Full Report Business Research - Segi College

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Online Consumer Behavior - Fashion Apparels

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Chong Hor Yee, Lim Hooi Huang, Muhammad Hafiz, Kho Hock Seng, Margaret Yong Shu Wen. (DIM Friday 830-1130)Task 1Topic : To determine the influences of social media and its tools for online shopping purchasing behaviour for fashion apparels. IntroductionThe ideology of fashion was imposed mainly as a luxury item or status before the birth of the digital age and internet era. Before this, people had to wait on the day of launching to actually witness the latest designs, but now, people could access the latest fashion from the palm of their hands. With the birth of the internet coupled with the economy of scale and with ease of access to the internet, fashion is no longer an elites game. Technology has helped the fashion industry grow tremendously over the past years. This research essay is undertaken to analyse the influences of social media and its tools towards online purchasing behaviour for fashion apparels.Research Rational The main discussion of this research is to identify the effects of social media towards consumer online purchase behaviour. In addition, this research explores how influential social media can be towards customers fashion purchase decision. This research also explores the psychological and behavioural drivers of online fashion purchasing. Moreover, the research argues on how fashion brands use social media to promote online shopping apparels. Last but not least, the research analyses the changes in trends of purchasing fashion apparels before and after the birth of online shopping. Task 2Research Questions1. To what extent does social media and its tools influences customer online fashion purchase decision?2. What are the psychological and behavioural drivers of online fashion purchase? 3. How do brands promote their online shopping of fashion apparels?4. What are the changes in trends of purchasing fashion apparels before and after the birth of online shopping? Research Objectives1. To explore the extent of the influences of social media towards online fashion purchase decision.2. To explore the psychological and behavioural drivers of online fashion purchase.3. To identify marketing strategies used to promote online shopping of fashion apparels.4. To identify the changes in trends of purchasing fashion apparels before and after the birth of online shopping. Task 3 : Literature searchTitle: Information availability on US apparel merchant Web SitesJournal :http://elib.segi.edu.my:2057/journals.htm?issn=13612026&volume=6&issue=2&articleid=858521&show=htmlThe research problem of this journal is online merchant Web Sites provide only limited product information to the customers, hence, increase the risk perceived to purchase clothing on the Internet. The objective of this journal is to explore the availability of product and customer service information of a Web Site affects the intention to purchase on the Internet. According to Lin and Lu (2000), the main finding of this journal is the quality of a Web Site, which described by information quality, response time and system accessibility. Therefore, this journal is related based on to explore the extent of the influences of social media towards online fashion purchase decision.Title : Psychological and behavioural drivers of online clothing purchase.Journal: http://elib.segi.edu.my:2057/journals.htm?issn=1361-2026&volume=8&issue=1&articleid=858569&show=htmlThe research objective of this journal is to examine psychological characteristics that lead consumers to buy clothing online. The main findings of this journal imply that online apparel buying is motivated more by Internet innovativeness than by clothing innovativeness. This journal is related based on the objective of the research, which is to explore the psychological and behavioural drivers of online fashion purchase.Title : Social network online communities: information sources for apparel shoppingJournal : http://elib.segi.edu.my:2057/journals.htm?issn=0736-3761&volume=29&issue=6&articleid=17050939&show=htmlThe research objective of this journal is to understand the effects of social network online communities towards information seeking behaviour and purchase decision for online apparel shopping. The main findings of this journal confirms the positive effects of social network online communities towards consumers purchase decision. This journal is related based on the objective of the research, which is to explore the extent of the influences of social media towards online fashion purchase decision. Title : Online Branding Strategies of UK Fashion Retailershttp://elib.segi.edu.my:2057/journals.htm?issn=1066-2243&volume=19&issue=3&articleid=1795284&show=htmlThe research objective of