Project Dissertation On Consumer Behavior In Online Shopping Submitted To Lovely Professional University In partial fulfillment of the requir ements

for the award of degree of BACHELOR OF BUSINESS ADMINSTRATION Submitted by: Group No-46 Supervisor: Kuljeet Minhas Prashant Priyadarshi Roll n o-17 Nitish Arora Nandni Kashyap Roll no-15 Roll no-20 DEPARTMENT OF MANAGEMENT LOVELY PROFESSIONAL UNIVERSITY PHAGWARA (2010-11) 1

TO WHOM SO EVER IT MAY CONCERN This is to certify that the project report entitled Consumer behavior in online s hopping-carried out by Nitish Arora, (S/O) Satish Kumar Arora, Prashant Priyadar shi, (S/O) Sanjay Kumar Mishra, Nandni Kashyap, and (D/O)Sham lal kashyap has be en accomplished under my guidance & supervision as a duly registered BBA (H) studen t of Lovely Professional University Phagwara. This project is being submitted by them in the partial fulfillment of the requirements for the award of the master of business Administration from Lovely Professional University. .There disserta tion represents their original work and is worthy of consideration for the award of the degree of bachelor of Business Administration. KULJEET MINHAS LECTURER IN MANAGEMENT LHSB Lovely Hons. School of Business Date: 17/5/2010 2

Declaration I, Nitish Arora, Prashant Priyadarshi , Nandni hereby declare that the project r eport entitled Study on Consumer Behavior in Online Shopping has been written an d submitted under the guidance of Miss kuljeet Minhas. I further declare that it is original work done as a part of our academic course and has not been submitt ed elsewhere. The conclusions and recommendations written in this project are ba sed on the data collected by me while preparing this report. Prashant Priyadarshi 10803272 Nitish Arora 10806134 Nandni Kashyap 10809033 3

TABLE OF CONTENTS S.No Particulars Chapter Page number 1 1.Introduction (Theoretical Foundation, Evolution of subject and its Dimensions 1.1 Executive summary 1.2 Introduction 1.3 Theoretical Foundation 1.3.1 Online S hopping in India 1.3.2 Rising connectivity 1.3.3 Factors that Boot Online Shoppi ng in India 1.3.4 Few Facts about Online Shopping 12 10 12 14 14 14 15 1.3.5 Changing Attitude Towards Online Shopping 16 4

2 3 Review of literature Need,Objectives ,Scope & Methodology 3.1 Need 3.2 Objective 3.3 Scope of Study and Methodology 3.3.1 Scope of Study 3.3.2 Research Methodol ogy 3.3.3 Research Strategy 3.3.4 Descriptive research method 3.4 Sample Design 36 36 36 37 39-44 45-58 63-67 63 64 5 34 35 18-32 33-36 4 Data analysis [factor analysis through spss] 4.1 Pie charts 5 Summary ,Conclusion ,Limitations & Recommendations 5.1 Summary

5.2 Conclusion 5.3 Limitations& Recommendations 6 7 References Appendix,(Questio nnaire.Terms, Abbreviations,Documents,Performa,Financial Statements 65-69 69-73 74-78 Table of figures S.NO Particular Chapter 4 Page no Fig 1.1 Fig 1.2 Fig 1.3 Fig 1.4 Fig 1.5 Fig 1.6 Fig 1.7 Fig 1.8 Fig 1.9 Fig 2.0 Fig 2.1 Fig 2.1 Fig 2.2 Fig 2.3 6 40 40 41 42 43 44 45 46 47 48 49 50 51 52

Table of Figures S.No Particular Page No. Tables No . 1 Table 1.1 Table 1.2 Table 1.3 Table 1.4 60 60 60 60 60 Table 1.5 Table 1.5 Table 1.6 Table 1.7 Table 1.8 60 60 60 60 60 60 Table 1.9 Table 1.10 Table 1.11 62 62 62 62 7

Table 1.12 Table 1.13 Table 1.14 63 63 63 8

CHAPTER-1 INTRODUCTION TO SUBJECT 9

1.1Executive summary The growing use of Internet in India provides a developing prospect for online s hopping. If E-marketers know the factors affecting online Indian behavior, and t he relationships between these factors and the type of online buyers, then they can further develop their marketing strategies to convert potential customers in to active ones, while retaining existing online customers. This project is a part of study, and focuses on factors which online Indian buye rs keep in mind while shopping online. This research found that information, per ceived usefulness, ease of use; perceived enjoyment and security/privacy are the five dominant factors which influence consumer perceptions of Online purchasing . Consumer behavior is said to be an applied discipline as some decisions are sign ificantly affected by their behavior or expected actions. The two perspectives t hat seek application of its knowledge are micro and societal perspectives. The online purchasing behavior of online shoppers and factor influencing online shopping behavior and its future perspective. Internet is changing the way consu mers shop and buy goods and services, and has rapidly evolved into a global phen omenon. Many companies have started using the Internet with the aim of cutting m arketing costs, thereby reducing the price of their products and services in ord er to stay highly competitive markets. Companies also use the Internet to convey , communicate and disseminate information, also to conduct satisfaction surveys with ahead in to sell the product, to take feedback and customers. Customers use the Internet not only to buy the product online, but also to compare prices, product features and after sale service facilities they will rec eive if they 10

purchase the product from a particular store. Many experts are optimistic about the prospect of online business. In addition to the tremendous potential of the E-commerce market, the Internet provides a unique opportunity for companies to more efficiently reach existing a nd potential customers. Although most of the revenue of online transactions come s from business-to-business commerce, the practitioners of business-to-consumer commerce should not lose confidence. It has been more than a decade since busine ss-toconsumer E-commerce first evolved. Scholars and practitioners of electronic commerce constantly strive to gain an improved insight into consumer behavior i n cyberspace. Along with the development of E-retailing, researchers continue to explain Econsumers behavior from different perspectives. Many of their studies h ave factors or assumptions which are based on the traditional models of consumer behavior, and then examine their validity in the Internet context. 11

1.2 Introduction Internet is changing the way consumers shop and buy goods and services, and has rapidly evolved into a global phenomenon. Many companies have started using the Internet with the aim of cutting marketing costs, thereby reducing the price of their products and services in order to stay ahead in highly competitive markets . Companies also use the Internet to convey communicates and disseminate informa tion, to sell the product, to take feedback and also to conduct satisfaction sur veys with customers. Customers use the Internet not only to buy the product onli ne, but also to compare prices, product features and after sale service faciliti es the will receive if they purchase the product from a particular store. Many e xperts are optimistic about the prospect of online business. In addition to the tremendous potential of the E-commerce market, the Internet provides a unique op portunity for companies to more efficiently reach existing and potential custome rs.Although most of the revenue of online transactions comes from business-tobus iness commerce, the practitioners of business-to-consumer commerce should not lo se confidence .It has been more than a decade since business-to-consumer E-comme rce first evolved. Scholars and practitioners of electronic commerce constantly strive to gain an improved insight into consumer behavior in cyberspace. Along w ith the development of E-retailing, researchers continue to explain E-consumers b ehavior from different perspectives. Many of their studies have posited new emer gent factors or assumptions which are based on the traditional models of consume r behavior, and then examine their validity in the Internet context. 12

