PROJECT REPORTON

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 YadavAss. Professor 04224501710

JAGANNATH INTERNATIONAL MANAGEMENT SCHOOL. KALKAJI

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Student’s Undertaking

I hereby certify that this is my original work and it has never been submitted

elsewhere

by:

Vishal Yadav

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CONTENTS

Description Page no.

Acknowledgement 4

Executive Summary 5

Certificate of completion 6

Introduction to topic 7

Objectives 11

Literature review 12

Research Methodology 43

Analysis &Interpretation 44

Findings & Techniques 56

Recommendations & conclusions 77

Bibliography 78

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AKNOWLEDGMENT

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

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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 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, socialmedia marketing strategy, social media marketing in Indi

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CERTIFICATE OF COMPLETION

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)

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INTRODUCTION

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 isprobably 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

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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 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 contentpublishers. 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 arecollectively referred social media.

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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: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.

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OBJECTIVES

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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LITERATURE

REVIEW

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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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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

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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;

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

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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.

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.

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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.

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,

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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.

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]

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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]

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

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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.

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.comwww.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

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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) 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

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www.bata.in

Jewellery only www.jewelsnext.com

www.juvalia.in www.gitanjaligifts.com www.bluestone.com www.tanishq.co.in

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

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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

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

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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]

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

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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.

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

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consumers would demonstrate a trend toward applying more scrutiny to nutrition claims

and would demand more specific information about the foods they purchase.

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

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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 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

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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

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

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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.

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]

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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]

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

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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

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

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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

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

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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

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

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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

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.

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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

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.

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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.

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

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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

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.

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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.

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

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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

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

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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

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’ .

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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 .

Tools and techniques of E-Marketing

Search engine marketing

Email marketing

Banner ads

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Extranets

Metrics and analysis

Event registration

Asset sharing

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.

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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.

• 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

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indigenization of the web for the real Indians and the correct application of the

mentioned internet marketing techniques is truly the way forward.

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

Analysis &

Interpretation

44

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

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.

46

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.

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.

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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.

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.

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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.

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

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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.

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.

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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 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.

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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.

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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.

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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

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

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

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

Figure 1

below 20

20-24

25-34

35-39

40 and above

Age

57

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

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.

Male

Female

Gender

Pies show counts

58

CITY

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.

Agra

Ahmedabad

Bangalore

ChennaiChandigarh

Delhi

Faridabad

Gurgaon

Hyderabad

Jaipur

Kolkata

LucknowMumbai

Noida

Pune

Others

City

0.80%

3.20%

26.20%

2.40%

3.20%

20.00%

0.80%

0.80%

4.80%2.40%

0.80%

0.80%

18.00%

1.80%2.80%

11.20%

59

EDUCATION

Figure 4

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.

Under Graduate Graduate Post Graduate

Education

25

50

75

100

125

Co

un

t

60

OCCUPATION

Education

Advertising

Research and analysis

Manager

BankingBusiness

Consultancy

Doctor

Engineer

Homem

aker

HR Insurance

IT JournalismLaw

yer

Marketing

MediaReal Estate

Student

others

Occupation

0

10

20

30

40

Per

cen

t

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

FINDINGS AND

TECHNIQUES

62

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 that

supports electronic marketing currently accounts for just 8 percent of the United States’

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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

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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

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

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 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

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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

existing vendors so as to maximize profits. This increases transaction costs for the

consumer, decreasing intention to revisit a specific online store.

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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

products without touching or feeling them if they can save time in this way. Potential

consumers are often prevented from shopping online by their concern for security (Han

et al. 2001). However, perceived risk can be reduced by knowledge, skill, and

experience on the Internet, computer, and online shopping (Ratchford et al. 2001;

Senecal 2000; Sukpanich and Chen 1999; Ha et al. 2001). In another study, Bellman

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and colleagues (1999) propose that people living a wired lifestyle patronize e-stores

spontaneously. These consumers use the Internet as a routine tool to receive and send

emails, to do their work, to read news, to search information, or for recreational

purposes. Their routine use of the Internet for other purposes leads them to naturally

use it as a shopping channel as well. Other factors found to impact consumers. online

shopping attitudes and behavior include cultural environment, need specificity, product

involvement, disposition to trust, the extent to which they would like to share values and

information with others, the extent to which they like being first to use new technologies,

and tendency to spend money on shopping (Borchers 2001; Koufaris et al.2002; Lee et

al.2000; Kimery and McCord 2002; Bellman et al 1999).

