Analysis of the survey

On
Study of E-retailing to identify important factors that influence the
consumer buying behavior

Submitted by:
Mohammad Saif
Nishchaya Sadhwani
Merin Mathai

CONTENTS
1

Overview:................................................................................................................ 3

How many people shop online?..................................................................................... 4

Age wise gender distribution:........................................................................................ 5

Income levels........................................................................................................... 6
4.1

Preferred device to shop:....................................................................................... 6

Duration of shopping:........................................................................................... 8

.How do people come to know about the websites?.............................................................9

Most visited websites:............................................................................................... 11

Factors affecting consumers buying behavior on these websites..........................................13

Products bought online.............................................................................................. 15

10

Conclusion:.......................................................................................................... 16

1 OVERVIEW:
Over the last two decades, rising internet and mobile phone penetration has changed the way we
communicate and do business. E-commerce is relatively a novel concept. It is, at present,
heavily leaning on the internet and mobile phone revolution to fundamentally alter the way
businesses reach their customers.
In India, e-commerce providers operating either through inventory-led or marketplace models,
are entering an entirely different paradigm of operations, where management of the supply chain
is core to the business of creating more business.
With real-time demand and tight delivery expectations, the supply chain needs to be built from
the customer-end, with the fundamental difference being the proliferation of delivery points and
the need to move large number of orders of small parcels (one or two goods) across the length
and breadth of the country at an affordable cost.
The essence of e-retailing is in its ability to transcend physical
and reach customers in a manner different from the traditional
and- mortar stores, to their very doorstep. However, the base of
retailing model is technology and logistical solutions that
facilitates the customer acquisition and the final reach
process. E-commerce further brings to the table vagaries in
customer orders accompanied with difficult scenarios such as
delivery, order rescheduling, cancellation, returns and cash-ondelivery.

boundaries
brickthe e-

free

The sector is still in its growth stage in India and has enormous
potential to offer in the coming years. The governments most
prestigious Digital India project could take the sector to new heights.
This research is an attempt to identify the key factors which affect the consumers behavior when
he/she shops online.

2 HOW MANY PEOPLE SHOP ONLINE?

People shopping online

No; 3%
No

Yes

Yes; 97%

Inference:
E-commerce has been experiencing stupendous growth in recent times which led to a boom in Etailing in India which makes it absolutely clear why 97% of the above pie chart is taken up the
people who shop online. With the change in technology and fast paced lifestyle people are
switching from the usual brick and mortar stores to e-tailing.
The remaining 3% who have said No to e-tailing are the ones who are aware about e-tailing
but somehow, due to lack of infrastructure i.e poor internet connectivity or they do not have their
own source of income i.e people below the age of 21.

. AGE WISE GENDER DISTRIBUTION:

Age wise gender distribution

40
35
30
Female

25

Male

20
15
10
5
0

21-30

30-45

45-60

Below 21

Inference:
Out of the hundred respondents majority of the respondents belong to the 21-30 age group
category. Also, majority who are shopping online are female respondents. This is because being
the home makers they have to shop not only for themselves but also for their homes. Also, within
the age group of 21-30 other factors like:

Change in fashion
Social status
Technology craze, etc.

Contribute majorly in driving this age group to shop online. With the increase in age the trend to
shop online has decreased drastically.
People who are below 21 especially the students though being crazy about online shopping are
not able to buy products online as they do not have their own source of income and are
dependent on their parents.

4 INCOME LEVELS

Gender wise income levels

16
14
12
10
8
6
4
2
0

Female
Male

Inference:
Majority of the income levels lie between 1 lac to 4 lacs which is the working class. Also people
having the income level of more than 4 lacs are not that much inclined towards online shopping
as their products include luxury products and they prefer shopping from the brick and mortar
store rather than shopping from the websites.

4.1 PREFERRED DEVICE TO SHOP:

Preferred device to shop

Laptops/Personal
computers

14%
39%

Mobile phones
Tablets
(blank)

47%

Since, the average income is around

1-4 lacs, a person is easily able to afford devices like smartphones, tablets and laptops which
makes the e-tailing websites easily accessible.
Mobile phones are the most preferred device to shop as many of the e-taliers have their
app platforms available.

Mobile phones: More than 235 million people in India access internet through mobile devices.
This is the primary reason for e-tailers to focus their efforts on mobile app penetration across the
country. The mobile applications are helping to reach more customers located even in remote and
rural areas. E-commerce companies have been able to bridge the service gap considerably by
sending service updates and other communication via their mobile app, e-mail, and SMS. The
revenue coming from mobile app
is on the rise e.g. 50% for Flipkart
while 70% for Quikr. 8
Customers can get alerts, view
product catalogues, purchase and
pay with a simple mobile
application offering a compelling
user experience. Also, from
mobile usage, the e-tailers get
valuable customer information
which can be used for analytics to
improve their services and sales.

