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MBA Company Project

For

Identifying Online Shopping Drivers Using Technology

Acceptance Model

Author:

Dhruv Aggarwal

Student Number:

11878266

Email:

Dhruv.aggarwal@student.uva.nl

Submission Date:

15

th

August 2018

Supervisor:

Dr. Ruben de Bliek

Amsterdam Business School, Full Time MBA, 2017-18

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Statement of Originality

This document is written by Dhruv Aggarwal, who declares to take full responsibility for the contents of this document.

I declare that the text and the work presented in this document are original and that no sources other than those mentioned in the text and its references have been used in creating it.

The Faculty of Economics and Business is responsible solely for the supervision of completion of the work, not for the contents

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Abstract

In the digital age, having a strong online presence is of vital importance for any company. As a part of the Digital Plan 2020, VodafoneZiggo wants its website and mobile application to be its primary channel for customer interaction and transactions. Achieving this is a challenging task as it demands a radical change in the shopping behavior of the consumers to shift from retail to online channels.

The purpose of this study is to investigate the barriers and drivers for the acceptance of Vodafone online channels and give recommendations to the company which when implemented can result in a boost of sales through online channels.

Technology Acceptance Model (TAM) serves as the foundation of research framework. TAM has been extensively used to understand the factors influencing the acceptance of a new technology. For this study, literature review has been done of studies which use TAM in a similar context. The findings of these studies relevant to the case in question are identified. Multiple market reports on online consumer behavior are studied to understand the barriers and motivators of online shopping.

All the studies validated that perceived ease of use and perceived usefulness have a significant influence over consumers’ behavioral intention to buy online. Majority of the studies also proved that perceived risk had a negative influence on the consumers’ intention to buy online.

A sample questionnaire is created which can be used by the company to validate the findings. In this study, potential antecedent for perceived ease of use was identified to be website quality, and service quality was identified as an antecedent for perceived usefulness.

It was concluded that in order to be successful in online commerce, it is important for

VodafoneZiggo to expedite and improve its delivery mechanism and for this an Omni-channel delivery approach utilizing the retail footprint is recommended. To reduce the risk of the customer while buying online, it was recommended to include best price guarantee and online only offers. Lastly, to improve the website design, elements such as comparison, customer reviews and automated support must be included.

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Contents

I. Introduction ... 6

A. About the Company ... 6

B. Problem ... 12

II. Research design ... 12

III. Dutch E-commerce market ... 14

IV. Literature Review ... 17

A. Impact of online channels on businesses ... 17

B. Impact of online channels on consumers ... 18

C. Technology Acceptance Model ... 19

D. Perceived Risk Theories ... 23

E. Effect of age on acceptance of technology ... 24

V. Market reports ... 25

A. KPMG - The truth about online consumers. ... 25

B. Ripen - Why 92% of Retail Purchases Still Happen Offline ... 29

VI. Application of Framework... 30

A. Research Framework ... 31

B. Use of Technology Acceptance Model ... 31

C. Relevance of TAM for this study ... 33

D. Use of Survey Questionnaire ... 33

E. Potential Antecedents ... 34

F. Moderating effects of age on the drivers ... 42

VII. Issues with the services of VodafoneZiggo ... 44

VIII. Recommendations: ... 46

I. Increasing Perceived Usefulness - Enhanced Delivery ... 46

II. Reducing Perceived Risk - Better pricing strategy ... 50

III. Increasing Perceived Ease of Use - Intuitive web design and automated support ... 51

IX. Limitations ... 52

X. References ... 54

XI. Appendix A: ... 57

A. Proposed questionnaire to verify Perceived Ease of Use, Perceived Usefulness and Perceived Risk ... 57

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List of Figures

Figure 1: VodafoneZiggo Purpose, Initiatives and Values. ... 7

Figure 2: Organigram depicting the position of Digital Department in the organization. ... 9

Figure 3: Ambition, Objectives and Strategic Initiatives to be taken by the company to realize the objectives and the ambition ... 11

Figure 4: Internet Penetration and Online Shoppers in Netherlands. ... 14

Figure 5: Number of E-shoppers and Spending... 15

Figure 6: Number of Web shops in Netherlands 2007 – 2016 ... 15

Figure 7: Total market: online & offline, 2017 ... 16

Figure 8: Consumer preferences: Product purchasing ... 17

Figure 9: Theory of Reasoned Action ... 19

Figure 10: Technology Acceptance Model ... 20

Figure 11: Reasons consumers shop online instead of in stores ... 26

Figure 12: Reasons consumers shop in stores instead of online ... 27

Figure 13: Most important attributes when deciding where to buy ... 28

Figure 14: Reasons Consumers shop in stores instead of Online – By generation ... 29

Figure 15: What would make you most likely to purchase an item in-store instead of online? ... 30

Figure 16: Research framework based on technology Acceptance Model ... 31

Figure 17: Obstacles for web sales ... 37

Figure 18: Consumer Behavior: Comparison websites ... 39

Figure 19: What is the most important factor in the design of a website? ... 42

Figure 20: Average number of online transactions and Average amount spent per transaction – By generation ... 43

Figure 21: Type of Online purchase by individuals in the Netherlands, 2016 ... 44

Figure 22: Delivery Factors - Importance of delivery factors when shopping online ... 46

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Abbreviations and Terms Used

Abbreviations

TAM – Technology Acceptance Model PEOU – Perceived Ease of Use

PU – Perceived Usefulness VR – Virtual Reality VZ - VodafoneZiggo

Terms

Baby Boomers - Born between 1946 – 1965 Generation X - Born between 1966 – 1981 Millennials - Born between 1982 – 2001

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I.

Introduction

With 5.2 Million subscribers, Vodafone is the second largest mobile operator in The Netherlands and with 3.9 Million customers, Ziggo is the largest cable operator in the Netherlands. On 31 December 2016, Vodafone and Liberty Global entered into a 50/50 Merger to create a separate entity called VodafoneZiggo. This combined Ziggo’s rich fiber optic network with Vodafone’s strong Mobile operations and thus created the largest mobile and fixed line operator company in The Netherlands.

As a part of their Goal of creating a digital future, the company wants to digitalize their sales, operations as well as the customer experience. Today, customers view products online, do the research and eventually buy it offline. For Vodafone, about 85% of the sales are through retail outlets and tele channels. This is not a healthy percentage for a company which aims at going completely digital by 2020. Thus, they want to focus on conversion of their sales and marketing channels from offline and analog to digital channels.

