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CHAPTER I INTRODUCTION AND DESIGN OF THE STUDY

1.1 INTRODUCTION The invention of the Internet has created a paradigm shift of the traditional way people shop. A consumer is no longer bound to opening times or specific locations; he can become active at virtually any time and place and purchase products or services. The Internet is a relatively new medium for communication and information exchange that has become present in our ever yday life. The number of Internet users is constantly increasing which also signifies that online purchasing is increasing (Joines, Scherer & Scheufele, 2003). The rapid increase is explained by the growth in the use of broadband technology combined with a change in consumer behaviour (Oppenheim & Ward, 2006). The Internet is considered a mass medium that provides the consumer with purchase characteristics as no other medium. Certain characteristics are making it more convenient for the consumer, compared to the traditional way of shopping, such as the ability to at any time view and purchase products, visualise their needs with products, and discuss products with other consumers (Joines et al. 2003). Oppenheim and Ward (2006) explain that the current primary reason people shop over the Internet is the convenience. They also recognize that the previous primary reason for shopping online was price, which has now changed to convenience. Online shopping is the process consumers go through when they decide to shop on the Internet. The Internet has developed into a new distribution channel (Hollensen, 2004) and the evolution of this channel, ecommerce, has been identified by Smith and Rupp (2003) to be the most
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significant contribution of the information revolution. Using the Internet to shop online has become one of the primary reasons to use the Internet, combined with searching for products and finding information about them (Joines et al. , 2003). Smith and Rupp (2003) also state that the consumers have never had access to so many suppliers and product/service opinions. Therefore, the Internet has developed to a highly competitive market, where the competition over the consumer is fierce. In order to have an impact on and retain consumers, in a competitive market, Constantinides (2004) stated that the first step is to identify certain influencing aspects when purchasing online, these can be regarded as factors. 1.2 TITLE OF THE PROBLEM The title of the research study is A study on consumer attitude towards Online-shopping with special reference to Erode City. It has been more than a decade since business-to-consumer Ecommerce first evolved. Scholars and practitioners of electronic commerce constantly strive to gain an improved insight into consumer behaviour in cyberspace. Along with the development of E-retailing, researchers continue to explain E-consumers behaviour from different perspectives. Many of their studies have posited new emergent factors or assumptions which are based on the traditional models of consumer behaviour, and then examine their validity in the Internet context. Butler and, however, explained the failure of IBMs sponsored web shopping malls by the naive assumption of the true nature of online consumer behaviour. A critical understanding of consumer behaviour in the virtual environment, as in the physical world, cannot be accomplished if the factors affecting the purchase decision are ignored or misunderstood. For instance, online consumers concerns about lack of opportunity to examine products prior to purchase are regarded as the
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specific factor affecting the online buying decision. Therefore, several researchers proposed that consumers shopping behaviour in online shops may be fundamentally different from that in the traditional environment. More frequent online buyers are expected to use online shopping more frequently as it enhances their trust in the respective website than for less frequent online buyers. Clearly, electronic markets have some unique economic characteristics. If E-marketers intend to ignore the fundamental truths about consumer behaviour due to this point, most of the promises of E-marketing in the business-to-consumer context will not be fulfilled. 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, communicate and disseminate information, to sell the product, to take feedback and also to conduct satisfaction surveys with 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 receive if they purchase the product from a particular store. Many experts are optimistic about the prospect of online business. Forrester Research predicted that the amount of E-commerce activities worldwide will reach US$6.8 trillion by 2004, from US$43 billion in 1998. During 2001, 497.7 million Internet users worldwide generated US$615.3 billion in revenue from E-commerce transactions. In addition to the tremendous potential of the E-commerce market, the Internet provides a unique opportunity for companies to more efficiently reach existing and potential customers.

