Introduction

Online shopping or online retailing 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, e-shop, e-store,
internet shop, web-shop, web-store, 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. The largest online
retailing corporations are EBay and Amazon.com, both of which are USbased.
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.
In this report we will try to explore current e-business scenario in
Bangladesh. Our research will be conducted in order to indentify various
challenges and obstacles in the process of e-shopping. We will also try to
shed light on probable solutions to those obstacles and thus see the
prospect of e-shopping in Bangladesh.

Research Objectives:
Objectives of the report can be defined as follows:

To analyze overall current scenario of e-shopping section in

Bangladesh

To analyze the factors which are creating obstacles in the path of eshopping process. Factors that have been considered in this aspect
are:
o Preference for super store over online shopping
o Consumers receptiveness over product quality
o Difficulty in product delivery
o Lack of government financial incentive

To analyze the factors which provide that basis for prospects and
opportunities for e-shopping sector in Bangladesh. Following factors
have been considered in this regard.
o Perceived convenience of e-shopping
o Security concern
o Product availability and diversity
o Entrepreneurs interest
o Present state of infrastructure

To examine and analyze various e-shopping models that exist in our

country in present circumstances.

Significance
As we have discussed earlier e-shopping is a way of conducting business
over the Internet. Though it is a relatively new concept in Bangladesh, it
has the potential to alter the traditional form of economic activities.
Already it has its effects on some large sectors such as communications,
finance and retail trade and it holds promises in areas of education, health
and government. The largest effects may be associated not with many of
the impacts that command the most attention (i.e. customized product,

elimination of middlemen) but with less visible, but potentially more

pervasive, effects on routine business activities (i.e. ordering office
supplies, paying bills, estimating demand).

Background Studies
Various kinds of researches have been conducted over the years on eshopping. Many of those reports covered issues such as brief description
of e-shopping, prospects and challenges of that particular business in both
global and local perspective. Most of those reports however focused on
online purchase of manufacturing products other than services. Many of
the reports that we searched have studied e-shopping from an overall or
global view, however, we have taken only those issues in consideration
that can have an implication in Bangladeshs context. This had to be done
as there is a scarcity of reports focusing exclusively on issues of prospects
and challenges of e-shopping in Bangladesh.
Online shopping is the process whereby consumers directly buy goods or
services from a seller in real-time, without an intermediary service, over
the Internet. It is a form of electronic commerce. An online shop, e-shop,
e-store, internet shop, web-shop, web-store, online store, or virtual store
evokes the physical analogy of buying products or services at a bricksand-mortar retailer or in a shopping center. The process is called Businessto-Consumer (B2C) online shopping. When a business buys from another
business it is called Business-to-Business (B2B) online shopping.
History of e-shopping points to one event of 1990 when 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.
Now lets have a look at e-shopping in the context of our country. In
Bangladesh situation isnt that much favorable for entrepreneurs due to
high inflation rate, interruption of regular power supply, inadequacy of
capital sourcing for startup entrepreneurs. Despite all these barriers our
entrepreneurs are taking initiatives to make progresses happen not only
for themselves but also for the society and the country as a whole. As
technology is becoming an everyday accessory and rate of Internet
penetration is increasing like wild fire people tendency to on-line shopping
is on rise. The most important reason behind a rise in on-line shopping
trend is time scarcity of modern life style. We are now living in an age of
scarce time. Shopping regularly for daily products is a luxury to this time
scarce society. As the trends show in near future the rate and extend of
on-line shopping will be increased in manifold. Taking indicators like
increasing Internet penetration, life style change, time scarcity into
consideration it can be a safe prediction that online shopping will be a
phenomenon in near future.