Vodafone has experience and insights on what works for them and what not. This combined with market research on the best practices in digital area would be instrumental in driving this change. In this research, different factors which affect the buying behavior of the consumer will be assessed and recommendations would be provided for boosting the online sales. Technology Acceptance Model (Davis et. al., 1989) will be used as the foundation of the research and the potential factors influencing the perceptions of the consumers will be identified.

Technology Acceptance model is a widely used theory to predict the factors that affect the behavior of the user when he is presented with a new technology. Previous research on acceptance of online channels have successfully validated the TAM and have identified the drivers relevant to that context. In this study, by using TAM, we will use the conclusions from existing research to understand the consumer’s perceptions towards Vodafone website and mobile application and identify the factors which influence the perceptions.

A.

About the Company

VodafoneZiggo is among the most popular and socially active companies in the Netherlands. It provides Broadband internet, television, fixed line telephony and mobile telecom services to both individuals as well as businesses the Netherlands. Vodafone Ziggo B.V. was created as result of a

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7 50 50 joint venture between Liberty Global and Vodafone in December 2016. Liberty global merged its Dutch operations with Vodafone Netherlands. Liberty global is the largest internet TV and broadband company in the world and Vodafone is one of the biggest telecommunications companies in the world. The newly formed entity now owns 53% of the Dutch market thus making the largest fixed line and mobile network company in the Netherlands. Currently the company is under the process of unification and integration of both the companies and plans to completely work as a single entity in the next few years.

Figure 1: VodafoneZiggo Purpose, Initiatives and Values.

Source: VodafoneZiggo internal communication.

Retrieved from VodafoneZiggo employee portal on May 10, 2018

Purpose: The newly formed company has very clear purpose, they want to make every

interaction with the customer, enjoyable. Enjoyable for the customer as well as the business. Every time the customer interacts with VodafoneZiggo, be it through retail stores, website or customer care, the customer should be satisfied and happier than before. To do this they want to make the interactions easier and simpler and ensure that they leave a positive effect on the

customer. While doing so they also want to ensure that every customer touchpoint, the employees also feel happy, satisfied and motivated to deliver. This can be done by proper training,

compensation and making the workplace a fun place. Another aspect of the purpose is progress. Progress refers to growth of the company. Company wants to learn from every interaction at every touch point and learn from it, improve it and try to turn it so that it benefits both the company and the customer. The company does not want to grow only financially but also technologically and morally. To do this the company has set four strategic Initiatives which are discussed below.

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Strategic Initiatives: To achieve the above-mentioned purpose, VodafoneZiggo has laid down

four strategic objectives. These objectives act as strategic guidelines to shape the future strategy of the company. One of the objectives is investing in the future, this is an important objective as these days most of the industries are undergoing disruption, especially consumer industries. Thus, the company wants to keep investing in the future with an intention to shield itself from future disruption. VodafoneZiggo believes that Digital would be the center of innovation and in the future will be the baseline of all the other initiatives hence wants to direct a lot of its efforts in the digital and tech area.

Values: The Company’s values are about its culture and how it wants to be as a company. The

company’s values are reflected in its interaction with the customers, the internal strategies, and the way day to day operations are carried out. The company has always strived to be a better and a happier workplace and wants its employees to stay satisfied with their workplace. The company believes employee satisfaction can be achieved by constant learning and development of the employees.

The company lives by the following three values: Through Open Up it wants its employees to be honest and positive. Be open to new situations, responsibilities and contacts. They believe in sharing the thoughts and learning from each other. Team Up refers to its focus on collaboration and team building. They want a culture where everybody appreciates the differences and trusts each other. And lastly they want everyone in the company to Step Up and get out of the comfort zone. To set the bar high and dare to take new challenges and more responsibilities. The company wants everyone to go for the quality and not hold back while walking an extra mile for the

customer.

The company regularly takes a number of initiatives to ensure that these values are lived by everyone. This can be seen in company's day to day work culture, which is very open

collaborative and supportive. Apart from that the company also organizes a number of events such as D-Buzz sessions, upwego event where employees can come up with new ideas, share their issues and also have fun.

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1.

VodafoneZiggo Digital

The organizational structure of Vodafone Ziggo is split into Nine Business units. These units are divided based on their relevance to the business and the kind of the role they perform in the operations of the company. Digital department for VodafoneZiggo is situated in the Business to Consumer (B2C) unit. The business to consumer unit handles all the processes, products and services related to the consumer. This includes for example, planning, marketing, sales and communications. The role of digital department is to handle the online sales and service channels. This includes sales, services and support through the company website and the mobile app. The below organigram shows the position of Digital Department in VodafoneZiggo.

Figure 2: Organigram depicting the position of Digital Department in the organization.

Source: VodafoneZiggo Internal

2.

Digital Plan 2020 - Investing for the future

With the pressure of integrating the operations of Both Vodafone and Ziggo without creating a turbulence in the customer experience, Digital department is undergoing a transition in which every existing system is under discussion. In the coming years, Digital will play a significant role in catering majority of the customer requests. Customers will consider digital to be a primary channel of Vodafone Ziggo, because the digital channel will be customized differently for each individual based on the collected data and preferences.

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10 Currently the backend and customer interaction touch points are separate for Vodafone and Ziggo. This leads to replication of data and for the customer two separate brand interactions. Company wants to unify both the brands and cross sell the products. This will lead to better use of collected data and as a result enhanced customer experience. Thus, VodafoneZiggo has set the ambitious objective of keeping customers happy by providing seamless experience i.e. integrating the two brands into one, excellent services, and keeping employees happy by being a good

employer.

Vision - Digital as the primary portal for customers and the organization

The Digital department will play a prominent role as the most effective and most sustainable channel for customer contact. Thus, ensuring high customer satisfaction and customer loyalty. Research into customer behavior does not end when the customer leaves the website, and there will be a shift towards an experience geared to the customer, which will be achieved in

cooperation with other departments and external partners.

In the role as connector and driver, it is important to break the internal departmental hierarchy and work collectively as a single department to remove the obstacles in all customer-oriented processes by jointly building digital processes and applications. For example, the retail, tele sales and digital departments come together to provide an integrated and Omni channel experience to the customer.

Keeping these highlights as the base of discussion, the digital plan 2020 has been created with the following Goals:

● Increase in digital applications and products within the business as part of ‘Digital First’ and ‘Digital Telco’. Which emphasizes on creating all the internal process online. ● Develop customer-focused digital propositions that are a useful addition for the target

group. In other words, customer centricity to be the core of all future initiatives. ● Strive for a chain approach. This means to follow customers throughout their purchase

journey, across all channels and departments, so that solutions can be offered based on the problems that customers experience. For VodafoneZiggo, an example of a customer journey could be a customer searching for best telecom plan, visiting Vodafone website,

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11 selecting the appropriate device and plan, proceeding to checkout, Payment, signing the contract and then receiving the product.

