1.1: Overview of the Chapter
This chapter presents the background to the study, introduces e-commerce and how to develop desire for online products. As well, the chapter presents the statement of the problem, objectives to the study of the study and defines content words used in the study. The chapter is essential as it provides the gap that this study comes in to fill.
1.2: Research background
Since the invention of the world wide web, internet has become an integral part in our day to day lives. Business sectors have as well taken it upon themselves to utilize this platform in conducting business. Shopping online has become a daily routine and business take it upon themselves to invest in those methodologies that are going to influence consumers hence increasing sales volume. The availability of digital marketing has enable consumers to engage in purchases from different geographical positions, without having to move to stores, and at any times of the day. This robust use of internet in conducting business has led to development of different factors that can be said to influence customer’s decision to purchase a particular product.
This thesis is a study of factors in digital marketing that have influence on customer’s decision to purchase a particular product. There is a fast increasing numbers of online consumers and online shoppers requires retailers to pay more attention to the varied factors that are said to influence customers purchase intention. The thesis focuses on e-0wom, brand image price and perceived risk as factors that help consumers form ideas on quality of products and eventually develop a decision to purchase online products. Purchased intention is in many circumstances measured by the consumers on various factors. Wallace (2019) posits that in the year 2019 was one of the many inventive years for those who conducted e-commerce. Actually, according to clement, (2019) online shopping takes lead among all activities conducted online with the fast growing online retail market being India then Spain and lastly china. This research associates this growth to the ability to constantly access internet by consumers due to advanced technological developments. Most people access these online shops through their phones
The above drawings are statistics on expected percentages of e-commerce in retail businesses and as noticeable there is an increasing trend in number of persons engaging in e-commerce. Many researchers have asserted that there are major transformational changes in the business sector due to technological advancement and this is expected to rise in future years. Carrying out business via online stores has recorder lots of benefits to the business sector. This is because with recent technology persons spent their time more on internet and very essential for business persons to utilize this platform to reach these persons. Actually it has come toe point where we cannot come to imagine of a life without technology a report by Sharma (2018) posits that e-commerce is expected to get advanced and grow to the profits of trillion dollars by 2020. Through e-commerce customers enjoy a wider variety of products as people can visit more than 6 websites in few minutes which is better than having to move from shop to shop looking for a desired item. As well this type of conducting business lowers cost and time of travel as compared to traditional shopping. More than all other advantages the ability to retain customers is very important to this study as it here where this study comes in to focus on factors influencing digital marketing purchase intention.
Developing Online Business
For online business to blossom to this extend online retailers have had their role in attracting and even maintaining these online consumers. Before they develop the intention to purchase there are those we can term general ways of attracting online customers. Schenck in “ten ways to attract new customers to your online small business” posits that even when it looks simple, it is always a complicated procedure and a sophisticated one to initiate, come up with an e-commerce plan and means to protect online reputation as well as maintaining alongside attracting more customers. Even when it is easy to find an online business retailer should always learn all those strategies that protect them and keep them away from being exploited or even cyber bullied at the expense of their own business hustles. Retailers should always ensure they have accessible and easy in a way to access links. This way customers will find them through these accurate links and develop business relation with them. As well customers should ensure they have an increased and improved online presence. Why so? We all know that many time we log in to social media when we are free unless it is on business appointment. Most of these times could be at night. If businesses are thuds accessible at all times, then it makes it easy for them to be found and engaged in matters business.
It is always good for businesses to establish an identity and for that matter a single domain name. This helps those identifying you easily find you as well as those who may be coming back for repurchase. It is always essential for businesses to develop a very good introduction or d3escription to their business for first impression purposes. In this descriptive introduction, tell online user for what purr [poses your business is created and for whom. As well ensure you deliver the same described products to the vest quality. This helps develop trustworthy, become likable and stand out amongst many other competing businesses. It helps a business sell out. Business person to conduct all these descriptive preliminaries, should have an easy to search website carrying a domain name. Always as well ensure you remain active across social media platforms and also one can develop a content sharing platform alongside monitoring one’s online reputation. These are the preliminary approaches that retailers need to engage in before even understanding the factors that influence digital marketing purchase intention and those that are here in under study.
In conclusion many researchers have immersed themselves in the research on cereal e-commerce and how to establish a good business in virtual world. This opens gas [pa in study that leads to researches like this thesis that explains factors in digital marketing that influence purchase intention. It is good to understand that purchase intention is very paramount in any business in world as, as attested it is the same that states the amount on energy required in a particular business field in order to have a busies flourish. Purchase intention is something that is inward that is influenced by other factors in order for consumers to portray some purchase behaviour. It is however observable form the interest that consumers portray on products they wish to purchase, it is essential for business persons to observe this behaviour and if possible obtain either observable or told reasons as to why customers may have established willingness in purchase products. This way customers will invest more on those factors that might have influence consumers and in the event attract more customer hence maximize profits. This study is thus very important as it will open the minds of new and existing business persons and customers on those factors that they need to pay attention to ignored to increase sales volumes and increase purchase respectively. The next section outlines the problem statement in specific. It clearly outlines what this study is all about.
1.3 Statement of the problem
The internet is a technological advancement that has greatly contributed to business blooming nowadays. Alongside the many persons that have taken advantage of the virtual platform to carry out varied actives, business persons have embraced it as well. they realize that there are potential persons online and have even designed websites that enable them to purely carry out business and maximize profits. however, many business persons operating online have little knowledge on the different factor that may influence online consumers. this research thus comes in to present the various factors that contribute to developing of purchase intention among online customers. Many researchers have come in to study importance of the business online program with a few paying key attention to factors affecting purchase intention among customers. This study is thus coming in to close this gap by focusing on factors in this digital marketing that influence purchase intention among customers. The factors that this study finds very crucial are e-Wom, perceived risk, price and brand image that lead to customers having a perceived quality hence developing an intent to buy products
1.4 Research Questions
Based on the statement of the problem, the following are the research questions that guide this study:
- How does e-worm affect purchase intention in digital marketingt ?
