The online challenge
Factors influencing students buying behavior online
Authors:
Carolina Jönsson 19880624 Jens Gustafsson 19890815 Supervisor: Mosad Zineldin Examiner: Anders Pehrsson Date: 2014-05-30
Abstract
Abstract
Linnaeus University, School of Business and Economics Master Thesis 15 credits, Course 4FE07E, Spring 2014
Title: The online Challenges – Factors influencing students buying behavior online Authors: Carolina Jönsson, 880624
Jens Gustafsson, 890815
Tutor: Professor Anders Pehrsson Examiner: Professor Mosad Zineldin
.
Purpose: The purpose of this study was to find what factors, and to what extent these factors, affects students buying behavior regarding textbooks online.
Method: A quantitative and deductive approach by collecting data using a questionnaire through Facebook. The population for this study is University students in Sweden, and convenience sampling was used. A descriptive research design was chosen for this thesis.
Conclusions: In this research it was clear that students did not experience perceived risk when purchasing online. Regarding the price as an affecting factor, there was an impact on the students buying behavior. Also the convenience was seen as a factor that was influencing a purchase. The two last factors, social influence and brand awareness, was affecting the students buying behavior but should be treated carefully.
Paper type: Research paper.
Keywords
Consumer buying behavior, Online buying behavior, Perceived risk, Price, Convenience, Social influence, Brand awareness.
Thanks
Växjö 2014-05-30
This thesis has been a great challenge and a learning experience where we gained a deeper knowledge about consumer buying behavior including affecting factors.
We would like to thank Professor Anders Pehrsson and Professor Mosad Zineldin who constantly provided us with their expertise and guidelines throughout the thesis. We are also grateful for the feedback and suggestions for improvements from our opponents.
Most of all we want to thank the respondents of the thesis which most of them not only answered one questionnaire, but two.
____________________ ____________________
Carolina Jönsson Jens Gustafsson
Contents
1 Introduction _________________________________________________________ 1 1.1 Background ______________________________________________________ 1 1.2 Problem discussion ________________________________________________ 2 1.3 Purpose _________________________________________________________ 5 1.4 Delimitations ____________________________________________________ 5 1.5 Report structure __________________________________________________ 5 2 Theoretical framework, research hypothesis and research model _____________ 7 2.1 Consumer buying behavior __________________________________________ 7 2.1.1 Student buying behavior online ___________________________________ 8 2.2 Perceived risk ____________________________________________________ 9 2.3 Price __________________________________________________________ 10 2.4 Convenience ____________________________________________________ 11 2.5 Social influence _________________________________________________ 11 2.6 Brand awareness _________________________________________________ 12 2.7 Hypotheses and research model _____________________________________ 13 2.7.1 Hypotheses __________________________________________________ 13 2.7.2 Research model ______________________________________________ 15 3 Method ____________________________________________________________ 16 3.1 Research approach _______________________________________________ 16 3.2 Research design _________________________________________________ 16 3.3 Data collection __________________________________________________ 17 3.4 Population and sample selection _____________________________________ 17 3.5 Preparatory data collection _________________________________________ 18 3.6 Operationalization, measurements of variables and questionnaire __________ 19 3.6.1 Operationalization ____________________________________________ 19 3.6.2 Measurements _______________________________________________ 20 3.6.3 Questionnaire _______________________________________________ 21 3.7 Research quality _________________________________________________ 22 3.7.1 Reliability ___________________________________________________ 22 3.7.2 Validity _____________________________________________________ 23 4 Analysis and results __________________________________________________ 24 4.1 Analysis procedure _______________________________________________ 24 4.2 Frequencies _____________________________________________________ 24 4.3 Reliability analysis _______________________________________________ 25 4.4 Correlation analysis and descriptive statistics __________________________ 26 4.5 Regression analysis _______________________________________________ 27 4.5.1 Control variable _____________________________________________ 27 4.5.2 Hypothesis testing ____________________________________________ 28 5 Discussion __________________________________________________________ 31 5.1 Price positive influence on students buying behavior ____________________ 31 5.2 Convenience positive influence on students buying behavior ______________ 32 5.3 Social influences positive effect on students buying behavior ______________ 33 5.4 Brand awareness positive influence on students buying behavior ___________ 33
5.5 Perceived risk negative influence on students buying behavior _____________ 34 6 Conclusions, contributions and managerial implications ___________________ 35 6.1.1 Conclusions _________________________________________________ 35 6.1.2 Contributions and managerial implications ________________________ 35 7 Limitations and future research ________________________________________ 38 References ___________________________________________________________ 40 Appendices ___________________________________________________________ I Appendix A Questionnaire English _______________________________________ I Appendix B Questionnaire Swedish _____________________________________ IV
List of Tables
Table 1 Report structure _________________________________________________ 5 Table 2 Operationalization ______________________________________________ 19 Table 3 Measurements _________________________________________________ 20 Table 4 Frequencies ___________________________________________________ 25 Table 5 Reliability analysis _____________________________________________ 26 Table 6 Correlation analysis and descriptive statistics _________________________ 26 Table 7 Regression analysis _____________________________________________ 28
1 Introduction
In this introducing chapter a background about the developing online retailing market is presented, followed by a problem discussion describing the opportunities and problems regarding online buying behavior. It also brings information regarding the influence of different factors and the gap in existing literature, which ends in the purpose of the study. The delimitations are presented and the report structure for the remaining part of the thesis is lastly presented to give the reader short information about each chapter.
