Post on 04-Apr-2015
Table of Contents1. Introduction..................................................................................................................................1
1.1. Market Situation...................................................................................................................2
1.2. Research Significance and Problem Statement....................................................................3
2. Literature Review and Relevant Theories...................................................................................3
2.1. e-Service Attributes..............................................................................................................4
2.2. Consumers’ Satisfaction.......................................................................................................5
2.4. Behavioral Intentions............................................................................................................5
3. Research Design and Method......................................................................................................6
3.1. Framework and Hypothesis of the study..............................................................................6
3.2. Population and Sampling......................................................................................................7
3.3. Instrument for data collection...............................................................................................7
3.4. Analysis of the data..............................................................................................................7
4. Time Plan.....................................................................................................................................8
References........................................................................................................................................9
Appendix A....................................................................................................................................13
Appendix B....................................................................................................................................14
Appendix C....................................................................................................................................15
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Consumers’ Behavior towards Online Grocery Shopping: An Investigation of e-retail service context in the UK
1. Introduction In last two decades, diffusion of internet in the retail industry has imposed certain implications
for the e-retail managers and online business practitioners. Retail managers have paid strategic
attention to online channels of the retail market in order to cope up the crucial demands of the
consumer goods particularly in the grocery industry (Hansen, 2005), where consumers have
adapted the habit of online searching and/or buying in their routine shopping (Srinisvan, et al.,
2002). The increasing intensity of online shopping has grabbed the attention of marketing
theorists and e-retail practitioners to go across the conventional web stores (Lee and Lins, 2005)
and come up with the innovative and quality oriented web layouts (Siddiqui et al., 2003) in order
to manipulate the satisfaction level and to gain positive change in the behavioral intentions of the
consumers (Kim and Forsythe, 2010). These innovative and quality oriented web layouts contain
several service attributes such as consumer convenience, safety, enjoyment, low price and so on,
that reciprocally provides online shoppers a holistic virtual shopping environment to fulfill their
ever demanding desires (Kim et al., 2007). The core interest of the current research is to study
the UK online grocery market, by exploring the theoretical dimension of e-retail service quality
that has certain influence on the consumers satisfaction level; and up to what extent this element
of satisfaction in consumers’ mind generate changes in their behavioral intentions.
Consumer perception is a critical element in the behavioral studies, Schifman and Kanuk
in their book consumer behavior (2006) defined this cognitive process through which individual
selects, organizes, and interprets stimuli into a meaningful and coherent picture of the world. The
cognitive process of the consumers evaluates the e-service offerings of the online grocery
retailers and develops certain perceptions against grocery websites. In today’s web oriented
world, shoppers search several products on the internet before buying and among consumers’
goods a very common thing to buy is grocery (Hansen, 2005). It is crucial for the grocery e-
retailers to understand the consumer perception about the websites’ service quality that has
certain impact on the consumers’ satisfaction and, ultimately, on their behavioral intentions. The
usage of internet to search products conveniently and at the cheaper rate is quite common among
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the consumers (Mintel, 2009), yet a big number of consumers feel reluctant to do grocery
shopping online (Kim and Forsythe, 2009). This research impetus the effect of service quality
attributes on the online grocery shoppers and up to what extent these attributes manipulate the
consumers’ satisfaction and behavioral intentions.
1.1. Market SituationStudy published by Mintel in 2009 averred that UK online retail market has come up with a
significant growth volume in the year 2008 (presenting an accelerated growth of 25%) and after
five years since 2008, market will approach an approximate value of 57.3 billion dollars (with an
estimated surging % of 69.4). Particularly, the UK internet grocery market has shown value of
approximately £3.14 in the year 2008 – which is 27.9 % increased value against the previous
year 2007 (Keynote, 2009a).
Grocery shopping on the internet is a sub branch of the home shopping values.
