A Comparison of Online Shopping Behavior of American and German Consumers

Diploma Thesis , 2004 , 89 Pages , Grade: 2,7

Business economics - Offline Marketing and Online Marketing

“A profound shift in the economy is underway - the industrial age economy is rapidly giving way to the Internet age economy.“1

Four years after the New Economy crash the Internet Economy is booming and hopes that mobile offers will further increase the speed.2 With the number of online sales for goods and services increasing every day3, online shopping - with sales growth rates outpacing traditional retailing purchases - has become one of the
fastest growing forms of shopping4. The statement above explains the reason why the term Electronic Commerce has kept both business research and business practice as occupied as barely any other term, in the last years.5 Warren D. Raisch writes about this shift in the economy that “the global development and acceptance of the Internet as the new standard for communication and commerce provides us with a powerful new global Internet-based E-Business network (...).“6
Realizing that we live in a global marketplace with international trade7 additionally pushed by the Internet, companies face a stronger competition and the need to create more value for customers than their competitors. In this context, it is important for companies to realize that, through the Internet, there is a power
shift to the customer. Furthermore, as customers will demand and tolerate only delightening buying experiences, it is a necessity to capture and analyze information about buying behavior in the 21st century business.8
When talking about E-Commerce, which is a part of Electronic Business (E-Business), describing the sale of goods and services via the Internet targeting a mass market9, the following two areas have to be differentiated: Business-to-Cus- tomer (B2C) E-Commerce, meaning the settlement of buying contracts between a
commercial seller and an end-consumer via electronic media, and Business-to-Business (B2B) E-Commerce, describing the same action but between two commercial
business partners. 10 11
In this paper, the focus lies on B2C E-Commerce as this is the most interesting area regarding marketing.12 13 Therefore, to better understand the online purchase behavior of private consumers, in the frame of the following analysis the influencing factors of shopping over the Internet are examined. Since determining the factors influencing online shopping behavior also discovers those factors hindering the usage of the Internet as a shopping platform, suggestions to improve and adjust online offers appropriately can be made.14

Table of Contents

List of Figures

List of Tables

List of Abbreviations

1 Introduction
1.1 Overview of Online Shopping Trend
1.1.1 Online Shopping in Germany
1.1.2 Online Shopping in the USA
1.1.3 Online Shopping World-Wide
1.2 Objectives of the Paper

2 Online Buyer Behavior
2.1 E-Commerce Barriers
2.1.1 Consumer Concerns
2.1.2 Delivery Problems
2.1.3 Operating with Technology
2.2 E-Commerce Advantages
2.2.1 Convenience
2.2.2 Price Competitiveness
2.2.3 Wider Choice Range
2.3 Online Buyer Profile

3 A Framework for Factors Influencing Online Purchasing Behavior
3.1 Personality
3.1.1 Internet Usage
3.1.2 Attitude towards Online Shopping
3.1.3 Perceived Convenience
3.1.4 Perceived Risk
3.1.5 Perceived Trust
3.2 Purchase Situation
3.2.1 Online Shopping Experience
3.2.2 Shopping Purpose
3.2.3 Easiness of Order Procedure
3.2.4 Payment Options
3.2.5 Web Site Usability
3.3 Product Qualities
3.3.1 Price Competitiveness
3.3.2 Brand Reputation
3.3.3 Speed of Delivery
3.3.4 Choice Range
3.4 Product Categories
3.4.1 Books
3.4.2 Clothes
3.4.3 Flights
3.5 Nationality

4 Research Methodology and Data Interpretation
4.1 Data Collection
4.2 Sample
4.3 Methodology of Analysis
4.4 Research Results for German Consumers
4.4.1 Influencing Factors of Online Purchasing Behavior
4.4.1.1 Personality
4.4.1.2 Purchase Situation
4.4.1.3 Product Qualities
4.4.2 Comparison of Online and Not-Online Buyers
4.4.2.1 Differences
4.4.2.2 Similarities
4.5 Research Results for American Consumers
4.5.1 Influencing Factors of Online Purchasing Behavior
4.5.1.1 Personality
4.5.1.2 Purchase Situation
4.5.1.3 Product Qualities
4.5.2 Comparison of Online and Not-Online Buyers
4.5.2.1 Differences
4.5.2.2 Similarities
4.6 Comparison of German and American Consumers

5 Implications, Limitations and Outlook
5.1 Management Implications
5.1.1 Differences between Product Categories
5.1.2 Reduction of Uncertainty to improve Online Shopping Acceptance
5.1.2.1 Online Payment Security
5.1.2.2 Brand Reputation
5.1.2.3 Warranty Seals
5.2 Limitations
5.3 Outlook

6 References

Appendices

List of Figures:

Figure 1: B2C E-Commerce Sales in Germany

Figure 2: B2C E-Commerce Sales in the USA

Figure 3: Comparison of E-Commerce´s percentage of total retail sales in Germany and the USA

Figure 4: Categorization of Influencing Factors on Online Purchase Behavior and Procedure of Analysis

Figure 5: Model of Hypothetical Influencing Factors on Online Purchase Behavior

Figure 6: Model of Influences on German Online Purchasing Behavior

Figure 7: Confrontation of Varying Opinions of German Online and Not-Online Shoppers in the Category Books

Figure 8: Confrontation of Varying Opinions of German Online and Not-Online Shoppers in the Category Clothes

Figure 9: Confrontation of Varying Opinions of German Online and Not-Online Shoppers in the Category