- What is the effect of price on purchase intention of online consumers?
- How does perceived risk affect the purchase intention of online consumers
- Does brand image have influence on online consumers?
- Does perceived quality influence the decision to purchase products in digital platforms?
1.5 Research objectives
This study is guided by the following objectives;
- Investigate factors influencing purchase intention in digital marketing
- Investigate how perceived quality is a mediator variable to purchase intention
- Critically examine the extent to which e-Wom, price, perceived risk and brand image influence decision to buy goods online.
1.6 Scope of the Study
On account of the described problem formulation, the scope of this study is the factors influencing purchase intention in digital platforms. Three research intends to examine the influence that these factors have on the perceiving of the quality of a product which lead to a decision to conduct online purchases. On examining these factors, the study aims at setting light on different methodologies that online business person can take in police in order got increase sales volume and maximize profit.
For academics, the results of this study should coime in to fill a gap created by critics who have majored on researcheds on the perceived usifulness of digital platforms and not the importance of factors influencing digital marketing in the owrld. The findings of the study will be useful to the both existing and upcoming online investors as they will know all those factors they should bring on board in order to cover a wider scope. As well the study will be informative to other critics who would like to extend or carry out a research on digital marketing.
1.7 Significance of the Study
Today’s consumers have an abundant store choice when it comes to access of sold products. Actually most are spoiled on choice with majority opting to use virtual platforms in purchases (broekhuizen,2006). This advent of various channels has such as mobile and e-commerce hassled to a corresponding increase in completion among channels and thus making it very crucial for business persons to understand what motivates or influencers consumers to develop purchase intentions. As well scholars have asked researches to find out why consumers prefer one channel to the next (black et al. 2002; Gupta, Su and Walter, 2004; and shchoebachler and Gordon 2002). This research comes in to respond to this calls as well as enhancing the conceptualization of purchase behaviour by outlining the varied factors that move customers to decide to purchase particular products through virtual stores. As well the study contributes top existing and extant literatures in commerce by exploring purchase intention and factors influencing it. For a more realistic setting the researcher asked the users of particular websites and similarly consumers of the goods sold through these websites to explain the varied factors that helped them develop intentions to buy goods online. Moreover, these consumers and on-line shoppers are expected to explain the difference between availability of those factors and their non- availability in order to authenticate the developed purchase intention.
1.8 Definition of Terms
- i) Purchase Intention
Lu, et al (2014) defines purchase intention as the willingness and desire to purchase a particular product by consumers., many scholars have done out researches and found that having a desire to purchase eventually results to developing purchase behaviour. Actually, purchase intention is a wide world used tool that estimates the effectiveness of strategies of marketing which are mostly helpful when sellers are predicting sales and market share. As well the same purchase intention helps consumers to forecast future behaviour of consumers and come up with best marketing strategies that influence consumers. It is every essential for marketers to make decisions regarding new and future products.
- ii) E-Wom
Cheunga and Lis (2012), argue that e-Wom is a very essential component in promotion of business. This are abbreviations to electronic word of mouth. This is defined in buzz talk as a form of buzz marketing which can become viral if it is found persuasive and even comical. This is conducted through a person to another’s contacts found on internet. Businesses have learned the importance of e-Wom and most of the have even employed persons to run their virtual business world.
iii)Brand Image
This is defined as the general impression that a product holds as perceived by potential or even real customers. It is usually the perception that brand has in the mind of customers and can be summarizes as the ideas, aggregate beliefs, or the general impression that a customer holds towards a particular brand. Since the perception of an image is relative then it is not easy for a business to form that consistent brand that appeals to all customers. A good brand image, shapes the consumers perception of an organization. Reputation is not solely built by the organizations communication, which is difficult to manage according to Money and Gardiner (2005) but also by the brand image. many customers know the advantage of this and have therefore invest in good designers who help them come up with good images for their product. alongside attracting other customers this helps match or beat market competitiveness.
iv)Perceived Risk
This is said to be the uncertainty that a consumer has when buying a particular product especially the expensive products. It involves all the doubts that consumers have before fully developing an intent to purchase a particular product. Lake (2019) posits that perceived risks can be due to the functionality of a product, the social standing of customers, financial status, the physical or even can be affected by time the product or a prior purchased product served a customer.
iv)Perceived Quality
Aake, (1991) argues perceived quality is a vital aspect of brand equity. According to Zethaml (1988) perceived quality is not necessarily the real quality of a product or service but rather how the consumers feel and evaluate a product. This in this study is discussed as a mediator variable. This is to mean that after e-Wom, brand image, perceived risk and cost of product, customers develop a tentative idea on its quality and the make a decision to purchase the product. It is defined as the customer’s perception on the overall quality of a product with respect to what it is intended to perform. Perceived quality is determined on basis of products performance, features, reliability or durability, price, e-Wom or even perceived risk. This qualifies it to be a mediator variable one that links the different factors here in under study to the dependent variable, that is purchase intention.
Vi) Product’s Price
This is usually the money that every customer should pay for a product or service. Sinha in ‘Price of Products Definition, Factors and Other Detail” avers that price can go by various names such as, freight, fare, tuition fee, professional charge etc. while in business it is purely the money given in exchange for a particular product.
1.9 Organization of Thesis
Chapter One of the study is the introduction. This chapter provides more importantly the statement of the problem and objectives of the study.
Chapter Two of the study is the literature review. This chapter presents review of extant literatures on all variables and presents the theoretical underpinnings used for this particular research
Chapter 3 of the study presents the research methodology. It presents a summary of hypotheses and methods of data collection and data analysis. As well the chapter presents the testing of the hypotheses details.
Chapter Three is a discussion of data collected and analysis
Chapter Four presents the summary, conclusion and recommendation.
