AMERICAN UNIVERSITY IN BOSNIA AND

HERZEGOVINA

AMERICAN SCHOOL OF ECONOMICS

BILJANA LUKIĆ

MASTER THESIS

CONSUMERS BEHAVIOUR TOWARDS ONLINE SHOPPING OF

ELECTRONICS IN BOSNIA AND HERZEGOVINA

MAGISTARSKA TEZA

PONAŠANJE KUPACA PRILIKOM ONLINE KUPOVINE ELEKTRONIČKE

ROBE U BOSNI I HERCEGOVINI

MAY, 2014

AMERICAN UNIVERSITY IN BOSNIA AND

HERZEGOVINA

AMERICAN SCHOOL OF ECONOMICS

BILJANA LUKIĆ

MASTER THESIS

CONSUMERS BEHAVIOUR TOWARDS ONLINE SHOPPING OF ELECTRONICS IN

BOSNIA AND HERZEGOVINA

MAGISTARSKA TEZA

PONAŠANJE KUPACA PRILIKOM ONLINE KUPOVINE ELEKTRONIČKE ROBE U

BOSNI I HERCEGOVINI

MAY, 2014

AUBIH Mentor………………………………………………………………...Enis Džanić, PhD

Master Thesis Project has……………………………………………………………… 51 pages

Master Thesis Project Number………………………………………………………__________

ii

Acknowledgement

I would like to express my gratitude to my mentor Professor Dr. Enis Džanić for the

useful comments, remarks and engagement through the learning process of this master thesis.

Furthermore I like to thank the participants in my survey, who have willingly shared their

precious time during the survey. Also, I would like to thank my loved ones, who have supported

me throughout entire process.

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List of Figures

Figure 1 Gender ............................................................................................................................ 14 Figure 2 Age ................................................................................................................................. 15 Figure 3 Education ........................................................................................................................ 15 Figure 4 Income ............................................................................................................................ 16

Figure 5 Duration of online shopping ........................................................................................... 16 Figure 6 Price advantage ............................................................................................................... 17 Figure 7 Free delivery charge is a price advantage when I shop online ....................................... 18 Figure 8 Product price is important to me when I shop online ..................................................... 18 Figure 9 I am willing to pay higher price for product that is not available in ordinary shops .... 19

Figure 10 Free gift is a price advantage when I shop online ........................................................ 19 Figure 11 I will not purchase the product when the price is not acceptable to me when I shop

online............................................................................................................................................. 20 Figure 12 I shop online as I do not have to leave home for shopping .......................................... 20 Figure 13 I shop online as I can shop whenever I want ................................................................ 21 Figure 14 I shop online as I can get detailed product information online .................................... 21 Figure 15 I shop online as I get broader selection of products online .......................................... 22

Figure 16 Online shopping gives facility of easy price comparison ............................................. 22 Figure 17 I shop online as I get user/expert reviews on the product ............................................ 23 Figure 18 I shop online as I can take as much time as I want to decide ....................................... 23 Figure 19 I use online shopping for buying products which are otherwise not easily available in

the nearby market .......................................................................................................................... 24 Figure 20 Online shopping makes my shopping easy .................................................................. 24 Figure 21 Online shopping procedure is cumbersome and frustrating ......................................... 25

Figure 22 I feel that my credit-card details may be compromised and misused if I shop online . 25 Figure 23 I feel that my personal information given for transaction to the retailer may be

compromised to 3rd

party .............................................................................................................. 26

Figure 24 I might not get what I ordered through online shopping .............................................. 26

Figure 25 It is hard to judge the quality of merchandise over Internet ......................................... 27 Figure 26 Finding right product online is difficult ....................................................................... 27 Figure 27 If I shop online I cannot wait till the product arrives ................................................... 28

Figure 28 I cannot get to examine the product when I shop online .............................................. 28 Figure 29 I might not receive the product ordered online ............................................................ 29

Figure 30 I purchase online only when I can return the product without any frills or strings

attached ......................................................................................................................................... 29 Figure 31 I do not purchase online if there is no money back guarantee ..................................... 30 Figure 32 Using Internet for online shopping is easy ................................................................... 30 Figure 33 Shopping online is fun and I enjoy it............................................................................ 31 Figure 34 I will have no problem in shopping online if I get to know that my friends and relatives

are doing it without any problems ................................................................................................ 31

Figure 35 What is the Internet the mostly used for ....................................................................... 32 Figure 36 How many times have you bought electronic goods over the Internet ....................... 32

Figure 37 How much do online buyers spend on online shopping of electronic goods per month

....................................................................................................................................................... 33 Figure 38 Crucial factors that affect online buyer’s decision making .......................................... 33 Figure 39 The way that online buyers find the sales channels ..................................................... 34 Figure 40 The main barriers which keep people away from shopping online .............................. 35