1.1 Background
One of the most rapidly growing forms of trade today is online shopping (Dawes and Nenycz, 2014) which have changed the purchase behavior of consumers during the last decade (Sands et al., 2010). According to Santos and Ribiero (2012), the amount of Internet users are growing fast worldwide, both with first time online shoppers and already existing online shoppers (Sands et al., 2010). This has led to online retailers being forced to expand and adapt to be able to handle the amount of new existing consumers (Dawes and Nenycz, 2014). In the European Union, Sweden is one of the most well connected countries regarding number of households that is owns broadband (Santos and Ribiero, 2012), this could be an underlying reason why online purchasing is common in Sweden (Ebarometern, 2013)
Since the market has grown, online retailers have accomplished a higher standard which have resulted in more convenient solutions for consumers, for example by a higher e- service quality to overcome barriers and build relationships, which in turn has increased the level of satisfaction (Liang et al., 2008; Chang and Wang, 2011). Online retailers’
investment in promotion has also been positive for the online consumers, since it is easier to find accessible information about different products and therefore a greater range of products (Jie et al., 2010). When operating online consumers can more easily compare and switch between companies, which have made it difficult for companies to make their brand the obvious choice (Liang et al., 2008). The factors affecting online shopping behavior have been discussed in previous literature and is suggested to be affected by different factors such as perceived risk (Forsythe et al., 2006; Bianchi and Andrews, 2012), price (Landström and Löwegeren, 2009; Delafrooz et al., 2010),
convenience (Jiang et al., 2013; Santos and Ribiero, 2012), social influences (Kuan et al., 2014), brand awareness (Foucault and Scheufele, 2002).
In Sweden, the market for books is continuously increasing online and follows the trend of the overall online purchasing evolvement resulting in almost half of the books in Sweden now are sold online (Ebarometern, 2013). One large segment for book companies are students because this group is purchasing a lot of textbooks, the main part of the group consist of University and College students (Foucault and Scheufele, 2002). This group is stated to purchase online due to the fact that this group generally belongs to a younger generation (people born between 1994 and 1977) who have grown up with the Internet and are experienced Internet users (Noble et al., 2008). Since factors affecting consumers online buying behavior differs within the existing literature (Dabholkar et al., 2009; Delafrooz et al., 2010; Jiang et al., 2013) this will be further investigated in this study with a focus on University and College students (furthermore named as “students”).
1.2 Problem discussion
The development within e-commerce has created an opportunity for consumers to benefit from online retailers, such as access to a larger range of products and the possibility of comparing prices and products with other online retailers, but also offline retailers (Metters and Walton, 2007; Kwon and Lennon, 2009). Since online shopping is the most rapid growing form of trade, the shopping behavior of consumers continuously change which makes it difficult for companies to follow the ongoing development (Dawes and Nenycz, 2014). The question of what triggers a consumer to shop online is important for companies to find out to be able to recruit new buyers in order to expand the market base (Foucault and Scheufele, 2002) and it is of high importance to update research within this area because the buying behavior constantly evolves (Dawes and Nenycz, 2014).
Since the market online has expanded and there is a big range of companies that is competing against each other, it creates an advantage for the consumers regarding the price of the products, often in the form of discounts, sales, coupons, deals and other value creating methods according to Liang et al. (2008). Landström and Löwegren (2009) stated that the price is seen as the most dominant factor for consumers when
deciding which retailer to purchase from. Also when it comes to students, the price is the main reason for choosing to shop online (Delafrooz et al., 2010) and a competitive price could therefore attract consumers to online stores (Malik and Gupta, 2013). In contradiction to these findings, Focault and Scheufele (2002) found that cost savings (e.g. discounts) was not to be of importance among students since the relevance of getting a better deal online was low. Moreover Scarpi (2012) suggested price is not always the dominant factor, it could be something negative for consumers who value other factors higher than the price, and the price is only seen as an obstacle to get rid of before getting access to the actual product.
Factors affecting consumers online buying behavior differs within the existing literature (Dabholkar et al., 2009; Delafrooz et al., 2010; Jiang et al., 2013). Dabholkar et al.
(2009) emphasized the importance of social influence while Delafrooz et al. (2010) omitted social influence and focused on concepts such as convenience and price. Wood and Hayes (2012) describes that the average consumer is influenced somehow by outside factors like judgments and attitudes. Social influences has an impact on the choice of brand or product which could be an external factors influenced from friends and family (Armstrong et al., 2009), or even online product ratings from previous customers (Sridhar and Srinivasan, 2012). These social factors could influence a consumer not to buy from a certain web page and should therefore be carefully managed by online sites (Dabholkar et al., 2009). Other factors, such as convenience, are stated to be important for the consumer because it is something that could be determinant for the consumer during an online purchase (Jiang et al., 2013). According to Santos and Ribiero (2012), shopping convenience, accessibility and a wide range of products is what consumers are expecting from an online retailer. Time is seen as an important factor of convenience according to Beauchamp and Ponder (2010), it is something consumers value highly and could be a determinant factor of the buying behavior online.
According to Delafrooz et al. (2010), web pages that differentiate themselves from competitors is more likely to attract consumers to their web page when the price no longer is the dominant factor, if there is no distinction, price becomes more important.
Chang and Wang (2011) describes that the design of a website is an important factor since it affects both customer satisfaction, consumer perceived value and the
trustability. A lack of trustability creates uncertainty, and consumers who perceive a website as risky will purchase the product from a different online retailer (Chang and Tseng, 2013). Risk is assumed to be higher when shopping online compared to offline (Forsythe et al., 2006) and could affect consumers purchase intention (Bianchi and Andrews, 2012). Consumers who previously have conducted a purchase online are more likely to feel less risky (Sakkthivel, 2013). Brand awareness allows consumers to feel secure and sure about a product because it is connected to how familiar the customer is with the brand and the recognition of a brand (Keller, 1993). Hsu et al. (2007) argued that the more knowledge consumers have about a brand, the more likeliness for them to make a purchase. In addition, Foucault and Scheufele (2002) found that the more sites selling textbooks students could name, the more likely that they previously would have bought textbooks online and intended to buy textbooks online in the future.
The majority of students belong to the younger generation (Parment, 2013), which is stated to be experienced Internet users (Noble et al., 2008). The younger generations often find information online from marketing where these consumers spend their time online, such as social media, newsletters and more (Lindstedt and Bjerre, 2009).