1.3 STATEMENT OF THE PROBLEM At any given time there are millions of people online and each of them is a potential customer for a company providing online sales. Due to the rapid development of the technologies surrounding the Internet, a company that is interested in selling products from its web site will constantly have to search for an edge in the fierce competition. Since there are so many potential consumers, it is of the out most importance to be able to understand what the consumer wants and needs. The importance of analysing and identifying factors that influence the consumer when he or she decides to purchase on the Internet is vital. Since the Internet is a new medium for there have been new demands set by the consumer. That is why it is crucial for the online retailers to know what influences the online consumer. Analysing consumer behaviour is not a new phenomenon. The renowned marketing expert Philip Kotler has published several works on the topic of consumer behaviour theories. These theories have been used for many years not only to understand the consumer, but also create a marketing strategy that will attract the consumer efficiently. Hence, understanding and identifying the consumer 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 made when considering traditional consumer behaviour and online consumer behaviour. Since online retailing is a new retailing medium and online consumer behaviour is diverse from traditional consumer behaviour, one must identify what influences the online consumer. Analysing the process that the online
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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. To further understand how these factors influence different types of consumers, we must identify segments which will comparisons. 1.4 REVIEW OF LITERATURE The current literature on consumer online purchasing decisions has mainly concentrated on identifying the factors which affect the willingness of consumers to engage in Internet shopping. In the domain of consumer behaviour research, there are general models of buying behaviour that depict the process which consumers use in making a purchase decision. These models are very important to marketers as they have the ability to explain and predict consumers purchase behaviour. The classic consumer purchasing decision-making theory can be characterized as a continuum extending from routine problem-solving behaviours, through to limited problem-solving behaviours and then towards extensive problem-solving behaviours [Schiffman et al., 2001]. The traditional framework for analysis of the buyer decision process is a five-step model. Given the model, the consumer progresses firstly from a state of felt deprivation (problem recognition), to the search for information on problem solutions. The information gathered provides the basis for the evaluation of alternatives. The development and comparison of purchasing evaluation criteria result in the actual decision to buy. Finally, post-purchase behaviour is critical in the marketing perspective, as it eventually affects consumers
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enable us to make

perception of satisfaction/dissatisfaction with the product/service. This classic five stage model comprises the essence of consumer behaviour under most contexts. Nevertheless, the management of marketing issues at each stage in the virtual environment has to be resolved by individual Emarketers. Peterson et al. [1997] commented that it is an early stage in Internet development in terms of building an appropriate dedicated model of consumer buying behaviour. Decision sequences will be influenced by the starting point of the consumer, the relevant market structures and the characteristics of the product in question. Consumers' attitude towards online shopping is a prominent factor affecting actual buying behaviour. Jarvenpaa and Todd [1997] proposed a model of attitudes and shopping intention towards Internet shopping in general. The model included several indicators, belonging to four major categories; the value of the product, the shopping experience, the quality of service offered by the website and the risk perceptions of Internet retail shopping. In the research conducted by Vellido et al. [2000], nine factors associated with users' perception of online shopping were extracted. Among those factors the risk perception of users was demonstrated to be the main discriminator between people buying online and people not buying online. Other discriminating factors were; control over, and convenience of, the shopping process, affordability of merchandise, customer service and ease of use of the shopping site. In another study, Jarvenpaa et al. [2000] tested a model of consumer attitude towards specific web-base stores, in which perceptions of the store's reputation and size were assumed to affect consumer trust of the retailer. The level of trust was positively related to the attitude toward the store, and inversely related to the perception of the risks involved in buying from that store. Jarvenpaa et al. [2000] concluded that the

attitude and the risk perception affected the consumer's intention to buy from the store. Consumers perceived risks associated with online shopping have a critical effect on their decision making. Risk perception refers to the trustors belief about likelihoods of gains and losses outside of considerations that involve the relationships with the particular trustee [Mayer et al., 1995, p.726]. Although some early research suggests that risk perception may play a minor role in the adoption of online shopping [Jarvenpaa and Todd, 1997], recent results from several studies have identified that consumers risk perception is a primary obstacle to the future growth of online commerce [Culnan, 1999]. Consumer risk perceptions and concerns regarding online shopping are mainly related to aspects involving the privacy and security of personal information, the security of online transaction systems and the uncertainty of product quality. Trust is interwoven with risk [McAllister, 1995]. One of the consequences of trust is that it reduces the consumers perception of risk associated with opportunistic behaviour by the seller [Ganesan, 1994]. Lack of trust is frequently reported as the reason for consumers not purchasing from Internet shops, as trust is regarded as an important factor under conditions of uncertainty and risk in traditional theories. Kim and Benbasat [2003] identified four categories of trust related issues: personal information, product quality and price, customer service, and store presence (p.49). As a new form of commercial activity, Internet shopping involves more uncertainty and risk than traditional shopping. In the virtual environment, a consumer cannot physically check the quality of a product before making a purchase, or monitor the safety and security of sending