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Table of content

Acknowledgement .......................................................................................................................... ii

List of Figures ................................................................................................................................ iii

Abstract ........................................................................................................................................... 1

1. INTRODUCTION...................................................................................................................... 2

1.1. Consumer behaviour ............................................................................................................. 2

1.1.1. Online decision making process .................................................................................... 3

1.1.2. Problem Recognition ..................................................................................................... 4

1.1.3. Information collecting .................................................................................................... 4

1.1.4. Evaluations of alternatives ............................................................................................. 5

1.2. Factors influencing consumers’ behaviour toward online shopping .................................... 5

1.2.1. Subjective factors ........................................................................................................... 6

1.2.2. Objective factors ............................................................................................................ 7

1.3. Hypothesis development ..................................................................................................... 10

1.3.1. Individual demands and online consumers’ purchase behaviour ................................ 10

1.3.2. Consumers’ attitude and online consumers’ purchase behaviour ................................ 11

1.3.3. Price and consumers’ purchase behaviour ................................................................... 11

1.3.4. Quality.......................................................................................................................... 12

1.3.5. Web Trust and online consumers’ purchase behaviour ............................................... 12

1.3.6. Online consumers’ previous purchase decision and repeat purchase behaviour ......... 12

2. METHODOLOGY .................................................................................................................. 13

3. RESULTS ................................................................................................................................. 14

3.1. Discussion ........................................................................................................................... 35

3. CONCLUSION ........................................................................................................................ 38

Literature Review ........................................................................................................................ 40

References ..................................................................................................................................... 47

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Abstract

The main goal of this research is to examine customer behaviour toward online purchase

of electronic goods in Bosnia and Herzegovina. There have been many studies which have

investigated the arena of on-line shopping, but relatively few have focused on on-line shopping

behaviour in Bosnia and Herzegovina. The main research question in thesis is how consumers

behave while shopping electronics online and which factors influence their decision making.

Primary data will be collected through the self-administrated questionnaire that would be filled

out by respondents in Bosnia and Herzegovina.

Key words: online shopping, consumer behaviour, e-commerce, electronics, decision making

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1. INTRODUCTION

Traditionally, consumers have to go to ordinary stores to buy what they want; the

distinctive characteristic between online shopping and traditional shopping is that consumers

need not to go to a physical store, but make their choices base on what they see on the internet, so

it is useful to discover the factors that might affect online purchasing behaviour, either positively

or negatively. In the era of globalization electronic marketing is a great revolution. Over the last

decade maximum business organizations are running with technological change. Online shopping

or marketing is the use of technology (i.e., computer) for better marketing performance. And

retailers are devising strategies to meet the demand of online shoppers; they are busy in studying

consumer behaviour in the field of online shopping, to see the consumer attitudes towards online

shopping of electronic goods.

1.1. Consumer behaviour

“Consumer behaviour is the study of individuals, groups, or organizations and the

processes they use to select, secure, and dispose of products, services, experiences, or ideas to

satisfy needs and the impacts that these processes have on the consumer and society. “ (Kuester,

2012). Consumer decision making means a consumer make a choice between more than one

option of goods or services. The study of consumer decision making concerns how consumer

make decision between those alternatives (Peter and Olson, 1999). A large amount researches

about consumer decision making put the focus on the cognitive process. Consumers decision

making process was described as complicated with many factors generating problem recognition

before a series of actions was initiated to reach a result (Erasmus et al., 2001).

Consumer decision making process describes the steps of a consumer’s decision making.

Consumers first identify their needs and then collect information, evaluate the alternatives and

finally make the purchase decision. All these actions are determined by both psychological and

economic factors, and are affected by environmental factors like cultural, group, and social values

(Klein and Yadav, 1989).

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In the psychological aspect, consumers are viewed as irrational, impulsive and passive when

making decision (Zaichkowsky, 1991). Some psychologists presume consumers would use

rational shortcuts to make decisions. They think that consumers are not perfect decision makers

and their minds are limited to handle and recall the information.

For the economical perspectives, the Utility Theory anticipated that consumers make decisions

based on the expected outcomes of their decisions. In this model consumers were viewed as

rational actors who were able to estimate the probabilistic outcomes of uncertain decisions and

select the outcome which maximized their well-being (Fishburn, 1968).

1.1.1. Online decision making process

The process of online purchase behaviour consists of several steps and it is similar to

traditional shopping behaviour (Liang and Lai 2000). For instance, consumer recognize the need

for buying some product (book), they refers to the internet to buy online and start to search for

the information and look for all the alternatives and finally make a purchase which best meets

their needs. Before making final purchase consumers are bombarded by several factors which

limits or influence consumers’ final decision.

