What Stopped Experienced Online Shoppers from Buying:

The Major Concerns during Annual Festival Season Sale

 

Neeti Gupta

Senior Research Fellow, Himachal Pradesh Business School, Himachal Pradesh University,

Summerhill, Shimla (H.P).

 

ABSTRACT:

An online festival sale is the most awaited event in India for online shoppers. The aim of this research is to identify the reasons for not shopping during festival season sale among experienced online MBA shoppers of HPUBS. The results of the study highlighted that 100 percent of students have regular access to the internet, have prior online shopping experience during festival sale season and were aware of online festival sale that started on 29th September 2019. Still, 32.3 percent of students did not purchase during the festival season. Among the organizational reasons, respondents showed concern about the quality; and delay during the sale; and among personal reasons, no money to shop and previous bad shopping experience during the festival season were the top most reasons for not buying. The results of the study can help the marketer to make strategies by  managing organizational and personal reasons causing hindrance in the way to shop.

 

 

 

INTRODUCTION:

In India, from Navratri onwards is a festival season. During this time, Indian customers shop for themselves, family and friends. Online festival season is a battle among online retailers benefiting customers in the form of great offers, freebies, and discounts. An influx of online festival sales with great offers, freebies, and discounts allure everyone. As per RedSeer report published in ET Bureau¹, the e-tailers in India achieved a record of $3 billion (about Rs 19,000 crore) of Gross Merchandise value during the sales period. Moreover, the annual festival sale was the success with a growth rate of 60-62% for Flipkart, 28 to 30% for Amazon and ~10% for others.

 

Grabbing the deals and discounts are the main known reasons to shop during festival season sale.

 

The gap was found in the literature where the focus of prior studies was on exploring motivators and hindrances to shop online. But, to date, no study has been conducted on the experienced customers for finding the reasons for not shopping online during festival season sale. The present study tries to fill this gap in the available literature on online retailing by conducting empirical research on experienced online shoppers with a special focus on MBA students of HPUBS, Himachal Pradesh University. The research was undertaken on MBA students as the internet is an integral part of their course as well as other parts of their life. Moreover, online shopping is trending among students as they are well versed with information technology which is at the core of online shopping.

 

REVIEW OF LITERATURE:

It is established that online shoppers who are younger, wealthier, better educated, have higher computer literacy, spend more time on their computer, spend more time on the internet, find on-line shopping to be easier and more entertaining, and are also more fearful of financial loss from on-line shopping (Swinyard and Smith)². In the past, researchers explored reasons influencing the non-acceptance of online shopping. Out of four groups of variables (i.e., consumer characteristics, contextual factors perceived uncertainty factors, and medium/channel innovation factors) that predict three types of online shopping hesitation (i.e., overall hesitation, shopping cart abandonment, and hesitation at the final payment stage). The strongest predictor of overall hesitation in the research is “consumers’ value-consciousness traits”, “Comparison shopping/need more information” for shopping cart abandonment and “online security/privacy” for hesitation at the final payment stage (Cho, Kang, and Cheon)³. The reasons why respondents do not prefer to shop online is that they are concerned about getting scammed by the seller, the quality of a product, security and privacy (Aziz and Wahid) ⁴.

 

Even though e-commerce companies have claimed success of annual festival sale but social media is full of grievances during festival season sale. According to Mugdha and Bansal⁵ for ET Online, consumer complaints surge 20 percent in the season of e-commerce sales. The complaints in the sector are around a deficiency in services, misleading advertisements, fake products, and payment issues. After analyzing the complaints on social media it was found that common complaints are regarding receiving defective or different products. No replacement for product bought during sale period even if it is in stock or no return policy adds to the suffering of consumers. Wrong specification or delayed delivery or delivery of someone else goods caused frustration among consumers. It was mentioned that pleasure to spot a deal with huge discount leads to disappointment when substandard product is received.

 

Customers are found to be skeptic about the real discount. With no reference point, it is difficult to find whether the product is highly discounted during the festival season or remains discounted the whole of the year. Some mentioned that a huge discount is on older inventory. Whereas, others mentioned that many of the good deals expire within a few minutes. A short window of time leads to the temptation to buy  goods not required or leads to frustration due to out of stock pop-ups. Impulsive buying also leads to frustration as in online shopping there is a time lag between buying and receiving the good. Another complaint is regarding out of stock items that become in stock as soon as the sale is over. In general, the festive spirit is drowned due to a organizational or personal reasons among experienced online shoppers.

