IMPACT OF ONLINE SHOPPING ON RETAIL SECTOR

Introduction
The introduction and implementation of internet technologies has created new market for
manufacturers and service providers and also has provided new arena for innovative marketing
strategies by the professionals. There are various reasons of shifting the customers buying
patterns towards online retail shops. The facility of comparing your product with competitive
products on the basis of price, colour, size and quality is one of the biggest benefits of online
shopping. Moreover the product remains at its place even you purchase it. It looks hilarious but
this is also one of the most significant reasons reported by the online shoppers. The other popular
names for online shopping are virtual store, e-shop, web-shop, internet shop, web-store and
online storefront etc. These days Mobile commerce or m-commerce is also one of the popular
means of shopping. The facilities of various coupon and discount scheme are also fascinating the
customers in online shopping. In our time, internet is acknowledged as noteworthy valuable
communication channel taxing with the traditional ones, such as walkie-talkie, magazines, and
small screen. From the past few years, on-line shopping is the prevalent way of doing dealings in
the field of E-Business and is unquestionably going to be the future of shopping in the human
race. The increasing consumer base, principally of youths, is playing a significant role in the
online shopping. Through this means, the shopper can buy the product from wherever he wants.
Because of wide communication network e-commerce has become the new mediator between the
companies/manufacturers and their customers. The growth rate of Indias e-commerce industry is
fascinating. It was reported as 88% in 2013 which is a clear contrast picture of the slower
economic growth of India. The rising inflation rate in recent years has not slipped away the
performance of online shopping industry in India. If one tries to identify the cause of this growth
rate then it will not take many efforts to find the answer. The more innovative ways of online
payment and increasing internet penetration has given a paradigm shift and push to this industry.
The increase of internet technology in India has colossal potential. It will trim down the cost of
product and service delivery and lengthen geographical boundaries in bringing buyers and sellers
together. The boost in use of internet by the customers in younger age bracket in India has
provided a promising outlook for online retailers. The majority of the companies are operating
their on-line portals to put up for sale (of both products & services), to shrink marketing costs,
and subsequently plummeting the prices of their products and services to continue their position
in the future market. Earlier the Indian customers were more attracted towards electronic gadgets
and mobile phones for online shopping but now the products indicative of lifestyle, viz., watches,
apparels, perfumes, beauty products are also in high demand through the medium of online
shopping. The market is also developing for books, jewellery, home appliances and kitchen
appliances etc.
Consumer Behaviour can be defined as the decision making process and physical activity
involved in acquiring, evaluating, using and disposing of goods and services The consumer
behaviour is all the activities which include directly involving, acquiring, consuming and
disposing products or services and the procedures to incur decision making before and after these
activities. While understanding the system of virtual shopping, Behavioural nature of the
consumers is a priority issue for practitioners who compete with the fast growing virtual market
place. In several countries More than 20 per cent of Internet users already buy products and
services online
In the last few decades, the internet has been a powerful tool. The advent of internet has removed
major industry barriers and made shopping much more easily. The development of internet from
last 5 years has significantly increased the web-users which are due high speed data transmission
and other technology developments have created an advantage for the firms to promote
themselves more significantly. In the current era of internet customers use internet for varied
purpose and activities; searching information about products/ services, companies, product
features and prices, availability of the product , selection of products, placing order and paying
them online ensuring a smooth transmission of the complete process. Online shopping has
become the third popular internet activity which further followed up by e-mails and web
browsing. Many researches have indicated that the internet shopping particularly in B2C has risen
and online shopping become more popular too many people. In some companies the weight of e-
commerce sales is high (Dell computer reached $ 18million sales through internet). This advent
of internet has made the marketers to realise that the consumer behaviour transformation is
unavoidable and thus they have to change their marketing strategy. Development in the recent
technology is transforming e-business in to a mainstream business activity while at the same time
the behavioural nature of the online customers are getting matured which makes the virtual
vendors realize the importance and urgent need of a professional and customer oriented approach
which have more chances on influencing with the marketing strategies.
 Data Collection Method