Figure 3: Ambition, Objectives and Strategic Initiatives to be taken by the company to realize the objectives and the ambition

Source: VodafoneZiggo Internal

Ambition: The above image shows the initiatives that will lead to the successful achievement of

the goals. The goals have been consolidated as one Ambition statement which focuses on increasing the digital footprint and create experiences which surpass the needs of the customers. The company’s ambition is to incorporate digital services such as business intelligence in all the areas of the business and to conduct more business online. They want to create an innovative and customer centric environment in the company where employees can learn and grow and create new digital solutions for the customers.

Objectives: To achieve this ambition, three key objectives have been laid out. The first objective

is about providing a converged and a seamless digital experience to the customer. For this the company is taking multiple initiatives to create a system where they can consolidate the information of the customer and thus create a personalized experience for them. The second objective is about the sustainable growth of digital domain. To ensure a sustainable growth, adoption of digital channels is crucial. This is where company is going to invest by creating a

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12 digital product portfolio, better value for the customer and matching marketing strategy. To boost innovation and boost the adoption of digital channels, they invite fresh ideas and will set up a Centre of Excellence. To achieve the third objective, the company will work on creating an innovative culture, establish a digital workplace and hire the best and motivated talent with equal affinity to these digital initiatives.

B.

Problem

The focus of my internship at VodafoneZiggo is around the second objective i.e. achieving a sustainable and lasting growth from Digital Domain. For this the company wants to create a portfolio of digital products and services. This digital strategy should be focused on boosting the adoption of digital channels by the customers i.e. Website and Mobile Application. For

VodafoneZiggo's digital plan to be successful, it needs more and more customers to move to the above-mentioned online platforms. Digital transactions and interactions with the customer are of great value to the company. When a customer is served digitally, the company has a lot of benefits such as getting more data from the customer, ability to follow the entire customer journey, ability to follow the customer even after the purchase is made to stay with the customer indefinitely and last but not the least, it is much cheaper to serve a customer digitally.

Prior to the merger, both Vodafone and Ziggo have had some success in this but with the developments happening in the digital landscape, the pace is not enough. So, my role will be to find ways to create a step change in shifting the channel mix towards digital and reducing the reliance over retail and tele channels. To do so, I would like to combine the learnings at the company, available insights, industry best practices and academic literature towards the acceptance of technology by the consumer and identify the drivers affecting the adoption of Websites and Mobile application as primary way of interaction. Based on the existing studies, I will also try to identify how the factors affecting the acceptance of digital technologies play differently for different age groups and how the strategy can be shaped for different customer segments based on age.

II. Research design

The goal of this research is find a solution to a management dilemma by framing it conceptually and exploring it systematically. This research will be done by working closely with the

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13 problem will be framed in the form of the research question. The scope of the research is defined in a way that the goal can be achieved in the limited time frame. The academic literature on the topic is integrated with the framework and applied to the context of the business problem.

For the internal analysis, employees from departments were asked to share insights and provide relevant data. In addition to that several events organized by Digital department were attended to understand the vision, and the problems in the department.

Desk research was conducted to understand where the company is doing right and where the company is lacking. For this, Insights were collected from employees from different positions, multiple internal reports were studied and data from various sources was analyzed.

To understand the behavior of the consumer, several independent reports were studied. These reports were mainly based on surveys conducted by different companies across the globe. These reports bring in some very useful insights on the preferences, drivers and barriers for the

consumer to go online.

For this research, Technology Acceptance Model (TAM) is used as the foundation framework to answer the managerial dilemma of driving the sales through websites and mobile applications. These online channels are considered as new technologies and the potential drivers for the acceptance are being identified by using the Technology Acceptance Model. Multiple studies involving the use of Technology acceptance model (Davis et. al., 1989) were studied and conclusions were drawn based on findings and similarities.

Most of the studies using TAM to investigate the drivers for acceptance of a new technology use a survey questionnaire and do an empirical analysis of the collected data. This allows them to validate their hypothesis through Technology Acceptance Model. Due to the time constraints for this study, the survey is not conducted. From the study of the literature, company data and learnings from the market surveys the results of the questionnaire are estimated and recommendations are provided based on that.

A sample questionnaire is created which can be used by the company to create a survey and collect and analyze the responses of the potential as well as existing customers to validate our hypotheses for the Perceived Usefulness, Perceived risk and Perceived Ease of Use.

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III. Dutch E-commerce market

The Dutch Ecommerce is growing steadily every year with a healthy rate. In 2017 the ecommerce turnover increase rate was around 13%. In 2017 Ecommerce turnover has around 22.5Billion Euros. This turnover is expected to increase to around 25 Billion Euros by the end of 2018. Thus, the growth rate being around 11%, which is lower than 2017 but still sufficiently high.

The share of online channel mix is constantly growing for most of the companies where they see more and more sales from online channels such as website or Mobile App as compared to brick and mortar stores. Wijnand Jongen, CEO of Thuiswinkel.org says that this ecommerce growth is mainly because of the two reasons, a) Recovery of the economy and, b) The improvement in the confidence of the consumer in Dutch economy.

Figure 4: Internet Penetration and Online Shoppers in Netherlands.

Source: Statista, 2018; www.ecommercefoundation.org

Netherlands has fairly high percentage of people having access to the internet. It has a population of 17 million and 97% of those have access to the internet. Out of the people with access to internet, 84% are online shoppers which means that out of the total population, around 81% are online shoppers. This is a fairly high ecommerce penetration percentage and thus the opportunity cannot be ignored and must be tapped to its full potential.

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Figure 5: Number of E-shoppers and Spending.

Source: Thuiswinkel Markt Monitor, 2018; www.ecommercefoundation.org

The Dutch market is seeing a rapid increase in the average online spending. This means that the consumer is building more trust in the economy and is more open to buying online. The average spending per online customer has gone up by almost 40%, which was around €1200 in 2016 and has increased to €1700 in 2017. This increase in average spending also signifies the fact that the customer is trusting the online channels and is willing to spend more through these channels.

Figure 6: Number of Web shops in Netherlands 2007 – 2016

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The Dutch ecommerce landscape is evolving rapidly as more and more web shops are coming up. A reason for this increase is the Omni Channel strategy being adapted by a lot of retailers. At the same time there has been a steep decline in the number of physical stores. The worst hit

categories are Audio/Video stores and the Photographic materials. This steep rise in the online stores also shows that the E-Commerce market is growing and its success can also be owed to increased consumer confidence and willingness to buy.

