J A Social Sci Humanities, 2016, 2:10, 70-75
ORIGINAL ARTICLE
Impact of Online Shopping On Conventional Retail Stores in South Goa (India): An
Empirical Study
Juao C Cost
Associate Professor, Member , Academic Council, Goa University Member, BoS, Goa University
DOI: http://dx.doi.org/10.15520/jassh210131
Introduction
E-commerce is buying and selling of goods and service
online. Internet is the best source to use this tool. Today the
amount of trade that is conducted electronically using
ecommerce has increased with a wide spread usage of
internet and technology. Through E- business different types
of business have gained an opportunity to increase their sale
and can maintain a direct relationship with the customers
without any person between you and your customer. Online
shopping provides all types of goods available in the virtual
world. More and more consumers are turning to the World
Wide Web (w.w.w) for their shopping needs which gives
them access to either local or international products with just
a click of the mouse.Online shopping is a form of e-
commerce which allows consumers to directly buy goods
and services over the internet through a virtual shop. People
find it convenient and easy to shop from the comfort of their
home or office. One of the great benefits of online shopping
is the ability to read product reviews written either by
experts or fellow online shoppers. In addition to online
reviews, peer recommendations on online shopping pages or
social media websites play a key role for online shoppers.
When they are researching future purchases, 90% of all
purchases made are influenced by social media, (Pick,
2015). The number of customers of the company has
augmented from one million users to 2.5 million in India in
the last four years. Some of the popular imported items
imported by Indians include home decor, branded and
unbranded apparel, accessories, and technology products
like laptops, (Hiwarkar, T.2013).
Aims and Objectives
Ø To study the effect of online shopping on profitability
of Retail stores
Ø To analyse the effect of online shopping upon Pricing
patterns of retail stores
Ø To know how online shopping is advantageous to
customers compared to retail shopping.
Ø To examine problems faced by retailers
Methodology of Study
The data for the study have been collected from primary
sources and secondary sources. Primary data have been
collected through direct personal interview where the
retailers selected at random were interviewed personally. A
questionnaire was designed to obtain the information related
to the objectives of the study. The same was administered
personally on 100 retailers from south Goa. The data
collected was classified, tabulated and represented through
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chart and bar diagram. For the purpose of establishing the
originality of the project and to collect quantitative data,
various research articles were reviewed published at national
and international level. The period under study is the
academic year 2015-16.
Importance of the study
The study focuses on impact of online shopping on selective
conventional retail stores. The study was conducted in each
taluka of south Goa. The study shows how conventional
retail stores are affected through online shopping. The study
also discussed the measures taken by traditional retail stores
to overcome the problems faced by them due to the advent
of online shopping.
Review of Literature
Cheema et al.( 2009 ) in their study on the topic “The trend
of online shopping in 21st century: Impact of enjoyment in
TAM model” found that online shopping stores allow the
customer to obtain required information about their purchase
which decreases the risk associated with new shopping
medium, leading to increase in the number of online
shoppers. The study revealed the insignificant relationship
of perceived usefulness with online shopping intentions,
which clearly means that the behavioural intentions of the
sample members towards online shopping was not due to its
usefulness but they were attracted towards the internet
shopping for other reasons.
Saha (2015) in his paper on the topic “The impact of online
shopping upon retail trade business” highlighted the impact
of the increasing trend of online shopping over the various
fixed shop retailers. The study found several driving factors
which influence consumers to shop online: e.g. price,
convenience in shopping and wide range of available
products available online.
Hiwarkar ( 2013) examined in his study on the topic “E-
Commerce impact on Indian Market: a Survey on social
impact” found that E-commerce is promising as a significant
instrument to make sure comprehensive growth. The
conventional model of business is undergoing a aquatic
change due to evolution of online shopping. It was also
found that Safe and secure payment modes are vital along
with the need to discover and popularize innovations such as
Mobile Commerce.
Lieber et al (2011) in their research paper “Online vs.
Offline competition” discussed about the offline and online
segments. In their investigation they found that online
connections already exist but they are expanding further.
 J A Social Sci Humanities, 2016, 2:10, 70-75
ORIGINAL ARTICLE
Online channels have to yet establish themselves in some
markets but where they have been developed they grow
faster than bricks and mortar channels.
Shim et al (2000) in their article “Assessing the impact of
internet shopping on store shopping” found that consumers
attitude towards the internet shopping and what factors that
influence consumers to purchase online. The study
concluded that internet shoppers tend to search for product
information on the internet to a greater extent which is easily
available and is an important tool that directs sales.
