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DOI: 10.1177/2319510X13483515
2013 9: 77 Asia-Pacific Journal of Management Research and Innovation
Teena Bagga and Manas Bhatt
A Study of Intrinsic and Extrinsic Factors Influencing Consumer Buying Behaviour Online
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Article
A Study of Intrinsic and Extrinsic
Factors Influencing Consumer
Buying Behaviour Online
Teena Bagga
Manas Bhatt
Abstract
The purpose of this article is to identify the various intrinsic and extrinsic factors which effect the consumers buying behaviour
online. The intrinsic factors are the inner motivations or drives of the consumers and the extrinsic factors are the marketer generated
Internet marketing activities. The article aims at identifying these factors and their relative importance on the consumers purchase
behaviour. The theoretical framework of this article is based on a vast Internet marketing literature. The hypothesised model was
created that took into account the dependent and independent variables which were extracted using an exploratory factor analy-
sis and these variables were used to construct hypotheses which were empirically tested through techniques such as independent
t-tests and ANOVA. A structured questionnaire was used for this purpose and a survey was conducted on a sample of 200 through
judgemental sampling. Questionnaires were filled by respondents in person as well as a pre-defined list of respondents based on their
demographic profile was selected and questionnaires were mailed and posted online. The Exploratory Factor Analysis identified seven
major intrinsic and extrinsic factors which govern the consumers buying behaviour. These seven factors were: Need for Recreation,
Convenience, Website Attributes, Online Advertising, Social Communication, Information Search and Security and privacy concerns.
The importance of these seven factors differ across different demographic variables such as age, income group of consumers and
gender. The article presents a simple approach towards identifying the most effective Internet marketing tools that companies should
employ and also helps in better understanding the online consumer behaviour which differs from the traditional consumer behaviour
across various dimensions.
Keywords
Internet marketing, buying behaviour, online advertising, brick and click, consumer decision making, social networking
Asia-Pacific Journal of Management
Research and Innovation
9(1) 7790
2013 Asia-Pacific
Institute of Management
SAGE Publications
Los Angeles, London,
New Delhi, Singapore,
Washington DC
DOI: 10.1177/2319510X13483515
http://apjmri.sagepub.com
Teena Bagga, Assistant Professor, Department of Information Technology, Amity Business School, Noida, India.
E-mail: tbagga@amity.edu
Manas Bhatt, MBA (Marketing and IT), Amity Business School, Noida, India.
E-mail: manas.bhatt@absolutdata.com
Introduction
Today it is not sufficient for any large enterprise to main-
tain a stronghold in the market by just sticking to the
traditional medium of marketing, that is the Brick and
Mortar system. Organisations need to have an online
presence to keep with the fast paced growth of technology
and changing consumer preferences.
The consumer is changing as well as the market place.
Marketing is taking a new shape and a shift from the tradi-
tional 4Ps is inevitable. A McKinsey survey of marketing
executives from around the world shows that in marketing,
things are starting to change and companies are moving
online across the spectrum of marketing activities, from
building awareness to after-sales service and they see
online tools as an important and effective component of
their marketing strategies.
Companies have different options to reach the prospec-
tive customers but Internet has become the main medium
for reaching potential clients anywhere across the globe.
Internet has changed the way people used to do things. It
brings the global audience closer and introduces a new
medium of advertising which is quite unique compared to
other advertising media (Spilker, 2010). Similarly search
engines like Google, Yahoo, make the searching of prod-
ucts and services very easy and have become an excellent
source of obtaining new clients as well as a medium of
Brand Building.
The online behaviours of consumers are subtlety
different in nature from traditional consumer behaviour
due to the unique characteristics and interplay of techno-
logy and culture (Chau.M, Cole.C et al., 2009). Although
commercial use of the Web has been increasing at an
exponential rate, how the multidimensional aspects
at Alexandru Ioan Cuza on February 28, 2014 abr.sagepub.com Downloaded from
78 Teena Bagga and Manas Bhatt
Asia-Pacific Journal of Management Research and Innovation, 9, 1 (2013): 7790
inherent in traditional consumer behaviour change in the
context of e-commerce is sparsely researched, despite its
importance.
Internet Marketing Redefined
Shifting from the traditional 4Ps, marketers are now using
the Internet as a new medium of reaching to the customer
and this is evident from the increased share of revenues
being invested in developing the Internet as a marketing
tool.
Internet marketing encompasses a whole spectrum of
activities which generally include:
Communication Strategy: Online advertising, sales
promotions online and spreading consumer aware-
ness through different online channels including
social media, viral information etc. Liu and Xiao
(2008) stated that people opt for online shopping due
to a variety of utilitarian and hedonic needs out
of which discounts and special deals is one of the
most important which makes advertising and sales
promotions online an integral part of any companys
Internet marketing strategy.
Distribution Strategy: According to many research-
ers one of the main purposes of online shopping for
consumers is the convenience associated with order-
ing and receiving products at the door step.
Companies are looking to strengthen their distribu-
tion channels by eliminating the middlemen thereby
creating a win-win situation by cutting down middle-
men margins and a speedy doorstep delivery to its
consumers (Darrel, 2011).
Website Designing: Another key attribute which
has to be taken into account when developing a
full-fledged Internet marketing strategy is to design
your website in such a way that it is user friendly,
informative, attractive and becomes a tool for differ-
entiation from its competitors (Thomas, 2008).
An average customer has to be considered as a
non-technical and non-computer friendly individual
and the website should be designed accordingly also
keeping in mind the type of audience or the demo-
graphic profile of the prospective website visitors.
For example, A company dealing with toys or baby
products will be targeting the age group 015 which
will require a website which is user friendly as well
as colourful and vibrant.
