An Empirical Study of Impulse Buying Behavior in ...

International Journal of Online Marketing, 3(3), 1-17, July-September 2013 1

An Empirical Study of Impulse Buying Behavior in Online Bookstores G. Muruganantham, Department of Management Studies, National Institute of Technology, Tiruchirappalli, Tamilnadu, India Ravi Shankar Bhakat, Department of Management Studies, National Institute of Technology, Tiruchirappalli, Tamilnadu, India

ABSTRACT Online shopping is gradually becoming popular in the developing countries like India. The online bookstores have emerged as a new destination which attracts millions of shoppers every day. The impulse buying in the offline stores has been a major area of interest for the researchers. But with the boom in online shopping, there is a scope to study the different aspects of impulse buying in online stores. This paper presents the study of various aspects of online impulse buying viz. hedonic shopping, website quality, trust, situational factors and variety seeking in Indian context. With the data collected from the online survey method the different antecedents of impulse buying have been analysed and reported on the basis of their significance. The hedonic shopping was found to be the major factor influencing impulse buying in online bookstores. This study also discusses about the managerial issues, suggestions and implications for the future researchers. The understanding of the behavior of the online shoppers in terms of their impulsive behavior would be helpful for the marketers and academicians. Keywords:

Consumer Behavior, Impulse Buying, Indian Consumer, Online Bookstores, Online Retailing, Online Shopping

INTRODUCTION The research area of impulse buying has attracted the attention of marketing researchers in the offline retail stores as well as online stores (Beatty & Ferrell, 1998; Zhang et al., 2007). Piyush et al. (2010) found that all kind of products could be purchased impulsively and all consumers engage in impulse buying at

various occasions. The different contemporary marketing innovations such as twenty four hours stores, television and internet shopping promote impulse buying. The growth of online retailing and the increasing consumer orientation of many societies offer greater opportunities for impulse purchases (Kacen & Lee, 2002). The online stores are capitalizing on this behavior by developing an interactive media and providing

DOI: 10.4018/ijom.2013070101 Copyright © 2013, IGI Global. Copying or distributing in print or electronic forms without written permission of IGI Global is prohibited.

2 International Journal of Online Marketing, 3(3), 1-17, July-September 2013

consumers a scope to buy at any time round the clock (LaRose, 2001). Impulsive buying behavior is an important phenomenon in the context of retail business and marketing (Verplanken & Sato, 2011). User Interface Engineering, a leader in website design has stated that more than one third of the purchases in the various online commerce websites are due to the phenomenon of impulse. There are various external stimuli present in the online stores which engage the customers and promote online impulse buying (Madhavaram & Laverie, 2004). The environmental stimuli of the online stores affect the consumer emotional reactions which further influence the urge to buy impulsively (Parboteeah et al., 2009). Consumers are motivated by convenience and are likely to shop online for specific types of products and services, e.g., books and magazines and travel (Rohm & Swaminathan, 2004). According to Associated Chambers of Commerce and Industry of India (Assocham) survey 2012, the online retail market in India may grow to Rs 70 billion (over $1.30 billion) by 2015 from Rs 20 billion. The Nielsen report 2011 stated that Indians are most likely to buy books (41 per cent) followed by travel ticket/reservations (40 per cent), and electronic equipment such as TV and camera (36 per cent) online. The online bookstores and other formats of retailing have been fostered by the development and penetration of Internet and World Wide Web. The success of Amazon in 1995 has motivated different players to make a foray into the online market. In 1997, an established bookstore Barnes & Noble opened its online bookstore to join the battle against Amazon. After the success of Amazon and Barnes and Noble; Books-A-million also entered in the online bookselling arena with the launch of e-commerce website in 1998. Now it is almost a common trend for the various booksellers to have presence in online as well as brick and mortar avatar. In the case of India, the online retail giant Flipkart has a wide and powerful presence in the virtual market which has started with the