this journal is to explore the strategies of online branding by UK fashion retailers. This article analyses how online channels are used, including communicating brand identity and presence, as well as building brand relationships. The main findings of this article is, fashion retailers offer online transactions and able to achieve consistency on visual identity for both online and other channels. However, these fashion retailers have an underdeveloped online channel. This journal is related based on the objective of the research, which is identifying marketing strategies used to promote online shopping of fashion apparels. Title: Understanding designer clothing purchases over the internetJournal : http://elib.segi.edu.my:2057/journals.htm?issn=1361-2026&volume=14&issue=3&articleid=1875533&show=htmlThe research objective of this journal is to understand designer clothing purchases over the internet. Based on (Lee and Littrell, 2005; Park and Kim, 2007) , the article discussed that by having a competitive price and having product in stock, it influences the attitude and buying perception of customers over the internet. Designs of clothing can contribute to purchase through internet but there are only several studies that are researching on the similar topic. The article states also states that individual are most likely to search for information if they have the intention of buying. This proves that intention to purchase over the internet is mostly based on the behavior of an individual and how they judge the product. This journal is related to the objective of the research, which is to identify the changes in trends of purchasing fashion apparels before and after the birth of online shopping.Title : Internet retailing: the past, the present and the futureJournal : http://elib.segi.edu.my:2057/journals.htm?issn=09590552&volume=38&issue=11/12&articleid=1895952&show=htmlWith the growing popularity of the Internet, online retailing has become a new electronic market place to promote products and services. Online retailing is a part of marketing channel which regularly used by most of the marketers to extend product lines, improve cost efficient and customer relationships. Besides that, the research objective of this journal is to determine how online retailing transforms the shopping habits of the society based on the traditional promotional strategies. Meanwhile, online retailing has become a vehicle for promoting products and services and capturing sales. The main finding of this journal is to identify the advancing of social media nowadays is replacing the one-to-one marketing strategy. This journal is related based on the changes in trends of purchasing fashion apparels before and after the emergence of online retailing.Task 4 : Literature ReviewOnline Fashion PurchasingIn this millennial era, the internet and technology has made it possible to purchase fashion apparels from home. The total amount of spending on the Internet has increased tremendously and is expected to reach $3 trillion by 2003 (IDC, 1999). The percentage of US Internet users reporting they have purchased clothing online has grown rapidly, doubling from 8 percent in September 1999 to 16 percent in May 2000 (Pastore, 2000). Despite the rapid growth in online sales of apparel, some consumers are reluctant to shop for clothing on the Internet (Park and Stoel, 2002). A recent trade study showed that these non-purchasers perceive risk to exist due to their inability to try on garments, feel the fabric, and read information on care and content labels (Pastore, 2000). Research has shown that intention to search for information on the Internet has a direct effect on intention to purchase on the Internet (Shim et al., 2000). If a customer is satisfied with the information provided by the retailer, they are more likely to make a purchase (Park and Stoel, 2002). The Internet can be used to provide consistent and comprehensive product and customer service information (Park and Stoel, 2002). In addition, customer service over the Web is likely to be more consistent than traditional retailing because the online retailer can provide more detailed and extended information to any shopper at any time (Silverman, 1998). Perceived Risk for Online Fashion PurchaseSimpson and Lakner (1993) found that four dimensions of risks may exist when consumers make decisions regarding apparel selection and purchase apparel using mail order: social/psychological risk (e.g. concerns with fashion innovation, acceptance, planning purchases, conforming to others), economic risk (e.g. concerning prices of apparel, possible financial loss), performance risk (e.g. style, durability, or wear life of a garment), and physical risk (e.g. bodily comfort, discomfort, appearance). ). For the most part, consumers perceive more risk associated with in-home shopping than with in-store shopping (Donthu and Garcia, 1999; Schoenbachler and Gordon, 2002; Vijayasarathy and Jones, 2000).Psychological and Behavioural Drivers of Online Fashion PurchaseIn 1999, clothing accounted for 13.3 percent of retail sales online (US Census Bureau, 1999). In 2001, more than one third of online purchases were clothing (Goldsmith and Lynn, 2004). Nowadays, retail merchants focuses more resources on the Internet in an effort to increase the protability of their Web sites (Grimes, 2002). For the most part, consumers perceive more risk associated with in-home shopping than with in-store shopping (Donthu and Garcia, 1999; Schoenbachler and Gordon, 2002; Vijayasarathy and Jones, 2000). However, this risk lessens with experience of shopping through direct channels (Hawes, 1986). This scenario seems to be playing itself out with regards to online shopping as well (Miyazaki and Fernandez, 2001; Vijayasarathy and Jones, 2000). A recently published study (Goldsmith and Goldsmith, 2002) found that online apparel buyers could not be distinguished by their demographics or their purchase of more apparel by other means. They shared similar attitudes toward online shopping with non-buyers but were not more innovative toward clothing and fashions than the non-buyers. Online apparel purchasers, however, did use the Internet more and were more innovative toward using the Internet than non-buyers were. These ndings imply that online apparel buying is motivated more by Internet innovativeness than by clothing innovativeness (Goldsmith and Lynn, 2004). It appears that being an Internet innovator and an experienced catalogue shopper are more predictive of online clothing shopping than an interest in fashion (Goldsmith and Lynn, 2004).Influence of Social Network on Online Fashion PurchaseSocial network online communities, such as Facebook.com and Instagram.com, serve as platforms where millions of consumers all over the world are connected with one another and exchange opinions, ideas and information (Park and Cho, 2012). In the case of Facebook.com, there were 55 million users as of December 2008 (Arrington, 2009) and the number increased to over 500 million in 2011(Facebook.com, 2011). Shared information among community members forms strong e-word of mouth effects that signicantly inuence retail sales and brand images (Brown et al., 2002; Flavian and Guinaliu, 2005). Utilizing the social network online community, retailers keep track of changes in consumers demands and shopping behaviors (Flavian and Guinaliu, 2005). Particularly, fashion and apparel shopping is suggested as one of the most popular discussion topics among social network online community members and apparel retailers could gain direct feedback from consumers while monitoring the discussions in social network online communities (Thomas et al., 2007). Many consumers visit a social network online community to gain apparel shopping information (Thomas et al., 2007). Social network online community as an information sourceOnline community was rst dened by Howard Rheingold (1993) as a social aggregation of people carrying out public discussions long enough, with sufcient human feeling, to form webs of personal relationships in cyberspace (p. 146).Bagozzi and Dholakia (2002) explained that an online community is the computer-mediated social space in which content is produced by members through continuous communication processes. A brand community, often established in virtual spaces, is developed by admirers of a specic brand, which can be either individuals or the company (e.g. Harley-Davidson, Apple Computer, i-Village, Nike, etc.)(Park and Cho, 2012). Brand communities for apparel products were often hosted by retailers who target for young generations (Kim and Jin, 2006). The major interactive communications tools in the communities were bulletin and message boards which induce the consumers participations (Park and Cho, 2012). Discussions about brands, designers, and retailers make the online community as an information center by creating strong word of mouth effect (Park and Cho, 2012).The importance of a social network online community as an information source will be more signicant because of the current size of the community users and the growth (Park and Cho, 2012). To current consumers especially those who are savvy to technology, a social network online community may serve as a major place to share and garner shopping information. One good example of this would be lowyat.forums.com.my where the users exchange information within their community. Marketing Strategies of Online Fashion ApparelsAn online brand is defined as a brand that has an online presence (Rowley, 2009). Chaffeys (2008) denition of online branding to propose that online branding is: How online channels are used to support brands, which in essence are the sum of the characteristics of a product, service