According to Foucault and Scheufele (2002), there is a high level of knowledge in how to find information among students, which could be explained by the economic situation since students generally do have a tight budget combined with Internet experience (Noble et al., 2008)
By conducting this research on students belonging to the younger generation, the study can contribute to existing research by adding information about buying behavior of this particular group who grew up with Internet and therefore are more experienced (Noble et al., 2008), which possibly influences their buying behavior online. Students as a segment generally have a limited amount of money compared to workers (Foucault and Scheufele, 2002), which can result in different outcomes compared to other researches, for example, investigating different age, income and demographics among the population (Forsythe et al., 2006; Santos and Ribiero, 2012; Jiang et al., 2013). It is also important to add information to existing literature by conducting a new updated research since online shopping is continuously becoming more widespread (Sands et al., 2010). Moreover, buying behavior could be different depending on country and culture (Foucault and Scheufele, 2002). Also focusing on a specific type of shopping behavior
and not general online shopping behavior is beneficial because the behavior could be different depending on product categories (Chang and Wang, 2011; Malik and Guptha, 2013).
1.3 Purpose
The purpose of this study is to find what factors, and to what extent these factors, affects students buying behavior regarding textbooks online.
1.4 Delimitations
Due to time and resource restraints the study was delimited to only investigate students from Sweden that could be reached through the Internet. The thesis investigated the concepts of buying behavior, perceived risk, price, convenience, social influences and brand awareness, other concepts within the area was not investigated because of the limited time, the concepts used was perceived to be of importance for the subject.
1.5 Report structure
The structure of the report can be seen in Table 1, which explains the following path of the thesis.
Table 1 – Report structure
Chapter 2
Theoretical framework, research hypotheses and model
Chapter two presents relevant theories for the research, consumer buying behavior, student buying behavior, perceived risk, price, convenience, social influences and brand awareness. From the theories hypothesis was generated and a model to further show the relation between the concepts was developed.
Chapter 3 Method
Chapter three explained the methods chosen for the path of collecting data and also how the data was processed.
Chapter 4
Analysis and results
Chapter four takes a close look at the results by analyzing it in SPSS, further the process of each analyze is explained.
Chapter 5 Discussion
Chapter five connects the literature with the findings of the research to be able to explain the connections found or not found. It discussed the hypotheses and further information received from the data.
Chapter 6
Conclusions, contributions and managerial implications
Chapter six presented a conclusion of the purpose and also discussed the contributions and managerial implications.
Chapter 7
Limitations and further research
Chapter seven discussed factors limitation in the study and made suggestions for future research.
2 Theoretical framework, research hypothesis and research model
This chapter begins with an explanation of the online consumer buying behavior, including students buying behavior online as a focus of this thesis. The next parts addresses the concepts of perceived risk, price, convenience, social influences and brand awareness will be explained followed by hypotheses derived from the concepts, it ends with a model that displays the relationship between the concepts.
2.1 Consumer buying behavior
Armstrong et al. (2009) explains the consumer buying behavior as the understanding of how consumers spend their money, for example what they buy, which channels they use, when they are buying and why they are buying. According to Oxholm Zigler (2008), the consumer buying behavior is affected by the buyers´ personal factors including age, occupation, economic situation, lifestyle, personality and image. All these factors are important and will somehow have an impact on the buyer behavior and decisions. Delafrooz et al. (2010) tells us that the economic situation of a consumer is one of the factors with the biggest impact on the buying behavior, especially in online shopping where price is a dominant factor. According to Armstrong et al. (2009), social factors also have a big impact on the consumer buying behavior, beyond the economic situation. Dabholkar et al. (2009) tells us that the social factors and the economic factors affect the buying behavior in different ways, based on satisfaction levels. The economic factors affects the buyers satisfaction regarding fulfillment and goal attainment, and the social factors affects the satisfaction regarding social presence and social exchange (Dabholkar et al., 2009). The economic factors, according to Armstrong et al. (2009), refer to the consumer´s personal economic situation. This includes factors like income, savings and interest rates, and is important from a consumer perspective since it will affect the choice of product. A consumer´s social life could be affecting the buying behavior as well. According to Oxholm Zigler (2008), social factors combined will lead to a consumer buying decision towards a specific store that can provide the customer with the product that is the most satisfying option. The consumer buying behavior has been changing since the rapid development in the online shopping market (Sands et al., 2010), because of this, online retailers has developed their strategies towards consumers to satisfy their needs (Sakkthivel, 2013). According
to Noble et al. (2008), it was the younger generation that advocated this new purchasing behavior. They were the first generation to grow up with Internet and technology, and they are now the largest group of online consumers today. The younger generation is experienced Internet users with a high level of knowledge about Internet usage and online purchasing (Kumar and Lim, 2008; Parment, 2013).
2.1.1 Student buying behavior online
According to Foucault and Scheufele (2002), students’ buying behavior has been changing drastically since purchasing online has been generally accepted and popular. A purchase at the traditional stores around campus and in the city where the university is located is being more and more replaced with online purchasing. Delafrooz et al. (2010) explains that the reason for this changing behavior is that students are looking for a more convenient way to shop. To shop online also enables them to find information about the product, compare prices from different retailers and choose from a wider selection of product. Also Kacen et al. (2013) describes the benefits from online shopping as a convenient way to shop regarding time savings, but also be able to take part in great offers that will reduce costs. Online purchasing will in the end save the students time and money, which is the most important factors that motivates consumers to shop online in general (Delafrooz et al., 2010). Parment (2013) explains that the majority of students belong to the younger generation. These individuals often share the same type of values since they are raised in the same era and share historical moments and certain happenings that they can relate to together. Noble et al. (2008) explains that because of the younger generation has grown up with Internet and new technology they are experienced Internet users, which has shaped and developed the online shopping.
The younger generation is also the best-educated generation so far, and the most culturally diverse generation, something that been creating an overall open-minded attitude. This attitude, together with an informative approach has been important in their consuming behavior, and with their well developed skills regarding Internet usage, the buying behavior online have been formed and developed out of this ground. According to Parment (2013), The younger generation has a characteristic purchasing behavior from using new technologies like smart phones so that they can be online all the time.
This constant access to Internet has made the younger generation used to a constant flow of information through social media and other websites, which enables them to
choose which information to take in and process. This flow of information also includes companies where the consumers can choose which companies to follow and communicate with (Parment, 2013).
2.2 Perceived risk
Zimmer et al. (2010) describes risk as the outcome of uncertainty during a process, something that can appear when sharing personal information. According to Forsythe et al. (2006), there is a higher level of perceived risk among consumers while shopping online than in traditional offline stores. Bianchi and Andrews (2012) explains that perceived risk is affecting the consumers purchase intentions, since the negativity that perceived risk causes it is affecting the online consumer behavior. Forsynthe et al.
