CHAPTER II

Reviews of Related Literature and Studies

This chapter includes the ideas. The main purpose of this paper is to investigate

shoppers’ experience with traditional and online shopping. Other objectives of this paper

are to find out the kind of goods that shoppers purchase most online and to ascertain

the shopping frequency in online stores. It consists of literature review. ,

Online shopping indicates electronic commerce to buy products or services directly from

the seller through the Internet. Internet-based or Click and Order business model has

replaced the traditional Brick and Mortar business model. More people than before are

using the web to shop for a wide variety of items, from house to shoes to airplane

tickets. Now people have multiple options to choose their products and services while

they are shopping through an online platform.

So far, online shopping has its downside also. It makes the buyers away from the

shopping experience since they are only at home. Lack of shopping experience is also

lack of face-to-face examination of the product that is going to purchase of a customer.

Products online are only displayed through pictures and so buyers do not have the

chance to touch and examine it in person. Another disadvantage is the time a customer

is waiting to receive the product in hand. Since it is an online shop, one has to wait

when it will be delivered. Refunding and returning of the product is a long process also

in online shopping a physical store, Clients can see the products, which assists in
facilitating purchasing decisions. Further, a physical store offers a sense of security to

the clients. Hence, when they visit your website, they can make online sales

comfortably. Clients will trust you more when they are aware you operate from a

physical place they can access. If you have an online presence, a physical store will

complement your marketing efforts.

RELATED LITERATURE

Local literature

According to the article “What Makes E-commerce Click?” (2017) , eleven years ago RJ

David made his bedroom turned into a boardroom while he was setting up the most

successful buying and selling sites in the Philippines. He did state that he knew that the

main hindrance of e-commerce would be the trust of the consumer because Filipinos

would not be comfortable to the thought of paying someone through online and waiting

for their purchased product to arrive.

According to Svonavec (September, 2017), online shopping has proved to have many

positive advantages for consumers. Online stores are open 24 hours a day, so the issue

of a store closing before the consumer can make it on time exceptionally efficient during

the holidays; shoppers do not have to bother with the long, exasperating lines. Due to

lack of operating costs, online retailers can sell goods at lower prices so that this makes

the experience of online shopping not only faster and convenient, but it is also for

cheaper than going to the physical store. Although online shopping has advantages,

there are many downsides to doing online business. Back order goods can be prove to
be exceeding trying for shoppers, especially during the holidays, shoppers also lose the

person to person communication that online retailer cannot provide. As said by Francia

(October, 2018), Filipino shoppers also prefer inspecting the products themselves

before making a purchase, while others factored in the cost of shipping and the length

of delivery time. Research Tech Lab (RTL) noted that Filipinos more assured when they

examine the products before checkout, while being able to take the item immediately

after payment gives them peace of mind. It also recorded the enticements of online

shopping from July to September, which coincided with the sale promo of leading e-

commerce sites Lazada and Shopee. Here, the company found that 68. 61% of Filipinos

Still favour traditional shopping. The market has rapidly grown since then. According to

Eshopworld.com, there are at least 37.7 million e-commerce users in the country in

2018 from the 30. 2 million estimated in 2016. The number is expected to rise to 53.8

million by 2020. A report published in May 2018 found that despite its growing

popularity, the Philippines lags in terms of e-commerce sales in the Southeast Asian

region (Eshopworld.com).

According to Willy Kruh, he said that today’s consumer no longer goes shopping, but

shopping all the time and everywhere. In a truly global online marketplace, competition

is no longer limited to local shops during regular business hours. Consumers can easily

buy from retailer and manufactures located anywhere in the world or from those with no

physical retail locations at all.

According to Manglinong, D. (2018)“Why Online Shopping is Booming in the

Philippines” the reason why most of the people prefer shopping online especially during

the christmas season and special holidays as early as December is because

consumers likes to shop through the internet. It is also stated that online shopping has

been growing for the past years, as early as the year 2015 were revealed that 9 out 10

Filipinos would prefer online shopping than actual shopping since people can save a lot

due to certain online shops who offer special deals or discounts for consumers rather

than in an actual store.

According to the article by Montealegre, K.A. (2018)“E -commerce Expected Growth to

Drive More Brick-and-Mortar Business to the Philippines”, states that more global stores

would set foot on the Philippines shores as a brick-and-mortar stores in more advanced

due to its fast growing e-commerce. Because of the fast growing of e-commerce here in

the Philippines a lot of foreign countries has been seeing the Philippines as a great

option in doing brick-and-mortar business since foreign brands are positive that their

stores would also be growing faster than expected.

