A Study on Consumer Perception towards Online Grocery Store
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A Study on Consumer Perception towards Online Grocery Store By Submitted In fulfillment of the requirement for the degree Masters in International Management To Institu d' Administration des Enterprises Greater Noida Campus, India
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According to an India online landscape study (Juxt, 2010), the number of active Internet users in India stands at 65 million, of which 17 million are online shoppers, indicating a growth of 70% from the previous year.
Transcript of A Study on Consumer Perception towards Online Grocery Store
A Study on Consumer Perception towards
Online Grocery Store
By
Submitted
In fulfillment of the requirement for the degree
Masters in International Management
To
Institu d' Administration des Enterprises Greater Noida Campus, India
University of Poitiers, France
April, 2013
DECLARATION
I hereby declare that the project report titled “A Study on Consumer Perception
Towards Online Grocery Store”, under the guidance of Prof: Debjani Bhattacharyais my
work submitted in partial fulfillment of the requirement for the Degree of MASTERS IN
INTERNATIONAL MANAGEMENT from INSTITU ADMINISTRATION DES
ENTERPRISES, Poitiers and not submitted for the award of any degree, diploma, fellowship or
any similar titles or prizes
Date: 11/03/2013
Signature:
CERTIFICATE OF COMPLETION OF DISSERTATION
This is to certify that Dissertation Report on
A Study on Consumer Perception Towards Online Grocery Store, prepared by the
Himansu S Mishra is his genuine effort under my guidance and supervision.
Signature:
Prof: Debjani Bhattacharya
Faculty Guide
NIILM-CMS
Date:
ACKNOWLEDGEMENT
This project proved as an excellent opportunity for me to apply the concepts learnt in the
course of my program at the institute.
I would like to express my sincere gratitude and thanks to my supervisor and mentor, Prof. for
guiding and providing complete knowledge about the subject briefing about market and risk
calculations
Finally, I would like to thank all those who were directly or indirectly related to this project.
Signature
Date
Executive Summary
Internet and Information technology have made tremendous contributions for business transformation
witnessed nowadays all over the world. This has given birth to E commerce which encompasses several
pre purchase and post purchase activities leading to exchange of products or service or information over
electronic systems such as the internet and the other Telecommunication networks.
Analysing the competitive advantage of E-Commerce it is observed that E-Commerce enables simpler,
faster and efficient business transactions. For developing country like India, E-Commerce offer
considerable opportunity for growth.
E-commerce leads to a boon for the current economic downturn. As India’s e-commerce market is worth
about Rs 50,000 crores in 2011. About 80% of this is travel related (airline tickets, railway tickets, hotel
bookings, online mobile recharge etc.).
Online retailing comprises about 15%. India has close to 10 million online shoppers and is growing at an
estimated 40-45% per annum.The rapid growth of e-commerce in India is being driven by greater
customer choice and improved convenience.
The project was undertaken under the supervision of Nirala Imex Inc who currently has their business
operation in Taiwanese market in selling of Indian grocery items to the local retailers & wholesaler in the
Taiwanese market.
The company has proposed a plan to launch an online grocery store in the Indian market for which the
project was undertaken was to determine whether online grocery shopping will be beneficial to the user
with respect to questionnaire which will be analysed in three parts.
The project will first study the attitude of customers towards online shopping, also determining the factors
which influence the consumer to purchase goods and service.
The second half of the project will depict the attributes of online shopping influencing the purchase
decision by the respondent. It will also determine the issues regarding the online shopping.
The third part of the project determines the purchase decision with respect to grocery. It will determine
the place preference of grocery shopping with respect to price, quality, variety, proximity and offers/
discounts. The project will also recommend the business operational plan which works with contracting
dealership with the local kirana stores.
Contents
Executive Summary.............................................................................................................................................5
List of Abbreviations............................................................................................................................................9
Introduction.......................................................................................................................................................10
1.1 What is e-commerce?..................................................................................................................................10
1.2 Purpose of Study.........................................................................................................................................10
1.3 Existing Issues................................................................................................................................................2
1.4 Outline of the Study.......................................................................................................................................2
1.5 Organization of report...................................................................................................................................3
Literature Review................................................................................................................................................4
2.1 Understanding use of e-commerce...............................................................................................................4
2.2 Models of E-commerce..................................................................................................................................4
2.3 Overview Business-to-consumer (B2C)..........................................................................................................6
2.3.1 A Consumer Perspective of E-Service Quality.....................................................................................7
2.3.2 B2C E-Commerce Web Site Quality......................................................................................................7
2.3.3 Customer Expectations and Service Quality Dimensions Consistency..............................................7
2.4 Online Shopping In India................................................................................................................................8
2.5 Online Grocery Shopping...............................................................................................................................9
2.5 Indian Players in Online Grocery Shopping..................................................................................................11
Research Plan....................................................................................................................................................14
3.1. Research Objectives....................................................................................................................................14
3.2 Research Scope............................................................................................................................................14
3.3 Research Design and Methodology.............................................................................................................14
3.4 Sampling......................................................................................................................................................14
3.5 Questionnaire Design..................................................................................................................................15
Analysis and Findings.........................................................................................................................................17
4.1 Demographic observations..........................................................................................................................17
4.2 Questionnaire Analysis................................................................................................................................21
Chapter 5...........................................................................................................................................................33
CONCLUSION.....................................................................................................................................................33
5.1 Summary.....................................................................................................................................................33
5.2 Limitations...................................................................................................................................................33
5.3 Revisiting objectives....................................................................................................................................33
5.4 Major Findings.............................................................................................................................................34
5.5 Future Scope................................................................................................................................................34
5.6 Recommendation........................................................................................................................................35
5.7 Conclusion...................................................................................................................................................35
Bibliography:.....................................................................................................................................................40
Reference Links:................................................................................................................................................40
Web Links..........................................................................................................................................................40
List of Figures
Figure 1: Gender Distribution............................................................................................................................18Figure 2: Age distribution of sample..................................................................................................................19Figure 3: Occupation of sample.........................................................................................................................20Figure 4: Average Annual Income of sample.....................................................................................................21Figure 5 : Popularity of online items..................................................................................................................22Figure 6: amount of money spent on online shopping......................................................................................23Figure 7: Need of shopping online....................................................................................................................24Figure 8: Features of websites attracting users.................................................................................................25Figure 9: Features effecting the most satisfaction.............................................................................................26Figure 10: Issues considered while shopping online.........................................................................................28Figure 11: Shops preferred for grocery items....................................................................................................29Figure 12: Preference to buy grocery online.....................................................................................................30Figure13: Opinion on buyng grocery online......................................................................................................31Figure 14 : Parameters beneficial for shopping online......................................................................................32
List of Tables
Table 1: Gender Distribution.............................................................................................................................18Table 2: Age Distribution for sample.................................................................................................................19Table 3: Occupation of sample..........................................................................................................................20Table 4 : Average Annual Income of sample.....................................................................................................21Table 5: Popular Items online..........................................................................................................................22Table 6: amount of money spent on online shopping......................................................................................23Table 7 :Need of shopping online......................................................................................................................24Table 8: Features of websites attracting users..................................................................................................25Table 9: Features effecting the satisfaction most.............................................................................................26Table 10: Issues considered while shopping online..........................................................................................28Table 11: Shops preferred for grocery items.....................................................................................................29Table 12: Preference to buy grocery online......................................................................................................30Table 13: Opinion on buyng grocery online.......................................................................................................31Table 14: Parameters beneficial for shopping online.......................................................................................32Table 15: Correlation of factors with attitude of online users...........................................................................33Table 16 : Regression table................................................................................................................................34
List of Abbreviations
Abbreviation Description
Chapter 1
Introduction
1.1 What is e-commerce?
Information communication technology and the Internet have made contributions in changing the concept of
business. There is a paradigm shift of business model witnessed today all over the world. The proliferation of
internet has given birth to E-business and subsequently e-commerce. While e-commerce is confined to a
transaction, e-business encompasses several pre purchase and post purchase activities leading to the exchange
of products or service or information over electronic systems such as the internet and the other electronic mode
including telecommunication networks.