Figure 7: Total market: online & offline, 2017

Source: Thuiswinkel Markt Monitor, 2018| PWC, 2017; www.ecommercefoundation.org

Ecommerce represents 24% of the total market share of the total market. This means that still three quarters of the sales are through offline channels. Dutch market still lags in online sales percentages which is relatively higher in other European countries for example countries like United Kingdom, Germany and France have around 40% as the online market share.

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So Overall, we see that the Dutch Ecommerce market landscape looks healthy and promising. It is projected to be at a steady growth. The consumer confidence and the buying habits are also favoring the online trends.

Figure 8: Consumer preferences: Product purchasing

Source: Statistica | PWC, 2016; www.ecommercefoundation.org

It is evident that consumer electronics is among the hottest category for online purchases. Consumer electronics include all the mobile phones, audio/video equipment, and TV and photography equipment. Thus, for Vodafone, it means clear signs of a growing market. Thus, basis a healthy market condition, growing penetration and favorable consumer trends, it would be a good opportunity for VodafoneZiggo to attain a healthy market share in online telecom market.

IV. Literature Review

A.

Impact of online channels on businesses

A study was conducted to measure the impact of e-Commerce on firms as well as consumers. This study seek answers to three questions i.e. 1) Do online channels increase the overall sales of a firm. 2) Extent to which firms and consumers benefit when an online channel is introduced and, 3) can the EU market be integrated through online channels. (Duch-Brown, Grzybowski,

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18 The results of this study showed that though there is an initial cannibalization of existing sales but due to market expansion the effect is compensated. In other words we can say that by the introduction of online sales channels, overall sales for a firm increase as the products now reach a wider audience. To answer the second question, the study concludes that generally, it’s the customer who captures the larger share of benefits of going online. Nevertheless it is still a win-win situation for the firms. And for the third question, it was seen that the price difference in different EU countries still remained high and thus introduction of ecommerce did not moderate them.

Thus it can be said that mere introduction of e-commerce channels is not a guarantee that it will be very beneficial for the companies as there are added costs to the online channels. The major costs are delivery costs and the IT infrastructure costs. The ecommerce channels not only pose a threat of cannibalizing the existing sales channels but they also bear the pressure of giving a good customer experience. However, if done in a right way and on the right scale, it can boost

company’s sales and can be strategically very beneficial.

A study was conducted to investigate the benefits of E-commerce as perceived by the businesses (Zhang, 2010). Statistical analysis of empirical data based on survey questionnaire was done and results were derived. The top five perceived benefits were 1) Faster time to market, 2) Efficient communication with the customer, 3) Better customer service, 4) Sales increase, 5) better brand Image. This result is in line with some other similar studies conducted all around the world. There were some new factors cheaper promotions, cheaper research etc., however the above five factors were always voted to be the most important.

B.

Impact of online channels on consumers

In a research by Forsythe et al. (2006), a scale to measure the perceived benefits of online shopping as well as the perceived risks associated with it was created. In the study, benefits are divided into two categories:

a. Utilitarian Benefits: Related to practical usability and benefits such as cost savings, convenience.

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19 The study concluded that convenience, ease of shopping and product selection are the most important benefits which account for the larger percentages in total perceived benefits of online shopping. All the above-mentioned benefits are utilitarian benefits i.e. related to practical

usability and benefits. The smaller proportion is related to hedonic benefits i.e. emotional related benefits such as fun and enjoyment. Thus, it can be concluded that the perceived benefits for the consumer looking for utilitarian benefits are more as compared to the one looking for hedonic benefits. The study concluded that the customers primarily make purchases through websites and mobile apps because of the greater convenience. An important point to note is that the highest risk is also perceived by the consumers with high utilitarian shopping values.

C.

Technology Acceptance Model

Technology acceptance Model (TAM) is a way to predict the user behavior while using of a new technology (Davis, 1989). The Technology Acceptance model is derived from Theory of

Reasoned Action (TRA) (Fishbein, Ajzein 1975). According to this theory the behavior of a user is predicted by his intention or attitude to perform that behavior. In other words, it can be said that the intention to perform the behavior precedes the actual behavior of the consumer. This intention comes from expectation of the outcome and stronger the intention, the stronger are the chances that the actual behavior will be performed. Multiple studies have been conducted in several contexts and have found the relation between the behavioral intention and the actual behavior to be positive.

Figure 9: Theory of Reasoned Action

Source: Belief, attitude, intention and behavior: An introduction to theory and research, Fishbein & Ajzein (1975)

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20 The Technology Acceptance Models is built upon these causal relations established by TRA and aims to explain how external variables affect the attitude, intentions and eventually the behavior of the user while accepting a new Technology. This model is important because these days everything is getting digitized very rapidly and there is very less or no historical proof available to speculate the future outcome. So, this Model tries to explain how certain factors might affect the user’s intention to use an offering which eventually leads to actual acceptance of the new offering.

To explain the intention to use a new technology, the model replaces the attitude measures in TRA and adapts two technology measures, a) Perceived Ease of Use (PEOU) and, b) Perceived Usefulness (PU). Perceived ease of use is that how an individual think, the new technology is easy to use. It is the perception of an individual of the ease in using the technology and may or may not be related to the actual ease of use. Perceived usefulness is the degree to which a user perceives the technology to be useful to him.

Figure 10: Technology Acceptance Model

Source: "Perceived usefulness, perceived ease of use, and user acceptance of information technology". Davis et al (1989)

Both the measures of PEOU and PU will be governed by external variables. Multiple research studies have been conducted to identify the driving variables for Perceived Usefulness and Perceived Ease of Use. Each study finds different variables which have impact on PEOU and PU

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21 under different contexts, however some common variables which can be applied to multiple contexts are also identified. Over the years more than 70 variables have been identified as the external drivers to Perceived Ease of Use (PEOU) and Perceived Usefulness (PU) (Yousafzai et al., 2007) The TAM has been extensively analyzed in a meta-analysis by studying history of TAM, consolidating all the previous research and the empirical findings.(Lee, Kozar & Larsen 2003)

1.

Perceived ease of use

a) Website Quality

A study integrated e shopping quality along with other factors into Technology Acceptance Model to understand the acceptance of online shopping (Ha & Stoel, 2009) In this study a survey was conducted for online shopping of apparel products which included four dimensions of quality: Website design, customer service, privacy/security and atmospheric/experiential. The created model revealed that eShopping quality influences the perceptions usefulness, trust and enjoyment. These perceptions further govern the attitude and intention of the consumer towards online shopping.