Figure 10: Similarities among German Customers

Figure 11: Model of Influences on American Online Purchasing Behavior

Figure 12: Confrontation of Varying Opinions of American Online and Not-Online Shoppers in the Category Books

Figure 13: Confrontation of Varying Opinions of American Online and Not-Online Shoppers in the Category Clothes

Figure 14: Confrontation of Varying Opinions of American Online and Not-Online Shoppers in the Category Flights

Figure 15: Similarities among American Consumers

List of Tables:

Table 1: Demographics on Total Sample and Sub-Groups

Table 2: Influencing Factors on German and American Online Shopping Behavior

Table 3: Summary of Influencing Factors Results and Consumer Groups Comparison

List of Abbreviations:

illustration not visible in this excerpt

1 Introduction

“A profound shift in the economy is underway - the industrial age economy is rapidly giving way to the Internet age economy.“¹

Four years after the New Economy crash the Internet Economy is booming and hopes that mobile offers will further increase the speed.² With the number of online sales for goods and services increasing every day³, online shopping - with sales growth rates outpacing traditional retailing purchases - has become one of the fastest growing forms of shopping⁴. The statement above explains the reason why the term Electronic Commerce (E-Commerce) has kept both business research and business practice as occupied as barely any other term, in the last years.⁵ Warren

D. Raisch writes about this shift in the economy that “the global development and acceptance of the Internet as the new standard for communication and commerce provides us with a powerful new global Internet-based E-Business network (...).“⁶

Realizing that we live in a global marketplace with international trade⁷ ad- ditionally pushed by the Internet, companies face a stronger competition and the need to create more value for customers than their competitors. In this context, it is important for companies to realize that, through the Internet, there is a power shift to the customer. Furthermore, as customers will demand and tolerate only delightening buying experiences, it is a necessity to capture and analyze information about buying behavior in the 21st century business.⁸

When talking about E-Commerce, which is a part of Electronic Business (E-Business), describing the sale of goods and services via the Internet targeting a mass market⁹, the following two areas have to be differentiated: Business-to-Customer (B2C) E-Commerce, meaning the settlement of buying contracts between a commercial seller and an end-consumer via electronic media, and Business-to-Busi- ness (B2B) E-Commerce, describing the same action but between two commercial business partners.¹⁰¹¹

In this paper, the focus lies on B2C E-Commerce as this is the most interesting area regarding marketing.¹²¹³ Therefore, to better understand the online purchase behavior of private consumers, in the frame of the following analysis the influencing factors of shopping over the Internet are examined. Since determining the factors influencing online shopping behavior also discovers those factors hindering the usage of the Internet as a shopping platform, suggestions to improve and adjust online offers appropriately can be made.¹⁴

1.1 Overview of Online Shopping Trends

As the focus of this paper lies in a comparison of German and American online purchasing behavior, the first step is to take a closer look at the German and at the American past online shopping developments and at future predictions. To illustrate general online shopping trends, world-wide B2C E-Commerce is a further component of this overview.

In Germany the Internet is becoming firmly established as a mass medium, similar to the way it is in the USA¹⁵, making it of a high interest to find out if and why differences exist between the consumers´ online shopping behaviors in both of these countries.

1.1.1 Online Shopping in Germany

In November 2003, Germany had 34.4 million Internet users. 20.8 million of those Internet users were also Internet shoppers, which means that more than 60% of Germans surfing the Web were purchasing online in the end of 2003.¹⁶ For 2004, according to Nielsen estimates, Germany has 47.18 million Internet users.¹⁷ In the first quarter of 2004, 50% of these Internet users were also using the World Wide Web to make online purchases.¹⁸

According to eMarketer, total B2C E-Commerce sales in Germany increase from 2.3 billion USD in 2000 to 57.7 billion USD in 2004.¹⁹

illustration not visible in this excerpt

Figure 1: B2C E-Commerce Sales in Germany²⁰²¹

As figure 1 above shows, B2C E-Commerce sales in Germany more than double each year. This positive development is further expected in the following years. Forrester Research forecasts that by the end of the decade Germany will be at the top of E-Commerce in Europe,²² while currently, Germany, with 55% of house-holds with Internet access making online transactions, stands behind the British, where already 62% shop online.²³

1.1.2 Online Shopping in the USA

In the USA the success of electronic shopping is definite. The latest since Christmas 1998 electronic trade is established as a mass business.²⁴ Therefore, the USA was already leading in the early stages of private online transactions, while Europe was trying to catch up.

In 2002, the USA had 165.75 million Internet users, a percentage of 57.5% of the total population, and reserved the first place in the CIA World Factbook of Internet users.²⁵ The actual estimate, by Computer Industry Almanac Inc., shows 185.90 million Internet users in America, making the United States still reserving the first place in this category. 30% of these Internet users in America are already spending money for purchasing over the Web. For the year 2008 Jupiter Research expects this number to be 50%. Figure 2 shows that since 2000, B2C E-Commerce sales have increased by 260% till today.

illustration not visible in this excerpt

Figure 2: B2C E-Commerce Sales in the USA²⁶

According to Forrester Research, American customers have spent nearly 100 billion dollars for shopping over the Web during the last year. In five years, an amount of 230 billion dollars is expected, which means that every tenth dollar the Americans spend for retail would go to online retailers.²⁷

The comparison of American and German E-Commerce´s percentage of total retail sales shows that by now Germany has passed America.

illustration not visible in this excerpt

Figure 3: Comparison of E-Commerce´s percentage of total retail sales in Germany and the USA²⁸

Based on projections made by Jupiter Research, as well as by Forrester Research, the share of total consumer sales accounted for by E-Commerce will increase to nearly 4% in the USA by 2008.²⁹ In comparison to this, the same ratio for Germany is expected to be already 11% by 2007,³⁰ expressing a faster consumer acceptance of online transactions in Germany.