1.10 Summary
Chapter one is always a very important chapter in any research. It is the chapter that gives readers direction or introduces understanding of integral points used in the study. The chapter one in this study has introduced us to e-commerce provided the statement of the problem and the objectives that this study seeks to achieve
CHAPTER II LITERATURE REVIEW
2.0 Overview of Chapter
In this section, I am going to present are view of extant literatures on factors affecting purchase intention in digital marketing; identify those literatures that help me create a gap in stud as well those that inform this study. Literature review is a very essential part in any research as it opens a researcher’s mind to the world of existing information on available topic and also help in identifying the areas where primary data shall be collected in plenty as well as particular research is concerned. In this particular study, it is here where secondary data is most existent as the primary data gets presented in following sections. This section begging by discussing the theoretical framework used in this study and presents available knowledge on all the variables used in this study. Both the dependent and independent variables.
2.1 Underlying Theory
The theory of planned behavior is an expansion on the theory of reasoned action (TRA) which was first introduced by Fishbein and Ajzen in 1975. It predicts ones intention to engage in a behavior. The key component of this model is behavioral intent. This theory has been used in different fields such as health, informatics, and advisements among others. It deals with behaviour and believes of individuals. The theory of planned behaviour is an approach used to determine behavior and adoption intention towards technology. It was developed out of the principle of aggregation, a model which states that the collection of specific behavours across occasions has better predictive validity of attitudes. According to Ajzen, (1991), it seeks to explain ones motivation towards a product by explaining the execution of a certain behavior.
Ajzen (1991) suggests that the stronger a person’s intention to engage in a behavior, the more likely the behavoiur will be performed. The behavour must be under a person’s volitional control, or will, to decide whether or not to perform the behaviour. Edberg (2015) also says that TBP can be integrated with the theory of technology acceptance model as both explain the attitude towards behavour by consumers. Ajzen (2010) states further that the environmental engagement with the world around someone will build a perception and make him /her perform the behaviour. The more one is attached to the environment the stronger the perception formed and drive to conduct behavior. It should be clear at this point that technology is a number one innovation at the market place and therefore everyone in their environment is bound to keep up with the pace by adopting the use of internet to share information and communicate.
Ajzen says that perceived behavior controls an individual’s evaluation of the ability to engage in the intended behaviour based on his/ her perceived power, or perceived difficulty or ease of performing the behavior. The figure below represents the basic TBP model
This theory is anchored on three determinants of intentions namely; the attitude towards the behaviour ( the degree to which a person has a favorable or unfavorable evaluation of the behavour in question. The second is subjective norm which is a social factor referring to the perceived social pressure to perform or not to perform the behaviour. And the third is the degree of perceived behavior control which is defined as the perceived ease or difficulty of performing the behaviour and it reflects on past experiences. These three aspects shape the prediction intention and it varies across behaviors and situations.
The underpinnings of this theory are very informative in analyzing the content under study since purchase intention is all anchored on an attitude which is created from social factors and finally determines the degree this developed behaviour is taken to. Just like Ajzen argues that apperceived behaviour controls an individual, salary purchase intention controls a person and from influence of things like quality, image, price and perceived risk and finally online consumer settle for the decision to execute the intention they initially had of purchasing. The following the section in depth reviews these other variables from which purchase behaviour is built.
2.3 Specific Issues.
This study is a study of digital marketing factors that have influence on purchase intention. The dependent variable in this study is purchase intention that is dependent on quality of products, price, brand image and perceived risk. Customers consider all these factors before developing the interest to purchase goods. Conversely this study presents brand quality as more of a mediator variable than an independent variable in determining purchase intention. Brand equality is arrived at after looking at the price, brand image and perceived risk. After accepting the quality of product then customers make a decision to purchase products.
2.3 Dependent Variable
2.2.0 PURCHASE INTENTION
Intention is defined by Rezvani as the behavior that inspires or leads to one to perform some action (Rezvani et al., 2012). Customers always have needs and this result to the step of buying goods or paying for services to meet certain objectives in their lives, this is what purchase intention is all about. Lin and Lu in their study say that purchase intention ‘is an act and physiological action of purchase towards a product (Lin & Lu, 2010).
This is the implied feeling and promise that one has towards certain products in a market ( Fandos & Flavian,2006), Halim & Hameed, 2005). The company’s desire always is to increase sales of certain products and thus the urge is of substantial importance to the companies to enable them maximize on profit.
Through purchase intention a company is able to depict the retention of customers. A good producer or company has to observe several aspects to enable them retain most of their customers if not all. This includes the quality of products, the brand image, knowledge that the consumers have about the product, product loyalty and attributes.
Consumers usually purchase products after an evaluation. Many factors affect the intention which consumers have when selecting or choosing products and the final decision usually depends on the consumer’s intention determined by large external factor (Keller, 2001)
Witt and Bruce (1972) say that the decision making concerning the purchase of products is affected by a group in choosing the brand for products one is familiar with “Information about a brand that has been used by other group members also affect the decision to skip the existing brand and more to those that are used by other members (Witt, 1969).
Satish and Peter (2004) in their research explain that information about certain products by the consumers play a very big role in influencing the customer in making choices on the products of their taste. Other studies argue that knowledge of the product is the main factor considered in product purchasing selection. This is much likely to be influenced by the kind of packaging. Packaging makes products unique from others and this is the one factor that all companies employ to attract consumers to pick on their products (Rao & Monroe,1988).
Fung et al. (2004) revealed that the feelings that consumers have are attached with how the product is designed and packaged. The packaging of the products also build the company’s goodwill as well as giving information to the consumers ion the quality of the product (Dileep,2006).
Another factor of purchase intention as outlined by Payne & Holt (2001), is on the perceived value which shows the relationship the product and consumers have. Tung et al., 1994), concludes that ‘’higher perceived value results in higher intention of the purchase.
2.3 Mediating Variable
2.3 0 PRODUCT QUALITY
Aake, (1991) states that perceived quality is a vital aspect of brand equity. According to Zethaml (1988) perceived quality is not necessarily the real quality of a product or service but rather how the consumers feel and evaluate a product; ‘consumers subjective evaluation of the product’’’. It is therefore a necessity for one to understand the importance of perceived quality in order to survive in a competitive environment.
