

these business sold 80% routers and 90% of web browsers but this figure

showed a drastic downfall from 160 to 14 especially in the US market. It

was seen that the Asia and Pacific accounted for a 46% of the total online

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subscribers in the whole world. In the later half of the report, we will

discuss about the scope of ecommerce in the Indian, Srilankan, or

Pakistan market and the detailed of it in the statistical form. Till 1997, in

India, internet was introduced to channelize between the government

agencies and various departments with the only purpose of education and

research.

In the late periods of 1995, the VSNL (Videsh Sanchar Nigam Limited)

was emerged which acted as the ISP (Internet service Provider) in all the

four metros in India. It expanded its reach to 100 cities in India with Dial-

up services. Though India has a base of 8,00,000 in 2004, the major

concern was the amount that had been sold in that base. This figure gave

an actual realistic shape after a survey report was published citing the

various category of users and calculated percentage mentioned along with

it and it was seen that a mere 21 million used internets once in a month.

The internet usage stats and telecommunication research showed that

22% of Indians use internet for jobsearch, 14% for banking, and 42% of

the active users use it for emails and IM. Besides this a small figure of 7%

use it for matrimony search, and 7%in stock trading.

The IT development in Pakistan emerged in the year 2000 but the main

purpose for this introduction was mainly facilitating the government in

their work. The common people used internet for information only. None

of the monitory transaction was possible then. The e-merchants handled

their accounts State Bank of Pakistan. Hence the Pakistan government

thought of relocating US $10 billion between the years 2005-2006. In

2005, the figures were about 2.1 million internet subscribers with an

average of 10million users. The main Internet Service Provider (ISP) was

SNDP in the year 1996 yet the largest one was PakNet. The status of e-

commerce in Pakistan is much undeveloped. People have limited usage of

debit cards and Plastic money, very limited online banking, still on the

verge of facilitating e-payments and utility bills. Due to the very low

telephone line penetration, the availability of broad band connection was

quite low.

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Starting with Ajzen and Fishbeins Theory of Reasoned Action (TRA) in

1967, where they for the first time introduced Attitude, Subjective Norm

and Behavioural Intention at the same platform. The main point of

introducing this theory was to find out the factors affecting the

Behavioural Intentions of a person. The factors they pointed were Attitude

and Subjective Norm.

But there was still a missing link. They found out it to be the Perceived

Behavioural Control. They also found that there is a common sub factor

affecting these three factors. And that is belief. They disintegrated beliefs

into three types (Behavioural Beliefs, Normative Belief and Control Beliefs)

and associated each with the three factors, Attitude, Subjective Norm and

Perceived Behavioural Control. On this basis they formed a new theory in

1988, The Theory of Planned Behaviour (TPB).

Just a year later in 1999 came Fred Davis, with his theory, The

Technology Acceptance Model (TAM). This was a very competent model

but focussed mainly on the Behavioural Intention only a part of the TRA.

But he neglected the other part that is the Subjective Norm. As the name

suggests, he focussed mainly on the Technological aspects associated with

the Transaction Intentions. He proposed few factors which affected the

Behavioural Attitude. The Main three sub factors affecting Attitude

towards using were Perceived Usefulness, Perceived Ease of Use and

External Factors. Still this model wont suffice the purpose of this research

as it doesnt include the cultural traits.

Then came Venkatesh with his model Unified Theory of Acceptance and Use

of Technology (UTAUT) 2003. This theory stands on mainly four functions

which are considered as direct determinants for the usage of behaviour viz.

a) performance expectancy

b) effort expectancy

c) social influence

d) Facilitating conditions.

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The following points are these which mediate the impact of these four key

which construct on differentiation and behaviour such as follows:

Gender, age, usage, and voluntaries of usage.

But all of them did lack something. And that is the effect of Cultural Traits.

Pavlou and Chai (2002) came up with a conceptual model where they

included three of the cultural traits proposed by Hofstede. Hofstedes Cultural

Model (1994), proposed five main traits and they were, Power Distance,

Long-Term vs. Short Term Orientation, Individualism/Collectivism, Femininity

vs. Masculinity and Uncertainty Avoidance. In order to devise a model

inculcating the earlier theories with culture, it was necessary to improvise

them within themselves. The idea is simple, if trust can affect the transaction

intentions (online), why cant Social Influence? Even it might be possible that

the Collectivism can affect Social Influence. So, the need to set a stage for all

these factors to come together had become very important. Since, the

research question in itself is trying to correlate culture with technology

selecting a single trait could be insufficient. At the same time focusing more

on a single cultural trait (out of five as proposed by Hofstede) could find more

and detailed correlations with the other vital factors affecting technology.

Being defined the requirements and the dimensional boundaries of this

research; the quest for such a model was extensive. One way of doing it

in a focused way could be to pick up one of the cultural traits of Hofstede

and mapping (Correlating) it with the other functional variables proposed

by Pavlou and Chai. Pavlou and Chais proposed model contained

Collectivism vs. Individualism, Power Distance and Long vs. Short Term

Orientation. This research will only focus on one of them and that is,

Collectivism vs. Individualism. So, in other words, this research will

propose a model focusing on one of the cultural traits proposed by

Hofstede and will try to correlate it with the previous conventional

theories.

The primary research will undergo a questionnaire where the answerswould reveal the correlations. Another way of cross checking the

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correlations could be searched in the theories of Cognitive Psychology. A

very exciting work done in this ground is done by Rapaille. He tries to

associate a code which he calls as culture code to every thing. This piece

of research will also try to imitate the underlying point. And that is, the

real answers lie in the subconscious mind. An interview will reveal

answers from the subconscious mind by asking for giving quick and

prompt answers so that the answers come from the subconscious mind

only.

Another relevant question might arise that If the Psychology of the

Students from Indian Subcontinents would change then, how would they

try to induce their thoughts or trust in their family members about

transacting online? This is one of the research objectives of this research.

One of the questions in the questionnaire will deal with this objective.

All the answers would be weighed and evaluated on an ordinal scale

through SPSS.

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Since then, the potential of internet has reached to such extent that,

today it is probably one of the strongest media we ever had. The increase

in its utility has grown many folds giving rise to multiple environment

system on the internet. A wide variety of applications are available now.

Be it a simple e-mail, chat, or information gathering, it serves a several

millions of people everyday. One of its traits which are growing its

popularity very fast is shopping on the internet. We sometimes call it e-

Commerce. Although e-Commerce in itself has many sub environments

such as Shopping grocery, clothes or electronic goods or online bank

transactions. This research paper will deal with the question of change in

the psychology of Indian Subcontinent Students studying here and its

effects on their family in their countries about e-shopping only.

The history of e-Commerce started in 1968, when for the first time the E-

Commerce started with a basic EDI (Electronic Data Interchange) format

which enabled the business men to interchange data between one another

and perform a kind of B2B transaction. Although the format was too basic

as was the idea but still, it was only the beginning. Todays world

experience a very new and efficient format but still, Kerry Stackpole (CEO,

Data Interchange Standard Association) considers EDI to be a sort of

invisible technology and is really at the core of most productivity

improvements of the last half of the century. (Wiseman J; 22nd August,

2000)

In 1984, ASC X 12 standards established itself as a reliable means of

transferring data with a larger potential. But unfortunately the over

utilisation of this standard increased the e-traffic which in turn increased

the popularity of e-commerce.

In 1994, the search for a more user friendly and point to click browser

interface ended with the evolvement of a Mosaic browser called Netscape.

This was more user friendly with options to download and point and click

devices. The downloadable features of this new browser made it

immensely popular among the audience because it was very simple and

they did not need any computer programmer to download software. Thisrevolution might be considered as a great point of achievement for the E-

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commerce history as this technology burp gave the common people the

power to go online and experience different applications and spread their

wings by trying new things online. This was a great step towards the B2C

transactions.

