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Acknowledgement
The researcher would like to acknowledge the following people who have given
much of their time and effort in helping the researcher to conduct the study.
To the research instructor, adviser, and editor Mrs. Luzviminda N. Ates, PhD for
the recommendation and support in conducting the study.
To the respondents, for answering the questionnaire patiently and with all
honesty.
To our families, and friends, who provided the advice, and especially to our
parents who showed moral and financial support throughout the study.
To the almighty God, who made all this possible through His divine, providence,
guidance and knowledge that the researches needed to make this study possible.
Abstract
Internet makes life simple and innovative. People are doing business online and trade
has become more easy and fast due to this. According to Barry Silvestre, 2002,(p.3),
Internet provides new ways to promote business. Website becomes the essence of
online business as to show their services and products. This study entitles Factors
Influencing Consumer Buying Behavior towards Online Shopping aims to determine the
frequency purchased items through online shopping of students of Holy Cross of Davao
College and which among the frequency influence them to buy and purchased product
online. In getting the right data, the researchers used the quantitative method
particularly the descriptive research method to draw the factors that influence
consumers to shop online. Using stratified sampling technique, 100 students of different
courses were chosen to participate in the survey. After which data will be carefully
examined by using the mean and Pearson-r.
Page
Title Page
Approval Sheet
ii
Acknowledgement
iii
Abstract
iv
Table of Contents
List of Tables
vi
List of Figures
vii
CHAPTER
1
Theoretical/Conceptual Framework
Hypothesis
2
Method
Research Design
Research Environment
Research Instrument
References
10
CHAPTER 1
people of Pakistan do avoid putting their financial information such as bank information
and credit card information to avoid frauds and stealing identity. Therefore, in order to
avoid thus and hesitate to send money online before physical inspection. One more
reason is that the bank support and other convenient system like PayPal that is not
available. Due to this, entrepreneur are losing 20% to 25% business (Pakistan Today,
2011).
More and more Filipinos are beginning to shop online, according to the results of
MasterCards Online Shopping Behavior study (2012) in Asia Pacific countries. The
survey also shows that the country's e-commerce potential is expected to grow even
more with the emergence on enabling technologies.
In general, the Filipino shoppers are cautious in making online purchase with
most of the respondents (89%) citing security as a top concern, closely followed by
speed of transaction (88.5%) convenience of payment method (88.5%) in their
transactions. Other factors considered important by 80% of the respondents are
price/values, return or exchange policy, website reputation, online review, customer
service, low delivery change, and use on various payment methods.
The online shopping is getting popular among the young generation as they feel
it more comfortable, time saving and convenient. Online shopping is the consumers
shopping behavior to shop online. The people find it easy to use, useful and enjoyable
can accept online shopping. Online shopping has experienced a rapid growth during the
recent years due to its unique advantages for both consumers and retailers, such as
shopping at round the clock facilities, decreasing dependence to store visits, travel cost,
increasing market area, decreasing overhead expenses and offering a wide range of
products. Online shopping has been shown to provide more satisfaction to modern
consumers seeking convenience and speed. On the other hand, some consumers still
feel uncomfortable to buy online. Also, consumers may have a need to and feel the
products and to meet friends and get some more comments about the product before
purchasing. Such factors have negative influence on consumer decision to shop online.
The Objective of the researcher of this study was to be able to know the
frequency purchased items of the students of Holy Cross of Davao College Inc., and
their shopping behavior through online shopping.
Through this the researcher would like to have an output to measure the Factors
Influencing Consumer Buying Behavior of online shoppers and its frequency purchased
items. The beneficiary of this research will be those people who are planning to shop
online and for those people who have gone shopping online and keep on buying items
online.
Online shopping is a process in which to buy goods or services through the internet.
With large of consumer using internet for online shopping, it is not clear what drives
them to shop online and the statics regarding consumer behavior towards online
shopping in the Malaysian environment is still limited number. So we need to know what
the factors that influence of the consumer behavior through online shopping. Nowadays,
online stores grow up so fast through social media such as, face book, Instagram, blog,
website and other social media. The seller can sell or promote their product or services
that they need to offer to consumers via online.