 

OBJECTIVE OF THE STUDY:

In the light of the review of literature and gap found, the objective of this research is to examine the reasons for the non-buying behavior of students during online festival season sale.

 

RESEARCH METHODOLOGY:

The data of the study has been collected from MBA students of HPUBS. A self-administered questionnaire was distributed in the class and collected thereafter. Data was collected on the 11th of October, 2019. In total 19 questions were asked. The first section consisted of 6 questions related to general information about gender and online shopping behavior. The next section consisted of 13 statements regarding the reason for not shopping online during festival season related to organizational reasons (8) and personal reasons (5). All the responses were found complete in all the respect and used for all the subsequent analysis. Data were analyzed using Statistical Package for Social Sciences (SPSS 21 Premium). Descriptive analysis was done regarding gender, online shopping behavior and statements for not shopping online during festival season sale.

 

ANALYSIS AND INTERPRETATION:

Descriptive analysis shows that out of a total of 130 students, 66.2 percent (n=86) are male and 33.8 percent (n=44) are female. 100 percent of students have a regular internet connection, prior online shopping experience during the annual festival season sale and were aware of festival season sales. For shopping, students use their savings (73.8 percent), or ask from parents (81.5 percent) or use their debit card (60 percent) which parents have given them. Analyzing deeper, it is found that 43.08 percent of students use all of the three options, 9.23 percent of students only depend on their savings, 13.84 percent ask from parents only and 4.6 percent use their debit card to make a purchase only. Related to using two of the options, 16.92 percent of students use their saving along with asking from parents, 7.69 percent use ATM or ask from parent and 4.6 percent use their saving or ATM.

 

 

 

 

 

 

 

 

 

 

 

 

Table 1: Concerns during online annual festival sale

	Statements	Response	No	Percentage	Rank
Organizational Reasons	1.     Prices are inflated during the sale	Yes	12	28.6	VI
		No	30	71.4
	2.     Orders are delayed due to rush	Yes	26	61.9	II
		No	16	38.1
	3.     During sale retailers sell duplicate products	Yes	20	47.6	III
		No	22	52.4
	4.     Quality of products are not up to mark during the sale	Yes	30	71.4	I
		No	12	28.6
	5.     The product I selected got out of stock before making the final payment	Yes	14	33.3	V
		No	28	66.7
	6.     The product of my choice was out of stock when the sale started	Yes	16	38.1	IV
		No	26	61.9
	7.     I didn’t buy due to price fluctuation	Yes	9	21.4	VII
		No	33	78.6
	8.     I didn’t buy due to payment failure	Yes	8	19	VIII
		No	34	81
Personal Reasons	1.     My previous experience during sale was not good	Yes	18	42.9	II
		No	24	57.1
	2.     I didn’t have money to shop	Yes	24	57.1	I
		No	18	42.9
	3.     I was busy	Yes	15	35.7	III
		No	27	64.3
	4.     I purchased just before the sale	Yes	8	19	V
		No	34	81
	5.     I could not make my final decision due to the availability of too many offers	Yes	10	23.8	IV
		No	32	76.2

 

Table 1 presents the reasons for not buying during festival season sales. Statements are organized into organizational reasons and personal reasons for not shopping during festival season sale. In case of organizational reasons, the main reason for not to shop is that students think that the quality of the products is not up to mark during the sale. 71.4 percent of respondents feel this way. The second and third reasons are a delay in receiving orders due to rush hours (61.9 percent) and during the sale retailers sell duplicated products (47.6 percent) respectively. Product of choice was already out of stock (38.1 percent), product I selected got out of stock before making final payment (33.3 percent), inflated prices (28.6 percent), price fluctuation (21.4 percent) and failure of payment (19 percent) are respectively at fourth, fifth, sixth, seventh and eighth place.

