Consumer Behavior Towards Online Shopping in India - Consumer Behavior Assignment Help

Assignment Task

EXECUTIVE SUMMARY
The main aim of research is to find out consumer behavior towards online shopping that what is buying behavior of people of India to buy goods online and which mode of payment is more preferred. The objective of this research is to make investigation and analysis for consumer behavior towards online shopping in India. The purpose of research is to discover answers through the application of scientific Procedures regarding online shopping and mode of payment.
Here in this research study exploratory research design is selected with convenience sampling method with 50 sample size. Data is collected through primary data collection (through questionnaire) and secondary data collection methods (books, journals, old research reports).
Major findings made from this research study shows that respondents are accessing online shopping websites through their mobile phone only and respondents prefer applications of online shopping from their device. Respondents prefer to buy from Amazon, Makemytrip, Flipkart and Bookmyshow. Nobody prefer to buy from Infibeam and Craftsvilla.
Limitations of the study are: People were not ready to fill in the questionnaire. Many of the surveyed people did not reply all the questions. The time period given for study was very limited. The sample size was very small which is may not represent the entire population of India. Area covered for this research is only urban area where people are using internet frequently. Rural area is not covered.
Conclusions made through this research study are post purchase activity is not dependent on gender of customers. There is relationship between mode of payment and income of customers. Mode of payment is not dependent on age of customers. Maximum respondents from India prefer to buy from Amazon. Customers expects faster delivery of goods ordered online. There is no relationship between gender and amount spent on last purchase.
 

INTRODUCTION TO E COMMERCE
The internet is being developed rapidly since last two decades, and with relevant digital economy that is driven by information technology also being developed worldwide. After a long term development of internet, which rapidly increased web users and highly speed internet connection, and some new technology also have been developed and used for web developing, those lead to firms can promote and enhance images of product and services through web site.
The Internet has transformed the way consumers transact for their daily needs • be it ordering food, booking movie tickets or even booking a cab. Online shopping is one category which has witnessed unprecedented growth in the last two years. This revolution is largely led by innovations which in many ways are unique to India as compared to rest of the world.
Lack of credit card penetration, poor infrastructure, etc. for many years hindered the growth of this category. Cash on delivery as a concept is unheard of in many markets and has been a big driver for trial. Also, instead of investing in building in house delivery team, brands have been working on tie-ups with grocery stores, India post etc. to increase their delivery reach. There are many more such examples of innovation and customer centricity which is driving success for online shopping sites and apps in India.
As the recent researches have indicated that, the internet shopping particularly in business to consumer (B2C) has risen and online shopping become more popular to many people? For instance, the Dell computer company have reached 18 million dollars sales through the internet during the first quarter of 1999. As a result, about 30% of its 5.5 billion dollars total sales were achieved through the internet (Moon, 2004). Therefore, to understand internet shopping and its impact on consumer behavior could help companies making use of it as a form of doing e-business.

INTRODUCTION TO ONLINE SHOPPING
There are many reasons for such a rapid developing of internet shopping, which mainly due to the benefits that internet provides. First of all, the internet offers different kind of convenience to consumers. Obviously, consumers do not need go out looking for product information as the internet can help them to search from online sites, and it also helps evaluate between each sites to get the cheapest price for purchase. Furthermore, the internet can enhance consumer use product more efficiently and effectively than other channels to satisfy their needs. Through the different search engines, consumers save time to access to the consumption related information, and which information with mixture of images, sound, and very detailed text description to help consumer learning and choosing the most suitable product.
However, internet shopping has potential risks for the customers, such as payment safety, and after service. Due to the internet technology developed, internet payment recently becomes prevalent way for purchasing goods from the internet. Internet payment increase consumptive efficiency, at the same time, as its virtual property reduced internet security. After service is another way to stop customer shopping online. It is not like traditional retail, customer has risk that some after service should face to face serve, and especially in some complicated goods.
In last two years many e-commerce websites have come up and competing one another with striking deals like free shipping, coupons, free gifts, easy return policy, and many others. The latest data reveals that Flipkart, Amazon, Snapdeal, Paytm, Myntra, eBay, Jabong, Shopclues, Homeshop 18, and Infibeam are the top ten e-commerce websites in India. Flipkart is one of the biggest Ecommerce giant that arrived as the top among e- commerce websites in India.