It was in May 1998, when SBS Communications for the first time in

California extended their DSL cables to ADSL (Asymmetric Digital

Subscriber Line) and gave them the experience of trying a 50 times faster

bandwidth than what they were using (28.8 kbps). (Wiseman J; 22nd

August, 2000)

Another major step towards the popularity of E-commerce was the

evolution of Napster in 1999, which allowed the audience to download

music files for free. This led a greater audience towards E-Commerce

since this increased the curiosity and generosity to go online and

download their favourite things.

Another big leap towards the road to success was the Merger between

AOL (America Online) and Time Warner in 2000. The entertainment giant

merged with a new electronic media giant with a base of 24 million

customers at that time. This is a very good example of foresightedness

Time Warner had that time. They got the pulse of the future and recon

that it is E-age and the only way to grow is by adopting the technology to

improve quality and customer reach.

All these events were proving to be good for encouraging people to

transact online which was growing every day but, on 7th February 2000

the mass attack on the e-commerce giants such as Yahoo, e-Bay and

Amazon by the hackers set the common man into confusion whether it

was safe at all to transact online or not. This was a major setback to this

growing trade.

It was seen that the whole Industry is almost under Monopoly or at least

under huge Oligopolistic pressure. In a development report published in2001 in the United Nations Conference on Trade and Development in

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2.1 Development of e-Commerce in Indian Subcontinent:

2.1.1 Development of e-Commerce in India:

Country Profile:

India is a very big country having a large area of around 3,287,590 sq.

km. in Southern Asia bordering the Arabian Sea and the Bay of Bengal. It

is a very heavily populated country of about 1,129,866, 154 person. The

literacy rate is as high as 61%. (CIA Fact Book) [Online] Available from:

https://www.cia.gov/library/publications/the-world-factbook/geos/in.html

The history of internet in India started with an initial approach from a

division of Department of Electronics and Department of Statistics called

as ERNet and NICNet. While ERNet (Education and Research Network) was

basically responsible for providing Internet services to the Education and

Research Institutes, NICNet was dealing with connecting Government

departments and agencies. In the year 1993, the director of ERNet Dr. S.

Ramakrishnan developed a command based user Interface which did not

used the TCP-IP network Protocols. This was called SHELL. It again

developed to UUCP (Unix to Unix Copy Programme) which was because

the connection reliability was still poor.

For the first time in 1996, the whole system was upgraded to a nationwide

V-SAT (Very Small Aperture Terminal) which was the first satellite based

digital communication system in INDIA. Although the speed was only

2400 BPS initially but within a year the speed was increased by 64 KBPS

V-SAT links.

The main focus of introducing internet in INDIA till 1997 was to

communicate between Government Agencies and Departments and for the

purpose of Education and Research. The main point to observe here is the

common people in the country was still not aware of all this techno-

revolution going on as they never felt its use to them. Since ERNet and

NICNet were under the Department of Telecommunications (DoT) whichwas run by the Government of INDIA, they had to rely on the Government

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policies. This could be considered as a mean of restriction in spite of being

the first ISPs of INDIA. (Ghosh A; 1998)

The advent of VSNL (Videsh Sanchar Nigam Limited.) in the late 1995 as

an ISP was a huge hope, since it was providing internet services to STPI

(Software Technology Parks of INDIA) by launching the GATEWAY

INTERNET ACCESS SERVICE. But it was also acting under the DoT

(indirectly the Govt. of INDIA) which gave him the licence to go public

only in four Metro Cities. The charter with the DoT was only to provide

International Telecom Gateways but not the end-user services. That

means a common man still was starving for Internet.

In a press release in the year 2004 VSNL stated that it has extended its

reach of Dial-Up internet connection services to 100 cities in INDIA. The

starter packs costing between Rs.100 to Rs. 3,000 depending upon the

needs and internet hours. This may imply that the concept of high speed

broadband was still missing even at that point of time. Being the main ISP

of INDIA VSNL has a customer base of over 8,00,000 in 2004 alone. But

the main lookout is how many of them buy its internet services and up to

what extent. (VSNL; August 17, 2004, Press Release, VSNL Extends

Reach of Dial-Up Internet Service to Over 100 Cities,

http://www.vsnl.in/vsnlnews/PR_Dial-up_Internet_17-08-04.pdf)

In a summary report published in 2006 by IMRB International and IAMAI

it was revealed that the active users using internet was just over 21

million. The definition set by the board for Active User is someone who

has used the internet at least once in the last one month. A survey was

conducted including 16,500 households, 1000 business houses and 250

cyber caf owners across 28 major metropolitan cities in INDIA. Being so

huge and broad in its nature it is being considered as one of its kind. They

revealed a data of people connecting internet and suggested that it looks

like a funnel to get the real users.

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FIGURE-1 THE INTERNET USERS FUNNEL

Urban Popula tion - 243 mill ion

Literate Population - 203 million

English Knowing - 77 million

PC Literate - 59 million

Ever User 32 million

Active User-

21 million

Internet in India-2006; Summary Report of I-Cube 2006, p.8

It was observed that only 55% of the PC literate people have experienced

the Internet. The development in internet users was shown in a graph in

the summit.

FIGURE-2 PERCENTAGE OF ACTIVE INTERNET USERS


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An interesting fact was also this that the percentage of people owning PCs

and have internet as well is increasing.

FIGURE-3 PERCENTAGE OF PC OWNERS HAVING INTERNET


Although the Cyber Cafs are still dominating as the access points for

Internet, Home usage is not far behind. The graph shown below clearly

demonstrates that the use of cyber cafes have decreased from 43% to

39% in just 6 years. Although looking at the number of years it might look

weak but, the home usage increased from 22% in 2000 to 31% in 2006.

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FIGURE-4 GROWTH OF ACCESS POINTS OF INTERNET USAGE

43%

30%

22%

5%0%

44%

19%

30%

4%3%

52%

20%

23%

3%2%

46%

20%

27%

5%2%

39%

22%

31%

6%2%

0%

10%

20%

30%

40%

50%

60%

70%

80%

90%

100%

2000 2001 2003 2004 2006

Access Points for Interne

Cyber Caf Office Home School/College Others

Adopted from Internet in India-2006; Summary Report of I-Cube 2006

The committee recognised six main demographics that use the internet.

FIGURE-5 SIX DEMOGRAPHICS USING INTERNET IN INDIA

Internet Usage Demographically

Young Men

28%

School Kids

14%Working Women

9%

College Students

23%

Older Men

17%

Non-Working

Women

9%

Adopted from Internet in India-2006; Summary Report of I-Cube 2006

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The age of each component of the Demography was also explained as:

Young Men Less than 35 years

School Kids 12-17 years

Working Women- 18-45 years

College Students- 18-23 years

Older Men 35-58 years

Non-Working Women - More than 45 years.

The main inference that can be drawn here is the major contributor to the

internet usage is the Young Men and the College Students. Which can be

explained as the college students needs Internet for education, training

and communicate to their friend circles etc. The Young Men use Internet

mostly in the office for business purposes and for communicating each

other.

The 2.6 million Internet users in INDIA still rely on Dial-Up connection as

compared to Broadband connections. Only 23% of the 2.6 million internet

using population uses Broadband. Looking at the Development in India

alone in the last ten years in not very impressive, still the picture is

growing better. An argument can be drawn that the picture is looking

bright in future days to come, but still the main problem lies somewhere

else. At this age of technology favouring world, the neighbourhood is

becoming small. That is the world is getting smaller place to

communicate. The globalisation (both in terms of Business Resources and

Communication) is huge and getting bigger every day. So the main

problem becomes the growth rate. May it be e-Commerce or Economy,

Career or Architecture, the question lies in how quick it is going to grow

big as others. The data given by the Internet World Stats this year can

throw some light on the issue.

