Online markets being “dynamic”, and become an integral part of the information and communications technology-intensive service sector which has exhibited an acceleration of labour productivity growth in many countries.15 Online markets are very much information intensive. The nature of many transactions places rich sources of information about consumers (and perhaps also other market participants) in conveniently digitized form, at the disposal of companies providing services such as search, payment, and social network services. The collection of information about customers is not unique to online markets, but the scale under which it has become possible is unprecedented. As the quantity and quality of information companies have about their customers and about the customers of their competitor’s increases, there arises scope for provision of valuable new services but also for the exercise of market power. On the other hand, firms might be also able to use information to better price discriminate and extract surplus from customers, or to pre-empt putative rivals from entering a market. However, better-informed consumers may also be more discriminating in their decisions, for example, in terms of price or quality.16 Major platforms such as Amazon, PayPal, eBay, support and enforce a system of buyer and seller reputations which facilitates many valuable trades which otherwise could only take place in face-to-face markets. Hence, here is a vehicle for consumers and SMEs to benefit from the control of information by major platforms.
E-commerce and internet have changed the buying behaviour of Indian consumers and driven them towards buying goods and services online. Online has been growing in a rapid way in the last few years, but is still at its nascent stage when compared with the US and China. Hence, there will be a huge potential for online buying which provides a boon for many small and medium enterprises. With India turning net savvy, online buying has become the latest fact in India with most of the net surfers recommending internet shopping.
Indian online shoppers are brand savvy, even when they are buying online. Category-wise life style products, such as cosmetics, clothing, jewellery, watches, cell phones, fashion products, healthcare, and fitness equipment accounts for nearly 60% of the e-commerce sales in India.
The main reasons for buying online can be listed as follows.
- Better prices
- Fewer expenses
- Comparison of prices
- Avoiding crowds
- Compulsive shopping
- Buying old and unused at low prices
- Discreet purchases
- Changing nature of work
- Customized and new product capabilities
In the event of a problem, consumers are concerned with the ease with which they can return an item for the correct one or for a refund. Some online companies have more generous return policies to compensate for the traditional advantage of physical stores. Some online stores provide or link to supplemental product information such as instructions, safety procedures, demonstrations, or manufacturer specifications. Some provide background information, advice, or help consumers decide which product to buy. Reviews and now blogs give customers the option of shopping cheaper and organize purchases from all over the world without having to depend on local retailers. Some online stores have real-time chat features, but most rely on e-mail or phone calls to handle customer questions. One advantage of shopping online is being able to quickly seek out deals for items or services with many different vendors (though some local search engines do exist to help consumers locate products for sale in nearby stores). These are the main drivers of online buying.
For citing this article use:
- Sreekanth, C. V. V. D. (2016). Factors determining the online buying behaviour a study with special reference to consumers in Andhra Pradesh India.