Analyzing the competitive advantage of e-commerce it is observed that e-commerce enables simpler, faster
and efficient business transactions. It helps in developing low-cost leadership in existing markets and
introduces product differentiation and mass customization. For a developing country like India, e-commerce
offer considerable opportunity for growth.
E-commerce has entered every section of business and influenced the retail sector in a big way. The
proliferation of internet in remote corners of developed as well as developing countries have proved to be
conducive for a steady growth of online market and commerce. The unserved and underserved sections of the
society have been privileged to get access to a broader choice of commodities and service.
1.2 Purpose of Study
According to a Nelson report, 2012 UK and US are forecast to remain at the center of the growing global
market for online grocery retailing, new research has shown, as new technology continues to change the way
consumers shop. A report published by just-food.com shows the UK will remain Europe's largest market by
some distance. By 2014, market value is forecast to reach GBP20.1bn (US$30. 9bn), having more than tripled
on the levels seen in 2009. During this time, the online sector's share of the retail food and drinks market is
expected to increase to 4% in 2010, reaching 9.5% by 2013 and then exceeding 12% by 2014.
The US market, by comparison, is expected to reach a value of US$13. 55bn, which represents an increase of
almost 75% compared with levels in 2009, the report said. Although the market is forecast to continue to
experience double-digit growth rates in the region of 11-12% per year, its share of the US retail grocery market
is unlikely to rise above 2% during this time, the report claimed. Much of the projected growth within the US
market is expected to come from the anticipated spread of broadband access across the country. The online
market may also benefit from the increasing tendency of shoppers to research products prior to purchase.
India‘s e-commerce market is worth about Rs 50,000 crores in 2012 about 80% of this is travel related (airline
tickets, railway tickets, hotel bookings, online mobile recharge etc.). Online retailing comprises about 15%.
India has close to 10 million online shoppers and is growing at an estimated 40-45% per annum. The rapid
growth of e-commerce in India is being driven by greater customer choice and improved convenience.
1.3 Existing Issues
With increasing popularity of e-commerce in all sectors of business world, huge investments are made by
business houses enhancing B2C and B2B transactions. Besides there are several other models which have
developed e.g. C2C, G2C, and many more. Though e-commerce has seen the boom, there have been many
stories of failure. One of the basic reasons of failure is the gap between server perception and customer
perception of quality of online service. There have been many scholarly articles (Sasser, Olsen and Wyckoff,
1978; Grönroos 1982; Lehtinen and Lehtinen 1982; Lewis and Booms 1983; Parasuraman, Zeithaml and Berry
1985; Ennew, Reed and Binks 1993) suggested that service quality is a gap score of what a customer expects
from a company and what is offered to them in reality. They reiterated that it is important to understand how
customers assess service quality because it is the key factor which differentiates service products and give a
competitive edge to business. Parasuraman et.al. (1988, 1991) conceptualized service quality into a measuring
scale, SERVQUAL which gained good recognition in many other published studies. It was considered
important to study the customer perception of online shopping.
1.4 Outline of the Study
The project was undertaken in supervision of Nirala Imex Inc. which conducts its business in Taiwan. The
operation include selling of Indian grocery items to the local retailers & wholesaler.
The company has proposed a plan to launch an online grocery store in the Indian market for which the project
was undertaken to determine whether online grocery shopping will be beneficial to the user with respect to a
questionnaire which will be analyzed in three parts. The project had the following objectives:
(1) To study the attitude of customers towards online shopping,
(2) To identify factors influencing consumers’ online purchase decision of goods and services.
(3) To identify issues related to online shopping from the customer’s point of view.
(4) To study the place preference of grocery shopping with respect to price, quality, variety, proximity and
offers/discounts.
The project will also recommend the business operational plan which works with contracting dealership with
the local Kirana stores.
1.5 Organization of Report
The report is organized in 5 chapters as follows
Chapter 1 introduces the subject of research. The issues have been mentioned in the chapter and objectives
identified accordingly for the study.
Chapter 2 gives a brief of theoretical background and related works done by different scholars , so that the
study can be built on them.
Chapter 3 explains the research plan. The type of research study , sampling method adopted and questionnaire
design have been explained elaborately in this chapter.
Chapter 4 shows Data tabulation and analysis of data. Descriptive analysis has been followed by questionnaire
analysis. Correlation and regression has been used to understand the study.
Chapter 5 summarises the project, discusses limitations, future scope and recommendation from the study.
Chapter 2
Literature Review
2.1 Related Studies
Impact of promotions and value consciousness in online shopping behaviour in India.Journal of Database Marketing & Customer Strategy Management; Dec2012, Vol. 19 Issue 4, p311-320, 10p
Online shopping continues to attract investment from retailers. Online shopping websites offer discounts and
promotions to attract online shoppers. Online retailing is in the nascent stages of growth in India. The research
examines the influence of deal proneness on Indian consumers' online shopping behavior. The results indicate
that Indian consumers are not influenced by deals, offers or other promotional tools being used by online
retailers. Promotions may not be necessary viewed by consumers as an important attribute while purchasing
products or services online. The instrumental aspects of online shopping websites need to be strengthened to
motivate consumers to shop online.
E-commerce: A boon for the current economic downturn
First Data Corporation and ICICI Merchant Services, has laid down some facts that e-commerce market in
India had clocked close to Rs 50,000 cores by the end of 2011.
Even though there are less than 10 million internet users who are actually engaging in e-commerce activities,
there are about 150 million internet users in India or around 75 million households that are ready for e-
commerce.
With entry and operational costs being comparatively low than the other countries like US, the second half of
2011 and the beginning of the current calendar have seen the launch of a good number of new e-commerce
sites spanning across a variety of businesses – women’s fashion, men’s fashion, shoes, followed by
accessories, groceries, sports, toys, home furnishings, jewellery, automotive, bicycles, electronics and
electrical equipment etc.
Key drivers for success for e-commerce
Reduction in operational cost as the entire business can be moved online, the need for physical stores has
become obsolete. Less infrastructural investment and associated labour costs drives up the profit margin.
It is far easier and quicker to compare prices of goods online, equipping the customer with the information to
decide the right price or terms for themselves. With services like COD, customers can trust the process of
going online and purchasing.
Market penetration also becomes far more achievable with e-commerce; it is possible for a merchant in
Mumbai to extend his reach to north-eastern cities or even rural villages that are now connected by the online
network.
E-commerce facilitates shopping anytime, anywhere and for almost anything desired. Busy consumers prefer
this to the restrictions of when a mall/shop is open and the need to physically travel to a shop. Online business
takes shopping a step further by taking itself to the customer creating conveniences of shopping anywhere and
at anytime.
In India, with the increasing propensity of social media, businesses have now begun to engage their customers
on social networking portals such as Facebook. These are likely to be rapidly developing marketing channels
for the future.