Payment Options and Security: For an orthodox
consumer the Internet itself poses a threat to his
purchase intentions due to a variety of security and
privacy concerns. Consumers generally prefer Cash
on Delivery due to the convenience and safety asso-
ciated with it, but as all websites do not provide this
option it becomes a major influence on consumers
buying intentions online which makes wide availa-
bility of payment options and secure browsing a vital
component of the Internet marketing strategy of any
company.
Understanding the Internet
Consumer
The consumer psyche is dynamic in nature so is the mar-
ketplace in todays scenario. Companies before developing
any strategies for its prospective consumers have to under-
stand the consumer decision making process. Fishbein and
Ajzen (1975) proposed the theory of reasoned action
according to which consumers rely on intrinsic cues more
as compared to external stimuli. An individuals inner
drives which arise due to his needs propel him to take
purchase decisions.
The commercial evolution of the World Wide Web has
resulted in an environment where consumers engage
directly with businesses in a variety of ways right from the
regular Brick and Mortar establishments to social network-
ing websites and micro-blogging (Reppel and Szmigin,
2010). This calls for a holistic marketing effort on part of
the marketer to engage the consumers in the best possible
manner and develop a favourable image about the company
and its offerings in the minds of the consumers.
Behind the visible act of making a purchase lies a deci-
sion process that must be investigated.
According to J. Scott Armstrong (1991) the purchase
decision process is the stages a buyer passes through in
making choices about which products and services to buy.
The stages are:
1. Problem Recognition
2. Information Search
3. Evaluation of alternatives
4. Purchase Decision
5. Post purchase Behaviour
Marketing stimuli act at each stage of the decision making
process and become a major factor in consumer buying
behaviour and satisfaction. The initial problem recognition
stage of the decision making process is a result of
consumers black box (Loudon, 1988) which includes the
individuals Attitudes, Motivation, Perceptions, Personality,
Lifestyle and Knowledge. Once the consumer recognises
his needs he looks for information from various resources
a concept named as the Zero moment of truth.
Factors Infuencing Consumer Buying Behaviour Online 79
According to L.G. Schiffman (1993) apart from the
internal factors consumer behaviour can also be affected
by external influences, such as culture, sub-culture, local-
ity, royalty, ethnicity, family, social class, past experience
reference groups, lifestyle, market mix factors. Some of
these factors can be controlled by the marketers such as the
marketing mix and some of the online reference groups.
Literature Review
Smith and Chaffey (2005) give a short and basic definition
of Internet marketing as Achieving marketing objectives
through use of electronic communication technology.
According to Hoge (1993), Internet marketingis the
transfer of goods or services from seller to buyer that
involves one or more electronic methods or media. Reppel
and Szmigin (2010) focused on the commercial evolution
of the World Wide Web which has resulted in an environ-
ment where consumers engage directly with businesses in
a variety of ways. The Internet has become an indispensa-
ble tool for todays businesses. Every business organisa-
tion is using it in some way or another these days. Marketing
managers who fail to use the Internet in formulating their
companies marketing strategy will be at a disadvantage.
Yannopoulos (2011) discusses how the Internet is impact-
ing the conduct of a firms marketing strategy. The discus-
sion includes the impact of the Internet on product and
brand strategy, pricing strategy, distribution and promotion
strategy.
Hoges (1993) idea of Internet marketing is simple but it
does not touch the important aspect of customer relation-
ship. Strauss and Ansary (2006) defined Internet marketing
in their latest book as the use of information technology in
the process of creating, communicating and delivering
value to customers and for managing customer relation-
ships in ways that benefit the organisation and its stake
holders. This explanation tells that e-marketing is not only
about selling products or providing services through IT but
it is lot more than that. It is not just traditional marketing
using the information technology tools but its a strategic
model to achieve brand value and provide customer
satisfaction.
Thomas (2008) identified the different approaches to
B2B and B2C Internet marketing across cultures. Most of
the studies included determined that the use of Internet
marketing has a positive impact on the firms marketing
performance. The findings also suggest that the Internet
experience and perceived risk play an important role in
consumers purchase likelihood.
To understand the consumer behaviour of online con-
sumers it is important to first understand the relation-
ship between the consumer behaviour and consumer
satisfaction of online consumers. Liu and Xiao (2008)
developed a hypothesised relation model between con-
sumer satisfaction and the consumer behaviour of online
consumers. They created this model based on the theory of
reasoned action (Fishbein & Ajzen, 1975). Technology
acceptance model (David, 1988) and the Innovation diffu-
sion model to formulate their hypothesis and test them
empirically using techniques such as factor analysis, rela-
tion analysis and hypothesis testing. The study indicated
that all the hypothesised variables were positively related
with consumer satisfaction apart from convenience to shop
and customer service quality does greatest effect on the
consumer satisfaction among all the nine factors which
they had identified.
Several well-known models such as the AIDA model
(Strong, 1925) or the frequently cited hierarchy-of-effects
model (Lavidge & Steiner, 1961) have been developed that
try to explain the consumers persuasion process (Grabam
& Havlena, 2007; Vakratsas & Ambler, 1999). The AIDA
model is one of the first formal advertising models,
attributed to E. St. Elmo Lewis in 1898 (Strong, 1925).
AIDA is an acronym for Attention, Interest, Desire and
Action. Lewis theorised in his model that salespeople
have to attract attention, maintain interest and create desire
and the resulting action in order to be successful. Some
studies show the way in which advertising messages
have an effect on consumers perception (for example,
Baumgartner & Sujan, 1997) or the brand. Numerous
studies focus on which advertising effort works when, for
which consumer and under what circumstances (Ansari &
Mela, 2003; van Heerde, Helsen, & Dekimpe, 2007).