Purchasing grocery online provides certain advantages to the web shoppers; it incorporates
extensive range of products, easy price comparison, convenient home deliver to save time and
many others. There are four key players in the UK online grocery market – Tesco, ASDA, J
Sainsbury’s and Waitrose – and a fifth warehouse based online operator with the name of Ocado
(a sub-partner distributor of Waitrose) (see Appendix. A). In spite of steady growth in the
grocery market of UK, the sixth major ground grocery retailer Morrisons has not yet stepped in
the online market (Keynote, 2009b). The five above mentioned companies dominates the online
grocery market, contributing 89.2% of the whole market size with the sales figure of £2.8 billion,
which is still too small only 2.8% of the grocery sales in the UK for the year 2008 (Keynote,
2009a) (also see Appendix. B). In contrast to the figures of 2008, keynote report has declared
that market expansion of online grocery retail in UK has a projection of double size in the year
2013. Market situation illustrates that the growth opportunities are there for the e-tailers in the
online grocery competition, but e-retail practitioners and managers have to come up with better
service offerings to manipulate the consumers’ shopping choice. This research has the potential
to come up with certain positive directions for the e-retailers in the UK grocery market.
1.2. Research Significance and Problem StatementMajor players of grocery market are redesigning their conventional websites to meet the
contemporary service trends of the online retail market to cope up the emerging trend of people
shopping styles in the UK. This is significant for the managers (such as brand, store, service and
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retailer business) and for the marketing theorists to study the in depth importance of the grocery
web-retail attributes to incorporate positive efforts in this particular context. A few studies has
covered the grocery market (such as Hansen, 2005; an online administered questionnaire based
study) or an exploratory study generally covering the online shopping trends of UK from
retailers perspective (Rowley, 2009) has attempted to add literature in this area. Though, from
end consumers’ corner hardly any research has been done yet in the UK online grocery market.
This research will cover the conceptual gap found in the academic literature to help out the
business academicians as well as it will cover the contextual gap to provide new directions to the
e-retail managers of the online grocers by resuming the below defined problem statement:
“To study the relationships between e-Service Attributes, consumers’ satisfaction and behavioral intentions in context of the UK online grocery market”
1.3. Research Objectives
Under the light of the above mentioned introduction and market scenario problem statement, this research will cover the following major objectives
To study the consumers’ shopping behavior in the e-retail area of UK grocery market
To study the relationship between e-Service attributes and Consumers’ satisfaction in the
grocery e-tail market of the UK
To examine the relationship between satisfaction and behavioral intentions from
consumers’ point of view in the online grocery market of the UK
2. Literature Review and Relevant TheoriesThe purpose of literature review is to thoroughly discuss the topic in a particular context of past
studies and to avoid any sort of unawareness to important dimensions and variables that might
have certain influence on the current research (Bryman and Bell, 2007). Since this study is based
on the consumers’ behavior regarding grocery market of online industry in the UK, it will be
worthwhile to deeply go through the earlier literature related to the three main variables, e-
Service Attributes, Consumers’ Satisfaction and Consumers’ Behavioral intentions, mentioned in
the current study.
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2.1. e-Service AttributesService quality is a sub-marketing concept muscularly linked with the perceptions of the
consumers (Gummensson, 1979). Several well renowned Scandinavian and American
researchers (Grönroos, 1982; Parasuraman et al., 1985) are at the top of the lists who have
contributed in the conceptualization of the term “service” in marketing literature. Since 1985, a
commonly used definition of service quality in marketing literature as well as in practical aspect
is “how customers make comparison between their expectations and perceptions of delivered
services” (Parasuraman et al., 1985). Parasuraman and two of his colleagues Zeithaml and Berry
(1988) retrieved a measurement tool, from the earlier discussed concept of service quality,
named as “SERVQUAL” (including five core service attributes: tangibility, reliability,
responsiveness, empathy and assurance) to measure the real business performance of service
firms. Nevertheless, due to the unbelievable surfacing of e-retail business in the 21st century,
traditional service quality measurement tool “SERVQUAL” has been restated by several
researchers (such as Kaynama and Black, 2000;Yoo and Donthu, 2001; Loiacono et al., 2002;
Wolfinbarger and Gilly, 2003; Webb and Webb, 2004; Parasuraman et al., 2005; and Kim et al.,
2006 ) with their own dissimilar names (such as E-Qual, SITEQUAL, WEBQUAL, eTailQ,
SiteQual, E-S-QUAL and E-A-S-QUAL), respectively. Santos (2003, p.235) refined the concept
of service quality in electronic retailing context as “the consumers’ overall evaluation and
judgment of the excellence and quality of e-service offerings in the virtual marketplace”.
