Volume 4, Number 1, January – March’ 2015

ISSN (Print):2319-9032, (Online):2319-9040

PEZZOTTAITE JOURNALS SJIF (2012): 3.562, SJIF (2013): 5.074

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ONLINE MARKET: A COMPARATIVE STUDY OF CONSUMER BEHAVIOUR

FROM RURAL AND URBAN AREAS

Pooja Darda15 Vimal Deep Saxena16

ABSTRACT

E-commerce has been expanding its wings all around the globe. The availability of various options and information about the

products is making this trend more user friendly. As result of that, there are so many big names, which can be seen in the

market like Flipcart, Snapdeal, Amazon.in, Shopclues and many more. By looking at the current scenario, a certain question

arises that how the behavior of consumer also changes when they shift their purchasing from physical market to online market.

We stated this study when we randomly interacted with various people and talked about their idea of purchasing online. Our

random conversation with different kind of people led us to think about the difference between the consumer behavior of rural

and urban consumers. Therefore, this study is focusing on the uses of online marketing by rural and urban customers and the

differences in their behavior. We have identified 3 areas in city region and 8 areas in rural or a like region in and around Pune

to do this study. A hypothesis is tested to understand whether there is any difference between rural and urban consumers‘

behavior in online purchasing. This research is carried out at the S. R. Thorat Milk Products Private Limited, to study the

perception of retailers and customers about the company and its products.

KEYWORDS

Online Purchasing, Consumer Behavior, Rural and Urban Consumers etc.

INTRODUCTION

In the era of internet and high tech technology, marketing is not just restricted to the market place only. The tastes of consumers

have been changing. The liking, disliking, patterns of purchase have emerged as the key fact for purchasing the products, which

ultimately helps consumers to choose their desired products. Taking purchasing decision from the different available markets has

been identified as one of the most important issues in today‘s era. In the development of information and communication

technology, the habit of purchasing the products is becoming more complex. Several options and easy accessibility to the market

through internet and e-commerce websites have made it bit tough to the physical market to sell the products. However, the likings

and disliking of different kind of customers for different market is different. To understand this behavioral change in the

purchasing decision of consumers, one must identify related factors, which have profound impact on the purchasing decision of

consumers. Though there have been many studies conducted in this area but this study is focusing more on to understand the

different consumer behaviors for online and physical market in selected areas rural and urban areas in Pune district. To seek out

the different purchasing patterns used by rural and urban customers for online purchasing, this study has been undertaken.

REVIEW OF LITERATURE

Consumer behavior has been always of great interest to marketers. The knowledge of consumer behavior helps the marketer to

understand how consumers think, feel and select from alternatives like products, brands and the like and how their environment,

the reference groups, family, and salespersons influence the consumers and so on. A consumer‘s buying behavior is influenced by

cultural, social, personal and psychological factors. Most of these factors are uncontrollable and beyond the hands of marketers

but they have to be considered while trying to understand the complex behavior of the consumers. Consumer is the study ―of the

processes involved when individuals or groups select, purchase, use, or dispose of products, services, ideas, or experiences to

satisfy needs and desires‖ (Solomon 1995, 7). Consumer behavior for purchasing online is slight different from purchasing from

physical market. Consumer perception and promotion techniques are slight different in online market. If we see the perception and

promotional activities for both rural and urban consumers, then we find that the overall understanding by both kinds of consumers

about the online market is different.