When it comes to data collection there are two methods in general used by researchers to collect
data, primary and secondary method. If talking about primary data it includes observation
method, Interview/ questionnaire method, case study method, projective techniques. Secondary
data is one which is already collected by some other researcher not for the reason for particular
study or research.
The researcher would like to go for primary data collection method that will include questionnaire
from consumers as what are the factors that influence consumers to purchase online. As the study
covers lovely professional university students so it would be easy to distribute the questionnaire
and then analyse the situation. As respondents are from different region so that use of
questionnaire may be the only choice of data collection as if respondents are geographically
scattered
A good questionnaire design is a key to obtain good survey result .There are several advantages of
questionnaires for the research survey.
A. Questionnaires are relatively effective and inexpensive comparing to other data collecting tool.
B. Questionnaires are powerful in presenting the characteristics of a large group of population.
C. Many standardized questions are used to increase the reliability of primary data.

This research used self-constructed questionnaires as an instrument to gather the data, the
researcher constructed questionnaire based on the general accepted theory and knowledge. As the
survey was self-constructed, it must be tested for validity and reliability test to prove the
questions are valid and reliable.
The research methodology comprises of the sources of data, methods adopted to collect such data,
sampling techniques, statistical tools for analysis, data interpretation etc. Sources Of Data- The
data for the study have been collected from primary sources. Primary data have been collected
through- questionnaire where there is more then 18 question is there, with the detail like income
group, age group, educational qualification. (Format of questionnaire is given below)
 RETAIL PRESENT SCENARIO IN INDIA

Currently the retail industry in India is accelerating. It is not widely accepted as the way it is
accepted in Asian counterparts. India is excited to grow to be a most important player in the retail
market. Since India is a developing nation, it is still not prepared for it. And they are leaving no
stone unturned to become the best in retail Industry. Also India with a high on cross culture
factor ,it allows different companies bringing in variety of products Targeting different consumer
segments.
According to the Global Retail Development Index 2012, India ranks fifth among the top 30
emerging markets for retail. There are many factors contributing to the boom in this sector. Some
of them are increased consumerism with t he ability to afford luxury items. Even there is increase
in the spending power of Indians. Indians are travelling abroad and they are exposed to different
cultures, their way of living, their style and thereby more brands. Worldwide retailers eye the
Indian market because in our culture there is lots of give And take for marriages, festivals and
other important events. Hence its imperative for people to spend on gifts as a part and parcel of
life irrespective of caste and creed and economic status. As there is no limitation to the spending
power, Cities like Chandigarh,
Pune, Kolkata, Ahmadabad, Nagpur, Cochin, Hyderabad etc has fine market for about all product
or service which offers a good proposal for a brand to penetrate Indian market

ONLINE RETAIL
The fact that world is fast dwindling into a universal community for the reason that of Internet
and other communication mediums is not completely reflective in the Indian context. While
developed and fast developing countries have understood the influence of Internet, India is still
ignorant and trying to deal with up with the technological developments. The retail industry
campaign has been repainted by Internet and the rules of the game in retailing are fast altering.
The western culture has affected each and every aspect of our Indian Society. The life is
becoming fast not only in metros but also in the normal cities. The number of nuclear families is
increasing and both husband and wife are working, as they have less time to go to the market for
purchasing every now and then.
Some other reasons like these, say shortage of time, traffic jams, late working hours, versatility of
plastic money and above all the approach of internet at the door step of whosoever desires it.
Online retailers have improved their service and consumers have found it convenient. There is
been transformation in payment mode as well. From advance payment it is moved to cash on
delivery (COD). Even in case of delivery pattern is changed. From fixed delivery timings it is
moved on to convenient delivery timings at the choice of the customer. India has opened the
doors for foreign direct investment in retail.
Indian market is dominated by unorganized players but there is potential in the area of retail
players as well. Entry of bigger players such as Big Bazaar, More etc to even in the rural areas is
paved the way of growth in its sector. There is been rise in the increase of Indian middle class
people due to rapid economic growth. Though the population of using Internet in India is low in
terms of by and large percentage of total population but, in total numbers it is very high. This
gives enormous opportunities for various ecommerce sites to get in touch with this segment. The
population accessing in India is the age group from 1845. Irrespective of this fact online retailing
forms a meager 0.08% of the entire Indian retail markets. Market players have to be more
positive, revolutioniring and pioneering in their approach and offering to make serious inroads. In
the current market, bulk of online sales is in a range of items. This market in India needs to leap
to the next level.