sensitive personal and financial information; e.g., credit card details; through the Internet to a party whose behaviours and motives may be hard to predict. Mayer et al. [1995] developed a model which combines traditional marketing philosophy on consumer motivation to buy and the trust model. In this model, trust propensity; which is a personality trait possessed by buyers; is an important antecedent of trust. In Internet shopping, there is not much information available to the buyer regarding the seller, prior to purchase. A buyer with a high propensity to trust will more likely be a potential customer than a buyer with a lower propensity. Mayer et al. [1995] proposed that ability, benevolence and integrity constitute the main elements of trustworthiness. Ability refers to skills, competencies and characteristics that a seller has in a specific domain. In this context, sellers need to convince buyers of the competence of their companies in the Internet shopping business. Benevolence is the extent to which the seller is perceived by the buyer as wanting to do good. Sellers have to convince buyers that they genuinely want to do good things for buyers, rather than just maximize profit. Integrity refers to the buyers perception that the seller adheres to a set of principles which the buyer finds acceptable. A high level of trust by buyers has been found to stimulate favourable attitudes and behaviour [Schurr and Ozanne, 1985; Anderson and Narus, 1990]. A consumers trust in an Internet store can be thought as the consumers trust directly in the store. Nevertheless, Hoffman et al. [1999] argued that the effectiveness of third-party trust, certification bodies and the public key encryption infrastructure for ensuring financial security, are the central success factors for building consumer trust in Internet shopping. Kini and Choobineh [1998] suggested that trust in the Internet business is