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Table: 1 Internet Usage and Population Statistics, India

YEAR Users Population % Pen. Usage Source

1998 1,400,000 1,094,870,677 0.1 % ITU

1999 2,800,000 1,094,870,677 0.3 % ITU

2000 5,500,000 1,094,870,677 0.5 % ITU2001 7,000,000 1,094,870,677 0.7 % ITU

2002 16,500,000 1,094,870,677 1.6 % ITU

2003 22,500,000 1,094,870,677 2.1 % ITU

2004 39,200,000 1,094,870,677 3.6 % C.I. Almanac

2005 50,600,000 1,112,225,812 4.5 % C.I. Almanac

2006 40,000,000 1,112,225,812 3.6 % IAMAI

2007 42,000,000 1,129,667,528 3.7 % IWS

Internet Usage Stats and Telecommunications Market Report. [Online

www.internetworldstats.com]

In a report published by IAMAI (Internet and Mobile Association of India)

in February, 2006 they mention the internet activities done by the Indians

as,

FIGURE-6 INTERNET ACTIVITIES BY INDIANS

Internet Activities by Indians

e-Mail & IM 42%

Job Search 22%

Banking 14%

Bill Payment 8%

Stock Trading 7%

Matrimony Search

7%

Internet Usage Stats and Telecommunications Market Report. [Online

www.internetworldstats.com]

Now, it would be better to summarise the development of e-Commerce by

dividing it into 3 phases:

a) Introductory Phase- Early 90s

b) Early Growth Phase- Mid 90sc) Growth Phase - Till Now

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FIGURE-7 GROWTH OF INTERNET USAGE SNAPSHOT

Information

search, Gaming,

Chat and E -mail,

E-Commerce

E-mail, Chatting,

Information

Search

E-mail,

Notifications

Applications

used

Multi -LingualEnglishEnglishInterface

Language

Branded Chains

of Cafe

Home Access

Cyber Caf

Limited Home

Access

Dial -UpsAccess Points

Smaller TownsSmall MetrosTop 8 MetrosTarget Segment

HighAverageLowAffordability

AdequateAverageLimitedAvailability

GrowthPhase

EarlyGrowth

Phase

IntroductionPhase

Parameters

Author Generated

2.1.2 Development of e-Commerce in Pakistan:

Pakistan is a small country in the Southern Asia bordering the Arabian

Sea. It has a coastline of around thousand km along the Arabian Sea. As

per World-Gazetteer the population of this country in 2007 was

167,806,831. GNI per capita was US$ 2,628 in 2006 as per World Bank.

The literacy rate is about 50% The inflation rate is one of the biggest

threats to the economy. The growth rate in the GDP was observed to be

6.6% as compared to last year.(https://www.cia.gov/library/publications/the-world-

factbook/geos/pk.html)

A somewhat clear picture can be obtained by looking at the statistics

provide by internetworldstats.com about the population, internet users

and the percentage penetration.

TABLE-2 INTERNET USERS vs. POPULATION IN PAKISTAN

YEAR Users Population % Pen. GDP p.c.* Usage Source

2000 133,900 163,985,373 0.1 % N/A ITU

2006 12,000,000 167,806,831 7.2 % US$ 690 ITU

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http://www.internetworldstats.com/asia/pk.htm

By looking at the above table it is evident that Pakistan being a smaller

country in the Indian Subcontinent the situation is even worse. The Govt.

started IT and Internet initiatives in early 2000 but still the main e-

infrastructure was to facilitate the Govt. agencies to communicate in an

easy way. The interfaces used by common man are to gather information

and not monitory transaction. One of the main monitory transactions that

happen till now is the foreign remittance to some banks. The e-merchant

accounts used by e-vendors were under State Bank of Pakistan till

2001.The poor usage of e-Commerce in Pakistan can be facilitated by the

poor IT and Communication Infrastructure. The Govt. decided to relocate

US $10 billion during the year 2005/2006. (The Economist Intelligence

Unit, 1st Nov 2006; Overview of e-commerce in Pakistan,

http://globaltechforum.eiu.com/index.asp?

layout=rich_story&doc_id=9616&title=Overview+of+e-

commerce+in+Pakistan&categoryid=30&channelid=4

As per the Govt. survey in 2005 there were about 2.1 million internet

subscribers and 10 million internet users by June 2005. In the beginning

of1993 the main ISP was SNDP (Sustainable Development Networking

Programme). The Govt. first allowed the licence to private owners in

1996. The largest ISP is PakNet.

In the same report a comparison of Pakistan vis--vis world relating the

internet usage and its capacity by means of ICT Infrastructure measure

and Human Capital measure was given.

FIGURE-8 INTERNET USAGE AND HUMAN DEVELOPMENT INDEX

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(Khushnood B, 2002; Initiatives for eCommerce Capacity-Building of

SMEs, http://www.unescap.org/tid/publication/part_three2261_pak.pdf)

FIGURE-9 ICT INFRASTRUCTURE DEVELOPMENT

(Khushnood B, 2002; Initiatives for eCommerce Capacity-Building of

SMEs, http://www.unescap.org/tid/publication/part_three2261_pak.pdf)

Status of e-Commerce till 2001 in Pakistan a snapshot:

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Limited usage of Debit Cards and Plastic Money.

Still facilitating e-Payments and utility bills.

Limited online banking due to non-availability of digital signatures.

None of the Connection Authority available.

No B2B e-Commerce infrastructure available.

(Khushnood B, 2002); [Online] Available from:

http://www.unescap.org/tid/publication/part_three2261_pak.pdf)

The fixed line penetration is just about 4% which is about 6.4 million

telephone lines, less than what was targeted (10 million). Since the

telepenetration is still so low, broadband is also experiencing negligible

growth.

(2007 Telecom, Mobile and Broadband in Asia Report. Pakistan,

Bangladesh, Maldives, Afghanistan and Sri Lanka). [Online] Available

from: http://www.budde.com.au/publications/annual/asia/afghanistan-

bangladesh-maldives-pakistan-sri-lanka-summary.html)

2.1.3 Development of e-Commerce in Sri Lanka:

Sri Lanka is a very small country located at about 31 km. off the Southern

coast of India. Being a link between the West and South-East Asia the

place is renowned for its Buddhist and Hindu culture. The approximate

land area is about 65,610 sq. km. with a population of 19,796,874 in

2007 (World-Gazetteer). As per the data of World Bank the GNI per capita

in 2006 was US$ 1,310. The main language is Sinhalese and Tamil. Only

10% of the population speaks English. In the last 10 years the GDP

growth was just 4.5 %. There are about 2.087 million Telephone lines in

use accounting for 4,26,000 Internet Users. (CIA Fact Book) [Online]

Available from:

https://www.cia.gov/library/publications/the-world-factbook/geos/ce.html

In a report published by Sri Lanka Business Development centre reveals

that, about 80% of the SMEs use internet for business. As a matter offact, this rate has grown in the last three years since, 63% out of 67

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companies are using it for the last three years. It was found out that 75%

of the employees use internet for less than an hour in a day even after

having facilities to be online. This shows the disbelief of Internet as a tool

for growing business. The light of hope is that, about 46% of the SMEs

communicate daily with their customers through e-mails. Most of the

connections being popular today are Dial-Ups still. The survey showed

that ISDN lines are way far behind the competition.

FIGURE-10 PERCENTAGE OF DIAL UPS vs. ISDN IN SRI-LANKA

Types of Connection

Dial Up

66%

ISDN

9%

Leased Line

24%

Cable

1%

(SLBDC, June 2002; Survey on E-Commerce Implementation in the SME

Sector of Sri-Lanka,

http://www.asiafoundation.org/pdf/SMEsurvey_srilanka.pdf)

This data infers that the SMEs are not considering the Internet at least as

a tool to sell things, since it requires more bandwidth and dedicated

broadband lines to serve the internet traffic.