The topic of online consumer behavior has been examined and researched under various contexts a variety of business disciplines

have made significant progress in understanding the scope of these studies. Based on articles studied, we provide a review of the

literature and propose a research framework with three key building blocks (intention, adoption, and Continuance) to analyze the

online consumer behavior in a systematic way. Researchers such as Goldsmith (2000) and Limayem et al. (2000) found that

personal innovativeness is a key personality trait that explains consumer online purchase intention. Consumers from urban areas

specially found to be more intent for online purchase rather from rural. Chau et al (2000) examined the effects of presentation

mode, search engines, and navigation structure of product items on the adoption of Internet shopping. Jarvenpaa et al (2000)

15Assistant Professor (Marketing), Sinhgad Business School, Maharashtra, India, poojadarda@sinhgad.edu 16Assistant Professor (I.B.), Sinhgad Business School, Maharashtra, India, vimal.dsaxena@gmail.com

Volume 4, Number 1, January – March’ 2015

ISSN (Print):2319-9032, (Online):2319-9040

PEZZOTTAITE JOURNALS SJIF (2012): 3.562, SJIF (2013): 5.074

International Journal of Logistics & Supply Chain Management Perspectives © Pezzottaite Journals. 1489 |P a g e

concluded that trust in an Internet store is a salient and most important determinant of online shopping for both urban and rural

consumers. Finally, many researchers focused on online repurchase and contended that consumer trust and consumer satisfaction

is the major key antecedents of continued purchase.

Figure-1: Framework of Online Consumer Behavior

Sources: Authors Compilation

OBJECTIVES OF STUDY

To understand the functioning of online purchasing.

To find out the difference between the consumers behavior of rural and urban consumers while purchasing online.

HYPOTHESES OF STUDY

H0: There is no difference between the consumer behavior of rural and urban people while purchasing online.

H1: There is a difference between the consumer behavior of rural and urban people while purchasing online.

METHODOLOGY OF RESEARCH

To conduct this study descriptive research methodology is been used wherein the data has been collect from the defined sample

for the research.

Sample: For the data collection, a sample frame of eleven rural and urban areas prepared comprising of three urban areas in Pune

city (Kondhwa, Pimpiri and Chinchawad) and 8 rural areas (Shivane, Narahe, Ambegaon, Khed Shivapur, Donje, Talegaon,

Ranjangaon, Uruli Kanchan) located in the vicinity of Pune. All these places have been selected randomly by considering the

convenience for data collection.

Data Collection: Data for conducting this research was collected from both the crucial sources.

Primary Data: Primary data was specifically collected with the help of a structured questionnaire. A questionnaire was prepared

with total 11 question related to the factors that could affect consumer behavior or purchase decision of a consumer. Those 11

questions were framed on seven point Likert scale summed rating scale (where 1= strongly disagree to 7= strongly agree). The

structured questionnaire was then sent to the people staying in the mentioned sample area mentioned earlier. Finally, exactly 202

useable questionnaires were obtained from the people as a response for the study. Out of 202 the responses came from urban areas

were 69 whereas 133 from rural areas.

Secondary Data: Secondary data for the research have been collected from various sources such as internet, e-library, books and

various published research papers in the same field.

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Reliability & Validity

Before applying any statistical tool, testing and checking the reliability of the tool is most important. To understand the extent of

the statistical tool to produce the consistent result, the measurement was done repeatedly. This is done by determining the

association in between scores obtained from different administrations of the scales. If the association is high, the scale yields

consistent result, thus is reliable. Cronbach‘s alpha is most widely used method. It may be mentioned that its value varies from 0

to 1 but satisfactory value is required to be more than 0.6 for the scale to be reliable (Malhotra, 2000; Cronbach, 1951). In this

study, we therefore used Cronbach‘s alpha scale as a measure of reliability.

From the table-1, it is seen that reliability value was estimated to be a=0.867 and 0.878 of urban and rural areas respectively. If we

compare our reliability value with standard value alpha of 0.6 advocated by Cronbach (1951) we find that the scale used by us are

highly reliable for data analysis. Validation procedures involved initial consultation of the questionnaires. The experts also judged

the face and content validity of the questionnaires as adequate. Hence, researchers satisfied content and construct validity.

DATA ANALYSIS

To analyze the data, this study used a descriptive (mean, standard deviation) and difference inferential statistics (t-test, f-test). All

statistical calculations were carried out with the help of statistical package for social science (SPSS).