It is a common thing in most companies nowadays to base their strategies on consumer-driven value so as to satisfy the customers’ needs and also produce products that have a high quality. Kotler (2000) says that there are several connections that need to be looked at critically; the quality of products and services, consumers’ needs as well as attaining the company’s set profit.
2.4 Independent variables
2.4.0 E-WOM
Communication takes place in varied ways, it could be orally or written. One of the oral communication techniques is by word of mouth. Information can be shared orally in a social setting or in a circle. This is one of the means considered informal means of communication. Consumers usually discuss products and services and through this some products due to consumers; preference is likely to be bought more than others. Electronic word of mouth according to Nguyen and Romaniuk plays a great role in ‘promotional part of marketing (Nguyen and Romaniuk, 2014).
Technology and internet have contributed much in the marketing world. Arndt (1967), defines e-WOM ‘’as all informal communication directed at consumers.’’ This could be effected through the use of internet of certain goods and services.
The word of mouth through electronic media has a great association to viral marketing. To achieve this kind of marketing the internet is an important aspect. Godin(2oo1) defines the word viral as a ‘’big idea that runs amok in the target audience, a fashionable idea that propagates through a segment of the population, teaching and changing and influencing everyone it touches.
According to Cheunga and Lis (2012), purchase intention ‘’is the extensive outcome variable of electronic word-of-mouth communication. In their study, they expanded on purchase intention as an outcome of e-WOM. The characteristics of –WOM as studied by various researchers include the quality of products as well as the quantity. Relevance too is mentioned as one of the features and the effects of the above mentioned characteristics on the purchase intention (Lin et al.,2013).
Wolny and Mueller (2013) analyzed motive consumers engaging in electronic word-of-mouth in context of fashion brands on social networking sites by using an extended Theory of Reasoned Action (TRA) model. In another study Teng et al., (2014), found that quality, credibility, source attractiveness and style are important factors of electronic word of mouth message which customers use to make their future purchase decisions.
In a recent study, Vahdati and Nejad (2016) also confirmed e-WOM having a positive and significant effect on the purchase intention of bank customers. Hence, e-WOM among consumers significantly affects their purchase intention in social networking websites.
2.4 1 BRAND IMAGE
This has to do with the trust and reputation of a company or firm with the consumers the image about a brand is what is said or believed about a product or the company itself. A negative reputation can damage an organization as it leads to decline in sales hence losses or collapse while a positive reputation is a building block of a company. This shapes the consumers perception of an organization. Reputation is not solely built by the organizations communication, which is difficult to manage according to Money and Gardiner 2005. Reputation is also impacted on by word of mouth i.e. Communication from a third party which a consumer relies on than the organizations communication. This kind of communication can also be online or face to face between consumers of goods from a company. The brand image affects the consumer’s attitudes and behaviour towards the company or firm. Schurr and Ozanne 1995 say that trust can lead to favourable or unfavourable attitude towards the firm or company. In digital marketing there is no physical salesperson present in the buying process and this means that the organization becomes a target of the consumers trust (Chow and Holden, 1997; 278) it means that organizations providing services online will lack support from consumers if they cannot create a sense of trustworthiness. Jarvenpaa et al argues that “for trust to exist, the consumer must believe that the seller has both the ability and the motivation to reliably deliver goods and services of the quality expected by the consumer”. This however is not an easy task considering the absence of a physical salesperson and that different consumers have their own preferences which are not easy to meet perfectly. Consider for example an organization dealing with food deliveries. It therefore means that a consumer’s trust will be directed towards the organization itself rather than an individual. Trust has an important role in establishing a relationship by decreasing risks involved in a digital transaction which tend to be effortless. If this is the case, consumers would be comfortable with online and digital making as it is at their convenience. However the opposite could also result due to low trust of the consumer towards brands and organizations. Trust reduces the feeling of perceived risk and increases the consumers’ belief about a brand or product as well as web site of an organization.
Hoffman et al (1999) say that the amount of trust the consumer has in a brand mainly through how the company will deliver goods and use the personal information will influence how likely it is that the consumer will purchase a product from the website. It can be once or regular purchases. It can therefore be hypothesized that the brand image a company portrays can either have positive or negative effects on the digital purchase intentions.
Brand image is what sells or demolishes a company or organization doing online marketing. By word of mouth a company’s products or services can be promoted hence increasing sales due to many purchase decisions from consumers. (Price and Frick, 1984) say that word of mouth could be the only source of information a consumer needed in order to try a specific service provider since this is what makes a company more credible than commercial advertisement hence impacting on a consumer’s decision.
2.4 2 PERCEIVED RISK
Perceived risk affects consumer purchase intentions. It is an important factor in digital marketing and online shopping because consumers do not meet face to face with a salesperson and have to rely on technology to work (Jarvenpaa et al 2000; 46). There is a risk associated with digital purchase since if anything wrong happens in the process the consumer can face psychological, financial, social and physical losses(Im et al 2007; 2). Therefore trust is the solution for the problem that are initiated by perceived risk (Kim et al 2008; 547). Perceived risk is will be decreased by the good reputation that a company has and the trust the consumers has built on it. This increases the purchase intentions both online and offline. It is not easy to make an active decision to buy a product or purchase a service one has to consider many personal factors and to an extent of taking risks. This is so because one is making purchases without even knowing or seeing e warehouse but depend on information provided by the service provider. By taking a risk to purchase a product or service the perceived outcome of the product determines the consumer’s satisfaction with the purchase. If the consumer’s expectation is matched by the perceived performance of the product, he / she will be satisfied. A purchase can result into different outcomes; the consumer is either disappointed, satisfied or delighted (Kotler 2003; 124).if a consumer is disappointed, the performance of the product was worse than expected, if satisfied the [performance of the product met the expectations of the consumer. And if delighted the performance exceeded the expectation of the consumer (Kotler 2003). Hence it was worth the perceived risk. To determine the post behaviour risk is the satisfaction a consumer gets. As it determines the word of mouth spread to other consumers. Satisfaction and delight as well leads to a repeat of purchase. Dissatisfaction in turn leads to a decrease or reduction in purchases from the company due to negative word of mouth. perceived risk leads to sellers and buyers opting to sell customized products and this only increases customer due to achievement of customer satisfaction. in the next section I will briefly discuss customer satisfaction in order to shed light on what customer satisfaction all entails. I will also shed light on the reasons for increasing desire to customize products.