According to Schiffman, L.G. (1993) apart from the
internal factors consumer behaviour can also be affected
by external influences. ( Acar & Pol ons ky, 2007)
examined the impact of personality factors such as extra-
version, self-esteem, opinion seeking and opinion leader-
ship on brand communication and online social behaviours.
The results show that gender and extroversion predict
online social network size and time spent online; that
opinion seekers spend more time online and have larger
networks relative to opinion leaders; and that opinion
leaders are more likely to communicate their brand use
online (Chen, Fay & Wang, 2011).
To understand need for recreation as an important
dimension of online shopping. Filo, K, Funk (2005) advo-
cates a more consumer-oriented approach to Internet mar-
keting. The main focus is given to sports organisation.
Internet marketing allows sport organisations to coordinate
venue-based consumer experience with virtual content
provided on Internet websites. It also allows them to capi-
talise on features of the product that consumers find
attractive.
Hairong Li, Cheng Kuo, Maratha G. Rusell (2006) have
found out in their study that recreational buyers are those
who are frequent and occasional Web buyers. They are
indeed not more price-sensitive than non-Web buyers.
They have also emphasised that recent advances in the
shopping environment includes use of surround video, 3-D
images and VR technology, which are likely to be the main
characteristics of the second generation of online stores.
These experience-oriented features give the consumers a
shopping experience in which they can take full advantage
of rich information, easy access and convenience of the
Internet.
Convenience is another important dimension in online
shopping. Kuan-Pin Chiang, Ruby Roy Dholakia (2003)
examine three essential variables of consumers intention
to shop online (a) convenience characteristic of shopping
channels, (b) product type characteristics and (c) perceived
price of the product. Results indicate that convenience and
product type influences consumer intention to engage in
online shopping. When consumers perceive offline shop-
ping as inconvenient, their intention to shop online is
greater. Also, online shopping intention is higher when
consumers perceive the product to be search goods than
experience goods.
Andrew J. Rohm and Vanitha Swaminathan (2004)
developed a typology based upon motivations for shopping
online. An analysis of these motives, including online
convenience, physical store orientation (for example,
immediate possession and social contact), information use
in planning and shopping and variety seeking in the online
shopping context suggests the existence of four shopping
types. These four types are labelled as convenience shop-
pers, variety seekers, balanced buyers and store-oriented
shoppers. The convenience shopper is more motivated by
convenience. The variety seeker is substantially more
motivated by variety seeking across retail alternatives and
product types and brands than any other shopping type.
Balanced buyers are moderately motivated by convenience
and variety seeking. The store-oriented shoppers are more
motivated by physical store orientation.
To study the role of website attributes in online shop-
ping, Ming Hui Huang (2003) identifies Web attributes,
their direct impacts on experiential flow and their direct
and indirect impacts on the utilitarian and hedonic aspects
of Web performance. The results presented supported the
proposal that, as an information-laden medium, a success-
ful website must be able to use its attributes to satisfy both
the information and entertainment needs of users.
Online advertising helps in creating Word of Mouth.
Bronner and De Hoog (2010) analysed the impact of
e-WOM (electronic word of mouth) in consumer decision
making process. They coined a term e-fluentials for the
opinion leaders and experts who give expert advice regard-
ing different products and services online. The research
concluded that e-WOM reinforces the consumer decision
making process and e-WOM in consumer generated web-
sites deal with the more positive aspects of products and
services rather than the negative ones, this result was
however contrary to the one hypothesised.
To understand social networks which is another dimen-
sion of Internet marketing. Doyle (2007) presented a social
network analyses which focused on identifying the most
important factors which makes consumers confident to
make a purchase decision. The results of the study were
based on case studies from fashion retail and online
surveys. The study indicates that companies should focus
on identifying opinion leaders in social networks and
these opinion leaders will act as advocates of companies
product offerings and reinforce positive word of mouth
in the future.
Another external dimension in consumer decision
making process is information search Rutz & Bucklin
(2011) emphasised that in Internet paid search advertising,
marketers pay for search engines to serve text advertise-
ments in response to keyword searches that are generic (for
example, hotels) or branded (for example, Hilton
Hotels). The authors propose a dynamic linear model to
capture the potential spillover from generic to branded paid
search. The results show that generic search activity posi-
tively affects future branded search activity through aware-
ness of relevance. However, branded search does not affect
generic search, demonstrating that the spillover is asym-
metric. The findings have implications for understanding
search behaviour on the Internet and the management of
paid search advertising. Taylor et al. (2011) presents
research on Internet advertising, which examines consumer
attitudes towards advertising presented on social media by
users of those media. It was found that consumers reacted
most favourably to advertising which was perceived as
offering entertainment or information value. According to
Edelman, (2010) Digital marketers think of themselves as
publishers of online content, recognise digital marketing as
a means to acquire advocates for their brands and invest in
ways such as monitoring consumers to gain knowledge
about them in order to provide them with a satisfying sales
experience.
To study security and privacy concerns is another
dimension of Internet marketing. Anthony D. Miyazaki
and Ana Fernandez (2001) identify risk perceptions regard-
ing Internet privacy and security for both new and experi-
enced users of Internet technology. They explored risk
perceptions among consumers of varying levels of Internet
experience and how these perceptions relate to online
shopping activity.