Scope
The scope of the report is limited to the practical and theoretical aspect.
Practical experience and data collection from different companies on
online shopping in Bangladesh is considered in this process and analysing
this data this report is furnished. The report also covered information from
some books, magazines, articles and various websites of different online
shopping stores of the country and incorporation of this ideas/knowledge
in the report have been introduced as well. The report will cover following
broad areas:

Current scenario of e-shopping in Bangladesh

Various obstacles in the path of e-business process

Opportunities and prospects of e-shopping

Different e-shopping models

Methodology
Data Collection:
Data have collected both from primary and secondary sources
Primary source: Survey, face-to-face interview.
Secondary source: Online reports, websites, different books, articles,
journals etc.
Methods for Analysis:
Regression models, hypothesis and questionnaire have been developed to
carry out the research. Details of those have been presented in following
segments. Apart from that some theoretical analysis have also been
carried out to shed light on various aspects of the report.

Limitations
Following can be considered as the limitations of the report:
Focus can seem to be a bit narrow one, as we will be concentrating
only on e-shopping rather than the whole e-business thing.
Although being a relatively theoretical report, the information
regarding

comparison

between

the

on

ground

situation

in

Bangladesh and abroad is unavailable in the report.

As the online shopping is still at its booming yet auspicious condition
in Bangladesh, the true picture of the real situation is not so easy to
identify.

Although there are numbers of studies have been done so far in this
particular issue on foreign online shopping, adequate number of
documents

is

yet

not

available

to

review

and

prepare

comprehensive report from Bangladesh perspective and it has been

reflected in the report prepared.

Problem Identification
As we mentioned earlier the objective of the report is assess the prospects
and challenges of e-shopping in Bangladesh. To achieve this objective we
have considered various factors that can stimulate or hinder e-shopping
operations in our country. The problems which we sought out to solve
through our report are given below:
Core Problem
Present state and future of e-shopping in Bangladesh in terms of
prospects and challenges it faces.
Research Problem
-

Which factors can stimulate growth and enhance the prospect of eshopping.

Which factors can pose significant hindrance in the path of eshopping operations in our country.

Approach to the Problem

Theory Development
To assess the present and future condition of e-shopping first we had to
identify the factors involved in the subject matter. Our research pertaining

to report unearthed quite a few factors that have substantial role to play
in the context of e-shopping. Those factors have been further categorized
depending on their respective role in the regression models that we have
developed for our research. Categorization of the factors is as follows:
Factors used to assess prospects
-

Perceived convenience
Security concern
Product availability and diversity
Entrepreneurs interest
Present state of infrastructure

Factors used to assess challenges

-

Preference for super store over online shopping

Consumers suspicion over product quality
Difficulty in product delivery

Lack of government financial incentive

Model Development
To conduct statistical analysis we have developed two regression models.
Following are the models used in the report
Regression model to assess prospect:
Y = X1b1 X2b2 + X3b3 + X4b4 + X5b5
Y = Prospect of online shopping in BD
X1 = Perceived convenience
X2 = Security concern
X3 = Product availability and diversity
X4 = Entrepreneurs interest
X5 = Present state of infrastructure

Regression model to assess challenges:

Y = X1b1 + X2b2 + X3b3 + X4b4
Y = Challenges of online shopping in BD
X1 = Preference for super store over online shopping
X2 = Consumers suspicion over product quality
X3 = Difficulty in product delivery
X4 = Lack of government financial incentive
Information Search
Information has been searched through both primary and secondary
sources. Survey questionnaire has been extensively used to collect data
from primary sources. In other cases various reports, journals have
studied to assess the situation and obtain information related to the report
topic.
Research Question and Hypothesis Development
In the earlier part of our research process, through exploratory research,
we have identified some factors that has a role to play in the prospects
and challenges of e-shopping. To measure the influence of these factors,
we needed to conduct some research questions and hypothesis. We
developed our questionnaire in such a way that we could get adequate
information on various factors and we established our hypothesis to check
the validity of various factors involved.
Research Questions
Two sets of questionnaire have been developed two collect the data. One
was to have feedback from consumers and the other was used to have
feedback from owners. Both of the questionnaires have been appended in
the Appendix section of the report.
Hypotheses

Following hypotheses have been developed to carry out the research. Two
categories of hypotheses were developed one group was related to
prospects and the other was related to challenges.
Hypotheses related to prospects
In case of the Prospect model, the null hypotheses can be put as:
1. Ho:

Positive

prospects

on

e-shopping

does

not

depend

on

convenience.
H1: Positive prospects on e-shopping depends on convenience.
2. Ho: Positive prospects on e-shopping does not depend on security
concerns.
H1: Positive prospects on e-shopping depends on security concerns.
3. Ho: Positive prospects on e-shopping does not depend on availability
& diversity.
H1: Positive prospects on e-shopping does depend on availability &
diversity.
4. Ho:

Positive

prospects

on

e-shopping

does

not

depend

on

entrepreneurs interest aka incentives.