1.1.3 Online Shopping World-Wide

In the year 2000, 120 million people of the world-wide population already make online purchases, 54% of these transactions are made in the USA.³¹ For 2004, it is expected that the American contribution to world-wide B2C E-Commerce sales is still 46.2% (Germany has a share of 13.5%), proving that the USA population is still leading concerning the dollar amount spent for online purchases.

In 2002, the number of online users who are also shopping online stagnated at a level of 15%³², but the amount of money spent online is continuing to grow, reaching 428.1 billion USD this year.³³

In their paper “Internet Car Retailing“, Fiona Scott Morton, Florian Zettelmeyer and Jorge Silva-Risso claim that “the Internet is expanding rapidly into every market and many geographic locations“³⁴. Thus, it seems obvious that even though the amount of products bought via the Internet is nowadays only a few percent of all retail sales, Electronic Business has an annual growth rate of 70 to 80%, and predictions correspond on an immense market growth in the fol- lowing years.³⁵

1.2 Objectives of the Paper

Considering the above mentioned E-Commerce statistics, it is clear why the com- prehension of consumers´ online purchasing behavior is getting more and more in- teresting and managerially meaningful. Obviously, there are factors, which make online purchases attractive to customers³⁶, but what are these factors? And how do online shoppers differ from not-online shoppers? Therefore, the main ques- tions this paper addresses are: What influencing factors explain the consumers´ decision to buy or not to buy online? Are there differences between American and German consumers?³⁷

First in this work, literature is reviewed to describe affects on Internet shopping behavior through E-Commerce barriers and advantages, as well as through influencing factors extracted from former research. In chapter 3, the framework for the analysis of factors influencing online purchasing behavior is introduced. Afterwards, a model describing hypothetical influencing factors on online shopping behavior is developed. Those factors are divided into 3 main categories: personality, purchase situation and product related qualities. Since an additional objective of this paper is to examine possible differences among the influencing factors on online buying behavior in different product categories, and since it is not possible to have a look at all the different kinds of products offered online, a further task is to choose which the considered ones are.

The model of hypotheses is tested using the binary logistic regression analysis and to find potential differences between American and German consumers the country-based results are compared. The necessary data is generated by an online questionnaire filled out by at least 50 American and 50 German consumers. Having validated or rejected all set up hypotheses, the results, which the binary logistic regressions are generating, as well as the findings made by the comparison of both countries´ influencing factors, will be summarized and discussed. For the last analysis, to be able to find significant differences between online shoppers in Germany and those in the USA as well as between not-online shoppers from both countries, the independent samples t-test is carried out.

Finally, this study provides management implications to turn Internet u- sers into customers and is rounded off by giving an outlook on possible future research with the goal to get a more detailed view on the important influencing factors on buying behavior in the new business arena Internet.

2 Online Buyer Behavior

Online buying behavior is a complex construct and not easy to understand or to predict. Only a few years ago, it seemed obvious that customers like to get information online, but prefer to make the actual purchase offline. Even if they bought something over the Internet, if the bought product was defective, they preferred to hand it over to a physical expert to get it repaired.³⁸ In contrast to it, nowadays more and more people are using the Internet as a new purchasing channel. An analyst at Forrester Research explains this development by stating that online shopping is a self-feeding machine: the more people buy over the Internet, the more sellers go online and pull new customers in.³⁹

For a better understanding of why and when the Internet as a new buying channel is used these days and how customers decide whether or not to buy on- line, the reasons described in the literature for and against online shopping are ex- amined. To complement the findings, an Internet shopper´s profile is used as a second approach.

2.1 E-Commerce Barriers

There are a number of factors contributing to the consumer´s decision not to do online shopping, from now on called E-Commerce barriers. First, to get a general i- dea why some consumers boycott Electronic Commerce, the main reasons not to buy on the Internet are given.

2.1.1 Consumer Concerns

The fast growing development of Electronic Business makes the security of elec- tronic transactions more and more important.⁴⁰ However, as the results of a survey conducted in 2000 on behalf of the European commission showed, 68% of the German population does not buy online because they do not trust the payment process,⁴¹ which hinders especially the payment by credit card. Also in America, the transmission of a credit card number is still seen by 63% of the consumers as a problem in 2003.⁴²

Therefore, it is important to calm the consumers and to let them know, that soon a lot more can be done to protect them. The latter is also Jung´s conviction as he says that “the development of secure Electronic Business has al- ready made quite a lot of progress, but is still in its infancy regarding the nu- merous opportunities it offers in the future.“⁴³ This gives hope for a wider accept- ance of online shopping caused by increased trust in later times, but what can be done today?

It is more than understandable that secure payment stands in the fore- ground when doing Internet shopping⁴⁴, considering the fact that even if the non- encoded transmission of credit card information seems at first sight as safe as the use of this card in a restaurant, main differences exist: A big amount of automat- ically generated credit card information together with user profiles and the possi- bility to analyze this data mechanically, increases the danger to wake significant criminal energy and inventive behavior.⁴⁵ As many consumers fear credit card fraud, it might be supportive for online retailers to offer different payment op- tions, so that the buyer can choose the one he or she feels the most comfortable with.