Goldsmith and Goldsmith (2002) found that experienced online shoppers have more trust and

better feeling regarding online service than non-experienced shoppers who had no online

shopping experience before. Also, after having considered the risks and having understood them,

the experienced online shopper are less risk reluctant than non-experienced shoppers (Donthu,

1999). Therefore, it is becoming more and more important for online sellers to gain online

consumers’ trust. Those studies have been used to explain consumers’ decision making, but there

was few research investigating the underlying factors affecting different consumers’ decision

making. Therefore a study that investigates such factors is needed to understand the justification

of consumers’ purchasing decision making.

Consumers’ online shopping behaviour is based on the manifestation of online sellers website,

the photos of products but not an actual real product (Lohse and Spiller 1998; Park and Kim

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2003). Due to the increasing amount of online sellers, the competition among sellers on the

internet will become more and more intense. In order to distinguish themselves, it is useful for

sellers to find out what factors affect a potential consumer’s online purchasing behaviour.

1.1.2. Problem Recognition

The intention of a consumer to solve a problem depends on the level of the discrepancy

between the desired and present situation and the relative importance of the problem. The

recognition of a problem may be caused by internal factors like the person’s financial situation

and also external factors for example advertisements. Internet marketing stimuli can be used in

triggering consumers’ needs. Thus, online sellers can capture potential consumers at this stage by

predicting consumers’ needs and problems (Bulter and Peppard, 1998).

The review of empirical studies has embodied different factors which influence online

purchasers’ behaviour. The antecedents of online purchase include many attitudinal components;

for example, attitude towards online shopping and perceived risk of an online purchase.

Consumers’ online shopping experiences, website and fulfillment of quality expectations are

deemed as the major components to successful online transactions. In essence, our interest is in

discovering the factors affecting consumers’ intent to buy online as well as in quantifying their

relative importance. Specifically, through surveying consumers based on the literature, we are

interested in identifying and rank-ordering factors affecting intent to buy online in Bosnia and

Herzegovina.

1.1.3. Information collecting

After a consumer recognizes a problem or a need, he/she will start collect information to

solve the problem (Jobber, 1998). It is critical for online sellers to know and understand the

online decision making process and focus on how to attract consumers that are searching for

information and provide what they want. Previous findings stated that internet usage has

positive effects on consumers’ online shopping attitude and intention to shop online (Dennis, et

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al. 2002). Potential online customers will use the internet as a platform to collect information

and they tend to have positive attitudes on online shopping. Previous studies also supported that

a consumers innovativeness will affect his/her intention on shopping online directly (Citrin et al.

2000). Therefore, in this stage, the information collecting stage, consumers’ innovativeness and

their internet usage are positively influencing consumers’ attitude on online shopping.

1.1.4. Evaluations of alternatives

After collecting information, consumers will evaluate between different alternatives in

order to make a decision of purchase. In traditional decision making process, consumers

evaluate the alternatives by evaluating the performance of the product or service by considering

the cost of purchase and concerns the effects of the purchase on social norms and relationship

with other people and how the products are related to individual (Jobber, 1998). When

consumers are evaluating the alternatives during online shopping, privacy is an important factor,

the security of the transaction is important to affect consumers’ decision.

1.2. Factors influencing consumers’ behaviour toward online shopping

The main theme of the study is to know the factors that influence the consumer’s

attitudes and behaviours towards online shopping of electronics, especially in Bosnia and

Herzegovina. In the typical online shopping process, when potential consumers recognize a need

for some merchandise or service, they go to the Internet and search for need-related information.

However, rather than searching actively, at times potential consumers are attracted by

information about products or services associated with the felt need. Then, they evaluate

alternatives and choose the one that best fits their criteria for meeting the felt need. Finally, a

transaction is conducted and post-sales services provided. Online shopping attitude refers to

consumer’s psychological state in terms of making purchases on the Internet. Both subjective

factors and objective factors affect consumers’ purchasing behaviour towards apparel when

shopping online, and also affect the repeated purchasing behaviour of online consumers.

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1.2.1. Subjective factors

The subjective factors affecting consumers’ purchase behaviour mainly relate to the

consumers’ subjective consciousness, both positive and negative. Subjective factors are affected

by external environment or decided by individual demands which means that different

consumers will have different reactions. Consumers who are easily affected by the external

environment will have a considerable impact on cognition (Alexandre and Dennis, 2006).

Consumers’ personality will also affect their purchasing behaviour and decisions.

1.2.1.1. Individual demands

There were several demands for consumers to shop online. One of the demands is that

online shopping can save time for consumers (Hawkins, DI Hawkins, Best, Coney 2003). And in

Hong Kong, modern which appreciates time efficiency, saving time is important to people in all

aspects including shopping. Thus more and more people in Hong Kong choose online shopping

rather than traditional shopping. Besides, the time of online shopping is flexible which allows

consumers to carry out online shopping activities any time at any place (Harrell G.D. &

McConocha D.M. 2007). Almost all the online stores operate 24hours basis and this is more

convenient to consumers.