H1: Positive prospects on e-shopping does depend on entrepreneurs
interest aka incentives.
5. Ho:

Positive

prospects

on

e-shopping

does

not

depend

on

infrastructure.
H1: Positive prospects on e-shopping does depend on infrastructure.

In case of the Challenges model, the null hypotheses can be put as:
1. Ho: Challenges in e-shopping is not motivated by Customer
receptiveness.

H1:

Challenges

in

e-shopping

is

motivated

by

Customer

receptiveness.
2. Ho: Challenges in e-shopping is not motivated by Consumers
suspicion over product quality.
H1: Challenges in e-shopping is motivated by Consumers suspicion
over product quality.
3. Ho: Challenges in e-shopping is not motivated by Difficulty in
product delivery.
H1: Challenges in e-shopping is motivated by Difficulty in product
delivery.
4. Ho: Challenges in e-shopping is not motivated by Lack of
government financial incentives.
H1: Challenges in e-shopping is motivated by Lack of government
financial incentives.
Research Design
To find out the triggering factors, we have conducted the research in the
Exploratory Research Design format.
There has been an Approach developed for further research and done to
find and fix its components like- Objective/Theoretical Foundations,
Analytical Model, Research Questions, Hypotheses and Specification of the
Information needed.
Now we will shift to a Quantitative approach known as Conclusive
Research Design. Because its will be more efficient, structured and formal
design process. Data analyzing are more reliable in this approach. So now
we will conduct the Descriptive and the Causal Research to meet the
proper accuracy on our marketing research process.
Questionnaire Design

For the purpose of the study two sets of questionnaires have been
developed, one is to take feedback from consumers and another is to take
feedback from owners. Based on exploratory research we have developed
20 questioners altogether. This research included questions considering
five factors to assess prospects and four factors to assess challenges. A
Likert scale was used to question the respondents on the five point scale.
The respondents were asked to rate on the scale between Strongly Agree
and Strongly Disagree.
This research aims to study prospects and challenges involved in eshopping in Bangladesh. This project primarily uses quantitative tools with
help from qualitative information. For quantitative results, the research
design involves descriptive research using survey method. Thus a
structured questionnaire has been used to elicit the specific information.
The sample size used for the project is 30 respondents for consumers and
12 respondents for owners.

Current Scenario of e-shopping in Bangladesh

Before going into prospects and challenges lets first discuss a bit about
the current scenario of e-shopping in Bangladesh as found from various
reports and websites. Of all the operating e-shopping businesses three
broad segments can be classified, one group serves as an e-shopping hub
connecting buyers and sellers; another group sells their own products
through their websites; and the other group uses social networking sites
to conduct e-shopping business. Below are some brief descriptions of
these groups.
Companies that work as a shopping hub
Lets first look at some of the companies that work as a shopping hub.
Akhoni.com

Akhoni.com is an online marketplace featuring discount deals with popular

businesses.
It provides discount deals with large number of businesses likerestaurants, hotels, theaters, fashion houses, Internet services, transports,
beauty parlors and saloons, theme parks, gymnasiums, furniture shops,
sports and recreation centers, etc.
Customers can sign up in the website to get regular deal alert on their
email at free of cost. They can receive the deal voucher instantly on their
web browser and through email by making payment instantly using VISA,
MasterCard or DBBL Nexus card or can also choose to book the deal online
and pay cash when the coupon is delivered to their home. Then, the
customer will show the voucher at the merchant location to enjoy the
deal.
Attraction of the website is offering huge discounts to the customers, 50
to 90 per cent discounts are alluring people to log on to the website
instead of going out for buying the products. Price hike is one of the major
concerns of mass people so offering discount opens up lots of
opportunities for the company mentioned above.
Clickbd.com
ClickBD.com started its operations in April 14, 2005, according to
Clickbd.com, as the first e-commerce portal in Bangladesh. ClickBD is an
online marketplace where anyone can sell or buy almost anything.
The site has a strong and growing community of users who trade in a wide
range

of

item

categories

including

Electronics,

Cameras,

Phones,

Computers, CDs, Mobiles, Fashion Accessories, Music, and Travel.