Foreign Literature

According to Vijay et.al (2017) suggests that both internal and external elements have

direct influence on website satisfaction. They highlights on why and how satisfaction

with website matters in the contribution of shopping values and website atmospherics to

behavioral outcomes by presenting its mediating role. The U.S. has the highest total

revenue from online shopping out of every country in the world. However, the United

Kingdom has the highest ecommerce spend per capita. Chinese citizens spend a higher

percentage of their salaries online than any other country. (Ecommerce Wiki, World

Atlas)
According to the article Asean Up (2018) “Insights and Trends of E-commerce” the

Philippines is a country of a large and rapidly growing market for e-commerce. With the

continuous growth and development of digital technologies in our country, especially

through internet connectivity with the use of mobile phones this would be one of the

main factors that will make the Philippines, sooner or later, the major player of e-

commerce in Southeast Asia.

According to Khurana, A. (2019) “Disadvantages of E -commerce”, one disadvantage of

e-commerce that may affect the students is it delays good due to delay of shipping

dates of the seller. Second is it does not allow the consumer to experience the product

before purchasing it, this might be one of the risk factors that you might experience

because cannot test the quality of the product which makes it as a waste of time and

money. Third, anyone can set-up a store online. If anyone can easily just set-up a store

through online how would a consumer know if the store they are purchasing from is

genuine or legitimate? Lastly, the security. When purchasing online people must provide

the details of the credit card that they would be using for the transaction without being a

hundred percent sure if their credit card is safe and won’t be hacked.

RELATED STUDIES

Local Studies

According on the study conducted by Lucero, et.al (September 2016), he determined

whether there is a significant relationship between consumer perception and purchase

behavior on online shopping among students. It has been found out that the respondent
perceptions and their purchase behavior on online shopping are both high. To sustain

their high perception on online shopping, it is suggested that web developers should

incorporate features on their websites regarding convenience, security, benefits and

leisure. It is important for online marketers, entrepreneurs, and business men to

consider the fact that students spend more time on the internet and that this factor will

likely increase the students online shopping behaviour. The Philippines has become a

virtual gold mine for online shopping. Proof of that is that many online shopping malls

are now on expansion mode. Lazada and shoppee is one of the largest online shopping

website in Southeast Asia. It announced that it has raised $ 250 million from a group of

investors including Tesco PLC, Access Industries Investment AB Kinnevik and

Verlinvest.

Endel Mata stated that Department stores and shopping malls were also affected by the

growing market share of online retailers. Since the main selling point of department

stores is their in-store experience, they are yet to fully respond to the increasing

demand for online shopping. Since a physical store exposes customers to a wide range

of products, sales increase as clients buy extra items

According to Manuel Berto the offline stores will still be the bread and butter. I think for

the most part, the experience of shopping, touching the merchandise and interacting is

still going to be the bread and butter of our business. With a retail store, the potential

customer base is limited to the surrounding area. Online, the customer base is huge.

Once you open up a retail store, your options for attracting new customers are limited.

You are confined to the retail space that you chose and changing logos, signs, shelving

and the overall marketing strategy can be expensive.

In a study by Khan, A.G. (2016), it is stated that the benefit that consumer can get from

e-commerce is its convenience. Due to a consumer can just place a purchase anytime

and anywhere without the hassle of leaving one place just to go to its physical store.

But, while e-commerce is giving benefit to a lot of people, it also gives a challenge to

traditional businesses. Developing countries face many obstacles that affect the

successful implementation of e-commerce with the help of comparing with developed

country. When the internet cost will be low then the e-commerce will flourish easily and

will make many of the traditional business to run out of their business.

Nowadays, online shopping holds the attention of the retail market as millions of people

shop online (Sivanesan, Monisha, Babisha & Abisha, 2017). The boosts in Internet

technology allow for the expansion of shopping options beyond the traditional

methods that may be more time consuming (Akinbode, Ekpudu, Ojo & Are, 2016).