necessary, but not sufficient, for an Internet buying behaviour to take place. The consumer must also trust the transaction medium for online shopping. In addition to the impact of trust and perceived risks associated with online shopping, enjoyment of the online shopping experience is also an important determinant of retaining online shoppers [Rice, 1997]. Many online purchasers said that they would not shop on a particular website next time if they had an unpleasant experience with it. On the web, shopping enjoyment is positively and significantly related both to attitudes and intentions toward shopping on the web [Eighmey, 1997]. Online shopping is, however, a different experience from shopping in a physical retail store. One major point of difference deals with store atmospherics [Engel et al., 1990]. This term describes the physical aspects of a store; such as colours, music type, music volume and tempo and layout of products. Store atmospherics have a direct effect on customer mood and behaviour [East, 1997]. Web stores so far cannot fully simulate the ambiance of a physical store on account of the limitations of devices. So, the system design of the E-retailing experience must compensate for the loss of traditional in-store ambiance. The impact of perceived ease of using the website and of transactional control, vary with the type of task the consumer is undertaking. Li et al. [1999] examined the effects of three perceived channel utilities; communication, distribution and accessibility; and four types of consumer shopping orientations; recreational, experiential, convenience and economic. Their results showed that online buying behaviour was affected by a mix of consumer shopping orientation and perceived channel utilities. Hoffman and Novak [1996] proposed that two broad categories of behaviour in which consumers engage during the phase of pre-purchase on the Internet are goaldirected and experiential behaviour. They also indicated that the flow
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experience is a crucial antecedent of online purchase behaviour. When shoppers are in the flow state, irrelevant thoughts and perceptions are screened out and they are immersed in the interaction with the websites. As flow experience occurs during network navigation, an issue E-marketers must consider is whether consumers skills are competent to meet the challenges of the virtual environment. In Novak et al. [1999]s research it was found that skill, challenge and focused attention are significant antecedents of flow, and playfulness is regarded as an important indicator of flow. The optimal stimulation level theory may be applicable to achieve the perception of playfulness. Zuckerman [1979] defined the optimal stimulation level in that an intermediate level of stimulation obtained from the environment corresponds to the most favourable affective reaction [1979, p.37]. The adoption of this theory can result in the perception of ease of use and a positive attitude toward the website, as well as an actual purchase. On the other hand, the potential for information overload arising from the free flow of product information increases consumers sense of uncertainty, which causes the search activity to become psychologically costly [Wilkie, 1994]. Therefore, the best-designed information package will generate a competitive advantage. Information technology provides online consumers with tremendous access to information about products and services from anywhere in the world and from different sources other than solely from the product seller. The combination of less time available for shopping, limited informationprocessing capability and the explosive amount of information on the web has, however, led customers to demand more control, less effort and greater efficiency during shopping [Jarvenpaa and Todd, 1997]. In order to respond to the customers desire for control and convenience, web stores have to design an efficient system to enable consumers to easily find what they need,
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learn more about it and quickly make a purchase decision [Baty and Lee, 1995]. Design characteristics of a web page were found to affect consumers online buying decision. Ho and Wu [1999] found that homepage presentation is a major antecedent of customer satisfaction. The other antecedents; such as logical support, technological characteristics, information characteristics and product characteristics; are also predictive factors to satisfaction. By using a sample of 214 online shoppers, Ranganathan and Ganapathy [2002] found four key dimensions of B2C web sites; information content, design, security and privacy. They concluded that, though all these dimensions have an impact on the purchase intention, security and privacy were found to have greater impact on the purchase intent of online buyers. Dholakia and Rego [1998] investigated the factors which make commercial web pages popular. They found that a high daily hit-rate is strongly influenced by the number of updates made to the website in the preceding three month period. The number of links to other websites was also found to attract visitor traffic. Lohse and Spiller [1998] used a regression model to predict store traffic and sales revenues, as a function of interface design features and store navigation features. The findings indicated that including additional products in the store and adding a FAQ section attracted more traffic. Providing a feedback section for customers will lead to higher sales. Finally, they found that improved product lists significantly affected sales. Lohse et al. [2000] used panel data to explore the predictors of online purchasing behaviour. They found that the typical online consumers are characterized by their wired lifestyle, and are time starved. Therefore, they suggested providing customized information for the online shoppers who
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buy standard or repeat items, which can lead to shoppers gaining a feeling of increased convenience, and allow them to make quick purchase decisions. In Koufaris et al. [2002]s research, it was proposed that two types of information; non-value-added and value-added; should be used by search mechanisms in web-based stores. Jarvenpaa and Todd [1997] also found that the existence of value-added information at a commercial website can be an important incentive for people to shop online, and provides a key source of diversity. Finally, they suggested that specific information available to support consumer search, and multiple search, mechanisms with a positive challenge will increase shopping enjoyment. The explosive growth in usage of the Internet provides a great number of potential consumers to E-marketers. Whether or not marketers can convert their potential customers into real ones and retain them depends, to a very large extent, on the service they offer and on the perceived customer satisfaction of consumers [Churchill and Surprenant, 1982; Oliver, 1980; Luarn and Lin, 2003]. The concept of customer satisfaction occupies a central position in marketing theory and practice [Churchill and Surprenant, 1982]. Satisfaction is important to the individual consumer because it reflects a positive outcome from the outlay of scarce resources, and/or the fulfilment of previously unmet needs [Bearden and Teel, 1983]. From the perspective of antecedents and the consequences of satisfaction, Oliver [1980] proposed a model that expresses consumer satisfaction as a function of expectation and expectancy disconfirmation. Moreover, satisfaction significantly affected customers attitudes and their intention to purchase. Many researchers have found the quality of web retailing sites is a dominant antecedent of customer satisfaction within the online shopping environment. Assuming web design as an important issue in web shopping, Wolfinbarger and Gilly [2002] developed a four-dimensional scale; .comQ; that included
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website design, reliability/fulfilment, customer service and privacy/security to measure the quality of an online retailing site. They found that website design quality was an important issue in customer satisfaction. This scale was tested and validated, and they recommended its use in any further study dealing with the measurement of online quality. This review of empirical studies has embodied different factors which influence online purchasers behavior. The antecedents of online purchase include many attitudinal components; for example, attitude towards a website and perceived risk of an online purchase. Consumers online shopping experiences, website design and fulfillment of quality expectations are deemed as the major components to successful online transactions. The review also presented the fact that good customer service led to customer satisfaction, which in turn resulted in consumer loyalty to such websites. Many researchers have also conducted studies to measure how online consumers perceived web shop quality. The review of studies on quality measurement showed that the four-dimensional online quality scale; .comQ; developed by Wolfinbarger and Gilly [2002], could be adopted as it has already been tested and validated. Therefore, it has been adopted in this research as the main measurement system, with an addition of three more items to adapt its parameters to the current research objectives.