bookselling business. It has also become the first Indian online retail company to achieve the worth of 1 billion dollar. In the present scenario there are scores of bookselling websites such as Infibeam, Bookadda, Homeshop18, Indiaplaza and Landmarkonnet which have given a tough competition to the Flipkart established business. The huge competition poses a need to understand the book retailing business and the customer’s behavior in the online book selling websites. In order to be successful, the online retailers especially the booksellers must understand the consumer’s characteristics and needs. It is therefore important for the retailers to comprehend the online impulse purchase behavior and the different factors that could possibly influence the buyers involving in it. Online bookselling is one of the most competitive areas when it comes to online retailing. With the increasing growth of the Internet, the online book stores have to adjust their respective strategies to maintain presence online and compete. This paper therefore focuses on the different aspects of online book purchases and the intricacies involved.

NEED FOR THE STUDY The online shopping in India is going through a phase of huge growth as well as competition. The impulse buying has become an ubiquitous phenomenon in the various online stores which poses a great scope to understand the consumer decision making in the context of online shopping. There are numbers of research works available in the online shopping context but the online impulse buying has received little or limited attention from various marketing academicians. The research gap is reflected in terms of the dearth of literature which poses the scope to investigate the upcoming phenomenon of online impulse buying. The overall purpose of this research paper is to gather deeper understanding of the various aspects which are significantly related to the impulse buying of the Indian online

Copyright © 2013, IGI Global. Copying or distributing in print or electronic forms without written permission of IGI Global is prohibited.


shoppers in online bookstores. This research paper also encompasses the various factors which are predicted to be the influencers on antecedents of online impulse buying.

RESEARCH OBJECTIVES The objective of this study is to identify the factors which influence the impulse buying behavior in the online bookstores. In first phase of the study a conceptual background is developed based upon an extensive literature review. This is followed by an empirical study, where the factors that potentially affect the impulse buying in online shopping are analyzed. The specific objectives are stated below: • • •

To identify the factors which act as critical factors for impulse buying in online bookstores; To determine the relative significance of each factor that are crucial for impulse buying of books in online bookstores; To provide suggestions for the online retailers based upon the finding of the study.

LITERATURE REVIEW Impulse buying has been defined as an instant, compelling, emotion-driven behavior in which the impulse decision precludes consideration of choices or alternative (Bayley & Nancarrow, 1998). Piron (1991) described Impulse buying as a purchase that is unplanned, result of an exposure to a stimulus, and decided on the spot. During impulse buying there is a strong and sudden desire to buy a product without much contemplation, which one did not intend to purchase before entering the store (Rook & Fisher, 1995). The impulse purchases are unplanned in nature, where the shoppers buy the object on the spur of the moment (Stern, 1962). Impulsive buying has been studied in both the offline as well as online context (Adelaar et al., 2003; Costa & Laran, 2003). Madhavaram and Laverie

(2004) explored the concept of online impulse buying and identified that website features, images, banners, and other advertisements promote the behavior. The low prices and feeling of smart shopping are found to be associated with the online impulse buying (McGoldrick et al., 1999). Verhagen and Dolen (2011) found that impulse purchasing apparently occurs in about 40% of all online expenditures and further suggested that the understanding of consumer buying behavior in online transactions is very crucial for the online retailing practitioners. Dawson & Kim (2010) investigated external cues that encouraged impulse buying and found that sales promotions can prompt impulse buying. Laing and Royle (2013) found that although the occurrence of impulse buying is more in traditional bookstores there is a significant amount of shoppers (26%) who are involved in impulse buying in online bookstores. According to, “2010–2011 U.S. Book Consumer Demographics & Buying Behaviors Annual Review” 11% of book buyers were found to be involved in impulse buying. Based on the above studies it is evident that impulse buying is prevalent among online shoppers and there is a scope of studying impulse buying in online bookstores.

