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INTRODUCTION
1.1 INTRODUCTION OF THE STUDY
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the stage of receiving the stimuli and responding to it, the consumer goes through
the process of making his decision
This research has been conducted to gain an insight into the online
buying behavior of consumers. The objective is to explore the factors which
influence online purchase, the psychographic profile of the consumer groups and
understanding the buying decision process.
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1.2 OBJECTIVES OF THE STUDY
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1.3 SCOPE OF THE STUDY
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1.4 RESEARCH METHODOLOGY
We will attempt to find the main factors that influence the online
consumer when making an online purchase. In order to broaden our own
understanding of the subject we conducted our research in literature on consumer
behaviour and e-commerce. We reviewed studies that had similar aims and paid
particular attention to their results.
Research method
Primary data
Secondary data
Primary Data
Data comes from primary source is called primary data. It is direct data.
In this study data the main source of data is;
Structured questionnaire
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Secondary Data
Sample Size
Sampling Method
For this study decided to apply convenience sampling technique for the
purpose of collecting empirical material. Convenience sample is one that is
conveniently available to the researcher with its goodness of accessibility
Percentage Analysis
Tables And Graphs
Chi-Square Test
ANOVA
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1.5 LIMITATIONS OF THE STUDY
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CHAPTER SHEME
1. Introduction
This chapter devotes attention to describe the topic taken for the study,
objectives of the study, research methodology, and the limitations of the study.
2. Review of Literature
3. Theoretical Background
This chapter deals with the theoretical aspects of consumer behaviour and
ecommerce.
Simple statistical tools are used to analyze the data. Data are analyzed on
the basis of responses received from the respondents.
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CHAPTER 2
REVIEWOF LITERATURE
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Abel Stephen (2003) in his paper represents the findings of
research studies that address e-commerce design and associated consumer
behavior. The innovation of e-commerce has affected not only the marketplace
through the facilitation of the exchange of goods and services, but also human
behavior in response to the mechanisms of online services. Researchers have
identified and hypothesized on relevant subject matters ranging from Web
usability, marketing channels and other factors influencing online buying behavior.
Though researchers have focused on what appear different aspects of online buying
behavior, their studies may be shown to be interrelated and interdependent, even to
the extent of revealing constructs upon which e-commerce, in terms of future
design and research, could be built.
Rajeev Kamineni (2004) in his study finds that World Wide Web
can change human behavior and human interactions to a very large extent. Web
based shopping behavior is one major example to point out the trends in this
direction. This study is of a very exploratory nature and it intends to establish the
differences between several web-based shoppers from different parts of the world.
Several critical factors associated with online shopping behavior have been
explored. A cross cultural data set has been collected and an illustrative description
of the shoppers has been provided. As a final step the cross cultural differences
between several shoppers explored.
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A survey undertaken by JuxtConsult, (April 2007), a Delhi-based
online research firm, on 10,000 households in 31 cities (of population sizes 20,000
plus) revealed some interesting facts about the Internet shopping scenario in India.
As per research findings, eBay (excluding online travel websites) is the most
preferred site for online shopping followed by Rediff, Google and Yahoo. eBay
leads with 34 per cent online shoppers still preferring to visit it the most. Rediff
follows at the second spot with 25 per cent online shoppers preferring to visit it.
However, both eBay and Rediff have lost usage share on preferred basis in the last
one year, while new entrant Futurebazaar along with Google have been the biggest
gainers. The top two of the top 10 products bought on the Net by online buyers are
train tickets (53 per cent) and air tickets (45 per cent). The research also showed
that three-fourth of all regular online Indians (76 per cent) search for products and
services online. This has shown a 60 per cent growth in the base of online shoppers
in last one year, making it 19.1 million. When it comes to the base of actual online
buyers, 43 per cent of all regular online urban Indians have bought online. This
means a growth of 76 per cent over the last year, making the online buyer base
reach a healthy 10.8 million mark. Despite such tremendous growth in the number
of online buyers overall, the base of really „active‟ online buyers (those who buy
online at least once a month) is almost stagnant at 2.2 million (same as last year).
However, the fact that online buying is penetrating among the smaller towns and
lower section groups do not necessarily mean that the economic profile of the
online buyers is lowering. The biggest „qualitative gain‟ about online shopping is
its improved perception on highly important and hardcore „market place‟ factors
like „wider choice and availability of products‟ and „better prices and bargains‟,
and not just on the „convenience‟ factors like saving of time and efforts, home
delivery and flexibility of buying anytime. Yet „product quality‟ and „delivery‟
concerns may be negating some of the gains made. Though misuse of a credit
card‟ is a non-issue among online buyers, the research reveals that „lack of a credit
card‟ is still a strongly perceived roadblock to growth of online buying.