This study gave important managerial recommendations to the retailers about developing the websites. It outlined that the websites must be designed by not only considering the information and trust needs but also the quality of service and user experience.

The study used a questionnaire and analyzed the responses of the correspondents for the questions on each dimension. The results of this study showed that the variance of first

Dimension I.e. Website Design is the highest (51.5 %) which is greater than all the other three dimensions combined. This shows that website Quality accounts to the largest proportion in perceived E-shopping quality. These results were similar to a number of other e shopping studies conducted earlier in the same context. Existing research suggests that the aspects of website quality can differ for the type of product and services, type of market segment and the type of retailer. (Peterson et. al., 1997)

Product information in an online store is very important and is a major deciding factor for consumer’s loyalty and trust. The information satisfaction of the customer is highly affected by the quality of product and service information provided by the retailer (Park & Kim, 2003)

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22 b) Self-efficacy

Self-Efficacy reflects the extent to which an individual believes that he can engage in a new behavior or in this study’s context, use a new technology. Generally, people are more likely to indulge in a particular behavior more if they are confident that they have the ability to do that effectively. (Bandura, 1997). If seen in an Ecommerce context it means that the customers feel himself as capable enough to search products online, compare them, take a decision and make the purchase and while so, feels confident and comfortable. Internet self-efficacy has been found to be a strong driver for Perceived Ease of Use (PEOU) of internet when seen through the

Technology Acceptance Model context (Eastin, 2002). The perception of self-efficacy has been tested by several other behavior models such as Theory of Planned Behavior (Schifter & Ajzen, 1985)

2.

Perceived usefulness

a) Time and Effort saving

One of the most important perceptions of online shopping is the convenience. Online shopping is perceived to be convenient by the shoppers as it gives them the flexibility to shop around the clock. This also saves them from dedicating their valuable time in making a buying trip to the retail store. This not only saves them time but also a lot of effort involved in making a trip to the local mall, parking the car and having a meal.

When a person shops online, it takes lesser time, effort and results in better decision making as compared to when shopping in the retail store. Shoppers generally save effort as they do not have to go to a mall to make the purchase. The shoppers also save time by not getting into

unproductive jobs such as waiting in the traffic, parking the car and having food etc. This saved effort and time is also translated into saved costs. These saved costs and psychological

satisfaction results in convenience in online shopping. (Jayawardhena et. al., 2009) When compared with traditional shopping, online shopping was perceived to be saving more time. (Alreck & Settle, 2002)

b) Service quality

Traditional literature has clearly proven the positive effect of quality of service delivered by the people to the consumers on the consumer’s attitude to buy the product. But in case of

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commerce as there is no physical touch point and the transactions take place without the human contact. In Online shopping, the buying decisions are made without any assistance by support staff or a customer representative. However, the customer expects the website to assist him in the similar fashion and optimize his experience. (Globerson & Maggard, 1991)

A study was conducted to identify the areas which could explain the dynamics of consumer’s decision to buy online. (Chang et. al., 2005) This study reviewed the 45 existing empirical studies to identify and analyze the patterns and similarities among them. It was interesting to see that there were mixed results regarding the service quality and behavioral intention to make a purchase. However, one aspect that came out to be significant was providing good pre order information (Vijayasarathy & Jones, 2000). It was seen that providing better product information, price comparisons or detailed product specifications, positively impacted the attitude towards online shopping. It can be said that any information which helps the users in making a purchase decision is crucial. The consumer values time saving and methods must be employed to make the checkout and delivery process as simple and fast as possible. (Bellman et. al., 1999)

D.

Perceived Risk Theories

A study by Chung et al (2010) investigated the factors which affect the consumers’ behavioral intention to participate in the online communities using Technology Acceptance Model (TAM). The study hypotheses that there exists a positive association between perceived privacy

protection and the perceived usefulness. The study results showed that perceived privacy

protection had a significant effect on Behavioral Intention. Thus, the issue of privacy while using an online system could be an issue for the current users as well as prospective users.

Another study conducted on internet banking adoption in India concluded that perceived risk impacted the behavioral intention to use negatively. It also revealed that trust had a negative effect on perceived risk. This means that if a consumer develops trust in a technology, he sees it to be less risky and is more likely to actually use it. (Kesharwani & Bisht, 2012)

In a study to understand why some shoppers shop online while others do not (Bhatnagar, Misra, & Rao, 2000) it was found that in case of online shopping, the two predominant risks as 1) Product category risk 2) Financial risk. For product risk, the study says that it increases with complexity of the product, association with ego-related needs, price of the product, when feel and touch are important. The financial risk, according to the study is linked more with the use of

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24 internet as the customers are generally concerned about the credit card fraud or their information being misused.

In a study to find out the reasons why customers choose or choose not to use the technology enabled services such as internet banking or online shopping, a behavioral model was developed and tested. (Walker & Johnson, 2006) It gives us some important insights and says that the perceived risk depends mainly on two factors. First risk is due to technical performance and functional reliability of the delivery service which means that whether the delivery system will perform satisfactorily, accurately, reliably and will deliver the required service effectively. The other risk is due to the issues of privacy and security while using technology systems.

E.

Effect of age on acceptance of technology

The study (Chung et al, 2010) was conducted using TAM where the relationship between age and the elements of TAM (Perceived Ease of Use and Perceived Usefulness) was investigated in context of participation in online communities. The results of the study partially supported the proposition that age has a moderating effect on different antecedents and variables.

The study found negative association between the age and the perceived usefulness. This meant that even after rapid growth of internet use among the older generation, there is still a significant gap when compared to the younger generation. However, the study did not find a similar

relationship between age and perceived ease of use in the contact of participation of online communities.

An empirical study was conducted (Lian & Yen, 2014) to understand the online shopping drivers as well as barriers for older adults. The knowledge of drivers and other influencing factors would then help in designing better products and services for the older adults and would also help us to understand the way these products need to be projected during marketing. Most of the studies are targeted towards studying the drivers of accepting a technology, however this research also studies the barriers for acceptance of new technology.

The following are the major conclusions from the study:

1. The older adults are more driven to but online due to the social influence and performance expectation.

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25

a. Value: Value is the perceived benefits of the new offering as compared to the existing offering.

b. Risk: Risk is the perceived uncertainties and ambiguities in the new offering due to lack of experience and information.

c. Tradition: Tradition refers to the inertial resistance due to change in existing habits. This is because, generally a new technology interferes with the existing way of working.

3. For online shopping, the drivers outweighed the barriers for younger generation, as opposed to the older generation for which, the barriers outweighed the drivers.