The most prominent hint to the e-commerce development there would be

the answer to the question that, why do the companies have their own

websites (only 51%)? The most popular answer (93%) was to promote

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their company to the potential customers. None of the answers depicted

Sell goods over the internet.

(SLBDC, June 2002; Survey on E-Commerce Implementation in the SME

Sector of Sri-Lanka,


With a total of 80 SMEs in the survey only 12.5% have ever sold their

goods on internet. The most popular method of transaction is Debit/Credit

Cards. And out of these SMEs only 30% sells 21-30% of their overall

sales volume through internet.

About 30% of the Internet availing community places order online. This is

in accordance with the previous data of the sales revenue.

TABLE-3 INTERNET USERS vs. POPULATION IN SRI-LANKA

YEAR Users Population % Pen. GDP p.c.*Usage

Source

2000 121,500 19,630,230 0.5 % N/A ITU

2007 428,000 19,796,874 2.2 % US$ 1,310 ITU

(SLBDC, June 2002; Survey on E-Commerce Implementation in the SMESector of Sri-Lanka,


After Looking at the E-Commerce development scenarios of each of

countries of the subcontinent it is evident that the pace required to keep

themselves updated to the recent world I clearly missing. It might be

because of the Psychology of the consumers. Hence, it would be a noble

try to find out how the Psychology of the Indian Subcontinent Students

have changed and might affect the behaviour of their family members

towards e-Commerce?

To study the Psychology of these subjects there would come many

theories but, to start with the basic one should be appropriate. That is the

Hofstedes Theory of Cultural Dependency.

2.2 The Culture Dependency:

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Apart from the different models suggested by different researchers to

relate Psychology and behaviour, there is still something left to be

understood. And that is culture. Although a part of it can be included in

the subjective norm and social experience but looking at it as an

independent factor can give the whole theory a new meaning. It is already

known that Human Behaviour is highly influenced by culture. Between

many theories Hofstedes models (1997) is a popular one. He focused

basically upon patterns of thinking, feeling and acting of customers. As

per him Culture is always a collective phenomenon, because it is al least

partly shared with people who live within the same social environment.

Although the early sociologists like Bourdieu thinks culture as the

collective programming of mind which distinguishes the members of one

group or category of people from another (Bourdieu, 1980; pp. 88-89)

1. Power distance: is one of the dimensions of national cultures, which

reflects the range of answers found in the various countries to the

basic question of how to handle the fact that the people are unequal.

In other words it is the extent by which the less powerful members of

organizations or a family accept that power is distributed unequally.

Hofstede also calculated a Power Distance Index for each country by

his famous IBM survey.

2. Individualism: is a quality present in every individual to a certain

extent. Many people live in societies and sometimes the interest of the

individual prevail over the interest of the group. That is why in some

societies the ties between people are loose eg; Nuclear Family. Most of

the people in UK dont live with their parents after a certain age. There

the Individualism Index (II) of the Societies is considered to be low.

Countries like India where people still believes in Joint Family have a

high II score.

3) Masculinity: is the distribution of roles between a male and a female.

This is the gender index in the culture tree. As per their respective

natures the assertive and competitive poles are called as Masculineand the modest poles are called as Feminine.

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4) Uncertainty: is the environments tolerance level for any uncertainty. It

is the level to which a certain group of people belonging to any society

can bear to any unstructured ambiguity. The level of un-comfortibility

is a measure of this index.

5) Long Term and short Term Orientation: are the two virtues by which

one can get to know the values of a society. The value associated with

the Long-Term orientation was Thrift and Perseverance whereas for

Short Term it was respect for Tradition and Fulfilling social obligations.

This theory by Hofstede was a very important reference to understand the

relationship between culture and its dependency. Although there are other

factors as well which affect the behaviour of a person.

2.3 Theory of Reasoned Action:

There were many theories which tried to find out the real psychology of a

customer to transact. Theories such as Theory of Reasoned Action, Theory

of Planned Behaviour, Technology Acceptance Model and United Theory of

Acceptance and Use of Technology have tried independent approaches to

justify the reason of the behaviours done by the customers. The earlystones were laid by Ajzen and Fishbein (1967) by introducing the Theory

of Reasoned Action.

This theory states that a persons behaviour is determined by their

attitude toward the outcome of that behaviour and by the opinions of the

persons social environment. They suggested that behaviour is driven by

behavioural intentions where behavioural intentions were a function of an

individuals approach/attitude towards the behaviour and subjective

norms surrounding the performance of behaviour.

Now while going into the theories of human psychology of buying or even

behaving some terms must be understood well. Terms such as Subjective

Norms, Attitude etc. should be understood well in order to get the real

meaning of these theories.

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Attitude has been defined by many researchers in different lights. But in

a more generalised way it can be defined as the feelings of an individual

(be it positive or negative) associated with the performance of the

behaviour. It is believed that there are certain beliefs responsible for the

attitude and the results of the attitude being evaluated from the sum of

the individual consequence x desirability assessments for all expected

consequences of the behaviour.

Subjective Norm was first introduced by Ajzen and Fishbein (1967) in

their first model the TRA. This was basically an individual's perception of

whether people important to the individual think the behaviour should be

performed. Hence, overall subjective norm can be expressed as the sum

of the individual perception x motivation assessments for all relevant

referents.

Algebraically TRA can be described as

B I = (Aact) w1 + (SN) w2

Where,

B = Behaviour,

I = Intention,

Aact = Attitude towards the behaviour,

SN = Influence of the persons Subjective Norms

Diagrammatically, this can be represented as

FIGURE-11 TRA

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Fishbein, M., & Ajzen, I. (1975). Belief, attitude, intention, and behaviour:

An introduction to theory and research. Reading, Mass.; Don Mills,

Ontario: Addison-Wesley Pub. Co.

In this theory the intention plays a key role in predicting someones

behaviour. Although the factors that determine the Behavioural Intentions

are Subjective Norms and Attitude towards the Behaviour. The main

limitation of this theory was no observation was used from a different

perspective but only self reported is counted as a factor for deciding the

results. It might be possible in some cases that the answers might be

framed or distorted by some compulsions. Also, the behaviour done un-

consciously is not taken into account.

2.4 Introduction of TPB:

Understanding this problem Ajzen and Fishbein (1988) further extended

their research and landed up with the Theory of Planned Behaviour in

1988. This time the model was almost the same but with the inclusion of

the sub-factors affecting the factors towards the intention to behave and a

new factor called Perceived Behavioural Control. Ajzens intention was to

capture motivational factors that influence the behaviour. (Ajzen 1991,

pp. 181)

FIGURE-12 THEORY OF PLANNED BEHAVIOUR

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Adopted from http://www.people.umass.edu/aizen/tpb.diag.html

The changes in TPB from TRA are shown by the shaded area in the figure.

The sub-factors influencing the factors were clearly identified in this

model. Hence, this model was more prepared to deal with the current

world scenarios and more importantly a clear guideline was given to

implement the model to decide the reason of doing a particular behaviour.

As per the Theory of Planned Behaviour, human action is controlled by

three types of considerations which are categorised as:

a) Behavioural beliefs (beliefs about likely consequences of the

behaviour).

b) Normative beliefs (beliefs about normative expectations of others).

c) Control beliefs (beliefs regarding presence of factors which

facilitates or impede behavioural performance).

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Behavioural Beliefs are the beliefs about the probable consequences of

the most likely behaviour. It might be considered as the probable result of

the final behaviour and influences the Attitude towards Behaviour.

Attitude Towards a Behaviour is basically the degree to which the

performance of the behaviour is valued as a Positive or Negative

behaviour. This is directly proportional to the strength of the belief and

evaluation of the outcome of the behaviour.