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1.5 OBJECTIVES OF THE STUDY What main factors affect the online consumer when considering and making a purchase over the Internet? How do these factors influence the consumer when purchasing books online? What kind of segments can be found within the identified consumers when purchasing books online?
What is the connection with the identified factors and consumer

segment groups? 1.6 SCOPE OF THE STUDY The scope of this research is primarily to identify and get insight into what main factors the online consumer takes into consideration when purchasing books online, as books are the most commonly bought product on the Internet. Further, we will investigate if any segments can be established by identifying the consumers and how these segments relate to the identified factors. The findings of this research will be outlined as implications for online book retailers in order to enhance their consumer knowledge and increase their online marketing strategy effectiveness. 1.7 OPERATIONAL DEFINITIONS There are a number of factors influencing the online consumer. However, this research will try to identify the main factors influencing the online consumer and will, therefore, try to limit these to a few in order to be able to investigate the effect on the online consumer. Within the field of consumer behaviour there are many theories and models that identify the consumer. This research will limit itself to identifying the consumer through his/her consumer characteristics and the consumer buying process.\
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1.8 LIMITATION OF THE STUDY


1. Total coverage of the study is limited to the few customers for shopping

online at Erode.
2. Sample size of the study is restricted to 100 customers only. 3. Most of the respondents are uncertain to give information but however

an attempt is made to collect the data systematically.


4. Time is the one constraint of the survey

1.9 CHAPTER DESIGN The study is divided into five chapters of which the present introduction chapter deals with introduction about the study, consumer attitude, statement of the problem, relevant review of literature, objective, scope and limitations of the study. Chapter two deals on research methodology of the study. Third chapter describes profile of the study and area. Chapter four makes a detailed analysis and interpretation on collected data. At last findings, suggestions and conclusion is given in fifth chapter.

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CHAPTER II RESEARCH METHODOLOGY


2.1 INTRODUCTION Research is common parlance refers to a search for knowledge. The advance learners dictionary of current English lays down the meaning of research as a Careful Investigation or Inquiry specially though search for new facts in any branch of knowledge. Research methodology is a way to systematically solving the research problem which may be understood as a science of how research is done scientifically. We study the various steps that are generally adopted by a research in studying his research problem along with the logic behind them. 2.2 METHODOLOGY A Research design is arrangement of conditions for collection and analysis of data in a manner that aims to combine relevant to the research purpose with economy in procedure. Descriptive research design is used in this project study. Descriptive research design Descriptive research includes surveys and fact- finding enquiries of different kinds. The main characteristic of this method is that the researcher has no control over the variables. It can be only reporting what happened or what is happening.

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Area of the study The area of study refers to Erode District, due to availability of people at all levels of educational and finance status. It is also easy to collect the needed relevant primary data from the employees. Period of the study The present study period was two months for collecting primary data from the employees and secondary data collected by the online shopping customer.
a. Collection of data

The data is collected for the study by using both primary and secondary data. 1. Primary Data Primary data for our research was collected through questionnaires. When collecting primary data one can choose to do interviews, observations, experiments, and questionnaires. Due to the purpose of our research, only the questionnaire method would be able to approach the topic and be able to collect the answers in a satisfactory manner. In our research the primary data is mainly concerned with analyzing the respondent in order to later on classify the respondent. Further on, the primary data will be used to analyze the factors and how these are related to the respondent. The primary data is conducted in a manner to be able to approach our research and solve our research questions. The questionnaire will be explained in more detail in chapter 5, the Empirical methodology.