IMPLICATION OF ONLINE SHOPPING ON RETAIL SHOP

The implications of losing independent retail stores may well have economic impacts
further down the supply chain. When specialty local manufacturers sell their products in
stores and online, online pricing makes the product less attractive in stores, undercutting
brick and mortar stores who have higher tax and labor costs. However, specialty products
are more likely to be purchased in a brick and mortar store, where customers can touch,
try or taste the product. Once they are interested, though, customers may look online and
find lower pricing. However, if retailers stop purchasing from those manufacturers, they
are less likely to be purchased online, without customers first having a chance to come
close to interact with the product. It makes sense that online consumers stick to brands
they already know. To compound the problem, online algorithms steer customers towards
products viewed by others, where most paths lead to bigger, well-known brands. .This has
been a main concern happening in India.

Purchasing products or services over the Internet, online shopping has attained immense
popularity in recent mainly because people find it convenient and easy to shop from the
comfort of their home or office and also eased from the trouble of moving from shop to
shop in search of the good of choice. Online shopping (or e-tail from electronic retail or e-
shopping) is a form of e-commerce which allows consumers to directly buy goods and
services over the internet through a virtual shop.Some of the leading online stores
currently in India are Amazon, Flipkart, Snapdeal, Homeshop18, Myntra etc. Retail is a
process of selling goods and services to customers through multiple channel of
distribution. Retail stores may be small or big but they mostly operate in the same line as
purchasing to sale. Retail form of business is as old as civilization and is the most basic
form of business. This study is very much relevant to present times as this will make
awareness about the impact of estores upon retail stores. The sudden surge in online
 shopping and customers have adjusted to it to a greater extent which it a real cause of
concern for the thousands of retailers who have a small shop offering a small variety of
products which are their source of livelihood.

Who Can Buy - How Soon Do You Need It

Online: Most likely, you'll need a credit card, PayPal account, checking account, or some sort of
online financing option.

You'll have to wait for it to arrive through the mail.

Retail: The easiest place to purchase products if you have the money. All you need is a way to get
there, and means to take your item home.

ADVANTAGE: Retail

Product Selection and Availability

Online: Every make and model is at your fingertips without having to drive miles to find it. Don't
see your television at this store, surf to another. The only drawback is you can't test the product
beforehand unless you find it at a retail store near you, but you can read product reviews, user
opinions, and manufacturer specs with minimal exertion. Most reputable sites make aware the
availability of each item.

Retail: Limited to only products it sells at the local level, but you can test your new television in-
person before buying it. Depending on store size, selection may be limited, but availability is
almost always certain.

ADVANTAGE: Online

Base Price

Online: Generally, online sellers features lower prices because they don't have the overhead of
renting a pad in a strip mall, high electric bills, and a staff of sales people.

There's even Web sites that offer 'percent off' discounts if you enter a code after meeting a
minimum purchase requirement, which could save even more money. Though, pay attention
whether or not your television is brand new or refurbished.

Retail: In order to compete with online purchasing, retail outlets are slashing prices all around.
Paired with a coupon or special 'in store' discount, prices might get as low as some online sellers.
In addition, many retail outlets resell returned items for even lower prices.

ADVANTAGE: Online

Taxes, Shipping, and Delivery

Online: Depending on where you live and what store you buy through, you might not have to pay
a sales tax. Shipping is a different story. Some stores don't charge shipping or you can get
coupons for free shipping while others do charge, which might drive the final cost of the
television up several hundred dollars.

Retail: You will pay your local sales tax at a retail outlet, and there won't be any shipping
charges. However, most stores will charge a fee to deliver your new television (if you choose) or
offer free delivery. If they charge for delivery, try to get the fee waived.

ADVANTAGE: Tie

Customer Service and Warranty - Returns, Exchanges, Repairs

Online: This is a sticky point with online purchasing. While most excel in servicing the customer,
there's also a negative stigma associated with online sellers. Please read user opinions before
buying and make a gut-call. At times, consumers are charged restocking fees, have to pay for
shipping if sending the item to be fixed through warranty, or buy the item with a 'no return' clause
in the sale.