1.3Theoretical Foundation The Internet has developed an into a new distribution channel and online transac tion are rapidly increasing. This has created a need to under how the consumers perceive online purchasing. Price, Trust and Convenience were identified as impo rtant factors. Price was considered as to be a most important factor for a major ity of the students. The internet has created a paradigm shift of the traditiona l way people shop. A consumer is no longer bound to opening a times or specific location. So he can become active at virtually any time any place and purchase t he products or services. The internet is relatively a new medium for communicati on and the information exchange that has present in everyday life. The number of internet user is constantly increasing which is also signifies that online purc hasing is increasing. The rapid increasing is explained by the consumer behavior . The internet is considered a mass medium that provides the consumers with purc hase characteristics as no other medium. Certain characteristics are making it more convenient for the consumer compared to the t raditional way of shopping, such as the ability to any time view and purchase pr oducts visualize the needs with products and discuss products with other consume rs. Online shopping is the process of consumer go through the when they decide t he shop on the internet. The internet has developed into a new distribution chan nel and the evaluation of this channel. E-commerce has now identified. Using the internet to shop online has become 13

one of the primary reasons to use the internet combined with searching for produ cts and finding the information about them. Therefore internet develop the h Com panies use the Internet to also convey, communicate and disseminate information, to sell the also to conduct sat isfaction surveys with customers. product, to take feedback and Customers use the Internet not only to buy the product online, but also to compa re prices, product features and after sale service facilities they will receive if they purchase the product from a particular store. Many experts are optimisti c about the prospect of online business. Due to the rapid development of the tec hnologies surrounding the Internet, a company that is interested in selling prod ucts from its web site will constantly has to search for an edge in the fierce c ompetition. Since there are so many potential consumers, it is of the out most i mportance to be able to understand what the consumer wants and needs. 1.3.1Online Shopping In India It is a fact that a great online shopping revolution is expected in India in the coming years. There is a huge purchasing power of a youth population aged 18-40 in the urban area. 1.3.2Rising Connectivity If we observe the growth of Internet Subscribers from the above graph, it is get ting doubled year by year. The usage of internet in India is only 4% of the tota l population. This is also getting increased day by day as the costs of computer s are decreasing and net penetration is increasing. The cost of internet usage i s also getting lower, with good competition among the providers. Wi-Fi & Wimax s ystem has also started in India. This will increase the usage as it goes more on wireless internet. Indians are proving every 14

time that they can beat the world when it comes to figures of online shopping. M ore and more Indians are going to online shopping and the frequency of Indias onl ine buying is crossing the overall global averages. 1.3.3Few Factors That Boost Online Shopping in India Rapid growth of cybercafs across India Access to Information The increase in numb er of computer users Reach to net services through broadband Middle-class popula tion with spending power is growing. There are about 200 million of middle-class population good spending powers. These people have very little time to spend fo r shopping. Many of them have started to depend on internet to satisfy their sho pping desires 1.3.4 Few Facts about Online Shopping The figures from IAMAI show that the internet users in India will grow to 200 mi llion by 2010. Around 25% of regular shoppers in India are in the 18-25 age groups, an d 46% are in the 26-35 year range. Indian online matrimonial sector is worth aro und $230 million Worldwide E-commerce is only growing at the rate of 28%, since India being a younger market, the growth of e-commerce is expected at 51% in the coming years. 15

In line with global trends finally India has also started shopping online these days. As per the study by IAMAI online shopping in India has rose from $11millio n in 1999-2000 to $522 million in 2007 and it is expected to rise above $700 mil lion by end March 2010. 1.3.5 Changing Attitude towards Online Shopping: Awareness, Future Demand Focus for Emerging Markets & Current Issues Malls springi ng up everywhere and yet people are E-shopping! And not in small numbers either. Consumers are more rational nowadays and have ability to get the choices from t he market. Awareness among the consumers is spread through internet. The number of internet users is increasing day by day which attracts people who have an opt ion to buy online. It was never thought that Indians would go in for e-shopping in such a big way. Ticketing, travel bookings and even books and movies seem fin e to buy online. Knowing that in India sizes vary from brand to brand and qualit y is inconsistent, even of some electronic items, how is it that there are peopl e buying these items online? In India there are some segments of people who have not yet tried purchasing over internet. 16

CHAPTER-2 Review of Literature 17

2.1 Review of literature Petrovic Dejan (2006) in his study on Analysis of consumer behaviour online expl ained that the most relevant behavioural characteristics of online consumers and examine the ways they find, compare and evaluate product information. Compariso n of the newly collected survey data with the existing consumer behaviour theory resulted in detection of a number of issues related to a specific consumer grou p. The purpose of this report is to translate these findings into a set of imple mentation activities on strategic and technological level. Execution of these re commendations will result in better conversion of visitors into customers and en courage customer loyalty and referrals.The focus group of this study will be you ng adults aged between eighteen and thirty-four interested in buying a mobile ph one or a related product . 18

Shun &Yunjie (2006) in their study showed that there are product types, which ar e more likely to be sold online such as software, books, electronics and music. Reason for this is that when purchasing these types of products, one does not re quire personal inspection and most, if not all features, can be outlined in the product description and images. Most products in the mobile phone family belong to this category. According to the recent research on consumer behaviour on the Internet users (Cotte, Chowdhury, Ratenshwar& Ricci, 2006), there are four disti nct consumer groups with different intentions and motivations: Exploration Entertainment Shopping Information Music Videos, Lyrics - Daily updated collection of music videos and lyrics. Majo rity of young adults interviewed for purpose of this research tend to be active information seekers. A high level of technological confidence within this group tends to be an encouraging factor when it comes to product information research online.The following analysis presents both, focus group results and behavioural theory in a parallel fashion divided into two main research topics: Information Retrieval and Search Patterns Perception of Product Information Online These tw o areas is mutually dependent and particularly important in a market where consu mers have the power to choose the right 19

product from a number of competing suppliers. Well-structured product informatio n that cannot be found easily online is as much of a problem as is having easily accessible information that does not meet the consumer's expectations Anders Hasslinger; Selma Hodzic; Claudio Opazo (2008-02-01) in their study they showed that developed into a new distribution channel and online transactions are rapidly increasing. This has created a need to understand how t he consumer perceives online purchases. The purpose of this dissertation was to examine if there are any particular factors that influence the online consumer. Primary data was collected through a survey that was conducted on students at th e University of Kristianstad.Price, Trust and Convenience were identified as imp ortant factors. Price was considered to be the most important factor for a major ity of the students. Furthermore, three segments were identified, High Spenders, Price Easers and Bargain Seekers. Through these segments we found a variation o f the different factors importance and established implications for online book stores 20

Harris Interactive (2009)in their study of online customer experience. The survey found that online customer experience reached an inflection point in 2009 . The percent of consumers who have experienced problems when conducting transac tions online showed its first substantial decrease in five years -- from approxi mately 87% in all previous Tealeaf surveys to 80% in 2009. While the percent of consumers experiencing online transaction problems, at 80%, remains high (the po tential online shopping dollars impacted by transaction problems rings up at $47 .6 billion), this improvement points to a growing business focus on delivering b etter customer experiences.The survey sheds light on forces driving this acceler ated online customer experience focus, including the down economy and increased consumer power due to experience-sharing via social media. It also examines cons umer behavior when transacting online, call center behavior related to online is sues and mobile commerce. Verticals represented in the findings include retail, insurance, travel and financial services 21