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Singapore, South Korea, Thailand, UAE and South Africa, revealed that Online
shopping in the Asia-Pacific region is accelerating at an annual rate of 23.3 percent
to hit US $168.7 billion by 2011, with the region's new markets such as China and
India fuelling this growth. MasterCard Worldwide published its latest Insights
Report, “Economic Crisis and Preference for Online Shopping in Asia/Pacific,
Middle East and Africa”, which shows that in India the average frequency of
online purchases increased to 2.9 in fourth quarter of 2008, up from 2.6 during the
same quarter in 2007. The survey showed that the Asia-Pacific region was found to
be an active one for online shopping, where 76 percent of respondents said they
intend to make a purchase in the next six months. The survey also highlighted the
rise of shoppers in the fast-growing markets of China and India. The rising
population of upper middle income urban elites is likely to boost the online
shopping markets in China and India underpinned by a paid pace of urbanization,
robust economic expansion and rising spending power. Activity from these
markets is expected to topple the current "preeminence" of Japan and South Korea
in terms of share of the total online.
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CHAPTER 3
THEORETICAL BACKGROUND
3.1 CUSTOMER BEHAVIOUR
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beginning at the production level, to the end of the cycle, the consumer (Kioumarsi
et al., 2009).
Consumer decision process carries five stages, starting with Problem recognition
and following Information search, Evaluation of alternatives Purchase decision and
finally Post Purchase behavior. Problem recognition starts with the perception of
need and moves towards information search where consumer uses internal and
external sources to analyze given information and use that information in the next
step of evaluation of alternatives. While evaluating alternatives one assessing
values of the products by giving weights. Once you have successfully evaluated
alternatives you will move towards purchase decision where you may encounter
three possibilities, from whom to buy, when to buy and do not buy. Once you have
actually made the purchase now it comes to Post purchase behavior
3.3 E-COMMERCE
3.4 TIMELINE:
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1984: Gateshead SIS/Tesco is first B2C online shopping and Mrs Snowball, 72,
is the first online home shopper
1984: In April 1984, CompuServe launches the Electronic Mall in the USA and
Canada. It is the first comprehensive electronic commerce service.
1984: California becomes first US state to enact an Electronic Commerce Act
defining basic consumer rights online.[citation needed]
1990: Tim Berners-Lee writes the first web browser, WorldWideWeb, using
a NeXT computer.
1992: Book Stacks Unlimited in Cleveland opens a commercial sales website
(www.books.com) selling books online with credit card processing.
1992: St. Martin's Press publishes J.H. Snider and Terra Ziporyn's Future Shop:
How New Technologies Will Change the Way We Shop and What We Buy.
1992: Terry Brownell launches a fully graphical, iconic navigated Bulletin
board system online shopping using RoboBOARD/FX.
1993: Paget Press releases edition No. 3 of the firstAppStore, The Electronic
AppWrapper
1994: Netscape releases the Navigator browser in October under the code
name Mozilla. Netscape 1.0 is introduced in late 1994 with SSL encryption that
made transactions secure.
1995: The US National Science Foundation lifts its former strict prohibition of
commercial enterprise on the Internet.
1995: Thursday 27 April 1995, the purchase of a book by Paul Stanfield,
Product Manager for CompuServe UK, from W H Smith's shop within
CompuServe's UK Shopping Centre is the UK's first national online shopping
service secure transaction. The shopping service at launch featured W H
Smith, Tesco, Virgin Megastores/Our Price, Great Universal Stores
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(GUS), Interflora,Dixons Retail, Past Times, PC World (retailer) and
Innovations.
1995: Jeff Bezos launches Amazon.com and the first commercial-free 24-hour,
internet-only radio stations, Radio HK and NetRadio start
broadcasting. Dell and Cisco begin to aggressively use Internet for commercial
transactions.[citation needed]
eBay is founded by computer programmer Pierre
Omidyar as AuctionWeb.
1996: IndiaMART B2B marketplace established in India.
1996: ECPlaza B2B marketplace established in Korea.
1996: Sellerdeck, formerly Actinic, the UK's first PC/LAN e-commerce
platform established.