Through a world-class technology infrastructure ClickBD enables &
simplifies
community.

e-commerce

for

Bangladeshs

ever

expanding

online

Cellbazar.com
Originally designed as a classroom project at MIT, CellBazaar is one of the
most successful online and mobile shopping platforms. CellBazaar service
(http://www.cellbazaar.com) allows people to buy and sell over mobile
phones or computers.
Anyone with a computer and internet, as well as Grameenphone users
through their mobile phones are taking advantages of this service. Users
can buy agricultural products, such as rice, fish, chicken, as well as large
scale items like car, motorcycle, TV, fridge, apartment, land, etc. People
can also offer services such as language tutoring (very relevant for
migrants going abroad).
The service is customer focused, who post items for sale, delete items
after they are sold, and even adjust their own prices if they fail to get a
buyer. For the first time, the producers of agricultural products can directly
negotiate price with buyers and agro-processors.
The technology works on four synchronized platforms SMS (send SMS to
3838 to buy and sell), WAP (easy, graphic interface), WEB (viewable by
global audience), and IVR (call 3838 to hear latest items).
Hutbazar.com
Hutbazar.com, a sister concern of Right IT Corporation, pioneered online
comparison shopping and today is one of the fastest growing shopping
destinations for a comprehensive set of products from thousands of
trusted stores from across the Web.
With a singular focus on shopping, Hutbazar.com offers shoppers easy-touse search tools, engaging content and time saving navigation.
There are also other sites such as Cloudbd.com and Bdhaat.com who are
successfully running similar business ventures.

Companies that sell their products through their websites

Now lets turn our focus on the companies who sell or are in the process to
sell their own products through their websites.
Bashundhara Star Cineplex
Bashundhara Star Cineplex is the pioneer in the Dolby-Digital surround
movie theater experience in our country. Their infrastructure is the most
advanced one and world standard met facility in Bangladesh. At present
they havent yet gone live as far as their ticketing system is concerned
but they are in the process of realizing it soon. According to their website
the will soon be developing their web-portal with capabilities of online
booking and purchasing of movie tickets. They are also going to provide
superior online choice of seats to their prime members.
Amadergaan.com
Amadergaan.com is the biggest online portal for music in Bangladesh.
They are not just a site where you can discuss and analyze and get
previews of upcoming and buzzing music of the country but one can also
purchase albums or solos online. They promote anti-piracy, hence
developing authentic music sales and e-shopping. They dont exist only
virtually but time to time their forum organizes events where musicians
and music lovers can share the same platform for interaction and
exploration. Their technical infrastructure for monetary transaction
maintains high standard to prevent any fraudulent activities.
Companies that use social networking sites
Recently, there has been a new form of online marketing through the
social networking sites (especially Facebook) by entrepreneurs. Sellers
have their detailed portfolio displayed through these sites as business
pages. These pages get displayed through ads, through share of users. A
massive number people using social networking sites for entire online
communication need, some business person believe that this is a more

effective form of marketing. The payment system is similar to that of eshopping sites, only the environment is more cordial, site being based on
social networking. The owners create a personal link through active
approach towards customers and get a direct feedback through likes and
shares. Some of the ventures as such are listed below:
-

