What Motivates or Demotivates Customers to Online Shopping - Essay Example

?What motivates or de-motivates s to online shopping Dissertation Proposal Introduction As the trend of the one line shopping continues, there appears to be a need to study the motivating factors that attract customers to this new shopping channel, the electronic commerce or e-commerce known today. E-commerce started the shift from the real market to a digital market wherein business is done through the internet and becomes an equal playing ground for buyers and sellers. Data from the U.S. Census (2011) shows the popularity of this marketing scheme, as in 2008 a total of $227,800million has been generated by e-commerce sales. This is an increase of 2.07 percent from 2007 e-commerce sale of $222,464m (See Annex 1) Statement of the problem. The aim of this dissertation is to examine the consumer behavior in explaining the motivations that attract customers to on line shopping. It is my contention that not everybody could be motivated into the growing interest of e-commerce. My objectives are twofold. First I would like to investigate the motivations of the middle and upper class segment of customers to buy on line as well as the reluctance of the lower class segment of the market. My research will also cover the fears of shopping on line to know if this becomes a mitigating for others not to take advantage of on line shopping. The implication of the research would show that knowledge of patronage motives would be important to retailers to understand the various influences which induce customers to purchase. Review of literature In this review of literature, I will present those theories, concepts and published literatures that in my opinion are most interesting and valuable for the purpose of this research. This will include the study of Electronic Commerce: Security Issues done by Matthew L. James on matters concerning electronic commerce and security risks involved in it. James figures out the rather slow regulatory and policy measures that shows pitfalls in implementation. For instance, James showed that Australia’s on-line security efforts appears to be befuddled, while that of US attempt to control encryption shows technical difficulty. James in this study, argued that e-commerce transaction is subject to interception, tracking, or attack, and as such there is a need to safeguard the users of the internet. He emphasizes the risk of unauthorized transaction from the third parties that may occur in fund transfers, smart cards and on line currency transactions. In a similar subject, Jay Van Varck (1997) discussed in study the real issues of e-commerce in today’s market. He discussed in his study the phenomenal growth of e-commerce but at the same time the pitfalls consumers may find they are in when using the website. He cited conditions wherein customers only see the merchandise in picture and spells out the difference of the real feel when one is in the mall. He stressed the fears of consumers on giving private information like credit cards and bank details for fear of being hacked and fraud. The study of Suki, Ahamd and Thyngarahan (2002, May 15) about the interest of Malaysians on internet shopping and their security concerns will be viewed to find if they are similar to the experiences of customers in my study. In this study, Malaysians are found to be avid users of internet and uses internet shopping for convenience. However, study found out security concerns that serve as barriers to continued use of online shopping. A definition of the term electronic commerce will be given and the type of internet transactions will be presented, as found in the website of (Digidsmith n.d.) A definition and type of transactions are deemed necessary for the study to know the classification of customers their uses and purposes of the internet shopping Reasons why people buy on line are identified in the study done by Gordon (2008 Sept. 29) wherein she outlined reasons why consumers prefer to buy on line. She emphasized in this study the comforts of shopping at home anytime of the day without having to dress up and endure the congestion of the traffic just to get t the mall. In this study, author also impressed upon his readers the disadvantages of the system that may stop on line shopping. Buying trends of the US market and the products they buy will be reviewed from the data of the US Census and Statistics to know growth and success of electronic commerce in the US perspectives (US Census Statistics. 2009) The statistics account for the sales growth of electronic commerce in the United States from the period 2008 and 2007. Data also shows the listing of commodities frequently purchased on line by consumers. In the order of their importance to consumers, drugs, health aids and beauty aids are the first items ordered through e-commerce. Next choice falls under other merchandise that includes jewelry, collectibles, souvenirs, auto parts and accessories, hardware, lawn and garden equipment and supplies. Clothing accessories, computer hardware are fourth choices and the least choices for e-commerce are the computer software and food, drinks and wine. Comparison of UK and US manner of shopping will be presented to examine e-commerce behavior in those countries. This will cover different factors in the decision making process and how the consumers interact with e-commerce brands. (Tornquist, S and Hird, Jake. 2010 July) This study looks at the demographics of US and UK particularly the ages of