(2006) emphasizes that there is three main risks factors that consumers are facing when purchasing online: financial risk, product risk and convenience risk. It is when consumers are engaging in new type of activities where consumers are experiencing risks and uncertainty (Chang and Tseng, 2013). According to Sakkthivel (2013), consumers that previously has conducted a purchase online are more likely to feel less risky and has develop trust over purchasing over the Internet in general, something that could affect the trust for a specific online retailer. Becerra and Korgaonkar (2011) explain trust as a desire to be vulnerable in a situation when another part is in charge, despite the involvement of risk. Trust is what makes consumers safe and comfortable to share personal information and go through transactions during a purchase (Bianchi and Andrews, 2012). Bianchi and Andrews (2012) also describes trust as an important factor that is closely related to perceived risk. Since there is a higher level of risk when purchasing online, the trust becomes a very important factor for consumers. It is therefore important for consumers that a website has an trustworthy design, something that could eliminate possible risks (Lindstedt and Bjerre, 2009). According to Chang and Tseng (2013), it is the design of the website that attracts consumers, a positive online image that will reduce uncertainty and risk-taking and increase the trustability.
Chiu et al. (2009) argued that fulfillment plays a very important role regarding the trust of the customer, which can be described as the belief that a company would not act opportunistically against the consumer. Lee et al. (2011) found that a high level of trust makes the information of the website become meaningful and have an impact on customers’ decision making and purchase intention. When consumers perceives a
website as risky, it is less likely that the customer will purchase the product from that specific online store (Chang and Tseng, 2013). Krishna Naik et al. (2010) also found similar results explaining that the biggest risks consumers are facing when purchasing online can be reduced with companies customer service: how fast the service is, how accurate the transactions are and the level of security. Wang et al. (2011) explains that actions from a company could reduce the level of risk which could be the service a company provides.
2.3 Price
Price is one important factor consumers consider when purchasing online and could be the determinant factor concerning buying decisions (Landström and Löwegren, 2009).
Pan et al. (2013) explains that consumers usually associate a higher price with high quality, something that may vary in different product categories or purchase channels, especially when purchasing online. Because of the Internet, consumers have more information about the price of every specific product from all online retailers that are available and can be more selective about which online retailer to purchase from (Baye et al., 2007). Since consumers value the price factor highly, price comparison sites receives more and more attention, but the price comparison works more like a convenient service than a direct purchase at the online retailer service (Delafrooz et al., 2010). If the price level is the same between competitors, consumers can be affected by other value creating factors such as free shipping or time of delivery (Delafrooz et al., 2010; Luo and Chung, 2010). Luo and Chung (2010) found consumers to be affected by the reputation of online retailers and thereby online retailers have different price strategies depending on their reputation. Customers could feel smart and good about their purchase if they get discounts or other price compensations (Oxholm Zigler, 2008), which is factors that increase the sales (Landström and Löwengrip, 2009). Price discounts are the most traditional form of sales promotion and are something that consumer’s value high (McKechnie et al., 2012). Baye et al. (2007) stated that to capture consumers, companies must focus on having the right pricing strategies at the right moment, one factor that consumers respond to is price differentiation where different segments receive a special price, such as student discounts (Oxholm Zigler, 2008; Landström and Löwengrip, 2009). According to Scarpi (2012), the price is not always the factor that comes first in mind for the consumers. The price can sometimes be a negative thing for consumer who values other factors higher than the price, for
people that focus on other determinants, the price is seen as an obstacle that is in the way and prevents the consumer to get access to the product (Scarpi, 2012).
2.4 Convenience
Brown and McEnally (1992) defined convenience as “ reduction in the amount or consumer time and/or energy required to acquire, use, and dispose or a product or service relative to the time and energy required by other offerings in the product/service class” (Brown and McEnally, 1992 p. 49). According to Jiang et al. (2013), shopping convenience is a dominant factor for consumers to purchase online instead of in traditional offline stores. Online consumers are looking for convenience, accessibility and a wide selection of products this is only attractive if the online retailer has developed a simple and informative online store (Santos and Ribiero, 2012). Mazaheri et al. (2010) explains the value of the available information on a website, and how this will affect the consumer's buying behavior because of their capacity to search and find what they intend to find in a matter of easiness and time. With a big range of products, available information about the products and multiple service offers, the consumer can decide which factor that is the most important one (Mazaheri et al., 2010). Price comparison websites works like an online-service that allows consumers to compare prices between various online retailers, which is convenient and valuable (Delafrooz et al., 2010). A price comparison site works as aggregators that collect data from online retailers to compile and present it for consumers (Laffey, 2010). The price comparison allows the consumers to find the cheapest product on the market from different online retailers, with help from price comparison websites, or by the consumer manually themselves (Malik and Guptha, 2013). Beauchamp and Ponder (2010) explains that consumers appreciate different types of convenience that can be perceived during the retail experience. One type of convenience is time saving, which is an important factor for consumers when choosing to shop online. Time is an non-monetary factor, but is something that today´s consumer value high and influences the buying behavior.
Another type of convenience is service, which also is a dominant factor since it allows the customer to go through the purchasing process easier, and at the same time reducing uncertainty and risk (Beauchamp and Ponder, 2010).
2.5 Social influence
Kuan et al. (2014) define social influence as “social influence refers to the modification of an individual's responses in reaction to the actions of another” (Kuan et al., 2014, p.152). Wood and Hayes (2012) describe it as the impact that other people have on consumer´s decision making during a purchase. In an individual purchase when the consumer is making a buying decision, the average consumer is influenced by outside factors like judgments and attitudes to some extent. Also Oxholm Zigler (2008) explains that a consumer´s social life could be affecting their buying behavior. External factors like friends, small groups, family, social roles and status could have an impact of the choice of product (Armstrong et al., 2009). Oxholm Zigler (2008) describes that various type of factors combined will lead to a consumer buying decision towards a specific store or brand that can provide the customer with the most satisfying option. According to Kuan et al. (2014), social influences through social networks, like Facebook, can stimulate unplanned purchases. Social networks provide an effective channel for consumers to share their information about products among friends and family.