Factors Influencing Online Shopping: An Empirical Study in Ahmedaba.
IUP Journal of Marketing Management; Nov2012, Vol. 11 Issue 4, p51-65, 15p, 9 Charts, 1 Graph
According to an India online landscape study (Juxt, 2010), the number of active Internet users in India stands
at 65 million, of which 17 million are online shoppers, indicating a growth of 70% from the previous year. The
statistics alone are enough to denote the potential of e-commerce in India. However, as the online market
becomes crowded with players, businesses need to have an edge in terms of customer satisfaction to gain a
larger market share. With the above-mentioned objective in mind, a primary survey of online shoppers was
conducted in Ahmedabad and consumer perceptions were analyzed using factor analysis and Analysis of
Variance (ANOVA) test. The paper has found that ease/attractiveness of website, service quality of website
and website security are the three dominant factors which influence consumer perceptions regarding
their online purchasing experiences. Hence, businesses which focus on these three factors can attract more
clicks. Also, the paper has proved that these factors are related to the various types of consumers classified as
trial, occasional, frequent and regular (based on their frequency of purchase). The authors have found that
regular buyers are most influenced by ease/attractiveness of website and service quality of website, while
occasional buyers value website security more than other categories of consumers.
Convenience, Price, Product: Motivators for Online Specialty Food Consumers.
(Journal of Food Products Marketing; 2001, Vol. 7 Issue 1/2, p53, 13p)
This study by White, Gregory K.1Manning, Barbara J. Examines the factors motivating consumers'
purchases of specialty food and beverage products via the Internet. While convenience is often cited as a
motivating factor, price and product selection have also been identified. This study considered convenience in
terms of time, space, and effort. It also identifies several specific sub-categories for price and products. Among
respondents who had made a recent online purchase, convenience-related issues were most frequently cited as
being relevant to the purchase decision. Product-related factors were important for nearly one-third of the
respondents. Price was of relatively little importance.
Consumers' Knowledge:: The Missing Element in Online Purchasing Expenditures.
(Journal of Information & Knowledge Management; Jun2011, Vol. 10 Issue 2, p159-168, 10p, 2 Diagrams, 2
Charts )
This study introduces two knowledge-related constructs (i.e., consumer competency and product knowledge)
into online purchasing expenditures and then analyses variables (i.e., convenience, trust, and privacy) that have
been discussed in existing literature in order to investigate how knowledge plays out in the online purchasing
context. The findings, derived from the responses of 124 survey participants, show that consumer competency
is the focal element of online expenditures. While convenient service is still one of the most important factors,
trust and privacy do not directly impact online expenditures. It is interpreted that competent consumers, who
are already determined to purchase something online, are able to locate trustworthy sites and make purchases
from those sites; consequently, these issues that are traditionally considered important do not necessarily
dissuade consumers' online expenditures, but may affect individual web sites. This study shows that
consumers' knowledge about technology and the Web are the main determining factors for online purchasing
expenditures.
Get Inside the Lives of Your Customers.
Harvard Business Review; May2001, Vol. 79 Issue 5, p80-89, 10p, 1 Diagram, 1 Chart, 1 Cartoon or Caricature
An Article by Seybold, Patricia B. :Many companies have become adept at the art of customer relationship
management. They've collected mountains of data on preferences and behavior, divided buyers into ever-finer
segments, and refined their products, services, and marketing pitches. But all too often those efforts are too
narrow--they concentrate only on the points where the customer comes into contact with the company. Few
businesses have bothered to look at what the author calls the customer scenario--the broad context in which
customers select, buy, and use products and services. As a result, consultant Patricia Seybold maintains,
they've routinely missed chances to deepen loyalty and expand sales. In this article, the author shows how
effective three very different companies have been at using customer scenarios as the centerpiece of their
marketing plans. Chip maker National Semiconductor looked beyond the purchasing agents that buy in bulk to
find ways to make it easier for engineers to design National's components into their specifications for mobile
telephones. Each time they do so, it translates into millions of dollars in orders. By developing a customer
scenario that describes how people actually shop for groceries,Tesco learned the importance of decentralizing
its Web shopping site and how the extra costs of decentralization could be outweighed by the higher profit
margins online customers generate. And Buzzsaw.com used customer scenarios as the basis for its entire
business. It has used the Web to create a better way for the dozens of participants in a construction project to
share their drawings and manage their projects. Seybold lays out the steps managers can take to develop their
own customer scenarios. By thinking broadly about the challenges your customers face, she suggests, you can
almost always find ways to make their lives easier--and thus earn their loyalty.
Marketing to mum.
B&T Magazine; 6/10/2011, Vol. 61 Issue 2743, p22-26, 5p, 12 Color Photographs
The article discusses how to influence a grocery-buying mother's preference for a brand when she goes to the
supermarket. It notes that mothers consume a wide range of media with the mainstream media such as
television, magazines and catalogues as the best option. The grocery-buyer mother also goes online to research
products either through investigation and social or word of mouth. It indicates the stages in
influencinggrocery-buyer mother's decision to buy including the awareness stage, the research stage where she
turns to the Internet and packaging.
Warfare in the aisles.
Economist; 4/2/2005, Vol. 375 Issue 8420, Special Section p6-8, 3p, 1 Color Photograph, 1 Graph
The article focuses on competition in the local supermarket. Female supermarket shoppers' interests range
from health, family matters and the environment to politics and social issues, such as the welfare of overseas
workers making some of the products they buy. They also share and discuss the information they acquire,
which is how they become attached to certain brands and products. Consumer-goods companies invest in
brands to convince supermarkets to stock their products and to get shoppers to buy them. To keep in touch
with customers, consumer-goods companies are shifting their spending away from traditional media to other
types of promotion. To make things more complicated, marketeers detect a growing trend towards "cross-
shopping": the same people buying very expensive and very cheap things at the same time. Some people avoid
supermarkets and buy groceries online. The internet has also enabled suppliers to go direct to the consumer.
To boost sales and negotiating power with supermarkets, consumer-goods companies are concentrating on
their most powerful "Superbrands". Some companies are trying a combination of old and new marketing
techniques.
These businesses are difficult to turn into profitable ventures due to the low margins and the logistics costs involved.Gaurav Saraf, director of Epiphany Ventures says that, the concept of online grocery shopping faces the
problem of turning their business into profitable ventures as the concept is new in the market which leads to
low margin along with low margin high cost is involved when it comes to logistics. In addition to these
problems the perishable items such as fruits & vegetables have a short shelf life, if these items are not
delivered before the expiry of their shelf life it would could cause wastage and also add up the cost. From the
above comment a conclusion is arrived that these business ventures have a very thin margin when it comes to
business operations.
Quality factorsHow to improve the online shopping experience.
Strategic Direction; 2013, Vol. 29 Issue 1, p27-29, 3p
Purpose – This paper aims to review the latest management developments across the globe and pinpoint
practical implications from cutting-edge research and case studies.Design/methodology/approach – This
briefing is prepared by an independent writer who adds their own impartial comments and places the articles in
context.Findings – The advent of internet shopping in recent decades has radically transformed the retail
landscape. Astute businesses have grasped the opportunities generated by this phenomenon. Some focus
exclusively on web-based activities, whereas others prefer a strategy blending new and conventional
channels. Online markets are advancing towards maturity though. The Less growth potential now exists as a
result. Another likely consequence is heightened competition. And what does all this mean? That company will
find it even tougher to secure custom from the diverse range of shoppers who make purchases online.