Vender/Service/Product Characteristics

Sixteen out of the 35 studies examine the relationship between vender/service/product

characteristics and other factors. Vender/service/product characteristics refer to

features of the Internet stores, the products they sell, and the service they provide to

support the transactions. These factors are found to influence customers. online

shopping attitudes and behavior significantly. Measures employed to value vender

characteristics in the empirical studies include (1) real existence of the store/physical

location, (2) store reputation, (3) store size, (4) reliability, (5) number of Internet

store .entrances., (6) assurance-building mechanisms (e.g., seals, warranties, news

clips), and (7) use of testimonials (van der Heijden et al. 2001; Liang and Lai 2000;

Bhatnagar et al. 2000; Kim et al. 2001; Lowengart and Tractinskky 2001; Grazioli and

Wang 2001; Pavlou 2001; Jarvenpaa et al. 2000; Lee et al. 2000). Among product

features that impact customers. online shopping behavior are (1) variety of goods, (2)

product quality/performance/product uncertainty, (3) product availability, (4) price, (5)

social presence requirement, (6) product presence requirement, (7) dependability of

product, (8) possibility of customized products, and (9) brand (Jahng et al. 2001; Liang

and Huang 1998; Kim et al. 2001; Cho et al. 2001; Lowengart and Tractinskky 2001;

Muthitacharoen 1999). In addition, researchers examine different aspects of service

provided by the venders through the online shopping process. Service factors related to

online shopping attitudes and behavior include

70

(1) customer communication channels/ease of vendor contact,

(2) response to customer needs,

(3) accessibility of sales people,

(4) reliability of the purchasing process/process uncertainty,

(5) timeliness of orders or services/waiting time,

(6) availability of personalized services,

(7) ease of return and refunds,

(8) fraud,

(9) delivery (speed, tracking and tracing),

(10) transaction costs,

(11) peripheral costs, and

(12) promotion (Ho and Wu 1999;

Website Quality

Twenty studies investigate the relationship between website quality and consumers

online shopping attitudes and behavior from different points of view. For example,

Gefen and Straub (2000) investigate the impact of perceived ease of use (PEOU) and

perceived usefulness (PU) on e-commerce adoption using 202 MBA students as

subjects. They report that while PU affects intended use when a Web site is used for a

purchasing task, PEOU only has an indirect influence on online shopping behavior by

directly influencing PU. Lee et al. (2001) obtain the similar findings in their recent study

of design factors affecting consumer loyalty. In one study, Song and Zahedi (2001)

classify website quality elements into five categories according to their purpose: for

promotion, service, informational influence, self-efficacy, and resources facilitation.

These investigators find that each of the five significantly and positively reinforces the

consumers. perceptions in these factors, which in turn positively influence consumer

71

online shopping attitudes and behavior. Zhang, von Dran, Small, and Barcellos (1999,

2000), and Zhang and von Dran (2000) make an attempt to evaluate website quality

from user satisfaction and dissatisfaction perspective. Their studies show that website

design features can be regarded as hygiene and motivator factors that contribute to

user dissatisfaction and satisfaction with a website. Hygiene factors are those whose

present make a website functional and serviceable, and whose absence causes user

dissatisfaction. Some of the categories of hygiene factors are: Privacy and Security,

Technical Aspect, Navigation, Impartiality, and Information Content. Motivator factors

are those that add value to the website by contributing to user satisfaction. Five

categories of motivation factors are: Enjoyment, Cognitive Outcome, User

Empowerment, Credibility, Visual Appearance, and Organization of Information Content.

In their continued effort, they further discover that the most important website quality

factors ranked by e-commerce consumers are hygiene factors (von Dran and Zhang

1999; Zhang et al. 2000; Zhang and von Dran 2001a, 2001b; Zhang et al. 2001). Liang

and Lai (2000) review website quality factors influencing Internet buying behavior by

categorizing them into three groups, two of them are also named motivators and

hygiene factors, and third media richness factors. In their opinion, motivators are those

who support the transaction process directly while hygiene factors protect the

consumers from risks or unexpected events in the transaction process. Media richness

factors .add more information channels or richness in information presentation. (Liang

and Lai 2000, p. 2). They suggest that providing good transaction support will help

Internet venders to beat their electronic competitors, while the hygiene factors need to

be paid attention if they want to attract consumers from traditional stores.