Andrews and Bianchi (2013) tells that consumer’s personal network in social media is influencing their buying decision, but that the influence is limited. However, Dias (2012) presents a research revealing friends to have a big impact on a consumer. The research also states that students often base their choice of College or University on what their friends tells them, which shows the effect social influences could have by affecting life changing decisions. Lee et al. (2011) explains that sharing between people in social media creates a social pressure on individuals since they get vulnerable from a unintentional flow of information. The information can be positive or negative, depending on each individual if they adopt or refuse the information. There are also other external factors that can affect a consumer's buying behavior, like online product ratings (Sridhar and Srinivasan, 2012), and the amount of customers that previously bought the same product (Kuan et al., 2014)
2.6 Brand awareness
Keller (1993) explains that brand awareness occurs when the customer is familiar with the brand and hold favorable brand-associations in memory. Brand awareness is manifested in forms of brand recall and brand recognition. Brand recall is when a consumer remembers a certain brand name when asked to say a brand name of a certain product. Yen (2014) explains that the more easily a consumer recalls a specific brand, the greater chances there is that the customer may buy that brand. Brand recognition is
when the consumer can verify a previous exposure to the special brand when the brand is given a cue (Keller, 1993). Focault and Sceufele (2002) found brand awareness to be positively connected to previous purchase online and intended purchase online. More specifically Focault and Scheufele (2002) found that the more sites selling textbooks a student could name, the higher likeliness of that student to have purchased textbook online and the future intent of purchasing textbooks online. According to Yen (2014), uncertainty that appear while purchasing online can be reduced by a well-known brand since it indicates positive associations and quality. Hsu et al. (2007) describes that the brand name becomes more important when a buyer is uncertain of what product to purchase. The more knowledge a consumer has about a brand, the more likely it is for them to make a purchase (Hsu et al., 2007). Also Zo and Ramamurthy (2009) tells about consumers decision process, and that brand awareness could be a dominant factor other than the price. Since the online stores always are available, and the entry barriers are low, consumers can easily switch between different online stores (Zo and Ramamurthy, 2009). At the same time, consumers will get influenced by commercials, word of mouth and other people in their surroundings (Woods and Hayes, 2012). The consumers brand awareness will then be a mix of own personal experiences, based on collected information and previous experience of online purchases, but it will also be influenced by external factors (Zo and Ramamurthy, 2009). Furthermore Dew and Kwon (2010) tells that just because a consumer is being exposed to the brand and receives brand awareness it does not mean that the consumer develop favorable brand associations. It takes direct and indirect experiences for the consumer to get favorable brand awareness. McCole et al. (2010) explains that the increasing usage of Internet and online shopping by consumers over the years has resulted in a higher amount of brand awareness online. Arce-Urriza and Cebollade (2012) explains that if a consumer has previous negative experience from purchases it can result in consumers preferring a fewer but stronger and well-known brand when purchasing online. However, the level of brand awareness from the consumers is changing depending on what kind of products that is considered, this can be caused by the amount of available information about the product on the website (Arce-Urriza and Cebollade, 2012) .
2.7 Hypotheses and research model
2.7.1 Hypotheses
In order to reach an answer to the purpose, hypotheses deriving from theory were created. Hypotheses were created because of its possibility to create clear and logical argument for the relations between concepts and also position the relationship to theories (Sparrowe and Mayer, 2011).
Perceived risk was found to be at a higher level when shopping online compared to offline stores and was stated to have an affect on consumers purchase intentions. It was also argued to be an outcome of uncertainty when sharing personal information and which creates a negative connection with the online buying behavior, the risk could possibly interrupt a purchase hence the first hypothesis, that perceived risk has a negative influence on students buying behavior online, was proposed.
H1 Perceived risk has a negative influence on student buying behavior online
Price was a factor stated to be important and highly valued which could be a determinant factor of a consumer buying decision. Online shopping could be a result of the willingness of the consumer to find ways to reduce costs and save money and hence the second hypothesis, that price has a positive effect students buying behavior online, was proposed.
H2 Price has a positive influence on student buying behavior online
Convenience was stated to be a dominant factor for consumers to purchase online instead of offline stores, due to the easiness for comparing price and saving time spent,.
It could be a factor that decreases the risk for the consumer and is stated to be of importance for Internet shoppers. An easy and quick shopping method could increase the possibility of a purchase hence hypothesis three, convenience has a positive influence on student buying behavior online, was proposed.
H3 Convenience has a positive influence on student buying behavior online
Social influences could affect a consumer's buying decision by attitudes or judgments and the consumer social lives such as friends and family could affect the buying
H1- H2+
H3+
H4+
H5+
behavior. Because of its affecting nature social influences was proposed in hypothesis four to have an positive influence on student buying behavior online.
H4 Social influences have a positive influence on student buying behavior online.
Brand awareness was stated to occur when a consumer was familiar with a brand and could recall and recognize the brand, the awareness have effect on consumer buying behavior. Brand awareness was found to be positively connected with previous buying behavior online and the intent to continue to purchase online hence the fifth hypothesis, that brand awareness of more than one online textbook retailer has a positive influence on student buying behavior, was proposed.
H5 The brand awareness of more than one online textbook retailer has a positive influence on student buying behavior
2.7.2 Research model
The model showed the relationship between the variables proposed in the hypotheses (see Model 1).
Model 1 – Research model
Perceived risk Price
Convenience
Social influence
Brand awareness
Student buying behavior
3 Method
This chapter describes the methods chosen for the thesis in order to collect and analyze the data correctly. It presents different method choices made and includes justifications, the chapter ends with a description of how to ensure the quality of the thesis.
3.1 Research approach
The first choice made was to decide whether the study should have a deductive approach or an inductive approach. A deductive approach was chosen since the study used existing theories to see if these theories were applicable to specific cases (Hyde, 2000). These theories created hypotheses to test for the research (Bryman and Bell, 2005). An inductive approach was not a possible since it uses theory as the outcome of the research (Bryman and Bell, 2007).