Satisfying the needs of customers should always be a priority. Within an increasingly challenging business
environment, it becomes even more critical.Practical implications – The paper provides strategic insights and
practical thinking that has influenced some of the world's leading organizations.Originality/value – The
briefing saves busy executives and researcher hours of reading time by selecting only the very best, most
pertinent information and presenting it in a condensed and easy-to digest format.
2.2 Models of E-commerce
Business-to-Business (B2B): B2B e-commerce is simply defined as e-commerce between companies. This is the type of e- commerce that
deals with the relationships between and among businesses. About 80% of e-commerce is of this type, and
most experts predict that B2B eCommerce will continue to grow faster than the B2C segment. Eg:
indiamart.com, eindiabusiness.com, tradeindia.com etc.
Business-to-consumer (B2C): Business-to-consumer e-commerce, or commerce between companies and consumers, involves customers
gathering information; purchasing physical goods (i.e., tangibles such as books or consumer products) or
information goods (or goods of electronic material or digitized content, such as software, or e-books); and, for
information goods, receiving products over an electronic network.
It is the second largest and the earliest form of e-commerce. Its origins can be traced to online retailing (or e-
tailing). Thus, the more common B2C business models are the online retailing companies such as flipkart.com
Amazon.com, snapdeal.com etc.
Business-to-Government (B2G): Business-to-government e-commerce or B2G is generally defined as commerce between companies and the
public sector. It refers to the use of the Internet for public procurement, licensing procedures, and other
government-related operations. This kind of e-commerce has two features: First, the public sector assumes a
pilot/leading role in establishing e-commerce; and second, it is assumed that the public sector has the greatest
need for making its procurement system more effective.
Web-based purchasing policies increase the transparency of the procurement process (and reduce the risk of
irregularities). To date, however, the size of the B2G commerce market as a component of total commerce is
insignificant, as government e-procurement systems remain undeveloped.
Consumer-to-Consumer (C2C): Consumer-to-consumer e-commerce or C2C is simply commerce between private individuals or consumers.
This type of e-commerce is characterized by the growth of electronic marketplaces and online auctions,
particularly in vertical industries where firms/businesses can bid for what they want from among multiple
suppliers. It perhaps has the greatest potential for developing new markets.
Online auction site eBay, Yahoo! Auctions are a couple of examples of C2C websites.
Mobile Commerce in India Mobile is growing in India with more than 800 million subscribers across the country. The advancement in
terms of adoption of smart phones with 3G enabled services is happening at a rapid pace. This of course opens
up the gates to mobile advertising, mobile application development and mobile commerce in India. According
to Buzz City's latest report, India is a top performing mobile advertising region in the whole of Asia. The
growth in mobile advertising globally is tremendous with the ads served on a year-on-year growth of 139%.
With respect to some number crunching, more than 126 billion ads were served in 2011, compared with 52
billion in 2010.
In India, Mobile Commerce is still in the development phase as the use of mobile phones for carrying out
transactions is very limited. However, the development is taking place at a nice speed and in the coming years,
Mobile Commerce is most likely to make its presence feel as companies and businesses have started
understanding the benefits of Mobile Commerce. Some of the companies have even incorporated this
technology. Airtel, ICICI, Reliance are some of the companies/businesses that are using this technology as
their users are allowed to make limited purchases from their phones. For now, the users are mainly allowed to
pay phone bills, utility bills, book movie tickets, book travel tickets with their cell phones.
However, more services will be introduced in the coming years. Security is one of the main concerns of
Mobile Commerce as it‘s very important to offer secure transactions and this is the reason why Mobile
Commerce is still in the development phase in India.
2.3 Overview Business-to-consumer (B2C)
Business or transactions conducted directly between a company and consumers who are the end-users of its
products or services. Business to consumer as a business model differs significantly from the business to
business model, which refers to commerce between two or more businesses (Source: investopedia).
The significant paradigm shift over the recent years from a brick-and-mortar to an e-commerce shopping
preference is clearly evident. As consumers continue to realize the many advantages of online shopping e-
commerce will continue to grow exponentially. The bottom line is, if you’re in the business of selling directly
to consumers and want to compete with the retail giants you must have the ability to respond quickly to the
growth and demands the e-commerce shift presents. Just as important as having an e-commerce presence is
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2.3.1 A Consumer Perspective of E-Service Quality
Zhang and Prybutok(2005) concluded e-service is an emerging and rapidly evolving area as demonstrated
by new technological innovations introduced to improve e-service. Motivated by the growing interest in online
commerce, we focus our research questions on examining the factors that contribute to e-service, the
relationships among these factors and the consumers’ attitude toward -service. To explore answers to our
research questions, we developed an e-service model. Specifically, our proposed model consists of such
constructs as individual differences, e-service convenience, Web site service quality, risk, e-satisfaction, and
intention. We develop an e-service quality survey instrument and use empirical data to validate the instrument.
The results of our empirical study validate our eight hypotheses. We confirm seven of the eight hypotheses.
One hypothesis that tested individual differences and service convenience was not confirmed. However, we
found that service convenience, Web site service quality, and risk are significant factors affecting consumers’
satisfaction level, which in turn affects intention. The findings suggest that managers need to understand e-
convenience from the consumers’ perspective. In order to provide better services for users, companies need to
invest in Web site service quality design and evaluation, and at the same time, control the perceived risk
associated with using it.
2.3.2 B2C E-Commerce Web Site Quality
Cao, Zhang and Seydel examined and integrated four sets of factors that capture e-commerce web site
quality using an IS success model: system quality, information quality, service quality, and attractiveness. A
questionnaire survey was conducted to verify the measures of web site quality. Based on TAM, a framework is
also developed relating web site quality to customers’ beliefs (perceived usefulness and ease of use), attitudes
(preferences for the site), and intentions (to revisit the site).
Findings – A set of instruments of web site quality has been developed and empirically validated by
factor analysis.Research limitations/implications – The research is based on a sample of students browsing
several book web sites and they may not sense the web site quality across different B2C commercial web sites
such as music, computer, travel, clothes and flowers. Data in these domains should be collected in any future
research to examine further the measures developed here. Practical implications – Guidelines for web interface
design are proposed.
2.3.3 Customer Expectations and Service Quality Dimensions Consistency
Sachdev and Verma-Service marketers bemoan what they perceive as an unprecedented increase of customer
expectations in many service industries. Customer expectations are on the rise with each competitive advance.
While at most everybody has an intuitive sense of what expectations are, service marketers need a far more
thorough and clear understanding of expectations in order to comprehend the concept of service quality and to
measure and manage it. A literature review suggests that the measurement of service quality is full of
controversy associated with many issues, of which an important few are : the type of expectations customers
hold in the evaluation, important manageable service quality dimensions /attributes that define it in its full
framework and dimensional consistency across the service categories.
2.4 Online Shopping In India
The Indian economy is slated to grow by upward of 6 % annually in the next few years which is among the
highest rates of any big emerging economy. And quite a lot of this growth would be on the back of domestic
consumption of goods and services. E-commerce is emerging as a great level given that organized retail is still
not ubiquitous across the length and breadth of the country with large retail chains making up less than 10% of
the market.
E-commerce is helping people in smaller towns in India access quality products and services similar to what
people in the larger cities have access to. It‘s been forecast that close to 60% of online shoppers would come
from beyond the top eight large cities by the end of this year.