2.4.3 PRICE
Munnukka (2008) posits that customer’s intention to purchase a product are highly affected by the products price. Price is among the biggest determinant so of effectively marketing a product (Nirushan, 2017). The critic further avers that price premium can be a double edged sword in that it can act as a barrier toy developments of purchase intention or even catalyze the desire to purchase product. Customers use price premium to gauge or form opinions of on the taste and even quality of products. (Shaw et al 2007) it is this perception on quality, that this study argues, that later leads to development of purchase intention a particular product. Different critics have argued that many customers found high price as an indicator of good quality and used this perception to show a positive purchase behaviour. Wanninayakae W.M. CB (2014) posits that there is positive relationship between the intention to purchase a product and the price that such product carried. This was in a study of relationship of purchase intention and price of organic rice. Even when it was termed environmentally friendly. This study finds these findings by these critics very essential and borrows from them in proving that there is correlation between price and purchase intention further that study emphasizes that product’s price leads to determination of products quality hence the birth or death of a desire to purchase a product.
2.5 Research Framework
A hypothesis which Kumar (2011) posits that is very crucial in any study is defined by Sekaran (2010) as a logically assumed relationship between variables in a study. This is usually testable during the actual research. Though often speculated, researchers go out there to carry out a researcher in order to authenticate their assumptions. Before the actual research process, a researcher assumes several outcomes that stand to be proved after the actual research has taken place. The answers of the research come to answer the research questions.
For this particular research, the hypotheses formulated is based on existing knowledge and theory that guides this study and in line with the research problem and objective I come up with the following framework that guides this study
Figure 2. Research Framework
2.6 Hypothesis Development
On Account of the above proposed model for this study, I came up with the following hypotheses based on factors in digital marketing that influence purchase intention. the hypotheses were based on both the dependent and independent variables in this study.
H1 Brand Quality Is Determined from Different Perspectives and Influences Purchase Intention in Digital Marketing.
Dontigney in “brand image influence on purchasing intentions” argues that all experts advise all business owners to always protect their brand image. He posits that business owners should get rid of all the fears on why they should mind their brand image and understand that this image greatly influences the decisions that customers have on buying of products. According to this scholar brand image sums up all perceptions on product and the perceives image entails all strengths and weaknesses of a product hence of what quality a product may have. When consumers finally perceive of what quality a product is then they develop an intent to purchase. These arguments lead us to the below hypothesis used in this study.
H1 brand quality is always perceived as a result of knowing the products price, perceived risk or being informed by other product users
H2 Electronic Word of Mouth Is Very Essential and Boosts Online Business
Researchers have argued that electronic world of mouth greatly influences consumers purchase behaviour and even attitudes towards a particular product. Chowdhury (2016) argue that organizational have developed skills of being critical in advertisements and one of the is investing in electronic word of mouth. Electronic word of mouth achieves far much benefits in comparison to traditional word of mouth. This study is thus crucial as it comes in to investigate how influential word of mouth is tin developing consumer’s purchase intention. This study therefore assumes that;
H2 electronic word of mouth is very fast and inessential in maters developing purchase intention
H3 Perceived Risk Is a Determinant of Development of Purchase Intentions by Customers
Perceived financial risk is said to have a direct negative effect towards consumers purchase intention. Arriffin (2018). There are varied types of risks and all these have effect on purchase intention. Arriffin discusses them as time, security, product, psychological among other risks. Based on these risks a consumer is likely to have their purchase intentions affected if they experience any of them. This study based on the below assumption studies how perceived risk affects purchase intention among online consumers
H5 perceived risk is directly related to desire to purchase online products
H4 Purchase Intention Is Influenced by Brand image
Banjarnahor & Dachyar (2017) postulate that there are varied benefits of e-commerce and it has varied positive effects that should be embraced. To add on that, they have carried out a research on “factors influencing purchase intention towards consumer-to consumer e-commerce”. Here the argue that business persons should pay key considerations to the many factors that affect or influence the decisions customers make in purchasing a particular product. Amongst the factors that mostly affected customers purchase intention were risk and trust. This study discusses besides these factors, other factors that influence this purchase intention which is the dependent variable of this study hence the following hypothesis
H5 Purchase Intention Is Influenced by Products Price
Munnukka, Juha (2008) argues that customers purchase intentions are greatly a reflection of purchase intentions. By use of multidimensional pricing schemes this scholar notes that customers were greatly influence by the price tags on products. Those that deserved particular prices according to customer’s perception were highly purchase. A. Price as well spoke to the quality of a product and the decision was finally made on oaf to purchase a particular product. This research investigates how price affects price by drawing from the following assumption;
H5 price of product highly influences the decision to purchase products online
2.7 Summary
In conclusion and as well as in review of the presented extant literature in this section, there is a cognizable need to study the factors that influence digital marketing. as noted these concepts or variables presented are broad and need to have their interrelatedness studied. this in this research shall be carried out in a well presented methodology that shall be detailed in the next section.
CHAPTER III RESEARCH METHOD
3.0 Overview of Chapter
This chapter details the methodological approach applicable for this study. This research methodology is guided by research problem. To begin with the chapter outlines the population and sampling procedures, different methods used in data collection and how the same data is analyzed. As well this chapter outlines how the study approach helps validity and reliability of the study.