A bjej

Where,

A= Attitude.

b=Strength of each belief.

e= Evaluation of the outcome of the behaviour.

Normative Beliefs are the beliefs whichrefer to the perceived behavioural

expectations of such important referent individuals/groups such as Friends,

Relatives etc. In this paper the normative belief could be the belief of the

subjects (Indian Subcontinent Students in U.K) that since they have found

the advantages of e-Commerce, their family and friends back in their country

could also become interested towards it.

Subjective Norm is the apparent communal obligation to decide engage

or not to engage in the behaviour. In this case it is the opportunity and

adventurous experience (for those who have not done this in their

country) to indulge in purchasing online. Lack of time here can also be

considered as a Subjective Norm in this case. This can be calculated as,

SN njmj

Where,

SN= Subjective Norm.

n = Normative Belief.

m= Motivation to Comply.

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Control Beliefs are the perceived beliefs whose presence may assist or

impede performance of behaviour.

Perceived Behavioural Control is the perception of an individual about

his ability to perform a given set of behaviour. It is of two types the first is

about self-efficacy and the second is the conditions that provide the

resources to engage in a behaviour. (Triandis, 1979) This can be

calculated as,

PBC cjpj

Where,

PBC = Perceived Behavioural Control.

c = Control Belief.

p = perceived Power.

Intention is the readiness of an individual to perform a given behaviour

and is considered to be an immediate antecedent of behaviour.

Behaviour is the manifest, observable response in a given situation with

respect to a given target.

Although researchers such as Bagozzi and Burnkrant (1979); Di Tecco and

Schlegel (1982); believed that behavioural intensions were independent of

the effect of attitudes. It would also be a lookout that the belief

structures are too complex to be captured in numbers or in writing. It

would be hard to refer someones belief strengths in numbers.

2.5 Introducing TAM:

In the year 1989 Fred Davis came up with the idea of how the ease of

using a technology influences the intention and attitude to do behaviour.

All the previous models were trying to measure the behavioural intentionsto use internet based shopping experience. The main idea of

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implementing this model was to understand the relationship between the

main idea of internet shopping behaviour and the external factors other

than the human psychology. Before Davis (1989), Ajzen and Fishbein

(1967) dealt with the psychological part of the consumer behaviour and

attitude towards e-shopping. Fred Davis for the first time included the

technological aspect of the behaviour and constructed a bridge between

technology and psychology. The main intention was to include the

technological constraints, time constraints and the ease of use constraints

into the earlier model (Bagozzi et al; 1992). As Warshaw and David said

Because new technologies such as personal computers are complex and

an element of uncertainty exists in the minds of decision makers with

respect to the successful adoption of them, people form attitudes and

intentions toward trying to learn to use the new technology prior to

initiating efforts directed at using. Attitudes towards usage and intentions

to use may be ill-formed or lacking in conviction or else may occur only

after preliminary strivings to learn to use the technology evolve. Thus,

actual usage may not be a direct or immediate consequence of such

attitudes and intentions. (Bagozzi et al; 1992).

FIGURE-13 TECHNOLOGY ACCEPTANCE MODEL

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Dillon and Morris IEEE Software, 14(4), 61

http://www.ischool.utexas.edu/~adillon/Journals/IEEE

%20papers_files/User%20Preceptions.htm

Across many theories and tests the term Perceived Usefulness introduced

in TAM has increased its popularity towards analysing exact factors as

well.

Although Hastie and Park believe that the information strategies used by

different consumers can be of two types. Either a Stimulus based or a

memory based processing (Hastie and Park, 1986). In a Stimulus based

processing all the information are observable and the customer can

compare all relevant alternatives across all Attributes (Mantel and Kardes,

1999).

A paper published in the Journal of Electronic Commerce Research in

November 2002 by Pavlou and Chai argues that the adoption of E-

Commerce primarily depends upon the consumer behavioural intentions to

engage in product purchase. The perceived Behavioural control and Trust

as proposed in TPB have a very critical role to play in this case. (Pavlou;

2002/03). The extra factors added in TPB from TRA gives a better picture

since the issues include more external factors than before. (Madden et al.,

1992)

2.6 Unified Theory of Acceptance and Use of Technology:

This theory stands on mainly four functions which are considered as direct

determinants for the usage of behaviour viz.

e) performance expectancy

f) effort expectancy

g) social influence

h) Facilitating conditions.

The following points are these which mediate the impact of these four key

which construct on differentiation and behaviour such as follows:

Gender, age, usage ,voluntaries of usage.

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This theory was developed very smartly. It contained a thorough review

and consolidation of the works done earlier by the Researchers. There

were about eight models available related to this field (Linking

Information Systems and the Behaviour). The eight main theories

proposed earlier are Theory of Reasoned Action, Theory of Planned

Behaviour, Technology Acceptance Model, and Motivational model, A

Combined Theory of Planned Behaviour/Technology Acceptance Model,

Model of PC Utilization, Innovation Diffusion Theory, and Social Cognitive

Theory. Subsequent validation of UTAUT in a longitudinal study found it to

account for 70% of the variance in usage intention (Venkatesh et. al.,

2003).

FIGURE-14 UNIFIED THEORY OF ACCEPTANCE AND USE OF TECHNOLOGY

Eija K, 2005; User Acceptance of Mobile Services- Value, Ease of Use,Trust and Ease of Adoption, Tampere University of Technologypp. 67.

http://www.vtt.fi/inf/pdf/publications/2005/P566.pdf

2.7 The Conceptual Model:

The theory of planned behaviour (TPB) asserted that there are some

specific beliefs which influence behavioural perceptions and subsequent

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actual behaviour (Ajzen, 1985, 1988, 1991). The three basic beliefs that

affect three perceptual constructs are

1. Behavioural Beliefs that affect Attitudes.

2. Normative Beliefs that affect Subjective Norm.

3. Control Beliefs that affect Perceived behavioural control.

And, these three constructs determine behavioural intentions and actual

behaviour. In this research we will first carefully understand the

perceptual approaches and terms to get a platform to decide upon the

methodology.

As per Pavlou and Chai attitude towards a behaviour can be defined as the

overall evaluation of the desirability of the potential transaction with a

specific web retailer. In 1995 Taylor and Todd (1995) describe the

construct as the generalized attitudinal belief that behaviour will lead to a

particular outcome.

This is basically the intention of a consumer to engage him in an

electronic transaction with an e-vendor/retailer (Zwass, 1998). Electronic

transaction here means sharing business information, maintaining

business relations or conducting business transactions and hence online

transaction can be viewed as interactive marketing communications

(Pavlou and Stewart, 2000).

An accepted theory is, consumers do not widely accepted e-commerce,

primarily because of the trust related issues. It was confirmed by differentstudies conducted at Hoffman et al (1999); Palmer, Baley and Faraj

(2000); Pavlou, (2000, 2003). Since trust is fundamental in predicting e-

commerce adoption (Gefen D, 2000) developing consumer rust is critical

for the continued growth of e-commerce (Palmer et al (2000); Stewart,

Pavlou and Ward (2002). It is not only the trust but also, the concerns

about privacy and security underscores the importance of trust (Chellapa

and Pavlou, (2002). Even in Asia it is arguable that the importance of

trust has become elevated in e-commerce given the high degree of

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uncertainty present in most online transactions (Fung and Lee, 1999;

Lee, 1998). Trust in a Web Vendor/Retailer may be defined as a

subjective probability by which consumers expects that a web retailer will

perform a given transaction in accordance with their confident

expectations (Ba and Pavlou, 2002). So, trust as a factor can be

controlled by the e-retailers by their trustworthiness.

Hofstedes (1980) cultural dimensions serve as the most influential culture

theory among social science research (Nokata and Sivakumar, 2001) The

study conducted by Hofstede has got a greater relevance and the

framework was generated among most extensive study ever undertaken

with about 116,000 respondents across 40 countries. And the results were

similar to 38 other studies (Nokata and Sivakumar, 2001).