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2. Secondary Data A secondary data is collected from the books, periodical journals, magazines, papers, company records, internet and other publication. b. Sampling design A sampling design is a definite plan for obtaining a sample from a given population. It refers to the techniques or the procedure that researcher would adopt in selection items for the sample. Simple random sampling is used in this project study. Simple random sampling is where each and every item in this population has an equal chance of inclusion in the sample and each one of the possible samples in case of finite universe which has the same probability of being selected. c. Tools used The data collected were analysis using tests like simple percentage method, Mean score method and Chi-square analysis. I. Simple percentage method Percentage = Number of respondents x 100 Total respondents II. Mean score method: Mean score = Total score x 100 Maximum score III. Chi-square test It is applied in statistics to test the significance of association between two attributes.
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The procedures followed are 1. Formulate the null hypothesis 2. Fix the level of significance 3. Calculate the test statistic 2 =

(O-E)2 E = (R-1) (C-1)

Degrees of freedom Where O E R C = = = =

Observed frequency Expected frequency No. of rows No. of columns

The expected frequency is calculated by using the following formula E = Row Total x Column Total Grand Total If the calculated value is equal or greater than the table value, the null hypothesis is rejected. But if the calculated value is less than the table value, the null hypothesis is accepted. Hypothesis : 1. Null hypothesis: There is no significant relationship between age and opinion level regarding safety and measures. 2. Null hypothesis: There is no significant relationship between experience and opinion level regarding safety welfare measures.

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CHAPTER III PROFILE OF THE STUDY


3.1 INTRODUCTION 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. An online shop, eshop, e-store, Internet shop, webshop, webstore, online store, or virtual store evokes the physical analogy of buying products or services at a bricks-and-mortar retailer or shopping centre. The process is called business-to-consumer (B2C) online shopping. When a business buys from another business it is called business-to-business (B2B) online shopping. 3.2 HISTORY In 1990 Tim Berners-Lee created the first World Wide Web server and browser. It opened for commercial use in 1991 . In 1994 other advances took place, such as online banking and the opening of an online pizza shop by Pizza Hut. During that same year, Netscape introduced SSL encryption of data transferred online, which has become essential for secure online shopping. Also in 1994 the German company Intershop introduced its first online shopping system. In 1995 Amazon launched its online shopping site, and in 1996 eBay appeared. 3.3 CUSTOMERS Online customers must have access to a computer and a method of payment. In general, higher levels of education, income, and occupation of the head of the household correspond to more favorable perceptions of non-store shopping. Also, increased exposure to technology increases the probability of developing favorable attitudes towards new shopping channels.

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In a December 2011 study Equation Research found that 87% of tablet users made an online transaction with their tablet device during the early holiday shopping season. 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 web site 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 cr card numbers are not accepted by e-mail, for security reasons). Payment Online shoppers commonly use a cr card to make payments, however some systems enable users to create accounts and pay by alternative means, such as:

Billing to mobile phones and landlines Cash on delivery (C.O.D., offered by very few online stores) Cheque/ Check Debit card

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Direct debit in some countries Electronic money of various types Gift cards Postal money order Wire transfer/delivery on payment Some sites will not accept international cr cards, some require both the

purchaser's billing address and shipping address to be in the same country in which site does its business, and still other sites allow customers from anywhere to send gifts anywhere. The financial part of a transaction might be processed in real time (for example, letting the consumer know their cr card was declined before they log off), or might be done later as part of the fulfillment process. Product delivery Once a payment has been accepted the goods or services can be delivered in the following ways.