Issues with having to physically gather information with traditional shopping methods

are alleviated, and shoppers are better able to efficiently use their time (Ekwueme &

Akagwu, 2017). For instance, instead of having to physically visit different stores to

compare prices or rely on circular pamphlets in newspapers, a shopper is able to search

and use needed information through the Internet. Current retailing trends show a shift

from traditional store-based retailing to an increased use of the Internet (Keen, Wetzels,

Ruyter& Feinberg, 2002; Skiver & Godfrey, 2017). However, in a country like Nigeria,

shoppers still buy a lot from shops and malls thereby still making the traditional
shopping very relevant (Falode, Amubode, Adegunwa & Ogunduyile, 2016).This

modern means of shopping and the traditional method are different in terms of

opportunity, merits and demerits for buyers and sellers respectively. Shopping

today is much more than just buying, it is an experience itself. Shoppers now value

convenience and choice as well as getting value for their hard-earned money

(Falode, Amubode, Adegunwa & Ogunduyile, 2016).

Today’s shoppers have, not only many store choices, but they also have a wide variety

of channels to choose from (e.g. E-commerce, traditional method and so on). With the

continuous increase in the competition among channels, the understanding of what

motivates shoppers to purchase from one channel rather than another becomes

progressively important to retailers (Sivanesan et al., 2017).

In a study by Sarkar, R. & Dr. Das, S. (2017), it is stated that there is a difference

between an actual shops and e-commerce in terms of consumer’s shopping style in

India. Even though e-commerce is growing rapidly across the world and the projection

of further rise in this medium of shopping, it is still proven based on research conducted

in India that the majority of the consumers in their country still prefers the actual

shopping of brick and mortar shops. In the different studies, it shows that most of the

online shoppers or users of e-commerce are mostly youngsters who are fueling the

rapid growth of e-commerce in India. The advent of online shops or e-commerce has

impacted so much to the offline stores or actual shops of certain products since online

shops are offering enormous discounts to consumers that would make the actual shop

suffer and it puts a lot of pressure to the brick and mortar business. Moreover, the

Indian real estate sector is doubting the development of brick and mortar business. On
another note, even though online stores’ are rapidly growing, none of the brick and

mortar businesses have reached rock bottom yet.

The statistical results revealed that online customers monthly spending amount as well.

There was a statistically significant positive relationship between the amount of time and

money spent on the internet. The three most popular online shopping sites were

determined as trendyol, hepsiburada and alibaba. The products must online customers

bought were clothing, stationery products, online tickets, and electronic devices (Kilic,

Z., Ates V. 2018).

Traditional shopping

Imagine going to a store, think of your favorite store in the nearest mall to where

youlive. You get into the store, slowly walking from rack to rack, checking out the

display, putting a dress over your body and trying to check out your reflection on one of

thenearby full-view mirrors that are placed all around the store. You move on to the

nextdisplay rack, and probably make another selection and do the same thing you did

earlier.This is what traditional shopping is about. Having the ability to physically choose

andcheck out what an item or product is like, would look like, and what its features are.

Thisis why some consumers still prefer the traditional type of shopping over online

shopping because for one, it allows them to meticulously check out an item. ome

consumers arenot !uite certain with their own si"e, sometimes fitting a si"e that would

normally be bigger or smaller than their actual si"e. o in retrospect, while online

shopping has not #ust numerous benefits and advantages as explained by many online
consumers as well asstudies and surveys, there are still conventional shoppers who like

to check out the product that they are interested in buying.

Online shopping

The increase in technology provides good opportunities to the seller to reach

thecustomer in much faster, easier and in economic way. Online shopping is emerging

very fast in recent years. Now a day the internet holds the attention of retail market.

Millions and millions of people shop online. 3n the other hand the purchasing of product

fromtraditional market is continuing since years. Many customers go for purchasing

offline soas to examine the product and hold the possession of the product just after the

payment for the product. In this contemporary world customer's loyalty depends upon

the consistent ability to deliver quality, value and satisfaction. Some go for offline

shopping, some for online and many go for both kind of shopping. The focus of the

study is on the consumer's choice to shop on internet and at the traditional stores at the

information gaining period. However online shopping is easier for the people and less

price than the offline shopping. While making any purchase decision consumer should

know the medium to purchase whether online shopping or the offline shopping.

Consumer should decide the channel for them which can best suit to their need and

wants and which cansatisfy them. In this competitive world how consumer can decide

the particular medium for their purchase of goods is very important to understand in a

managerial point of view.