3.1 Research Paradigm
Kivuna & kuyini (2017) define research paradigm as a term that is majorly used in describing a researcher’s world view. To them a worldview is school of thought or even thinking or shared beliefs that informs meaning of research data. Amongst the different available research paradigms, this study is inclined to positivist paradigm due to its emphasis on empirical hypothesis testing. The Hypothesis testing is carried out through measuring of the variables under research and analyses data using statistical methods. This study centers on investigating factors in digital marketing that influence purchase intention of online consumers. Under positivist paradigm, the research believes that there is one reality and can be understood by use of quantitative procedure. This research therefore focuses on reliable tools to measure this truth. It focuses on using quantitative approach, that centers on sampling, measuring and scaling statistics, use of questionnaires and focuses on specific group that is online consumers. The research is kind of explanatory research model and very useful in analyzing the effect one variable has on another variable by concentrating on empirical testing of hypothesis (cooper and schindler 2001; in creswell 2012). In line with the studies objectives and research questions I focus on the quantitative approach malhotra (2010:171) posit that quantitative research is one methodolgy that seeks to quantify data and uses statistical analysis. This study applies quantitative method to investigate the factors affecting purchase intention in didgital platforms.
By it being explanatory kind of research, this resarch majors on providing the operational defintions of terms used in thge study, and provides a well researchjed model for the topic under study. The study starts from simple levels of study band continues to provide aspects that can be advanced in future studies. This reaserch is not meants to give out finds that are conclusive but help understand the topic under study ind depth (Yousaf, 2018). The study explanatory research as it also explains relationship among variables through hypothesis testing.
3.2 Population and sampling
Banerjee & chaudhury (2010) postulate that a research is best conducted on sample of persons instead of a whole population. Therefore, a population is that set group of persons or things from where a researcher needs to get the required elements to be used as research data. This population is identified through surveys. The element of research in survey is usually called as the respondent. The population and sample of this study are described below.
3.2 0 Population
This studies target population is online consumers. Sekaran and boogie (2010:262) define population a group of people, things of interest or events a researcher wishes to research on. This population is said to have similar characteristics and from which a sample is picked. Population consists of a comprehensive number of individuals, units or items that can become objects for observation (wiid and diggines, 2009:195).
3.2.1 Sample
A sample, is a subset of a population or subgroup of the obejscts of population selected to be used in a particular research (malhotra, 2010:371). It is usually drawn from the identified population elements that often can be said to differs from the identified and targetend population (zikmund and babin, 2007:407).
Researchers consider various things before settling on a apopulation sample size. Determining the sample size’s level of precision, its confidence level or the the analysis method and others. In this research, the number of population is unknown and these cases the minimum sample size is always 5 times the number of measurement item in the questionnaire. If it refers to the consideration of data analysis methods, where this research uses multivariate analysis then it is recommended to have a minimum sample size of 100 (kline, 2004 in edlynn, 2007:64).
Based on the explanation, if there are 29 measurement items are used and the sample size must be 5 times the number of measurement item thus, 145 respondents would be appropriate for this study.
3.2.2 Sampling Technique
There different methods through which sampling can be done. Actually, Malhotra (2007:376) classifies sampling technique into two non-probability sampling and probability sampling. Probability sampling is one in which, from large populations are chosen in arandom manner. The main idea here is that every member in a population stands a chance to be selected. So selection is on probability basis. This method of sampling is likely to give the best results out of a population. On the other hand, in nonprobability sampling, specific elements from the target population are usually selected in a nonrandom manner (mcdaniel and gates, 2010:423). Sekaran and bougie (2013:254) argue that probability sampling includes simple random sampling, stratified sampling, , area sampling, systematic sampling, , cluster sampling and double sampling. In nonprobability sampling there is judgement sampling, convenience sampling, and quota sampling.
If the population is unknown, the researcher then uses non probability. For this study, convenience sampling is used since it is termed best sampling procedure as in it the researcher has the freedom any online consumer encountered, all those persons who have tried to purchase goods online. According to malhotra (2010:377), convenience sampling is defined as nonprobability sampling technique which involves have in the sample drawn from the part of population that the researcher can access. As well convenience sampling is appropriate as online consumers are distributed across the globe and so it is only sensible for researcher to sample out those online consumers they can easily access. It is the researcher here who primarily carries out the sample selection process.
3.3 Instrument Development
Data is the center of any reach and very integral part in research process (sekaran and bougie, 2013:116). In order to obtain both quantitative and qualitative data this research uses the major two types of data collection procedures; the primary and secondary data methods which use the following techniques:
3.3.0 Primary data
Primary data in this research is collected by use of questionnaire which sekaran and bougie (2013:147), define as a pre-formulated written set of questions to which respondents record their answer, usually within rather closely defined alternatives. Use of questionnairee is very effective and efficient method of data collection method especially when the study is explanatory, and descriptive in nature. In order to collect the primary data of this research, a researcher uses a structured questionnaire that will be send in soft copy to far away respondents. The researcher distributes both printed-questionnaire and soft copies of questionnaire using google form to 200 respondents.
3.3.1 Secondary data
Sekaran and bougie (2013:116) posit that the benefits of secondary data source is it saving of time time and cost of collecting data from sources. As well thhjis methpod is econiomical in both cost and time and helps authenticate primary data. Through secoindary data a research is able tpo identify gaps in subject under study and help identifiy ares where reaserch has to bdone. For this research, the secondary data used is collected from various sources including relevant websites, books, articles and even journals.
3.3.2 Measurement of Dependent and Independent variables
Operation definition of variable is associated with effort employed in defining a concept in order to make it measureable (sekaran, 2006:4). According to sekaran (2003:176), the concept is usually translated into observable and measurable elements in order to develop an index of measurement of the concept.
The topic under study her is factors in digital marketing that influence purchase intention. Under factors thus varied and extant literature on the topics was reviewed with an intent of finding gaps in study or finding informative content among researcher’s content. Finally, data on the 6 variable, formulated by the researcher, under study was found. The items used to measure the variables in this study are adopted from the previous researches. The 6 variables and the items used in measurement of this variables are discussed below’
3.3.2.0 Independent variables
Purchase Intention
This is the dependent variable in this study. it is depended on e-Wom, perceived risk, quality and brand image as presented in the research. as we have in depth analyzed how internet is useful, in this part we define purchase intention and examine how it can be measured. Lu, et al (2014) it the willingness and desire to purchase a particular product by consumers., many scholars have done out researches and found that having a desire to purchase eventually results to developing purchase behaviour. Actually, purchase intention is a wide world used tool that estimates the effectiveness of strategies of marketing which are mostly helpful when sellers are predicting sales and market share. As well the same purchase intention helps consumers to forecast future behaviour of consumers and come up with best marketing strategies that influence consumers. It is every essential for marketers to make decisions regarding new and future products.