Overall, the measures employed to value website quality by the researchers include the

websites. information content, information presentation, interaction between customers

and venders, navigation, searching mechanism, security, site technical feature, media

richness, and so forth

In summary, a variety of factors related to website quality have been demonstrated to

significantly influence consumers. Online shopping attitudes and behavior.

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Attitudes Towards Online Shopping

Consumers. attitudes toward online shopping have gained a great deal of attention in

the empirical literature, with 22 out of 35 papers focusing on it. Consistent with the

literature and models of attitude change and behavior (e.g., Fishbein and Ajzen 1975), it

is believed that consumer attitudes will affect intention to shop online and eventually

whether a transaction is made. This is a multidimensional construct that has been

conceptualized in several different ways in the existing literature. First, it refers to the

consumers. acceptance of the Internet as a shopping channel (Jahng et al. 2001).

Secondly, it refers to consumer attitudes toward

a specific Internet store (i.e., to what extent consumers think that shopping at this store

is appealing). These first two dimensions are negatively associated with the third,

customers. perceived risk. According to Lee and colleagues (2001), two main

categories of perceived risk emerge in the process of online shopping. The first is the

perceived risk associated with product/service and includes functional loss, financial

loss, time loss, opportunity loss, and product risk. The second is the perceived risk

associated with context of online transactions, and includes risk of privacy, security, and

nonrepudiation. Among them, the influence of financial risk, product risk, and concern

for privacy and security is significant (Senecal 2000; Borchers 2001; Bhatnagar et al.

2002). However, the fourth dimension of attitude, consumers. trust in the stores, can

reduce perceived risk. In addition, perceived control/users. empowerment,

enjoyment/playfulness, and perceived real added-value from membership have also

been shown to be important dimensions of consumers. attitudes towards online

shopping

Intention to Shop Online

Consumers. intention to shop online is studied by 13 out of the 35 papers. Consumers.

intention to shop online refers to their willingness to make purchases in an Internet

store. Commonly, this factor is measured by consumers. willingness to buy and to

return for additional purchases. The latter also contributes to customer loyalty.

Jarvenpaa and colleagues (2000) assess consumers. intention to shop online by asking

73

a series of questions assessing the likelihood of returning to a store.s website, the

likelihood of purchasing from the store within the next three months, the likelihood of

purchasing within the next year, and general the likelihood of ever purchasing from a

particular store again.

Consumers. intention to shop online is positively associated with attitude towards

Internet buying, and influences their decision-making and purchasing behavior. In

addition, there is evidence of reciprocal influence between intention to shop online and

customer satisfaction.

Online Shopping Decision Making

Online shopping decision-making includes information seeking, comparison of

alternatives, and choice making. The results bearing on this factor directly influence

consumers. purchasing behavior. In addition, there appears to be an impact on users.

satisfaction. Though it is important, there are only five studies that include it. According

to Haubl and Trifts (2000), potential consumers appear to use a two-stage process in

reaching purchase decisions. Initially, consumers typically screen a large set of

products in order to identify a subset of promising alternatives that appears to meet their

needs. They then evaluate the subset in greater depth, performing relative comparisons

across products based on some desirable attributes and make a purchase decision.

Using a controlled experiment, these authors discover that the .interactive tools

designed to assist consumers in the initial screening of available alternatives and to

facilitate in-depth comparisons among selected alternatives in an online shopping

environment may have strong favorable effects on both the quality and the efficiency of

purchase decisions.

Online Purchasing

74

Fourteen studies discuss online purchasing, which refers to consumers. actions of

placing orders and paying. This is the most substantial step in online shopping activities,

with most empirical research using measures of frequency (or number) of purchases

and value of online purchases as measures of online purchasing; other less commonly

used measures are unplanned purchases of the relationship between online purchasing

behavior, perceived ease of use, perceived usefulness, perceived risk of the

product/service, and perceived risk in the context of the transaction, the measures used

are total amount spent and frequency in last 6 months.