Patrick & Massey et al. (2002) analysed the impact of
different cultures and ethnic origins of people on the online
buying behaviour. They conducted a survey in Hong Kong
and U.S and identified four major factors (Social commu-
nication, E-commerce, Hobby, Information search) related
to the use of Internet among people of Hong Kong and the
US. The results showed that people in Hong Kong are more
inclined towards Social communication and the US popu-
lation was more inclined towards information search as the
main purpose of Internet usage. Hence this study showed
that different cultures have different attitudes towards the
Internet and these implications can be used by marketers to
design websites according to different ethnic groups and
countries as the different purposes of use may lead to dif-
ferent impressions of the same websites.
Research Methodology
From the literature supporting Internet as a tool for market-
ing for companies worldwide and the impact on consum-
ers decision making and buying behaviour it was evident
that further research is required in this field to better
analyse the effect of Internet marketing which is a growing
phenomenon in both B2B and B2C businesses. Although
the users of Internet are growing day by day and companies
are turning to the non-traditional medium of marketing
through the Internet rather than completely relying on the
Brick and Mortar business model, the impact of Internet
marketing varies from industry to industry and there is a
lack of proper research in terms of consumers belonging to
different demographics. The research work especially in
the Indian context is not very intense which opens a huge
opportunity to further do research on this subject from the
context of Indian consumers.
From the reviewed literature a model was developed to
better understand the independent and dependent variables
and how they interact. The figure below was derived after
a detailed literature review and will be used as a basis for
the exploratory study. The model identifies Internet mar-
keting as the independent variable and consumer buying
behaviour as the dependent variable.
According to the figure the buying behaviour of con-
sumers depend upon various intrinsic factors and extrinsic
cues. The intrinsic factors include the different motivations
consumers have to shop online which also depends upon
the type of product or service they want to purchase, the
varying demographic profiles of consumers also impact
the purchase pattern of different products and services in
the web environment. An individuals need, motivations,
personality, lifestyle and attitude also influences his buy-
ing behaviour and decision making.
Apart from the intrinsic factors the buying behaviour is
often governed by many extrinsic cues which are usually
marketer generated and include the various marketing
strategies and tools which they employ. The research aims
at identifying these intrinsic and extrinsic factors which
influence a consumers purchase behaviour online and
sometimes also reciprocated while shopping at brick and
mortar establishments.
Sampling Design
Keeping in mind the time and resource constraints the
sample size estimated taking into account the samples used
in various researches of small (similar) magnitude, the
sample size is estimated to be 200 respondents. A struc-
tured questionnaire was prepared and validated by various
professors and academicians. A pilot survey was conducted
on a small sample of 20 respondents to ensure the feasibil-
ity of the questionnaire. After making certain adjustments
the final research instrument was formed.
The questionnaire consists of 19 statements on a 5-point
Likert scale and also a set of dichotomous and multiple
choice questions. The data was collected using judgmental
sampling approach wherein 220 questionnaires were
mailed to a pre decided list of respondents based on differ-
ent demographic variables such as age, income and gender
to get a better representation from each group. The ques-
tionnaires were validated for redundancies and an effective
sample of 200 respondents was selected after rejecting 20
questionnaires.
The demographic profile of respondents is summarised
in the above table. 40 per cent of the respondents belong
Figure 1. Hypothesized Research Model
MEA5UREMENT MODEL
LXTP|NS|C FACTOPS
lNTERNET MARKETlNG
TOOL5
|NTP|NS|C FACTOPS
CON5UMER BUYlNG
BEHAVlOUR
Onllne sbopplng motlvatlon
Demograpblc protlle
(Age, Genoer, Spenolng power)
Personallty, Lltestyle, Attltuoe
Source: Collected and compiled by the authors.
H
13
: There is a significant difference in importance assig-
ned to various dimensions influencing consumer buying
behaviour between different income groups.
H
01
: H
02
and H
03
are the null hypotheses whereas H
11
, H
12

and H
13
are the corresponding alternate hypotheses.
The first hypotheses was tested using an Independent
samples t-test whereas the other two hypotheses were
tested using a oneway ANOVA test for comparison of
means.
Data Analysis
The primary research focused on certain factors which
were derived after an in-depth review of literature. A factor
analysis was performed for the purpose of dimension
reduction which reduces the number of factors by clubbing
them together to further refine the results and give us a
better understanding of the most important factors in the
research.
Reliability
The Cronbachs Alpha model was applied to know the
reliability of the data collected through the Likert scale. A
score of 0.6 and above is considered to be reliable. A score
of 0.702 shows that the data collected through the Likert
scale is reliable, that is, data is consistent and worthy of
reliance or trust. A reliability of .0702 means that about
more than half of the variance of the observed score is
attributable to truth and less than half is attributable to
error. It can also be said that a reliability of .702 means the
variability is about 70 per cent true ability and 30 per cent
error. Hence the research can be carried out on this data set.
Table 1. Demographic Profile of the Respondents
Profile Frequency
Percent
%
Cumulative
Percent
%
AGE PROFILE
Less than 20 Yrs 28 14 14
2025 Years 80 40 54
2530 Years 76 38 92
Above 30 Years 16 8 100
Total 200 100
GENDER
Males 104 52 52
Females 96 48 100
Total 200 100
FAMILY INCOME
Less than 2 Lac 12 6 6
25 Lac 36 18 24
58 Lac 60 30 54
More than 8 Lac 92 46 100
Total 200 100
to the age group of 2025 years, 52 per cent of the respond-
ents were males and 46 per cent of the respondents belong
to the highest income group of above 8 lac.
Hypothesis of the Study
After reviewing the literature on the subject matter certain
hypothesis were formulated to compare the mean differ-
ences according to Gender, Age and Income groups for
various dimensions to be extracted after the factor analysis.
H
01
: There is no significant difference in importance assig-
behaviour between males and females.
H
11
behaviour between males and females.
H
02
behaviour between different age groups.