 

For personal reasons, as research is on students, I didn’t have money to shop (57.1 percent) is the first reason followed by prior bad experience during the sale (42.9 percent). I was busy (35.7 percent), I could not make my final decision due to the availability of too many offers (23.8 percent) and I just purchase before sales (19 percent) are ranked third, fourth and fifth respectively

 

SUGGESTIONS:

Customers are an important part of the business. Now days customers have the option to spend their money online or offline. It is mentioned in the literature that 5% of customer retention can increase profit by 25 to 95 percent. In the present study, 32.3 percent of the experienced and regular online shoppers do not prefer to buy online during festival season sales. Encouraging them will help e-tailers to increase their market share as well as profit.

 

The study revealed that major organizational reasons for not shopping online during festival season sales are because of poor product quality, and the perception that during sale retailers sell duplicated products respectively at first and third place. Therefore, companies should convey quality assurance along with assurance regarding genuinely of retailers selling the products on their portal. The second major organizational reason is a delay in delivery due to rush hours. Major e-tailers in India like Flipkart and Amazon have significantly expanded their supply chain network before festival season sale this year. E-tailers are putting efforts to reduce delivery time. Therefore, improvement in delivery time must be conveyed to the experienced customers to encourage them to buy during festival season sale.

 

For personal reasons, I didn’t have money to shop is the main reason for not to shop. Therefore, it is suggested that e-tailers should send personal reminders days before announcement of the festival season date the dates of the festival season to old customers especially students or age groups which is dependent on parents. It will encourage such a group to save money or arrange money accordingly for festival season sales.

 

The second personal reason is prior bad experience during sale season. It is a proven fact that even if a customer is not satisfied they would not a complaint. To handle the bad experience, online retailers should give a personalized touch in online shopping by sending an automated mail to all the customers who have made a purchase during the sale season, with an option to share their experience both good and bad. Lastly, all the complaints during the sale season must be handled effectively. Reaching out to the customer is the best way to resolve the issues with customers.

 

CONCLUSION:

The paper evaluated reasons for not shopping during annual online festival sales by students of MBA, HPUBS. The present research findings help in bridging the gap found in the online retailing literature. The study has made an important contribution to enhance the understanding of the reasons why experienced online shoppers are reluctant to buy during the annual online festival sale. Top two reasons for not buying during festival season sale are related to organizational reasons. Suggestions given by the author can help the marketer to make strategies for ensuring the engagement of students in annual festival sales by handling important organizational and personal reasons causing hindrances in the way to shop.

 

LIMITATION AND DIRECTION FOR FUTURE RESEARCH:

The present study suffers from limitations that pave the way for future research. First, this study was conducted on MBA students only. Online shopping is accepted by customers with different occupations. So, future research can be conducted on customers with different occupations. Second, the study examines only statement of concern regarding organizational and personal reasons. The influence of these statements on making a purchase during the online festival sale season must be conducted to understand the impact. Lastly, the present study was conducted on 130 students out of which only 42 respondents qualified for further analysis. For a generalization of the results, a future study on a larger number of respondents can be conducted.

 

REFERENCES:

1.     ET Online Newspaper. Oct 11, 2019. Amazon, Flipkart generate Rs 19,000 cr in festive sales, Flipkart takes lead. Available on https://economictimes.indiatimes.com/small-biz/startups/newsbuzz/amazon-flipkart-sales-generate-rs-19000-crore-in-6-days/articleshow/71491146.cms

2.     Swinyard, W. R., and Smith, S. M. (2003). Why people (don't) shop online: A lifestyle study of the internet consumer. Psychology and Marketing , 20(7), 567-597.

3.     Cho, C.-H., Kang, J., and Cheon, H. J. (2006). Online Shopping Hesitation. Cyberpsychology and Behavior , 9(3), 261-274.

4.     Aziz, N. N., and Wahid, N. A. (2018). Why Consumers are Hesitant to Shop Online: The Major Concerns towards Online Shopping. International Journal of Academic Research in Business and Social Sciences , 8 (9), 1175-1185.

5.     Mugdha, V., and Bansal, V. (2018). Consumer Complaints May Surge 20% in Season of Ecommerce Sales. Economic Times.

 

 

Accepted on 10.05.2020           ©AandV Publications All right reserved