Increasing internet penetration has helped to expand the potential customer pool. Internet penetration is only
about 10% (or about 121 million users) as against about 81% in the US and 36% in China. However this
number continues to rise at a consistent pace because of falling prices for broadband connections.
Indians are also increasingly taking to mobile devices for not only search but shopping as well. The number of
Smartphone users is rapidly increasing in India and with 4G services about to take off it‘s expected to get even
more people going online. There are currently about 900 million mobile subscribers and this number is
expected to touch 1.2 billion by 2015. Of these about 27 million are estimated to be active mobile internet
users. More importantly, 20% users indicated intent to buy products through their mobile phones as against the
current 4% and this number is expected to only increase in the next two to three years.
Innovation is helping e-commerce companies break the inertia for online shopping by offering benefits to
customers not traditionally available in a brick and mortar store. Business models include no question asked
return policies ranging from 7 days to 30 days, free product deliveries and the industry dynamics changing
―cash on delivery model. The last innovation has really helped unlock the potential as people can now order
products and pay when they get physical delivery of the product.
This has been a tremendous success because Indians are still reluctant to give their credit/debit card details
online and want to have the psychological comfort that they would actually get the product once payment has
been made. These innovations have led to further innovations downstream as ancillary businesses are
developing to support these initiatives. Some companies have begun to develop support mechanisms for the
entire cash on delivery model and are trying to reach the far flung corners of India, including in the interiors
where traditional logistics companies are still not completely present. The logistics companies are also shoring
up their act and have started to build specific verticals and expertise to address the requirements of e-
Commerce companies.
Divyan Gupta is the Founder and CEO of Keshiha Services Pvt. Ltd, a company with interests in the internet,
telecom, healthcare, education and advanced technology businesses has stated that, acceptance of online
shopping as a secure shopping mode is has also helped to increase e-commerce uptake.
Currently only about 10 million people do online transactions out of an approximate population of 200 million
credit and debit card holders. However the latest industry report by First Data Corporation and ICICI Merchant
Services indicate that there are about 150 million users that are ready for e-commerce.
More importantly the report indicates that urban Indian consumers are now confident enough to make online
purchases of up to US$500 as against US$40-100 in the recent past. So not only are the numbers of online
shoppers projected to increase but there has been a real increase in the total value being spent online.
2.5 Online Grocery Shopping
Proving that no sector of the retail market is safe from the online shopping revolution, it is now possible for the
humble hometown grocery store to become digitized and available on your Smartphone, tablet, or computer.
Just think: no longer checkout lines, counting the number of items to see if you qualify for the Express Lane,
forgetting your grocery list at home, or carrying heavy bags up your front steps. Online grocery shopping is
dramatically changing the consumer's relationship with the food market and making a service that may have
once felt luxurious into an everyday convenience.
Ordering Food Online
An online grocery store is a website that allows users to purchase food over the Internet to be delivered to the
person at a later time. Ordering food on the Internet is similar to ordering any other product--the desired food
items can be searched for specific, or one can browse through listings of products or sections, similar to
sections one might walk through at an actual grocery store. The products offered by an online grocery store are
identical to a normal grocery store. When one has finished shopping, checkout is made with a credit card, and
the buyer must specify certain hours that he will be available to receive the food for delivery. Since Internet
groceries must deliver the food to the customers, they typically pay a fee for delivery based on the amount of
food they buy.
Benefits of Online Grocery Shopping
The primary benefit of online grocery shopping is convenient. By ordering online, one can quickly search for
the products she needs and order them without having to physically walk through expansive aisles. It also
saves travel expenses and time going to the grocery store. Considering the wide availability of the Internet, it
also means grocery shopping can be done from remote locations or in the middle of doing other tasks. For
instance, using an online grocery store can allow a person to do all her grocery shopping during her lunch
break at work.
It is also very useful for those without a car or who may be physically unable to move around easily, since the
food is delivered right to their doors. The use of online-based grocery stores are increasing in popularity as
more and more people become comfortable with using the Internet to make purchases.
Disadvantages of Online Grocery Shopping
Perhaps the largest disadvantages of shopping online are that it costs extra money, since food must be
delivered, and that the food ordered is not obtained immediately. If someone were making a certain recipe and
discovered he needed an additional ingredient, he would probably not be able to order it online and get it
quickly enough to finish his dish. In the same way, it forces a person to plan his food buying in advance of
when he will need it--if delivery will take a day or two, a person needs to plan to have an extra day or two of
essential foods available before he runs out. Another disadvantage is that online shopping forces the customer
to be home during a certain period to collect the food when it is delivered. Also, online grocery stores will
often only cover specific delivery areas.
How Does Online Grocery Shopping Work?
Following is the basic parameter that determines the working of online grocery shopping.
Creating the Website
The most important part of online grocery shopping is the website itself. The website should have a complete
list of groceries that are able to be delivered as well as the prices for each item. This website should then have
a "shopping cart" where a user can add items to a list of things to be ordered, as well as view and edit items
that she is planning to purchase. Finally, this website should have the ability for the user to enter her address
and pay for the order.
Filling the Order and Shipping
The next step is to take the submitted order and use it to collect and deliver the items on the list. In general,
fulfillment of the grocery order needs to be done manually by a stock boy or other employee.
This process can be made easier by having a well-organized room where the products can be easily and
efficiently located. The stock person should also check to make sure that the items placed in the order match
the list that the user created.
Then, once the order has been compiled, the collection of food needs to be placed in a vehicle and delivered to
the customer.
Restocking and Processing Payments Clearly
It is critical to ensure that all the items listed on the website are in stock and able to be shipped. As a result,
the stock room needs to be carefully checked to ensure inventory levels are sufficient.
Also, it is important to have the ability to obtain and process payments made by credit card. Also, in order to
encourage repeat customers, it can be helpful to require customers to have a user name, which would allow
information to be stored. This can also help create "suggested" carts of food items they commonly purchase.
2.5 Indian Players in Online Grocery Shopping
Fresh n daily
Fresh N Daily is Mumbai‘s first online fruits and vegetable store. Our endeavor is to service you at the comfort
of your home with the best quality products and at the best possible prices.
They procure goods directly from the farmers/ brand owners and ensure there are no intermediaries.
Moreover, unlike a physical store – supermarket neighborhood Kirana store sabziwala - we are an online store.
This means that the cost structure is very lean: low rental costs, low manpower costs, low overheads etc. The
prices are therefore the most competitive.
Thirty-year-old VikasChauhan, who quit an IT company, has a delivery van that procures vegetables from
local Mandi, brands them with FreshnDaily packets and delivers to areas it has identified as key zones. It has
just two delivery boys who supply in key zones. For the rest, it has tied up with small nook and corner shops.
At Ghatkopar, for example the helper of the corner mobile recharge shop collects the vegetables from the
delivery van and delivers door to door. Friendly pays the errand boy a monthly salary and the mobile shop gets
the boy‘s services for free. The shop even gets an incentive when deliveries cross Rs 5,000 a day.
Farm2Kitchen.com
Farm2Kitchen Team is led by SeemaDholi (Founder & CEO), a woman entrepreneur who is committed to the
betterment of the lives of Indian families. She started Farm2Kitchen with only one mission - To enhance the
quality of life for Indian families and provide the best customer service possible.
Farm2kitchen.com, which deals only in organic groceries and textiles, and caters to Gurgaon and surrounding
areas. Founder SeemaDholi, who hails from Pearl Academy of Fashion and has several other ventures in her
basket, such as Divavee and Fashion Per Inch India, wants to educate local consumers about the benefits of
organic groceries and then spread the message to the rest of the country. Set up in 2011, Farm2kitchen is now
looking for funds, but even before that, Seema wants to expand operations and go pan-India.
