Introduction
The development and growth of the World Wide Web has resulted in the way people live, interact, and shop. The internet has revolutionized the lives of people in nearly all areas of life. The internet has made it possible for learners to study online, researchers and scientists to do their research, while the internet has revolutionized commerce and industry. A new breed of consumer has emerged as a result of the growth of the internet. The modern consumer demands convenience more than ever, which has made many sellers to offer online sales and have a spot in the hearts of the new breed of consumers.
The development and growth of the World Wide Web has resulted in the way people live, interact, and shop. The internet has revolutionized the lives of people in nearly all areas of life. The internet has made it possible for learners to study online, researchers and scientists to do their research, while the internet has revolutionized commerce and industry. A new breed of consumer has emerged as a result of the growth of the internet. The modern consumer demands convenience more than ever, which has made many sellers to offer online sales and have a spot in the hearts of the new breed of consumers.
This paper seeks to analyze the behavior of buyers in online shopping by exploring what customers think before they buy, the barriers and crucial factors to online purchases such online product endorsements on purchase decision process, and influence of social shopping communities, as well as the reasons for incomplete purchases (cart abandonment).
Literature Review
Myoung-lang (2020) observes that online shopping has gained increased significance in the modern digital age. As evolution of information and technology continues to grow, new opportunities for buying are opening up. There is increasing acceptance and embrace of online shopping, as there is opposition and barriers hindering online shopping. Proponents of online shopping consider it practical while its opponents consider it as a luxury. Myoung-lang, (2020) observes that online shopping is more practical than it is a luxury, given that shoppers do not have to be burdened with loads of products from the marketplace. Online shopping in the form of food delivery is a catalyst that eases unilateral burden placed on women of having to prepare mean and produce meals. Myoung-lang (2020) brings a fresh perspective into consumer behavior in online shopping by demystifying the myth that online shopping is no longer a luxury but practical.
Definition of Online Shopping and Its History
Big Commerce (2021) defines online shopping as the online selling and purchasing of goods and services. Ecommerce comprises a wide variety of data, tools and systems and tools for online consumers and vendors including shopping and online payment encryption. Big commerce records that online shopping started about 40 years with the founding of CompuServe, which were the initial methods of email and internet connectivity to the public in 1969.
In the 1979, Michael Aldrich invented electronic shopping by linking an improved TV to a transaction-processing processor. In 1982, Boston computer exchanges launched the first ecommerce company in the world with the primary intent being to serve online individuals interested in selling their secondhand processors (Big commerce, 2021).
Books Stacks Unlimited launched the first virtual book marketplace in 1992. In 1994, Netscape Navigator launched a web browser. That was followed by amazon launch in 1995 as a platform for selling books. The emergence of PayPal as a money transfer tool in 1998 enhanced online shopping experience (Big commerce, 2021). In 1999, Alibaba launched an online marketplace that served B2B, C2C, and B2C platforms. In 2000, Google introduced Google AdWords as a tool for online advertising. Other developments came up with more online retailers coming up such as Shopify, eBay, Etsy, Apple Pay, jet.com and lately shoppable Instagram in 2017 (Big commerce, 2021).
Barriers and Crucial Factors in Online Shopping
According to Zhang, Zhao & Gupta (2018) the modern marketplace has become more competitive and dynamic than ever before. The internet has made life easy in various fronts, including through convenience shopping whereby consumers purchase goods and services at the comfort of their homes. Technologies like amazon drones have made it possible for customers to get goods and services within minutes and hours after placing the order. Doaei & Hassanzadeh, (2013) observe that there are several crucial factors that affect consumers’ decision when buying online. One, best prices online is a crucial actor that influences consumers’ choice of online shopping. Most online sellers position their products at fairly low prices compared to physical stores to attract more customers. Secondly, online shopping allows for convenience and time saving, especially when the goods are delivered to the customer’s doorstep. Availability of product reviews by other customers is also an essential factor that influences people to shop online. Finally, it is possible to carry out price comparison from various vendors before settling on the final seller as opposed to physical stores where one has to move from one shop to another comparing price (Doaei & Hassanzadeh, 2013).