Hsiao and Ming Husing (2008) the study conducted on
“shopping mode choice: Physical store shopping verses e-
shopping” The study considered the competition between
store shopping and e shopping by examining their relative
advantages in some specific time and cost attributes. It was
found that purchasing online saves time and travel cost,
which is worth avoiding a shopping trip even though
customers have to wait for the product till their delivered.
Ashok Kumar Chandra (2013) highlighted that online
shopping is becoming a trending new retail shop in his
article, “Factor affecting the online shopping behaviour.”
The article was put forth to analyse the factors of online
purchasing which promotes consumers for online shopping.
Attitude of apparel online shopping showed that different
groups are significantly different in their attitude about
online shopping. The article suggested that the government
should have awareness programs for online shoppin
You Quinghe etal (2014) in their study titled “The Online
Shopping Changed the Retail Business Model.” found that
online shopping has captured the minds of the people and
more people are turning to online shopping for their needs.
Online shopping on a global scale is the most popular way
to shop; it also reduced the need for shopping in the store
which helps people to save time and energy. The researchers
have selected four factors on consumer attitudes towards
online shopping like convenience, website design, time
saving and security. Due to these factors consumers are
more comfortable to shop online as compared to retail
shopping. They also notice that it has become a challenge
for marketers to understand the customer’s needs for online
shopping.
Saha, Rathore (2014) in their paper on the topic “An
Overview of Changing trend of traditional retailing to I-
retailing”, focused on how internet retailing differs from
conventional retailing. Many components of internet retail
and traditional retail model are common. E-retailing covers
retailing by using latest technologies. The concept of E-
retailing has also been adopted by the conventional retailers.
The most successful internet retailers are those who are able
to successfully transfer the element from traditional retailing
to the internet. The paper has been pioneering effort in
understanding E-retailing concept. The key focus of the
paper was to nurture the retail online sector.
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Chris Nickson (2015) in his topic on “Has Online Shopping
made Lifestyle Easier” has discussed about the widespread
adoption of home computers and high-speed broadband
connections due to retailers offering goods online, having
created a kind of shopping revolution. Online shopping has
offered immense choice for the buyers. The researcher also
felt that online shopping will not ever completely eliminate
its physical counterpart. There are still people who prefer to
go to shop and buy their goods.
Tabata Baei et al (2005) the article on the topic traditional
shoppers and online shopping speaks about the positive
attitude of offline consumers towards online shopping. The
purpose of the article was to examine the online shopping
behaviour of consumers who still shop from traditional
stores besides the numerous benefits of online shopping
.Online shopping is a new experience and has greatly
impacted the life of consumers within a short period of time.
According to the author it is expected to grow in years to
come with advancement in technology.
Kataweta warak et al (2011) on the topic "online shoppers
behaviour; influences of online shopping decision studied
online shopping behaviour" found that online shopping
provides more satisfaction to modern consumers. The study
first provided a theoretical and conceptual background that
gives the difference between offline and online consumer
behaviour process. The study provided an overview of
online shopping decision process by comparing the offline
and online decision making and identifying the factors that
motivate the online customers to decide to buy or not to buy
online.
Dhorety Neil et al (2010) in their article "Internet retailing;
the past the present and the future". found that electronic
intermediaries have played an increasingly important role by
making, ‘one-to-one' marketing a reality, competitive prices
and perhaps most importantly made the consumer more
powerful. After going through the growth and impact of
online shopping, it concluded that the study has sought to
highlight key issue and raised question that should hopefully
provide an important of departure for future studies.
Data Analysis and Interpretation
A retailer survey was conducted by interacting with them to
know the impact of online shopping on their business and to
find out how they face such competition.
A survey was conducted on 100 retailers out of which a
major portion in the Salcete taluka i.e. 34 retailers, followed
by 19 retailers in Canacona, 17 in Quepem and the
remaining 30 in Vasco and Sanguem. The data was
tabulated and analysed with the help of SPSS software.
Various tables and graph are projected that will make the
analysis easy to evaluate. Each question of the questionnaire
was analysed in detail to reveal vital facts of the findings.
The analysis and its interpretation are as follows:
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Table No. 1 Table showing Age of the samples Years of business Frequency Percentage
Less than 1 year 9 9.0
Between 1- 10 years 46 46.0
Age of Respondents
Frequency Percentage Between10 - 20 26 26.0
20-30 19 19.0 years
More than 20 years 19 19.0
31-40 48 48.0 Total 100 100.0
41- and above 33 33.0 stores and 7% others, which were selected at random after
Total 100 100.0 considering the prevailing trend of customers in the market.