1998: Electronic postal stamps can be purchased and downloaded for printing
from the Web.
1999: Alibaba Group is established in China. Business.com sold for US $7.5
million to eCompanies, which was purchased in 1997 for US $149,000. The
peer-to-peer filesharingsoftwareNapster launches. ATG Stores launches to sell
decorative items for the home online.
2001: Alibaba.com achieved profitability in December 2001.
2002: eBay acquires PayPal for $1.5 billion.[13] Niche retail
companies Wayfair and NetShops are founded with the concept of selling
products through several targeted domains, rather than a central portal.
2003: Amazon.com posts first yearly profit.
2004: DHgate.com, China's first online b2b transaction platform is established,
forcing other b2b sites to move away from the "yellow pages" model.
2007: Business.com acquired by R.H. Donnelley for $345 million.
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2009: Zappos.com acquired by Amazon.com for $928 million.[16] Retail
Convergence, operator of private sale website RueLaLa.com, acquired by GSI
Commerce for $180 million, plus up to $170 million in earn-out payments
based on performance through 2012.
2010: Groupon reportedly rejects a $6 billion offer from Google. Instead, the
group buying websites went ahead with an IPO on 4 November 2011. It was the
largest IPO since Google.
2011: Quidsi.com, parent company of Diapers.com, acquired
by Amazon.com for $500 million in cash plus $45 million in debt and other
obligations.[20] GSI Commerce, a company specializing in creating, developing
and running online shopping sites for brick and mortar businesses, acquired
by eBay for $2.4 billion.
2012: US e commerce and Online Retail sales projected to reach $226 billion,
an increase of 12 percent over 2011.
2012: US e commerce and Online Retail holiday sales reach $33.8 billion, up
13 percent.
2013: Blucora, Inc. (NASDAQ:BCOR) buys Monoprice, an online provider of
self-branded consumer electronics and accessories in an all-cash transaction of
$180 million.
2014: India’s e-commerce industry is estimated to have grown more than 30%
from a year earlier to $12.6 billion in 2013.
2014: All the e-commerce websites provide or felicitate mobile applications
for buying and selling
2015: in the month of January the use of mobile phones are 15% increase.
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3.5 TOP ECOMMERCE COMPANIES IN THE WORLD
Amazon.com
It is the largest internet based retailer in the U.S. the company was
established in 1994.initially it sold books online.
JD.com Inc.
EBay Inc.
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Otto Group
Cnova N.V
Tesco PLC
Rkuten
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3.6 FACTORS INFLUENCING ONLINE SHOPING AMONG
CUSTOMERS
Convenience
Time saving
Website design/features
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reliability/fulfillment, website customer service and website security/privacy are
the most attractive features which influence the perception of the consumer of
online buying. The higher website quality, the higher consumer intends to shop
from internet.
Security
Security is another dominant factor which affects consumers to
shop online. However many internet users avoid online shopping because of credit
card fraud, privacy factors, non delivery risk, post purchase service and so on. But
transaction security on the online shopping has received attention. Safe and
secured transaction of money and credit card information increases trust and
decreases transaction risk.
Demographic factors
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CHAPTER 4
DATA ANALYSIS AND INTERPRETATION
Table - 1
No. of
Gender Percentage
respondents
Male 48 96
Female 2 4
Total 50 100
(Source: Primary Data)
.Figure – 1
Gender
4%
Male
Female
96%
Interpretation:
The table exhibits that there were 48 male and 2 female respondents. This
means that out of total respondents 96% were males and only 4% were females.
This indicates the very low participation of female customers in e-commerce.
Thus it is evident that female are not much attracted to the online shopping
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Table - 2
No. of
Age Percentage
respondents
Below 20 2 4
20 – 50 46 92
Above 50 2 4
Total 50 100
(Source: Primary Data)
Figure – 2
Age
4% 4%
Below 20
20 - 50
Above 50
92%
Interpretation:
The table shows that 92% of the respondents are aged between 20-50 years and
only 4% respondents were aged below 20 and above 50.
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Table - 3
Married 10 20
Total 50 100
Figure – 3
Marital status
20%
Single
Married
80%
Interpretation:
The table 3 exhibits that the majority of respondents (80%) were unmarried. It
is further revealed that percentage of unmarried respondents is greater than married
respondents.