However, there are not only security concerns, but also general concerns. Those can rise from the consumers´ low trust in E-Commerce, caused by the fact that as the seller´s investments are lesser than in traditional commerce, there are fewer assurances for consumers that the retailer will stay in business for some time.⁴⁶ This implicates that the already paid money might be gone without the pur- chased product being received or that a retailer might not be a real retailer, but a swindler. This individual level of confidence in electronic shops is called consum- er´s perceived trust.

2.1.2 Delivery Problems

Home delivery strategies have to meet customer expectations,⁴⁷ which according to CyberAtlas.com is very often not the case as online consumers placing their orders online complain that purchases in the worst case get lost, broken or are never shipped.⁴⁸ An additional problem concerning delivery especially arises if the products are available in stores at a comparable price.⁴⁹ As a rule, consumers are not willing to wait for the online made order for a long time, which makes speed of delivery an important topic in Electronic Commerce.

The customer´s fear of a lost, broken or never shipped product when conducting online business is a perceived risk connected to online shopping, and is examined on its importance on online shopping behavior as well.

2.1.3 Operating with Technology

The participation in E-Commerce is dependent on requirements, which the consu- mer has to meet. Apart from technological requirements like hard-, and software components and Internet access, the dealing with this technology has to be men- tioned. The usage of this technology is still much too complicated, which deters many interested and consequently potential E-Commerce users.⁵⁰ This especially refers to consumers who are inexperienced in Internet usage and/or Internet shop- ping.

Because in the frame of this paper an online questionnaire is posted on the Internet, all respondents possess or have access to the technology needed to order products over the Web, which leads to the usability remaining for discussion. Therefore, the absence of an easy order procedure and a user-friendly Web site seem appropriate to describe possible disadvantages of E-Commerce.

2.2 E-Commerce Advantages

When buying over the Internet the consumer has to receive an added value, which is not received when buying via other ways of sales.⁵¹ There are several advantages when purchasing over the Internet, which explains the reasons why people shop online. Those strengths of E-Commerce that allow online shopping to offer lots of benefits, which will not be found when shopping in a store or by mail, are dependent on the strengths of the Internet.

2.2.1 Convenience

One of the first things to mention when talking about the reasons to buy online, is that the Internet is available 24 hours a day, 7 days a week.⁵² Consumers do not need to consider business hours and can still easily order what they need, even if they come home from work late, when traditional shops are already closed. Under the prediction of an Internet connection, anyone from anywhere at any time is able to conduct electronic transactions.⁵³

The new retail channel has even more to offer in terms of convenience. An often mentioned reason for buying online is the lack of time. The Internet of-ers those consumers who think they don‘t have enough time to shop in traditional stores a real value.⁵⁴ This convenience advantage of E-Commerce, the reduced time consumption is additionally supported by the comfortable home delivery. To summarize, two different time problems are solved in the electronic shopping world. On the one hand those people, who have a restricted time zone to go to an open store and on the other hand those people, who are very busy and in general lack time, find it highly convenient to be able to order online without being de- pendent on time.

Under the topic convenience, a further advantage of electronic trade, which is its reduced search costs, has to be added. On the Internet it is possible to get actual information in a very fast and cheap way.⁵⁵ Using information technology the time spent searching for a product decreases as buyers can search the inventories of thousands of stores in just seconds, whereas it requires much more time locating the desired product by searching through catalogues, visiting brickand-mortar stores or calling up sellers.⁵⁶

2.2.2 Price Competitiveness

Another advantage of E-Commerce is that because of the much higher market transparency, a price comparison is much easier than in traditional shops. The so called Intelligent Agents can check prices and delivery times of different online stores and find the best alternative.⁵⁷ As companies are aware of the stronger com- petition when participating in online retailing, the same offerings of a retailer are sometimes cheaper online than they are offline⁵⁸⁵⁹, and consumers can make numerous bargains.⁶⁰ For this reason, particularly price-sensitive consumers might be more willing to use the computer to place an order.

2.2.3 Wider Choice Range

For online shoppers a wide selection of products is much easier to access than for traditional shoppers, as they are not limited by bearing the pecuniary and time costs of travel.⁶¹ The boundaries of the real world do not exist any longer, and con- sumers are able to order products offered by retailers they normally could not reach without huge expenditures, e.g. from overseas, while sitting at home. A wider accessible product choice range, which is also pushed by the unlimited space on the Web, supports the consumer´s search to find exactly the wanted or needed product.

2.3 Online Buyer Profile

Having the goal to fill up the list of reasons for and against online shopping we should have a closer look at the different kinds of online buyers and especially their motivations. This investigation begins with the profile of typical Internet users. In contrast to today, the early Internet users were categorized as being young, male with a good education, prosperous, sophisticated and having a great credit rating.⁶² Since then, the Web has become more and more common and there- fore the demographics and usage of the Internet is getting more normative.⁶³ Therefore, broader Internet use implicates broader demographics of potential online customers.⁶⁴ But still, the developments in the E-Business area are far away from normalcy, even though the Internet euphoria has reached a main part of the population, there is a cleft between interest and active participation.⁶⁵ Trying to contribute to the explanation where this cleft is coming from is the main subject of this research.

