Online shopping is a fast growing concept nowadays globally, and it is seen that number of online shops have been increasing and it is obvious that there has been an upward trend of consumers who opt online purchases rather than conventional shopping. A consumer group, which is designated as Millennials (Generation Y) has a huge market in online market, which alone will contribute in the success of online retailers in the future. As we see internet is widely used by people of this generation and in fact, they are more technologically savvy and people feel much comfortable in using this internet for a variety of purposes including online shopping. For more than two decades, this millennial consumers segment constitutes a major marketing segment in the global market place. This trend is attributed to the fact that the individuals in the age group are in great numbers and they have supreme purchasing power which in fact, surpasses any other group of consumers. For this study, a sample size of 132 was taken through probability sampling techniques.
In his study, Liang (2009) incorporated that online shopping holds a vibrant opportunity for the market of Generation Y (Gen Y); those who were born between 1978–1995. Evans’ (2010) study concludes that Gen Y is more financially sound than the average online buyers, and that makes them a repeated buyers. Millennial (characterized as those aged 18 to 34, according to Social Lens Research) comprises one-third of the adult population within the next five years whose lifestyle is characterized by technology. This group is considered as tech-savvy generation because of their ever-changing environment which has influence on their behaviour. Unstable financial market, expensive loan-backed degrees, recovering job market, etc., indulges them to stick to one another via mobile devices and social media. Due to the high disposal income, the millennial are demanding and driven in their behaviour and this reflects in the dominance in the retail market by which they have completely changed the game of e-commerce. The 18- 34 age group comprised of 26% of the population, are major contributors (35%) of retail spending and this becomes the pertinent target group for the retail merchants.
Online shopping or e-commerce is considered to be the face of this generation because of their high level of penetration. Millennial belong to the cohort group similar to Gen X and there has been no universally accepted age range for them. Various studies have adopted the people born in 1978 - 2000 as Millennial and this study too adopts the same. “Baby Boomers” or “Generation X” (born between 1946 and 1964) was being monitored closely by sociologists and researchers for their unique behaviors and attitudes and their behaviors were different from any other previous generations. Various researches were conducted and found that in an ever-changing living environment, these generation were regarded as fashion addicts and shopaholics, where their major junk of disposal income goes towards spending in fashion. Their high disposal income and attitude towards shopping made them to buy products through e-shopping. Their very attitude towards online shopping induced their shopping behaviour (Michael and Cheuvront, 1998) which alone differentiated the very pattern from previous generations (Wolburg and Pokrywczynshi, 2001, p. 40) and they were regarded as the potential consumers with high purchasing power.
Since the late 1990s, online shopping is in a robust growth because of the availability of the diversified products, and various research reports state that millennial group contributes an substantial share to the e-commerce purchasing. Some studies also reveal that an average consumer aged 18 to 34 invests $2,000 per year on digital retail sites and this proves that, in any given six month period, more than half of shoppers who make an online purchase are millennial.
Since last year, there has been a 32% upswing in mobile sales (m-Commerce), the perfect leather watch or shade of eye-shadow by the millennial thumbing through websites. This has become rule of their lives, transforming their shopping habits from the mall to the palm. They are also smarter than any other generation, as they prefer to use multiple devices and channels throughout their shopping experience, from researching a product to reading reviews, and finally clicking the purchase button (hopefully). Researchers have shown that smartphones are the most-used device because of their convenience of the apps and 79% millennial vouched that mobile devices introduced them to new brand or products and 54% said shopping apps easier to use than online sites.
Though there have been a revolution in mobile devices in online shopping still desktop computers are considered to be the king of online purchasing. Annalect survey of US revealed that most of the mobile devices used in online shopping are to browse and know the product, but the actual purchase happens via desktop. This is due to the convenience and the credibility of using a desktop computer, predominantly due to the ease of the checkout process than a phone or tablet. It is generally easier to navigate a check-out page with a mouse and type a sixteen digit credit card number on a physical keyboard than a small touch-screen. In a poll by LocoSpace and Social Lens Research, 35% of respondents said that they would buy products on their phone if the process was easier.
This clarifies that there seems to be a growing demand and wide open market for a streamlined mobile process to capture this unique consumer online purchasing behaviour. By-chance if the technology has evolved like one-tap payment process, the implementation of fingerprint scanners will completely reinstall the confidence of mobile buying process, making it a virtually unrecognizable process.