They support organic farming & agriculture as organic farming is a holistic approach to food production,
making use of crop rotation, environmental management and good animal Husbandry to control pests and
diseases.
Some of the cities which will be covered under Farm2Kitchen's umbrella for organic food are -Organic food
stores/shops in New Delhi, Mumbai, Chennai, Kolkata, Bangalore, Gurgaon, Hyderabad, Pune, Aurangabad,
Ahmedabad, Kolkata, Nasik, Vadodara, Gandhinagar (Gujarat), Visakhapatnam, Chandigarh, Bhopal, Jaipur,
Lucknow, Dehradun, Thiruvananthapuram.
BigBasket.com
BigBasket.com (Innovative Retail Concepts Private Limited) is India’s largest online food and grocery store.
With over 10,000 products and over a 1000 brands in our catalogue you will find everything you are looking
for. Right from fresh Fruits and Vegetables, Rice and Deals, Spices and Seasonings to Packaged products,
Beverages, Personal care products, Meats – we have it all.
Choose from a wide range of options in every category, exclusively handpicked to help you find the best
quality available at the lowest prices. Select a time slot for delivery and your order will be delivered right to
your doorstep, anywhere in Bangalore, Mumbai & Hyderabad. You can pay online using your debit / credit
card or by cash / Sodexo on delivery. We guarantee on time delivery, and the best quality! Happy Shopping!
My Grahak
It’s an online grocery store from Rei Six Ten Retail Ltd., a retail chain network of about 350 stores in the
NCR, Punjab, Baddi and Nagpur. This is one of the first attempts from a retail grocery giant to enter the online
space and leverage their existing network of offline stores. Mr. AmbujJhunjhunwala is the founder & CEO of
MyGrahak.com
MyGrahak covers the basic FMCG categories of food, non-food and grocery. The delivery is currently offered
in Delhi-NCR only. The site comes with the regular frills of an online store, viz. Discount on all products (min.
4%), 48hrs delivery, CoD, customer support etc.
The portal boasts of 7000+ products.
Key figures of MyGrahak
5000 transactions per month growing at over 30% month on month
Loyalty rate - repeat purchases have increased to 50% from 30% in last 2 months
8,500 registered families
10,000 SKUs (Stock Keeping Units) - target of 35,000 SKUs
Delivery vehicles fitted with GPS
Chapter 3
Research Plan
3.1. Research Objectives To study the attitude of customers towards online shopping.
To identify the issues faced by the user while Sopping online
Identify the parameters for which influences purchase behavior of the Online Grocery Store.
3.2 Research Scope To determine which factor influences the consumer to go for online shopping.
To find out which feature of the website attracts the user to purchase the product from the online shopping
website.
To find out the whether grocery online shopping is beneficial for the user.
To analyze which factors influence the user to buy online grocery.
3.3 Research Design and MethodologyThe sources of data used in this project report are both primary and secondary data.
1. Primary data
Primary data consist of original information gathered from a sample size of 200 respondents residing in Delhi,
India.
2. Secondary data
Secondary data consists of information that already exists and that was collected in the past for some other
purposes.
3.4 Sampling
Sample Design:
Size of Sample: The sample size selected for the research is 200 in the area of South Delhi.
Parameters of Interests: The major parameter of interest is the subgroup of people
Who are working professionally and web savvy having an experience in online
Shopping. The two other subsidiary parameters of interest are:
The respondent should also have an experience grocery shopping.
And the female respondent who has an online shopping experience.
Sample unit:
1. Working People (Including Men & Women)
2. House Wife’s
3. College Students
4. Senior Citizens
Sample size: 200
1. Working People: 32%
2. House Wife’s: 29%
3. College Students 23%
4. Senior Citizens: 16%
Sampling Technique:
Quota Sampling:
Quota sampling is a method for selecting survey participants. In quota sampling, a population is first
segmented into mutually exclusive sub-groups, just as in stratified sampling. Then judgment is used to select
the subjects or units from each segment based on a specified proportion
3.5 Questionnaire Design
The questionnaire was administered by focus group consisting of two faculty members, two from online
industry and two users. Questions in the questionnaire have been kept simple so that they are understandable to
all respondents. This was made to keep the survey simple and user friendly. Also technical jargons are avoided
to ensure that there is no confusion for respondents.
Chapter 4
Analysis and Findings
4.1 Demographic observations
1. Gender
Table 1: Gender Distribution
Figure 1: Gender Distribution
Graphical Presentation
The above diagram depicts that out of the total 200 respondent 42% of the respondent were female as the
objective was to study the consumer behavior with respect to online grocery, as grocery is more shopped by
female respondent.
58%
42%
GENDER
Male Female
Male Female Total
116 84 200
2. Age Brackets
Table 2: Age Distribution for sample
Figure 2: Age distribution of sample
Interpretation
The 38 % of the respondent were among 30 & above age bracket as these respondents are well
educated and web savvy.
Another 46% of the respondent were ranging from 18-24 age bracket and the remaining 16 % were
respondent were ranging from 25-30 age bracket, as these respondents are ready to adapt changes.
18-24 25-30 30& above0
10
20
30
40
50
60
70
80
90
100
Series1
Age Respondents
18-24 92
25-30 76
30& above 32
4. Occupation
Occupation Respondents
Services 124
Business 76
Total 200
Table 3: Occupation of sample
Figure 3: Occupation of sample
Interpretation
For the research to be successful most of the respondents are working officials who are educated and web
savvy.
Services62%
Business38%
OCCUPATION
5. Annual Income
Table 4 : Average Annual Income of sample
Figure 4: Average Annual Income of sample
Interpretation
1-5 lakhs38%
5-10 Lakhs41%
10 & bove21%
ANNUAL INCOME
Annual Income Respondents
1-5 lakhs 76
5-10 Lakhs 82
10 & above 42
From the above pie chart we can determine that 48 % of the respondent have around 5-10 lakhs of annual
income which indicates the majority of the respondent have the spending power to purchase grocery items.
4.2 Questionnaire Analysis
Q1. Which item you shop online?
Items No. of Respondents
Apparels 48
Books 28
Electroni
c56
Food 16
Games 32
Music 12
Other 8
Table 5:
Popular Items onlineApparels Books Electronic Food Games Music Other
0
10
20
30
40
50
60
No. of Respondents
Figure 5 : Popularity of online items
Interpretation The above diagram depicts that book has the highest number transaction in online shopping.
Music is the second most item sold in the online shopping, along with electronics appliances like hair
dryer, mobile appliances, computer peripherals etc.
The other items that are sold in the online shopping are the apparels which are more preferred by the
female respondent.
Games are the items that are preferred with the respondent ranging the age bracket between
Q.2. The amount spent in the online shop
Amount(Rs) Number of respondent
100-500 48
500-1000 68
1000-5000 36
5000 & above 48
Table 6: amount of money spent on online shopping
Interpretation
The money spend in online shopping is ranging from INR 1000-5000, which indicates the users are willing to
pay more price when there is premium quality products such as electronics, branded apparels, original music
etc.
Q.3 .When do you feel the need to shop online?