consumers that are attuned to electronic commerce purchasing. The impact of social media as discussed by Tornquist and Hird in this study has relevance to my research as there is likelihood of motivation coming from recommendations of friends in media. Stanton (1975, p.80-8) introduced determinants of buyer behavior wherein motivation is explained. To understand motivation, there is a need to know why a person acts at all, and to know its motives. Motives, according to Stanton are a stimulated need which is a goal-oriented individual seeks to satisfy (i.e. hunger, security and prestige). Author mentioned Maslow’s theory of motivation to know and understand the need at the different stages. In continuation, in another chapter of his book, Stanton acknowledges that there are other aspects that influences customer aside from the psychological frame of the individual; these include the cultural and social group determinants of buyer behavior. In cultural change, the changing role of women in the society is emphasized as women today is breaking from the traditional pattern of life. The times is changing such that people now recognizes desire for conformity, the importance of time, the increase of leisure time, convenience and upgraded tastes and desires for elegance. Author also mentioned the prevailing concern for the environment that significantly influences business marketing today. Since I have observed a defined difference of subcultures between the internet users, the definition in Stanton’s book of social class becomes relevant in my research. Stanton (p101) pointed to existence of social class structure in the U.S. that pertains to the upper, middle and lower class structure of society. Patronage motives have been discussed by Philipps & Duncan (1968,p. 65-70) in understanding the consumer motivation and behavior, wherein they classified it as being emotional and rational. On being emotional, consumers are encouraged to patronize a particular store or website with a minimum of thought as to the reasons for or against doing so. Accordingly, it has been stated also, that many people also buy after conscious reasoning as to which one they should patronize. Again, certain stores (or websites) are selected because of its over-all convenience to the consumer in terms of time, energy and money needed to purchase the good. Sometimes, these authors reported that consumers patronize a certain store (or website) because of the pride, pleasure it gives them when telling others about it, they have used reasoning in selecting the website channel. The need to define theories of motivation has been presented in the website of DCP , University of Florida. On this, the motivation theory of Maslow’s (hierarchy of needs) has been found to be relevant for discussions in research content of this study. Accordingly, Maslow’s theories encompasses the hierarchy of needs that fall into five stages, that are arranged as physiological (the lowest need) safety, social, self-esteem and self-actualization (the highest in the need order) The contention of Maslow’s theory is that in the hierarchy of needs, the lowest level of needs must first be satisfied before the next level appears. If the lower goal is not satisfied, other higher goals become weaker motivators. The implication of this theory to the research is that it is important to understand the level of needs that others have, and as resource information is identified, it becomes the root of developing effective marketing programs for the website business. Methodology I intend to use the qualitative method of research as this is a form of investigation process wherein there is a need to understand the complex realities posed in the research study. As outlined in the “Research Methods” this research follows the same guidelines that allows compiling of investigated cases that used informal research interviews. In this research study, I plan to gather studies, reviews, investigate cases that used informal research and interviews that are available on published journals, periodicals, books and internet sources and will be considered secondary data. The advantages I find in using this particular research method is that it can be used to explore issues, understand phenomena, and able to answer questions posed in the study. In this research, I will seek to find the answer to “why” and not to “how” through the analysis of unstructured form of information. I plan to gather this data from things like interview transcripts, notes, feedbacks and other published studies on the matter. Data will be collated to form a gathered insight into people’s attitude, behaviors, value systems, concerns, motivations, lifestyles or cultures. The information gathered will be useful for business decisions, policy formulations, communications and research. My approach in this research is evaluation and content analysis of all the materials gathered, as in-depth interviews could not be done, and this is considered as limitations of my research. Content analysis is a research tool that determines the presence of concepts within texts or set of texts. Afterwards, researcher quantify and analyze the presence, meanings and relationships of such words and make inferences about the messages within the texts (“An introduction to content analysis”) Texts referred here could be gathered from “books, book chapters, essays, interviews, discussions, newspaper headlines and articles, historical documents, speeches, conversations, advertising, theater, informal conversation, or really any occurrence of communicative language”. Particularly, questions to be answered in the research are: 1. Why do people buy from the internet? 