Online Grocery Shopping - Essay Example

?Online Grocery Shopping Marketing management is a major component of business management. To remain at a competitive edge in the 21st century, businesses have to make their customers the focus of all their activities. Marketing task helps businesses achieve customer focus through identification, satisfaction, and retention of the customer. It is inevitable for businesses that want to increase their margins to shift their focus from the norms and beef up perceived needs and wants of their customers. In addition to businesses understanding their target markets, they have to define the means of delivering desired satisfactions to their customers and perform it better that other competitors. With the age of growing technology and internet popularity, marketing has become easier because customers have an opportunity to post reviews about products and have others access it before making decisions. Companies can use the reviews to improve their products and develop others that match customer’s needs. As a marketing manager of Miou Company Ltd, I will examine literature review to understand traits of internet shoppers, their general shopping orientation, their web-usage-related lifestyle, and their psychographic characteristics. In addition, I will evaluate their motivations for shopping groceries online, their perceptions of the advantages and disadvantages of shopping online for groceries and situational factors that may elicit online purchase of groceries. Miou Company that has a chain of national supermarkets in Australia intends to open an online grocery-shopping website to counter the challenge posed by fast growing online shopping. One of the first things to consider in the research is seeking to understand the traits of internet shoppers. Internet shoppers tend to rely on feedback reviews about products and services done by those who have already been served by the company. According to Zhu and Zhang, a recent survey reveals that 24% of internet users’ access online reviews before paying for a service delivered offline. Such reviews have become an important marketing tool because companies post information about their products, engineer online forums and chats about the products where they proactively advice their consumers to spread the gospel of their products. Through use of internet, companies have managed to manipulate customer’s reviews and influence their decisions (Zhu and Zhang, 2010). Chevalier and Mayzlin agree to the character of online customers that depend on reviews. They argue that customer ratings significantly influence product sales especially in the book industry where customers read review texts in addition to review statistics (Chevalier & Mayzlin, 2006) Secondly, a market researcher must seek to understand customer’s general shopping orientation. The advancement of World Wide Web has enabled many companies to transact online and customers to do web shopping. Electronic shopping is growing by day and thus has become an important trend that influences the markets. Therefore, to identify the opportunity a researcher needs to identify the determinants of a customer’s online purchase intention. Since managers need to make a decision, the opportunity becomes the problem. A small sample will help in understanding the impacts of shopping orientations. According to Ling, a research run to determine shopping orientations, online trust, and prior online purchase experience to the customer purchase intention reveals that impulse purchase intention brand orientation, quality orientation, and prior online experience have a positive impact to the customer online purchase intention (Ling, 2010). Online shopping experience is different from the traditional consumer behaviour, which calls for marketers to explore the determinants of customer online intention among web shoppers. Forsythe and Shi concurs with this argument and states that online shopping poses special risks on the side of the customer, which makes trust an important aspect for a transaction to take place (Forsythe, Shi, 2003). Additionally, similar products present deferring web shopping experience as the customers interact with virtual environment enabled by the web. According to Brown, Pope, and Voges, despite the worldwide belief that internet shoppers are motivated by convenience, their study revealed that fundamental shopping orientations have no significant impact on proclivity to purchase products online. They concluded that product type, prior purchase, and gender are the three factors that influence purchase intention (Brown, Pope, and Voges, 2001). Thirdly, a marketer must endeavour to understand web-usage-related lifestyle of Australians. Australia statistics reveal that 80.1% of the population use internet. According to Australian bureau of statistics, the most important data comes from the social media who use internet to evaluate products and services (Australian bureau of statistics, 2012). Internet plays the role of facilitating information search for consumers. Product purchase is enhanced by providing customers with huge amounts of information about