FIGURE-15 THE CONCEPTUAL MODEL OF PAVLOU AND CHAI

TRUST

ATTITUDE

SOCIAL NOR M

SOCIAL

INFLUENCE

Perceived

Behavioral

Control

TRANSACTION

INTENTIONS

Long Vs. Short term

Orientation

High Vs. Low Power

Distance

CollectivismVs.

Individualism

Subjective Norm

Cultural Effects

Adopted from Pavlou & Chai; 2002; What drives e-commerce across culturespage 243,Journal of Electronic Commerce Research, Vol.3, No.4

This is the model suggested by Pavlou and Chai to understand the factorsaffecting Transaction Intensions of a consumer. This model is

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implemented in this research as well. The reason behind implementing

this specific model is due to its inclusion of the cultural dependency as a

factor to decide upon the actual behaviour.

2.8 The Culture Code:

Another very interesting study was done by the renowned Cultural

Anthropologist and marketing expert Dr. Clotaire Rapaille. As he says in

his bookthe Culture Code is the unconscious meaning we apply to any

given thing. The American experience with Jeeps is very different from the

French and German experience because our cultures evolved differently

(we have strong cultural memories of the open frontier; the French and

Germans have strong cultural memories of occupation and war).

Therefore, the Codes the meanings we give to the Jeep at an

unconscious level are different as well. (Rapaille C, 2006; pp.5)

Look at the Jews after the Diaspora; the Chinese, Indians and Brits. Their

success is based on some basic code elements that they share: tight

family structures, a belief in education, and a flexible but powerful

network. (Pesala S, 1

st

February, 2007; The Man Behind The CultureCode; http://solomonp.blogspot.com/2007/02/man-behind-culture-

code.html )

He claims that the culture code for Americans for shopping is

Reconnecting with Life. He also claims that shopping means more than

just buying things that are needed. It also means the Social Experience.

Its a way to go out and experience new things such as new fashion,

trends and products see them and feel them not relying just on television

promos. As per Rapaille this culture code is tapped into the adolescent

component of everyones life. An interesting aspect to look upon the

research problem would be to consider this factor as well. As the

implementation of the Conceptual Model adopted from Pavlou and Chai

also includes the Cultural effects on buying behaviour, cross checking the

results of the cultural affects by this method would make the results more

justified. Although Rapaille did found out the codes for shopping related to

Americans, still no such work has been done with Indian Subcontinent

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Peoples. An interview was conducted with few subjects of this type which

had thrown some light on this context.

The justification behind implementing this approach is because; the

intention of buying online may be affected by culture. The Conceptual

Model gives a very rough idea on this matter since, the questions in the

questionnaire answering this are well thought and as Rapaille said in his

book The Culture Code that questionnaire surveys are of very less

relevance when the real answers are expected. As the subject answers

mostly, what the interviewee wants to hear. The answers which are

prompt are believed to be delivered from the unconscious mind which

might be considered as of greater relevance. He further gives some

scientific explanation for this. He says, When asked direct questions

about their interests and preferences, people tend to give answers they

believe the questionnaire wants to hear. It is because people respond to

these questions with their Cortexes, the part of brain that controls

intelligence rather than emotion or instinct (Rapaille C, 2006; pp. 14)

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3. Research Methodology:

This part of the research is divided into four parts.

3.1 Justification of the Proposed Model Adopted (each of its

factors)

3.2 Justification of the second Model Adopted (need of cross-

checking)

3.3 How the adopted models will answer the research question

(Analysing the questions in the Questionnaire and Interview)

3.4 Establishing the relation between the Research Aims and

Objectives and the Research Method Adopted.

The first section (3.1) will deal with the question why it was necessary to

include this attribute in this model used in this research? The second

section (3.2) will deal with the question why is it necessary to cross-

check and what benefit would the second model bring to this research?

The third section (3.3) will deal with the question what importance does

this question hold in the Questionnaire or in the Interview? The fourthsection (3.4) will establish a relationship between the Research Aims and

Methodology Adopted.

3.1 Justification of the Proposed Model Adopted

The research methodology used in this paper is based on the Conceptual

Model proposed by Pavlou and Chai. It explains the interrelationship

between the factors affecting the Transaction Intensions of the Indian

Subcontinent Students about Online Shopping. An approach towards

knowing how the changed psychology (if at all), of the subjects will affect

their family when they will go back to their countries is also a question

that is to be answered by implementing this model. The Model as

discussed earlier has the inclusion of the culture theory (Known as

Hofstedes Theory). Out of the five paradigms explained by Hofstede, only

three were included by Pavlou and Chai. The Long Term vs. Short TermOrientation, Power Distance and Collectivism vs. Individualism were

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included. The Dependent Variable is the Transaction Intentions is

representing the Consumers e-Commerce Adoption Intentions. The

Attitude towards Transaction, Subjective Norm and the Perceived

Behavioural Control directly influence intentions of a customer to shop

online. (Pavlou; 2002).

The Model adopted from Pavlou is shown in the figure below,

Figure-16 The Adopted Model

TRUST

Social

Influence

Societal Norm

Attitude

Influence on

Family

Members

Collectivist vs.

Individualist

Transaction

Intentions

Subjective Norm s

Perceived

Control

PerceivedDifficulty

Perceived

Behavioural

Control

HI

H2H3H4

H5

H6

Author Generated

3.1.1 Attitude

The acceptance of Attitude, influencing Behavioural Intentions has been

very popular and supported by many theories such as Theory of Reasoned

Action (Ajzen and Fishbein, 1975) and Theory of Planned Behaviour (Ajzen

1991). In this case of research Attitude covers the evaluation of the whole

Transaction Attributes with a Web Vendor/Retailer. So it would be quite

simple to understand that a Positive Attitude towards this whole thing will

facilitate Online Transaction whereas the Negative Attitude will create a

barrier towards it. (Tractinsky and Jarvenpaa 1999)

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In the suggested model it is shown that Attitude is affected by Trust and

Collectivism vs. Individualism as one of the traits of Hofstedes Culture

Theory.

FIGURE-17 FACTORS AFFECTING ATTITUDE

TRUST

ATTITUDE

COLLECTIVISM vs.

INDIVIDUALISM

TRANSACTION

INTENTIONS

AUTHOR GENERATED

3.1.1.1 Trust Attitude

David Gefen in his research paper has considered Trust as a leading and

potential factor towards the acceptance of new IT procedures. It has

grown a challenge to the online retailers to make their customer

trustworthy in order to retain them. Many researches have considered it

as a single dimensional constructs. But in his paper Geffen has rather

viewed it as a multidimensional construct. He has included some specific

beliefs that directly or indirectly (by the overall assessment of trust)

influences Behavioural Intentions. (Geffen D, August 2002. pp. 38-53). In

this paper the Behavioural Intentions lies pretty close to the Transaction

Intentions. Because the ultimate behavioural outcome expected here is

transaction.

Other than Gefen, Chellapa and Pavlou in 2002 stated that the question of

trustworthiness overweighs the question of security. In their paper they

quoted Fung and Lee as trust has always been of high importance in

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influencing the attitude towards the consumer behaviour and holds high

relevance in Internet based e-Commerce environments. (Fung and Lee,

1999) In their paper, after studying 179 consumers they suggested a

strong relationship between consumers Perceived Information Security

and Trust in e-Commerce transactions. (Chellappa and Pavlou, 2002; pp.

358-368)

Also, Hoffman stated that the perceived ability to control their personal

information on the web is lacking in the consumers in most of the times.

And this lack of trust on their web retailers is one of the strongest barriers

to transact online.

H1: Higher the trust, more positive would be the attitude towards

online transactions.