or organization as perceived and experienced by a user, customer or other stakeholder. The growing recognition of the value of brands, especially in the retail industry (Ailawadi and Keller, 2004) and the status of brands as one of the four most popular discussion topics within a fashion and style discussion forum (Thomas et al., 2007) suggests that it may be timely to explore online branding in fashion retailing in more detail(Rowley, 2008). There is evidence to suggest that brand knowledge has a direct and positive effect on intention to adopt an online retailer (Chen and He, 2003) and that brand familiarity inuences purchase intention (Park and Stoel, 2005). Online branding more generally (or e-branding, digital branding, internet branding, or i-branding as it has variously been labelled) has also received relatively limited attention (Rowley, 2008). Online branding requires a review of established branding principles coupled with an understanding of the specic opportunities offered by the online channel (Rowley, 2008).The majority of research in the area of online fashion retailing has been concerned to better understand consumer behaviour, including the identication of online shopper characteristics and the examination of cross channel shopping behaviour (Rowley, 2008). Goldsmith and Flynns (2004) research on the psychological and behavioural drivers of online clothing purchase, showed that being an adventurous online buyer and a heavy catalogue shopper had the most impact on online clothing buying. Kim and Kim (2004) found that their transaction/cost factor and their incentive programs factor were important predictors of purchase intention. Similarly, Kim and Stoel (2004) conrmed the importance of transaction cost factors (e.g. credit card security, fast delivery time, privacy assurance, money back guarantees) over web site design features in perceptions of online clothing shopping attributes (Rowley, 2008).Park and Stoel (2005) found that familiarity with brands offered online, together with previous experience of shopping online, inuenced perceptions of the risk associated with shopping online, as well as intentions to purchase online.All of the UK non-value fashion retailers now have transactional web sites, and all top UK value fashion retailers have a web site that they use for communication and to establish an online brand presence (Rowley, 2008). Rowley (2008) also found that brand visual identity online is consistent with visual identity through other channels, and is applied consistently throughout web sites.Trends of Purchasing fashion apparels before and after the birth of Online ShoppingIt is now widely recognised that the internets power, scope and interactivity provide retailers with the potential to transform their customers shopping experience (Evanschitzky et al., 2004; Wolnbarger and Gilly, 2003), and in so doing, strengthen their own competitive positions (Doherty and Ellis-Chadwick, 2009; Levenburg, 2005).The internets capacity to provide information, facilitate two-way communication with customers, collect market research data, promote goods and services and ultimately to support the online ordering of merchandise, provides retailers with an extremely rich and exible new channel (Basu and Muylle, 2003). In so doing, the internet gives retailers a mechanism for: broadening target markets, improving customer communications, extending product lines, improving cost efciency, enhancing customer relationships and delivering customised offers (Srinivasan et al., 2002). By and large, consumers have responded enthusiastically to these innovations (Eng and Kim, 2006; Soopramanien and Robertson, 2007), and online retail sales have grown signicantly over the past 15 years and are predicted to continue rising into the future (Ellis-Chadwick et al., 2002; Ho et al., 2007).From the very beginning, the potential of the internet as a radically different and a highly effective communications channel appeared obvious: global reach, ease of access, enhanced interactivity, exibility and speed, ability to communicate large amounts of information, cost efciency and ease of maintenance (Pyle, 1996; Jones and Vijayasarathy, 1998). It was quickly recognised that it was amongst retailers that the most signicant impact of the internet was likely to be experienced (Doherty and Chadwick, 2010).Retailers soon realised the internets potential to provide information, facilitate two-way communication with customers, collect market research data, promote goods and services and ultimately tos upport the online ordering of merchandise, provides an extremely rich and exible new retail channel (Doherty et al., 1999). The commercial liberation of the internet networks in 1989 started the goldrush era of the internet (Brown, 1995). Auger and Gallaugher (1997) envisaged that the typical internet consumer would be