Hedonic Motivation There are different works of the past researchers (Hirschman & Holbrook, 1982; Hausman, 2000) which emphasise that consumers buying process is, not only need and necessity driven or the monetary value of the product but also driven by completely different factors viz. amusement and surprise. The various noneconomic factors which are associated during the process of buying or purchase can be collectively termed as hedonic motivations and the shopping of products as a result of fulfilling these motivations is termed hedonic shopping (Arnold & Reynolds, 2003). Hirschman and Holbrook (1982) described hedonic consumption as those aspects of consumer behavior which is associated with the multisensory, fantasy and emotive aspects of



shopper’s experience. A hedonic shopping experience is likely to produce emotional arousal which leads to impulse buying behavior (Rook & Hoch, 1985). According to Hausman (2000) consumers feel better after an impulsive purchase, even experiencing a feeling of being rewarded. Impulse buying has been linked to negative emotions of the shoppers (Silvera et al., 2008) and they may further get involved in impulse buying in order to alleviate negative emotional moods (Verplanken et al., 2005). The association between impulse buying and emotional factors (e.g. happiness, excitement and pleasure) is also supported by various researchers (Baumgartner, 2002; Sharma et al., 2010).

Website Quality Environmental psychology (Adelaar et.al. 2003) is found to be significant while investigating impulse buying in online stores. Mohan et al. (2013) stated that various elements of store environment may also contribute to impulse buying. In an online context, environmental cues have been found to be strong predictors of impulse buying (Adelaar et al., 2003; Parboteeah et al., 2009). The presence of high-quality environmental cues in an online interface increases the website’s quality (Loiacono et al., 2007). Online shoppers have been found as more impulsive, and have favourable attitude towards advertising and direct marketing than the offline shoppers (Donthu & Garcia, 1999). Larose (2001) stated that impulsive, compulsive and addictive buying are the various degrees of the lack of self-regulation in the online shopping. Popular online shopping sites with enriched attractive features are able to diminish selfregulation. Hoffman and Novak (1996) suggested that features of a website interface are an attractive medium for interaction between an online retailer and its customers. Dawson and Kim (2009), supported the idea that online consumers are more impulsive due to the stimuli such as an image, a description in an email, a banner advertisement, a recommendation of product, graphics, text, pop-up

windows, search engine configuration, audio, color, streaming video, an article, or a sign. In the case of online shopping, being attracted to the various external stimuli results in influencing the rational buying decision which could lead to impulse buying (Larose & Eastin, 2002). Website quality explains the usability as well as the information quality of an online store (Barnes & Vidgen, 2011). During online shopping consumers usually expect the three website qualities to support their online transaction, i.e., information quality, system quality and service quality (Lin, 2007). Information quality is evaluated in terms of ease of use, usefulness, relevance and whether the site is updated (Li et al., 2002; Liao et al., 2006). System quality is based upon the factors such as fast page loading, clear presentation, and simple navigation and is the key to creating a successful e-retailing business (Burke, 1997; Donthu & Garcia, 1999, Wang & Emurian, 2005). Service quality is the overall support delivered by the online service provider, which was measured in terms of assurance, empathy and responsiveness (DeLone & McLean, 2003). Liu and Arnett (2000) pointed out that the higher the information quality on a website, the higher the user satisfaction, perceived benefits and level of system use. Hoffman and Novak (1996) claimed that a well-designed interface increases the likelihood of impulse purchases. Wolfinbarger and Gilly (2003) also demonstrated the relationship between a well designed website and increased purchase behavior. There is a relationship between buying products impulsively and the quality of the website (Parboteeah et al. 2011). Thus it is evident that website design is of great importance when making a purchase impulsively when visiting the website, which further could increase the conversion rate (Phau & Lo, 2004).