Malaysian consumer believe, with online shopping, is not time consuming and online
shopping would make their life easier. They are also concerned about privacy, trust and
disclosing personal information when dealing with online shopping (Fadilah and Ahmed
2015).
According to (George Belch and Michael Bech) Marketing to consumers via the internet
has many advantages for marketers. It allows products services to be offered 24 hours
a day, 7 days a week, 365 days a year, it allows products and services to be offered
globally in an efficient manners, it is cost efficient in that it saves the need for stores,
paper, catalogs and salespeople. It provides a month for developing one-on-one
relationship with consumers and establishing consumer databases for conducting online
research. Online business to consumer marketing requires marketers to understand
consumer and deliver the products and services consumer wants and need, just as
traditional marketing does. In 2009, marketers proved their ability to serve consumers
continue to grow faster than any other form of retailing. Although the e-commerce
shakeout in the early 2000s led many analyst to declare that the internet was overhype
as a marketing tool, it is now firmly established as a critical element of overall marketing
strategy.
One major criticism of online marketing is that it reaches only a small segment of the
population. However, research shows shoppers reflected similar gender relations and
income levels as the population as a whole in the United States. ACNielsen research
found more than 143 million U.S household to be action home internet users, along with
32 million in Germany and 23 million in the United Kingdom. Thus, internet marketers
would seem to be able to reach a broad market, if they are use appropriate strategies to
do so (page 7).
A second major criticism of online marketing is that consumers shop on the way to
collect information about products and services but do not buy. Analyst thought that
consumer preference to shop in person at stores and did not want to risk giving hackers
access to credit card or personal information sent online. However, recent researchers
found that two-thirds of shoppers with internet access actually made a purchase online.
Apparently, improved security or the web has assured the fears of many online
shoppers (page 10).
Online shopping is more accessible than it has ever been in the digital era with the
introduction of Tablets, smartphones, easy checked systems and more secure systems.
As a result, the e-commerce industry is generating higher sales volume.
According to Forrester research the online retail sales volume for the US in 2012 is 232
billion dollar. This figure is predicted to grow continually to 370 billion dollar in 2018.
Forrester also reports that 53% of people in the U.S shopped online in 2011 and it is
predicted to grow to 58% in 2016. Assuming the online shoppers are above 15 years
old, the majority of the U.S population above 15 years, 66% shopped online in 2011.
According to Experian Simmons, drawing from a pool of 4,887 online shoppers, the 25
to 50 year-old age bracket make us 65.7% of online shopper, of which 59.1% are
female, 57.3% of online shoppers have an annual household income above 50,000 and
77.9% have education level are some college or higher.
According to cons core, the top-performing online categories are digital contract and
subscription, consumer Electronic, Flowers, Greetings and gifts, computer hardware
and apparel and accessories.
The internet has played a significant role in our daily life in that people can talk through
the internet to one who is actually on the other side of the Earth, can send email around
the clock, can search information, can pay game with others, and even can buy thing
online. Meanwhile, internet shopping has been widely accepted as a way of purchasing
products and services. It has become a more popular means in the internet world
(Bouyr lakis et al., 2008). Online shopping has been shown to provide more information
and choices to compare product and prices, more choice. Convenience, easier to find
anything online.(Butler and Peppard,1998). Online shopping has been shown to provide
more satisfaction to modern consumers seeking convenience and speed (Yu and Wu,
2007). On the other hand, some consumers still feel uncomfortable to buy online. Lack
of trust, for instance, seems to be the major reason that impedes consumer to buy
online. Also, consumers may have a need to examine and feel the products and to meet
friends and get some comments about the products before purchasing. Such factors
may have negative influence consumer decision to shop online.
Buyers behavior when making a purchase- their attention is drawn to a problem which
then sparks their interest, creates a desire and they take action to meet their desire.
According to (Mcgovern, 20020, suggests that there are four types of user that that
might arrive on a website. Mcgovern presents his list of users in the context of Web
designer needing to cater for each- and it reflects his commercial outlook9rather than
Barbes wore academic appraisal) that he considers all but one of the groups to be
potential customers/prospects. The first are the perfect prospects people who know
what they want, and so many well take an action that help meet its objection(a
purchase, for example). The second group of prospect is sort of know what they want
anything, but are not sure. Third are the prospects that arent even sure if they want
anything, but would but buy something if the right product came along. The fourth group
is the only one not male up of prospects and that is because its members have arrival
on your website by mistake. It is the;latest that is the only group that can be ignored
when developing a website.