While online shopping has gained prominence, it has not penetrated the market as such because of existence of barriers. Zhang, Zhao & Gupta (2018) note that one of the concerns that keep people away from online shopping is the safety of payment. With the increase in cybercrime, most people find it difficult to provide their personal and financial information for payment processing. Another barrier is low level of trust of online stores. Most people trust physical stores because they can see and touch the product compared to online stores who may parade a product but not have it. Another barrier is the high shipping costs that customers have to pay to have the product delivered. Many customers also abhor online shopping because of strict refund policy and very slow delivery.
Closely related to Doaei & Hassanzadeh study is research by Zhang, Zhao & Gupta (2018) regarding online product recommendations as enablers or inhibitors of decision making. The study identified information overload and deceptiveness as the main inhibitors that negatively influence the quality of decision making. When searching for information online, there are loads of information available and it becomes a daunting task to identify the authentic reviews and recommendations from flawed ones. Some of the enables (critical factors) are self-reference and crucial factors that reflect the quality of online product recommendations. The influence of social media is too strong as some people cannot make decisions on their own that they have to get the opinions of others. When someone seeks for an opinion online, they are likely to get lots of information, leading to information overload that might result in indecision (Zhang, Zhao & Gupta, 2018).
Xun (2016) observes that high customer cumulative ratings may experience higher demands and profits. As such, customer ratings may serve both as barriers or opportunities for sellers. Ratings pertain to various e-service offerings ranging from customized website design, fast shipping, customer support, return policies, purchaser security and credit card payments. The rating might be high or low whereby high ratings serve as an opportunity while low ratings serve as barriers to online shopping. According to Xun, sellers need to be aware of the rapid growth of online shopping and work towards addressing the barriers and turn them into opportunities (Xun, 2016).
What Consumers Think before They Buy and Online Buying Trends
Rajani & Nakhat, (2019) conducted a study of purchase patterns among the youths of ages 18-25 and to get their perspectives on what they think before they buy. The study showed that participants look or a particular brand before they purchase. A supplier who is not the brand is perceived to be counterfeit or to be selling faulty products. Consumers also think about the price of the branded item whereby cheaper prices online make it feasible for more customers to buy. Customers also think about product reviews from previous customers whereby good reviews imply that the product would be of superior quality. On the other hand, bad reviews are considered to be more realistic as 90% of the subjects would not purchase a product with a bad review.
Although Singh & Singh, (2014) is an independent study on online behavior trends, it serves as the summation of the previous three articles. The study shows that online shopping is largely influenced by social circles and family networks. This observation reinforces the study by Zhang, Zhao & Gupta (2018) on the impacts of social shopping communities in influencing online purchasing. Singh & Singh further note that convenience and time savings are the main critical factors (enablers) of online shopping. Customers carry out price comparison in online and offline stores to evaluate prices, offers and product quality. The study also reveals that there is a huge potential for online shopping, but people are apprehensive because of safety issues. The increase in cybercrime and internet hacking has made people afraid of giving their card details for payment processing. Therefore, online sellers should be aware of the enablers and inhibitors of online shopping to take maximum advantage of the potential of online purchases.
Abandonment in the Online Shopping Process
Customer purchase process may be complete or incomplete. An incomplete process is where the customer abandons the purchase process in the middle. In most online purchases, payments are done after delivery. In instances where payments are made before delivery, sellers allow buyers to return the product. Xu & Huang (2015) observe that cart abandonment may be positive or negative. Positive abandonment is influenced by the organization and comparison with external environment. Xu & Huang further observe that negative abandonment is caused by perceived cost and perceived risk.
The Future of Online Shopping
Alfonso, Boar, Frost, Gambacorta & Liu (2020) note that brick and mortar shipping has been below par for some time, but the covid-19 pandemic has led to the increase in online shopping. The authors note that approximately 47% of individuals globally shop online today. China is the biggest marketplace followed by the United States in the second place; japan is the third while the United Kingdom and Germany come in fourth and fifth place respectively. The endemic has quickened the change from traditional brick and mortar to digital shopping as restrictions on movement to combat the spread of the disease led to the increase in online demand for various products and services.