Shadamon, the exclusive fashion store

Achillies, contemporary fashion house

Following are some of the factors that are considered to be crucial by

various authors with respect to e-shopping. As we have mentioned earlier
authors have focused on these issues from a global perspective and we
have considered those points only which can be applied in Bangladeshs
context. Thus the below mentioned factors play an important role
determining the prospects and challenges of e-shopping in Bangladesh.
Customers
In recent years, online shopping has become popular; however, it still
caters to the middle and upper class as in order to shop online, one must
be able to have access to a computer and internet. Shopping has evolved
with the growth of technology. Electronic shopping exists as for customers
it is not only because of the high level of convenience, but also because of
the broader selection; competitive pricing and greater access to
information. So the volume of middle and upper level customers having
an access to internet and computer play a pivotal role in the e-shopping
industry.
Information load
Designers of online shops should consider the effects of information load.
Mehrabian and Russel introduced the concept of information rate (load) as
the complex spatial and temporal arrangements of stimuli within a setting.

The notion of information load is directly related to concerns about

whether consumers can be given too much information in virtual shopping
environments. Compared with conventional retail shopping, computer
shopping enriches the information environment of virtual shopping by
providing additional product information, such as comparative products
and services, as well as various alternatives and attributes of each
alternative, etc.

Pros and Cons of e-shopping in Bangladeshs Context

Prospects and challenges of e-shopping in Bangladesh stem from its
advantages and disadvantages. Principal advantage of e-shopping is that
the process enables buyers and sellers to do business without any
physical interaction. This alone is a great advantage considering the
hassle one has to go through to go to shop to pick up his or needed
merchandise. Online marketplace thus can save great amount of time for
consumers making their life a lot easier. Following is some brief
advantages and disadvantages of e-shopping that can be applied from
Bangladeshs perspective.
Advantages
Convenience
Online stores are usually available 24 hours a day and a visit to a
conventional retail store requires travel and given the current traffic
situation in BD the whole process eats up considerable amount of peoples
precious time. Thus Peoples need to save some of their valuable time can
be exploited by the e-shopping industry.
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. 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. Some
stores even allow customers to comment or rate their items. There are
also dedicated review sites that host user reviews for different products. 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.
Price and selection
One advantage of shopping online is being able to quickly seek out deals
for items or services with many different vendors. 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. Another
major advantage for retailers is the ability to rapidly switch suppliers and
vendors without disrupting users' shopping experience. 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
Fraud and security concerns
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
credit cards or fraudulent repudiation of the online purchase. Computer
security has thus become a major concern for merchants and e-commerce
service providers, who deploy countermeasures such as firewalls and antivirus software to protect their networks. 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.
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.
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.
Privacy
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 tele-marketing 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.
Product suitability

Not all products are equally suitable for e-shopping rather products that
are less suitable for e-commerce include products that have a low valueto-weight ratio, products that have a smell, taste, or touch component,
products that need trial fittings, most notably clothing, and products
where color integrity appears important.
Accessibility
In Bangladeshs context access to internet is a major concern for eshopping businesses as a large portion of the countrys population is still
out of the reach of internet service. This event significantly hampers eshopping operations as it considerably minimizes target market.

Various e-shopping Models

In order to cope with the present world, almost all of the financial
organizations and international businesses in Bangladesh enter in the
information highway through hosting website. Banks and other financial
organizations have started online transactions like fund transfer, payment
etc.
Various models of e-shopping can be categorized into four different
groups:
-

Business to Consumer (B2C)

Consumer to consumer (C2C)

Business to Business (B2B)

Consumer to Business (C2B)

Now lets have a comparative analysis of those models and to assess the
situation in Bangladesh.

Business to Consumer (B2C)

B2C can also be referred as retail and it is termed as the sale of goods and
services from businesses to the end-user. Many of the organization we
investigated will fall under this category. Being business organization
these institute can afford to have slightly greater advantage over C2C
category in some areas such as finance, communication network.
Consumer to consumer (C2C)
Consumer-to-consumer