Later on, Kim et al., (2009) examined the e-retail context by using the five key attributes
of e-service quality such as convenience, customization, information, communication and web-
aesthetics, which are all driven through their previous research paper published two years before
(Kim et al, 2007). Their latest US college male and female students based research in e-retail
apparel context has exposed that the quality of e-service attributes have certain positive impact
on the consumers’ satisfaction and behavioral intentions (i.e loyalty).
2.2. Consumers’ Satisfaction Concept of consumers’ satisfaction has been remarkably remained a hotspot of marketing
professors for the last four decades (Ha et al., 2010a). Since the publication of Oliver (1977)
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article in the ‘Journal of Applied Psychology’, marketing scholars have examined this concept
through different consumer behavior perspectives to create a generalize conceptualization.
However, till the moment researchers are in the controversial debate to agree on a single pet
definition of satisfaction (Roger et al., 1992) due to the subjectivity element linked with the
consumers’ multi-service experiences in this global world. Oliver (1989) cited by Ha et al.,
(2010b) defined satisfaction as ‘an evaluation, affective, or emotional response of the consumer’
(p.1). Though the current study discusses the e-Service attributes, past researchers (such as
Parasuraman et al., 1988; Anderosn et al., 1994) have consensus that perceived service quality,
expectations and disconfirmation directs the consumers toward satisfied/dissatisfied decision
stage.
Particularly, e-Service quality delivered to the customers through several web attributes
has certain influence on customers’ satisfaction, eventually. The positive and negative evaluation
of the e-Service quality attributes leads the customers to build a satisfactory or dissatisfactory
image in his/her mind, which means if the service delivered from web retailer side is evaluated
better in quality then as a result satisfaction should occur at the consumers’ end (Carlson and
O’cass, 2010). Satisfying the customers has always been remained at the priority of the
managerial interests. The available recent papers examining the websites have argued that better
service quality of a firm has a positive influence on the customers’ satisfaction (Cristobal et al.,
2007; Yen and Lu 2008; Lin and Sun, 2009), which is a remarkable indicator for a firm’s
prospect profitability (Kotler, 1991, p.19; Anderson et al., 1994) and illustrates that how a
company has to allocate its resources in the business to achieve the milestones of its long term
growth plans (Anderson and Sullivan, 1993).
2.4. Behavioral IntentionsLiterature of marketing has widely discussed the role of service quality and consumer
satisfaction in several retail business environments. Researchers, in most of these papers, are
keened toward the evaluation of behavioral intentions that prepare consumers to act, ultimately,
to act in the approval/disapproval of the company. Fishbein and Ajzen (1975) defined behavioral
intentions ‘as the customers’ subjective probability of performing a certain behavioral act’.
Most of the marketing papers have revealed that such consumers’ behavioral acts are seems to be
in the market place in the form of word of mouth (Brown et al., 2005); purchase intention
(Cristobel et al., 2007); commitment (Park and Kim, 2003); repurchase intention (Anderson and
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Sullivan, 1993; Ha et al., 2010a); complaint behavior (Janda et al., 2002) and consumers’
switching intention (Zeithmal et al., 1996). For last one decade, numerous researchers have
examined the consumers’ behavioral intentions in the e-retail context and previous research will
precise the current study to come up with new empirical findings in the services marketing
literature.
Concluding the above mentioned literature, several studies have exposed that
relationships between e-Service quality attributes, consumers’ satisfaction and behavioral
intentions in retail context has occurred. Current study will explore these relationships in online
grocery shopping context and come up with new judgments of consumers in the UK market.
3. Research Design and MethodResearch methodology is based on the philosophical approach to manipulate a compatible
strategy that gives a thorough support in the study (Saunders et al., 2003). Current study has
focused on the online grocery shoppers of the UK to empirically investigate the conceptual
model developed through prior theoretical literature. Hence, application of deductive approach is
satisfactory to fulfill the requirement of current research design (Sekaran, 2004). The adaptation
of deductive approach underpins quantitative self-administered online questionnaire in order to
empirically investigate the problem statement.
3.1. Framework and Hypothesis of the studyTheoretical framework introduced in the current research explores the hypothesized relationships
between the three constructs in the UK online grocery (see Appendix C), based on the previous
research work written in the literature of consumer and services marketing. .
H1: Web appearance and design related e-Service quality attributes have certain impact on consumers’ satisfaction.