Online shopping behavior (also called online buying behavior and internet shopping/
buying behavior) refers to the process of purchasing products or services via the
internet. The process consists of five similar to those associated with traditional
shopping behavior (Liang and Lai 2000). In the typical online shopping process when
potential consumers recognize need for some merchandise or service, they go to the
internet and search for need-related information. However, rather than searching
stores collected data on customer movement through a single store accordingly. Also,
purchases and expenditure data was gathered on consumers purchasing from multiple
stores-usually long after the purchases were made and the data was used to target
direct mail and in store campaigns, in addition to mass-media advertising.
The online advertising networks such as DoubleClick and 24/7 Real Media have added
several new dimension to established offline marketing techniques. First, they have the
ability to precisely track not just consumer purchases, but all browsing behavior on the
web at thousands of the most popular member sites, including browsing book lists,
filling out preference forms, and viewing content pages. Second, they can dynamically
adjust what the shopper sees on screen including prices. Third, they can build and
continually refresh high resolution data images or behavioral profiles of consumers.
Other advertising firms have credited spyware software that, when placed on a
consumers computer, can report back to the advertisers server on all consumer internet
use and is also used to display advertising on the consumers computer.
Attitudes towards online shopping consumers attitudes toward online shopping have
gained a great deal attention in the empirical literature with 22 out of 35 papers focusing
on it. Consistent with the literature and models of change and behavior (e.g, Fishbein
and Ajzen 1975) it is believed that consumer attitudes will effect intention to shop online
and eventually whether a transaction is made this is a multidimensional construct that
has been conceptualized in several different ways in the existing literature. First, it
refers to the consumers acceptance of the internet as a shopping channel (Jahng et
al.2001). Secondly, it refers to consumer attitudes toward a specific internet store (i.e ,
to what extent consumers think that shopping at this store is appealing) these first two
dimensions are negatively associated with the third, consumers perceived risk.
According to Lee and colleagues (2001) two main categories of perceived risk emerge
in the process of online shopping. The first is the perceived risk associated with product/
service and includes functional loss, financial loss , time loss, opportunity less , and
product risk. The second is the perceived risk associated with context of online
transactions and includes risk of privacy, security is significant (Senekal 2000,
Bochers2001, Bhavnagar et. Al 2002). However, the fourth dimension of attitudes,
consumers trust in the stores, can reduce perceived risk. In additional, perceived
control/ users empowerment, enjoyment/playfulness and perceived real added value
from membership have also been shown to important dimensions of consumers .
The owner of the business should be responsible for protective the customers. You can
prevent your customers from being victim of identity theft & fraud and stay in business
yourself being vigilant about the credit card payment you accept & keeping your
customers information as private as possible.
There are several activities included in the consumer behavior. Obtaining refers to the
activities leading up to and including the purchase/receipt as a product. Some of the
activities include searching for information regarding consumer buying behavior analysis
examine these types of behavior, including how store alternatives, and how brands
influence their product choices. Consumer refers to how where, when and under what
circumstances consumers use products. Disposing includes how consumers get rid of
product and packaging consumer analysis night examine consumer behavioral from an
ecological standpoint.
Li and Zhang (2008) have defined online buying behavior or internet shopping/ buying
behavior as the process of purchasing products of services via the internet which
according to Liang (2000) as a similar to the traditional fine steps process of consumer
buying behavior ( as cited by li and Zang 2000). They have also defined online shopping
attitude as the psychological state of the consumers in terms of internet shopping li and
Zhang analyzed 35 empirical studies on online shopping attitudes and behavior
conducted during the period of January 1998 to February 2002 and have online
identified 10 interrelated factors for which the reviewed studies have significantly
empirical
evidence.