San Francisco, CA 6th October 2009 - the leader in online Customer Experience Management software (CEM), today announced the results of the 5th ann ual survey of online consumer behavior, commissioned by Tealeaf and conducted by Harris Interactive [results available at www.tealeaf.com/Harris]. The survey fou nd that 48% of U.S. online adults say that they are now conducting more online t ransactions than they did in the past given the current economic climate. Howeve r, 80% of adults who have conducted an online transaction in the past year exper ience problems when doing so in 2009. Previous Tealeaf surveys have consistently shown that approximately 87% were affected. This improvement over prior years m ay be attributed to a growing business focus on delivering better online custome r experiences. While this reported decline in online transaction issues is good news, online customer experience is still very much a work in progress. The perc entage of consumers affected by issues such as error messages (38%), endless loo ps (19%) and login problems (28%) is still extremely high. 1 Further, the resulting business impact is significant, as 32% of those who experience issues when conducting transactions online would simply take their business elsewhere ( to either an online or offline competitor) or abandon the transaction entirely. In 2009, $47.6 billion 22

will potentially be impacted by online transaction problems, on U.S. shopping we bsites alone. Bikramjit Rishi (2010) in their study on Online shopping is an innovative option of distribution available in the hands of marketers. It is innovative and creati ve because marketers can experiment with it in form, content, visibility and ava ilability. In India online shopping is considered as a relevant alternative chan nel for retailing and it is now an important part of the retail experience. This research study is an empirical study to find out the motivators and decisional influencers of online shopping. The sample has been selected from the youth popu lation as this group of people actually use internet to buy online. The study hi ghlights that reliability; accessibility and convenience are the major motivator factors which motivate the Indian consumer to buy online. Similarly, reluctance and preference are the two decisional factors which influence the decision. 23

Kamali and Loker (2002), in their study Internet retail sales represent a new an d increasingly vital commercial milieu. E-commerce or electronic commerce saw sa les revenues grow 12.1 percent in 2001 to $31.4 billion a figure expected to rea ch $81.1 billion by 2006 (Kamali & Loker, 2002). While it is clear that many mor e consumers are electing to shop online than in the past a shift in behavior tha t may be due to the sense that online shopping is safer and more secure than it was initially and to the adoption of alternative shopping avenues. This essay wi ll examine these issues, arguing that browsers become buyers in cyberspace as pe rception of safety, product quality, and retailer reliability increase an idea a lso advanced by Li, Luo, Lepkowaska-White and Russell . Atanasov (2001) in their study it is anticipated that the worldwide market for b usinessto-business and business-to-consumer e-commerce will total $3.1 trillion in 2004 as compared to $350.4 billion in fiscal 2000-2001. Among the most profit able products and services sold online are consumer goods such as books, videos, music, computers and other tech products, and travel (Schmerken, 2001). Other p rofitable sectors include investment transactions, which Schmerken (2001) consid ers to have generated a wave of corporate spending on e-commerce. The Internet a nd its myriad e-commerce or marketing sites, represents what researchers believe to be the security concerns of online shoppers and potential shoppers. These re searchers and others reported that online buyers are also concerned about securi ty issues when making online purchases. Though many consumer concerns regarding the inherent safety of financial transactions online have been resolved through the development of sophisticated encryption programs, many 24

consumers require additional assurance that their financial data will be held in confidence. Other security issues that were identified by Mauldin and Arunachal am (2002) focus on retailer disclosures, information risk, product risk, and fam iliarity with the retailer and the product. Generally, Mauldin and Arunachalam ( 2002) found that intent to purchase rather than merely browsing online increases in direct association with a sense of security and comfort. Retailers who offer their products online are therefore advised to emphasize product disclosure and retailer disclosure and reduced information risk in their e-commerce sites. Tho ugh most online retailers do provide clear descriptions of security procedures, some Internet shoppers still avoid using credit cards online. Overcoming resista nce to this fear is one of the key tasks that must be under taken. Ogenyi Ejye Omar, Alan Hirst (2006) in their study they evaluates women's attitude as an overall inclination towards apparel shopping online via e-mail qu estionnaire. Its findings suggest that women generally show positive attitudes t owards shopping online for apparel. Women who shop for apparel online are aware of some of the discouraging features of online shopping, but these features do n ot deter them from buying online. The implication for online retailers is that t hey should focus on making the experience of online shopping more accommodating and more user-friendly. This is important because the positive features of onlin e shopping ('convenience', 'usefulness', 'ease of use', and 'efficiency') appear to be more important than the negative features ('lack of security', 'privacy o f information' and 'online fraud'). 25

Ruiliang Yan, John Wang (2009) in their research it provides a useful framework to help business marketers identify the effect of consumer online purchase costs on firm performances in online and traditional channel competition. A game theory model is developed to determine the optimal strategies for online and traditiona l retailers. We demonstrate that consumer online purchase costs always have a va luable impact on firm profits, and further show that consumer online purchase co sts always have a much more valuable impact on firm profits whenever the traditi onal retail transaction costs and the product web-fit change. We also find that consumer online purchase costs have a greater impact on the retailer's profits i n a Stackel berg competitive system than in a Bertrand competitive system. Based on our results, managerial implications are discussed and probable paths of fut ure research are identified. Scott M. Smith, Chad R. Allred, William R. Swinyard(2008) in their research paper they discusses online shopping in context of diffusion of innovat ion theory. It proposes that online shopping is a discontinuous innovation whose adoption rate is influenced by several of Rogers' (2004) diffusion deterrents. A new 12-item 'Computer Competence Index' (CCI) is proposed and tested using dat a from an internetadministered US probability study of 1800 online users. EShopp ers are profiled using a tertile split of the CCI. Each tertile's demographics, computer activities, computeroriented lifestyles, and online purchase activities are reported. Evidence is presented that 26

concepts related to the diffusion of innovation may explain resistance in the gr owth of online shopping A.M. Sakkthivel (2009) in their research paper aims to identify the impact of demographics on consumer buying behaviour towards online purchase of different p roducts based on the involvement and investment (High, Medium and Low). It attem pts to unearth the impact of the demographics on online purchase which is at pre sent relatively limited. It would help the marketers to identify the demographic profile of consumers which is otherwise not known due to the intangible nature of internet. The findings would help the marketers to design their offerings bas ed on the demographic profile of online consumers and would help the online mark eters to identify and segment the online consumers which will enhance their focu s and eventually leads to financial growth. 27

Jianwei Hou, Cesar Rego (2007) in their study in traditional auctions, it is often assumed that bidders are a homogenous group. However, since most online bidders are average consumers instead of professional bidders, we suspect that online bi dders are a heterogeneous group. The purpose of this paper is to explore the typ es of online bidders based on their real bidding behaviour in the context of con sumer-to-consumer online auction market. A cluster analysis is employed and four types of online bidders are finally identified in a private value auction, name ly, goal-driven bidders, experiential bidders, focused bidders, and opportunisti c bidders. The profile and performance of each group are also discussed. Tomomi Hanai, Takashi Oguchi (2009) in their study to investigate what kind of information contributes to trust formation in online shopping. Twenty-seven f emale undergraduate students were recruited and asked to evaluate the trustworth iness of 20 online shopping websites. All the online shopping websites dealt wit h branded products where there is greater emphasis on the trustworthiness of onl ine shops or products. The results show that information described on the websit es was classified into two categories, firstly, information about the shop and i ts procedures and services. Secondly, the concrete information necessary for the consumption process, such as payment information and return information, which heightens the reliability of these shops.The term brand originally refers to a desc ription or trademark which indicates a type of product made by a particular comp any. However, in modern Japanese society it refers to those branded products that are perceived to have a higher quality than other similar products. Thus, the t erm brand authenticates that its products belong to a high-class, 28

and the people who possess these branded products are regarded as exclusive peopl e through the basking-in-reflected glory process (Cialdini, Borden, Thorne, Walker, Freeman, & Sloan, 1976). The branded products interest female young people and recently they have been more inclined to purchase them via online shopping. Howe ver, they tend to refrain from purchasing these products via online shopping due to their distrust of it. Consequently, it becomes more and more important to an alyse what kind of information contributes to trust formation in online shopping . Female Undergraduate Students Attitudes toward Branded ProductsFirst, we introd uce several surveys for determining the attitude towards, and ownership of, bran ded products among female young people, especially female undergraduate students in Japan, who are the target group of this study. Infoplant (2007) showed that nearly half of all people are interested in some branded products. Although bran ded products generally attract the attention of various kinds of people, young f emales are especially interested in branded products. Infoplant (2007) revealed that more than 60% of females under 20 years of age and nearly 80% of females in their twenties have purchased some branded products. Furthermore, the percentag e of people who usually buy new branded products is about 20% among females unde r 20 years of age and more than 10% in females in their twenties. David Anderson (02.02.2006) in their research carried out by a consumer behaviour researcher at Henley Management College has investigated what drives p eople to search online. The findings reveal that convenience, time-efficiency an d personal control are the key drivers for consumers to search online, rather th an cost. It also shows that the relationship between traditional and online reta iling outlets needs to be more unified E-shopping has changed the face of retail , and surfers are now looking for spring sale bargains. This is following a bump er e-Christmas, where Internet shopping soared almost 50% during the 10-week run -up 29 to Christmas 2005 (IMRG).