Source: Primary Data Table No.4 Table showing years of business of the
sample
The table No.1 shows that the majority of the respondents
(48%) belong to the age group of 30-40 years whereas 33% Source: Primary Data
belong to the age group of 41 and above and the remaining
19% belongs to the age group of 20-30 years. The above table presents the number of years retailers are
into business. The average experience for doing business of
the sample considered comes to 20 years.
Gender Frequency Percentage
Table No. 5 Table showing Profit before Online Business
Male 66 66.0

Female 34 34.0 Profit margin

Frequency Percentage
5-10% 40 40.0
Total 100 100.0
10-15% 45 45.0
Table No.2 Table showing Gender of the respondents
15% and 15 15.0
Source: Primary Data above
According to Table No.2, it can be noted that most of the Total 100 100.0
sample interviewed were males which accounts for 66% and
the remaining 34% were females, which leads to a Source: Primary Data
conclusion that the involvement of females in the retail
business is less as compare to males. Before the introduction of online business the profit margin
of the retailers was reasonable i.e. on an average 15% and
Table No.3 Table showing Nature of business of the above. This was fairly a good return on investment after
respondents meeting all the expenses.

Table No.6 Table showing whether it is Profitable to sell

at Online Prices
Nature of the business Frequency Percentage
General stores 23 23.0
Profitable to
Electronics 24 24.0
sell online Frequency Percentage
Grocery 5 5.0
Yes 20 20.0
Garments 20 20.0
No 80 80.0
Pharmaceutical 14 14.0
Total 100 100.0
Book Store 7 7.0
Source: Primary Data
Others 7 7.0
Total 100 100.0 Generally online prices are lower than the offline retail
Source: Primary Data business prices due to various reasons. When asked whether
they would like to sell the product at online price, majority
The retailer surveyed for the purpose were : 24% of them replied negatively because it not a profitable idea.
electronics, 23% general stores, 20% garments, 7% book

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Table No 7 Table showing Impact on Business Table No.10 Table showing Remedies taken by
Respondents
Remedies taken
Impact on business
Frequency Percentage by respondents Frequency Percentage
Yes 67 67.0 Reduce 43 43.0
prices
No 33 33.0
Total 100 100.0 Gift and 40 40.0
offers
Source: Primary Data
Home 13 13.0
According to (Table No.7) majority of the samples i.e. 67% delivery
agreed that their business has been affected by online Any other 4 4.0
shopping. The fact is that consumers are aware about the Total 100 100.0
various online stores and their attractive prices and great Source: Primary Data
discounts. This makes them to purchase online rather than to
buy from the traditional retailers who quote a higher price The above table shows (i.e. Table No.10) undertaken the
than the online retailers. This has affected their business to a remedies taken by conventional retailers. The competition
large extent. faced by the conventional retailers due to online business is
Table No. 8 Table showing effect on sales of the increasing as a result some retailers take remedies to face
Respondents such competition. 43% of the retailers reduced their prices,
40% give gifts and offers, 13% provide home delivery and
Effect on the remaining
sales Frequency Percentage
Yes 67 67.0 Table No.11 Table showing reasons behind low prices of
online products
No 33 33.0
Total 100 100.0 Reasons behind low prices Frequency Percentage
Cheap Quality products 55 55.0
Source: Primary Data
Second hand product 13 13.0
As can be seen in the above table (Table No.8) 67% of the
respondents agreed that their sales have decline due to Less number of middle 27 27.0
online shopping. man
Any other 5 5.0
Table No.9 Table showing Problems faced by the Total 100 100.0
Retailers
Source: Primary Data
In the survey conducted, 55% of the respondents responded
Problems faced by cheap quality products to be the reason behind low prices of
respondents Frequency Percentage online products. Around 27% of the respondents were of the
Less profit 80 80.0 opinion that prices of online products are low due to less
Increasing Debt 14 14.0 number of middle men, whereas 13%were of the view that
Verge of 6 6.0 the prices are low due to selling of second hand products
Closure (Table No.11).
Total 100 100.0
Table No. 12 Table showing Effect of Competition
Source: Primary Data
Effect of competition
Frequency Percentage
The above table shows that the impact of online business in
terms of profit, debt and its future. Majority of the Yes 83 83.0
respondents were of the opinion that their profitability has
been affected to a large extent followed by increase in their No 17 17.0
debt. Some they were even thinking to close down their
business due to stiff competition Total 100 100.0