Downloading: This is 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 ships the item directly to the consumer, bypassing the retailer's physical location to save time, money, and space. In-store pickup: The customer orders online, finds a local store using locator software and picks the product up at the closest store. This is the method often used in the bricks and clicks business model. Printing out, provision of a code for, or emailing 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 eligility (e.g., assurances that the right of admission or use is
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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 the customer's address or that of a customer-designated third party. Will call, COBO (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 offline administration of products and categories. The shop is then generated as HTML files and graphics that can be uploaded to a webspace. These systems do not use an online database. A high end solution can be bought or rented as a standalone program or as an addition to an enterprise resource planning program. It is usually installed on the company's own 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 at the same time. Open source shopping cart packages include advanced platforms such as Interchange, and off the shelf solutions as Avactis, Satchmo, osCommerce, Magento, Zen Cart, VirtueMart, Batavi and PrestaShop. Commercial systems can also be tailored to one's needs so the shop does not have to be created from scratch. By using a pre-existing

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framework, software modules for various functionalities required by a web shop can be adapted and combined.

Online shopping Like many online auction websites, many websites allow small businesses to create and maintain online shops (ecommerce online shopping carts), without the complexity that involved in purchasing and developing an expensive stand alone ecommerce software solutions. Design Customers are attracted to online shopping not only because of the high level of convenience, but also because of the broader selection, competitive pricing, and greater access to information. Business organizations seek to offer online shopping because it is much lower cost compared to bricks and mortar stores, offers access to a world wide market, increases customer value and builds sustainable capabilities. Information load Designers of online shops are concerned with the effects of information load - whether consumers can be given too much information in virtual shopping environments. Information load is a product of the spatial and temporal arrangements of stimuli in the webstore. Compared with conventional retail shopping, the information environment of virtual shopping is enhanced by providing additional product information such as comparative products and services as well as various alternatives and attributes of each alternative, etc. 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
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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 webstore is not just a good looking website with dynamic technical features, listed in many search engines. In addition to disseminating information, it is about building relationships and making money. Businesses often attempt to adopt online shopping techniques without understanding them and/or without a sound business model, producing webstores that support the organizations' culture and brand name without satisfying consumer's expectations. User-centered design is critical. Understanding the customer's wants and needs and living up to promises gives the customer a reason to come back and meeting their expectations gives them a reason to stay. It is important that the website communicates to the customer that the company cares about them. Customer needs and expectations are not the same for all customers. Age, gender, experience, 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. 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 webstore. It is easier to lose a customer then to gain one and even "top-rated"

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sites will not succeed if the organization fails to practice common etiquette such as returning e-mails in a timely fashion, notifying customers of problems, being honest, and being good stewards of the customers' data. Because it is important to eliminate mistakes and be more appealing to online shoppers, many webshop 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 site are ease of use and the presence of user-friendly features. 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. Market share E-commerce B2C product sales totaled $142.5 billion, representing about 8% of retail product sales in the United States. The $26 billion worth of clothes sold online represented about 13% of the domestic market, and with 72% of women looking online for apparel, it has become one of the most popular cross-shopping categories. Forrester Research estimates that the United States online retail industry will be worth $279 billion in 2015. 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. Advantages

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a. 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 access as well. A visit to a conventional retail store requires travel and must take place during business hours. In the event of a problem with the itemit is not what the consumer ordered, or it is not what they expectedconsumers are concerned with the ease with which they can return an item for the correct one or for 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). b. 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.