1.2.1.2. Consumers Attitude

Consumers who are willing to try new things have higher risk bearing ability than those

conservative ones. Since the online shopping risk is thought that higher than traditional shopping

in ordinary stores, almost all online consumers are willing to try new things (Martinsons M.G.

2008).

Consumers are able to shop online more and more efficiently due to the rapid development of

internet technology which provides a more and more advanced online shopping platform to

consumers. The technology acceptance model (TAM) (Childers et al. 2001; Koufaris 2002;

Gefen, Karahanna, and Straub 2003) stated two significant factors that affect an individual’s

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attitude and intention to use new technology, they are the ease of use and usefulness (Davis

1989). Lately, the enjoyment has been added to the TAM model (Heijden 2004). Both the

utilitarian and hedonic aspects are viewed as relevant to consumers’ acceptance of online

shopping in the TAM model (Childers et al. 2001), for example the enjoyment of online

shopping and the usefulness of online grocery shopping they refer to hedonic and utilitarian

aspect respectively. The study proposed two things. One is that utilitarian aspect of online

environment is crucial for online shopping attitudes and hedonic aspect is evenly significant.

Through the study on the behaviour of online bidders in online auctions, Angst and colleagues

(2008) found out that consumers’ decisions were influenced by hedonic fulfillment. Also, it was

found that online consumers were related to their need for excitement and uniqueness; positive

sociality; online deal searching and involvement with a product class. Their motivation to shop

online was associated with fun (Wolfinbarger and Gilly, 2001).

1.2.2. Objective factors

1.2.2.1. Price

Actual prices are the discounts or surcharges relative to price expectations, according to

prospect theory (Tversky & Kahneman, 1991); this perception affects the demands for a firm’s

product, and hence its profitability.

Consumers have a variety of prices in their memory against which they evaluate the current price

of a product. The upper price limit is the price above which the consumer considers the product

as expensive or belongs to a different sub-category, while the lower price limit is the price below

which the consumer considers the product to be of poor quality. The acceptable price range is the

difference between the two limits. In addition to price uncertainty, the width of the acceptable

price range is determined by the customer’s price consciousness (Widrick and Sorce 1991), price

knowledge (Kosenko and Rahtz, 1988), or purchase frequency (Urbany and Dickson

1991). The above studies suggested that occasional buyers (presumably with higher price

uncertainty) have a wider range of acceptable prices as well as a higher midpoint than regular

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buyers. The degree that consumers distinguish and react to price levels and price changes is price

sensitivity (Goldsmith et al, 2005). Price sensitivity can works as an indicator of how much a

consumer is willing to pay. Therefore the price has an important effect on consumers' purchase

behaviour and as a result on sales and profits of the business (Han et al, 2001).

1.2.2.2. Quality

Quality means providing pleasure to consumers, not just protecting them from annoyance

(Garvin 1987). Quality can also be regarded as one of the key components of a business’

competitive advantage. Thus, the quality of products or services is important to a business

(Foster and Sjoblom, 1996). There are five approaches to define quality: the transcendent

approach, the product-based approach, the user-based approach, the manufacturing-based

approach and value-based approach (Garvin 1984). The transcendent approach assumed quality

is both absolute and generally identifiable. The product-based approach states that the

differences in the quantity of ingredient or attribute of a product reflect in divergence in quality

of that product. The user-based approach states quality is the degree of how a product or service

meets or go beyond consumers’ expectations. The manufacturing-based approach defined quality

as conformance to requirement. That means how a product or service meets a certain design

standards. Finally the value-based approach considers quality with performance at acceptable

price or acceptable cost. Consumers that are interested shopping enjoyment are positively liable

toward hobby, quality and impulse orientations when making online purchase. Different form

traditional shopping at ordinary stores, inline shopping does not allow consumers to physically

judge the quality of the product. That means consumers can only rely on the pictures and

information on the online sellers’ website to judge the product quality. They also evaluate

product quality by reviewing sellers’ credibility, feedback, products quantity and variety (Lala

V., Arnold V., Sutton S. G., & Guan L, 2002).

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1.2.2.3. Web Trust towards online shopping environment

Buyers and sellers develop a degree of trust between each other. Sellers should trust their

customers in that they are able to choose goods and services, purchase them, and pay for them.

On the other hand, customers should trust sellers that they can provide their needed goods and

services and are able to distribute (or deliver) them if necessary (Zargar, 2001). To maintain the

business relationship and reach the goal between sellers and buyers, trust is a necessary factor.

When people trust each other, it means that they keep their promises they made during their

business relationship.