H
12
behaviour between different age groups.
H
03
behaviour between different income groups.
Table 2. Cronbachs Alpha Reliability Test
Reliability Statistics
Cronbachs Alpha Cronbachs Alpha Based
on Standardised Items
No. of Items
.702 .702 19
Table 3. KMO and Bartletts Test for Sphericity
KMO and Bartletts Test
Kaiser-Meyer-Olkin Measure of Sampling Adequacy 0.741
Bartletts Test of
Sphericity
Approx. Chi-Square 1244.606
Df 171
Sig. 0.000
Sample Adequacy
The Kaiser-Meyer-Olkin (KMO) measure of sampling
adequacy is an index used to examine the appropriateness
of factor analysis. High values (between 0.5 and 1.0) indi-
cate factor analysis is appropriate. Values below 0.5 imply
that factor analysis may not be appropriate. A set of 19
statements describe various factors which were considered
to be important in influencing consumer buying behaviour.
These were subjected to principal component analysis
using Varimax rotation method with Kaiser normalisation
in order to reduce the multiplicity of variables into selected
factors. But before the factor analysis it is important to
consider the values of KMO measure of sample adequacy.
The research sample showed a score of 0.741, which is
greater than 0.5 which suggests that the data is adequate for
factor analysis.
Table 5. Rotated Component Matrix
Rotated Component Matrix
a
Component
1 2 3 4 5 6 7
Online shopping saves time and effort 0.130 0.215 0.056 0.255 0.647 0.117 0.326
Internet makes comparison of similar products
of different brands easier
0.031 0.021 0.147 0.039 0.862 0.155 0.028
Shopping at stores gives me more satisfaction and
enjoyment than shopping online
0.699 0.120 0.127 0.241 0.117 0.168 0.142
Table 4. Total Variance Explained and Eigen Values of the Extracted Factors
Total Variance Explained
Component
Initial Eigenvalues Extraction Sums of Squared Loadings Rotation Sums of Squared Loadings
Total % of Variance Cumulative % Total % of Variance Cumulative % Total % of Variance Cumulative %
1 3.071 16.162 16.162 3.071 16.162 16.162 2.339 12.312 12.312
2 2.593 13.646 29.808 2.593 13.646 29.808 2.232 11.748 24.060
3 2.278 11.989 41.798 2.278 11.989 41.798 2.069 10.889 34.949
4 1.759 9.257 51.054 1.759 9.257 51.054 1.964 10.334 45.283
5 1.461 7.689 58.743 1.461 7.689 58.743 1.786 9.398 54.681
6 1.324 6.970 65.713 1.324 6.970 65.713 1.583 8.329 63.010
7 1.022 5.377 71.091 1.022 5.377 71.091 1.535 8.080 71.091
8 .936 4.927 76.018
9 .864 4.549 80.567
10 .798 4.202 84.769
11 .605 3.182 87.951
12 .544 2.862 90.813
13 .433 2.278 93.091
14 .358 1.885 94.976
15 .318 1.675 96.651
16 .241 1.270 97.921
17 .168 .883 98.804
18 .128 .672 99.477
19 .099 .523 100.000
Extraction Method: Principal Component Analysis.
(Table 5 continued)
Rotated Component Matrix
a
Component
1 2 3 4 5 6 7
Personal contact and communication with sales
person are important while shopping
0.588 0.305 0.174 0.204 0.206 0.432 0.072
Touching or seeing the products in person is an i
mportant part of the shopping experience
0.772 0.259 0.083 0.135 0.020 0.056 0.067
Online banner ads and pop-up ads grab my attention
and are a good source of information
0.074 0.148 0.144 0.8480. 0.015 0.053 0.197
Blogs are an important source of information regarding
products and services
0.340 0.032 0.501 0.293 0.186 0.254 0.191
Viral information (videos/articles etc.) influences my
perception towards the products, people, organization etc.
0.096 0.319 0.186 0.042 0.015 0.095 0.804
I usually read online reviews of products before making a
purchase decision
0.257 0.002 0.789 0.295 0.136 0.014 0.569
Company webpages (Fan-pages) on social networking
websites are useful in spreading awareness about the
brand and its product offerings
0.194 0.459 0.320 0.252 0.236 0.125 0.517
I usually visit the companys website before making a
purchase of a product offered by the company
0.023 0.268 0.137 0.023 0.048 0.698 0.028
A user friendly and attractive interface of a website
influences me to visit the website again
0.262 0.129 0.312 0.098 0.082 0.715 0.112
I feel hesitant in making payments online 0.076 0.641 0.050 0.101 0.365 0.067 0.072
I dont mind sharing personal information on trusted websites 0.152 0.752 0.138 0.063 0.607 0.378 0.145
I dont mind receiving e-mails regarding new products
in the markets
0.069 0.284 0.296 567 0.205 0.161 0.2380.
I generally consult family and friends before making a purchase 0.034 0.013 0.045 0.377 0.735 0.333 0.054
I usually seek expert opinion online before purchasing
a high involvement (expensive) product.
0.065 0.183 0.846 0.070 0.001 0.132 0.021
Opinions of family and friends are more influential as
compared to industry experts
0.209 0.276 0.432 0.358 0.716 0.328 0.070
I usually share/tweet/post information regarding new
products in the market
0.158 0.066 0.112 0.167 0.081 0.065 0.752
Extraction Method: Principal Component Analysis.
Rotation Method: Varimax with Kaiser Normalization.
Note: a. Rotation converged in 9 iterations.