Online purchasing is reported to be strongly associated with the factors of personal

characteristics, vendor/service/product characteristics, website quality, attitudes toward

online shopping, intention to shop online, and decision making

Consumer Satisfaction

Consumer satisfaction is the focus of the investigation in only three articles. It can be

defined as the extent to which consumers. Perceptions of the online shopping

experience confirm their expectations. Most consumers form expectations of the

product, vendor, service, and quality of the website that they patronize before engaging

in online shopping activities. These expectations influence their attitudes and intentions

to shop at a certain Internet store, and consequently their decision-making processes

and purchasing behavior. If expectations are met, customers achieve a high degree of

satisfaction, which influences their online shopping attitudes, intentions, decisions, and

purchasing activity positively. In contrast, dissatisfaction is negatively associated with

these four variables

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Advantages of Shopping Online

Saves Time

If you already know what you're looking for, shopping online can save you a significant amount of time. With just a few clicks of the mouse, you can place your order and move on to other things.

2. Price Comparisons

While shopping online, it is very easy to do price comparisons for a given item. Once you have determined what you want to purchase, you can see if you are getting the best deal with just a few clicks. And making it even easier, there are now search engines specifically designed for price comparisons, and these sites will often even calculate and include any shipping charges, so you get to compare the actual, total cost of the item.

3. Saves Fuel

Fuel prices have been up and down in recent years, but no matter how expensive or inexpensive gasoline might be at any given time, shopping online does not require any driving, so it doesn't consume any fuel, no matter what the cost.

Larger Inventory

With online retailers, it is much easier to find the item, model number, color, style, and size you want. You can also quickly determine whether the item is "in stock" or not. Also, online shopping does not restrict you geographically -- the pool of products and available inventory for you to choose from is vastly larger than those available to you via local retailers within driving distance.

Shop 24/7

Online stores are available twenty-four hours a day, seven days a week, all year long. The same claim cannot be made by most (if any) retail stores. Online shopping allows you to shop whenever you want, at your convenience.

No Waiting

When purchasing online, there are no long lines that you are forced to stand in line just to make a purchase. In fact, when you purchase online, your wait time will simply be the time required to display the website ordering page.

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Convenience

Online stores are usually available 24 hours a day, and many consumers have Internet access both at work and at home. Other establishments such as internet cafes and schools provide internet access as well. In contrast, visiting a conventional retail store requires travel and must take place during business hours.

In the event of a problem with the item (e.g., the product was not what the consumer ordered, the product was not satisfactory), consumers are concerned with the ease of returning an item in exchange for either the correct product or a refund. Consumers may need to contact the retailer, visit the post office and pay return shipping, and then wait for a replacement or refund. Some online companies have more generous return policies to compensate for the traditional advantage of physical stores. For example, the online shoe retailer Zappos.com includes labels for free return shipping, and does not charge a restocking fee, even for returns which are not the result of merchant error. (Note: In the United Kingdom, online shops are prohibited from charging a restocking fee if the consumer cancels their order in accordance with the Consumer Protection (Distance Selling) Act 2000).[22]

Information and reviews

Online stores must describe products for sale with text, photos, and multimedia files, whereas in a physical retail store, the actual product and the manufacturer's packaging will be available for direct inspection (which might involve a test drive, fitting, or other experimentation).

Some online stores provide or link to supplemental product information, such as instructions, safety procedures, demonstrations, or manufacturer specifications. Some provide background information, advice, or how-to guides designed to help consumers decide which product to buy.

Some stores even allow customers to comment or rate their items. There are also dedicated review sites that host user reviews for different products. Reviews and even some blogs give customers the option of shopping for cheaper purchases from all over the world without having to depend on local retailers.

In a conventional retail store, clerks are generally available to answer questions. Some online stores have real-time chat features, but most rely on e-mails or phone calls to handle customer questions.

Price and selection

77

One advantage of shopping online is being able to quickly seek out deals for items or services provided by many different vendors (though some local search engines do exist to help consumers locate products for sale in nearby stores). Search engines, online price comparison services and discovery shopping engines can be used to look up sellers of a particular product or service.

Shipping costs (if applicable) reduce the price advantage of online merchandise, though depending on the jurisdiction, a lack of sales tax may compensate for this.