In the virtual market environment, buyers usually see pictures of their goods to be purchased,

not the goods themselves. Many promises about the quality of goods and services are made. In

the e-commerce environment, since it is very hard to take legal actions against sellers or

customers in case of any fraud or dispute, therefore, trust is highly important in conducting e-

business transactions. When the consumer is placing an order in the internet in which he or she

needs to provide financial information and other personal data, enough trust is needed to carry

out the transactions to carry on (Eggert, 2006).

Therefore, trust can be regarded as the foundation of trade and it is crucial in many economic

exchanges, especially in the online environment (Gefen, Rose, Warkentin & Pavlou, 2005;

Hoffman, Novak & Peralta, 1999). The success of e-commerce needs consumers to trust the

virtual environment.

Yoon (2002) recognized four factors as the components of web trust. They include transaction

security, website property, navigation functionality, and personal variables. Online trust showed

very similar responses to its antecedents as web-site satisfaction except for site properties which

was significant to web-site trust only and for navigation functionality which was significant for

web-site satisfaction only. This means that is more important to increase consumers’ trust

towards an online seller than emphasize the general image of the web site is more important

than emphasizing the functionality of the site. Also, refund policy and risk freeness of online

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transaction affect consumers trust as well. Trust can also be gained through positive experience

between online buyers and sellers. This study showed that web trust can affect online-purchase

decision (Yoon, 2002).

1.3. Hypothesis development

This research is going to focus on the consumer behaviour towards online buying of

electronics. According to the report for 2012 by Agency of Statistic of Bosnia and Herzegovina

there were 2.189.940 Internet users in Bosnia and Herzegovina, with 57% Internet penetration.

The aim of this research is to explore factors affecting consumer decision whether to buy

electronic goods online or not. The main hypotheses in this research are:

H0: There is a relationship between factors affecting consumer behaviour and online shopping

H1: Individual Demands have positive influence on online consumer purchase decision

and behaviour.

H2: Consumers attitude has influence on online consumer purchase decision and behaviour.

H3: Reasonable price strategy has positive influence on online consumer purchase decision and

behaviour

H4: Product quality has positive influence on online consumer purchase decision and behaviour.

H5: Web trust has positive influence on online consumer purchase decision and behaviour.

H6: Online consumer purchase decision and behaviour has positive influence on repeated

purchase bahaviour.

1.3.1. Individual demands and online consumers’ purchase behaviour

The platform of e-commerce provides consumers a chance to meet their shopping

demands by sitting in front of the computer and shop at home. And this also satisfies shopping

demands of those consumers who prefer to stay at home rather than visiting ordinary stores. For

those who are price conscious, online shopping reduces the price indirectly by saving the

transportation cost (Wonseok Oh, 2002). Besides, online shopping is an alternative for

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consumers to purchase sensitive goods that may cause inconvenience when purchasing in

ordinary store (Cameron & Galloway, 2005).

Since there are no limitations regarding opening hours of online stores, online shopping can

satisfy consumers’ impulses on shopping. And this also satisfies the demands of consumers who

have no time to shop at physical stores, in which their leisure time after work or school do not

match the opening hours of physical stores (Chu & Liu, 2007).

When facing the difficulties of gaining product information, consumers tend to choose online

shopping to solve them. For instance, consumers may find difficulties to know which physical

store in their city have the product they want and sometimes even there is no physical store in

their city selling what they want (Chu & Liu, 2007). And therefore the hypothesis H1 was drawn:

H1: Individual Demands have positive influence on online consumer purchase decision

and behaviour.

1.3.2. Consumers’ attitude and online consumers’ purchase behaviour

Consumers’ decisions were influenced by hedonic need fulfillment (Angst, 2008). Their

happiness relates to the shopping process itself rather than the result and means that outgoing

person tend to shop at ordinary stores and enjoy shopping. Therefore a shy person who is not

good at communicating with other people may tend to shop online as he/she can avoid in person

interaction with others. As it is not necessary for consumers to interact with others face to face,

this may attract introverts to shop online. And therefore the hypothesis H2 was drawn:

H2: Consumers attitude has influence on online consumer purchase decision and behaviour.

1.3.3. Price and consumers’ purchase behaviour

Many consumers use online auctions to search for rare and unusual product, like those

products that are limited edition. Also they use online auctions to find quality goods with

moderate price rather than just to find low priced products. Besides, auction participants have a

feeling of attachment to auction items when bidding duration gets long. At the early stage of

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shopping online, consumer may be price sensitive, but an excited and competitive shopping

journey may increase consumers’ willingness to pay more for an attractive and better fashion

product and their price sensitivity for the final price will be decreased (Irani & Hanzaee, 2011).

And therefore the hypothesis H3 was drawn:

H3: Reasonable price strategy has positive influence on online consumer purchase decision and

behaviour.