While millennial generation are still a young population, they are expected to grow up to the next generation of mass affluent investors, which again follow the current baby boomers ( Timmermann, 2007; Papini, 2007. Millennial generation were called as Millenial or echo boomers. This group comprised of individuals born between 1980 and 2000, came of age in the new millennium and was considered as the second largest age group behind baby boomers, born between 1946 and 1964 (Nickell, 2012). More than half of the Millennial were already voting aged adults.
The Millennial behaviors and preferences are different in kind or degree from previous generations at the same age and are likely to become part of their lifelong culture. Millennials love internet. In a survey conducted by Ipsos Mendolsohn, it was reported that they spend an average of almost 40 hours per week on the Internet, and 81 percent of them access social media on daily basis (Nickell, 2012). Millennials were characterized by Strauss and Howe (1991) as such they were cited as by Keeling (2003), as being protected by both their parents and society, because they were driven to improve the world around them by their virtue. This generation is “possessed of rational minds, a positive attitude, and a selfless team virtue”. Howe and Strauss used the following words to describe Millennials: optimistic, cooperative team players, rule followers, and racially and ethnically diverse. The Millennial generation has seven distinguishing traits: special, sheltered, confident, team oriented, achieving, pressured, and conventional. These traits alone make this generation unique and particularly make them different from Generation X (Keeling, 2003).
Sweeney (2006) found the following as the behaviours of the millennials: Millennials believed that choices and selectivity were their birth right. They always wished to have flexibility and convenience. Personalization and customization were preferred as the most important feature to meet their changing needs, tastes and interests. It was also seen that millennials have no tolerance and they wanted to do anything instantly. Millennials were always practical and much interested to have practical oriented solutions. They are multitaskers as they want to do many things at a time. Millennials are much digitial oriented as speed, convenience, and flexibility were their buzz words. Millennials spend their leisure time in playing games in thousands of hours. As millennials have more friends, they preferred to communicate with others through nomadic communication style. They are always collaborative and intelligent and as such they know how and when they have to work with the people more effectively in a balanced way. It was also seen that they have very less reading habit. They want to know anything in brief, but not in an elaborate way.
Recent times have demonstrated an upswing in Online retailing space which is still a long way ahead for India to match the global standards (Jadhav and Khanna, 2016). Market is the place where the transaction between sellers and buyers happens. The market provides benefits for sellers as a source of income, and for the buyers as a fulfillment of needs and desires. There are two types of markets, modern markets and traditional markets (Sutami, 2012). The Distribution chain in the traditional market consists of manufacturers, distributors, retailers, and consumers (Sinaga, 2008).
There are some differences between traditional markets and modern markets. In terms of physical condition, modern market has a permanent building, with adequate and comfortable facilities, and supports consumers in shopping, while traditional market has a temporary, semipermanent, or permanent building. Based on the method aspects of the service, in traditional markets, sellers serve buyers, while in the modern market, customers serve themselves (self-concept). Based on transaction, in traditional markets, buyers and sellers bargain each other to get deal price, in modern market, buyers get the certain price. Based on the management aspects, traditional markets sometimes are not professionally managed, less convenience to shop, while modern markets are managed more professionally so that consumers enjoy to do shopping (Poesoro, 2007). Based on the payment aspect, modern market accept payment in cash or noncash (Debit or credit cards), while the traditional markets accept payment only in cash. Davis (1989) suggested in his article that the attitude of using the information system is determined by perceived usefulness and perceived ease of use (both of them are users' beliefs toward the system). Perceived usefulness refers to "the degree to which an individual believes that using a particular system would enhance his or her job performance" while perceived ease of use refers to "the degree to which an individual believes that using a particular system would be free of physical and mental effort". Both perceived usefulness and perceived ease of use are directly influenced by design features that the same affect the attitude and behavior of Millenials indirectly. According to Featherman and Pavlou (2003), millenial generation would likely to play a significant role in their marketing and advertising in the twenty first century (Cui et al., 2003, p. 311). In this regard, the millenial college going students are the most important consumer group who have unique purchasing behavior (Arnaudovska et al., 2010), and these groups generally have high positive attitudes towards shopping online ( Engel et al., 2011 ; Xu and Paulins, 2005). Thus these millennial college students buy the things online more than the general population, and frequently spend money on clothing, computer software, books, event tickets, music, flowers, airline tickets, hotels, etc. (Comegys and Brennan, 2003).