Trust Trust is a conviction when the customer develops a tacit understanding with a seller, and a seller can be relied upon to behave in such a manner that the long-term interest of the



customer will be served (Crosby et al., 1990). The importance of trust is elevated in the highly uncertain e-commerce environment (Pavlou, 2003). In economic exchanges during online shopping where uncertainty is present, people adopt trust to get involved in the process (Gefen et al., 2003). There are different works on perceived risk in online purchase settings (Pavlou & Gefen, 2004) which considers the importance of trust in online retail settings. According to Jarvenpaa et. al. (2000) trust affects the attitude and risk perception, which further influence the intention to buy in an online store. Hoffman & Novak (1996) suggested that internet offers wide variety of information and the consumer is left to choose among the multitude of the information. McKnight et al. (2002) has stated that trust is having a significant impact on consumers intention to purchase in the different online store environments because it helps in dealing with uncertainty. According to the Jarvenpaa et al (2000) trust contributes positively towards the success of online transactions. Technical adequacy could improve the security of online transactions and contribute to convenience of usage thereby increasing customers’ confidence and trust in the retailer (Gefen et al., 2003). Past researches has found that trust is a critical factor that determines a consumer’s intention toward online shopping (Corbitt et al., 2003; Pavlou, 2003; Cheung et al., 2005). Sun and Wu (2011) suggested studying online impulse buying behavior with respect to the trust and perceived risk of the shoppers.

Situational variables that influence consumer behavior have been the subject of numerous research papers since Belk (1975). The Belk’s taxonomy of situational factors originally includes five aspects - physical surrounding, social surrounding, time, shopping task and previous conditions with which the consumer enters the shopping surrounding or which result from the shopping surrounding. The customer’s response to shopping environment depends on the situational factors apart from the pre-shopping plans or purpose for being in the store environment (Russell & Snodgrass, 1987). Beatty and Ferrell (1998) studied the influence of situational variables on impulse buying in retail stores and found that time and money available during the buying process has significant effect. The time availability has been positively linked to search activity in a retail setting as browsers usually make more unplanned purchases than non-browsers (Jarboe & McDaniel, 1987). Individuals with more available time will browse longer and may submit to their impulse buying tendency (Iyer, 1989). Another factor which could influence impulse purchasing is the amount of money individual possesses or perceives he could spend (i.e., money available). Money available also includes the use of the credit facility. In this context of online bookstores the following situational factors are considered: time, money, store knowledge and mode of payment.

Situational Variable

Kahn (1995) defined variety-seeking as the tendency of individuals to seek diversity in their choices of services or goods. The consumer may involve in variety seeking behavior due to the internal need to explore new things. Impulse buying and variety seeking are of major interest to the researchers because of their ubiquitous prevalence across a diverse range of product categories (Vohs and Faber, 2007). Donthu and Garcia (1999) concluded that online shoppers have relatively high tendency for variety seek-

The impulse buying varies not only between the different shoppers but also for the same shopper under different situations (Stern, 1962). The situational factors have an important effect on impulse buying of same shopper under diverse circumstances. Bitner (1992) suggested that the relation between store environment and a customer’s response to the store environment is influenced by various situational factors.

Variety Seeking



ing. The people, shopping online get involved in the various offers and schemes. Variety seeking has been studied by many authors with respect to the buying behavior of the consumers in different retail settings. Variety-seeking behavior includes the need for a change associated with a brand and a product (Van Tripj et al., 1996). In a study on impulse clothing purchase, Chen-Yu and Seock (2002) found that wide product availability is the most important criterion of store selection for impulsive purchasers. Variety-seeking tendency has also been established as an important factor in shopping channel patronage (Michaelidou et al., 2005) and pleasure seeking behavior (Sharma et al., 2006). The convenience shopper, balanced buyer, and variety seeker exhibit a high propensity to shop in various product classes (Rohn & Swaminathan, 2004). In a study of online shoppers, Sun and Wu (2011) found that there are specific Web sites and retailers that feature weekly specials that are a strategic advertising display for consumers, which aim to stimulate impulsive buying from the consumer. There are many companies

trying to stimulate impulse buying through advertising, strategic planning, and convenience of purchasing (Sun & Wu, 2011).

