Consumer behaviour

Apart from the previous section, the following part will explore consumer behaviour and consumer purchasing decisions. To clarify that theoretical knowledge, a case study of Shopee also is laid out as a good example.

2.3.1. Consumer behaviour

Firstly, there is a wide range of concepts within the scope of consumer behaviour research.

Solomon et al. page 6 (2006) explained the definition of consumer behaviour in their book as follows:

‘’Consumer behaviour…… is the study of the processes involved when individuals or groups select, purchase, use or dispose of products, services, ideas or experiences to satisfy needs and desires.”

Indeed, consumer behaviour refers to a behaviour regarding purchasing of products. And it is a continuous process. The definition also highlights the interaction between buyers and sellers during the purchasing process. Even exchange plays an important role in consumer behaviour.

The full consumption process still includes variables that impact consumers before, during, and after purchase. Consumer behaviour also have a lot of different actors. This means various people can be included in the consumption process. In this process, consumer commonly is an individual who recognizes a need or desires, purchases and then disposes of the good or service.

But sometimes, the buyer and the consumer of a product are different person. In some case, instead of buying a product, an individual may perform as an influencer, who give recommendations for a typical product to others after using. But consumers also can be groups or companies where one person usually make a purchase of various products that will be used by many people (Solomon et al., 2006).

Another objection is that consumer behaviour is the act of one or more people purchasing and using items and services, as well as the psychological and social processes that occur before and after the act of shopping. Alternatively, the purchasing behaviour of end consumers refers to people that purchase products and services for their own consumption (Kotler & Amstrong, 2004).

It is said that consumer behaviour is the research of consumers and the process they use to select, consume, and discard goods and services, as well as their emotional, mental, and behavioral responses (‘’Consumer behaviour’’, 2021).

On another hand, Schiffman & Kanuk (2007) have the same definition of consumer behaviour, which is a wide range of activities such as searching, buying, using, evaluating, and discarding goods and services. Consumers can meet their requirements through these activities. Individuals and groups are the two sorts of consumers identified in the study. Groups commonly purchase

12 items for business purposes, such as funding and managing an organization. Whereas individuals buy items to satisfy their own consumption needs (Schiffman & Kanuk, 2007).

Clearly, the definitions mentioned above have basically specified the concept of consumer behaviour, which strongly supports the next part.

Consumer buying decision

To repeat, consumer behaviour is known as the study of how everyone makes decisions about what they buy. Thus, the consumer buying decision is one of the most important aspects of consumer behaviour (Solomon et al., 2006).

Consumer purchasing behaviour is referred to as the buying behaviour of consumers. A lot of elements influence how an individual behaves during the purchasing process. For instance, they could be his/ her shopping habits, favorite brand, or shopping locations. However, sometimes the buying decision of an individual can be driven by his/ her emotion, culture, trend, or social, etc.

By analyzing and understanding which factors impact customers, businesses and companies should easily build their marketing strategies to gain more customers (Ramya & Ali, 2016) In general, there are three issues that arise during five stages in the consumer buying decisions or consumer decision-making process. The first issue which is pre-purchase, consumers recognize needs like how they know they need a product. If they make sure about the decision of finding a product, they should look for information about it, and consider alternatives of the product. Next, if consumers know what they want, and have chosen their preferable product, they make a purchase in the purchase issues. Lastly, the final issue is post-purchase, in which consumers evaluate those products after buying them (Solomon et al., 2006).

In more detail, the buying process begins when the buyer become aware of a problem or need.

Needs can arise from internal or external environment events. One of the basic humans wants, such as hunger and thirst, are considered as internal elements. When those internal elements raise to a certain level, they highly motivate and push the buyer to consume a product like food, or water. A need also may come from external factors, such as seeing advertisements of a product on social media. All the issues listed above are indicators of a problem or necessity.

In the point of view of Solomon et al. (2006), the second stage is information research. Once looking for information of a product, if the need is strong enough, and the information of product is easy to find, consumers are more likely to purchase the product. In some cases, because of the lack of information, consumers may stop their searching and not purchase the product.

Depending on the product category and consumers’ attributes, the influence of various information sources may vary. Information sources are divided into internal and external search.

They may come from personal data, commerce information, public information, or empirical data. In general, commerce sources provide the most relevant information about the product like

13 advertisement, agencies. While personal sources like family, friends give the most effective information. In terms of influencing purchasing decisions, commercial information often notice consumers about product available, or product suppliers, whereas personal data helps to evaluate product.

The next stage is evaluation of alternatives. After having information about the product, consumers tend to consider product alternatives in term of reputation and available features.

Consumers suppose that the product should bring necessary benefits to them and satisfy their expectations. Consumers build their ow beliefs about brands by evaluating according to their attributes. Consumers’ brand beliefs will change depending on their experience, and the impact of selective perception. As consumer attitudes towards brands are formed through an evaluation process, such as comparing reputation of brands to their product quality. The preference of a certain brand is determined by its position in the market.

In the previous stage, consumers choose a product from the brand which stay at the top position after considering various suppliers. However, there are many other reasons that may affect the purchasing decision, such as product reviews from other people, expected price, etc.

Lastly, Solomon et al. (2006) state that the final stage is outcomes and evaluation. In this stage, consumers receive their product and enjoy their purchase. After purchasing, consumers will be satisfied or disappointed at a certain level. Customers will be satisfied with the product if it meets their expectations. As a result, customers may purchase the product again, and be able to give positive feedbacks about it with others. Otherwise, if the product is failed to fulfill consumers’ needs, they will be dissatisfied, thus there are bad reviews about products. However, they can consider returning or throw the product away to minimize their dissatisfaction.