V. Market reports

A.

KPMG - The truth about online consumers.

KPMG is among the largest professional services companies in the world. It operates in 52 countries with around 189,000 employees and provides Auditing, tax and other advisory services. In 2017, KPMG organized a research to understand the shopping behavior, drivers and

perceptions of online shoppers globally towards online shopping. The study lasted for around 12 months was conducted using an online questionnaire which received total of 18,430 responses were received from 51 countries.

The study brought about some interesting facts about the online shopping behavior of the consumer. We discuss some of its implications which are relevant to our research.

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26

Figure 11: Reasons consumers shop online instead of in stores

Source: Global Online Consumer Report, KPMG International, 2017

Reasons Consumers Shop Online instead of in Stores: The top factors to motivate the buyers

to go online are Flexibility and cost savings. Online channels give the user flexibility to shop anytime and the ability to compare prices, and offerings and hence take a more informed

decision. Consumers also preferred online channels because they do not want to go through the negative experiences associated with in store shopping such as long checkout queues, locating the items etc.

These insights are important because if we know what customers are looking for when choosing online, we can understand the customer journey and hence build the solutions accordingly.

Customer really values the ease of use delivered through online channels. This is depicted by the reasons customers buy online, such as ability to compare prices, save time, locate hard to find items etc.

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27

Figure 12: Reasons consumers shop in stores instead of online

Source: Global Online Consumer Report, KPMG International, 2017

Reasons Consumers shop in stores instead of online - In this study, when the consumers were

asked, why do they choose to go to the stores instead of shopping online, the most common reason that came out was that they wanted to touch, try or verify the appearance, or features of the product. This mainly came from the fact that they were concerned the delivered product will not be of the same quality or specifications. Another important reason that comes up from this study is that the customers are unhappy with the service quality, which in this case is the long delivery time.

As consumers shift to online mediums, it is important to understand what the barriers to online shopping are. When we know what the consumer is looking for in a retail store, we can enhance our online channels to fill in that gap.

These reasons tell us that maybe the customers do not find the online channels useful due to the barriers of late delivery and intangibility. Also, the buyers are concerned that the product might look different and also that the online system might not be secure, this means they perceive online shopping as risky.

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Figure 13: Most important attributes when deciding where to buy

Source: Global Online Consumer Report, KPMG International, 2017

Important attributes when deciding where to buy - One of the most important company

attributes which attract the customer is the lowest price of the offering. However, price is not the only factor which should be taken into consideration while creating a digital strategy for the consumer. The consumer values the service quality too. Features such as delivery options, return policy stock information and detailed descriptions also play a great role.

Some other attributes like ability to see stock levels, tailor made promotions, similar experience in store and online give us a hint that the customer values ease of use while making a purchase decision.

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29

Figure 14: Reasons Consumers shop in stores instead of Online – By generation

Source: Global Online Consumer Report, KPMG International, 2017

Another inference from this study is the segmentation of these drivers based on generation. When the results of this study were distinguished based on different age segments, it was seen that the older generation was more inclined towards checking the look and feel of the product physically but the younger generation trusted the online channels more readily. It was opposite in the case of Delivery time where the older generation is satisfied with the longer delivery times but the young generation wants instant gratification and thus faster delivery times.

B.

Ripen - Why 92% of Retail Purchases Still Happen Offline

An independent survey conducted in USA found that even today 92% of the sales happen offline and online accounts to only 8% of total retail market. For this study 1235 American shoppers were surveyed to find out the top most things that keeps them from going online

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Figure 15: What would make you most likely to purchase an item in-store instead of online?

Source: https://ripen.com/blog/ecommerce_survey

The most dominant reasons found from this research were:

a) 30% of the respondents wanted to see or feel the product before taking a buying decision. They want to feel the quality, aesthetics and the design of the product. This is something which is completely missing in the online shopping experience.

b) 29.9% of the respondents wanted instant gratification. Generally the consumers want the product right away and do not want to wait for the delivery of the actual product.

c) 16.9% of the people who took the survey are worried about their privacy while shopping online.

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A.

Research Framework

Figure 16: Research framework based on technology Acceptance Model

Source: Davis et. al. (1989), Venkatesh et. al. (2003)

Based on the Technology Acceptance Mode a framework has been designed for this study. The following are the main elements of the framework:

1. Technology Acceptance Model (Davis et. al., 1989) 2. Questionnaire to test PEOU and PU

3. Potential Antecedants – Service Quality, Perceived risk and website/app design 4. Moderating effect of age on the Perceived Ease of Use and Perceived Usefulness

The above elements of the framework have been discussed in detail in the next few sections.

B.

Use of Technology Acceptance Model

The conceptual framework of this study is based on the Technology Acceptance Model (Davis, 1989) in this research, the Technology Acceptance Model is used to identify the reasons which lead to the acceptance of website and Mobile application as a primary channel to buy products and service from Vodafone.

There have been numerous studies which have validated technology acceptance model to be a robust and a principled framework to identify the antecedents for the acceptance of different

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32 online applications. A lot of studies along with validation, also extended the TAM to add one or many antecedents to make it even more relevant and applicable to a specific context.

Adoption of Internet Banking (Kesharwani & Bisht, 2012)

The model integrated perceived risk into Technology Acceptance Model by studying the effects of security and privacy related issues on the adoption of internet banking. The study found negative relation between the perceived risk and individual’s intention to use. The study also revealed that trust is an important driver in reducing the perceived risk. Listed below are the findings of some of the studies to understand the effect of variables in different contexts.

Thus, the study implies that managers should consider these findings while developing an online banking system and incorporate the elements of trust and perceived risk in their design.

Adoption of Mobile Commerce (Bruner and Kumar, 2005)

This study applied the Technology Acceptance model to the consumer context model called as c-TAM and extended it by analyzing the utilitarian and hedonic aspects of the technology usage. The empirical results of this study showed that hedonic aspects of technology use contribute more towards technology adoption that usefulness.

Thus, when seen in a consumer context the elements of fun and enjoyment outweigh the practical elements such as convenience etc.

Participation in online Communities (Chung et. al., 2010)

This study was conducted to investigate the factors that affect the future intention of a user to participate in the online social communities. The study was conducted using Technology

Acceptance Model with added factors of Quality, technology affordance and privacy protection. It also studied the variation in the effects of these factors with the age of the participants.

The results of this empirical study, supported the propositions of the TAM however, the hypothesis that perceived ease of use is a predictor of perceived usefulness was not confirmed. Also it was confirmed that perceived usefulness, perceived ease of use and intention to participate in the online communities do not vary with the age differences of the users.