5 DURATION OF SHOPPING:

How often do you shop?

30
25

24

Once a month

20

Once a week

18

17

Once in 3 months

15
10

5
0

Once in a year

12

Female

(blank)
6

Male

Inference:
As per the survey, majority of the respondents prefer to shop online once a month. Also, majority
of the respondents are females. Males prefer shopping online once in 3 months as per the needs.
The frequency of people who shop once in a year is the least because in the present day scenario
almost everybody is frequently on e-tailing websites.
The duration of the purchase also depends on the situational influences also. A persons needs
may vary with time.

6 .HOW DO PEOPLE COME TO KNOW ABOUT THE WEBSITES?

How do people come to know about these websites?

23%

31%

12%
34%

Friends and relatives

Print ads

Electronic media

Social media

Inference:
Majority of the respondents i.e 34% have said that they come to know these websites on
electronic media (T.v, Internet) etc. 31% have said that they come to know about these
websites on social media platforms like facebook, twitter etc. 23% have said that their friends
and relatives have recommended them various websites as result of their previous shopping
experience on the websites. Print ads of e-tailing websites attract 12% of the respondents. Etailing websites usually give print ads when they have to promote a certain campaign on their
websites. For eg: Big billion day etc. Another way in which e-commerce stores are turning to
print media is through the production of ad-supported magazines. These are magazines that
feature mostly items available through the website.

Digital Advertisements: The digital advertisement industry is growing rapidly as there is a

growth in digital communication devices around the world. The increase in smartphones, tablets
is enabling advertisers to reach a wider audience. According to analysts, the Indian online ad
market will grow year-on-year at 30% to reach ` 35.75 billion by March 2015. 9 The digital
advertisements are flexible and can be adapted for any kind of device like Television, laptop,
tablet, or smartphone. The two-way interactive capability and the ability to customize the ad for
target audience also make digital advertisements more effective.

Social media platforms: Social networks have started to play a significant

the growth of the e-commerce business. The maturity of social
media and its reach across masses and classes makes it a suitable
platform for online sales. Social media pages provide information
regarding new products in the market, user reviews and ratings of the
product, recommendations, share products, etc.

role in

Social media also helps e-tailers to build brand awareness by

responding to customer queries. Seasonal sales and offers are displayed
in
social networks to reach maximum number of people. E-tailers have even
started to motivate customers with reward points to provide feedback on the product on social
networks. Prospective customers also interact with users of the product or service on social
networks before making purchase decision.
The social media provides a platform for e-tailers to engage with customers for:
Advertisement
Building brand awareness
Developing a community of trusted users
Spreading Word-of-Mouth
Customer feedback

MOST VISITED WEBSITES:

Most visited website

Others; 10%
Jabong; 9% Flipkart; 27%
Myntra; 14%
Snapdeal; 14%

Flipkart

Amazon

Amazon; 25%

Snapdeal

Myntra

Jabong

Others

Inference:
Flipkart wins the crown when it comes to most visited website. 27% of the respondents have
chosen Flipkart as the most visited website. Amazon not far behind is giving stiff competition to
Flipkart with 25% preference from the respondents. Snapdeal and myntra are neck to neck with
each other. Others include websites like Koovs.com, yepme.com, etc.
Amazon India and Flipkart, the countrys biggest e-commerce firm, are supposed to operate as
marketplace platforms that connect small merchants with buyers. They arent allowed to sell
directly to shoppers.
But both the companies have adopted complex corporate structures and used loopholes in the law
to deploy a mix of the marketplace and the direct-selling business model.
Flipkart plans to operate as a marketplace and earn the bulk of its revenues from ads and other
services, such as logistics and warehousing charged to sellers.

Amazon, on the other hand, is on familiar ground, adopting its mantra of low prices and wide
product assortment through its direct selling plus marketplace model to please customers,
without bothering too much about making profits.
Currently, both companies, along with Snapdeal, have the same goal: to dominate e-commerce
sales, which may increase to anywhere between $48 billion and $60 billion by 2020 from $4.47
billion last year, according to Swiss financial services firm UBS AG.
In response to increasing competition and growing demands from merchants, digital offer
providers are also trying to differentiate their sites and mobile apps, attract new sellers and
buyers by expanding into luxury goods and exclusive experiences. For example, Snapdeal
acquired the luxury brand Exclusively.in to provide access to widest range of aspirational, highend products and services. E-commerce providers such Flipkart also provide a whitelabel
platform for other companies such as Chinese smartphone-maker Xiaomi, which enable the
scalable execution of multiple flash sales by consolidating expenses such as technology and
sales.