better educated and more afuent than the average shopper. Burke (1997) suggested that internet shopping might be most appealing to those consumers who did not have much time or desire to go shopping. Other authors predicted that in an internet world, the balance of power may shift to the consumer (Bakos, 1991; Hagel and Armstrong, 1997), and in so doing, this would make internet shopping appeal to those who wanted to get the best value from their retail spend (McWilliam et al., 1997). Effective one-to-one marketing requires the capture of signicant quantities of customer-oriented information, so that their needs and preferences can be inferred, and then elements of the marketing mix can be specically tailored to these requirements (Arora et al., 2008). Online retailing is now providing retailers with the rich source of individualized customer data, that allows them to undertake effective one-to-one marketing (Frow and Payne, 2009) and in doing so make a very real contribution to improved organisational performance (Gurau et al., 2003; Schoder and Madeja, 2004; Warrington et al., 2007). A successful internet business must always be able to cover its xed costs and may often benet greatly from having a rst mover advantage (Earl and Mandeville, 2009). The Future of Internet RetailingIn the UK, it has been estimated that the number of customers being served by the UK online and catalogue retail industry, which currently stands at 26.9 million active online consumers, will rise to around 30 million by the year 2013, representing over half of the UK population (IMRG, 2010). Although Weltevrenden (2007) was clear that, as yet, the internet has had a limited impact on city centre stores, Doherty and Chadwick (2010) argued that it would seem inevitable that, in the longer term, the size and composition of the high street will be signicantly impacted, as online shopping becomes a far more mainstream activity.Given the consumers desire to use the internet as a exible tool for researching products and locating stores, as well as purchasing merchandise, it would also seem likely that the multi-channel format will be the preferred design (Hahn and Kim, 2009). Established retailers will inevitably continue to face stiff competition from the successful and high-prole virtual merchants and disintermediators, such as Amazon.com, Apple.com and Dell.com (Doherty and Chadwick, 2010). Kaufman-Scarborough et al. (2010) suggest that in future, this wealth of consumer-oriented data, will also allow retailers to better predict their customers requirements, and, in so doing, provide a better level of customer service. Social Media Influences on Online Fashion PurchasingAccording to Brown et al. (2007), word of mouth [WOM] has greater impact on product judgements, attitude formation, and decision making than formal marketing communications. This view is strongly supported by Trusov et al. (2009) who nd that word of mouth referrals have a more signicant impact on new customer acquisition, than traditional advertising mechanisms. An alternative, and perhaps more likely, scenario is that in the Web 2.0 era (Wirtz et al., 2010), in which social networking plays an increasingly powerful role, consumers will become less susceptible to the power of one-to-one marketing. Doherty and Chadwick (2010) argues that it is very likely that the power of social networking will continue to expand, and have a far greater effect on the modern consumers online shopping behaviour. as social networking is but one element of the Web 2.0 environment, retailers will also face increasingly intense pressure from consumers to: deliver a more authentic dialogue; provide opportunities to customise the interface and allow consumers to generate their own content (Wirtz et al., 2010). Doherty and Chadwick (2010) also stated that retailers will also face growing pressure from consumers to allow their services to be accessed exibly from a growing array of mobile devices, as they want to be able to shop on the move.It was prophesised that, at the very dawn of the online era, that the Internet would represent the most important wave in the information revolution (Evans and Wurster, 1997, p. 70). From the perspective of the here and now, and looking forward, there is plenty of evidence to suggest that this internet-enabled revolution has got much more life in it yet (Doherty and Chadwick, 2010). Task 5SECTION A:Personal DetailsInstruction: Please thick as appropriate that most closely match your personal opinions.1) Age: 17-21 22-26 26-30 30 ++2) Gender: Male Female3) Monthly Income Range: Below RM 1000 RM 1001 RM 2000 Above RM 20004) Are you a frequent user of social media (Twitter,Instagram,Pinterest,Facebook)? Yes No5) Do you have any experience through online shopping/ E-shopping for Fashion apparel? Yes No6) Do you have E-banking or cash deposit experience? Yes NoSection B:Please tick on the box on each line to indicate how much you agree or disagree with each of the following statementNo.StronglyDisagreeDisagreeNeutralAgreeStronglyAgree1Do you consider yourself a constant user to social media (such as Facebook, Twitter, etc.)