To test the mentioned hypothesis in the study, independent samples t-test was run with SPSS. Before t-test, Levene‘s test for

equality of variances was carried out to be certain about the homogeneity of variances of the comparing groups. This was deemed

necessary to compare the rural and urban areas‘ consumers as two sectors had unequal sample size. From the Levene‘s test for

equality of variances, it was found that equal variances not assumed should be used here (F=2.770, p<.10). Accordingly,

independent samples test was run. It was evident that the difference between the consumers of rural and urban areas with respect

to online purchasing was statistically significant (t=.545, P<.01). Hence, the null hypothesis that ―There is no difference between

the consumer behavior of rural and urban people while purchasing online‖ was rejected and the alternate hypothesis was accepted

that ―There is a difference between the consumer behavior of rural and urban people while purchasing online‖. It can be

concluded that the overall online purchasing by the consumers from urban areas (Mean = 5.176) in specified sample areas is

significantly better than that of online purchasing of consumer from rural areas (Mean=5.010).

FINDINGS

This paper was an intensive work to understand the mindset of people from urban and rural areas as far as online purchasing is

concerned. The review of literature and interaction with both kinds of consumers during data collection helped us to find out

different dilemmas of the issue. Some of the major findings of the research are as follows:

Through the intensive literature review it was found that there have been so many studies done on the issue and

concluded that trust is one of the major factors to drive urban as well as rural people for online purchasing.

During the data collection and interaction with the people, it was found that in most of the rural areas, due to the lack of

the information people were not so excited and enthusiastic for online purchasing. In fact, in some of the cases where

people were willing and interested in purchasing online but e-commerce companies do not deliver at those places.

Another crucial finding of the research is that though the consumers are getting more information about the online

marketing and somehow they are doing as well. However, they still are scared of doing online purchasing for high value

products.

CONCLUSION

The purpose of this study was to conduct a research to thoroughly understand the online purchasing behavior of the consumers

from urban and rural areas. The research framework was made to understand the existing studies in related areas along with the

current states through primary data. Our findings show that the online purchasing habit of consumers depend upon the need and

trust of consumer on that particular e-commerce retail website. While conducting this study we also came across the fact that the

consumer behavior of rural consumer and urban consumer is different. Their thinking, liking, disliking and purchasing pattern as

far as online purchasing is concerned are different which differentiate their purchasing patter. The direct interaction with both

kinds of consumers helped us to investigate the real dilemma of consumers, which helped us to conclude the difference between

the rural and urban consumers for online purchasing. Moreover, our analysis helped us to identify several fruitful directions for

future research as well.

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Volume 4, Number 1, January – March’ 2015

ISSN (Print):2319-9032, (Online):2319-9040

PEZZOTTAITE JOURNALS SJIF (2012): 3.562, SJIF (2013): 5.074

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Volume 4, Number 1, January – March’ 2015

ISSN (Print):2319-9032, (Online):2319-9040

PEZZOTTAITE JOURNALS SJIF (2012): 3.562, SJIF (2013): 5.074

International Journal of Logistics & Supply Chain Management Perspectives © Pezzottaite Journals. 1492 |P a g e

APPENDIX

Table-1: Reliability Value of the Scale

Scale Cronbach‟s Alpha

Urban Area Consumer Rural Area Consumer

Online Purchasing of Consumer Behavior 0.867 0.878

Sources: Authors Compilation

Table-2: Descriptive Statistics of the Overall Consumer Behavior for Online Purchasing

Type of Consumers N Mean Std. Deviation Std. Error Mean

Online Purchasing of

Consumer Behavior

Urban 69 5.176 .887 .106

Rural 133 5.010 1.026 .092

Sources: Authors Compilation

Table-3: Independent Sample t-test for Overall Consumer Behavior for Online Purchasing

Online

Purchasing

of Consumer

Behavior

Levene‟s Test for

Equality of variances

t-test for

Equality of Means

F Sig. T D.f. Sig (2-tailed)

Equal variances assumed 2.770 0.098 .515 200 .000

Equal variances not assumed .545 160.529 .000

Sources: Authors Compilation

*****