Source: Primary Data

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Majority of the respondents were from the age group of 31-
The above figures show the responses of retailers whether 40 years out of which 51% do not shop online. Most of the
online shopping has increased competition for them or not.
Table No.13 Table showing Reasons for Online
83% are in favour that competition has increased on account
Shopping
of online shopping. Wherein 17% felt that there is no
competition. Reasons people shop
online Frequency Percentage
Table No.13 highlights retailer’s opinion as to why Low prices 40 40.0
consumers shop online. Out of the 100 retailers interviewed, Time saving 19 19.0
40% considered lower prices to be the main reason, 28% Variety of 13 13.0
said that lower prices, time and variety of products are the Products
reason for people to shop online, 19% were of the opinion All of the above 28 28.0
that the time was the main reason and the remaining thought
Total 100 100.0
that variety of products played a major role. In any case, the
benefit available to customers may be low prices, variety of respondents had a profit margin of 10-15% before the
products, saving in time are the main reasons for online introduction of online shopping. However emergence of
shopping by the customers. online shopping affected their business profitability. Many
retailers (67%) turnover had decreased after the emergence
Table No. 14 Table showing intention to convert Offline of online shopping despite the fact that 19% have
to Online business established their business for more than 20 years. Almost all
the retailers that is 83% were facing growing challenge on
Like to convert offline account of online shopping of whom the electronic retailers
stores Frequency Percentage and garment retailers have been severely affected. 62% of
Yes 48 48.0 the retailers still felt that people prefer personal shopping so
they do not consider it profitable to sell their products at
online prices. More than half of the retailers used sales
No 52 52.0 promotional techniques to attract customers like reduction in
Total 100 100.0 prices, gifts and offers, home delivery etc. The 38%
retailers, who were of the opinion that people prefer online
Source: Primary Data shopping, felt that low prices, variety of products and time
saving are the main factors for people to shop online. Cheap
After the introduction of online shopping, traditional quality products was the main reason that 55% of the
retailers face number of problems such as less profit. 48% of retailers felt that online prices are low. Despite people
the retailers were of the opinion that in future they would switching from offline shopping to online shopping, most of
like to convert their retail store into online store. However, the retailers would not like to convert their retail stores into
majority of them still wants to continue with their traditional online stores.
way of selling the products.
Suggestions
Due importance should be given to customers and their
Table No.15 Table showing Shutting down of
basic needs should be taken care of. Retailers should offer
Offline business in Future
gifts and discounts facilities during festival season. There
should be adequate sales girls/boys to attend the customers.
Shut down of Retailers should keep reasonable price for the product.
business Depending upon the type of outlet home delivery option
Frequency Percentage
should be available. General stores should keep the stock
Yes 45 45.0 available as insufficient stock leads to decrease in the
number of customers. Retailers must not stick to one type of
sales promotion techniques but try and adopt different
No 55 55.0 techniques.
Total 100 100.0 Retailers should treat each and every customers same way
and give equal attention irrespective of their status. Create
new opportunities for customers to purchase more
Source: Primary Data
frequently from the stores. Retailers should also keep goods
return policies and cash back offer. Use suggestion box,
Though there is competition, profits are decreased sales are
extend store hours and accept plastic money without any
affected due to online business majority of the retailers still
extra cost. Trial facilities should be provided on
want to continue in the same spirit.
clothing/footwear by all the websites. Fast delivery or
shipping of products may interest more customers. The
Conclusion and Suggestions
exact date of delivery should be given. There should not be

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hidden charges. Conventional retailers have no online
shopping facilities. So it will be better if they have it in
order to keep up with market competition. People fear of
hack or fraud as far as using credit or debit card is
concerned, so more security should be provided.
Ø Saha, S. and Rathore, A. (2014). An Overview of
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India. http://www.Scribd.com/doc/233176237/An-
Overview-of-Changing-Trend-of-Traditional-Retailing-
to-i-retailing-in-India.(accessed on September 2015)

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