A quantitative approach was considered most suitable to reach the purpose since there was a need to make statistical inferences of the results (Bryman and Bell, 2007). A quantitative research collects numerical data that could be explained as the relationship between theory and research from a deductive approach (Bryman and Bell, 2005). This thesis, which had a deductive approach, could be both quantitative and qualitative and since the meaning of the thesis was to be able to generalize among the population, the choice of method was quantitative. This thesis also did not want to search for underlying reasons for attitudes and beliefs which a qualitative study does, but to search for differences among a larger group of respondents (Bryman and Bell, 2007) which also motivated a quantitative approach.
3.2 Research design
When choosing research design there must be a good fit between the design and what type of research to be conducted (Zikmund et al., 2010; Bryman and Bell, 2005). A descriptive research design was chosen for the current thesis due to its possibilities to answer questions of who, what, when, where and how (Zikmund et al., 2010), which was essential for answering the hypotheses. It is commonly used as a design when conducting a survey (Burns and Bush, 2003) and fits researches that have limited time
and means (Yin, 2009). An exploratory design was not used since the purpose was not to get a broader understanding of a problem, but to make statistical inferences (Saunders et al., 2009). Casual design was also rejected do to its nature of examining if a variable causes or determines the value of another variable (Bryman and Bell, 2007) by focusing on a specific situation or problem (Saunders et al., 2009).
3.3 Data collection
Empirical data is generally divided into two different types of data; primary and secondary data (Svenning, 2003). Primary data is new data that has been collected by the researchers themselves for a specific purpose (Bryman and Bell, 2007). Secondary data is old material that has been collected by other researchers in previous studies; this may be found in articles, academic publications, newspapers etc. (Jacobsen, 2002;
Svenning, 2003). To obtain up-to-date information and collect data for the specific purpose of this study, primary data was chosen.
As the source of gathering primary data, survey was chosen as the research strategy method, this because it was the best fit for a quantitative study whereas the research aimed to make statistical inferences with a deductive approach (Saunders et al., 2009).
It can answer questions of who, what, where, how many and how much (Yin, 2009) and the results can be analyzed to make statistical conclusions of a population (Saunders et al., 2009).
3.4 Population and sample selection
According to Bryman and Bell (2011) a population must be chosen for a research, the population includes all of the units from which the sample can be collected. The population chosen for the study was University students in Sweden. There are two techniques to use when selecting a sample within the population for a research, probability sampling and non-probability sampling (Saunders et al., 2009). Non- probability sampling can predict the probability of a respondent to be chosen where each sample has equally chance of being collected in a probability sample thus probability sample was the choice of sampling due to the fact that all of the prospective could answer the questions. Since there was a lack of a clear sampling strategy due to
time limitations, convenience sampling was made to get a easy access to the respondents (Ritchie et al., 2003).
Since survey was chosen as data collection method the decision between a sample survey and census survey was made. A sample survey was chosen as the best fit since it investigates a sample of the population to be able to draw conclusion of the whole population in contradiction to census survey which actually investigates every possible case or group of the population (Saunders et al., 2009). Since the study was conducted within a limited amount of time with a limited amount of resources, sample survey was the best choice. The population was decided to be University students in Sweden, a sample of this could be reached through the Internet, via Facebook by the researchers.
The criteria for selecting respondents was based on three preconditions, that the respondent currently was a university student, the student must have been studying for more than one year and have at least one semester left to study.
3.5 Preparatory data collection
Before the questionnaire was constructed, a focus group was conducted in order to find relevant theories for the target group, students. The purpose was to collect information to compare with the literature to be able to choose the most relevant concepts and test their impact on the consumer buying behavior online. Because previous studied had focused on different types of influential factors, the authors wanted to ensure that the most relevant factors, theories and concepts was covered, therefore a focus group was appropriate to conduct. A focus group can reveal how the respondents feel and think about a certain subject and thereby find important information (Bryman and Bell, 2005).
Moreover, a focus group is of a qualitative nature and was conducted before deciding the hypotheses. The focus group consisted of six respondents; all of them was current University students with previous experience from purchasing textbooks online. The respondents was asked to mention what they believe affects them during an online purchase, what factors that could affect their buying decision and what factors they consider as important. The respondents discussed and concluded that especially four factors was of great importance, and the theories of; perceived risk, price, convenience and brand awareness was derived. Theories from existing literature; consumer buying behavior and social influence were added to the research subsequently.
3.6 Operationalization, measurements of variables and questionnaire
3.6.1 Operationalization
The questionnaire was based upon the conceptual framework and the questions was divided into five constructions; students buying behavior online, perceived risk, price, convenience, social influence and brand awareness. Transforming the theoretical concepts to questions and thereby making a concept measurable can be done by doing a operationalization (Eliasson, 2010; Patel and Davidson, 2011). The operationalization for the questionnaire can be seen in Table 2 where the conceptual definition, operational definition, measures and number of items is presented. The conceptual definition represents the definition found in the literature and clarifies the concept. The operational definition explains how the concept is measured for the thesis and “measures” show the concepts broken down into smaller pieces.
Table 2 - Operationalization
Concept Conceptual Definition Operational Definition Measure
Students buying behavior
How the consumer acts regarding purchases (online) (Armstrong et al., 2009; Focault and Scheufele, 2002)
The consumers beliefs about their buying behavior online
Plan Intent Likelihood Perceived risk The outcome of uncertainty during a process
(Zimmer et al., 2010; Chang and Tseng, 2013)
The consumers’ beliefs about the risk included in purchasing online.
Safety Risk Uncertainty Price A value that allows consumers to purchase a
product (Delafrooz et al., 2010; Malik and Gupta, 2013)
The consumers’ beliefs of how price affects their choices online.
Discounts Best price Special offers Convenience Reduction in the amount or consumer time
(Mazaheri et al., 2010) and/or energy required to acquire, use, and dispose or a product or service relative to the time and energy required by other offerings in the product/service class” (Brown and McEnally, 1992).
The consumers’ beliefs of how convenience affects their online shopping behavior.
Effectiveness Control Time Fit
Social influence Refers to the modification of an individual's responses in reaction to the actions of another”
(Kuan et al., 2014, p.152) like judgment and attitudes (Wood and Hayes, 2012)
The consumers’ beliefs of how others influence their choice of online purchase.