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Table - 4
NIL 7 14
Total 50 100
(Source: Primary Data)
Figure – 4
Monthly income
14%
34%
Interpretation:
Table 4 exhibits that monthly income of majority of the respondents was less
than Rs.50000, the income of 18% of the respondents was above Rs.50000 and
14% of the respondents were not earning.
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Table - 5
No. of
Responses Percentage
respondents
Yes 50 100
No 0 0
Total 50 100
(Source: Primary Data)
Figure – 5
Usage of internet
0%
Yes
No
100%
Interpretation:
Table 5 shows that 100% of the respondents are using internet regularly.
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Table - 6
No. of
Responses Percentage
respondents
Yes 40 80
No 10 20
Total 50 100
(Source: Primary Data)
Figure – 6
E-banking usage
20%
Yes
No
80%
Interpretation:
Table 6 exhibits that 80% of the respondents are using e-banking and only 20%
of respondents do not use e-banking.
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Table - 7
Yes 17 34
No 33 66
Total 50 100
(Source: Primary Data)
Figure - 7
34%
Yes
No
66%
Interpretations:
Table 7 shows demonstrate that majority of the respondents are not using credit
card. Only 34% of the respondents are using credit cards.
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Table - 8
No. of
Items Percentage
respondents
Apparels 12 14.11
Books 17 20
Gifts 7 8.23
Tickets 18 21.17
Others 2 2.35
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Figure – 8
Others 2.35
Tickets 21.17
Gifts 8.23
Books 20
Apparels 14.11
Interpretation:
Table 8 clearly shows the products which are purchased by respondents through
internet. From the table it is clear that electronic products, Tickets and books are
purchased more by respondents. Only a very few customers depend on online
shopping for other type of products.
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Table - 9
No. of
Response Percentage
respondents
Yes 50 100
No 0 0
Total 50 100
(Source: Primary Data)
Figure - 9
Yes
No
100%
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Table - 10
Rs.500 – Rs.1000 19 38
Rs.1000 – Rs.2000 12 24
Rs.2000 – Rs.5000 10 19
>5000 7 14
Total 50 100
Figure – 10
Interpretation:
The table 10 clearly shows that 38% of the respondents spend average amount
of Rs.500 – Rs.1000 for making online purchases. Only 5% purchases below
Rs.500 and the remaining respondents purchase products cost more than Rs.1000.
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Table - 11
www.amazon.com 10 18.18
www.ebay.com 5 9.9
www.flipkart.com 20 36.66
www.myntra.com 10 18.18
www.indiatimes.com 5 9.9
Other 5 9.9
(Source: primary data)
Figure – 11
10%
18.88%
9.9% Amazon
e-bay
9.9% Flipkart
18.88% Myntra
India times
OTHER
36.66%
Interpretation:
From the table 11 it is clear that the most used website is flip kart. Myntra,
Amazon and e-bay are also mostly used by the respondents.
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Table - 12
Net banking 33 36
Credit card 12 13
Debit card 21 23
Cash on delivery 26 28
Figure – 12
28%
36% Net banking
Credit card
Debit card
Cash on delivery
23%
13%
Interpretation:
The table 12 exhibits that the mode of payment selected by the majority of
respondents was internet banking and cash on delivery. Only 36% of the
respondents select debit card and credit card as their mode of payment.
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Table - 13
No 2 4
Total 50 100
Figure – 13
4%
Yes
No
96%
Interpretation:
The table 13 reveals that 96% of the people were confident regarding the safety
of purchasing products online. Only a very few were not sure about the safety of
online shopping.
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Table - 14
Yes 48 96
No 2 4
Total 50 100
Figure – 14
4%
Yes
No
96%
Interpretation:
The table 14 indicates that 96% of the respondents are positively answered as to
the quality of the products purchased through online. However, 4% respondents
are of the opinion that the quality of the products purchased through online is not
up to the mark.
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Table - 15
Yes 36 72
No 14 28
Total 50 100
Figure – 15
28%
Yes
No
72%
Interpretation:
As data shown in table 15, respondents give 72% positive reply regarding the
superiority of online purchases over other purchase models.
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Table - 16
Yes 48 96
No 2 4
Total 50 100
Figure - 16
4%
Yes
No
96%
Interpretation:
The table 16 exhibits online shopping saves time than in-store shopping. From
the 50 respondents 48 answered online shopping saves time.
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Table - 17
Yes 14 28
No 36 72
Total 50 100
Figure – 17
28%
Yes
No
72%
Interpretation:
As shown in table 17, 72% of the respondents feel comfortable to buy all types
of products online. However, 28% of them feel it is not convenient to purchase all
types products online.