(C2C)

electronic

commerce

involves

the

electronically facilitated transactions between consumers through some

third party. A common example is the online auction, in which a consumer
posts an item for sale and other consumers bid to purchase it; the third
party generally charges a flat fee or commission. The sites are only
intermediaries, just there to match consumers. They do not have to check
quality of the products being offered. This model of e-shopping is probably
most commonly found in Bangladesh. ClickBD.com, cellbazaar etc. will fall
under this category. They have few advantages in business operations
such as they dont accept responsibility for faulty products etc.
Business to Business (B2B) and Consumer to Business (C2B)
Business-to-business (B2B) describes commerce transactions between
businesses, such as between a manufacturer and a wholesaler, or
between a wholesaler and a retailer. Contrasting terms are business-toconsumer (B2C) and business-to-government (B2G).
On the other hand consumer-to-business (C2B) is a business model in
which consumers create value, and firms consume this value.
These two types of e-shopping models are yet not that much prevalent in
Bangladesh yet. There might some problem related to infrastructure or
may be businesses are yet not ready to accept considerable amount of
product or services via these two particulars models.

Analysis Part
So far we have talked about various theoretical aspects of our research.
Now lets have a look at the analysis that we have accomplished to
achieve the stated objectives of the report.
In the first segment we have analyzed the demographics, preference of
product array and general perception of the respondents. Following is
presented the detailed part of the relevant analysis.
Demographics
Income level:
Income of individuals
Cumulative
Frequency
Valid

< 5000

Valid Percent

Percent

16.1

16.7

16.7

5000 - 10000

11

35.5

36.7

53.3

10000 - 25000

22.6

23.3

76.7

25000+

22.6

23.3

100.0

30

96.8

100.0

3.2

31

100.0

Total
Missing

Percent

System

Total

Income Level of Consumers

< 5000
23%

17%

5000 - 10000
10000 - 25000

23%

37%

25000+

This information is quite important for this research on e-shopping

because potential involvement in e-shopping may depend on income

structure. Here we see people of income level 10,000 Tk and onwards are
mostly involved in e-shopping. However, students alone, having income
level 5,000 10,000 Tk constitute a vast portion of e-shopping consumer
base.
Age Distribution:
Age range of customers
Cumulative
Frequency
Valid

Missing

Percent

Valid Percent

Percent

18-25

10

32.3

33.3

33.3

26-35

29.0

30.0

63.3

36-45

25.8

26.7

90.0

46+

9.7

10.0

100.0

Total

30

96.8

100.0

3.2

31

100.0

System

Total

Age Distribution by %
35
30
25
20
15
10
5
0

18-25

26-35

36-45

46+

As the graph shows majority of the respondents are from 18-25 years of
age. So as the sample suggests the majority of the buyers of online
shopping will fall under that particular category of age.
Profession:

Profession of Consumer
Cumulative
Frequency
Valid

Student

Valid Percent

Percent

10

32.3

33.3

33.3

Service Person

22.6

23.3

56.7

Business Professional

29.0

30.0

86.7

Others

12.9

13.3

100.0

30

96.8

100.0

3.2

31

100.0

Total
Missing

Percent

System

Total

Profession Distribution
13%

33%

30%
23%

As we see, the professional segmentation reveals that, mass number of eshopping consumers is students. An insight reveals that these are college
going students with net savvy lifestyle and a steady pocket money source.
Business and service people also consume significantly. Other occupations
may include medical professionals, freelancers etc.
Preference of Product Array/ Types of products:

Product Array
Clothes
13%

23%

23%
40%

Gadgets
Service
products
Others

As we see, majority of online customers consume electronic gadgets. The

demand for clothes is also remarkable.
General perception about obstacle in e-shopping prospects:

Common percetion about obstacle

Cost of delivery; 17%
Online transaction insecurity;
23%connectivity; 20%
Irregularnet
Physical judgement impossibility; 40%

Physical judgment impossibility has been given considerable importance

as an obstacle by many of the respondents. So, based on this sample data
we can state that peoples perception regarding physical judgment
impossibility is a significant obstacle in the path e-shopping growth in
Bangladesh.
Sample Selection
To select the sample we have used non-probabilistic sampling method and
which is convenient sample. A sample size of 30 was used to conduct the
research on the consumer segment. Also, a sample of 12 e-shopping

service providers was also taken into account to analyze the commercial
perspective.
Measurement of Variables
For dependent variable we have 2 items in 2 models. And for independent
variable, we had 9. Reliability and internal consistency of the multi item
scales for each of the constructs were measured using Coefficient Alpha.
And finally we use R2 value to determine how much our independent
variable can explain the dependent variable.
Reliability Coefficients(Overall)
N of Cases =
Alpha =