Liu et al (2020) observe that the future of online shopping is promising as ecommerce platforms are adjusting their goods and services offerings. For illustration, certain online retailers such as amazon have utilized computerized technologies such as drones and robots for last-mile delivery. Some of the services that were technology resistant such as health services are using new channels such as live streaming on social media and telemedicine in their overall offerings.
The shutting down of many brick and mortar stores forced consumers to question their deep-seated shopping behaviors. A study conducted by Liu et al (2020) records that there is a rising share of adult shopping online more frequently after the pandemic. In emerging market economies, the number of online shoppers has gone up and customers expect at-home delivery and buy online and pick up in-store to escalate.
These findings were replicated in an IBM survey of 3540 business leaders in 20 countries who expressed optimism that the future of online shopping is bright. The survey participants reported that they expect e-commerce to continue thriving, particularly because young users spend more time shopping online than before the pandemic. As the millennials age, these practices may have a structurally imperative impact on collective retail behavior in coming years. A study on millennials lifestyle by Noreen (2015) found that there is a dramatic shift in the travel habits of young American adults compared to the conduct of millennials. The results show that the there is a 10% to 25% of the reduction in movement is attributable to millennial particular actors such as virtual mobility. Virtual mobility is such as online shopping and social media whereby the millennial does not have to go anywhere to travel as this arching reality has been brought about by changes in technology. Noreen sees the “Go-Nowhere” as pertinent in promoting online shopping in the coming years.
Conclusion
Consumer behavior in online shopping is the interplay of many actors. There are factors that serve as drivers of online shopping while others hinder customers from purchasing online. Some of the critical factors that make customers purchase online are such as the availability of a product online, cheaper prices online, credibility of the seller (brand), convenience and time saving, availability of product reviews. Barriers that serve as hindrances to online shopping are such as lack of trust and concerns about safety. Most people find it difficult to provide their personal and financial information for payment processing. Customers think about product reviews before buying a product. Although positive customers’ reviews increase play a significant part in influencing purchases, negative reviews are considered more genuine. 90% of customers would drop the idea of purchasing a product altogether if they found a negative review. Sometimes, the purchase process may not halt in the middle as customers abandon the sale cart altogether. Customers may abandon the purchase for positive reasons such as doing comparison with external websites. Negative influences that may lead to cart abandonment are such as perceived cost and perceived risk. The future of online shopping is bright, given that the young generations spend most of their time online and travel virtually and shop virtually. As they age, these behaviors are likely to bring a structural impact on retail behavior in the coming years.
Literature Review
Myoung-lang (2020) observes that online shopping has gained increased significance in the modern digital age. As evolution of information and technology continues to grow, new opportunities for buying are opening up. There is increasing acceptance and embrace of online shopping, as there is opposition and barriers hindering online shopping. Proponents of online shopping consider it practical while its opponents consider it as a luxury. Myoung-lang, (2020) observes that online shopping is more practical than it is a luxury, given that shoppers do not have to be burdened with loads of products from the marketplace. Online shopping in the form of food delivery is a catalyst that eases unilateral burden placed on women of having to prepare mean and produce meals. Myoung-lang (2020) brings a fresh perspective into consumer behavior in online shopping by demystifying the myth that online shopping is no longer a luxury but practical.
Definition of Online Shopping and Its History
Big Commerce (2021) defines online shopping as the online selling and purchasing of goods and services. Ecommerce comprises a wide variety of data, tools and systems and tools for online consumers and vendors including shopping and online payment encryption. Big commerce records that online shopping started about 40 years with the founding of CompuServe, which were the initial methods of email and internet connectivity to the public in 1969.
In the 1979, Michael Aldrich invented electronic shopping by linking an improved TV to a transaction-processing processor. In 1982, Boston computer exchanges launched the first ecommerce company in the world with the primary intent being to serve online individuals interested in selling their secondhand processors (Big commerce, 2021).