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Table - 18
Yes 31 62
No 19 38
Total 50 100
Figure – 18
38%
Yes
No
62%
Interpretation:
Respondents were also asked about the safety regarding online payment
especially with regard to usage of credit card. Survey shows that about two third
of the respondents are of the opinion that payment using credit card is safe. On the
other hand one third of the respondents are doubtful about the safety of credit cards
for payment.
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Table - 19
No 33 66
Total 50 100
Figure – 19
34%
Yes
No
66%
Interpretation:
The researcher also enquired whether there are any defects associated with the
online purchasing. As per the data given in table 19, two thirds of the respondents
are confident about this new model of purchasing. They says that there are no
much defects connected with online purchasing.
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At the same time 34% of the customers mentioned certain defects. The
important among them are the following:-
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Table - 20
Bad 0 0
Good 29 58
Average 14 28
Excellent 7 14
Total 50 100
Figure – 20
10% 28%
0% 0% 14%
Bad
Good
Average
Excellent
Interpretation:
According to this score, it can be interpreted that 58% of the respondents reply
good as the quality of products and the remaining as average and excellent. But
not even a single person give a negative report regarding the quality of the
products.
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Table - 21
Figure – 21
Interpretation:
From the table 21 it clearly shows 86% of the respondents say that the price of
the products purchased online are reasonable which means majority of online
customers are satisfied with the price. But a very few argues that the price is high
in online shopping.
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Table .23
ANOVA TEST
Food
Electronic Pharma
Age and apparels Book Gift Ticket car others
products ceutical
beverage
Below
0 0 0 1 1 0 0 0 0
20
20-50 2 8 5 10 6 10 2 2 1
Above
0 0 0 1 0 0 0 1 0
50
Table 24
ANOVA TABLE
SUM OF SUM OF
DEGREE MEAN SQUARE
VARIENTS SQUARE
Between sample SSC=40.8133 K-1=8 MSC=5.10
Within sample SSE=218.6867 N-K=19 MSE=27.34
Total SST=259.5 N-1=26 F=0.18
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Table 25
CHI-SQUARE TEST
INTERPRETATION
Calculated value is greater than table value so we accept the null hypothesis.
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CHAPTER 5
FINDINGS, SUGGESTIONS & CONCLUSION
FINDINGS
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The mode of payment selected by the majority of respondents was internet
banking and cash on delivery. Only 36% of the respondents select debit card
and credit card as their mode of payment.
Majority of the people was confident regarding the safety of purchasing
products online.
The quality of the products purchased through online is good.
Online purchases are superior to other purchase models.
Online shopping saves time than in-store shopping.
It is comfortable to buy all types of products through internet.
About two third of the respondents are of the opinion that payment using
credit card is safe.
The quality of the products purchased through internet is high.
Majority of online customers are satisfied with the price of the products
purchased online.
50% of the respondents are now using online shopping at the same time 50%
are also using traditional shoping.
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SUGGESTIONS
Consumers should be educated on online shopping procedures with proper
steps to be following while online shopping.
Banking should promote Debit card, Credit card facility in online shopping.
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CONCLUSION
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APPENDIX
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QUESTIONNAIRE
1. Name:
2. Gender: Male Female
3. Age a) Below 20
b) 20 – 50
c) Above 50
4. Marital status: a) Single
b) Married
5. What is your monthly income?
a) Below Rs.25000
b) Rs.25000 – Rs.50000
c) Above Rs.50000
6. Do you use internet regularly? Yes No
7. Do you use E-banking? Yes No
8. Do you own a credit card? Yes No
9. Which of the following type of products you buy through online?
e) Gifts f) Tickets
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11. What is the average amount that you spend for making online shopping?
a) < Rs.500 b) Rs.500 - Rs.1000
e) > Rs.5000
15. Whether you get quality products while purchasing online? Yes No
16. Do you think that online purchase is better than other purchases? Yes No
17. Do you think that online shopping saves time than in-store shopping?
Yes No
18. Is it convenient to buy all types of products through internet? Yes No
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19. Is it safe to use a credit card while shopping on the Internet? Yes No
20. Do you think that online purchases have any defects? Yes No
If yes specify them; _____________
21. How do you rate the quality of the product purchased online?
a) Bad c) Average
b) Good d) Excellent
22. In my opinion products purchased online are;
a) Low c) High b) Reasonable
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