Shipping a small number of items, especially from another country, is much more expensive than making the larger shipments bricks-and-mortar retailers order. Some retailers (especially those selling small, high-value items like electronics) offer free shipping on sufficiently large orders.

Another major advantage for retailers is the ability to rapidly switch suppliers and vendors without disrupting users' shopping experience.

Problems faced by customer on E – retail websites

Shipping Costs

Unless you purchase digital products, there will sometimes be an additional expense to

ship your purchases. The shipping cost will often depend on the size and the weight of

the item. Many online retailers offer "free" shipping, but only if the cost of your order

reaches a certain minimum amount. The additional shipping costs can make the overall

cost of purchasing online, especially for larger and heavier items, much less attractive

than buying locally.

2. Lack Of Instant Gratification

Unlike retail stores, purchasing online will require some patience after you place your

order, while you wait for your order to be packed, shipped, and delivered to you. Unless

you are purchasing digital goods that can be "downloaded" immediately, you will have

to wait a few days for your order to arrive. You simply can't walk out of the store with

your newly acquired item in-hand.

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3. See It, Touch It, Feel It

Some shoppers like being able to see and feel an item, and to test it or try it on prior to

purchasing. By actually seeing the item, and being able to physically feel and inspect

the item, the purchaser can often make a far more reasonable assessment of the

quality. This is difficult to do if you are just looking at an online photo of the item.

Personal Data

Some people are concerned about the potential security risks of storing and sharing of

their personal data and credit card numbers with online retailers. While this risk is also

an issue for local retail stores (and some security experts say an even greater risk),

many people feel that purchasing online is an added security risk that they are just not

willing to take.

No Relationship

When you purchase online, you rarely have the opportunity to build a relationship with

the seller. On the other hand, local retail stores are far more likely to form relationships

with their customers, simply because of the personal interaction between buyer and

seller.

Support

Online support may be limited, or even non-existent, for items purchased online.

Defective Items

When trying to deal with defective items purchased online, quite often the only option is

to pack the item up and ship it back to the online retailer for a credit or replacement.

And the customer is often responsible for any return shipping costs. After waiting a few

days for your item to arrive in the first place, this adds even more time to the overall

process.

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Fraud and security concerns

Given the lack of ability to inspect merchandise before purchase, consumers are at

higher risk of fraud than face-to-face transactions. Merchants also risk fraudulent

purchases using stolen credit cards or fraudulent repudiation of the online purchase.

However, merchants face less risk from physical theft by using a warehouse instead of

a retail storefront.

Secure Sockets Layer (SSL) encryption has generally solved the problem of credit card

numbers being intercepted in transit between the consumer and the merchant.

However, one must still trust the merchant (and employees) not to use the credit card

information subsequently for their own purchases, and not to pass the information to

others. Also, hackers might break into a merchant's web site and steal names,

addresses and credit card numbers, although the Payment Card Industry Data Security

Standard is intended to minimize the impact of such breaches. Identity theft is still a

concern for consumers. A number of high-profile break-ins in the 2000s has prompted

some U.S. states to require disclosure to consumers when this happens. Computer

security has thus become a major concern for merchants and e-commerce service

providers, who deploy countermeasures such as firewalls and anti-virus software to

protect their networks.

Phishing is another danger, where consumers are fooled into thinking they are dealing

with a reputable retailer, when they have actually been manipulated into feeding private

information to a system operated by a malicious party. Denial of service attacks are a

minor risk for merchants, as are server and network outages.

Quality seals can be placed on the Shop web page if it has undergone an independent

assessment and meets all requirements of the company issuing the seal. The purpose

of these seals is to increase the confidence of online shoppers. However, the existence

of many different seals, or seals unfamiliar to consumers, may foil this effort to a certain

extent. A number of resources offer advice on how consumers can protect themselves

when using online retailer services. These include:

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Sticking with known stores, or attempting to find independent consumer reviews

of their experiences; also ensuring that there is comprehensive contact

information on the website before using the service, and noting if the retailer has

enrolled in industry oversight programs such as a trust mark or a trust seal.

Before buying from a new company, evaluate the website by considering issues

such as: the professionalism and user-friendliness of the site; whether or not the

company lists a telephone number and/or street address along with e-contact

information; whether a fair and reasonable refund and return policy is clearly

stated; and whether there are hidden price inflators, such as excessive shipping

and handling charges.