However, the new findings reveal that convenience and personal control are the k ey drivers for consumers to search online. Dr Susan Rose, from Henley Management College, said: What motivates online shoppers is the ability to shop, where, whe n and how they like. Nowadays people can shop over their Shreddies in the mornin g. The research, that analyses data from 304 electrical goods Internet shoppers, provides businesses with a guide to getting the information highway buzzing wit h potential customers. Big-ticket items such as digital TVs, cameras, or iPods n ow feature on our eshopping list. The Internet provides a rich source of informa tion about brands and retail channels that enable us to search and find informat ion to help us with our final purchase decision. For businesses there are some s teps to help them embrace the Internet revolution with success.A key factor driv ing Internet use for online window shopping is its usefulness in our personal live s. The Internet frees time and makes the information search process,Research sug gests that people search online for some goods, yet buy from a traditional high street retailer, or look around for goods in shops, then take their search onlin e. In turn, it is essential for retailers who operate both on and off line to en sure that they embrace a joined up process that appears seamless to the customer . Some retailers have still to successfully unite the two retailing methods - th is is key to contemporary customer service. Factors such as how much the medium challenges us mentally and our confidence to navigate and understand the technol ogy can turn us on or off the idea of browsing online for products. A clear divi de is appearing between the occasional online shopper and the regular experience d user. Concerns about how easy the system is to use have almost disappeared for online shopping enthusiasts, but for occasional users etailingsites need to be easy to navigate. Websites must be accessible and operate efficiently. The resea rch found that the expectation of getting a good financial deal is still a stron g motivator to seek out products online, but this is secondary to the importance but, many people steer clear of electronic buying because of security worries. Only once online retailers can reassure customers about fraud and privacy, will the online shopping 30

curve really take off. Worries about the risk involved, in terms of financial tr ansaction and privacy remain. A move from big brands to bargains may only take place once. Rajeev Kamineni (JAN 1999) in their study The World Wide Web can change human behaviour and human interactions to a very large extent. Web based shoppin g behaviour is one major example to point out the trends in this direction. This study is of a very exploratory nature and it intends to establish the differenc es between several webbased shoppers from different parts of the world. Several critical factors associated with online shopping behaviour will be explored. A c ross cultural data set will be collected and an illustrative description of the shoppers will be provided. As a final step the cross cultural differences betwee n several shoppers will be explored. One question which will run as a theme thro ughout the course of this paper is, Will the traditional consumer behaviour theor y and research be altered by the advent of web based shopping? There is a huge di fference between a physical store and its electronic counterpart. A help button on the home page of the web-shopping site replaces the sales clerks friendly advi ce and service. The familiar layout of the physical store becomes a maze of pull down menus, product indices and search features. Now more than ever, the promis e of electronic commerce and online shopping will depend to a great extent upon the interface and how people interact with the computer. At the same time, there are some inherent difficulties in maintaining an online inventory. In a regular store, the managers can pull out a product from the shelf if they feel that it is not fast moving or has no demand. This is a privilege that cannot be extended to the online retail store. 31

Anita desai (2003) in her sudy E-tailing is the practice of selling retail goods on the internet. It is the abbreviated version of electronic retailing which essentially constitutes business to consumer transaction. While the concept of online retail ing or etailing is no longer in its nascent stage; it continues to evolve, as ad vanced e-commerce applications act as a potent catalyst in the development of etailing. The idea of online retailing or e-tailing which almost every net-savvy individual is familiar with; offers a convenient mode of shopping online and the consumer gets to choose from a diverse range of products and services as oppose d to the analogous physical shopping experience. Furthermore, online retailers o r e-tailers get to expose and sell their products to a global audience through t heir e-stores. (Also termed as online stores, internet shops, web shops etc.) Th e E-commerce industry plays a vital role in its growth and development. The cons umer or buyer is usually provided with detailed information and description of t he product which helps them make a judicious choice before making an online purc hase. For consumers who face a paucity of time or want a diverse range of produc ts to choose from, e-tailing proves to be an ideal option. Every e-tailer wants his/her share of domain amidst the vast World Wide Web galaxy. Due to the intens e competitory quotient involved, every e-tailer out there wants to offer their c ustomer/buyer a smooth and pleasant shopping experience. Therefore, e-tailing is just not restricted to putting up products for sale for consumers to buy. As co nsumers today are well-informed, it is understood that they would make a well in formed decision as well. This involves a fair amount of product research, price comparison and checking the credibility of the e-store 32

CHAPTER-3 NEED, OBJECTIVES, SCOPE & METHODOLOGY 33

3.1 Need The need of this research is to identify and get insight into what main factors the online consumer takes into consideration when most he buy products on intern et what affects their shopping behaviour, basic need of this research is to find out what are the main factors affect the online consumer when considering and m aking a purchase over Internet. 3.2 Objective of the study To study the online shopping behavior of customers To study the factors influenc ing online shoppers and consumers To study the customers level of satisfaction wi th regard to online shopping To examine whether customers prefer online shopping to physical stores. 3.3 Scope of the Study and Methodology 3.3.1 Scope of the study At any given time there are millions of people online and each of them is a pote ntial customer for a company providing online sales. Due to the rapid developmen t of the technologies surrounding the Internet, a company that is interested in selling products from its web site will constantly has to search for an edge in the fierce competition. Since there are so many potential consumers, it is of th e out most importance to be able to understand what the consumer wants and needs . The importance of analyzing and identifying factors that influence the consume r when he or she decides to purchase on the Internet is vital. Since the Interne t is a new medium for there have been new demands set by the consumer. That is w hy it is crucial for the online retailers to know what influences 34

the online consumer. Analyzing consumer behavior is not a new phenomenon. The re nowned marketing expert Philip Kotler has published several works on the topic o f consumer behavior theories. These theories have been used for many years not o nly to understand the consumer, but also create a marketing strategy that will a ttract the consumer efficiently Hence, understanding and identifying the consume r is closely related to the directions a company will take with their marketing strategy. These theories can also be applied to identify the online consumer and to create certain consumer segments. However, some distinctions must still be m ade when considering traditional consumer behavior and online consumer behavior. Since online retailing is a new retailing medium and online consumer behavior i s diverse from traditional consumer behavior, one must identify what influences the online consumer. Analyzing the process that the online consumer goes through when deciding and making a purchase over the Internet, shows some factors that consumers consider these factors need to be identified and taken into account by online retailers in order to satisfy consumer demands and compete in the online market. 3.3.2Research Methodology Data for this study was collected by means of a Survey conducted in Lovely Profe ssional University. The sample size was 100. .The Questionnaire (shown in Annexu re) was used Mainly to test the model proposed for Attitude towards online shopp ing. The type of research was both exploratory as well as Descriptive. Likert fi ve point scales ranging from Strongly Agree to strongly disagree was used as a b asis of Questions. We took around eleven different factors by studying the exist ing models of consumer attitudes that play an important role in online purchase, and then proposed a model leading to online 35