According to TNSofres, the most favorite products of world-wide consum- ers participating in B2C E-Commerce in 2002 are - besides books, which are still the products most often purchased online - music/CD´s clothes and electronic i- tems.⁶⁶ As there seem to be reasons why some products are more often requested online than others, another goal of this analysis is to find consumers´ product- related motivations. Motivations are trying to explain the impulse (cause) for behavior,⁶⁷ which makes it necessary to consider them in this analysis of factors influencing online purchasing behavior.

Analyzing the online buyer profile, the Internet Shopping Report 2001 distinguishes between four different types of online buyers based on their motiva- tion to order online.⁶⁸ First, there are the “bargain-chasers“, who only shop online when they make a good deal, then there are the “time-savers“, whose reasons to buy online are convenience, including time saving. The next group are the “experi- ence-buyers“, who think that it is fun to shop online, and finally there are the

“information-seekers“, who almost never shop on the Web, but use the Internet as a source for information.⁶⁹ Summarizing the group specific main influencing factors, the “bargain-chasers“ are driven by price competitiveness, the “time-savers“ by convenience and the “experience-buyers“ by their positive general attitude towards online shopping. Thus, the first two motivations are already mentioned above as advantages of E-Commerce. The last group, the “information-seekers“, partly reflects the not-online buyers, making their profile interesting for the explanation why online purchases are not made.

Earlier exploitations referring to a comparison of Internet shoppers and non-shoppers found out that in general, online customers are more likely to be in search of convenience and variety, more impulsive and less risk-averse and not as conscious of brand and price as the customers deciding not to purchase online.⁷⁰ Transferring these differences between customers into influencing factors, the new ones found are: shopping purpose (reflecting the described impulsiveness of online buyers), perceived risk in general (so far only mentioned in connection with delivery concerns) and brand reputation, as convenience, wider choice range and price competitiveness are already mentioned as E-Commerce advantages in earlier sections.

3 A Framework for Factors Influencing Online

Purchasing Behavior:

In this part of the paper, the advantages and disadvantages of B2C E-Commerce from a consumer´s perspective, found and described earlier, as well as the different types of additionally found customer´s motivations are transformed into influ- encing factors accompanied by formulated hypothesis. The factors proposed to contribute to the final decision whether buying a product online or not are sum- med up in three main categories, which are: personality, shopping situation and product qualities.

An overview of all filtered and categorized influencing factors, as well as research´s further procedures to determine which factors are really influencing online purchasing behavior and if differences among American and German consumers exist, is given in Figure 4.

illustration not visible in this excerpt

Figure 4: Categorization of Influencing Factors on Online Purchase Behavior and Procedure of Analysis⁷¹

3.1 Personality

The term personality is one of the most iridescent in behavioral science, and meaningful operationalized personality features can contribute to describe consumers as well as to explain consumers´ purchasing behavior.⁷²

Five different personal terms are examined in the frame of this research, starting with Internet usage, going over to attitude towards online shopping, perceived convenience and risk, and ending with perceived trust.

3.1.1 Internet Usage

A behavior pattern very close to consumption is lifestyle, including information behavior⁷³, explaining why the factor Internet usage is chosen to possibly influence the decision whether products are bought online or not. It seems already proven that consumers who used the World Wide Web for a longer time period are more likely to use it for task-oriented activities⁷⁴ like shopping, making customers´ In- ternet experience becoming paramount.⁷⁵The results by Sismeiro and Bucklin also indicate that Web site visitors´ browsing experiences are predictive of Internet buying behavior.⁷⁶⁷⁷ Thus, as Robyn Greenspan states as well that an important factor of online purchasing behavior is tenure - as more experienced users, in con- trast to relatively new online users, immediately think of the Internet as a shop- ping option⁷⁸ - the following hypothesis is proposed:

H1: Online consumption behavior in each product category is influ- enced by the frequency of Internet usage.

3.1.2 Attitude towards Online Shopping

In former times, the role of attitude for the explanation of behavior was strongly overrated and more recent studies even changed the point of view entirely and tried to prove that behavior is determining attitude.⁷⁹ Summarizing research in this field, it seems appropriate to say that attitude and behavior are influencing each other reciprocally.⁸⁰ Just being interested on influences on consumers´ purchasing patterns, only the one-sided influence of attitude is considered, leading to the second hypothesis:

H2: Independent of product category, the customer ‘ s attitude towards online shopping contributes to the decision to or not to order online.

3.1.3 Perceived Convenience

Convenience is judged by the consumer by the whole shopping expenditure. Long business hours and the possibility of fast shopping are the dominant consumer ex- pectations concerning Convenience-Shopping. ⁸¹ This would imply that Internet shopping is a perfect example for convenient shopping. Suggesting that online shoppers are seeking stronger for convenience than not-online shoppers, the third hypothesis is:

H3: In each product category, the individual perception of online shop- ping convenience explains why some consumers buy online and some do not.

3.1.4 Perceived Risk

Risk is the resultant detriment possibility from the choice of a concrete behavior alternative, which is justified in the eventuation or non-eventuation of objective/ and or subjective uncertain occurrences, which can be endogenous as well as exo- genous and which are beyond the decision-maker´s control.⁸² Early research identi- fied that risk is perceived as being higher when doing online business instead of traditional business. This higher perceived risk can be explained by the two main sorts of concerns: concerns about the firm and concerns about technology,⁸³ which consumer have with purchasing online. Even though customers differ concerning their risk aversion, the following general hypothesis can be made.