30.0

N of Items = 15

.5381

First, we will analyze reliability of the variables in the Prospect model

Dimension

Number of
Items
1

Alpha Values

Security Concern
(independent)
Availability and Diversity
(independent)
Entrepreneurs
interest/incentives
(independent)
Infrastructure (Independent)

.229

.155

.230

.281

Prospects (Dependent)

.207

Convenience (independent)

.322

Interpretation
The reliability test of dependent variable for all the variables has been
extracted from the reliability analysis. From the previous exploratory
research the alpha stands to be .5381, which means that all the
independent variables had an internal consistency of 53.81% among each
other. Again individually from the column alpha if item deleted we can see

that all the independent variables are below 0.5 and so there will be
drastic significant change if any of the independent variables are deleted.
Now, for the Challenge model
Dimension
Customer
receptiveness/Preference over
others (independent)
Product Quality (independent)

Number of
Items
1

Alpha Values

.207

.155

.379

.302

Product delivery
(independent)
Lack of legislation and
incentives (independent)
Challenges (Dependent)

.221

Interpretation
Again individually from the column alpha if item deleted we can see that
all the independent variables are below 0.5 and so there will be drastic
significant changes if any of the independent variables are deleted.

Data Analysais Result & Findings

Analysais Techniques
Once the reliability analysis was done, we calculated the mean value of
dependent variables and independent variables. Finally, we completed the
analysis part through regression analysis.
Hypothesis Testing
In this section, we will test the corresponding hypotheses of respective
regression models.
In case of the Prospect model, the null hypotheses can be put as:

1 Ho:

Positive

prospects

on

e-shopping

does

not

depend

on

convenience.
H1: Positive prospects on e-shopping depends on convenience.
2 Ho: Positive prospects on e-shopping does not depend on security
concerns.
H1: Positive prospects on e-shopping depends on security concerns.
3 Ho: Positive prospects on e-shopping does not depend on availability
& diversity.
H1: Positive prospects on e-shopping does depend on availability &
diversity.
4 Ho:

Positive

prospects

on

e-shopping

does

not

depend

on

entrepreneurs interest aka incentives.

H1: Positive prospects on e-shopping does depend on entrepreneurs
interest aka incentives.
5 Ho:

Positive

prospects

on

e-shopping

does

not

depend

on

infrastructure.
H1: Positive prospects on e-shopping does depend on infrastructure.
The findings from multiple regression analysis are listed as follows:
Independent Variables

Standardized

t value

()
Convenience
.328
Security concern
.238
Product availability & .189

1.603
1.120
.918

.012
.027
.046

diversity
Entrepreneurs interest .001

.020

.135

and incentives
Infrastructure

.536

.031

Regression Coefficient

.110

The observed table shows that all the variables have significant values
indicating major implications of these factors on e-shopping prospects.
And as we can see that only P value of Entrepreneurs interest & incentives
(.135) is larger than 0.05 and we know a p-value less than 0.05 would
result

in

the

rejection

of

the

null

hypothesis

at

the

5%

(significance) level. So, in this case Ho null hypothesis is not

rejected which is positive prospects of e-shopping does not depend on
entrepreneurs interest and incentives.
Other fact such as convenience, security concerns etc. have significant
influence on the prospect of e-shopping in Bangladesh. So clearly in order
to improve the situation people concerned need to take other factors into
consideration and modify them so that prospect of the sector is enhanced.
In case of the Challenges model, the null hypotheses can be put as:
1 Ho: Challenges in e-shopping is not motivated by Customer
receptiveness.
H1:

Challenges

in

e-shopping

is

motivated

by

Customer

receptiveness.
2 Ho: Challenges in e-shopping is not motivated by Consumers
suspicion over product quality.
H1: Challenges in e-shopping is motivated by Consumers suspicion
over product quality.
3 Ho: Challenges in e-shopping is not motivated by Difficulty in
product delivery.
H1: Challenges in e-shopping is motivated by Difficulty in product
delivery.
4 Ho: Challenges in e-shopping is not motivated by Lack of
government financial incentives.
H1: Challenges in e-shopping is motivated by Lack of government
financial incentives.