shopping. This model was then tested in our research by the mode of factor analy sis in SPSS. 3.3.3Research Strategy When collecting data to approach the purpose of a research there are two ways in which the data can be collected. In order to acquire a General knowledge about the topic, secondary data is primarily used and is one of the ways by which data can be collected. The second way to collect data is the primary data collection . Usually when a study is Conducted, secondary data is not su fficient enou gh a nd needs to be completed with primary data which is collected by the research. 3.3.4Descriptive Research Method We will condu ct our research in order to collect primary data and reach the obj ective of the Dissertation. We will also be discu ssing which different types of Methodologies that were u sed. Since our research is of descriptive character o ur primary intention was to collect seconda ry data and analyze it. By doing so we found the factors Price, Trust and Convenience. We then collected primary dat a through a survey. The main purpose of the survey was to collect data about Onl ine Consu mer Behavior and the significance of the established factors, Price, T rust, and Convenience In order to be able to find and establish Online Consu mer Segments, Consu mer Traits and Online Behavior had to be identified. The segmen ts were u sed in order to further 36

identify what impact the factors Price, Tru st, and Convenience have on Online C onsu mer Segments. 3.4Sample Design The factors that we intended to examine can be applied to and investigated at an y population that u ses the Internet and bu ys online produ cts Online. Since th ere are time and resource res traints, a specific Population had to be identifie d in order to generalize and create relevant segments. We decided that the sampl e size should contain over 100 respondents and we collected answers from100 resp ondents. The populations for this research are university students at the Lovely Professional University the University was cho sen on a convenience basis. Convenience sampling involves using samples that are the easiest to Obtain and is continu ed until the sampling size that is need is reached. We will attempt to collect as many respondents as possible but since we will be studying students we assume that there will be little variation in the populatio n making it more approved to generalize the response rates. The sampling method for students took also place on a Convenience basis since the students that agre e to answer the questionnaire are those that were chosen Type of Research: Descr iptive Research. Sample Size: 100 37

CHAPTER- 4 DATA ANALYSIS 38

FACTOR ANALYSIS KMO and Bartlett's Test Kaiser-Meyer-Olkin Measure of Sampling Adequacy. .543 Bartlett's Test of Sphericity Approx. Chi-Square 349.989 df Sig. 190 .000 39

Total Variance Explained Communalities Initial q1 q2 q3 q4 q5 q6 q7 q8 q9 q10 q11 q12 q13 q14 q15 q16 q17 q18 q19 q20 1.000 1.000 1.000 1.000 1.000 1.000 1.000 1.000 1.000 1.000 1.000 1 .000 1.000 1.000 1.000 1.000 1.000 1.000 1.000 1.000 Extraction .562 .616 .717 . 584 .638 .688 .570 .718 .713 .778 .576 .625 .521 .766 .669 .589 .781 .500 .688 . 550 Extraction Method: Principal Component Analysis. 40

Comp onent 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 Total 3.075 1.926 1.633 1.441 1.328 1.269 1.135 1.042 .979 .875 .817 .765 .685 .629 .530 .501 .457 .325 .309 .279 Initial Eigenvalues % of Variance Cumulative % 15.373 9.629 8.163 7.203 6.641 6. 345 5.677 5.208 4.894 4.377 4.087 3.826 3.427 3.144 2.651 2.505 2.283 1.626 1.54 5 1.396 15.373 25.002 33.165 40.368 47.009 53.354 59.032 64.240 69.133 73.510 77 .598 81.423 84.850 87.994 90.644 93.150 95.433 97.059 98.604 100.000 Extraction Sums of Squared Loadings Total 3.075 1.926 1.633 1.441 1.328 1.269 1. 135 1.042 % of Variance Cumulative % 15.373 9.629 8.163 7.203 6.641 6.345 5.677 5.208 15.373 25.002 33.165 40.368 47.009 53.354 59.032 64.240 Rotation Sums of Squared Loadings Total 2.091 1.891 1.709 1.563 1.560 1.368 1.33 5 1.331 % of Variance Cumulative % 10.454 9.456 8.546 7.815 7.800 6.839 6.673 6. 657 10.454 19.910 28.456 36.271 44.071 50.910 57.583 64.240 Extraction Method: Principal Component Analysis. 41

Component Matrix a Component 1 q1 q2 q3 q4 q5 q6 q7 q8 q9 q10 q11 q12 q13 q14 q15 q16 q17 q18 q19 q 20 .582 .623 .264 .249 .423 .526 .411 .189 .143 .058 .180 .579 .473 .261 .203 .3 10 .360 .193 .557 .508 2 -.003 .088 -.287 -.549 -.626 .117 .333 .577 .071 .293 .174 .181 .072 .228 .326 .107 .290 -.344 -.032 -.388 3 -.151 .143 .278 -.005 -.0 42 -.195 .238 .359 .547 -.314 -.523 -.327 .098 .146 -.574 .174 .085 .329 .007 -. 031 4 -.118 -.335 .286 .389 -.146 .060 -.261 -.235 .314 .396 -.256 .014 -.227 -. 047 .321 .487 .274 .072 .294 -.229 5 .127 -.265 -.575 -.003 -.117 .262 -.097 .12 0 .315 -.309 .105 .181 -.284 .197 .064 .175 -.461 .403 .188 .041 6 .148 .095 .21 7 .185 .074 .263 -.132 -.081 .158 -.181 .130 .012 -.363 .670 .018 -.299 .236 -.0 98 -.411 -.281 7 -.370 .094 -.051 .185 -.116 -.458 .350 -.207 .400 .075 .355 .30 8 -.030 .125 -.013 -.282 -.064 -.114 .250 -.034 8 .106 .000 .158 .025 .102 -.089 -.128 .318 -.073 .547 .141 -.148 -.134 .344 -.289 .116 -.461 -.213 .156 .082 Extraction Method: Principal Component Analysis. a. 8 components extracted. 42

Rotated Component Matrix Component 1 q1 q2 q3 q4 q5 q6 q7 q8 q9 q10 q11 q12 q13 q14 q15 q16 q17 q18 q19 q20 .202 .698 .169 -.114 .216 -.004 .673 .325 .058 -.042 .095 .337 .644 .026 -.137 -.030 .259 -.005 .328 .421 2 .094 .125 .581 .710 .636 -.013 -.180 -.565 .055 .015 .235 .056 .003 .005 -.113 -.017 .073 .172 .205 .342 3 .701 .249 .030 -.018 .332 .757 -.123 .241 -.305 -.039 .077 .181 .106 .288 .20 2 .209 .105 .099 -.003 .257 4 .091 .010 -.368 .108 -.111 .226 .148 -.281 .036 .0 91 .469 .665 -.007 .014 .671 -.043 .140 -.072 .305 .024 5 a 6 .087 -.100 .071 .169 -.066 .134 .046 .220 .371 .297 -.314 .111 .125 -.122 .093 .726 .003 .319 .639 .152 .062 .170 .111 .134 -.107 .098 .186 .297 .585 .005 .06 9 .145 -.265 .811 -.141 -.032 .030 .008 .037 -.203 7 -.003 .027 .235 -.089 -.112 -.112 -.057 .122 -.340 .823 .146 .006 .004 .092 .1 83 .032 .046 -.588 .059 -.135 8 -.040 .104 .376 .027 -.188 .155 .087 -.062 .133 -.009 -.401 -.006 .093 -.009 . 291 .115 .821 -.088 -.179 -.327 Extraction Method: Principal Component Analysis. Rotation Method: Varimax with K aiser Normalization. a. Rotation converged in 13 iterations. 43