(Table 5 continued)
The above table indicates that 19 statements were
reduced to 7 factors which explained 71.091 per cent of
cumulative variance. The variance reflects considerable
contribution of these factors on influencing consumer
buying behaviour online. In other words 71.091 per cent of
the behaviour of consumers in choosing products online is
due to these 7 intrinsic and extrinsic factors. The first factor
has an Eigen value of 2.339 and since it is greater than 1.0
it explains more variance than a single factor. The percent-
age of variance explained by this factor is 12.312 per cent.
The second factor has Eigen value of 2.232 and it explains
11.748 per cent of variance. The third factor has an Eigen
value of 2.069 and it explains 10.889 per cent of the vari-
ance. The fourth factor has Eigen value of 1.964 and it
explains 10.339 per cent of variance. The fifth factor has
Eigen value of 1.786 and it explains 9.398 per cent of vari-
ance. The sixth factor has Eigen value of 1.538 and it
explains 8.329 per cent of variance. The seventh factor has
Eigen value of 1.535 and it explains 8.080 per cent of
variance.
1. FACTOR C1: Need for Recreation
Items Statements Factor Loadings
3 Shopping at stores gives me more
satisfaction and enjoyment than
shopping online.
0.699
4 Personal contact and
communication with sales person
are important while shopping.
0.585
5 Touching or seeing the products in
person is an important part of the
shopping experience.
0.772
The above table shows the factor loadings of different
factors according to which they were clubbed together. A
total of 19 statements were reduced into 7 factors:
The above table shows the loading of factor C1. Three
factors with positive loadings were chosen which indicate
that these variables share most of their variances between
them and thereby co-vary with each other. The factor iden-
tified is Need for Stimulation which means that respond-
ents feel that shopping outside caters to their recreational
needs and online shopping is not a means to satisfy their
recreational needs. This means that consumer buying
behaviour online is also influenced by inner motivation of
individuals. An individual whose recreational needs are
higher will not enjoy shopping online as convenience takes
a back seat in their case whereas if a person feels that con-
venience and time is more important for him then they will
be more inclined towards online shopping. For these indi-
viduals, the sales personnel play a driving force to shop.
They tend to communicate more with these sales personnel
to clear their doubts before purchasing. They are highly
dependent on feeling the product by touching it or seeing it
before buying. Since these elements are missing in online
shopping, so these shopper depend on outside shopping to
meet their recreational needs.
The second factor combines two statements which can
together be put into the category of Security Concerns
which is another intrinsic variable. According to this factor
online payments and personal information are the prime
security concerns of the customers which dictate their
2. FACTOR C2: Security Concerns
13 I feel hesitant in making payments
online
0.641
14 I dont mind sharing personal
information on trusted websites
0.752
online shopping motivations. Identity theft is still a concern
for consumers when hackers break into a merchants web
site and steal names, addresses and credit card numbers.
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. People with an orthodox mindset may hesitate while
online shopping due to their privacy and security concerns
whereas more techno-savvy people may find it a routine
thing to shop online without any hesitations.
The above factor signifies that people usually search for
a lot of information before making any purchase online if a
product is high involvement. The relevant internal psycho-
logical process that is associated with information search is
perception. Perception is defined as the process by which
an individual receives, selects, organizes, and interprets
information to create a meaningful picture of the world.
Consumers tendency to search for information on goods
and services makes it possible for researchers to forecast
the purchasing plans of consumers using brief descriptions
of the products of interest. After information search the
consumer compares the brands and products that are in
their evoked set. They read online reviews and seek expert
opinion before making a purchase. Once the alternatives
have been evaluated, the consumer is ready to make a pur-
chase decision. This can be predicated to the fact that
during online shopping people cannot actually see the
3. FACTOR C3: Information Search
7 Blogs are an important source
of information regarding products
and services
0.501
9 I usually read online reviews
of products before making a
purchase decision
0.789
17 I usually seek expert opinion
online before purchasing a high
involvement (expensive) product.
0.846
4. FACTOR C4: Advertising and Promotions
6 Online banner ads and pop-up ads
grab my attention and are a good
source of information
0.848
15 I dont mind receiving e-mails
regarding new products in the
markets
0.567
products in person so they have to rely on opinions and
information available from various sources such as online
reviews and blogs written by experts.
The abovementioned factors can be clubbed into the
factor Online Advertising which primarily include online
banner ads, pop-up ads and marketing through e-mail.
These factors also impact the consumers buying behaviour.
The online consumers attention is grabbed with the help
of these online advertising tools. It is considered as a
good source of information and helps them in their pur-
chasing decision. E-mail marketing also includes sales
promotion schemes such as discounts and coupons which
are also an important aspect which influences the consum-
ers to use the online medium for shopping. Most of
the companies are doing direct marketing via emails.
Personalised emails are sent by companies to its online
consumer in order to coax them to shop online. The results
however showed that people are not very open to receiving
emails which can be seen through the low factor loading
score in case of e-mail marketing.
The below factors can be clubbed into a factor conven-
ience which implies that Internet makes comparisons
easier of different brands and also it saves time and effort.
Click and Shop provides the online shoppers a wide
variety merchandise of different brands which help them to
compare. Also the door to door delivery saves time and
efforts of these shoppers. Peer pressure plays a significant
role for online shoppers. A positive word of mouth spread
by the peer helps in buying decision. Consumers also find
it more convenient to depend on family and friends opin-
ions and consider them more important than industry
experts and family judgments are given more priority than
others.