Influences Complying Beliefs
Brand awareness The familiarity (Yen, 2014) and favorable brand association the customer holds in memory
How aware the consumers are regarding alternatives to
Existing knowledge
(Keller, 1993). purchase from online.
3.6.2 Measurements
Within the survey method researchers can choose between interviews and questionnaire to collect the primary data (Bryman and Bell, 2011). Questionnaire was chosen as the best fit of data collection method since this quantitative data collection tool could be predesigned, could reach a large number of respondents, had no need of an interviewer and was therefore easier to administrate (Bryman and Bell, 2011).
The measurements used to test the research hypotheses can be found in Table 3, the items were either adapted or adopted from previous related studies. The measurements for each concept combined with demographic measurements created the questionnaire.
Awareness was measured through a free response question that asked the respondent to write down web pages that sells new and used textbooks and was adapted from a similar study of Focault and Scheufele (2002).
Table 3 - Measurements
Constructs Sources Indicators
Student buying decision
Measure adopted from:
Foucault and Scheufele (2002): 1.1 Bianchi and Andrews (2012): 1.1, 1.2 Andrews and Bianchi (2013): 1.1, 1.2, 1.3
1.1 I plan to purchase textbooks online in the future 1.2 I intend to buy my textbooks online in the future
1.3 It is likely that I will use the Internet to buy textbooks online in the future
Perceived risk Measure adopted from:
Andrews and Bianchi (2013): 2.1, 2.2, 2.4
Bianchi and Andrews (2012): 2.3
2.1 I feel safe making purchases on the internet using my credit card 2.2 I feel safe giving my personal details to an online organization if requested
2.3 Compared with other ways of making purchases, I think that using the internet is more risky
2.4 There is too much uncertainty associated with using the internet to make purchases
Price Measure adapted from:
McKechnie et al. (2012) 3.1, 3.3, 3.4 Luo and Chung (2010) 3.2
3.1 I buy textbooks online on the webpage that I know have good discounts
3.2 I buy my textbooks on the webpage which offers the cheapest book 3.3 The chance is higher that I buy textbooks on a webpage where there is student discounts.
3.4 The chance is higher that I buy textbooks on a webpage where there are special offers for students.
Convenience Measure adapted from:
Andrews and Bianchi (2013): 4.1, 4.2, 4.3, 4.4
Bianchi and Andrews (2012): 4.4
(Malik and Guptha, 2013) 4.5
4.1 I believe using the Internet enhances my effectiveness in making purchases
4.2 Shopping is more convenient using the Internet to make purchases 4.3 Using the Internet to make purchases gives me greater control over my shopping time
4.4 Using the Internet to make purchases fits well with the way I like to shop.
4.5 I compare the price of textbooks online via price comparison sites to find the best option
Social influences
Measure adapted from: Andrews and Bianchi (2013)
5.1 I believe my friends/classmates influences me positively regarding purchasing of textbooks online.
5.2 I am motivated to follow my friends/classmates influences regarding purchasing of textbooks online (e.g. if they buy their books online, so will I).
5.3 People that I speak to via social media influences me positively to purchase textbooks online (e.g. if someone post a hint about a cheap book online).
Brand awareness
Measure adapted from: Focault and Scheufele (2002)
6.1 Write down as many webpages as you can think of that sells new and/or used books online, think carefully before transmitting the answers.
3.6.3 Questionnaire
The questionnaire (See Appendix A for English version and Appendix B for the Swedish version) allowed the researchers to gather information from the respondents regarding their buying behavior online. The main part of the questions was chosen to be closed since was more convenient for the analyze of the results, this because it can display the relationship between variables (Bryman and Bell, 2011) and open questions are a better fit for a qualitative analysis (Saunders et al., 2009). The closed questions was measured by seven point Likert´s scale which is measured by asking a respondent how much he or she agree/disagree with a statement in a degree of one to seven point rating scale. The questionnaire was sent out via Internet, more specifically, via Facebook, to the respondent group. The authors could not ensure that the questionnaire only reached the intended respondents because the questionnaire was open to everyone, therefore the questionnaire started off with three questions to make sure the respondents was appropriate for the study. The questionnaire was carried out through Google Drive which has a free system where it is possible to extract the answers to an excel file to
ease the import into SPSS. The questions was translated into Swedish since it is the native language of the respondent group, to assure the questions remained the same, the questions was translated back into English by a English/Swedish speaking person to assure the translation was correct. The questionnaire was open for three days and reminders to the respondent were sent out every day due to time limitations for the study.
A pre-test was conducted before the questionnaire was sent out to find if the items were properly developed to be used for the research and to reveal any problems regarding the understanding of the questions, it was also used to find if there was any problems recording the data (Saunders et al., 2009). Six University students and two professors tested the questionnaire to find if there was any uncertainties, minor adjustments was made due to the respondents and professors comments before the questionnaire was sent out.
The items of the questionnaire started off with three control questions to ensure the respondent belonged to the population chosen followed by a question of their previous buying behavior online regarding textbooks the latest academic year. Next demographical questions was asked continuing with the scale questions to measure the concepts and ended with the open question for awareness. Control variables was also included since a regression analysis was to be conducted, the control variable was previous experience with online shopping (see questionnaire in Appendix A and B)
3.7 Research quality
To confirm the strength and trustworthiness of a study (Yin, 2009) and to achieve a study with high quality, reliability and validity needs to be measured (Bryman and Bell, 2011; Aaker et al., 2011).
3.7.1 Reliability
Reliability is measured to assure future researchers possibility to imitate the procedure under the same condition with the same subjects (Ilyoo and Hwihyung, 2011) obtaining the same results (Andersen, 1998). Reliability is important to achieve to reach a level of stability in the research which makes the research reliable over time (Bryman and Bell,
2011). The first part of ensuring reliability was by conducting a pre-focus group to find relevant theories for the study from the respondents view together with a literature review. The results from the pre-focus group together with existing literature built the foundation for the literature review. Later the reliability of the items was measured in SPSS with reliability coefficients named Cronbach´s alpha (Ilyoo and Hwihyung, 2011), which should be above 0.7 to ensure the reliability (Bryman and Bell, 2011).
Other actions was taken to ensure reliability by using scientific literature for the theoretical framework and by pre-testing the items measuring the concepts.