H2: Customer service attributes in the online grocery market have certain impact on consumers’ satisfaction.
H3: Convenience related e-Service quality attributes have certain impact on consumers’ satisfaction.
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H4: Web usefulness and Ease of Use related e-Service quality attributes have significant influence on the consumers’ satisfaction.
H5: Information related e-Service quality attributes have significant influence on consumers’ satisfaction.
H6: Security and Privacy risk related e-Service quality attributes have significant impact on the consumers’ satisfaction.
H7: e-Service quality of online grocery retail has significant influence on consumers’ satisfaction level.
H8: Consumers’ satisfaction towards online grocery retail has certain impact on the consumers’ behavioral intentions.
3.2. Population and Sampling The population includes all those people who are the online shoppers of grocery websites. As the
trend is latest in the market, most of the respondents will be young in their age, per se. In
addition, a convenience sample of 250 male and female online grocery shoppers in the five major
cities of the UK will be selected for the data collection.
3.3. Instrument for data collection An online questionnaire based on several items retrieved through the theoretical literature will be
build in order to deal with the research. Online questionnaire will be uploaded on a URL to
distribute to the subjects so that they can answer conveniently by staying at their homes, offices
etc (Bryman and Bell, 2007 p.474).
3.4. Analysis of the dataIn the first part of this section, socio-demographic analysis of the sample characteristics will be
done to present the gender, age, education, internet usage, monthly expenditure, annual
household income and monthly grocery expense. In the second section, SPSS ‘compute’ option
will be used to calculate the average mean of each construct scale of the e-Service quality
attributes (such as convenience, information, customer service etc), Consumers’ Satisfaction, and
behavioral intentions. The average mean of each dimension will be re-coded in the SPSS to
develop new variables (named as CONV, ESQL, BVNT etc) for further statistical analysis such
as mean, standard deviation and linear correlation. In the third section, linear regression model
will be run on the SPSS to present summary statistical model, ANOVA (analysis of variance), t-
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statistics and regression coefficients on the main variables of the study in order to test the
developed hypothesis discussed in the framework.
4. Time Plan
Prelimanry Literature Review
Refinement of Research Questions
Development of Theoretical Framework
Development of Research Hypothesis
Pilot Study (including ethical implications)
Pilot Study Analysis & Modifications
Data Collection
Data Analysis and Interpretation
Report Writing
25-Oct-11 12-May-12 28-Nov-12 16-Jun-13 02-Jan-14 21-Jul-14
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Appendix A
Financial Results for the Leading UK Supermarket
Chains (£m and %), Latest Financial Years
Turnover (£m)
Pre-Tax Profit (£m)
Pre-Tax Profit Margin (%)
Year End
Tesco PLC 54,327.0 2,954.0 5.4 †28/02/09
J Sainsbury PLC
18,911.0 466.0 2.5 21/03/09
ASDA Group Ltd
16,896.4 560.7 3.3 31/12/07
Wm Morrison
Supermarkets PLC
14,528.0 655.0 4.5 01/02/09
Somerfield Ltd
4,221.4 82.6 2.0 26/04/08
Waitrose Ltd 3,737.2 120.3 3.2 26/01/08
† — 53-week period
Note: turnover for Tesco PLC, J Sainsbury PLC and
Wm Morrison Supermarkets PLC excludes VAT; for
Tesco PLC, J Sainsbury PLC and Waitrose Ltd,
turnover equals revenue.
Source: www.myicc.co.uk
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Appendix B
The Approximate UK Internet Grocery Market as a Percentage of
Retail Sales Through `Predominantly Food Stores' in Great Britain (£m
at rsp and %), Years Ending December 2004-2008
2004 2005 2006 2007 2008
UK Internet grocery
market (£m at rsp)e 1,085 1,375 1,835 2,455 3,140
Retail sales through
food stores (£m at rsp)†
106,493 110,055 114,240118,157
124,835
UK Internet grocery
sales as a % of
retail sales through
food storese 1.0 1.2 1.6 2.1 2.5
rsp — retail selling prices
Source:
https://www.keynote.co.uk/market-intelligence/view/product/2268/e-
commerce%3A-the-internet-grocery-market/chapter/5/supermarkets-
online?highlight=online retail market UK
Appendix C
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Theoretical Framework of the Study
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