H4: The customer ´ s perceived risk influences regardless of desired product the decision to purchase online or not.

3.1.5 Perceived Trust

Trust relates to risks founded by the uncertainty, if the vis-à-vis one represents his abilities correctly and if he uses these abilities in the trust-giver‘s interest.⁸⁴ The lack of trust in B2C is still a negative influence on the consumer´s purchase behavior in the online world.⁸⁵ This means, that missing trust in the security of online transactions is the reason for essential losses in E-Commerce sales and is therefore seen as one of the strongest buying barriers in E-Commerce.⁸⁶ To explain the higher degree of uncertainty when trading online, Mathias Klang pointed out that “(...) the size and anonymity of the Internet make it more difficult for a business-man entering into a transaction to judge the truth-worthiness of his counterpart.“⁸⁷ This leads to the following hypothesis:

H5: No matter in which product category, the level of perceived trust makes a consumer buy online or not.

3.2 Purchase Situation

The second main group of the set up framework of influencing factors is purchase situation, covering also five factors. Besides Internet shopping experience, shopping purpose, the importance of easiness of order procedure, payment options, and website usability is taken into consideration.

[...]

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¹ Shet, J. N./Eshghi, A./Krishnan, B. J., Internet Marketing, Forth-Worth 2001, p. 1.

² Kowalewsky, R., Die Sieger im Netz, in: Capital 14/2004, p. 55.

³ Korper, S., The e-Commerce book, San Diego 2001, p. xiii.

⁴ Pramongkit,P./ Muangthanya,Y./ Chaikiart,P. , ECRC, How to promote B2C, using

Online Customer Experience Analysis, 2002, URL: http://www.ecommerce.or.th/ nceb 2002/paper/12-How_to_promote_B2C.pdf, p. 1, Download: 01. Oct. 2004.

⁵ Meffert, H., Marketing - Grundlagen marktorientierter Unternehmensführung, 9th ed., Wiesbaden 2000, p. 917.

⁶ Raisch, W., The E-Marketplace - Strategies for Success in B2B Ecommerce, New York 2001, p. 1.

⁷ Keegan, W./Green, M., Global Marketing, 3rd ed., 2003, p. 1 et seq.

⁸ Fingar, P./Kumar, H./Sharma, T., Enterprise E-Commerce - The Software Component Breakthrough for Business-to-Business Commerce, Tampa 2000, p. 22.

⁹ Zwißler, S., Electronic Commerce - Electronic Business, Berlin 2002, p. 15.

¹⁰ Zwißler, S., Electronic Commerce - Electronic Business, Berlin 2002, p.11 et seq.

¹¹ For further description of the different business fields in E-Business have a look at

Zerdick, A./Picot, A. et al., Die Internet-Ökonomie - Strategien für die digitale Wirtschaft, 3rd ed., Berlin, Heidelberg, New York 2001, p. 219 in Anlehnung an Hermanns, A./ Sauter, M., Management Handbuch Electronic Commerce, München 1999, p. 23.

¹² Meffert, H., Marketing - Grundlagen marktorientierter Unternehmensführung, 9th ed., Wiesbaden 2000, p. 919.

¹³ As Meffert, H. in Marketing - Grundlagen marktorientierter Unternehmensführung, 9th ed., Wiesbaden 2000 on p. 919 continues: The integrated inset of marketing instru- ments in Business-to-Consumer E-Commerce contributes more to the success than in the area of Business-to-Business E-Commerce, where the market partners normally know each other and just use the Internet as a common technical platform for efficient transactions.

¹⁴ Preißl, B., E-Commerce - Erfolgsfaktoren von Online Shopping in den USA und in Deutschland, Berlin 1999, p. 14.

¹⁵ Dehio, J./Döhrn, R. et al., New economy - The German Perspective, Berlin 2003, p. 90.

¹⁶ Schäfer, R., Statement des Präsidenten des Bundesverbandes des Deutschen Versandhandels, 06. Nov. 2003, URL: http://www.versandhandel.org/presse/2003/ Rede_des_Praesidenten_6_11.pdf, p.7, Download: 02. Oct. 2004.

¹⁷ Nielsen//NR, July 2004, URL: http://www.internetworldstats.com/europe.htm#de, Date: 02. Oct. 2004.

¹⁸ Imcor, Neue Statistiken zur Internet-Nutzung, May 2004, URL: http://www.imcor.de/ scripts/show.php?rbr=d&ste=start&dtp=a&brw=ie, Date: 02. Oct. 2004.

¹⁹ eMarketer, Deutschland: B2C-E-Commerce-Umsatz in Milliarden USD, May 2003, URL: http://www.nfo-bi.com/bmwa/Faktenbericht_6/abbildungen/Folie341.JPG, Date: 02. Oct. 2004.

²⁰ ibidem

²¹ See Table 1, B2C E-Commerce Sales in Germany (in billion USD), Appendix A, p. i.

²² Kowalewsky, R., Die Sieger im Netz, in: Capital 14/2004 , p. 55.

²³ ECIN, Online-Einkauf: Selbstverständlich, 02. Feb. 2004, URL:http://www.ecin.de/news/2004/02/02/06690, Date: 02. Oct. 2004.

²⁴ Schneider, D./Gerbert, P., E-Shopping - Erfolgsstrategien im Electronic Commerce, Wiesbaden 1999, p. 30 et seqq.