1.3.4. Quality

Online consumers are not able to evaluate the product quality directly; they can only rely

on the photographs and descriptions provided by the online seller in the website to judge the

product quality. Also, consumers can evaluate product quality by reviewing sellers’ credibility,

feedback from other buyers, products quantity and variety. The product assurance proposed by

the online sellers also reflects the quality of the products (Lala V., Arnold V., Sutton S. G., &

Guan L, 2002). Thus, the hypothesis H4 was drawn:

H4: Product quality has positive influence on online consumer purchase decision and behaviour.

1.3.5. Web Trust and online consumers’ purchase behaviour

The purchase behaviour of consumers in the online environment is totally different from

making decision in a physical environment (Alba et al 1997). When the online shops’ website

has a proper layout, this will encourage consumers to make purchase. Besides, refund policy and

other after sales services of online transaction can affect consumers trust as well. Consumers’

trust will gain through positive experience between online buyers and sellers (Yoon, 2002).

Thus, the hypothesis H5 was drawn:

H5: Web trust has positive influence on online consumer purchase decision and behaviour.

1.3.6. Online consumers’ previous purchase decision and repeat purchase behaviour

A satisfied online shopping experience that stimulates memory resident positive imagery

of the online store or business can affect a consumer’s web trust and satisfaction (Yoon, 2002).

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That means the previous experience of an online consumers can influence his or her repeated

purchase behaviour, both positively and negatively. To increase consumers’ loyalty and increase

their repeat purchase behaviour, online sellers should develop a relationship with online buyers

during their first purchase. Therefore the hypothesis H6 was drawn:

H6: Online consumer purchase decision and behaviour has positive influence on repeat

purchase bahaviour.

2. METHODOLOGY

A self-administrated questionnaire filled up by respondents in Bosnia and Herzegovina

will be used for this research. The questionnaire will be sent out by e-mail to friend and

followers. The survey will consist of demographics questions, such as age, gender, education,

registration and activity, and perception questions that will be focused on users’ purchasing

behaviour. The sample of this study consists of internet users who know how to make an online

purchase, possibly have made one or are willing to make one in the future. Respondents will be

not limited with age constraint.

In the questionnaire, the Likert scale will be used with five categories, in which, 1 stands for

Strongly Disagree; 2 stands for Disagree; 3 stands for Neutral; 4 stands for Agree and 5 stands

for Strongly Agree. The frequency of online buying would be measured by asking how many

times the respondent had made purchases on the web in the most recent year. In order to create

these categories, consumers who purchased online once yearly, 2-4 times yearly, 5-10 times

yearly and more than 10 times yearly were categorized as trial, occasional, frequent and regular

online purchasers, respectively. This will enable the researcher to gather enough data to conduct

qualitative, quantitative but also to analyze consumer behaviour in online buying. After

conducting analysis on gathered data, results of the research will be represented in a simple way

through tables and diagrams and explanations of those findings. The researcher will draw a

conclusion which will prove or disprove the hypothesis, depending on results which will prove

or disprove derived hypotheses.

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3. RESULTS

In this chapter the results from the questionnaire and the distribution of collected data

among the respondents have been discussed and presented. The questionnaire was designed to

collect the primary data and further on to analyze the data and how consumers behave against the

importance of price, convenience, risk, shopping habits and some factors that are likely to

influence their online shopping intention. The questionnaire was first divided to the

demographics segmentation among the respondents and second to collecting the data about the

factors like price; convenience; perceived risks, shopping habits and shipping; factors that are

likely to influence shopping intention and online behavior of the respondents which effect

directly or indirectly to the decision making process and ultimately highlight the typical

behaviour of consumer while shopping online. 120 electronic questionnaires were sent by e-mail.

Finally, 102 questionnaires were usable for analyzing and following responses have been

received;

Gender: According to demographic profile, 54.22% respondents are male and 45.78%

respondents are female. At the time of survey comparatively higher number of female said that

they didn’t have online shopping experience. Therefore, according to the survey result it is clear

that male respondents are more interested in online shopping than female.

Figure 1 Gender

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Age: The figure below shows that 31.33% respondents are between 18-29 years old and 68.67%

are between 30-49 years old. We can see from these results that there were no respondents over

50 years old who purchase online. 36.84% of female respondents are between 19 and 29 years

old, and 36.16% between 30 and 49 years old. 26.67% of male respondents are between 18 and

29 years old, and 73.33% between 30 and 49 years old.

Figure 2 Age

Education: 83 people took part in the survey, among whom 28.92% respondents have bachelor

diploma, 27.71% have high school diploma, 26.51% have college diploma, and 16.87% have

postgraduate diploma. Respondents are quite highly educated with 72.30% having at least

college education.