product pricing, product availability, and product attributes. Internet related psychographic characteristics seem to be in line with online purchase behaviour. Persons who spend a lot of time in the web and those who appear to have used internet for a long period tend to make online purchases. According to Brengman et al, internet convenience, perceived self-inefficacy, internet logistics, internet distrust, internet offer, and internet window-shopping are the main factors that influence a web-usage-related lifestyle (Brengman et al, 2003). Market segmentation by use of demography and web based psychographics help understand the lifestyle of web shoppers. However, some lifestyles go beyond this because some web shoppers opinion is based on convenience, affordability, ease of use, and trust. According to Plummer, Understanding ones customers helps to effectively communicate and market ones products to them (Plummer, 1974). The study of people values and lifestyles plays an important role especially when combined with product specific variables. Fourthly, a marketer needs to understand the motivations behind consumers purchasing their products online, its advantages, and disadvantages. The main motive behind many consumers web shopping is convenience. Many consumers are motivated by attractiveness of products to go shopping. Groceries lack in this aspect of attractiveness and many consumers find it boring to shop for groceries. It is also hard to find all of them in one shelf or shop, which makes it a tedious exercise. This motivates consumers to shop online. One major advantage in shopping online is that a consumer has an opportunity to compare various products or services from various parts of the world or from various stores. It is also possible to select the best prices, send gifts, avoid crowds, compulsive shopping, and perform discreet purchases. Web grocery shopping helps families to spend less because when families go out on shopping sprees they use fuel, eat out, and do some other impulse buying. However, online shopping has some disadvantages in that the shipping expenses are high, it is a risky venture since not all sites are genuine, a customer cannot try an item before buying it, and some sites may be difficult to use. To the company, a small breach of trust loss of so many customers because trust means everything to online shoppers. According to Pavlou, “trust plays a key role in creating satisfied and expected outcomes in online transaction,” (Pavlou, 2003). Sufficient trust need to exist when a customer is placing an order online and when undertaking financial transactions. In conclusion, online grocery shopping for Miou Company will be a great move. This is because it is not exiting for shoppers to shop grocery as it is with other products, which have made them shift their habit to online shopping. Australia social media growth has continued to hit the headlines with most social interactions geared towards product and services evaluation. Research has shown that most of the social interactions in the country gear efforts towards product and services research. This is a great advantage for Miou Company. Miou Company can build a business around understanding the motivation that drives customers to do web shopping. The fact that shopping grocery online has some savings and convenience for shoppers makes it easier for Miou to establish an online store. Additionally, understanding web-related lifestyle in terms of logistics, perceived in-efficacy, distrust, and affordability will play an important role in establishing an online grocery store. References “Australian Bureau of Statistics,” (2012). “Internet Activity, Australia, Dec 2011,” Retrieved From, Http://Www.Abs.Gov.Au/Ausstats/Abs@.Nsf/0/AA6CDED0358F725FCA25743400186F8E?Opendocument Brengman, M., Geuensb, M., Weijtersc, B., Smithd, S., & Swinyardd, W. (2003). “Segmenting Internet Shoppers Based On Their Web-Usage-Related Lifestyle: A Cross-Cultural Validation,” Journal of Business Research. Vol 58, Issue 1, 2005, Pp 79–88 Brown, M., Pope, N., & Voges, K., (2001). “Buying Or Browsing? An Exploration Of Shopping Orientations And Online Purchase Intention,” European Journal Of Marketing, 37(11/12), 1666-1684 Chevalier, J. & Mayzlin, D. (2006). “The Effect Of Word Of Mouth On Sales Online Book Reviews,” Journal Of Marketing Research, 43, 345–54 Forsythe, S. And Shi, B. (2003). “Consumer Patronage And Risk Perceptions In Internet Shopping,” Journal Of Business Research, 56(11), 867-875 Ling, K. (2010). “The Effects Of Shopping Orientations, Online Trust And Prior Online Purchase Experience Toward Customers’ Online Purchase Intention,” 3(3), 63-76 Pavlou, P. (2003). ‘Consumer Acceptance Of Electronic Commerce: Integrating Trust And Risk With The Technology Acceptance Model’, International Journal Of Electronic Commerce, 7(3), 101-134 Plummer J. (1974). “The Concept And Application Of Lifestyle Segmentation,” Journal Of Marketing” January, 33 Zhu, F. & Zhang, X. (2010). “Impact Of Online Consumer Reviews On Sales: The Moderating Role Of Product And Consumer Characteristics,” Journal Of Marketing, 74, 133-148 Read More