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33 A study was conducted to validate the Technology Acceptance Model (TAM) in World Wide Web context. Ease of use and Usefulness are fundamental in explaining the user acceptance of Information Systems. But In this study, it was believed that these elements were insufficient in predicting the acceptance of newly emerging technologies like www. So, playfulness was added as a new factor which reflected the intrinsic beliefs in adoption of World Wide Web services.

Based on the empirical analysis of the factors, it was seen that as per the existing belief, Perceived ease of use and perceived usefulness were important for user’s acceptance of www systems. But, surprisingly, it was seen that playfulness also had a significant effect on the user’s attitude towards Internet systems. Thus the study suggests that perceived playfulness should be considered as an important factor and while designing future internet systems, emphasis should be given on curiosity and enjoyment.

C.

Relevance of TAM for this study

Accessing the Vodafone telecom services through website or mobile application is an innovation in the existing retail and telemarketing formats. This involves the use of new technologies, devices and calls for a changed consumer shopping behavior (product search, self-service, etc.). As seen from some of the example studies mentioned above, Technology Acceptance Model has already been proven to be successful in investigating and predicting the adaption of such new technologies.

Thus, for this study TAM can be used as a foundation for investigating the user perceptions on acceptance of Vodafone website and mobile application. Most of the studies have used a survey questionnaire and have done an empirical analysis of the responses to validate their hypotheses related to TAM in a specific context. A lot of existing observations and conclusions drawn from such studies can be directly translated in the context of our study.

D.

Use of Survey Questionnaire

Though extensive research has been conducted to validate the relationship between different elements of the TAM but the perceptions of ease of use and usefulness for the Vodafone Mobile app and website still need to be validated before making any recommendations.

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34 The use of questionnaires as a method of data collection to validate the technology acceptance model and identify the drivers of perceived usefulness and perceived ease of use has been very popular. The benefit of using a questionnaire is that we can set the format of the responses based on the type of analysis we tend to perform on the collected data. (Rattray & Jones, 2005)

The questionnaire includes multiple measurement items for each dimension. The dimensions are based on the elements of Technology Acceptance Model (such as perceived ease of use,

perceived usefulness, behavioral intention to use etc.) and some other dimensions can also be added based on the scope of the study. (Such as enjoyment, risk, social influence etc.) Once the questionnaire is designed, it must be reviewed by an independent reader. Once the second validation of the questionnaire is done, a pilot test of the questionnaire must be conducted to ensure that it is successfully fetching the desired data. After testing the reliability of the questionnaire, it must be revised and finalized for the main survey.

For our study perceived usefulness and perceived ease of use can be tested by using a

questionnaire and conducting a survey with the target customer group. Based on the responses of the survey conclusions and managerial recommendations can be made. Since we are taking into considerations two online sales channels for Vodafone and both the channels present different challenges, it is necessary to conduct two separate surveys, each with a purpose to test the perceived ease of use, perceived usefulness and perceived risk.

The collection of data and the empirical analysis of the data is not considered in the scope of this study. For the study, only the recommended sample questionnaires have been created. These questionnaires can be further used by VodafoneZiggo to test their website and mobile app. By collecting the data about the perceptions of the users, the company will be able to determine conclusively if the users perceive the Vodafone application and website to be useful to them and if they believe that they are easy to use and learn.

The proposed Questionnaires are attached in the end of this study.

E.

Potential Antecedents

As discussed earlier, the questionnaire approach to understand the drivers and barriers to acceptance of a technology has been used extensively. These findings though being applied to

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35 different contexts, have found some similarities. Perceived Risk has been seen as the common factor affecting both the perceived usefulness and perceived ease of use. The studies related to the adoption of online shopping found the User Interface quality and service info quality to be important drivers for perceived ease of use. (Park & Kim, 2003). The study also has found that Service quality and product quality are important drivers for perceived usefulness of online shopping.

1.

Service Quality

Service Quality refers to the quality of overall offering provided by the online retailer. When a buyer buys online, he changes his shopping behavior and instead of buying from the retail stores buys online. In this case it becomes important that the overall experience and benefits provided by the online channels is better than the retail channels.

There can be a number of areas which fall under the category of service quality. Availability of an efficient customer service is a big aspect of service quality. When the customer makes a purchase online, he expects similar service as he gets in the retail stores.

Therefore, it becomes important for an online channel to provide good customer service to the customer and to help him at every touch point. A big issue in online purchase of telecom products is physical signature on contracts. This add to an extra step of getting the print out, signing, scanning and sending it back to the company. Another challenge in online retail is the lack of instant gratification. Psychologically, when a shopper makes a purchase in retail stores, the feeling of acquisition is the greatest factor leading to satisfaction. However, in the case of Online shopping, whenever a purchase is made, the customer receives the product after a few days. This has a negative influence on consumer’s attitude towards online shopping.

a)

Industry Best Practices examples on Service Quality

Subscription with virtual authentication by Belsimpel - One of the biggest hassles while

buying a subscription from a company for the user is to sign a contract. Most of the companies send the contract via email and leave it to the user to get a print out, sign it and send it back to the company. But Belsimpel has gone an extra mile to enhance the customer journey by introducing virtual authentication. The users can authenticate the contract via iDEAL method or through an

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36 SMS message. This has proven to be a great success as it saves a lot of time and effort for the consumer.

Next day delivery by Mobiel.nl - A lot of companies have improved the quality of service by

shortening the delivery cycle. The next day delivery is very common in Netherlands, however, some companies have even gone an extra mile by providing same day delivery. This eliminates the most important barrier of instant gratification for the customers. Companies such as Amazon has been doing this for quite a long time in telecom space, companies like Belsimpel, Mobiel.nl etc. also provide next day delivery.

b)

Conclusions from the market reports

In the report by KPMG we found delivery is the second most important reason category why shoppers do not buy online. Some of the following insights can be drawn from the report:

 34% users do not buy in online because they believe that the delivery times are very high.  25% of the shoppers believe that shipping costs are too high.

 43% of the correspondents believe “Enhanced Delivery Options” to be the most important company attribute when deciding where to buy.

 39% millennials believe that the delivery times are too long as opposed to 23% baby boomers, making the millennials as the most sensitive category to the delivery times

In a consumer market study by an independent marketing firm Ripen, to identify why still most of the sales happen offline, the following conclusion was drawn in regards to the delivery time:

 30% of the shoppers believed that ‘Instant gratification’ makes them more likely to shop in the stores instead of going online.