Books Stacks Unlimited launched the first virtual book marketplace in 1992. In 1994, Netscape Navigator launched a web browser. That was followed by amazon launch in 1995 as a platform for selling books. The emergence of PayPal as a money transfer tool in 1998 enhanced online shopping experience (Big commerce, 2021). In 1999, Alibaba launched an online marketplace that served B2B, C2C, and B2C platforms. In 2000, Google introduced Google AdWords as a tool for online advertising. Other developments came up with more online retailers coming up such as Shopify, eBay, Etsy, Apple Pay, jet.com and lately shoppable Instagram in 2017 (Big commerce, 2021).
Barriers and Crucial Factors in Online Shopping
According to Zhang, Zhao & Gupta (2018) the modern marketplace has become more competitive and dynamic than ever before. The internet has made life easy in various fronts, including through convenience shopping whereby consumers purchase goods and services at the comfort of their homes. Technologies like amazon drones have made it possible for customers to get goods and services within minutes and hours after placing the order. Doaei & Hassanzadeh, (2013) observe that there are several crucial factors that affect consumers’ decision when buying online. One, best prices online is a crucial actor that influences consumers’ choice of online shopping. Most online sellers position their products at fairly low prices compared to physical stores to attract more customers. Secondly, online shopping allows for convenience and time saving, especially when the goods are delivered to the customer’s doorstep. Availability of product reviews by other customers is also an essential factor that influences people to shop online. Finally, it is possible to carry out price comparison from various vendors before settling on the final seller as opposed to physical stores where one has to move from one shop to another comparing price (Doaei & Hassanzadeh, 2013).
While online shopping has gained prominence, it has not penetrated the market as such because of existence of barriers. Zhang, Zhao & Gupta (2018) note that one of the concerns that keep people away from online shopping is the safety of payment. With the increase in cybercrime, most people find it difficult to provide their personal and financial information for payment processing. Another barrier is low level of trust of online stores. Most people trust physical stores because they can see and touch the product compared to online stores who may parade a product but not have it. Another barrier is the high shipping costs that customers have to pay to have the product delivered. Many customers also abhor online shopping because of strict refund policy and very slow delivery.
Closely related to Doaei & Hassanzadeh study is research by Zhang, Zhao & Gupta (2018) regarding online product recommendations as enablers or inhibitors of decision making. The study identified information overload and deceptiveness as the main inhibitors that negatively influence the quality of decision making. When searching for information online, there are loads of information available and it becomes a daunting task to identify the authentic reviews and recommendations from flawed ones. Some of the enables (critical factors) are self-reference and crucial factors that reflect the quality of online product recommendations. The influence of social media is too strong as some people cannot make decisions on their own that they have to get the opinions of others. When someone seeks for an opinion online, they are likely to get lots of information, leading to information overload that might result in indecision (Zhang, Zhao & Gupta, 2018).
Xun (2016) observes that high customer cumulative ratings may experience higher demands and profits. As such, customer ratings may serve both as barriers or opportunities for sellers. Ratings pertain to various e-service offerings ranging from customized website design, fast shipping, customer support, return policies, purchaser security and credit card payments. The rating might be high or low whereby high ratings serve as an opportunity while low ratings serve as barriers to online shopping. According to Xun, sellers need to be aware of the rapid growth of online shopping and work towards addressing the barriers and turn them into opportunities (Xun, 2016).
What Consumers Think before They Buy and Online Buying Trends
Rajani & Nakhat, (2019) conducted a study of purchase patterns among the youths of ages 18-25 and to get their perspectives on what they think before they buy. The study showed that participants look or a particular brand before they purchase. A supplier who is not the brand is perceived to be counterfeit or to be selling faulty products. Consumers also think about the price of the branded item whereby cheaper prices online make it feasible for more customers to buy. Customers also think about product reviews from previous customers whereby good reviews imply that the product would be of superior quality. On the other hand, bad reviews are considered to be more realistic as 90% of the subjects would not purchase a product with a bad review.