Product quality is a very important factor considered when making a purchasing

decision for goods and services. A study by investigated the criteria that Romanians

consider when choosing to place a product in the shopping cart. The results found the

following factors that influence the purchasing decision, presented in order of their

importance: the price - 80% of the Romanians choose the products according to the

price. Romanians tend to choose the cheapest products: "the lower the price of a food,

the greater the chances that the product will reach the shopping cart" (Spiridon, 2017).

Another important criterion is quality, 74% of consumers consider quality to be important

or very important, followed by brand and package.

We also explore if there is any difference between attributes used to evaluate product

quality in a physical store and attributes used to evaluate product quality in an online

store. The interest for the online environment is motivated by its evolution experienced

in recent years. In Romania the value of the e-commerce market in the total retail

market registered a proportion of 5.6%, in 2017, up from 4% in 2016. The variety of

online stores can be remarked, with 7,000 relevant online shops in terms of traffic and

orders in 2017, compared to 5000 online stores in 2016. Out of the 5,000 active online

stores in the Romanian e-commerce landscape in 2016 “approximately 200 are big and

medium businesses, exceeding 1 million EUR in annual turnover” (Radu, 2016).

the product quality in physical stores versus e-commerce.

Price

Retailers do not always offer the same deals in brick-and-mortar stores as at their online

counterparts because the cost of running a physical establishment can be considerably

greater than for an online store. Factors such as rent, electricity, payroll, fixtures and

shrinkage loss all contribute to the gross margin and overhead of doing business in a

shopping center or elsewhere. (Montaldo, 2021) According to BigCommerce's 2016

State of Omnichannel Retail study, the price of a product is the most influential factor

when shoppers are determining whether or not they should head to checkout. Of the

shoppers surveyed, 87 percent indicated that the numbers after the dollar sign were

either "very" or "extremely" influential in the decision to shop and buy. Close behind

price in terms of buying influence was the cost of shipping and speed options offered

(80 percent), with discount offers (71 percent) rounding out the three most influential

online shopping forces.

Marital Status

They found that customer satisfaction differs across individuals on the basis of their

gender, marital status, age, occupancy and frequency of visiting the bank. For example,

they found that female customers tend to be less delighted and satisfied with the bank

than their male peers. In addition, the married individuals are more likely to be satisfied

in comparison to their unmarried counterparts. Jham (2018) investigated the

factors and word of mouth communications in the banking industry. Using a mixed

method, they found that customer satisfaction towards service quality depends on

satisfaction with various banking services which tends to create positive word of mouth

communication. However, they found no significant role of customers’ demographics

during this process. Under the existing mixed findings regarding the effects of marital

status on customer satisfaction in various industries and countries, we conduct the

current research which aims to explore the real effects of marital status (i.e., single or

never married; married; divorces/separated) on customer satisfaction, and then

consider the moderating impacts of gender on such relationship.

Benefit

People decide to do shopping online or offline due to several reasons. When shopping

online, there are several benefits you will enjoy. Online shopping allows you to save

time and money. You can relax in your home and use your laptop to access several

shopping sites online. The ability to compare several shopping sites online make it easy

to save money. You can always locate the best deals easily when shopping online.

Here are some of the benefits you will enjoy when shopping online and offline

Conclusion

Meanwhile, it is still a question in mind of which in Online and In-store shopping

is a better buying process. Online shopping is the latest way of buying products wherein

customers do not need to go in the store to shop. One just need a technological device

like cell phone, tablet or iPad, or laptop and make some tap and click to purchase a
certain service or product. This way or buying a product is beneficial to the customers

as they said it saves time and effort. Some products in online shop are cheaper

compared to actual store in malls. Another factor being considered is that there are

more available products online unlike in stores. Due to easy access in all online shops,

buyers can go from one online shop to another.

Temporarily, even though online shopping is paving the way, traditional shopping is still

in the business process. As the traditional way of acquiring products, it is still patronized

by some for the experience it is giving to the consumers.

Traditional shopping provides the customers the shopping ambiance. Through going

directly to store, potential buyer really experience the presence of sales staff, the

company‘s offering and the atmosphere of a shopping store.

In addition, through in-store shopping, he or she can examine and test the product they

are planning to purchase. Touching the product personally is essential to the buyer to

know and try the features of a certain product. Also, customer can easily communicate

with the seller or sales agent at the store rather than online. With these, customer

relationship is enhanced.