No. of respondents
When I need home delivery 68
When I want something unique and special 48
When I need to compare prices 24
When I don’t have time to find things in different market 40
Others 20
Table 7 :Need of shopping online
100-500 500-1000 1000-5000 5000 & above0
10
20
30
40
50
60
70
80
Money spent onnline shoping
Number of respondent
Figure 6: Amount of money spent on online shopping
Figure 7: Need of shopping online
Interpretation
From the above we can depict the factor which motivates the respondent to shop online is when they need home
delivery.
The other factor which motivates to shop online when they compare prices of different products at a same place.
The above graph also determines that people shop online when they don‘t have the time to find things in the market
for the product to be purchased.
020406080
Need to shop Online
No. of respondents
Also respondent shop online when they want some unique & special product which they cannot find in the offline
market
Q.4. What features on the online shopping website attracts you?
Very
Important
Somewhat
Important
Not
Important
Website user Friendly 110 60 30
cash on delivery 75 105 20
credit / debit card payment 82 82 36
offers and discounts 93 71 36
Free shipping 144 29 9
Table 8: Features of websites attracting users
Website user Friendly
cash on delivery credit / debit card payment
offers and discounts
Free shipping 0
20
40
60
80
100
120
140
160
Very Important Some what Important Not Important
Figure 8: Features of websites attracting users
Interpretation
The above diagram depicts that website user friendliness forms an important factor when it comes to
online shopping, more the website user friendliness will determine the number of visits to a website
which will in turn results an increase in the sale transactions for the particular shopping site.
Cash on delivery forms an important aspect of the online shopping website in the Indian online shopping
market, the above graph depicts that it does forms an most important part on the online shopping.
The other mode of payment gateway through net banking and credit/debit banking also forms an
important part of the online shopping website.
When it comes to tracking the items service in online shopping most of the respondents think that it is an
important service which allows the user to track their items in transit.
When it comes to the security aspect of the website Id & password forms an important aspect of the
online transaction. The other aspect order confirmation is the like the shopping cart where the user gets
the list of items he/she is going to purchase which avoids unnecessary purchase of the product , also
forms an important part of the online shopping website.
The above graph depicts that along offers & discounts, free shipping also forms as the most important
factor for the online shopping website, which forms a motivating factor for the user to shop
Q.5. While shopping what affects your satisfaction the most?
Table 9: Features effecting the satisfaction most
Features No. of respondents
Design of website 52
Discount offers 48
Advertisements 64
Range of Products 24
Value of money 12
Figure 9: Features effecting the most satisfaction
Interpretation
From the above diagram we can determine that people prefer online shopping when discounts offered are offered to them.
Also the variety of product offering to the customer also forms an important factor which motivates the respondent to shop online.
The other factor that motivates the user to shop online is when the product they purchase is of value of money.
Also the design of website along with the different advertisement promotion motivates the user to shop online.
Q.6. What are your issues regarding online shopping?
Issues No. of respondent
No guarantee 48
Possibility of forgery 52
Highly priced prodcut 44
Too much clutter 28
Security issue 20
Physical Examination 8
Table 10: Issues considered while shopping online
Design of website
Discount offers
Advertisments
variety
Value of money
52
48
64
24
12
Website FeaturesNo. of respondents
Interpretation
The other factor which demotivates the user to shop online is the security issue, which consists of issues like
phishing, hacking of accounts etc.
Q7. Where do you shop for grocery items?
Shops No of respondents
Local Kirana 80
Ration Shop 21
SabziMandi 49
Super Markets 50
Table 11: Shops preferred for grocery items
24%
26%22%
14%
10%4%
Issue shoping online
No guarantee Possibility of forgery Highly priced prodcut To much clutter
Security issue Physical Examination
Figure 10: Issues considered while shopping online
Figure 11: Shops preferred for grocery items
Interpretation
The above graph depicts that most of the respondents shop from supermarket for grocery items. The
reason for shopping from the particular shopping centre can be depicted below.
Q.8. If given an option to buy grocery online will you buy online?
Yes 68
No 88
May be 44
Table 12: Preference to buy grocery online
Local Kirana Ration Shop Sabzi Mandi Super Markets0
102030405060708090
80
21
49 50
No of respondents
Interpretation
The remaining percentage of the respondent may or may not buy grocery online due the factors like
physical examination and security issues.
The above graph depicts that around 34% of respondent are willing to buy grocery online if the option is
given.
Q.9.Do you think buying grocery online is beneficial?
Table 13: Opinion on buyng grocery online
Yes34%
No44%
May be22%
Yes 136
No 64
Figure13: Opinion on buyng grocery online
Graphical Presentation
The above diagram depicts that most of the respondent think that buying grocery is beneficial which can
be determined from the next question.
The remaining respondent thinks that online grocery shopping will be not beneficial due the factors like
forgery products, highly priced products and no guarantee ofthe product.
Q10. If yes why do think is beneficial?
Yes68%
No32%
Parameters No. of repondents
Easy to order 68
Variety 48
Discount & offers 52
Saves time 20
Avoide long queues 12
Table 14: Parameters beneficial for shopping online
Figure 14 : Parameters beneficial for shopping online
34%
24%
26%
10%
6%
Parameters
Easy to order
Variety
Discount & offers
Saves time
Avoide long queues
Graphical Presentation
The above graph depicts that user respondent think that online shopping will be beneficial as it will save
their time to shop for grocery items.
The next relating aspect why consumer will shop grocery online as it will allow the user to avoid long
queues resulting in reduction in time spent in shopping.
The other factors why online grocery shopping will be beneficial as it will allow the user to shop all the
grocery at a particular place with discounts and offers.
buying grocery online beneficial
options to buy online
Home Delivery -.114 .215**Something unique and special -.033 .128To compare prices -.091 -.054 Time constraint .196** .520**others .123 .504**User friendly website .646** .379**Cash on Delivery -.089 -.108Online payment options .472** .344**offers .341** .260**Free shipping .230** .260**Design of website .315** .731**Discount .248** .596**Advertisements .287** .844**Range of Products .141* .489**Value of Money .106 .413**No guarantee .248** .596**Security issue .154* .482**High priced Product .222** .576**To much clutter .095 .488**Physical Examination .130 .464**
Table 15: Correlation of factors with attitude of online users
From the correlation table it was seen that all the factors influence the decision of an online user to shop online and the satisfaction. It was however seen that factors like facility of home delivery, provision of comparing prices and cash on delivery did not correlate with online buyer attitude. This can be explained as the hich anyhow is also available in offline stores.
How significantly the factors contribute is given in the next table.
Model
Unstandardized Coefficients
Standardized
Coefficients
t Sig.B Std. Error Beta
(Constant) 1.197 .321 3.726 .000
Home Delivery -.168 .078 -.161 -2.148 .034
Something unique and
special
.061 .080 .060 .766 .445
To compare prices -.046 .057 -.056 -.813 .417
Time constraints .050 .118 .055 .419 .676
Others -.132 .200 -.128 -.658 .512
User friendly website .568 .102 .672 5.587 .000
Cash on Delivery -.068 .098 -.048 -.699 .486
Online payment options .007 .104 .008 .065 .948
offers .003 .105 .004 .029 .977
Free shipping -.020 .093 -.028 -.217 .828
Design of website .201 .153 .232 1.311 .192
Advertisements -.116 .100 -.140 -1.152 .251
Range of Products -.060 .336 -.061 -.179 .858
Value of Money -.066 .127 -.061 -.521 .603
No guarantee -.037 .206 -.042 -.177 .860
Security issue .378 .345 .403 1.095 .276
High priced Product -.077 .205 -.087 -.373 .709
To much clutter -.136 .117 -.153 -1.160 .248
Physical Examination -.157 .199 -.136 -.789 .431
Table 16 : Regression table
The t-test values were not found to be significant primarily because in India online grocery is a budding concept and has not been familiarized with users. It holds promise of expansion.