Although Singh & Singh, (2014) is an independent study on online behavior trends, it serves as the summation of the previous three articles. The study shows that online shopping is largely influenced by social circles and family networks. This observation reinforces the study by Zhang, Zhao & Gupta (2018) on the impacts of social shopping communities in influencing online purchasing. Singh & Singh further note that convenience and time savings are the main critical factors (enablers) of online shopping. Customers carry out price comparison in online and offline stores to evaluate prices, offers and product quality. The study also reveals that there is a huge potential for online shopping, but people are apprehensive because of safety issues. The increase in cybercrime and internet hacking has made people afraid of giving their card details for payment processing. Therefore, online sellers should be aware of the enablers and inhibitors of online shopping to take maximum advantage of the potential of online purchases.
Abandonment in the Online Shopping Process
Customer purchase process may be complete or incomplete. An incomplete process is where the customer abandons the purchase process in the middle. In most online purchases, payments are done after delivery. In instances where payments are made before delivery, sellers allow buyers to return the product. Xu & Huang (2015) observe that cart abandonment may be positive or negative. Positive abandonment is influenced by the organization and comparison with external environment. Xu & Huang further observe that negative abandonment is caused by perceived cost and perceived risk.
The Future of Online Shopping
Alfonso, Boar, Frost, Gambacorta & Liu (2020) note that brick and mortar shipping has been below par for some time, but the covid-19 pandemic has led to the increase in online shopping. The authors note that approximately 47% of individuals globally shop online today. China is the biggest marketplace followed by the United States in the second place; japan is the third while the United Kingdom and Germany come in fourth and fifth place respectively. The endemic has quickened the change from traditional brick and mortar to digital shopping as restrictions on movement to combat the spread of the disease led to the increase in online demand for various products and services.
Liu et al (2020) observe that the future of online shopping is promising as ecommerce platforms are adjusting their goods and services offerings. For illustration, certain online retailers such as amazon have utilized computerized technologies such as drones and robots for last-mile delivery. Some of the services that were technology resistant such as health services are using new channels such as live streaming on social media and telemedicine in their overall offerings.
The shutting down of many brick and mortar stores forced consumers to question their deep-seated shopping behaviors. A study conducted by Liu et al (2020) records that there is a rising share of adult shopping online more frequently after the pandemic. In emerging market economies, the number of online shoppers has gone up and customers expect at-home delivery and buy online and pick up in-store to escalate.
These findings were replicated in an IBM survey of 3540 business leaders in 20 countries who expressed optimism that the future of online shopping is bright. The survey participants reported that they expect e-commerce to continue thriving, particularly because young users spend more time shopping online than before the pandemic. As the millennials age, these practices may have a structurally imperative impact on collective retail behavior in coming years. A study on millennials lifestyle by Noreen (2015) found that there is a dramatic shift in the travel habits of young American adults compared to the conduct of millennials. The results show that the there is a 10% to 25% of the reduction in movement is attributable to millennial particular actors such as virtual mobility. Virtual mobility is such as online shopping and social media whereby the millennial does not have to go anywhere to travel as this arching reality has been brought about by changes in technology. Noreen sees the “Go-Nowhere” as pertinent in promoting online shopping in the coming years.
Conclusion
Consumer behavior in online shopping is the interplay of many actors. There are factors that serve as drivers of online shopping while others hinder customers from purchasing online. Some of the critical factors that make customers purchase online are such as the availability of a product online, cheaper prices online, credibility of the seller (brand), convenience and time saving, availability of product reviews. Barriers that serve as hindrances to online shopping are such as lack of trust and concerns about safety. Most people find it difficult to provide their personal and financial information for payment processing. Customers think about product reviews before buying a product. Although positive customers’ reviews increase play a significant part in influencing purchases, negative reviews are considered more genuine. 90% of customers would drop the idea of purchasing a product altogether if they found a negative review. Sometimes, the purchase process may not halt in the middle as customers abandon the sale cart altogether. Customers may abandon the purchase for positive reasons such as doing comparison with external websites. Negative influences that may lead to cart abandonment are such as perceived cost and perceived risk. The future of online shopping is bright, given that the young generations spend most of their time online and travel virtually and shop virtually. As they age, these behaviors are likely to bring a structural impact on retail behavior in the coming years.
