1. Unit 3
Internet Consumers

2. Learning outcomes
Describe and understand the characteristics of Internet surfers and electronic commerce purchasers.
Understand the process of consumer purchasing decision making.
Id the consumer’s shopping procedure on the Internet
Understand the types of comparison-shopping aids

3. Definition of web activities
Information accumulation
Communication
Surfing
Shopping

4. Consumer behaviour online

5. Consumer characteristics
Age
Income
Gender
Demographics
Family & occupation
Education

6. Consumer characteristics
Demographics: Age
Younger users
They engage in more exploratory behaviour
They have low income levels
They use the Internet for communication activities
They have time on their hands
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7. Consumer characteristics
Demographics: Age
Older users
They use the internet for communication purposes
They are prime Internet shoppers
Their usage of the Internet depends on their personality characteristics

8. Consumer characteristics
Demographics: Gender
Female users
They are more likely to engage in exploratory behaviour
They spend less time online
They buy less online
They are cautious online, especially in terms of privacy and security issues

9. Consumer characteristics
Demographics: Gender
Male users
They spend more time online
They buy more online
They are more liberal with their private information
They are more likely to take action when they feel their privacy have been violated

10. Consumer characteristics
Demographics: Education
Internet users have been characterised as having a higher education level than non-users
Higher levels of education reduce technology and computer anxiety and create a more positive technology schema

11. Consumer characteristics
Demographics: Income
Internet users have been found to have higher-than-average-income
Higher incomes are associated with higher levels of education
Income levels provide an indication of whether basic Internet access can be afforded
And indicates access to credit facilities

12. Consumer characteristics
Demographics: Family composition and occupational status
The presence or absence and the age of the youngest child influence the users’ use of the Internet as a shopping tool

13. The Digital Native Alphabet
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14. Consumer characteristics
Technology readiness
innovativeness
Personal characteristics
Gregarious
ness

15. Consumer characteristics
Personal characteristics: Consumer innovativeness
Defined: It is the degree to which an individual is receptive to new ideas and makes innovative decisions independently from others

16. Consumer characteristics
Personal characteristics: Consumer innovativeness
General innovativeness
whether a consumer will try new things
Domain specific innovativeness
Focuses on the consumer’s affinity towards one domain or one category

17. Consumer characteristics
Personal characteristics: Technology readiness
Defined: It is the extent to which an individual is open and receptive to new technologies
People with this trait usually exhibit a willingness and desire to be at the foreground of technological change

18. Consumer characteristics
Personal characteristics: Technology Schema
Related to technology readiness is technology schema
Technology schema defined: It is an organised and arranged set of expectations and beliefs that one holds about technology

19. Consumer characteristics
Personal characteristics: Gregariousness

20. Consumer characteristics
Personal characteristics: Gregariousness
People who are unable to have proper social relations offline are able to spend time communicating with others online by using:
chat rooms,
discussion forums &
listservs
There is a belief that the Internet acts as a surrogate social network

21. Personal characteristics: Gregariousness
An example of a forum

22. Consumer characteristics
Consumer lifestyles
Defined: It is the activities, interests and opinions of consumers – in sum, their “pattern of living”

23. Consumer characteristics
Consumer lifestyles
Four important factors influence consumer lifestyles:
Attitudes towards technology
Time pressure
Occupational demands
Stage in the family life cycle

24. Consumer decision-making

25. Levels of decision-making
Consumer decision-making can be viewed in terms of three levels:
Routine decision-making
Limited decision-making
Extensive decision-making

26. Levels of decision-making
Routine decision-making
Mundane purchasing by the consumer that requires very little thought process

27. Levels of decision-making
Limited decision-making
Limited decision-making – It involves a greater number of thought processes

28. Levels of decision-making
Extensive decision-making
Extensive decision-making – It involves a great deal of search, a large consideration set and a far-reaching evaluation of alternatives

29. Role players in consumer purchasing decision making
Initiator-suggests/thinks of buying a particular brand or service.
Influencer-advice/views carry weight in making a final buying decision.
Decider-makes a buying decision or any part of it.
Buyer-makes the actual purchase.
User-consumes or uses a product or service.

30. Environmental/social characteristics
Language/culture
Store, product and service characteristics
Environmental/social characteristics
Access

31. Environmental/social characteristics
Store, product and service characteristics
Type of goods
The type of product, service or information will influence consumer behaviour
Products have different characteristics

32. Environmental/social characteristics
3 criteria that determine consumer behaviour :
Experiential = need to experience product first, e.g. food, books, CD. – only info goods are easy to sell on net.
Search = need to find info first e.g. insurance – easy to sell on net.
Credence = need repeated use before effects felt, e.g gym

33. Environmental/social characteristics
Store, product and service characteristics
Brand
Brands provide assurance of quality and recourse to established companies
Brands are information processing short cuts
The brand represents a safe choice
Brands are important when dealing with experience and credence goods
Brands are used as time-saving devices

34. Environmental/social characteristics
Guess the Brand

35. Environmental/social characteristics
Store, product and service characteristics
Offline presence
A store’s offline presence is important to many consumers
It provides assurance that the consumer is dealing with an established dealer

36. Environmental/social characteristics
Store, product and service characteristics
Variety
The variety of goods offered online is an important consideration for Internet adaptation in any country

37. Environmental/social characteristics
Language/culture
The presence of information in consumers’ own language and about their own culture and country on the Internet has a large impact on whether or not they use the Internet

38. Environmental/social characteristics
Access
Where the consumer accesses the Internet influences their behaviour
Most South Africans access the Internet from work
Access to credit facilities also play an important role

39. Purchase detractors: perceived risks
The greatest barriers to Internet use are security and privacy
Cybercrime defined includes Spam and outright fraud

40. Purchase detractors: perceived risks
Due to the large number of possible cybercrimes, consumers are concerned with:
Security and confidentiality of transactions
Supplier authenticity
Trust in suppliers
The ability of suppliers to deliver the product or service promised
The legal enforceability of contracts
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41. Purchase detractors: perceived risks
Other barriers to consumer adoption of the Internet are:
Conservative shopping habits
Limitations in bandwidth technology
Long download times
Lack of e-tailer profitability
Distribution problems

42. Online communities The Internet differs in that it is a
One-to-one medium ( )
Many-to-many medium (chat-rooms)
Technology has facilitated the creation of new communities, where people discuss issues with each other without being bound by geography

43. Online communities
Both online and offline communities can be viewed as groups linked by social relationships and a sense of belonging or by common bonds and a sense of shared identity

44. Online communities
Not all members of Internet communities are influenced equally
Lurkers – They follow the discussion online, but never interact with fellow members (others might not even know the person exists)

45. Online communities
Posters – They participate in the discussions by posting messages to listserv, chat rooms, bulletin boards or discussion forums
Posters are more influenced by the opinions of others, develop relationship with other members and see themselves as members of the community