Proposed Hypothesis and Research Framework This study is an attempt to explore the multiple dimensions on impulse buying in online bookstores. The content analysis and extensive literature review has focuses on the major aspect of the impulsive behavior. A research framework has been developed based upon the explored studies, which is to be evaluated in the subsequent empirical testing. The research model depicted in Figure 1 was developed to examine consumers’ online impulse buying behavior toward books. It also illustrates the relationships among five variables in an online shopping context. In this causal relationship based on five hypotheses there is a scope for structural model analysis for online impulse buying behavior. Based on the literature review the following hypotheses are proposed:

Figure 1. Research framework for online impulse buying



Hypothesis 1: Hedonic shopping motivation has a positive influence on impulse buying in online bookstores; Hypothesis 2: Website quality has a positive influence on the impulse buying in online bookstore; Hypothesis 3: Trust in the website has a positive influence on the impulse buying in online bookstore; Hypothesis 4: Situational variables have a positive influence on the impulse buying in online bookstores; Hypothesis 5: Variety seeking behavior has a positive influence on impulse buying.

RESEARCH METHODOLOGY A web based survey method is adopted in this research work. The respondents were contacted through the email groups and the social media groups. The online survey questionnaire was sent with the request mail to the potential respondents. The respondents are those who have bought books from online bookstores. The advantage with the online survey is that, there is convenience for the respondents as they participate with their own interest. The snowball sampling method was involved in collecting the responses, as the survey was circulated among the potential online buyers with the help of respondents. A total of 238 respondents participated in our online survey. The respondents were asked questions to elicit their behavior in online bookstores and demographic details. In an attempt to explore the impulse buying with respect to the online bookstore, respondents were enquired about hedonic motivations, website quality, trust, situational factors and variety seeking behaviour (See Table 1). The collected data was analyzed by exploratory factor analysis and confirmatory factor analysis. The different measures studied in this research have been properly validated and checked for the reliability. The internal consistency in terms of cronbach alpha has been found to be significant and acceptable to proceed further in the factor analysis. All the

items have been found to have the accepted level of internal consistency to provide a valid result in the analysis. To obtain the factors, a principal component factor analysis and varimax rotation was used. Finally, the structural equation modelling was used to analyze the behavior of the online impulse buying with respect to the identified factors. The structural equation modelling, when compared with other multivariate techniques such as multiple regressions, allows simultaneous test of relationships with multiple variables. In this present study considering the complexity of the model our sample size of 238 was more than sufficient for using the SEM (Hair et al 1998). The LISREL 8.8 package was used in producing the structural equation model (SEM) with latent variables to test the hypotheses (see Figure 2). The model was found to be fit enough and the various relevant fit indices are provided in the Table 4.

FINDINGS AND RESULTS Based upon the survey it has been found that majority of the respondents like purchasing books online. The participants have a genuine interest towards online book purchasing and are also involved in it. Majority of the respondents bought a book online within the past one month. Regarding the average spending habits per visit it is found that majority of shoppers spend on an average of 200-500 rupees in the online bookstores. The demographics of the respondents can be found in Table 2. Majority of the respondents reported that they spend up to thirty minutes in the online bookstores per visit. Although there are many online bookstores providing services with a huge level of competition it is found that Flipkart leads the as most favourable bookstore with majority of the responses, followed by Homeshop18 and Infibeam. The major reason behind purchasing a book is interest in the subject, offers and discounts. The reviews by the shoppers as well as recommendation of the website play a major role while making a purchase decision.



Table 1. Measures of constructs Construct

Items

Sources Rook & Fisher (1995); Beatty & Ferrell (1998)

Impulse Buying

I often buy spontaneously from online bookstores. I often buy from online bookstores without thinking. I buy from online bookstores according to how I feel at that moment. I do not plan most of my purchases from online bookstores. “Buy now, think about it later” describes me while purchasing from online bookstores. Sometimes I am out of control while buying from online bookstores.