Chapter 5
CONCLUSION
5.1 Summary
From the above data analysis it can be conclude that consumer buys goods from the online shopping website
on the basis of factors like offers and discounts, variety of product available, free home delivery, website user
friendliness and
The hypothesis framed for the project Consumer Perception towards Online Grocery Shopping was Online
grocery shopping stores are beneficial for the consumer‖.
From the above data analysis it can be determined that most of the respondent would agree to buy grocery
online rather than shopping of grocery with the traditional method.
Out of the agreed respondent to buy online grocery, most of the respondent would think that it would be
beneficial to shop grocery online on the basis of factors like easy to order, variety, discounts/ offers, saves time
and avoid long queues. With above analysis we can thus prove the hypothesis to be positive.
5.2 Limitations
The first limitation caused during the market research was to find out the respondent who shop online and
are web savvy.
The second limitation caused during the research was searching the women respondents who shop grocery
products along with the experience of online shopping.
Other limitation caused in the market research was that the research will only study the consumer
perception towards online grocery shopping and not the dealers, wholesalers or retailers’ perception
towards online shopping which acts as an agent to the online retail industry to support its business
operations.
5.4 Major Findings
From the data collected above we can observe that there is an increase in the number of respondent in
online shopping as there is awareness about this concept in the market.
Certain parameters which motivates the user to shop online are:
User friendliness of the website.
Discounts and offers, offered by the website.
Cash on delivery form an important gateway in online transaction.
Free shipping is the most important factor which motivates the user to shop online.
Physical examination is the important issues in the online shopping which determines the tangibility of
the product.
The data depicts that supermarket are the preferred shopping destination as it offers all the basic aspect
of the online shopping which are price, quality variety, proximity to home, offers & discounts.
From the above data collection we can determine most of respondent agree to buy grocery online if the
option is give.
The data also determines the factors which will be beneficial for the consumer to shop grocery online
which are variety at one shop, saves times and avoid long Queues.
5.5 Future Scope
Experts predict a promising and glorious future of ecommerce in the 21st century. In the foreseeable future
ecommerce will further confirm itself a major tool of sale. Successful ecommerce will become a notion
absolutely inseparable from the web, because e-shopping is becoming more and more popular and natural. At
the same time severe rivalry in the sphere of ecommerce services will intensify their development. Thus
prevailing future trends of ecommerce will be the growth of Internet sales and evolution.
Each year number of ecommerce deals grows enormously. Sales volumes of on-line stores are more than
comparable with those of “brick-and-mortar” ones. And the tendency will continue, because a lot of people are
“imprisoned” by work and household duties, while Internet saves a lot of time and gives opportunity to choose
goods at the best prices. Present-day Internet sales boom is the foundation for magnificent ecommerce future.
The “quantity to quality” tendency of ecommerce is also becoming more and more obvious, as the Internet has
excluded geographical factor from the sale. So it doesn’t matter any more whether your store is situated in
New York or London or in a small town. To survive, merchants will have to adapt rapidly to the new
conditions. To attract more customers e-store-owners will have not only to increase the number of available
services, but to pay more attention to such elements like attractive design, user-friendliness, appealing goods
presentation, they will have to opportunely employ modern technologies for their businesses to become parts
of ecommerce future.
Of course, those, who acquire e-stores earlier, get better chance for future success and prosperity, though an
ecommerce site itself doesn’t guarantee you anything. Only an appropriate ecommerce solution in combination
with thorough emarketing and advertising can buy you business insurance
APPENDICES
Questionnaire on Online Grocery Store
Name:
Gender:-
□Male
□ Female
Age:-
□18-24
□ 25-30
□ 30 and above
Occupation:-
□ Student
□ Service
□ Business
Income Level:-
□ 1 lakh - 5 lakhs
□ 5 lakhs - 10 lakhs
□ 10 lakhs and above
Q1. Which item you shop online?
□Apparels
□Books
□Electronics
□Food
□Games
□Music
□Any other(Please specify)
Q2. How much money do you spent in online shopping? (Rupees)
□100 - 500
□500 - 1000
□1000 - 5000
□5000 & above
Q3. When do you feel the need to shop online?
Agree Neutral Disagree
When I want something unique and special
Value for money
When I need to compare prices
When I don‘t have the time to find things by
different market
Others
Q4. What features in online shopping website attracts you?
Agree Neutral Disagree
The design of a website
Discounts offered
Advertisement
Variety
Value for money
If others specify …………………………………………………………………………..
Q5. While shopping what affects your satisfaction the most?
Disagree Neutral Agree
Website user Friendly
Cash on delivery
Credit / debit card payment
Offers and discounts
Free shipping
Q6. What are your issues regarding online shopping?
Disagree Neutral Agree
No guarantee
Possibility of forgery
Product highly priced
Too much clutter
Security issue
Physical examination
Any other (Please specify)
Q7. Where do you shop for grocery items?
Local Kirana
Ration Shop
Sabzi Mandi
Supermarkets
Q9. If given an option to buy grocery online will you buy online?
Yes
No
May be
Q10.Do you think buying grocery online is beneficial?
□Yes
□No
Q11.If yes, why do you think is beneficial?
□Easy to order
□Variety at one shop
□Discounts & offers
□Saves time
□Avoid long queues
□Any other (Please specify)
Bibliography:Reference Books:
Marketing Management: Philip Kotler
Basic of Marketing: Dr. P. C. Pardeshi
Reference Links:Sasser, W. Earl, Jr., Olsen, R. P. and Wyckoff, D. D. (1978), Management of Service Operations: Text and Cases. Boston: Allyn & Bacon.
Lehtinen, U. and Lehtinen, J. R. (1982), “Service Quality: A Study of Quality Dimensions,” unpublished working paper, Service Management Institute, Helsinki, Finland.
Lewis, R. C. and Booms, B. H. (1983), “The Marketing Aspects of Service Quality,” in Emerging Perspectives on Services Marketing, Leonard L. Berry, G. Lynn Shostack, and Gregory Upah, eds. Chicago: American Marketing Association, 99-107.
Parasuraman, A.. Berry, L. L .and Zeithaml, V.A. (1988), “SERVQUAL: A Multiple-Item Scale for Measuring Service Quality,” Journal of Retailing, 64 (1), 12-40.
Parasuraman, Zeithaml & Berry (1985). A conceptual model of Service quality and its implication for future research. Journal of Marketing, 49(4), 41-50.
Parasuraman, A.. Berry, L. L .and Zeithaml, Valarie A. (1991), “Refinement and Reassessment of the SERVQUAL Scale,” Journal of Retailing, 67(4), 420-50.
Ennew, C.T., Reed, G. V; and Binks, M.R (1993). "Importance-Performance Analysis and the Measurement of Service Quality", European Journal of Marketing, Vol. 27 (2) pp.59 – 70.
Web Linkshttp://www.firstpost.com/tech/indias-e-commerce-market-to-touch-260-bn-by-2025-report-255350.html.
http://online.wsj.com/article/SB10001424052702303816504577308652286295634.Html
http://www.businessworld.in/businessworld/businessworld/content/Services- Economy-Moves-Online.html?storyInSinglePage=true
http://trak.in/tags/business/2011/08/23/india-online-internet-users-survey-report-
2011/