Component Transformation Matrix Compo nent 1 2 3 4 5 6 7 8 1 .643 .153 .258 -.48 0 -.332 -.281 .273 -.051 2 .309 -.815 -.066 .284 -.271 .204 .186 .077 3 .517 .02 3 -.253 -.149 .181 .285 -.719 .120 4 .289 .188 -.670 .159 .303 .010 .439 -.350 5 .324 .086 .287 .637 .302 -.517 -.097 .178 6 .163 .248 .365 .084 .286 .663 .370 .338 7 -.027 .330 -.408 .201 -.528 -.040 .050 .633 8 .086 .314 .184 .435 -.490 . 300 -.179 -.556 Extraction Method: Principal Component Analysis. Rotation Method: Varimax with K aiser Normalization. 44

Q1. TO KNOW THE AGE OF THE REPONDENTS? AGE 0% 14% 7% 31% AGE 15-20 20-25 48% 25-30 30-ABOVE Figure 1.1 INTERPRETATION The above diagram shows us the percentage in the age of responden ts. As it shows that from age 15-20 the number of respondents are31 % and from a ge of 20-25 it is 48 % and from 25-30 it is 14% this is the above data which is shown by the this pie chart 45

Q2 TO KNOW THE GENDER OF THE RESPONDENTS? GENDER 14 MALE 86 FEMALE Figure 2.2 INTERPRETATION As our respondents are mostly from the hostel of Lovely professio nal University and the campus of university itself, we use to get more data from males as they were ready to give their experiences, it this graph itself is sho wing more percentage of males rather than females, the percentage of male respon dents is 86% and percentage of female respondents is only 14%. 46

Q3 TO KNOW THE DEMOGRAPHY WHETER RESPONDENT LIVE IN RURAL OR URBAN AREA? ADDRESS 24 RURAL 76 URBAN Figure 3.3 INTERPRETATION The above diagram is showing the percentage of demography of resp ondents and what is the percentage of respondents who lives in rural or urban re gion,, the above diagram is showing that 76% of the respondents are from urban a reas and 24% of the respondents are from urban area. 47

Q4 TO KNOW THE OCCUPATION OF THE RESPONDENTS? 0 4 10 5 OCCUPATION STUDENT PROFESSIONAL GOVT.EMPLOYEE 90 SELF EMPLOYED OTHER Figure 4.4 INTERPRETATION This graph help us to know the occupation of the respondents, thi s is to know that which segment of people are buying more products on the intern et whether they are the segment of students o government employees or profession al , the above graph shows that the segment of the students i.e. 90% of the stud ents are using internet and use to buy online products. 48

Q5. TO KNOW THE MONTHLY INCOME OF THE REPONDENTS? MONTHLY INCOME 3 3 LESS THAN10000 10000-20000 20000-30000 94 30000-40000 40000ABOVE Figure 5.5 INTERPRETATION This above graph shows the percentage of monthly income of the di fferent respondents, and it show that less than 10000 income respondents have bu yed more online products because most of them are students and they use to buy m usic Cds, gadgets, laptops . 49

Q6 TO KNOW WHETHER RESPONDENTS HAVE THEIR OWN INTERNET CONNECTION? 35 DO YOU HAVE YOUR INTERNET CONNECTION 65 YES NO Figure 6.6 INTERPRETATION This graph show us the percentage of respondents who have their o wn internet connections, its shows that 65% of respondents have their own intern et connections and 35% people dont have their internet connection. 50

Q7 TO KNOW WHAT MOTIVATES PEOPLE TO DO ONLINE SHOPPING WHAT MOTIVATES YOU TO BUY ONLINE Column1, NO TRAVEL TO SHOP, 46, 47% 37 EASY PAYMENT NO HIDDEN COST WIDE RANGE OF PRODUCTS NO TRAVEL TO SHOP 5 10 Figure 7.7 INTERPRETATION This graph shows us what motivates the people to buy internet, as from above result we found out that no travel to shop is the main thing which m otivates the people to buy products online. 51

Q8 TO KNOW WHETHER CONSUMERS ARE GETTING COMPETITIVE PRICE Do you feel that the online marketers are providing competitive prices? 6 27 YES 67 NO CANT SAY Figure8.8 INTERPRETATION This diagram shows us that whether online marketers are giving co mpetitive price or not and result which is came is that most of the people thoug ht that online marketers are providing competitive prices than physical stores. And result shows 67% of people says that it provides competitive prices and only 27% people says no. 52

Q9 WHAT PRODUCTS DDO YOU BUY ONLINE? WHAT PRODUCTS YOU BUY ON INTERNET? 20 25 BOOKS MUSIC CD'S 23 20 12 T-SHIRTS MOBILE LAPTOP Figure 9.9 INTERPRETATION The above graphs gives result that most of time people use to buy books25% but the margin with other things is very less as music Cds have percen tage of 20 and mobile 23%So this graph shows us this useful data . 53

Q10 DO YOU FEEL THAT ONLINE SHOPPING IS BETTER THAN SHOPPING AT PHYSICAL STORE DO YOU FEEL THAT ONLINE SHOPPING IS BETTER THAN SHOPPING AT PHYSICAL BRICK AND M ORTAR STORE? 0 12 45 YES 38 NO CAN'T SAY Figure 10.1 After analyzing the above graph shows that the people are in favour of that onli ne shopping is better than physical store, The percentage of people who says onl ine shopping is better is 45% and the people who says it not good is 38 %. Still the percentage of people who says yes is more than other who says no. 54

Q11 WHICH OF THE FOLLOWING STORES HAVE YOU VISITED WHICH OF THE FOLLOWING STORES HAVE YOU VISITED ONLINE 10 4 35 e-BAY YAHOO SHOPPING 40 16 AMAZON BEST BUY OTHER Figure 11.1 INTERPRETATION This graph shows that 35% people use to visit e-bay for online sh opping,40% use to go at amazon.com because % of people who buys books is more th an any other products so people mostly visits amazon.com, 16 % people do at yaho o shopping and for other people use to visit at BestBuy and others. 55

WHAT FACTORS HELP YOU TO DECIDE WHICH SITE TO USE FOR ONLINE SHOPPING? WHAT FACTORS HELP YOU TO DECIDE WHICH SITE TO USE FOR ONLINE SHOPPING? 3 18 10 17 SEARCH ENGINE PERSONAL RECOMMENDATION SPECIAL OFFERS ON SITES 32 20 ONLINE ADVERTISING TV ADVERTISING OTHERS Figure 12.1 INTERPRETATION This diagram shows us what affects people to buy products on rnet and it shows that 32% people came to know about shopping sites through ne advertisements. And they attracted towards it and start getting products there. And 20% people decision is affected by special offers by the offers the discounts given by the sites. 56 inte onli from and

Q13 HOW YOU MAKE YOUR PAYMETS ON THE INTERNET HOW DO YOU MAKE YOUR PAYMENTS ON INTERNET ? 15 5 CREDIT CARD/DEBIT CARD BANK TRANFER 78 PAYPAL ANY OTHER 2 Figure 13.1 INTERPRETATION This diagram shows that mostly people uses credit card to pay the ir payments 78% people use to pay by credit/debit card and 5% through bank trans fer and 15% through pay pal and 2 from paypal. 57