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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 now blogs gives customers the option of shopping cheaper org anise 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-mail or phone calls to handle customer questions. c. Price and selection One advantage of shopping online is being able to quickly seek out deals for items or services with 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.. Disadvantages a. Fraud and security concerns
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Given the lack of ability to inspect merchandise before purchase, consumers are at higher risk of fraud on the part of the merchant than in a physical store. Merchants also risk fraudulent purchases using stolen cr cards or fraudulent repudiation of the online purchase. With a warehouse instead of a retail storefront, merchants face less risk from physical theft. Secure Sockets Layer (SSL) encryption has generally solved the problem of cr card numbers being intercepted in transit between the consumer and the merchant. Identity theft is still a concern for consumers when hackers break into a merchant's web site and steal names, addresses and cr card numbers. 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 the online shoppers; 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 trust mark or 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 cr card information. If it does the address on the cr 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 you purchase a product, you are going to be required to put in your cr card information and billing/shipping address. If the website is not secure a customers information can be accessible to anyone who
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knows how to obtain it. Most large online corporations are inventing new ways to make fraud more difficult, however, the criminals are constantly responding to these developments with new ways to manipulate the system. Even though these efforts are making it easier to protect yourself online, it is a constant fight to maintain the lead. It is advisable to be aware of the most current technology and scams out there to fully protect yourself and your finances.20. One of the hardest areas to deal with in online shopping is the delivery of the products. Most companies offer shipping insurance in case the product is lost or damaged; however, if the buyer opts not to purchase insurance on their products, they are generally out of luck. Some shipping companies will offer refunds or compensation for the damage, but it is up to their discretion if this will happen. It is important to realize that once the product leaves the hands of the seller, they have no responsibility (provided the product is what the buyer ordered and is in the specified condition).. c. Lack of full cost disclosure The lack of full disclosure with regards to the total cost of purchase is one of the concerns of online shopping. 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 as 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. d. Privacy

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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 not to use consumer information for these purposes, or provide a mechanism to opt-out of such contacts. Many websites keep track of consumers shopping habits in order to suggest items and other websites to view. Brick-and-mortar stores also collect consumer information. Some ask for address and phone number at checkout, though consumers may refuse to provide it. Many larger stores use the address information encoded on consumers' cr 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. e. 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 these reviews can be sometimes subjective and based on personal preferences that may not reflect end-user satisfaction once the item has been received. f. Product suitability

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Many successful purely virtual companies deal with digital products, (including information storage, retrieval, and modification), music, movies, office supplies, education, communication, software, photography, and financial transactions. Other successful marketers use Drop shipping or affiliate marketing techniques to facilitate transactions of tangible goods without maintaining real inventory. Some non-digital products have been more successful than others for online stores. Profitable items often have a high value-to-weight ratio, they may involve embarrassing purchases, they may typically go to people in remote locations, and they may have shut-ins as their typical purchasers. Items which can fit in a standard mailboxsuch as music CDs, DVDs and booksare particularly suitable for a virtual marketer. Products such as spare parts, both for consumer items like washing machines and for industrial equipment like centrifugal pumps, also seem good candidates for selling online. Retailers often need to order spare parts specially, since they typically do not stock them at consumer outletsin such cases, e-commerce solutions in spares do not compete with retail stores, only with other ordering systems. A factor for success in this niche can consist of providing customers with exact, reliable information about which part number their particular version of a product needs, for example by providing parts lists keyed by serial number. Products less suitable for e-commerce include products that have a low value-to-weight ratio, products that have a smell, taste, or touch component, products that need trial fittingsmost notably clothingand products where colour integrity appears important. Nonetheless, Tesco.com has had success delivering groceries in the UK, albeit that many of its goods
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are of a generic quality, and clothing sold through the internet is big business in the U.S. g. Aggregation High-volume websites, such as Yahoo!, Amazon.com and eBay, offer hosting services for online stores to all size retailers. These stores are presented within an integrated navigation framework. Collections of online stores are sometimes known as virtual shopping malls or online marketplaces. Impact of reviews on consumer behaviour One of the great benefits of online shopping is the ability to read others' reviews, which could be from experts or simply fellow shoppers on one product and service. The Nielsen Company conducted a survey in March 2010 and polled more than 27,000 Internet users in 55 markets from the Asia-Pacific, Europe, Middle East, North America and South America to look at questions such as "How do consumers shop online?", "What do they intend to buy?", "How do they use various online shopping web pages?", and the impact of social media and other factors that come into play when consumers are trying to decide how to spend their money on which product or service. According to that research, reviews on electronics (57%) such as DVD players, cell phones or PlayStations and so on, reviews on cars (45%), and reviews on software (37%) play an important role and have influence on consumers who tend to make purchases and buy online.

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In addition to online reviews, peer recommendations on the online shopping pages or social media play a key role for online shoppers while researching future purchases of electronics, cars and travel or concert bookings. On the other hand, according to the same research, 40% of online shoppers indicate that they would not even buy electronics without consulting online reviews first.

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