Ensuring that the retailer has an acceptable privacy policy posted. For example

note if the retailer does not explicitly state that it will not share private information

with others without consent.

Ensuring that the vendor address is protected with SSL (see above) when

entering credit card information. If it does the address on the credit card

information entry screen will start with "HTTPS".

Using strong passwords, without personal information. Another option is a "pass

phrase," which might be something along the lines: "I shop 4 good a buy!!" These

are difficult to hack, and provides a variety of upper, lower, and special

characters and could be site specific and easy to remember.

Although the benefits of online shopping are considerable, when the process goes

poorly it can create a thorny situation. A few problems that shoppers potentially face

include identity theft, faulty products, and the accumulation of spyware. Whenever users

purchase a product, they are required to put in their credit card information and

billing/shipping address. If the website is not secure, customer information can be

accessible to anyone who knows how to obtain it. Most large online corporations are

inventing new ways to make fraud more difficult. However, criminals are constantly

responding to these developments with new ways to manipulate the system. Even

though online retailers are making efforts to protect consumer information, it is a

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constant fight to maintain the lead. It is advisable to be aware of the most current

technology and scams protect consumer identity and finances.

Product delivery is also a main concern of online shopping. Most companies offer

shipping insurance in case the product is lost or damaged. Some shipping companies

will offer refunds or compensation for the damage, but this is up to their discretion.

Lack of full cost disclosure

The lack of full cost disclosure may also be problematic. While it may be easy to

compare the base price of an item online, it may not be easy to see the total cost up

front. Additional fees such as shipping are often not be visible until the final step in the

checkout process. The problem is especially evident with cross-border purchases,

where the cost indicated at the final checkout screen may not include additional fees

that must be paid upon delivery such as duties and brokerage. Some services such as

the Canadian based Wishabi attempts to include estimates of these additional cost, but

nevertheless, the lack of general full cost disclosure remains a concern.

Privacy

Privacy of personal information is a significant issue for some consumers. Different legal

jurisdictions have different laws concerning consumer privacy, and different levels of

enforcement. Many consumers wish to avoid spam and telemarketing which could result

from supplying contact information to an online merchant. In response, many merchants

promise to not use consumer information for these purposes, or provide a mechanism

to opt-out of such contacts.

Many websites keep track of consumer shopping habits in order to suggest items and

other websites to view. Brick-and-mortar stores also collect consumer information.

Some ask for a shopper's address and phone number at checkout, though consumers

may refuse to provide it. Many larger stores use the address information encoded on

consumers' credit cards (often without their knowledge) to add them to a catalog mailing

list. This information is obviously not accessible to the merchant when paying in cash.

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Hands-on inspection

Typically, only simple pictures and/or descriptions of the item are all a customer can rely

on when shopping on online stores. If the customer does not have prior exposure to the

item's handling qualities, they will not have a full understanding of the item they are

buying. However, written and video reviews are readily available from consumers who

have purchased similar items in the past. These can be helpful for prospective

customers but can also be based on personal preferences. Hence, reviews from other

consumers may not reflect end-user satisfaction once the item has been received.

Because of this, many consumers have begun going to real-world stores to view a

product, before purchasing online, a practice known as showrooming (using the store as

a showroom for the online merchant). Brick-and-mortar merchants have responded with

various countermeasures. For example, Target has requested distributors give them

equally low prices, or alternatively, products available exclusively from their store.

CONCLUSION

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BIBLIOGRAPHY

Websites

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www.shoppingnavigator.co.uk

www.ezinearticles.com

www.theretailersadvantage.net

www.retailresearch.org

www.retailsurvey.org

Books

E retailing , Charles E. Dennis, Tino Fenech, Bill Merrilees

Retailing Management (Hardcover) by Michael Levy (shelved 2 times as retail-business)

Retail Analytics: The Secret Weapon (Hardcover) by Emmett Cox (shelved 1

time as retail -business )

Basics Marketing 01: Consumer Behaviour By: DR Hayden Noel Publisher: AVA

Publishing

The role of perception in consumer behavior, Diplomkaufmann (FH) Marco Erlenkamp

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