But it is not required to get through all the above stages of the consumer buying decision, especially when shopping online. Some stages can be skipped or reserved by customers.

Factors influence consumer behaviour

In fact, consumer purchase behaviour is affected by four key elements, which are reasons why each consumer behaves differently. They are cultural factor, social factor, personal factor, and psychological factors (Kumar, 2019). Cultural factors first refer to culture which is a system of shared values, rules, and beliefs that bring the entire society together. Culture has a significant impact on consumer purchasing behaviour. Because of cultural diversity around the world, it is essential for marketers to apply right marketing strategies to meet their consumers’ needs. And every culture has a sub-culture that is followed by people within that culture. This group of people usually have similar habits and purchasing patterns. The social class which divided people in the society into four categories from the highest to the lowest position, is considered as one of cultural factors. The need of each social class, such as upper class, upper-middle class, middle class, and lower class, is not the same. In addition, family, friends, reference group, and the opinion leaders are socials factors that influence consumer decision-making process. The

14 family life cycle drives product demand and purchase patterns, which are determined by personality and attitude. Even friends are informal and unstructured groups, most consumers purchase a product following their friends’ recommendations of the product. Reference group is another social factor. Members in the group perform as influencers who suggest other members purchase the product (Kumar, 2019).

2.3.2. Online consumer behaviour

Consumer perceptions of online shopping via e-commerce platforms

Before exploring online consumer behaviour, it is necessary to point out consumer perceptions of online shopping via e-commerce sites in terms of advantage and disadvantage. In other words, online purchasing offer numerous advantages in modern life, but it also has several potential drawbacks for buyers.

As explained earlier, e-commerce has become more and more popular nowadays which leads consumers tend to shop online via e-commerce sites. From consumers’ point of view, shopping via e-commerce has boosted convenience by removing many of the barriers generated by time and geography. Consumers now can shop without leaving their house 24 hours a day, seven days a week (Solomon et al., 2006). It is not surprising to find that the reason why many people avoid going to the mall is the fear of queuing at supermarkets or shopping malls during rush hour. As a result, online purchasing spares customers from these inconveniences. Another advantage of online purchasing is that it saves time. Instead of spending hours in shopping malls, the average consumer spends approximately 15 to 30 minutes to find the item they require on shopping websites. Customers can also shop at any time of day, regardless of the malls' operating hours (Niranjanamurthy M et al., 2013) Aside from convenience, additional advantages of online shopping through a website include a diverse selection of products, competitive pricing, and free shipping which will be clarified in following sections.

In terms of disadvantage once buying online via shopping sites, Solomon et al. (2006) state that security is the biggest limitation of e-commerce. Other limitation is related to the actual buying experience. One of the main reasons why people avoid buying things on the internet is because they can't touch them (Solomon et al., 2006). Additionally, consumers are confused while purchasing items online because it is difficult to check the quality of the goods. For example, the product description on the website is not always accurate. It is common when received item does not match the website's description or is the wrong color (Niranjanamurthy M et al.,2013).

Consumer online shopping decision

As the aim of this paper is to study online shoppers’ behaviours, this part will concentrate on understanding how consumers behave on online platforms.

15 In more detail, Bashir et al. (2015) state that online shopping is the current trend that allows people to buy everything from home. In other words, one of the best methods of convenient shopping is online purchasing. It can be seen as a popular means of shopping among the Internet community. It is true for developed countries, where e-commerce platforms are becoming more and more popular. Now, this trend to shop online has been explored in the Asian region as well, especially in Vietnam. Vietnam tends to follow the trend fast. It has multiple websites, along with the commonly known companies, such as Shopee, Tiki, Lazada.

At present, it is so easy to buy goods and services online through the internet via e-commerce platforms. Online shopping makes a big change in the way how people consume. Even though, people keep shopping from physical stores. But shoppers feel more comfortable once purchasing online (Katawetawaraks & Wang, 2011).

To specify this concept, the online shopping decision process is viewed under comparison with offline shopping decision making. Not only detailed information of product, product alternatives but also the price have been public on e-commerce sites for customers. This helps consumers simplify their buying decision process. Thus, online shopping brings more satisfaction for people asking for convenience (Rahman et al., 2018).

Besides, Katawetawaraks & Wang (2011) suppose that there are not many differences between online and offline shopping in terms of buying decision-making. There are two biggest points that differ between online and offline purchasing, involving the shopping environment and marketing communication.

In terms of marketing, various advertisements on social media and notifications of promotion via e-mail should attract consumers, which increases their demands for products (Katawetawaraks &

Wang, 2011). As mentioned above, the purchasing process contains three phases and five stages.

After recognizing needs, consumers tend to seek for information about products on the internet.

However, before purchasing, they need to consider alternatives of products to figure out which are their preferred ones. In this stage, consumers will be persuaded to buy things via a shopping site if the website structure is well-organized and attractive. Therefore, e-commerce platforms can effectively support consumers at the pre-purchase stage. Plus, buyers who decide to buy or not also pay attention to sellers’ sale services, such as shipping service or extra gifts. Then post-purchase is a crucial phase in online shopping. As sometimes customers have problems with the product, they might want to exchange or even return it. Thus, exchange and return service or product feedback is a necessary feature on an online platform (Katawetawaraks & Wang, 2011).

To clarify the online consumers’ behaviours ad their shopping decision, it is essential to understand characteristics of online consumers. Generally, Hasslinger et al. (2007) suggest that consumer characteristics can be described by cultural characteristics, social characteristic, personal characteristics, and psychological characteristics.

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