Table 3.2
Measurement items of purchase intention
| Variable | Item | Code | Source |
| Purchse intention | Tracking of consumers actions after purchase. | Pi1 | Kimble (2018) |
| Analysis of social conversations; in terms of number and quality. | Pi2 | Kimble (2018) | |
| Following on google trends | Pi3 | Kimble (2018) | |
| Interacting with internet requires a little of mental effort. | Pi4 | Kimble (2018) | |
| Overall, i find e-commerce is easy to use. | Pi5 | Kimble (2018)) |
3.3.2.1 Mediator Variable
Brand Quality
Aake, (1991) states that perceived quality is a vital aspect of brand equity. According to Zethaml (1988) perceived quality is not necessarily the real quality of a product or service but rather how the consumers feel and evaluate a product; ‘consumers subjective evaluation of the product’. It is therefore a necessity for one to understand the importance of perceived quality in order to survive in a competitive environment.
table 3.7
Measurement items of brand quality
| Variable | Item | Code | Source |
| Brand Quality | Customers present intent buy a product due to products perceived qualityto use internet in my daily actrivities. | Bq1 | Aake, (1991) |
| Brand quality was informed from e-Wom. | Bq2 | Aake, (1991) | |
| Customers knew of bread quality from brand image. | Bq3 | Aake, (1991) | |
| Price also helped customers form an idea of the quality of a particular product. | Bq4 | Aake, (1991) | |
| Brand quality can thus be said to be a mediator that links all the other variables to purchase intention | Bq5 | Zethaml (1988 |
Brand Image
This is defined by Hoffman et al (1999) as the general impression that a product holds as perceived by potential or even real customers. It is usually the perception that brand has in the mind of customers and can be summarizes as the ideas, aggregate beliefs, or the general impression that a customer holds towards a particular brand. Since the perception of an image is relative then it is not easy for a business to form that consistent brand that appeals to all customers.
Measurement items of brand image
| Variable | Item | Code | Source |
| Brand Quality | Customers present intent buy a product due to products brand image and so sellers should choose good brand images in order to attract customers. | Bi1 | Hoffman et al (1999) |
| Brand image was informed from material used in making a product | Bi2 | Hoffman et al (1999) | |
| Customers knew of bread image from viewing during online window shopping. | Bi3 | Hoffman et al (1999) | |
| Brand image also helped customers form an idea of the quality of a particular product. | Bi4 | Hoffman et al (1999) | |
| Brand image can thus be said to be a great contributor in the creation of purchase intention in consumers | Bi5 | Hoffman et al (1999) |
3.3.2.2 Dependent variables
E-wom
According to (nguyen and romaniuk, 2014z e-Wom is electronic word of mouth. The duo argues that this techonomic has made business very easy to carry out as word of mouth moves from a person to another very fast, especially when a message or communication item in social media goes viral. They further urge that is easy to measure word of mouth especially in websites as one only needs to pay key considerations to reviews and comments posted by satisfied or dissatisfied consumers,
Table 3.4
Measurement items of E-Wom effects
| Variable | Item | Code | Source |
| E-Wom | It encourages when we get recommendations from other customers | Ew1 | (Nguyen and Romaniuk, 2014z |
| Customers experience good relationship with other clients from online association when in interrnet | Ew2 | (Nguyen and Romaniuk, 2014z | |
| Customers are happy with online reviews on online sellers | Ew3 | (Nguyen and Romaniuk, 2014z | |
| Customers are satisfied with reviews from prior product users | Ew4 | (Nguyen and Romaniuk, 2014z |
Perceived Risk
`This is said to be the uncertainty that a consumer has when buying a particular product especially the expensive products. It involves all the doubts that consumers have before fully developing an intent to purchase a particular product. Lake (2019) posits that perceived risks can be due to the functionality of a product, the social standing of customers, financial status, the physical or even can be affected by time the product or a prior purchased product served a customer.
Measurement items of brand quality
| Variable | Item | Code | Source |
| Perceived risk | Customers present intent buy a product due to products perceived risk as collected from prior use of product | pr1 | Lake, (2019) |
| Brand perceived risk was informed from warrants and prior use. | Pr2 | Lake, (2019) | |
| Customers knew of brand risk before purchase. | Pr3 | Lake, (2019) | |
| Perceived risk helps customers form an idea of the risk they expect to face in case they purchase a product. | Pr4 | Lake, (2019) | |
| Perceived risk can thus be said to be a very crucial factor in determining purchase intention | Pr5 | Lake, (2019) |
Price
This is usually the money that every customer should pay for a product or service. Sinha avers that price can go by various names depending on what intention the payment is meant for. various customers use multidimensional pricing schemes this scholar notes that customers were greatly influence by the price tags on products. Those that deserved particular prices according to customer’s perception are highly purchase. A. Price as well speaks to the quality of a product.
Measurement items of products price
| Variable | Item | Code | Source |
| Price | Customers present intent to buy a product due to products price as indicated in price tags | p1 | (Nirushan, (2017) |
| Price of products indicates the quality of such product. | P2 | Nirushan, (2017) | |
| Customers would prefer to purchase even products at high price due to high quality. | P3 | Nirushan, (2017) | |
| Price is one of the determinants of trhe effective marketing of a product | P4 | (Nirushan, (2017) | |
| Price is thus very crucial factor in determining purchase intention | P5 | (Nirushan, (2017) |
3.4 Measurement scale
In this study, the researchers distributed an online structured questionnaire as a tool for collecting information from the respondents. The questionnaire consisted of 2 section of question and statement in which the first section is measuring the respondent’s demographic information using nominal scale such as 1 is male and 2 is female, while section 2 is measuring their agreement or disagreement towards several statement using interval scale.