Q14 HAVE YOU FACE ANY PROBLEMS WHILE SHOPPING ONLINE HAVE YOU FACE ANY PROBLEMS WHILE SHOPPING ONLINE 14 28 YES 48 NO Figure 14.4 This graph shows that whether people faces any problem while doing online shoppi ng or not and the result shows that 48% people says that they have faced problem while buying online and 28% people says that they dont face any problem and 14 s ays that we cant say 58

List of Tables Age 15-20 20-25 25-30 30 and above Fig 1 Gender Male Female Fig 2 Address Rural Urban Fig 3 Occupation Student Professional Govt.employee Self employed Others F ig 4 Income of respondents Respondents 76 24 No of respondents 31 48 14 0 % of r espondnts 31 48 14 7 Respondents 86 14 No of respondents 90 4 5 1 % of Respondents 59

LESS THAN 10000 10000-20000 20000-30000 30000-40000 40000ABOVE 94 3 3 Fig 5 Internet connection Yes No Fig 6 WHAT MOTIVATES YOU TO BUY ONLINE EASY PAYMENT NO HIDDEN COST WIDE RANGE OF PRODUCTS NO TRAVEL TO SHOP % respondents having internet connection 65 35 % of Respondents 37 5 10 46-47 Fig 7 Do you feel that the online marketers are providing competitive prices Yes No Cant,say Fig 8 What products you buy on internet Books Music t-shirts Mobile Laptop % respondents 67 27 6 % Respondents 24 25 12 23 20 60

Fig 9 Do you feel that online shopping is better than shopping at physical brick mortar store Yes No Cant ,say Fig 10 Which of the following stores have you vis ited online e-bay Yahoo shopping Amazon Best buy Others Fig 11 What factors help you to decide which site is use for online shopping Search engine Personal reco mdations Special offers on sites Online advertising TV advertising Others Fig 12 How do you make your payments online Credit card/debit card Bank transfer Pay p al Any other Fig 13 Have you face any problems while shopping online % Responden ts 45 38 12 % of Respondents 35 16 40 10 4 % of respondents 18 10 20 32 17 3 % of respondents 78 5 15 2 % of respondents 61

Yes No Cant ,say Fig 14 48 28 14 62

CHAPTER-5 Summary, conclusion, Limitations, Recommendations 63

Summary The three segments that were found show a significant difference in the primary factor of concern. The general distribution showed that the factor price was the primary factor for the entire population sample, and that second factor was tru st was closely followed by convenience. When we segmenting the respondents throu gh the different variables we found that segment one were mainly trust oriented and the respondents had a high positive attitude towards purchasing books online . Other segment was mainly price and convenience oriented therefore took the mos t consideration to the opinions and experiences of the Reference groups. As they low disposable income and were somewhat convenience oriented when acquiring inf ormation about low prices, we chose to label them price easers. We found that mo st of the time youngster who are from the age of 20-25 shops a lot on the net ra ther than other age limits. People used to do online shopping because of its con venience rather than its pricing, But the main thing which is very common in the most of the people about online shopping is its risk of privacy i.e. hacking of account number getting passwords and all. CONCLUSION Increased Internet penetration, a hassle free shopping environment and high leve ls of Net saviness see more and more Indians shopping online. But at the same ti me the companies need to reduce the risks related to consumer incompetence by ta ctics such as making purchase websites easier to navigate, and introducing Inter net kiosk, computers and other aids in stores. The goal is not to convert all sh oppers to online purchasing, but to show them its an option. In addition to above , efforts need to be taken to educate the online 64

buyers on the steps that need to be undertaken while making an online purchase. Moreover, the feedback of an online buyer should be captured to identify flaws i n service delivery. This can be done through online communities and blogs that s erve as advertising and marketing tools and a source of feedback for enterprises . I found that it is a challenge for E-marketers to convert low frequency online buyers into regular buyers through successful website design and by addressing concerns about reliable performance. Thus, the online retailing raises more issu es than the benefits it currently offers. The quality of products offered online and procedures for service delivery are yet to be standardized. Till the same i s done, the buyer is at a higher risk of frauds. Limitations of the Study Limitation of the study is the selection of the existing studies. Owing to time limitation, I only searched a few number of journals. This may leave some other prominent empirical studies out. In addition, owing to the multidisciplinary nat ure of online shopping, it would be very interesting to compare IS literature to other disciplines that study online shopping attitudes and behavior. Indian E-Comm. Report Finds Heavy Spenders Driving Sales By Devin Comiskey Augus t 16, 2007 A Survey by Indian research organization Juxtconsult found that more and more In dian Internet users are opening their wallets online. While such hurdles as limi ted broadband access and security concerns remain, the report finds there are cu rrently more than 10 million shoppers online in India. While current trends poin t to increased e-commerce growth in India, the online marketplace in the country of more than 1 billion people is still relatively small. Juxtconsult's survey f ound that 40 percent of all urban Internet users 65

buy online, while 42 percent of the sales originate through just five percent of consumers. The survey was conducted in April 2007 and sampled more than 30,000 users. "This section of buyers spends 5,000 rupees or more per month on the net, " states the report. "It is interesting to note that two out of every three heav y spenders are also 'netholics,' those who are on the net for more than three ho urs per day...Of all those who buy online, only 25 percent are spending more tha n 1,000 rupees per month while the (remaining) 75 percent bill less than 1,000 r upees per month." (1,000 Indian rupees is currently equal to approximately $23 U S.) The report also found that buying and search patterns among Indians differ b etween genders. "While 43 percent of male users buy online, only 31 percent of u rban female users are consumers as well. Women tend to search more. Defying thei r more common attitude towards shopping, women are more guarded when it comes to the online market," says Juxtconsult. "Depending on the product type, nine perc ent to 25 percent are buying online, whereas 33 to 47 percent are searching the net for product information," it says. Security Fears Persist Juxtconsult says the motivation for Indian users to make purchases online varies , but users fear compromised personal information is still a great risk when it comes to ecommerce. "The single biggest motivation for buying online for net use rs is saving time. Thirty-two percent of them look to shop online with this purp ose. Convenience of shopping '24x7' and home delivery are other major incentives ," says the report. "However, the concern of possible misuse of credit card or p ersonal information is extremely significant among online buyers, with almost 55 percent of them voicing their concern. Clearly, tackling and countering the iss ue of online safety figures as an imminent challenge for net marketers." Books, CDs Top the List 66

The products that are purchased most online in India, according to Juxtconsult, are books and CDs - making up 25 percent of all online purchases. "Ironically, c omputer hardware and software, despite having the home advantage are among one o f the least bought products online, with only 13 percent buying them," says the report. "In sum, the online market in India is blossoming but is yet to take off in a considerable way. The Internet is still being used more for searching than buying products and services. Though a noticeable proportion of net users are a lso net consumers, essentially, at present only a small tribe among them is driv ing online shopping momentum," says Juxtconsult. LATEST .A new trend in this space is that of Meta search engines. Ixigo and Ezeego are two players in this space. A Meta search engine searches all the online travel s ites (including the airlines sites as well) and displays the best deals for the user. Travel websites, such as Make My Trip India Pvt. Ltd and Yatra Online Pvt. Ltd, are battling to win over Indias Rs16,000 crores ($400 million) religious tr avel market Opportunity in Online Travel Industry: $2billion Online travel compa ny MakeMyTrip (MMT) has recorded sales of Rs. 1000 crore for the financial year ending March 2008, as per a release. Barriers to the Growth of the Market: Consumer Bias 67