²⁵ Capitals.com, Rank Order - Internet Users, 01. Aug. 2003, URL: http://www.capitals. com/rankorder/2153rank.html, Date: 02. Oct. 2004.

²⁶ See Table 2, B2C E-Commerce Sales in America (in billion USD), Appendix A, p. i.

²⁷ Kowalewsky, R., Die Sieger im Netz, in: Capital 14/2004 , p. 55.

²⁸ See Table 3, E-Commerce‘s Percentage of Total Retail Sales in Germany and the USA, Appendix A, p. ii.

²⁹ Willis, J., What Impact Will E-Commerce Have on the U.S. Economy?, in: Federal Reserve Bank of Kansas City, Economic Review, Volume QII, 2004, p. 57.

³⁰ Eicher, G., E-Commerce - Deutschland zum Teil Trendsetter, June 2004, URL: http:// www.cmerx.com /news/2004/06/ecommerce_deutschland_zum_teil_trendsetter, Date: 02. Oct. 2004.

³¹ Pastore, M., 120 Million Web Users Shop Online, 11. April 2004, URL: http://www. clickz.com/ stats/markets/retailing/print.php/338561, Date: 02. Oct. 2004.

³² FTC, Privacy on the Internet, March 2004, URL: http://www.ftc.gov/bcp/online/pubs/ online/cybrsmrt.pdf, p.2, Download: 02. Oct. 2004.

³³ See Figure 1, Appendix B, B2C E-Commerce Sales World-Wide (in billion USD), p. iv.

³⁴ Morton, F. S./Zettelmeyer, F./Silva-Risso, J., Internet Car Retailing, in: The Journal of Industrial Economics, Volume XLIX, No.4, 2001, p. 501.

³⁵ NRW Medien GmbH, E-Commerce, 2003, URL: http://www.media.nrw.de/infopool/ marktdaten/ _abb/E-Commerce_Januar_2003.pdf, p.1, Date: 02. Oct. 2004.

³⁶ Preißl, B., E-Commerce - Erfolgsfaktoren von Online Shopping in den USA und in Deutschland, Berlin 1999, p. 14.

³⁷ An interesting analysis about the roles of sexual preferences, primary place of online access, online experience, demographics and economic factors on the consumer´s purchasing decision was conducted by Koyuncu and Lien in E-commerce and consumer´s purchasing behavior, Applied Economics, 2003, 35, p. 721-726.

³⁸ Engelhardt, W. H./Gabriel, R./Gersch, M., Competence Center E-Commerce - Aktuelle Entwicklungen im E-Commerce, Bochum 2001, p. 28.

³⁹ Kowalewsky, R., Die Sieger im Netz, in: Capital 14/2004, p. 55.

⁴⁰ Ramsauer, M./Geiser, J.-M./Dietschi, R., Die digitale Signatur - technische, organisatorische und rechtliche Aspekte, in: Meier, A., Internet & Electronic Business - Herausforderung an das Management, Zürich 2001, p. 185.

⁴¹ Hagen, J., Sicherer Shoppen, in: Capital 8/2004, p. 114.

⁴² Ipsos Public Affairs, Concerns US Consumers Have about Making Internet Purchases, Dec 2003, URL: http://www.epaynews.com/statistics/purchases.html, Date: 02. Oct. 2004.

⁴³ Jung, R., Sichere Transaktionen im Internet steigern die Nutzerakzeptanz, in:

Information Management&Consulting 14, Special Issue: E-Commerce 1999, p. 99.

⁴⁴ ibid., p. 100.

⁴⁵ Zwißler, S., Electronic Commerce - Electronic Business, Berlin 2002, p. 44.

⁴⁶ Jarvenpaa, S. l., Tractinsky, N., Consumer Trust in an Internet Store: A Cross-Cultural Validation, Dec.1999, URL:http://www.ascusc.org/jcmc/vol5/issue2/jarvenpaa.html, Date: 02. Oct. 2004.

⁴⁷ Newton, C. J., Home Delivery Can Make or Break a B2C, in: Supply Chain Management Review, January/Februrary 2001, p. 21.

⁴⁸ Scott, S., Successful Shipping Determines Online-Shopping Satisfaction, Research Shows, in: Post-Crescent, The (Appleton, WI), 8th January 2001, p. 1.

⁴⁹ Vogler, M., Inhalte für Web-Auftritte, URL: http://www.martinvogler.de/de_angebote. html, Date: 02. Oct. 2004.

⁵⁰ Teege, G., E-Commerce qou vadis? in: Eggers, B./Hoppen, G., Strategisches E-

Commerce-Management (Erfolgsfaktoren für die Real Economy), Wiesbaden, 2001, p.634.

⁵¹ Meffert, H., Marketing - Grundlagen marktorientierter Unternehmensführung, 9th ed., Wiesbaden 2000, p. 920.

⁵² Amor, D., The E-Business-(R)Evolution, Bonn 2000, p. 49.

⁵³ Meier, A., Vom digitalen Produkt bis hin zum Customer Relationship Management, in: Meier, A., Internet&Electronic Business - Herausforderung an das Management, Zürich 2001, p. 15.

⁵⁴ Internetshopping Report 2001 - Käufer, Produkte, Zukunftsaussichten, Düsseldorf 2001, p. 29.

⁵⁵ Engelhardt, W. H./Gabriel, R./Gersch, M., Competence Center E-Commerce - Aktuelle Entwicklungen im E-Commerce, Bochum 2001, p. 27.