Childers et al (2001); Babin et al (1994)

Hedonic Motivation

While visiting online bookstores, I feel a sense of adventure. I go to online bookstores for finding a perfect gift for someone. I enjoy shopping books for my friends and family in online bookstores. I enjoy looking for discounts and offers in online bookstores. I visit online bookstores to see what new books are available. I visit online bookstores to spend my leisure time.

Website Quality

The online bookstore is visually pleasing and attractive. The layout of the online bookstore is a well-organized. The online bookstore is easy to use. The online bookstore gives me a variety of choices.

Lin (2007); Loiacono et.al (2007)

Trust

I believe the online bookstore is trustworthy. The online bookstore provides the recommendation of books by customers preferences. Using credit card to make purchase from online bookstore is safe. My interaction with online bookstore is pleasant and enjoyable.

McKnight et. al (2002); Gefen et al. (2003); Van der Heijden et. al (2003)

Beatty & Ferrell (1998); Hung, C. J. (2008)

Situational Factors

When I have more time for browsing I am more likely to increase my purchase from online bookstore. When I have more money or I am likely to increase my purchase from the online bookstores. When I have more knowledge regarding the online bookstore I would like to buy more. Variety of Payment methods such as credit card and cash on delivery would increase my purchasing. Refund policy of online bookstore would increase my purchasing.

Sharma et. al (2006); Kahn (1995)

Variety Seeking

When I see a new product, I’m not afraid of giving it a try. I like window shopping to find out about the latest styles. I generally read even my junk mail just to know what it is about. I like to browse through mail order catalogs even when I don’t plan to buy anything. I often read advertisements just out of curiosity. I enjoy taking chances in buying unfamiliar brands just to get some variety in my purchases.

Literature and Fiction are the most sought after books, the second most popular books are academics and professional and Self Help and Personality development books are in third place of popularity. The favorite authors of the Indian online book buyers are Paulo Coelho, Chetan

Bhagat, Kalki, Stephen Covey, Robin Sharma, Peter Drucker, and Sidney Sheldon. It shows that fiction writers and self help authors are most popular among the age groups of 20-30 years. Approximately half of the shoppers do not take part in the review and recommendation process.



Figure 2. LISREL output

Table 2. Demographics Age Group (in Years)

Respondents

Percentage

20 and less

27

11%

20-30

164

69%

30-40

40

17%

40 and above

7

3%

Gender

Respondents

Percentage

Male

168

71%

Female

70

29%

Occupation

Respondents

Percentage

Private Sector

109

46%

Public Sector

38

16%

Self Employed

15

6%

Student

76

32%

Income (Indian Rupees)

Respondents

Percentage

Up to 20000

55

23%

20001 to 40000

66

28%

40001 to 60000

59

25%

60001 to 80000

26

11%

80001 to 100000

17

7%

Above 100000

15

6%



The factor analysis was done to understand the relative significance of the factors based upon the factor loading. Among the impulse buying construct the fourth and fifth item show maximum of factor loadings. The “buying now thinking about later” and “buying while out of control” explains the impulse buying behavior. The hedonic shopping items such as buying for a perfect gift and buying for the family and friends as well as buying for the sole purpose of discounts hunting are showing highest factors loadings (Table 3). Among the website quality construct the ease of use of online bookstores and well organised website shows highest relative significance. Regarding the trust aspect of the store, trustworthiness, secure credit transaction and enjoyable and pleasing experience contribute to the construct. The situational factors viz. money availability, knowledge and awareness of the store, variety of payment methods have captured the maximum variance of the construct. The variety seeking behavior which includes checking for the email advertisements, looking for online catalogues, novelty seeking causes highest visit in the online bookstores. The structural model is in consistent with the accepted criteria (1