Since this barrier is affecting the attitude of the consumer towards

transacting online. (Hoffman et al; April, 1999, pp. 80-85)

So, the inclusion of trust in the Conceptual Model was very important. In

the questionnaire there were two questions answering the real trust based

scenario in this case.

3.1.1.2 Collectivism vs. Individualism Attitude

As per the theory presented by Hofstede Collectivism and Individualism

are the traits of the society. Some Societies tend to stick together for

example, a Joint Family. Whereas some Societies tend to live

independently e.g. Nuclear Family. These qualities have a very strong

effect on Attitude. Pavlou and Chai stated A cultural dimension is relevant

to attitude toward transactions with Web retailers (Pavlou and Chai, pp.

243)

In a paper submitted by Bond and Smith analysing Cross-Cultural

Psychology infers that in a highly collective society a trait picked up bysomeone would be followed by the others in the society. Whereas, in an

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Individualistic Society the opinions differ to every individual. In a

Collective Society everyone is closely bonded to each other. Hence, it can

be well predicted that the people like to do everything in their respective

groups in this society. In this paper the question of Shopping Online is

being masked by this reason also (one of the reasons). People in Indian

Subcontinent are highly collectivist (IDV Score of 48 as per Hofstede),

(Hofstede, 1994 pp. 53) and hence like to do shopping with friends and

family than doing it online (as the results suggests from the

questionnaire).

So, a Hypothesis can be drawn that,

H2: The more the people are collectivist, more they will have a

positive attitude towards following others in the group and

indulge themselves in the same activity.

Shopping is also an activity and hence they will try more to do it in groups

rather than doing it online. In this way the Collectivism affects the attitude

which in turn affects the Transaction intentions.

3.1.2 Societal Norm and Social Influence

The Subjective Norm used in the Theory of Panned Behaviour has been

divided into two categories. One is Social Norm and the other is Social

Influence. A very interesting approach towards looking at Social Norm

would be by further dividing it into Injunctive Norm and Descriptive Norm.

This new definition published in The Higher Education Center for Alcohol

and Drug Prevention, U.S Department of Education has added a new way

to look at it. The Injunctive Norm refers to the attitude is based on Morals

or Belief. Descriptive Norm refers to the behaviour. That is, what people

actually do? (Berkowitz D A, 12th August, 2004; The Social Norms

Approach: Theory, Research and Annotated Bibliography,

http://www.higheredcenter.org/socialnorms/theory/types.html)

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FIGURE-18 FACTORS AFFECTING SUBJECTIVE NORM

TRANSACTION

INTENTIONS

COLLECTIVISM vs.

INDIVIDUALISM

SUBJECTIVE

NORM

SOCIAL

INFLUENCE

SOCIETAL

NORM

Author Generated

3.1.2.1 Collectivism Subjective Norm

As defined earlier, collectivism is the kind of society that tends to stick

together with strong beliefs. According to Hoffman et al, 2005 the

collectivist countries were more acceptant towards socially reticent andwithdrawn behaviours than was the case in individualistic countries.

(Hoffman et al; 2005) So, in other words being a collectivist society

Students from Indian Subcontinent have definitely been affected by not

joining the flow of revolutionary e-commerce which in turn has affected

their Transaction Intentions Online. It also says that, Social anxiety may

be higher in countries where the social norms are clear and extensive,

than in the countries where the social norms are a bit relaxed (Hoffman

et al; 2005). It can be contingent here that a adopting a new system

always increase Social Anxiety which is basically due to the

interdependence of Subjective Norms and Transaction Intentions.

Pavlou and Chai have differentiated the Subjective Norm as Societal Norm

and Social Influence. Societal Norm here in this case means the outlook of

the larger circle. That is, the whole community, for example, Middle class

people in the subcontinent. The Social Influence is the influence of the

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opinion of the closed ones for example, Family and Friends. Moreover, in a

collectivist society, keeping harmony within the group is the highest

priority and hence, social norms have a serious impact on behaviour. It is

generally observed that in a collectivist society the rules are very strict in

order to maintain guidelines to avoid social-slips. As a result trying new

things is very rare. (Hein Richs et al; 2006)

The inclusion of this factor in the conceptual model used in this paper is

influenced by the high interdependence of Subjective Norm, Collectivist

Culture and Transaction Intentions.

Hence, it can be said that,

H3: Collectivism is correlated to the Societal Norm and seems to

share a directly proportional interrelation.

3.1.3 Perceived Behavioural Control

Perceived Behavioural Control (PBC) may be defined as ones ability to

perform a given task. The concept of including PBC in the TPB (Theory of

Planned Behaviour) was to amalgamate the Perceived Difficulty and

Perceived Control in order to understand the affects of PBC on Transaction

Intentions. However, there is enough proof of PBC influencing the

Intentions. (Mathieson K, September 1991; pp.178 and Ajzen 1994)

3.1.3.2 Trust PBC

Pavlou argued that Trust is probably one of the most vital issues when it

comes to online transaction in B2C commerce. Trust provides the

consumer with the Perceived Behavioural Belief (Control) to incorporate

the total perceived control over their web retailer/vendor. Trust can never

affect Transaction intentions directly. Because it will either affect the

attitude of the customer in a positive/negative way or can affect the PBC.

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FIGURE- 19 FACTORS AFFETING PBC

TRUST

Perceived

Control

Perceived

Difficulty

Transaction

Intention

Author Generated

In the first case the customer not having Trust on his web vendor will

change his attitude towards e-shopping. Whereas, in the second case if a

customer have a minimal level of Trust on his web vendor will generate a

minimal level of Perceived Control over the whole process. He will

perceive that he knows his web vendor well (have seen people buying and

getting satisfied) and will have a control over the whole process, which is

generated by his PBC (because of being effected by Trust). (Proctor W R,

Phuong K and Vu L, 2005; Handbook of Human Factors in Web Design,

pp. 582)

So, it can be said that,

H4: More the Trust, More positive would be the Perceived Control.

3.1.4 Influence on Family Members:

One of the questions I the questionnaire was dealing with one of the

research objective to know the Influence on Family Members by the

Subjects. In some communities or societies people accepts or inherits

Trust from word of mouth communications as well. The inheritance of

Trust from word of mouth is not new and has been accepted by many

researchers. And some strong determinants of Trust were identified by

word of mouth related to exchange of information obtained from family

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and friends are very high. (Kautonen and Welter; 2005, The Conceptual

Model of Trust In the Online Environment(2005), Trust, social networksand enterprise development: exploring evidence from East and West

Germany, International Entrepreneurship & Management Journal, Vol. 1

No. 3, pp. 367-79.OIR31,5620 )

It might be said that Trust can generate some positive effects on the

subjects which in turn can influence their family members about online

transaction intentions and hence it can be said that,

H5: More the Trust, More would be the initiative to Influence

Family members.

Table-20 Trust and Influence on family members

TRUSTTransactionIntention

Influence on

FamilyMembers

Author Generated

3.1.5 Social Influence and Attitude:

As a matter of fact the research using these two variables is not new.

Lucas (1978); suggested the support of managers have a social-critical

influence on workers attitude. Klobass PBiC model suggested the

extensional use of the Network Information as mathematical functions of

intentions (Klobas 1997). And then comes Ajzen (1985) who proposed the

linkage between Attitude and Social Norm by saying Intentions are formed

from Attitudes to outcomes of use. The most important part that the

Social Influence plays is accessing affects of it towards the different

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Attitudes of the First Time Users and Late Adopters. Klobas studied the

nature of few people and concluded Social Influences were frequently

combined with Positive Attitudes. They also observed that Social

Influence affects the Intended Use (Transaction Intentions here) by

influencing users perceptions of the Internet and Attitudes to the

outcomes of use. (Klobas J and Clyde L, November 2001; Social

Influence and Internet use, Library Management, 22(1/2), pp. 66)

Figure-21 Attitude and Social Influence

Attitude

Social Influence

Societal Norm

Transaction

Intentions

Author GeneratedHence it can be said that,

H6: Higher the Social Influence, stronger would be the Attitude to

Transact Online.