2. Do they trust internet suppliers? 3. Will they entrust confidential information when asked in the websites 4. How do environments affect purchasing decisions in on line shopping? My model for discussing the determinants of buying behavior is based on the assumption that this behavior is goal oriented. The behavior is initiated when aroused, create interest, desire and action to satisfy the needs. This goal-seeking behavior is influenced by the individual’s perception of the alternatives open to him. His perceptions, in turn, are influenced by his learning experiences, attitudes and beliefs, personality traits self-image, by his environment and social factors. Access to data Data will be gathered from secondary sources publications that include textbooks, magazines, articles, histories, criticism, commentaries and encyclopedias. If data permits, I could use primary sources of information for this study that will include charters, correspondence, diaries, early works, interviews, manuscripts, personal narratives, sources, speeches and documents. Timetable This study will take an estimated twenty two days to prepare. Day one is the developing of research objectives, followed by a 2 days development of the research plan. The longest days in this research are devoted to the collection of data. A relatively longer period of time will be needed in case field research and on site interviews will be done if necessary. Preliminary analysis takes two days as this will involve checking and validity of data. It will also involve confirmation if data gathered is relevant or will add sense to the research. This is also the time wherein decision is needed on whether existing data is enough or is there a need to augment the data collection. The literature review is completed at this time. When analysis is completed, every part in the report is placed in its proper place and should take the format of dissertation. The completion of analysis takes two days. Finally, the final preparation for submission of the dissertation is done within 2 days. TIMETABLE ACTIVITY ESTIMATED TIMEFRAME Develop research objectives 2 days Develop research protocol 2 days Collect data 10 DAYS PRELIMINARY ANALYSIS 2 DAYS COMPLETE ANALYSIS 2 DAYS PREPARE DRAFTREPORT 2 DAYS FINAL DRAFT REPORT 2 DAYS Conclusion The problem that this dissertation proposal needs to address is to know the motivating factors why consumers prefer to buy from internet sources. It is construed in my proposal that aside from motivating reasons there are mitigating factors that consumers feel insecure in using the new shopping channel. An insight of these perceptions is proposed to be studied in this proposal. Findings of research would help policy makers to design strategies that would melt down these apprehensions of online consumers. Research design is exploratory and qualitative and limited to existing published information and will not use the structured questionnaire. Annex 1. E-commerce Sales in the United States Source: US Bureau of Census (2011 ) Preliminary source materials “An introduction to content analysis”. Writing @ csu. http://writing.colostate.edu/guides/research/content/pop2a.cfm Anaf, Sophie, and Shepphard, Loraine. 2007 June 02. Mixing research methods in health professional degrees: Thoughts fr undergraduate students and supervisors. Published in the Qualitative Report Vol. 12, No. 2, June 2007 184-192 Available in http://www.nova.edu/ssss/QR/QR12-2/anaf.pdf Digidtsmith. Ecommerce definition and types of e-commerce. (n.d.) http://www.digitsmith.com/ecommerce-definition.html Gordon, Wendy (2008 Sept. 10) Top reasons why people shop online. Behavioral Economics. The Tech FAQ. http://www.thetechfaq.com/2008/09/29/top-reasons-why-people-shop-online/ Jay Van Vark. (1997). eCommerce and the Security Myth. Issue No. 11, Vol. 13, 1997. MacTech. The Journal of Apple Technology. http://www.mactech.com/articles/mactech/Vol.13/13.11/eCommerceandSecurity/index.html James, Matthew L. 199 February 16. Electronic commerce” security issues. Research paper 12: 1998-1999. Parliament of Australia, Parliament Library file:///C:/Documents%20and%20Settings/All%20Users/Documents/99rp12.htm Mayoux, Linda. 2011 Jan. 05, Current trends in development research. http://www.lindaswebs.org.uk/Page3_Orglearning/Resmeth/ResMeth.htm “Motivation theories” http://web.dcp.ufl.edu/hinze/MOTIVATION%20THEORIES.htm http://web.dcp.ufl.edu/hinze/MOTIVATION%20THEORIES.htm Phillips, Charles F & Duncan, Delbert J. Patronage motives. Marketing Principles & Methods. 1968. Richard D. Irfwin, Inc. Homewod, Ill. 6th ed. 1968, pp. 65-70 Stanton, William, Jr. Markets: Psychological determinants of buyer behavior. Fundamentals of Marketing, McGraw-Hill Book Company, New York, N.Y. USA, 1975, pp. 80-88 Stefan Tornquist and Jake Hird, Econsultancy, July 2010 How We Shop in 2010: Habits and Motivations of Consumers http://econsultancy.com/us/reports/habits-and-motivations-of-consumers Suki, Norazah Bte Mohd, Ahamd, Mohd Ismael and Thyngarahan, Venu (2002, May 15) Motivation and concern factors for internet shopping: a Malaysian perspective. http://www.ejeta.org/second-issue/ejeta-2002.05.14.04.09.49.pdf U.S. Census Bureau. 2011. Electronic shopping and mail order houses. Statistical abstract of the United States. Table 1055. http://www.census.gov/compendia/statab/2011/tables/11s1055.pdf Read More