. FACTORS AFFECTING CONSUMERS BUYING BEHAVIOR ON THESE WEBSITES

Factors aff ecting consumer behavior online

User Friendly Interface; 18%

Product quality; 20%

Payment Options; 21%
Choice of products; 23%
Delivery Options; 18%

Product quality

Choice of products

Payment Options

User Friendly Interface

Delivery Options

Inference:
Majority of the respondents think that choice of products is
the most important factors which draws them to these websites.
According to the respondents, product range on e-tailing
websites is much better than the product range in normal brick
and mortar stores.
The second most important parameter are the Payment
options. With the increase in the payment options sales on
ecommerce websites have increased by large numbers. There
are various payment options available:
1) Credit cards - The easiest form of electronic money that is available and most widely used
today. There are several million credits cards that are being used to make online payments in
India.

2) Debit cards- The second largest e-commerce payment medium in India Debit Cards and
Netbanking. Very often, for customers who want to stay within their spending capacity, paying
for things online using a debit card proves to be a preferred choice.

3) Cash on delivery CoD has emerged as one of the most sought after services for e-commerce
entities and it is reported that in some cases as high as 50 per cent of orders are placed with
various online retailers with this payment option, while the remaining opt for credit card or bank
payments. In India, many customers tend to prefer CoD as the online payment modes are yet to
catch up in many parts of the country.
4) Netbanking Another easy way to make payments for online transactions. It uses a similar
method to the debit card of paying from money that exists in the users current or savings account
but netbanking does not require the user to have a card for the payment purposes. While
completing the purchase the consumer needs to put in their netbanking id and pin.

5) Mobile Money Out of Indias 1.2 billion people, only a small percentage have bank
accounts. Amongst that massive unbanked population, many hundreds of millions have mobile
phones, and for them, mobile money is likely to be hugely beneficial. Even for smaller
transactions, where credit cards are not accepted, it might be simpler to just hand over cash. But
if you dont have sufficient cash, then mobile money becomes useful.

9 PRODUCTS BOUGHT ONLINE

Products bought online
80

75

70
60

55

50

42

40
30
19

20
10
0

Apparels

Gadgets

Appliances

Personal and health care

Inference:
Majority of the respondents buy gadgets from the e-tailing websites followed by apparels.
Personal and health care products are slowly catching up with the change in health trends of the
people. Electrical appliances like LED tvs, microwave ovens etc. are still not preferred by the
buyers as they are costly products and a customer needs to check the product first and then buy
it.

People going to the store first and then shopping online

Yes

52%

48%

No

Although, nowadays customers visit the store first, test the product and then shop online. This
has decreased the sales from the traditional brick and mortar stores.

10 CONCLUSION:
With the help of this research we are able to conclude that the E-tailing market in has got
phenomenol potential and with the change in the modern technology it will sure grow more and
more.
When it comes to the factors which are affecting the consumer buying behavior when he/she
shops online, we found out that they are visiting the e-tailing websites because of the vivid
variety of products which are avaialble on the websites. Also, they look for the kind of
payment options which are available on the websites. The bottom line is how conviniently a
customer is able to shop a particular product.
Talking about how a customer comes to know about these e-tailing websites the inference which
we gathered is that majority of the customers get influenced by the electronic media i.e TV,
internet etc. The second influencer is social media, which is no surprise as the internet
penetration is growing day by day and almost everybody nowadays is on social media. We also
found out that Print ads are not much of an influence as the e-tailing websites use it only when
they are promoting a particular sale or event. For eg. Big billiion day
When it comes to the most preferred device to shop, undoubtedly mobile phones took the cake as
they are the most convinient device to shop online. Also, with the introduction of app platform
by the e-tailing websites, it has become more easy to shop online. The use of laptops for
shopping online is moderate whereas, very few people use tablets as their preferred device to
shop.

Another trend which we obsereved that people tend to look out for the product in brick and
mortar stores first, selecting the product and then shopping the same product online. This has led
to decrease in sales from the traditional brick and mortar stores.
Finally, e-tailings business model provides a transparent retailing environment for both the
customer and the e-tailer. E-tailing provides an electronic point of sale that records sales and
thereby creates a certainty in the system about the actual volume/value of sales. Even if the
customer decides to pay in cash (i.e. through cash-on-delivery), this eliminates any scenarios of
under-invoicing and under-reportage.