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Figure 17: Obstacles for web sales

Source: Eurostat, 2016| PWC, 2017; www.ecommercefoundation.org

An Ecommerce report on Netherlands published by the Ecommerce foundation in 2017 revealed the biggest obstacle for web sales. Based on the above graph, it is clear that around 30% of the issues are related to the delivery of the products. Speed of the delivery account to 20% of the problems encountered by the consumers during online purchases. 9% issues are related to the wrong products delivered and 3% are related to the delivery costs.

Thus, we conclude on the analysis of data on service quality from different sources, that Delivery is one of the most important aspect deciding the acceptance of online shopping. Most common issues related to Delivery include long delivery times, High shipping costs and lost or wrong product delivery.

2.

Perceived Risk

Online channels are still relatively new for the customers. This novelty raises some questions in the minds of the consumers. Although consumers perceive risk in all of their purchasing touch

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38 points, but non-store purchase decisions generally have higher perceived risk associated with them.

This is mainly because of the fact that the customers do not have any personal contact with anybody who they can trust. Also, the concept of online shopping has been present for only one and a half decade as compared to other channels which have been present since centuries.

Therefore, people feel uncomfortable to accept this mode as a replacement for their long-standing habits. Along with the risk of receiving the wrong product, the perception whether the stored data will be dealt with safely has been seen to affect the adoption of an online system significantly. (Phang et al, 2006)

To reduce these risks, and establish customer loyalty, the merchants need to shift the focus from the aspects of transactions to that of providing services to the customer. This would mean that end to end shopping experience is enhanced, and the entire customer journey is free from any perceived risk (Zeithaml, 2002)

a)

Industry Best practices on reducing Perceived risk

Best price Guarantee by Belsimpel - Belsimpel offers its customers a guarantee of the best offer

price. It claims that its products are the cheapest in the market and any one can challenge it. This means that if any customer buys from Belsimpel, and after buying he finds the same product and service from another website at a cheaper price he can contact the company. If found correct, Belsimpel will pay the difference amount to the customer.

Easy returns- To reduce the risk of purchasing online, a lot of companies offer free returns. This

is particularly common in fashion industry where there is always a risk of choosing the wrong material or size. However, it is also popular in other sectors, where retailers offer a time period of around 30 days to return the product at no financial consequences. This is a great way to ensure that customers do not perceive a risk of losing money on making a wrong purchase.

Customer reviews - Customer reviews have proven to be very helpful for the online shoppers in

making the purchase. A buyer tends to trust the reviews by other users more than any advertising effort by the retailer. Websites also allow the users to upload the images of the received products. By viewing the actual product pictures and the customer reviews, a potential buyer feels safer while making a purchase.

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Comparison with other websites – A lot of users visit the web to compare different products in

terms of price or other specifications. Thus, multiple comparison websites have been built and they are seeing increasing visits every year. In a study it was found that for telecom products, 68% of users use comparison websites to buy telecom products. After seeing the popularity of theses websites, a lot of companies have started displaying the results of comparison websites on their own websites. This really helps the user to make a more informed purchase and gets more satisfied.

Figure 18: Consumer Behavior: Comparison websites

Source: Statista; Vostradamus, 2017; www.ecommercefoundation.org

b)

Conclusion from market reports

In the online consumer report by KPMG we found a lot of barriers to online shopping were related to the perceived risk by the customers. Some of the following insights can be drawn from the report:

 41% of the respondents were concerned that the actual products might look different  24% of the respondents felt that the product they were buying was too valuable to buy

online. This meant that they saw a financial risk in making a transaction online.

 15% of the respondents said that they want to verify the authenticity of the product first and then buy it

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40

3.

Website/Application Design

Website design plays an important role in driving the customers online. A clear and intuitive web design attracts a larger number of customers. Since customer is replacing a conventional retail store with online channels, he expects the same level of knowledge and control while making a purchase. A simpler, clear design with detailed description and information of the products gives him a satisfaction of being aware of what he is buying and what the outcome of the purchase will be. (Park & Kim, 2003) Thus, information quality plays an important role in defining the

consumer attention to make a purchase online.

Any method which can help the customer in making a better and more informed decision falls under the category of website design. This can include detailed description and specifications of the product or service, accurate images and videos of the products, comparison of the

product/service with competitors or frequently asked questions related to the offering. Some other techniques which drive the customer psychologically towards making a purchase can also be classified under the website design. Some examples of such technique are personalizing the service for the user, providing right information at the right place, giving recommendations based on the behavior, using colors which are soothing to the eye etc.

a)

Industry best practices on Website/Application design

Introduction of Augmented Reality and 360 Views - A lot of online retailers are now adopting

augmented reality and 360 views to give the customer maximum information about the product and hence making the customer feel more confident and comfortable while making the purchase. Companies like IKEA have introduced a virtual store on the website which makes the customer feel as if he is in the actual retail store and hence can visualize the store with comforts of sitting at home.

Designing according to human Brain - Many studies have proved that human brain reads and

processes visual information in a certain way. So it should be taken care of while designing and placing the content on the website. Human brain generally reads from left to write and concentrates more towards the top. So the most important content and action items should be placed in the first two paragraphs.

Use of IBM Watson powered chatbots - An important aspect which goes missing in the online

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41 chatbots. Conventional chat windows on the website include a customer service representative answering the queries, but with the advancement in AI, companies are collaborating with IBM Watson do develop a self-learning chatbot which can answer all the queries of the customers. These bots are faster and can be programmed to answer the queries as effectively as possible.

Information available on one Page – In several studies, it is seen that a consumer does not want

to shuffle through the pages back and forth to find information. The right information needs to be present in front of the eye of a customer when he wants access to it. So, all the important

information should be provided to the user by keeping the customer journey in mind so that it makes the overall experience better for him. Amazon ensures this by prioritizing the placement of information based on the customer need.

Clear navigation: For visitors, menu bar is the first interaction with your website or app. A

visitor spends around 6.48 seconds on the navigation bar to find what he wants. It is important for the website to make sense to him and deliver what is needed within that time. The navigation bar should help the user to access all the parts of the website and also know about the products and services available.

b)

Conclusions from the market reports

In the online consumer report by KPMG we found Touch/Try the product as the most important reason category why shoppers do not buy online. Some of the following insights can be drawn from the report:

 56% of the respondents do not buy online because they want to see/touch or use the before buying

 41% of the respondents feel that they do not purchase online because they are concerned that the product might look different than what is shown online.

In a consumer market study by an independent marketing firm Ripen, to identify why still most of the sales happen offline, the following conclusion was drawn in regards to the delivery time:

 31% of the respondents said that the most important reason for most of the sales

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