Advantages of Online Shopping
Online shopping is a form of electronic commerce whereby consumers directly buy goods or services from a seller over the Internet without an intermediary service.
Easy to find:
Finding a product online is much easier than looking for it in the local store. You can search any product easily by using the search engine feature of an online shopping website.

Products can be cheaper:
Sometime a product can be much cheaper in another country than your country. In this case it would be wise to shop online to save some money.
Save time and energy:
You don't have to waste your time in going to store and standing in front of the crowd.
Freedom of choice:
Freedom of choice is very high in online than shopping from a nearby store. In online you can choose the product you are looking, from a vast range of products.
Freedom of price flexibility:
You will enjoy the freedom of price flexibility. If you don't like the price of a product from an online shop, you can switch to other online store to look for cheaper price.
High satisfaction percentage:
Now a days shopping online is very reliable. The percentage of satisfaction is very high.
Buyer protection:
Dependable websites like EBay provides buyer protection to motivate people to buy from their site. This highly trusted websites will give your money back if any seller do not deliver the item or deliver an item which does not match with the description.
Rare product:
Shopping online is very useful in buying rare products.
Privacy:
There are some products which you don't want to buy publicly. You can buy any kind of product from online web store anonymously to maintain your desired privacy
E-business:
The progress of online business is actually helping millions of people. Now people can buy and sell from their home. People who cannot afford to buy or rent a shop, can easily open an online store and sell items from their home.

Limitations of online shopping:
Delay:
The main disadvantage of online shopping is, you cannot receive the product immediately. Sometime it would be preferable to buy an item instantly if the delivery time is too long.
Inferior product:
You don't know about the actual quality of the product. As a result you might end up with inferior quality product.
Delivery Problem:
Delivery risk occurs when the seller fails to deliver the original product or delivers a damaged (inferior/duplicate) product due to shipping problems.

Scam:
This is why a buyer should always buy from trusted websites only because trusted websites would take care of any fraud to maintain their reputation
The largest of these online retailing corporations are Flipkart, Snap deal, Amazon.com, and eBay. Retail success is no longer all about physical stores. This is evident because of the increase in retailers now offering online store interfaces for consumers. With the growth of online shopping, comes, the concepts of satisfaction and loyalty for website which involved in providing services on the website and transacting online. Companies before using effective marketing strategies analyze various factors to convert potential customers into active ones. The five dominant factors which influence consumer perceptions of online shopping are Information, Ease of use, Satisfaction, Security/Privacy, Proper Utilization.

CONSUMER BEHAVIOR TOWARDS ONLINE SHOPPING
Online consumers are always seeking new products, new attractiveness and the most important thing being price compatibility with their budget. The internet is the best way to save time and money through purchasing online within their range of budget at home or in anywhere. Online consumers don’t have limits to online shopping. They also use internet for comparison of prices of goods and services, news, visit social networks and search information and so on.
Analyzing consumer behavior is not a new phenomenon for scholars. Philip Cotler, marketing expert, have studied on this topic. Theories about consumer behavior have been used to develop an effective marketing strategy. Moreover, it is impossible to think marketing without the Internet in today's world. Online marketing is the topic that have been researched and made applications many times by researcher from past to nowadays. Studies on online shopping investigated the factors that influence online shopping as well as motives for, value of and antecedents of online buying behavior. As a result, the academic researchers and the business world started to focus on the consumer side of the online purchasing behavior and a lot of researches and articles were prepared to make guidance for the development of online shopping.
 

PAYMENT
New payment methods have developed and traditional payment channels have adapted to online shopping. Payment by credit card continues to predominate worldwide, however alternative payment methods such as E-Wallets are on the rise, by far outpacing the growth of credit card use. Mobile payments are also growing rapidly.
An analysis of real time metered smartphone usage data with Nielsen Informate Mobile Insights reveals how Indian consumers are using mobile payment apps. Overall time spent on mobile payment apps has increased by nearly 1.5x, with users spending an hour and a half on mobile payment apps every month.[13]

Findings indicate that even though the penetration of mobile payment apps among users is similar across towns of all sizes (60% of those in large towns and 58% of small town use them), usage is higher among small town users, with these consumers spending 109 minutes a month on these apps. But such limitations aside, the ease of use coupled with the evolution of smartphone users have led to massive growth in popularity of these apps over a short span of time with users spending as high as one hour per month on them.[14]
Online shoppers generally 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:
Cash on delivery (C.O.D.)
Debit card / Credit card
E-wallet
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.

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