Consumers often display a bias for brands that they know well and have had a goo d experience in the past. Thus products of brands with a favorable bias will sco re over the products of less popular brands. A few would risk buying expensive j ewelry from an unknown jeweler online. Lack of Touch Feel-Try Experience The customer is not sure of the quality of the product unless it is delivered to him and post-delivery of the product, it is sometimes a lengthy process to get a faulty or the unsuitable product changed. Thus, unless the deliverables are as per the customers expectations, it is hard to infuse more credibility in the e-T ailing market. Mounting Competitive Pressures To attract customers, the competing online players are adopting all means to pro vide products and services at the lowest prices. This has resulted in making the consumers choice-spoilt, who in turn surf various websites to spot the lowest p rice for the product. Thus, although the number of transactions is increasing, t he value of the products sold is continuously falling owning to high competition and leaner margins. Seasonality E-Commerce Market is faced by seasonal fluctuations. As told by an Industry play er, .August to February is the peak seasons for sale, while March to July is the dry seasons for sale.. During the peak season, occasions that drive the sales a re Diwali, Rakhi, Valentines Day, New Year, Christmas, Mothers Day, Friendship Day etc. are. On these occasions younger generations prefers buying and sending gif ts online. Credibility in Payment System 68

Online frauds and breach are the biggest barriers to online sales. As a result, prospective buyers prefer staying away from revealing their credit card and bank details. Untimely Delivery of Products It might take a few minutes to search, book and pay for products and services on line, but the delivery of the product may take unreasonable time. Recommendations As we came to know after researching on this topic we recommend that, the online sellers have to make their payment transparent, and as people are coming on the ir sites and they are buying their products , so retailers have to give more dis counts to their customers so that they can visit again and again to their site , and it also helps to make people more aware about the low rick shopping of the net, and one more thing is that there should be transaction of money is very slo w they have to make it fast so that customer dont have to face much problem to pa y for the product, if customer is going to face some problem he is not going to visit our site and buy product . Following implications should be followed Disco unt prices A transfer and reliable retailer Fast transactions Focus on customer satisfaction 69

CHAPTER-6 70

REFRENCES http://analogik.com/article_analysis_of_consumer_behaviour_online.asp [27april 2 010] http://www.essays.se/essay/e1fb0c636f/ [13april 2010] http://www.tealeaf.co m/Harris/[12april] http://inderscience.metapress.com/app/home/contribution.asp?r eferrer=parent&backto=is sue,2,6;journal,15,40;linkingpublicationresults,1:11084 4,1[11april 2010] http://www.inderscience.com/search/index.php?action=record&rec _id=32383&prevQuer y=&ps=10&m=or1m[12 may 2010] (International Journal of Busine ss Innovation and Research 2010 - Vol. 4, No.3 pp. 195 209) http://www.lotsofess ays.com/viewpaper/1693412.html [11april 2010] http://www.inderscience.com/search /index.php?mainAction=search&action=record&rec_ id=11032&prevQuery=&ps=10&m=or[2 2april [11april 2010] ( International Journal of Electronic Marketing and Retail ing 2006 - Vol. 1, No.2 pp. 169 - 182) http://www.inderscience.com/search/index. php?mainAction=search&action=record&rec_ id=11032&prevQuery=&ps=10&m=or[2 may 20 10] (International Journal of Electronic Marketing and Retailing 2006 - Vol. 1, No.2 pp. 169 - 182) 71

http://www.inderscience.com/search/index.php?mainAction=search&action=record&rec _ id=10096&prevQuery=&ps=10&m=or [8 may 2010] (International Journal of Electron ic Marketing and Retailing 2006 - Vol. 1, No.1 pp. 67 82) .http://www.inderscience.com/search/index.php?mainAction=search&action=record&re c _id=19151&prevQuery=&ps=10&m=or (International Journal of Internet Marketing and Advertising 2008 - Vol. 4, No.4 pp. 302 - 327) [1 may 2010] http://www.indersci ence.com/search/index.php?mainAction=search&action=record&rec_ id=27851&prevQuer y=&ps=10&m=or [2 may 2010] (International Journal of Electronic Finance 2009 - V ol. 3, No.3 pp. 284 - 296) .http://www.inderscience.com/search/index.php?mainAct ion=search&action=record&rec _id=14847&prevQuery=&ps=10&m=or [ 16 april2010] (In ternational Journal of Electronic Marketing and Retailing 2007 - Vol. 1, No.4 pp . 322 - 338) http://www.cyberpsychology.eu/view.php?cisloclanku=2009111002&artic le=6#authors[2 2 may 2010] http://www.innovations-report.com/html/reports/social _sciences/report-54694.html 22april 2010] 72

CHAPTER-7 APPENDIX 73

APPENDIX It is humbly submitted that we are doing research project on the topic entitled Consumer Behaviour In Online shopping . In this regards your kind cooperation is needed in filling the questionnaire herewith. Further, I assure you that all th e information provided by you would be kept strictly confidential and will be us ed for academic purpose only. Thanks With regards NAME Prashant Priyadarshi Nitish Arora Nandni Kashyap BBA 4t h SEM Specialization: Marketing ROLL.NO Q1808A17 Q1808A15 Q1808A58 74

QUESTIONNAIRE 1. Name ___________________ 2. Age 1) 15-20 Q3. Gender 1) Male Q4. Address 1) Ru ral 2) Urban 2) Female 2) 20-25 3) 25-30 4) 30 above Q5. What is your occupation? a) Student e) Other Q6. What is your monthly income ? a) Less than 10000 d) 30000 to 40000 b) 10000 to 20000 e) More than 40000 c) 2 0000 to 30000 b) Professional c) Govt.employed d) Self Employed Q7. Do you have your own internet connection? a) Yes b) No Q8. How frequently do you purchase online? 75

a) Once a week b) More than once a week d) more than once in a month Q9. What mo tivates to buy products online? a) Easy payment d) Wide range of products b) No hidden cost c) once a month c) No travel to shop e) other [Please specify] ____________ Q10.Do you feel that the online marketers are providing competitive prices? a) Y es b) No c) Cant Say 1 2 3 4 5 Strongly agree 1.It saves your time 2.It does not require travelling to far off distance 3.Anywhere any time shopping 4.It takes a long time to deliver products 5.It takes more time to search specific product 6.Speed of internet affects you r online shopping 7.It gives me ease of shopping at home 8.Shopping 24x7 9.Ease to make payment assistance 10.I get better discounts & offers on internet 11.I d o not think that online shopping results in monetary benefits Agree Cant say Disagree Strongly Disagree 12.I can customize the products according to my specification 13. I cannot negot iate prices on internet. 76

14. I can shop from stores located at any part of the world. 15.I have access to Global brands 16. Lack of physical evidence affects my purchase decision. 17.Wi de choices of brands to choose 18. The actual products do no match the products shown on site. 19.I do not get much variety in products 20.I feel difficulty to choose a product because of intangibility Q11. What products you buy on internet? a) Books e) laptop f) Other [specify] __ _________ Q12. Do you feel that online shopping is better than shopping at physi cal brick & mortar store? a) Yes b) No c) Cant say b) Music CDs c) T-shirt d) Mob ile Q13.Which of the following stores have you ever visited for shopping online? a) e-bay b) Yahoo shopping e) Other [please specify] c) Amazon d) Best buy Q14. What factors help you to decide which site to use for online shopping? a) S earch engine d) Online advertising b) Personal recommendation e) TV advertising c) Special offers on sites f) other_________ Q15.How do you make your payments on internet? a) Credit card/Debit card other__ ____ b) Bank transfer c) PayPal d) any 77

Q16. Have you face any problems while shopping online? a) Yes b) No c) Specify _ ________________________ 78