The findings from multiple regression analysis are listed as follows:

Independent Variables

Standardized
Regression Coefficient
()

t value

Customer
receptiveness

.327

1.789

.0078

Suspicion over
product quality

.180

.878

.0368

Difficulty in product
delivery

.255

1.283

.024

Lack of government
financial incentives

.177

.958

.0895

The observed table shows that all the variables have significant values
indicating major implications of these factors on e-shopping prospects.
And as we can see that only P value of Lack of government financial
incentives (.0895) is larger than 0.05 and we know a p-value less than
0.05 would result in the rejection of the null hypothesis at the 5%
(significance) level. So, in this case Ho null hypothesis is not
rejected which is challenges of e-shopping is not influenced by lack of
government incentives.
However, all other variables do have substantial impact on the challenges
faced by e-shopping in our country. So to mitigate challenges factors such
as suspicion over product quality, difficulty in product delivery etc. have to
give prime importance. They need to be minimized as much as possible to
ensure smooth business operation of e-shopping.

Regression Analysis
Model Summary (Prospects)

Model

R Square

Adjusted R
Square

Std. Error of the

Estimate

.636

.824

.361

.38

From the regression analysis, we have found that the Value of R Square is
(.824). That means independent variables have 82.4% impact over the
dependent variable. In other words, the dependent variable (Prospects in
e-shopping) can be influenced 82.4% by the independent variable
(Convenience, Security, Availability & Diversity, Entrepreneurs interest
and Infrastructure).
So, it means we can judge the impact of dependent variables on the
independent variable with up to 82.4% accuracy. The rate of accuracy is
quite good and it would help us to how prospect of e-shopping will be
affected for a certain change in any of the significant factors such as,
perceived

convenience,

product

availability

and

diversity,

security

concerns etc. To enhance prospects of e-shopping the model can be used

to determine how much change in the stated factors is needed to enhance
the prospect to some considerable degree.
Model Summary (Challenges)
Model

R Square

Adjusted R
Square

Std. Error of the

Estimate

.492

.842

.317

.41

From the regression analysis, we have found that the Value of R Square is
(.842). That means independent variables have 84.2% impact over the
dependent variable. In other words, the dependent variable (Challenges in
e-shopping) can be influenced 84.2% by the independent variable
(Customer receptiveness, Suspicion over product quality, Difficulty in
product delivery, Lack of government financial incentive).
Thus the figure suggests that we assess the impact of a change of
independent variable on the dependent variable with about 84% accuracy.

So, this model can be used to determine the change in the level of
challenges faced by e-shopping given that any of the stated factors are
changed. In this way the model can be used to mitigate challenges in an
effective and efficient way.

Recommendations
So far we have gone through various analyses regarding the prospects
and challenges of e-shopping. Based on our analyses we have some
recommendation to make which we believe will enhance the over scenario
of e-shopping sector in Bangladesh.
-

Perceived convenience of e-shopping has to be enhanced.

Security issues have to minimized as much as possible to ensure

smooth and continuous business transaction.

Product diversity and availability have to be increased.

Infrastructural

development

is

needed

such

as,

internet

connectivity, access to banking services etc.

-

Customers suspicion regarding product quality has to be mitigated

as much as possible.

Overall customer receptiveness has to be increased if e-shopping is

to flourish in our country. This can be done through various effective
marketing campaign and substantial advertisement.

Conclusion
Despite all of the disadvantages and challenges it has been found from
various papers and also from our analyses that e-shopping is a growing

sector in Bangladesh and has lots of potential. Peoples interest to have a

hassle free shopping is the prime driving force of its prospects. Lots of
infrastructural development is needed to be done to make e-shopping a
routine activity for many of the countrys citizens as advised by some of
the authors. Both government and private sector initiatives are needed to
make sure sustainable growth in this sector.