Figure 3 Education

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Income: We can see from the results that 14.63% of respondents have monthly income less than

700BAM, 21.98% of respondents have monthly income between 701 and 1000BAM, 35.37%

have monthly income between 1001-1500BAM, 17.07% of respondents have monthly income

between 1501-3000BAM, and 10.98% of them have monthly income more than 3000BAM. The

figure below shows that monthly incomes from 1001-1500BAM with 35.37% have the highest

percentage among other income distribution.

Figure 4 Income

Next figure shows for how long people in Bosnia and Herzegovina use Internet for shopping.

Figure 5 Duration of online shopping

As we can see from the Figure 5, 29.31% of total number of respondents does not use Internet

for shopping, 27.59% of respondents have been using Internet for shopping for 3 years, 25.00%

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of respondents have been buying online for 1-3 years, and 8.62% of respondents have been

buying online for 6-12 months.

Next few questions refer to price factor.

Figure 6 Price advantage

As illustrated by the Figure 6, 15.38% strongly agreed that lower price of the same product at

solid shops is an advantage when they shop online, 60.23% agree with that as well, 16.67% were

indecisive, 6.41% disagree, and 1.28% strongly disagree. Since the majority of the respondents

with 75.64% agree that lower price of products have positive impact on their buying decision, we

can say that the Hypothesis 3: Reasonable price strategy has positive influence on online

consumer purchase decision and behaviour, is supported.

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Figure 7 Free delivery charge is a price advantage when I shop online

As we can see from the figure above, 58.44% of respondents agree, and 35.06% strongly agree

that the free delivery charge is a price advantage when they shop online. Very low percentage,

6.49% disagree with that.

Figure 8 Product price is important to me when I shop online

Consumer cost is an important reason for online buying. As illustrated by Figure 8, for a greatest

number of online buyers in Bosnia and Herzegovina good product price is very important when

they shop online. 48.72% of respondents agree that the product price is important to them,

38.46% strongly agree with that. Only 10.26% disagree and 2.56% strongly disagree that the

product price is important to them.

19

Figure 9 I am willing to pay higher price for product that is not available in ordinary

shops

As illustrated by Figure 9, greatest part of online purchases in B&H arises from the lack of

products at domestic market. Majority of respondents, 47.44% agree and 15.38% strongly agree

that they are willing to pay a higher price for products that are not available in solid shops.

21.79% of respondents are indecisive and 15.38% are not willing to pay a higher price for

products that are not available in solid shops.

Figure 10 Free gift is a price advantage when I shop online

Many online stores offer discount coupons, rebates and free gifts. Figure 10 shows that for

50.65% of respondents free gift is price advantage, 22.08% disagree with that and 27.27% of

respondents are indecisive.

20

Figure 11 I will not purchase the product when the price is not acceptable to me when I

shop online

From Figure 11 it is obvious that majority of respondents, i.e. 56.41% of them agree and 32.05%

that strongly agree not to purchase the product online when the price is not acceptable to them

when they shop online. Only 7.69% of respondents disagree that they would purchase the

product even though price is not acceptable for them and 3.85% of respondents are indecisive

about this question.

Next few questions refer to convenience of online shopping.

Figure 12 I shop online as I do not have to leave home for shopping

Figure 12 shows that the greatest number of respondents or 49.35% disagree and 6.49% strongly

disagree that they shop online as they do not have to leave home for shopping; 12.99% were

21

indecisive, 28.57% agree and 2.60% strongly agree that they shop online as they do not have to

leave home.

Figure 13 I shop online as I can shop whenever I want

Online shops give people the opportunity to shop 24/7. The figure above shows that 58.98% of

respondents shop online as they can shop whenever they want. Only 17.95% of respondents

disagree with that and 23.08% are indecisive.

Figure 14 I shop online as I can get detailed product information online

As illustrated in Figure 14 majority of respondents or 63.16% shop online as they can get

detailed product information online. Only 19.74% of respondents disagree with that, and 17.11%

are indecisive.

22

Figure 15 I shop online as I get broader selection of products online

Figure 15 shows that 75.64% of respondents shop online because they get broader selection of

products online. Only 8.97% disagree with that, and 15.38% are indecisive.

Figure 16 Online shopping gives facility of easy price comparison

Online shops make comparison and research of products and possible prices, and online buyers

don’t have to go to other stores to compare prices. Online stores also give you the ability to share

information and reviews with other shoppers who have firsthand experience with a product or

retailer. The Figure 16 above shows, 66.67% of respondents agree and 11.54% strongly agree

that online shopping gives facility of easy price comparison as a price advantage. Also, with this

way of price comparison, online buyers save time and money. 17.95% of respondents are

indecisive about that, and only 3.85% disagree with this.