Kansra and Rajiva (2013) made an attempt to analyze the perception of the young people towards online shopping in Punjab. For the analysis of data, descriptive statistics have been applied. Majority of the respondents assumed that transaction security, personal privacy, product price, product quality, convenience, accessibility, promotions and advertisement, delivery time, quality comparison and reputation of the company are the important variables in online shopping. With the growth of online shopping, there are various opportunities and challenges to online business retailers and consumers. If the online business retailers want to grow then they have to consider all these factors. They also made a study that aimed to explore the factors influencing the college students, to purchase products and services from the online retail stores. Qualitative research using the focus group methodology was used in this exploratory research. Content analysis method was used to analyse the transcribed data. The data analysis procedure resulted in six factors, namely (i) Low Prices; (ii) Variety; (iii) Time Consciousness; (iv) Convenience; (v) Promotions, and (vi) Comparison; which influenced the college students to shop from the internet stores. Overall, the results of this study provides online retailers and marketers with a better understanding of college students' online retail buying behavior which will help them to design their marketing strategies to enable them to give enough competitive advantage. This study contributes to the existing research in the area of online retail buying behavior in India.
Ashwini and Manjula (2015), in their paper, ‘An Empirical Study on Consumers Perception towards Online Shopping’ aimed at understanding the key motivators for consumers to search and shop online. They also investigated how different types of online buyers perceive website differently. The growing use of internet is providing a greater developing prospect for e-Marketers. With the growth of technology, they are making shopping more convenience from home which is a main factor that drive the consumers for discounts after sale services. The survey identifies the factors that influences online shopping through various marketplace. This research focuses on factors which the buyers keep in mind while shopping online. If e-marketers know the factors affecting online buyers behavior, and the relationships between these factors and the type of online buyers, then they can further develop their marketing strategies to convert potential customers into active ones, while retaining existent online customers.
Kim (2014), in his paper explored how interactive product virtualization technologies (i.e., interactive product simulator) can engender virtual product experiences, affecting Millennium generation shoppers' use of interactive product simulators for online shopping. Through an online survey, the researcher identified perceptions of using interactive product simulators for online shopping. The research focused on Millennium generation, considering their high Internet usage levels, strong social ties, and interdependency among millennial shoppers through social media. Based on Diffusion of Innovation, Theory of Reasoned Action, and Technology Acceptance Model, the research model was developed. The effects of object interactivity and beliefs on attitudes towards using interactive product simulators for online shopping as well as the effect of subjective norm on the intention to shop online using interactive product simulators were investigated. Potential gender difference in the relationships among the variables in the model was also examined.
Online shopping has become a monolithic way of purchasing in recent times. Millennial are vivacious in online shopping because of two reasons; first, the potential of earning heftier income than other generations and second the enthusiasm they posses towards shopping and ever changing technology. Attitude forms the key component apart from other driving forces in online purchasing. This forms the vitality to comprehend the association between attitude and online shopping behaviour with the apprehension of understanding various other factors which influence the online shopping behaviour especially among millennial.
In this research, Descriptive research as well as Exploratory research designs were used to find out what are the factors that influence consumers to shop online. In general, two types of research methods, say quantitative and qualitative methods are being used.
Probability sampling techniques were employed for the current research. In Probability sample technique, a nonzero equal chance is given for each population element to be selected. Simple random sampling were adopted for this research with a sample size of 132.
Millennial consumers, most of them are college going students have been widely administered.
The data for the survey was collected through Primary method as well as Secondary method. The Questionnaire was used to collect Primary data, and the Secondary data was collected through Epsco, J-gate, and other reliable Internet sources. Of course, the questionnaire was administered to 132 respondents belonging to the millennial group.
The Constructs and Sources are given in Table 1.
Table 1. Constructs and Sources
The questionnaire is tested with a small sample of 35 millenials. The realiability and validity test is carried out to get the Cronbach’s alpha value, Here the Cronbach’s alpha value for the 35 items is 0.856. According to Sweet and Grace-Martin (2008), the alpha value of more than 0.7 is an acceptable value which indicates the high reliability.
Correlation Analysis, Regression and ANOVA tools were used.
H1: There is significant relationship between the various factors (Perceived Usefulness Perceived Ease of Use, Trust, Social Influence, Perceived Behavioural Control, Website Quality, Intention to Adopt) that influence the online shopping behavior of millennial.
Table 2 gives the inter correlation coefficient value for the factors that influence online purchasing behavior of millennial. Since all the p values are less than 0.01 (1% significant level) the null hypothesis is rejected and the real time hypothesis H1 is accepted. Among the r values, the highest r value is (.908) for the perceived usefulness, and perceived ease of use show the 90% positive relationship whereas the lowest r value is (.098) for the intended use and perceived behavioral control show the least 9% positive relationship among the dimensions taken for the study. The remaining r values for the other dimensions are greater than 0.4 which indicates the existence of more than 40% positive relationship.