⁵⁶ Willis, J., What Impact Will E-Commerce Have on the U.S. Economy?, in: Federal Reserve Bank of Kansas City, Economic Review, Volume QII, 2004, p. 60.

⁵⁷ Amor, D., The E-Business-(R)Evolution, Bonn 2000, p. 52 et seq.

⁵⁸ Kowalewsky, R., Die Sieger im Netz, in: Capital 14/2004, p. 60.

⁵⁹ Examples given in Kowalewsky, R., Die Sieger im Netz, in: Capital 14/2004, p. 60 are: Special flight offers by Lufthansa and the Deutsche Bahn, selling cheap tickets over the Web.

⁶⁰ FTC, March 2004,Privacy on the Internet, URL:http://www.ftc.gov/bcp/online/pubs/ online/cybrsmrt.pdf, p.2, Download: 02. Oct. 2004.

⁶¹ Chang, J./Samuel, N., Internet Shopper Demographics and Buying Behavior in

Australia, in: The Journal of American Academy of Business, September 2004, p. 172.

⁶² Reinbach, A., Growing Weary of B2C, in: Future Banker, Vol. 4, Issue 3, 2000, p. 16.

⁶³ Fingar, P./Kumar, H./Sharma, T., Enterprise E-Commerce - The Software Component Breakthrough for Business-to-Business Commerce, Tampa 2000, p. 32.

⁶⁴ Reinbach, A., Growing Weary of B2C, in: Future Banker, Vol. 4, Issue 3, 2000, p. 16.

⁶⁵ Zwißler, S., Electronic Commerce - Electronic Business, Berlin 2002, p. 4.

⁶⁶ Traguth, T., E-Commerce in Deutschland, Nov. 2002, URL: http://medialb.-fh-karlsruhe. de/lectures/Globalisierung/contenct/E-Commerce_in_D.pdf., Date: 02. Oct. 2004

⁶⁷ Kroeber-Riel, W., Konsumentenverhalten, München, 1990, p. 136

⁶⁸ A different approach to categorize online consumers using their individual degree of privacy concerns is made by K. Sheehan in “Toward a Typology of Internet Users and Online Privacy Concerns“. A model of online user typology is given on p. 28, in: The Information Society, Vol. 18, 2002.

⁶⁹ Internetshopping Report 2001 - Käufer, Produkte, Zukunftsaussichten, Düsseldorf 2001, p. 23.

⁷⁰ Yang, B./Lester, D., Attitudes Toward Buying Online, in: Cyberpsychology & Behavior, Vol.7, Nr.1, 2004, p. 86.

⁷¹ source: own illustration

⁷² Trommsdorf, V., Konsumentenverhalten, Stuttgart 1989, p. 180-183.

⁷³ ibidem

⁷⁴ Novak, T. P./Hoffman, D. L./Yung, Y.-F., Measuring the Customer Experience in Online Environments: A Structural Modeling Approach, in: Marketing Science, Vol. 19, No.1, 2000, p. 36.

⁷⁵ ibid. p. 39.

⁷⁶ Sismeiro, C./Bucklin, R. E., Modeling Purchase Behavior at an E-Commerce Web Site: A Task Completion Approach, in: Journal of Marketing Research, Vol. 21, Issue 3, 2004,

p. 1-50.

⁷⁷ A further general model of online customer experience is developed in “Measuring the Customer Experience in Online Environments: A Structural Modeling Approach“ by Novak, Hoffman and Yung.

⁷⁸ Greenspan, R., Love around the Web,17. Feb. 2004, URL: http://www.clickz.com/stats/ markets/retailing/print.php/3313431, Date: 02. Oct. 2004

⁷⁹ Kroeber-Riel, W., Konsumentenverhalten, München 1990, p. 167 .

⁸⁰ ibid., p. 168.

⁸¹ Müller-Hagedorn, L., Zukunftsperspektiven des E-Commerce im Handel, Frankfurt am Main 2000, p. 192 et seq. (Swowboda Studie).

⁸² Ripperger, T., Ökonomik des Vertrauens: Analyse eines Organisationsprinzips, Tübingen1998, p. 19.

⁸³ Odom, M. D. et al. identified these different kinds of concerns in: Web Assurance Seals: How and Why They Influence Consumers´ Decisions, in: Journal of Information Systems, Fall 2002, Vol. 16, Issue 2, p. 231.

⁸⁴ Ripperger, T., Ökonomik des Vertrauens: Analyse eines Organisationsprinzips, Tübingen1998, p. 21.

⁸⁵ Debreceny, R. et al., New tools for the determination of e-commerce inhibitors, in: Decision Support Systems 34 (2002), p. 190.

⁸⁶ United reseach/ecollect, 2001,Vertrauen im Internet, Eine qualitative Onlinestudie, URL: http://www.ecollect.de/download/studien/vertrauen.pdf, p. 3, Download: 17. June 2004.

⁸⁷ Klang, M., Who do you trust? Beyond encryption, secure e-business, in: Decision Support Systems 31, Special Issue: E-Commerce 2001, p. 293 f.

• College: University of Duisburg-Essen
• Grade: 2,7
• Author: MBA, LL.M, Diplom-Kauffrau Silke Kühn (Author)
• Publication Year: 2004
• Pages: 89
• Catalog Number: V141245
• ISBN (eBook): 9783640509119
• ISBN (Book): 9783640509454
• Language: English
• Tags: Comparison, Online, Shopping, Behavior, American, German, Consumers