These
10
factors
(environment,
demographic,
external,
Hoffman and Novak(1996) indicated that interactivity is the key distinguishing feature
between marketing communication on the internet and traditional mass media. Online
customers have more control and bargaining power than the consumers and physical
stores because the internet offered more interactivities between consumers and
product/service providers as well as greater availability of information about product and
services. The higher the perceived experience risk the consumers may shift to brick and
mortal retailer for the purchase of the product. Whereas, the lower the perceived risk the
higher the prosperity for online shopping.
Electronic commerce has become one of the essential characteristics in the internet
era. According to CELA (Center for communication policy 2001), online shopping has
become the third most popular Internet activity, immediately following email using
internet messaging and Web browsing. It is ever more popular than seeking out
entertainment information and news, commonly thought of activities when considering
what internet users do when online. Of internet users, 48.9 made online purchase in
2001, with three-quarters of purchases indicating that they make 1-10 purchase per
year. When segmented into very versus less experienced internet users, the very
experienced users average 20 online purchases per year, as compared to four annual
purchase for new users.
In the Philippines, e-commerce is mostly being implemented by major retailers and
multinational corporations for bank-to-bank exchange. A number of Business-toconsumer transactions have emerged through the years such as auctions, online
shopping, and online banking (Lacson, Pasadilla, 2006). This just shows that Filipino
businesses welcome this new opportunity in selling goods since 16% of the population
is using Internet. This new marketing strategy will not only benefit those big companies
but also the small businesses who cannot afford to advertise their products. Just by
creating a website in a very affordable cost would make the business grow in terms of
sales and enhance the company image as well.
Philippine firms have yet to fully tap the potentials of e-commerce that will help them to
compete in domestic and global markets. In the process of preparing themselves to
conduct e-commerce, these firms will be changing the way they do business. These
changes are expected to have an impact on the welfare of Philippine workers. Most
efforts to measure the economic effects of e-commerceincluding those on workers
welfarehave focused on the U.S. and Europe, who are considered to be the leaders in
e-commerce. (Roberto, 2002) In general, it discuss the changes in the nature of work
from the front to back office is likely within the sectors performing services Employment
demand for these industry, they may be focused away from agents and blue collared
workers, toward higher management and executive staff.
As Filipinos entered the 21st century, local e-commerce transaction reached Php 1
billion. It shows that theres at least one billion transaction sales growth annually. If this
trend continues, figures can reach up to Php 20 billion as more businesses conduct
online transactions. If significant economic growth takes place in the next 10 years,
these estimates may even double or triple (Toral, 2004). One indisputable benefit of
e-commerce is its ability to reduce transaction costs. For consumers or buyers, this is
most likely to take the form of lower search costs and better information on products
and prices. There could be drastic savings in production and delivery costs of electronic
or digital goods as well. (Lee, 2006). Information and Communication Technology (ICT)
has become and will continue to be an integral part of the day-to-day life of every
Filipino across all levels of our society. The occurrence of communication technology
around the world necessitates that government get on a cohesive and coordinated
strategy on how to prepare its citizens to survive, live and thrive in a digital world. (The
Philippine Digital Strategy Transformation 2.0: Digital Empowered Nation 2011) The
main objective of the paper is to have a competitive society where everyone has a
reliable, affordable and secure information access in the Philippines.
According to (Bravo, 2013), Davao City is still a cash society, far from the global trend of
card economy. Tjader P. Regis, marketing director of NCCC Group of Companies,
revealed that Davao remains a cash economy with only around 20 percent of
consumers engaged regularly in card transactions. The NCCC Group of Companies
runs such retail chains as the NCCC Mall Davao, Choice Supermarket and HB1.
Despite the trend in global commerce, Davao has not yet reached the level where it has
accepted the use of cards and electronic transaction platforms according to Regis. Its
still 80-20 (cash to card ratio), said Regis during the official announcement of the
NCCC-EC Pay-GATE Distribution partnership on Thursday. Among the contributory
factors for Davao economy being cash-based are largely due to the attitude of
Dabawenyos to shop with cash and the limited accessibility to credit card subscription
due to the stringent screening process
Banks put premium on card approvals. The low penetration rate, however, still reflects
the current low penetration rate of e-commerce in the Philippines which is presently at 3
percent. Market analysts, nevertheless, foresee things to change with the current
tremendous growth of internet usage in the country. The increase in internet usage is
felt more noticeably in electronic transactions. Regis said more Dabawenyos use
electronic transactions in paying their bills. Utilities like electricity, telecommunications,
and cable television are among the top transactions using electronic payments.