The factor C6 talks about the companys website and its
interface which also has an impact on consumers buying
behaviour. A website which does not have ease of naviga-
tion and is not informative or attractive will result in lower
traffic on the website thereby reducing the number of
5. FACTOR C5: Convenience
1 Online shopping saves time and
effort
0.647
2 Internet makes comparison of similar
products of different brands easier
0.862
16 I generally consult family and friends
before making a purchase
0.735
18 Opinions of family and friends are
more influential as compared to
industry experts
0.716
6. FACTOR C6: Website Attributes
11 I usually visit the companys website
before making a purchase of a
product offered by the company
0.696
12 A user friendly and attractive
interface of a website influences me
to visit the website again
0.715
prospective customers. Consumers while shopping online
usually visit the companys website if they want to pur-
chase a product offered by their company and it becomes
very important to have an informative website with price
comparisons and specifications of the products which
makes it easier for consumers to decide whether to pur-
chase that particular product or not. Also the website must
be interactive enough so that the consumer is persuaded to
make the purchase.
The last factor extracted can be termed as Social
Networking. It helps in spreading the information about
the product by creating awareness about the brand.
Consumers are heavily influenced by social networking
websites and the information posted on them. Company
fan-pages and information shared by people on these web-
sites also influence consumer perception about the
company and its products and also the people associated
with the company. E-wom (Electronic word of mouth) is
also a very important factor which means that people get
highly influenced by the opinions posted by people online
which in-turn influences their buying behaviour.
The below table shows a one-way ANOVA to test the
hypothesis, There is no significant difference in the impor-
tance assigned to various dimensions influencing con-
sumer buying behaviour between people belonging
to different income groups. A mean score tending towards
1 implies that the dimension holds high importance in
consumers buying behaviour or purchase decisions. For
7. FACTOR C7: Social Networking
8 Viral information (videos/articles etc.)
influences my perception towards the
products, people, organisation etc.
0.804
10 Company webpages (Fan-pages) on
social networking websites are useful
in spreading awareness about the
brand and its product offerings
0.517
19 I usually share/tweet/post information
regarding new products in the market
0.752
Table 6. Income-wise Summary of Means and ANOVA of Dimensions Influencing Consumer Buying Behaviour
COMPARISION OF MEAN: ANOVA and T-TEST
Income wise importance of dimensions
ANOVA (Income Groups)
Less than 2 Lac 25 Lac 58 Lac More than 8 Lac F Sig.
Need for Recreation 1.777 1.963 2.1333 2.3467 118.935 0.000
Security Concerns 2.8333 3.27778 2.96667 2.91304 6.112 0.000
Information Search 2.6667 2.88867 2.64460 2.67336 1.309 0.001
Advertising and Promotions 2.5 2.833 3.1333 2.891 3.721 0.273
Convenience 2.22 2.08333 2.01667 2.00738 1.449 0.012
Website Attributes 2.0 2.7222 2.40 2.26087 6.052 0.230
Social Networking 2.778 2.777 2.6447 2.5797 1.108 0.347
people with annual income below 4 Lac per annum, need
for recreation is the most influential factor in governing
their buying behaviour. This implies that people with
income less than 4 Lac consider shopping as a means of
recreation and they prefer shopping at stores rather than
online. For the respondents with income more than 4 Lac
per annum, Convenience is the most influential factor in
shaping their buying behaviour.
At a significance level of 95 per cent (.05) a sig score of
greater than .05 implies that we cannot reject the null
hypothesis. The above table shows that for the dimensions
(need for recreation, security concerns, information search
and convenience) the significance value is less than 0.05
which implies that we cannot accept the null hypothesis
and there is a significant different in the importance
assigned to these 4 dimensions in the buying behaviour of
people belonging to different income groups. For all the
remaining factors (Advertising and promotions, website
attributes and social networking) the significance value is
greater than 0.05 which means that there is no significant
difference in the importance of these factors in the buying
behaviour of people belonging to different income groups.
The below table shows a one-way ANOVA to test the
hypothesis There is no significant difference in the impor-
tance assigned to various dimensions influencing con-
sumer buying behaviour between people belonging to
different age groups. For people below the age of 20, need
for recreation is the most influential factor in governing
their buying behaviour. This age group comprises mainly
of the school going students or teenagers who consider
shopping to be a recreational activity and hence prefer
shopping at stores rather than online. For the respondents
between the age of 20 to 25, information search is the most
influential factors in shaping their buying behaviour. This
implies that for these consumers information available
from various sources such as blogs and websites is the
most important factor while deciding upon purchasing a
product. They search for a lot of information and the avail-
ability of information influences their buying behaviour
online. The information on blogs, company webpages and
Table 7. Age-wise Summary of Means and ANOVA of Dimensions Influencing Consumer Buying Behaviour
Age wise importance of dimensions
ANOVA
Less than 20 Years 2025 Years 2530 Years More than 30 Years F Sig.
Need for Recreation 1.78571 2.3167 3.2860 3.0 28.646 0.000
Security Concerns 3.21429 2.9250 3.05263 2.6250 6.687 0.000
Information Search 2.5240 1.8833 2.52626 2.58350 3.827 0.011
Advertising and Promotions 3.42857 2.8 2.8158 3.25 8.402 0.000
Convenience 1.95243 1.9375 2.34211 2.25 18.476 0.000
Website Attributes 2.7143 2.3 2.5421 2.25 3.202 0.024
Social Networking 2.6686 2.5167 2.80695 2.49975 3.393 0.019
From the above table we can conclude that in case of
need for recreation, convenience, social networking and
online advertising and promotions there is a significant
difference among the mean scores of these factors which
influence the buying behaviour of males and females,
whereas for all other dimensions security concerns, infor-
mation searching and website attributes(sig <0.5) there is
no significant difference among the mean scores of males
and females for these factors.
Results and Discussion
The above analysis shows that a total of seven factors were
extracted after conducting a factor analysis and each of
these seven factors impact the consumers buying behav-
iour to a different extent.