?2You are more likely to shop online than going to an actual store.3You think that online store/ E-shopping could provide information in more detail regarding the products than an actual store.4Products sold online are much cheaper5Online store/ E-shopping is a convenient option for you to shop.6Any enquiries are easy to make via online.7You can get immediate respond from the customer service online.Section C:1. Do you think social media creates trustworthiness to the society? Yes No 2. Has social media influenced your buying decision/ behavior toward a product? Yes NoWhy? (Please defined in specific terms)________________________________________________________________________________________________________________________________________________3. In your opinion, online shopping/ E-shopping has becomes the stronger competitor than a store owned. Yes No4. Do you think social media is replacing the traditional marketing methods (such as personal selling, direct marketing, etc.)? Yes NoWhy? (Please defined in specific terms)___________________________________________________________________________________________________________________________________Task 6Limitations and ImplicationsThere are several limitations and implications in this research. The first main limitation would be the limitation of time. There is not enough time for the questionnaires to be given out to the students in SEGi College Subang Jaya. The online questionnaires were shared on social media such as facebook but the scopes of respondents were not wide enough. Only 60 respondents gave input towards the questionnaires thus this research needs more time to be completely filled. Another limitation would be that this research has limited resources. The exact social media that is being used to influence online fashion apparel purchasing cannot be detected. The data is only collected by survey, there was no actual interview or observation on respondents.ConclusionPark and Cho (2012) mentioned that social network online communities serves as a platform for millions of consumers to connect with each other and exchange opinions, ideas and information. Based on the research objectives and questions, the results of the survey has shown that social media heavily influences the decision to purchase an online fashion apparel. Entrepreneur.com (2014) stated almost every small business is on social media, and 94 percent of them use these social platforms for marketing purposes (attracting clients and building a brand), As social media usage becomes ubiquitous, the rate will only continue to grow, as more small businesses use Facebook pages and Twitter as their main platforms for communication, even more so than their websites. Many if not millions have already acknowledged the usages of social media towards not just online fashion items, but with other items as well that are available in the internet. With social media sites such as Instagram and Pinterest and many more to name, social media will be a big influence towards the online fashion retail industry. Task 7 REFERENCES/BIBLIOGRAPHY Park, J. H., & Stoel, L. (2002). Apparel Shopping On The Internet: Information Availability On US Apparel Merchant Web Sites. Journal of Fashion Marketing and Management, 6(2), 158-176. Retrieved March 24, 2014, from the Emerald Insight database Goldsmith, R. E., & Flynn, L. R. (2004). Psychological and behavioral drivers of online clothing purchase. Journal of Fashion Marketing and Management, 8(1), 84-95. Retrieved March 24, 2014, from the Emerald Insight database. Park, H., & Cho, H. (2012). Social network online communities: information sources for apparel shopping. Journal of Consumer Marketing, 29(6), 400-411. Retrieved March 25, 2014, from the Emerald Insight database. Rowley, J. (2009). Online Branding Strategies Of UK Fashion Retailers. Internet Research, 19(3), 348-369. Retrieved March 24, 2014, from the Emerald Insight database. Fogel, J., & Schneider, M. (2010). Understanding designer clothing purchases over the internet. Journal of Fashion Marketing and Management, 14(3), 367-396. Retrieved March 24, 2014, from the Emerald Insight database. Doherty, N. F., & Ellis-Chadwick, F. (2010). Internet Retailing: The Past, The Present And The Future. International Journal of Retail & Distribution Management, 38(11/12), 943-965. Retrieved March 24, 2014, from the Emerald Insight database. Post Smarter: The Best Times to Use Social Platforms (Infographic). (n.d.). Entrepreneur. Retrieved April 2, 2014, from http://www.entrepreneur.com/article/2326

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