3.2 Justification of the second Model Adopted

In the above section, the justification for adopting the Conceptual Modeladopted has been discussed in length. In simple words, the above model

will form the platform for judging the interrelationship between the factors

affecting the Transaction Intention of a consumer for buying online. The

Indian Subcontinent Scenario is such that most of the students coming to

UK have started realising the importance of e-shopping. The affect of a

strong cultural factors were being combined with the psychological factors

revealing the truth behind the slow progression of e-commerce could be

answered with such a tool. Moreover the second research question of

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what would happen when they will go back to their country could also be

addressed to some extent with the help of the model. But, an interesting

idea could be to cross check the results obtained from the above model.

The primary research of data gathering was done by circulating

questionnaires both manually and online. Still one question would remain

unaddressed if the culture is also responsible for this even to a little

extent then, why?

Here comes the role of understanding the culture code. A Culture Code as

described by Rapaille is the unconscious meaning anyone applies to

anything. Understanding the Consumer Behaviour with the help of

Cognitive Theories of Psychology were the early steps for marketing.

There are many proofs of Psychologists conducting sessions with focus

groups and doing surveys. As Bagozzi says, . are on the side of

inclusion by introducing research from cognitive psychology and emotional

psychology as they inform or directly interface with contemporary social

psychology in consumer behaviour (Bagozzi P R, 2000; pp. 2) Previous

related works done by Artino Jr. A and Stephens M J, 2002, for predicting

Attitude towards Online Learning gives a great deal of insight on this

subject.

The interview format adopted in this research was divided into two

groups. This can also be termed as Attitude Survey. Although, while

following the Pavlou and Chais Model, questionnaire were based on closed

ended questions. Since, the results of social surveys today are mainly

based on closed ended questions it has become convenient to analyse the

final results in tabular or graphical form. (Schuman H and Presser S;

1996) This part of the research is a combination of both open and closed

ended questions. The Fist section started with open ended questions to

set a mental frame for the subjects about online shopping. Questions such

as How do you like to shop? or How do you feel shopping online? will

help the subjects to set a mental frame about online shopping. The

answers they were giving in this section were completely coming from

their intelligence. That is, the Cortex. Now comes the second part. Afterthe mental frame being set, in the second section they were asked to say

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two words against one word said. But, the trick was they had to say the

two words as soon as the first word was said. For example, if the word

was wallet the answers were Money and Rupees in most of the cases.

Very less people said Debit Cards. This shows the imprint of objects they

associate with Wallet. The argument is if someone says Money and

Rupees and not Electronic Cards this shows the attitude of buying

things with CASH only. Even if he has cards he prefers to use cash and

which is very rare in online transactions.

3.3 Analysing the questions in the Questionnaire and Interview

The whole research is divided into two very important parts. Looking at

the overview, the two parts are called as

3.3.1 The Primary Research

3.3.2 The Secondary Research

3.3.1 Primary Research

It is the manual research done to answer the research questions. This

includes Designing the Questionnaire, Distributing it (to Target Surveyors)

and finally gathering al together to form a meaningful picture in order to

answer the research Aims and Objectives. This part of the research will

discuss the types of question that has been asked in the questionnaire

and the behavioural attributes associated to it.

3.3.1.1 The Questionnaire

Q1. Do you use Internet very often?

Behavioural Attribute: Exposure towards Internet

a) Yes ------------------------------ Positive Exposure.

b) No ------------------------------- Negative Exposure.

c) Sometimes ---------------------- Neutral Exposure.

d) Every time ---------------------- Strong Positive Exposure.e) Others --------------------------- Case Sensitive.

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Q2. How long you have been using Internet?

Behavioural Attribute: Experience of using Internet

a) 1-2 years --------------------------- Nominal Experience.

b) 2-3 years --------------------------- Some Experience.

c) More than 5 years ------------------ Good Experience.

d) More than 10 years ---------------- Very Good Experience.

Q3. Where do you access Internet from?

Behavioural Attribute: Access Type

a) Cyber Caf --------------------------- Highly Paid Access.

b) Institution ---------------------------- Very Easy Access.

c) Office --------------------------------- Easy Access.

d) Home --------------------------------- Paid Access.

Q4. What are the activities you use Internet for?

Behavioural Attribute: Perceived Usefulness

a) Communication (e-mail, IM, Chat) ------------------ PU is lowest.

b) Information Gathering (Research, Job Search) ----- PU is low.

c) Entertainment (Games, Adult Entertainment) ------- PU is low.

d) Finance (Investments, Online Banking) -------------- PU is high.

e) Shopping (Auctions, Grocery, Electronic goods) ----- PU is high.

Any two PU is Very High, Any three PU is Highest.

Q5. Have you purchased anything online ever?

Behavioural Attribute: Buying Experience

a) Yes ------------------------------------------- Have the experience.

b) No -------------------------------------------- Dont have experience.

c) Thought of but, didnt ----------------------- Wants to have experience.

Q6. If Yes, then how many times?

Behavioural Attribute: Trust.

a) Once --------------------------------------- Have some Trust.

b) More than once --------------------------- Have strong Trust.c) Couple of Times --------------------------- Have strongest Trust.

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Q7. What, according to you are most important barriers to purchase

online?

Behavioural Attribute: Perceived Difficulty

a) Worried about credit card number ---------- Have strongest PD.

b) I enjoy going out to do my shopping ------- Have more PD.

c) I like to feel, see, touch the product -------- Have very high PD.

d) Dont like giving personal information ------ Have very high PD.

e) Dont have a credit card --------------------- Have strong PD.

f) Internet is too slow --------------------------- Have some PD.

g) Cost of after sales service -------------------- Have high PD.

h) Delivery Costs are too high ------------------- Have highest PD.

i) Technical foul-ups ----------------------------- Have low PD.

j) I am uncomfortable ---------------------------- Have some PD.

k) Other ------------------------------------------- Case Sensitive.

Q8. Would you like to consider buying online provided you get a help

with?

Behavioural Attribute: Perceived Control

a) Transaction guarantee by reliable source ---- Have weak PC.

b) Explained the advantages of online buying - Have high PC.

c) Pay when you get the delivery ---------------- Have no PC.

d) Good after sales service -------------------- Have some PC.

e) Get value added services ------------------- Have good PC.

Q9. If you know someone who bought something online, how do you feel?

Behavioural Attribute: Social Influence

a) Quite Normal ---------------------------------- Some SI.

b) WOW!!!!! -------------------------------------- High SI.

c) Doesnt Matter --------------------------------- Least SI.

d) Lets give it a try ------------------------------- Highest SI.

Q10. How do you feel talking to someone about buying things online?

Behavioural Attribute: Attitudea) Comfortable -------------------------------------- Positive Attitude.

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b) Uncomfortable ------------------------------------ Negative Attitude.

c) Should share the benefits with others -----------Strong Positive

Attitude.

Q11. Did the behaviour about buying online changed as I moved to UK

from my country?

Behavioural Attribute: Societal Norm

a) I never did e-shopping but now I do ------------ Highest SN.

b) All the same --------------------------------------- Neutral SN.

c) Getting interested --------------------------------- Positive SN.

d) Getting highly interested ------------------------- High SI.

Q12. How do you like to shop most?

Behavioural Attribute: Collectivism vs. Individualism

a) With Friends ------------------------------------- Very Collectivist.

b) With Family -------------------------------------- Very Collectivist.

c) Go out and visit many stores and then decideNeutral.

d) Shopping with great food and fun -------------- Collectivist.

e) Shop online --------------------------------------- Individualistic.

Q13. After yo

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