3.7.2 Validity
Validity controls if the constructs measure what it is intended to measure (Bryman and Bell, 2011). To ensure content validity professors and respondents from the sample pre- tested the questionnaire to confirm that the variables used was selected and described correctly and thereby confirmed that the items measures was valid (Bryman and Bell, 2011).
The validity of the constructs can be ensured by conducting a correlation analysis to confirm that the measures do not have too strong correlation and thereby measuring the same concept, this can be verified if the correlation is above 0.75 (Zikmund et al. 2010) but not higher than 0.90 (Katz, 2006). Furthermore with a correlation between 0.75 and 0.90 the measure represent a unique concept and also determines if there is a correlation between the concepts (Zikmund et al. 2010). It is also ensured by managing a proper operationalization to make sure the constructs measure what is relevant for theories and use, or be inspired by, questions used in previous scientific articles (Bryman and Bell, 2011). In the current research theories was evaluated and concepts was operationalized into measurements, most of the questions was inspired by existing scientific articles.
The collected data was analyzed in the statistical software SPSS by conducting descriptive statistics, correlation analysis, reliability analysis and regression analysis test which was further explained in the analysis and results chapter.
4 Analysis and results
4.1 Analysis procedure
The collected data was analyzed in SPSS in order to find statistically significant results for the thesis. The data was first transformed from Google docs into Excel to be able to sort and number the data correctly. Answers that did not fit the criteria for the thesis was excluded and the remaining answers were used for the analysis. To be able to test the data some answers were coded into numbers, for example was “Sex” numbered into “1”
for Woman and “2” for Man. After the sortation and coding the numbers where entered in SPSS to be further processed. A factor analysis was conducted to reduce the amount of variable used for a concept into a smaller set of items (Pallant, 2010) and to make sure no single factor or any general factor accounted for most of the variances in the independent and dependent variables (Howitt and Cramer, 2005). A reliability test and correlation analysis was then made to ensure the reliability of the concepts and their uniqueness (Zikmund et al. 2010). The hypotheses was tested through a multiple simple regression analysis to see if and how the independent variables affected the dependent variable (Saunders et al. 2009), and if its significance could support or reject the stated hypotheses (Nolan and Heinzen, 2008). Furthermore in the regression analysis control variables was included to control that the independent concepts had a statistical impact on the dependent concept.
4.2 Frequencies
The questionnaires were answered by 211 respondents were 30 answers had to be excluded due to the criteria regarding the respondents’ pre-situation (must currently be a student, have studied for more than one year and have at least one semester left). This resulted in an ending amount of respondents at 181, where 54 percent was female and 46 percent male (see Table 4). The age of the respondents ranged from 20 years old to 30 years old which concluded that all of the respondents belonged to the younger generation The majority had been studying for two or three years (72 percent) which was positive for the study since the majority therefore was assumed to have at least one semester left. 88 percent had bought at least one book online the last academic year.
In the tables presented below in this chapter (Table 5-X) the concepts are coded into;
student buying behavior (SBB), perceived risk (RISK), price (P), convenience (CONV), social influence (SOC) and brand awareness (AW). Before performing the tests in SPSS
the concepts, with their items, was evaluated in SPSS Factor analysis, the test indicated no need for excluding any item. This process also concluded that no single factor or any general factor accounted for most of the variances in the independent and dependent variables (Howitt and Cramer, 2005). The questionnaire had two negatively worded items among the positive, to check and reduce the common method bias variance the negative worded items was re-coded in SPSS to create symmetry among the concepts.
Table 4 - Frequencies
Frequency Percent
Gender Female Male Total
98 83 181
54 % 46 % 100 % Education year
2 3 4 5 Total
55 76 39 11 181
30 % 42 % 22 % 6 % 100 % Purchase behavior last academic year
All of my textbooks online Most of my textbooks Half of my textbooks online
A small number of my textbooks online I did not purchase any of my textbooks online
Total
35 54 31 40 22 181
19 % 30 % 17 % 22 % 12 % 100 %
4.3 Reliability analysis
Cronbach´s alpha (see Table 5) was calculated for the concepts; student buying behavior, perceived risk, price, convenience and social influence to measure the reliability of the research. Cronbach´s alpha was calculated for a total score of the concepts at 0.907 which concludes that the study is reliable due to the number being above 0.7. Cronbach´s alpha was also calculated for each concept where all of the concepts measured above 0.7. Despite of this, one item was removed from
“convenience” due to its large improvement of the Cronbachs alpha, item number five
“I compare the price of textbooks online via price comparison sites to find the best option” was removed to purify the scale and left four items remaining. Items represented how many questions/statements that were used to investigate each variable.
Since the Cronbach´s alpha was high it concluded that the variables were reliable.
Table 5 – Reliability analysis
Concept Cronbach´s alpha Items
SBB 0,971 3
RISK 0,776 4
P 0,872 4
CONV 0,849 4
SOC 0,850 3
Total 0,907 17
4.4 Correlation analysis and descriptive statistics
The correlation analysis (see Table 6) revealed no correlation above 0.75 which confirmed construct validity. The correlation between perceived risk and price, and perceived risk and social influences was weak with a score of <30, the other correlation was at a moderate level >30<70 and none of the correlations was strong >0.70. All of the concepts were significant at a level of 0.01 and had a positive relationship which confirmed the measurements to represent a unique concept which correlated with the other concepts.
The descriptive statistics was represented by standard deviation and mean. Mean is the middle value of the data and is not affected by extreme values, standard deviation (SD) is the extent to which values differ from the mean (Saunders et al., 2009). The mean did not vary much among the concepts, except from “social influences” which had a lower mean than the other concepts, indicating social influences to not affect students buying behavior as much as the other concepts (see Table 6).
Table 6 – Correlation analysis and descriptive statistics
Mean SD (standard deviation)
SBB RISK P CONV SO
C
SBB 5.082 1.899 1
RISK 5.057 1.280 0,332* 1
P 5.325 1.599 0,479* 0,243* 1
CONV 5.277 1.348 0,573* 0,383* 0,542* 1
SOC 3.77 1.728 0,398* 0,253* 0,457* 0,412* 1