The factors identified were: Need for Recreation,
Information Search, Security and Privacy concerns,
Convenience, Online Advertising, Website attributes and
Social Media.
The new refined model was developed based on the
analysis to understand the factors which influence consum-
ers buying behaviour.
The refined model shows that consumers buying
behaviour is more internally driven and extrinsic fac-
tors have lesser impact than the intrinsic factors.
Intrinsic factors like convenience influences con-
sumers to purchase online.
Need for recreation is another factor which signifies
the hedonic needs of the consumers. If a consumer
has high level of hedonic needs and likes going out
for shopping will most likely avoid shopping online.
Security concerns also have an impact on consum-
ers purchase behaviour but from the analysis it was
shown that from the mean value scores which was
closer to 3 which correspond to a neutral value on the
Likert scale. This implies that even-though security
concerns impact consumers behaviour online but it
does not become a predominant reason of not pur-
chasing products online.
Convenience is one of the major factors which gov-
ern the consumers behaviour in purchasing online.
The age group of above 25 years showed a greater
affinity toward convenience which may be due to the
fact that working people get very less time to their
disposal as compared to college going students
which had a greater need for recreation.
Social Networking and information searching also
plays an important role in buying behaviour. Social
networking leads to electronic word of mouth and
dissemination of information which influences the
Table 8. Gender-wise Summary of Means and T-Test of
Dimensions Influencing Consumer Buying Behaviour
Gender wise importance of dimensions
Males Females Sig t Sig (2-tailed)
Need for
Recreation
2.25962 1.91667 0.148 5.640 0.000
Security
Concerns
3.000 2.97917 0.032 0.309 0.758
Information
Search
2.64112 2.70829 0.039 0.646 0.519
Advertising
and
Promotions
3.09615 2.75000 0.845 3.627 0.000
Convenience 2.19235 2.51396 0.203 5.526 0.000
Website
Attributes
2.44231 2.29167 0.036 1.629 0.105
Social
Networking
2.76927 2.51383 0.403 3.016 0.003
online reviews are the most influential in their purchase
decisions. For the age group 2530 years, convenience is
the most important dimension and the possible reason
behind this could be the initial work pressure when the
individual has started off his professional career. The lack
of time makes convenience a very important factor for this
age group. People belonging to this age group are most
likely to shop online on a regular basis.
At a significance level of 95 per cent (.05) a sig score of
greater than .05 implies that we cannot reject the null
hypothesis. The above table shows apart from the dimen-
sion (Website attributes) the significance value is less than
0.05 which implies that we cannot accept the null hypoth-
esis and there is a significant difference in the importance
assigned to these six dimensions in the buying behaviour
of people belonging to different age groups. For the factors
(Website Attributes) the significance value is greater than
0.05 which means that there is no significant difference in
the importance of these factors in the buying behaviour of
people belonging to different age groups.
The below table shows independent samples T-Test to
test the first hypothesis that there is no significant differ-
ence in the mean of the seven factors in influencing the
buying behaviour of males and females. If the significance
value is greater than .05 (95 per cent confidence level) we
cannot reject the null hypothesis which implies that there is
no significant difference among the mean scores of the
factors influencing buying behaviour of males and females.
According to the mean values convenience is the most
important factor for males and need for recreation is the
most influential with respect to the female consumer
buying behaviour.
Figure 2. Refined Model Sepicting Factors Influencing Consumer Buying Behaviour Online
REFINED MODEL
CONSUMER BUYING BEHAVIOUR
INTRINSIC FACTORS
EXTRINSIC FACTORS
INTERNET MARKETING
INDEPENDENT
VARIABLE
ONLINE
ADVERTISING
FACTOR C1
FACTOR C2
FACTOR C3
WEBSITE
ATTRIBUTES
SOCIAL MEDIA
MARKETING
DEPENDENT
VARIABLE
Need for Recreation (FACTOR C4)
Information searching (FACTOR C5)
Security and Privacy concerns (FACTOR C6)
Convenience (FACTOR C7)
purchase intentions of consumers who look for such
information. Males show more information search-
ing behaviour and females are more prone to be
influenced by electronic word of mouth on social
networking websites.
Online advertising and promotions have higher
impact on females as compared to males and also the
age group below 25 years is more influenced by
online banner ads and promotional offers than people
above 25 years of age.
It can be concluded that these seven factors are the major
influencers of consumers buying behaviour online but the
impact of each varies from one another and also people
having different demographic profiles are influenced dif-
ferently by these seven factors. Companies should focus
more on social network marketing and improving their
website attributes as compared to online banner ads and
pop-ups which grab attention of consumers but do influ-
ence consumers buying behaviour to a large extent.
Marketers should disseminate more information through
non-traditional mediums such as consumer testimonials or
find brand advocates among the consumers and encourage
them in spreading positive word of mouth specially tar-
geted towards females.
Information about the products should be regularly
sent to prospective customers. This can be done through
identifying consumers who are interested in products
offered by the company by content analysis of social
groups and interest groups on various websites.
Convenience was a major factor in consumers buying
behaviour so companies should aim at making Internet
shopping more convenient by allowing facilities like COD
(Cash on delivery) and product customisation and video
demos online so that consumers can judge the product
attributes better without seeing them in person. The need
for recreation also influences consumers to shop via brick
and mortar channel. Companies can design their websites
in such a way that it becomes a shopping experience rather
than merely a business transaction. For example, Design
the website like an actual store with shelves of products
and animated sales personnel to guide the consumers.
Taking these insights from the research companies can
look at marketing from a different perspective and realise
that the consumer is more informed and educated and a
relationship with the consumers does not end at a mere
business transaction.
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