Though, with some warranties, the consumer will get a replacement model temporarily or
permanently depending on the issue. Customer service is sometimes hard to contact, and there's
usually no storefront to voice a grievance in person.

Retail: With a receipt, modern retail outlets are easy to deal with when returning, exchanging,
and using the warranty. Customer service is usually driven to retain your business by any means
necessary, even if it means taking one on the chin every now and then. To be on the safe side, read
their return/exchange policy before buying.

ADVANTAGE: Retail
 Factors Influencing Consumer`s Purchasing Intention
Convenience
Convenience factor refers that it is easy to browse or search the information through online is
easier than the traditional retail shopping. Through online, consumers can easily search product
catalog but if the consumer look generally for the same product or item in a traditional store
manually it is difficult to visit physically and time consuming also. Convenience has always been
a prime factor for consumers to shop online. Darian mention that online shoppers carry multiple
benefits in terms of convenience, such as less time consuming, flexibility, very less physical effort
etc

Website Design/Features
Website design and online shopping activity is one of the vital influencing factors of online
shopping. Website design, website reliability/fulfillment, website customer service and website
security/privacy are the most attractive features which influence the perception of the consumer
of online buying Shergill & Chen

Time Saving
Time savings is one of most influencing factors of online shopping. Browse or search an online
catalogue can save time and patience. People can save time and can reduce effort by shopping
online. According to Rohm and Swaminathans, one possible explanation that online shopping
saves time during the purchasing of goods and it can eliminate the traveling time required to go to
the traditional store

Security
Security is another dominant factor which affects consumers to shop online. However many
internet users avoid online shopping because of credit card fraud, privacy factors, non delivery
risk, post purchase service and so on. But transaction security on the online shopping has received
attention. Safe and secured transaction of money and credit card information increases trust and
decreases transaction risk.

Online Shoppers in terms of Demography

Online shoppers in terms of demography are another important aspect. We would like to study
demography in terms of age, gender, income and education as are there any differences while
consumers shop online, differences within the age groups such as does online shopping attracts
elder people or younger people. Studies have shown that online shoppers mainly consist of people
with Higher education and income and working in middle to senior management or professionals.

DATA ANALYSIS AND INTERPRETATION THE RESULTS

1. GENDER
Gender plays an important role in shopping through online. Male have different preference for
product as compared to female. Out of total number of samples we collected 57% were male and
43% were female.

2. AGE
Different age groups have different preference for shopping. In India young generation is more
regular for online shopping. Like, young age groups have no extra time to do offline shopping
thats why they prefer online shopping. The below data tell us which age group sample we have
taken. There are 45% samples whose age is less than 20, 53% were those whose age is 20-30 and
only 2% were more than 30. The sample was taken in this way because most of the user in India
who is using online shopping is between 16-30 age groups.
 3. Education level
The survey tells us persons who are more educated are more aware of online shopping. More they
aware more they shop online. The survey was of 50 samples, out of which 14% are intermediate,
56% are bachelor and 30% are master degree holder and no PhD degree holder.

4. Monthly incomes
36 % of persons who responded were having income less than 2000, 36% were having 2000-3000, 14%
were having monthly income 5000-10000, 12% were having 10000-40000 and only 2% were having
income more than 40000. Survey is conducted among the local persons no matter they graduated or not.
But, I have to mention that most of the respondents are student. They dont have job opportunity due to
knowledge, work skills and unavailability of job. Though maximum respondents are student, between
them lowest number of people has good job, some students has part time job, some students get money
from parents as they are studying.

5. Convenience
When the question was asked to 50 persons have they felt any problem while conducting online purchase,
57% of them said NO while 43% said YES.