Likewise, mobile phone e-loading top ups and e-wallet loading are also among top epayment transactions which have found their way into the lifestyle of Dabawenyos.
Raymund Jude Aguilar, president of Electronic Commerce Payments Inc. (ECPay), said
90 percent of the electronic transactions of ECPay in Davao City are power bill
payments. ECPay, according to Aguilar, was designed to make payments and
collections efficient and convenient to both merchants and customers alike. Developed
in 2001, the ECPay multi-platform payment infrastructure operates as a secure ewarehouse and e-payments data center for prepaid products, bills payments, airline
ticket payments, online shopping transaction payments, e-wallet, fund transfers, and
domestic remittance. It enables merchants and retain outlets to offer accurate, secure
and timely payment services to their customers while providing merchant clients with
real time electronic reconciliation, web-based reporting and system management,
Aguilar said. Despite the low acceptance for the revolutionary card economy, Regis said
NCCC is still bent on venturing the untraveled waters. For starters, the NCCC Mall will
be introducing online shopping on limited product lines We will be moving into online
shopping but on selected products only.
Online shopping in the Philippines has been noted to begin to flourish. Among the noted
online shopping gateway is Lazada Philippines which is now the countrys leading one-
stop online shop after only a year of operations. We have studied the growth and
acceptance of online shopping and we feel its time to venture into the market, said
Regis. However, Regis cautioned some products are better off sold on the rack where
customers are more at home with touch and feel shopping. For example, when
buying furnitures or beds, people would prefer that they get a feel before buying, he
explained. Online shopping may be good for some items, Regis said, but they still wish
people would come to the mall to shop the old-school way.
NCCC Mall has an average daily foot traffic of 50,000 which is a mere one-third of the
average unique visits Lazada has online. A market research revealed that five out of six
consumers who use the internet to research a specific product they want actually buy
the product offline. This means they are basically using the internet only as a research
tool and do not complete the online experience, which is the actual sale.
Its a matter of selling the idea to people, Regis said.
The researchers identified two variables in the stud; The factors Influencing Consumer
Buying Behavior towards Online Shopping such as Personal Factors, Psychological
Factors, Social Factors and Cultural Factors. In which the Factors are respondents
Independent Variables and among the Factors which Influence affect the buying
behavior of online shoppers are the Dependent Variables.
Factors Influencing
Consumer Buying
Behavior
Independent Variables
Dependent Variables
CHAPTER 2
Method
Research Design
This study will use quantitative method of research. Particularly the descriptive
research method to draw the factors that influence consumers to shop online.
Data to be
gathered
Respondents
Tools to be
gathered data
Techniques
to analyzed
data
Output
of the
study
Aspect of online
shoppers on
consumable products
items of:
a. Personal Aspects
b. Psychological
Aspects
c. Social Aspects
d. Cultural Aspects
40
respondents
Survey
questionnaire
Respondent preference
in buying online
Research Environment
The study was conducted at Holy Cross of Davao College, Sta. Ana Avenue,
Davao City. It is a private and Research Catholic College founded by the Religious of
the Virgin Mary sisters. It is presently supervised by the Roman Catholic Bishop of
Davao (as a corporate sole). The school is governed by the board of trustees whose
members do not receive any compensation.
The reason why we select Holy Cross of Davao College is that the students is
mostly belong to adolescent and teenage group which is more involve of the trends,
fashion and peer. The students are likely fascinated on online shopping for they want to
purchase items that is quality, fashionable at a reasonable price. They also seek
convenience and easy access when purchasing online.
Research instrument
The researcher used questionnaire as a tool to conduct a survey from
respondents. It consist a series of questions as a way of gathering information for the
Factors that Influence Consumer Buying Behavior towards Online Shopping. The
questionnaire includes; Personal factors, Psychological factors, Social factors, Cultural
factors that Influence Consumer Buying Behavior through Online Shopping. It also
includes the frequency purchase items of the consumer through Online Shopping.
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