Likert scale is used in this research as the measurement scale. Likert scale is scale designed to examine how strong respondents agree with a statement on a five-point scale range from strongly disagree to strongly agree (sekaran and bougie, 2013:211).
Table 3.7
Measurement scale
| Answer choice | Score |
| Strongly angree | 5 |
| Agree | 4 |
| Neither agree nor disagree (neutral) | 3 |
| Disagree | 2 |
| Strongly disagree | 1 |
Source: sekaran and bougie (2013:220)
The respondent were asked to fill the soft copy demographic question at the section 1 that applied to their actual personal information. At section 2, they were asked to respond to the several statements using 5-likert scale ranging from 1 that indicates strongly disagree to 5 which indicates strongly agree.
3.5 Data analysis Methods
Data analysis based on sekaran (2013) is a separating or breaking up of any whole on to its part especially with an examination of this part to find out their nature, proportion, function interrelationship, etc.
Descriptive statistics
Descriptive statistics are useful for describing the variables in this study by providing a general description of each sample character used. Descriptive statistics in this study provide an overview of the characteristics of respondents such as gender, age, education, occupation, and also the length of time using e-commerce or shopping online on daily basis. Descriptive statistics is also used to explain respondents’ answers to the research variables including: purchase intention, perceived risk, brand image, brand quality and products price effect on purchase intention. In this study using tabular presentation so that it is easy to understand and interpret, descriptive statistics presented in the table include frequency, percentage, and average answers.
3.5.0 Partial least square
This research uses structural equation model with partial lest square (pls) approach to proceed the data. Partial least square (pls) is method data dimension reduction similar of principal components to find the most relevant factors both prediction and interpretation. In addition, PLS handles all types of data and could help in assumptions about the characteristics of data (Hair et al., 2010). However many researcher used PLS method to find a data set that meets their requirements. The reason the researcher using PLS method is this technique is suitable for analyzing data from non-normal distribution. Another reason of using pls is based on wong (2010) as wong stated that, pls becomes a good alternative when the following situations are encountered: (1) sample size is small; (2) applications have little available theory; (3) predictive accuracy is paramount; (4) correct model specification cannot be ensured and (5) definition of normal distribution is free. This research was processed using smartpls version 3.2.7 as the software.
3.5.1 Outer model (measurement model) evaluation
The measurement model or outer model relates observed manifest variables (mvs) to their latent variables (lvs). Often observed variables are referred to manifest variables or indicators, while latent variables are as factors. This research uses reflective measures; and these measures are caused by the latent construct. In outer model evaluation, the data are analyzed based on its validity test and reliability test. The validity test consists of convergent validity and discriminant validity; meanwhile reliability test is measured based on its internal consistency reliability.
3.5.2Validity test
Validity has been defined to measures what it claims to measures (gregory, 1992). Its measures what it is supposed to measure without accidently including other factors. In this research, the validity questionnaire is used as a data collection tool. In testing the validity of the research instruments, it uses convergent validity (loading factor and ave) and discriminant validity (cross loading).
Convergent validity can be assessed based on the correlation between component / indicator values and construct values. Individual reflexive measures are said to be high if the correlation of indicators with their constructs is more than 0.70 (hair, et.al, 2016). But in the initial stages of the study, loading values of 0.50 to 0.60 can be considered sufficient (chin, 1998).
Discriminant validity of reflexive indicators can be seen in crossloading between indicators and their constructs. If the correlation of constructs with measurement items (indicators) is greater than other constructs, then it can be said that the latent construct predicts the size of the block better than the size of the other blocks (hair, et.al, 2016). Another method for assessing discriminant validity is by comparing the square root of average variance extracted (ave) for each construct and the correlation between constructs and other constructs in the model. If the square root ave of each construct is greater than the correlation value between constructs and other constructs, then the discriminant validity value is good (fornell and larcker, 1981). The measurement of discriminant validity by looking at the ave value can be used to measure the reliability of the latent variable component values and the results are more conservative than composite reliability. The recommended ave value is greater than 0.50.
3.5.3 Reliability test
The reliability is defined as consistency measurement across time and various items. It is a measure of stability and consistency with which instruments measures the concept (sekaran, 2003). In this research, the reliability test uses internal consistency reliability based on the value of composite reliability. If the value of composite reliability is 0.7 or higher, so the latent variable (construct) can be categorized as reliable (wong, 2013).
3.5.4 Inner model (strcutural model) evaluation
Inner models shows the relationship between latent variables based on substantive theory. Latent variable are divided into two classes, exogenous and endogenous. In measuring inner model, it uses adjusted r-square for dependent construct, godness-of-fit, and also hypothesis testing by looking at significance of the path coefficients of structural parameters.
3.5.5 Adjusted r-squares
The adjusted r-square is used to assess the role of exogenous variables on endogenous variables in this study. The use of the adjusted r-square coefficient is suggested by cohen, et.al (2003: 84) to avoid bias the number of predictors included in the model. According to hair,et.al (2016) the adjusted r-squared value > 0.25 (25%) indicates that the model has goodness of fit or the relationship between variables in the study is said to be quite close.
3.6 Pilot Study
Testing the proposed hypothesis also called pilot study can be seen from the magnitude of the t-statistic value and p-value of the path coefficient. The significance of the estimated parameters provides very useful information about the relationships between the research variables. The criteria for rejecting and accepting the proposed hypothesis can be seen from the comparison between the t-calculated and t-table values or comparing the p-value with the level of significance that is used. If the t-statistic value> t-table is at the 5% significance level, which is 1.96 (two-tailed) or p-value with a significance level (5%), then the research hypothesis is accepted.
3.7 Summary
This chapter has presented the methodology used in study. It has presented the different types of data used in this study and how information was collected from all sources. As well the measurements of variables that provide further understanding of data collected from the field.
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