Out of those 43% people the main problem was of Delay in Delivery. 12 persons have faced the problem
of delay in delivery. 10 persons have mentioned that they get the cheap quality product. 2 of them have
got damaged product while only one havent got his product delivered. 6 person were also there who were
having other problems.
 Problems NO. of people
Delay in Delivery 12
Cheap Quality 10
Product Damage 2
Non-Delivery 1
Others 6
6. Impact of Internet

The below data tell us that 10 persons were there who very often use internet for shopping, 21 often use
internet for shopping, 11 were using it sometime while 7 use rarely.
People use internet for shopping to get information. They know what is trending in market. what are the
features that the product is having or a product should have. When the question was asket to persons that
they use internet for shopping or not , 36 have answered that they use internet while 13 dont use internet.

The use of internet by person is also increasing the online shopping. More they use internet more they get
attracted toward the offers which are there by online shopping sites. The online shopping sites mainly
advertise through internet. Question was asked to persons that often they use internet in a day. 14% uses
internet less than 1 hour, 18% were using it for 1-2 hours, 25% were using it for 2-3 hours ,20% were
using for 3-4 hour and 23% were using it more than 4 hours in a day.
The question was asked to respondent to describe their proficiency on the internet. 13% were Novice while
29% were advanced and 58% were intermediate. This show that many of the respondent are using internet
regularly and they are having good knowledge of internet.

IMPACT OF ONLINE SHOPPING ON RETAIL SECTOR

(Questionnaire)
Please read each question carefully and indicate your response by selecting the most appropriate choice.

Gender: Male Female

Age: less than 20 20-30 more than 30

Education level :
Intermediate Bachelors Degree Master Degree PhD Degree

Monthly income:

Less than Rs.2000 2000-5000 5000-10000 10000-40000 More than 40000

Have you ever had online shopping? Yes No

How many times did you have online shopping during last one year ?
_________________________

What type of commodity did you purchase through online shopping ?

________________________ 9. Have you felt any problem while conducting online purchase? Yes

No

10. If yes, what kind of problem?

Delay in delivery Cheap quality of product Product damage Non-delivery

Others , Please specify..

11. How often do you use internet for shopping?

Very Often often sometimes rarely never

12. Do you use internet prior to a purchase for collecting information? Yes No
13. Select an approximate maximum amount you would spend per year on online purchase:

Less than 1000 1000-5000 5000-10000 10000-20000 More than 20000

14. In general, you prefer to do your shopping of following commodities:(select any one)
Items Over the internet Over the phone

a. Groceries

b. Cosmetics

c .Books/CDs
Clothes

d.Furniture

e.Electronic gadgets

d.Computer products toys

e. Cinema ticket

f. Airplane/railway ticket

15. How often do you use internet every day?

Less than one hour 1-2 hours 2-3 hours 3-4 hours More than 4 hours.

16. How would you describe your proficiency on the internet?

Novice Intermediate Advanced

 17. Select an approximate amount you would spend on a single online purchase:

Less than 1000 1000-3000 3000-5000 5000-10000 More than 10000

Review of literature

Sr.no. Authours Name year Research Design/ Sample Size and Conclusion of the
Data Response Rate Research
Collection and
Sample
frame
1. Osman, Yin-Fah and 2010 Convenience 100 undergraduate -Writers have concluded that mostly
Hooi-Choo sampling students were students buy books, cloths, travel
Undergraduates and selected. bookings and computer hardwares.
Online Purchasing - Website quality and purchase
Behavior perception have significant relationship
with online shopping.

2. Sami Alsmadi 2002 Convenience 500 Self- E-commerce is consistently taking up

Consumer Attitudes
Towards Online
Shopping In Jordan:
Opportunities And
Challenges
sampling administered a larger proportion of consumer time
questionnaire and spending. There are several
distributed in Ibrid driving factors for consumers to shop
Jordan. online with price, convenience in
shopping and wide range of available
products being the primary. The
major findings of the study are as
follows:
a. Turnover and profit margin of the
retailers has considerably decreased
in the past few years.
b. Retail stores are now-a-days more
engaged in services related to
customer satisfaction.
c. Although the retailers are not able
to keep a wide variety in their stock,
 they attempt to keep the best of them
so as to affect more sales.