Table 2. Pearson Intercorrelation Coefficient
Since the F value (110.891) is greater than 1 (Table 3), the hypothesis H1 is accepted and thus there is significant relationship between the various factors (Perceived Usefulness (PU), Perceived Ease of Use (PEU), Trust (T), Social Influence (SI), Perceived Behavioural Control (PBC), Website Quality (WQ), Intention to Adopt (IA)) that influence the online shopping behavior of millennial.
The R value (.918) and the adjusted R square value (.835) of Table 4 indicate that the model is the best model to predict the significant relationship between various factors (Perceived Usefulness, Perceived Ease of Use, Trust, Social Influence, Perceived Behavioural Control, Website Quality, Intention to Adopt) that influence the online shopping behavior of millennial.
Table 4. Regression
Ordinary Least Square (OLS) Equation Model is given by,
(1)
The above analysis shows that the factors, such as perceived usefulness, social influence, and web quality have a positive impact on intend of use and adopt whereas the remaining factors have negatively influenced the model.
Now, the standardized (normalized) OLS equation will be:
(2)
The co-efficient table (Table 5) shows that the factors social influence (b = 0.783, t = 8.345, p < 0.001) and website quality (b = 0.725, t = 8.583, p < 0.001) have positive relationship and is statistically significant and therefore both the factors help to predict to Intention of use and adopt online shopping.
Table 5. Coefficients
(i) Smartphone plays a vital role as a connecting tool towards internet. This is proved by the research which states that 89 percent of millennial are using Smartphone to connect to web. Other connecting tools are comparatively less than that of a Smartphone, viz., only 75 percent use laptops, 45 percent use tablets, and 37 percent use desktops to connect to web. This makes the retailers to formulate a mobile first strategy to stay ahead of competitors.
(ii) Social media is the mother for all shopping information. Millennial are actively vibrant in social media groups where they share their views and obtain information about various products, special deals connected to online shopping. The research also suggests that digital advertising methods outreach the target audience than that of traditional methods of advertising like television, print media. This prompts the retailers to inculcate the digital media in their promotional strategy if not fully replacing traditional advertising strategy.
(iii)Millennials are sensible towards price. In-spite of being tech-savvy, shopaholic, media-buff, they are biased towards price which plays a major role in purchasing decision than any other factors like quality, brand, store and availability. Online purchasing typically reacts less towards price, but the attitude of millennial is other way round by instantly comparing the price with competitors and save as much as possible in anything they buy.
(iv) Flipkart, Amazon, and Google are considered to be favorites for prize comparison. Studies illustrate that on an average Flipkart (41 percent), Amazon (36 percent), and Google (23 percent) are utilized as a price comparison agent by the millennial, especially for smartphones. This authenticates that in order to compete with online shopping, retailers should price on par with online and provide more value than they get from these online portals.
(v) High-value rebates are preferred than instant discounts by millennial. Let the shopping category, include electronic gadgets, sporting, fashion items, entertainment, clothing, groceries, and even books, the millennial prefer high-value rebate than that of instant discount. This clearly indicates the area where the retailers should put their money on to lure the consumers by providing a competitive high-value rebate program without losing the profit in the longer term.
(vi) Cash on delivery, Gift cards are preferred to be safest by millennial. When it comes to payment for the products purchased online, millennial prefer cash on delivery (48 percent), Gift cards (20 percent), others (18 percent) and net banking (14 percent). This clearly indicates the cautiousness of the millennial towards online payment system. So retailers should bait out with safer payment system to outbreak the competition.
(vii) Millennial encompass programs towards loyalty. With preferences changing every moment, millennial try to overlook the offerings provided by a single outlet. But when they are satisfied with a company's offerings they turn out to be loyal (69 percent) to the product by enrolling themselves in the loyalty programs offered by the company. This approach should be adopted by retailers to enkindle the millennial by offering the industry best value-added loyalty program to retain the customers. By adopting this loyalty program even smaller retailers can compete with that of the giants of the industry.
The study reveals that millennials are clued-up into online and mobile shopping leaving the traditional shopping pattern in mayhem. It also states that the millennials respect their individuality than anything else which makes them to not fit within any strategies. They try to liberate their value system with the integrity of the business which provokes them to make a decision on purchasing behaviour. It is indisputable that the purchasing power of the millennial exceed every other generation due to the perception of the online shopping and their attitude to learn new technologies.