3. Jarvenpaa and Todd, 1997 Descriptive study A total of 232 Big online stores are less effective than
Lohse and Spiller internet users are small stores at converting site traffic into
selected sales because consumers have difficulty
in finding the products they seek. It is
argued that since a primary role of an
online store is to provide price-related
information and product information to
help reduce consumers search cost
4. Elliot and Fowell 2000 Questionnaires Sample drawn from . Consumers are concerned about
and Surveys 120 people disclosing their private and financial
household information. While most online shopping
sites provide personal information
privacy protection policy and guarantee
for transaction security, they do not offer
detailed information on how transaction
and personal data are secured
5. Alba 1997 Case studies Authors read more The online shopping environment
then 50 case enables consumers to reduce their
related to online decision-making efforts by providing vast
environment and selection, information screening,
their effect on reliability, and product comparison.
business . Since the Internet provides screened
environment and comparison information for
alternatives, consumers may reduce the
cost of information search and the effort
in making purchasing decisions.
However, since online shoppers mainly
interact with the Web-based computer
system and cannot physically touch or
feel actual products, they make
decisions mainly with information
provided electronically by the online
store
 Conclusion (Pratik kumar verma)
This research investigates the influence of customers' perceptions of retailers' deceptive practices
on the customers' satisfaction with the product, satisfaction with the retailer, and subsequently
WOM (word of mouth) , with a particular focus the different effects associated with online or in-
store shopping. In the online channel, the moderated mediation revealed that perceived deception
influenced retailer satisfaction through product satisfaction. By comparison, in the traditional
channel, perceived deception impacted WOM, being fully mediated by retailer satisfaction and,
given that the relationship between retailer satisfaction and WOM was weaker in this channel as
compared to the online one, perceived deception had a stronger negative indirect effect on WOM
in this channel. This research provides important theoretical and managerial contributions.

Conclusion (Suman rawat)

The face of retail has changed. The advent of technology in recent period being the primary
reason for it.Today, retailing means going into shopping centres, going online and going mobile.
In all these, small retailers miss out somewhere. But the nearby store is always the most important
concern for all reason and seasons. It needs to revive not just survive. The retail stores needs to
simply uplift its pattern of business and face the competitive world with a more positive outlook.
E-stores and retail stores both have to survive, none at the cost of the other. Its not just about the
livelihood it gives to the thousands of people but also the convenience and the steadfastness of a
fixed retail store.
The sample was taken of 50 students in which most of the respondents were using online
shopping instead of offline shopping. This shows that the coming generation is looking for online
shopping. So we can say that the online shopping is at good conditions.

Conclusion (Ritesh saw)

In our studies we focus on shopping behaviour of online user that are included with what kinds of
products they buy, percentage of product buying, device use for online shopping, geographic area
for shopping etc. Finally, the similarity between our studies and researchers view is on customer
service and their feelings.

The current study is descriptive in nature and it has made an attempt to understand the behaviour
of Indian consumers towards online shopping. Although statistical significance of various
parameters has not been examined but the generalized results obtained through data analysis has
given clear indication of increasing significance of online stores in the life of Indian people. The
e-stores are frequently visited by the shoppers. The ease and convenience provided by these stores
for 24x7 has made very easy shopping for consumers worldwide. The analysis discussed in the
above section has documented that the Indian customers are also getting addicted to the online
shopping and they do like various features of online shopping as by rest of the world. But the
statistics available has shown that Indian market is still not a fully developed market for e-tail
stores. There is huge scope of web-stores in various areas and in almost all the segments. The
young population is the biggest attraction of this industry and they may contribute substantially to
the growth of online shopping in India. The majority of internet users are youngsters, the majority
of goods and services demanded are related to only this segment. Travel planning is one of the
biggest services used by Indian online shoppers.

Conclusion (Sanjeet Atwal)

Online shopping is becoming more popular day by day with the increase in the usage of World
Wide Web known as www. Understanding customers need for online selling has become
challenge for marketers. Especially understanding the consumers purchasing intention about
online shopping; Making improvement in the factors that influence consumers to shop online and
working on factors that affect consumers to shop online will help marketers to gain the
competitive edge over others.
From the results we have concluded that the most influencing and attractive factor among four
factors is website design/features with average score of 4,03 , following convenience that is
second most influencing factor with average score 3,73, time saving with average score 3,19 and
security with average score 3,35 is also important, particularly the security concerns are very
important while shopping online

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