23

Figure 17 I shop online as I get user/expert reviews on the product

People can easily check the prices at a variety of stores with just a few mouse clicks. That is why

67.53% of respondents agree that shop online as they get user/expert reviews on the product they

are interested in. 18.18% of respondents disagree with that and 14.29% are indecisive.

Figure 18 I shop online as I can take as much time as I want to decide

As Figure 18 shows 51.32% of respondents agree and 23.68% strongly agree that they shop

online as they can take as much time as they want to make a decision. 9.21% disagree with that,

and 15.79% are indecisive.

24

Figure 19 I use online shopping for buying products which are otherwise not easily

available in the nearby market

As Figure 19 shows that 56.46% agree and 37.18% strongly agree that they shop online as they

can buy products that are not easily available in the nearby market or are unique in some way.

5.13% of respondents disagree with that, and only 1.28% are indecisive.

Figure 20 Online shopping makes my shopping easy

From the figure above, we can see that the greatest number of respondents, 76.73%, say that

online shopping makes their shopping easy. They not have to wait in a line or wait till the shop

assistant is ready to help them with their purchases. They can do their shopping in minutes even

if they are busy apart from saving time and avoiding crowds. Only 7.79% do not think so, and

15.58% are indecisive.

25

Figure 21 Online shopping procedure is cumbersome and frustrating

Considering the results from previous question, it was to be expected that majority of

respondents will not agree that online shopping is frustrating. 60.53% of them disagree that

online shopping procedure is cumbersome and frustrating. 11.84% agree with that, and a pretty

high percentage, 27.63% are indecisive.

Figure 22 I feel that my credit-card details may be compromised and misused if I shop

online

Making payments online is usually safe but not always. It is very interesting that almost equal

number of respondents have an opposite feeling regarding this question. 34.67% of respondents

agree and disagree that they feel that their credit card may be compromised and misused when

they shop online. Quite a large number of respondents, 33.33%, are indecisive about this feeling.

26

Figure 23 I feel that my personal information given for transaction to the retailer may be

compromised to 3rd

party

As Figure 23 shows answers to this question are quite similar as to previous one. 38.60% of

respondents feel that their personal information given for transaction to the retailer may be

compromised to 3rd

party. 30.26% do not feel like that, and 31.58% are indecisive about this

feeling.

Figure 24 I might not get what I ordered through online shopping

Sometime online buyers may face delivery risk. Delivery risk occurs when the seller fails to

deliver the original product or delivers a damaged (inferior/duplicate) product due to shipping

problems. Results show that 40.26% of respondents agree that they might not get what they

ordered through online shopping, 37.67% of respondents disagree on that, and 22.08% are

indecisive about not getting what they ordered.

27

Figure 25 It is hard to judge the quality of merchandise over Internet

Figure 25 shows that 64.93% of respondents agree that is hard to judge the quality of

merchandise over the Internet. 18.18% disagree with that and 16.88% are indecisive.

Figure 26 Finding right product online is difficult

As Figure 26 shows, 56.58% of respondents disagree, and 10.53% strongly disagree that finding

the right product online is difficult. Only 7.90% of respondents disagree with that, and 25.00%

are indecisive.

28

Figure 27 If I shop online I cannot wait till the product arrives

From Figure above, we can see that 36.00% of respondents agree that they cannot wait till the

product arrives, 38.67% disagree with that, and 25.33% are indecisive about that.

Figure 28 I cannot get to examine the product when I shop online

As it was expected, majority of respondents or 67.11% agree that they cannot manage to

examine the product when they shop online, 15.79% of them disagree with that, and 17.11% are

indecisive.

29

Figure 29 I might not receive the product ordered online

Figure 29 shows that 46.06% of respondents agree that they might not receive the product

ordered online, 30.26% disagree with that, and 23.68% are indecisive.

Figure 30 I purchase online only when I can return the product without any frills or strings

attached

Figure 30 shows that 41.54% of respondents shop online only when they can return the product

without any frills or strings attached. 27.27% of respondents disagree on that, and 31.17% are

indecisive.

30

Figure 31 I do not purchase online if there is no money back guarantee

Figure 31 shows that 55.27% of respondents do not purchase online if there is no money back

guarantee, 23.68% disagree with that, and 21.05 are indecisive.

Figure 32 Using Internet for online shopping is easy

As Figure 32 shows, majority of respondents, 59.74% of them agree and 28.57% strongly agree

that using Internet for online shopping is easy. Only few of them or 3.90% disagree with that,

and 7.79% are indecisive.

31

Figure 33 Shopping online is fun and I enjoy it

From the figure above, we can see that 61.04% of respondents agree and 15.58% strongly agree

that shopping online is fun and that they enjoy it. Only 5.19% of them disagree with that, and

18.18% are indecisive.

Figure 34 I will have no problem in shopping online if I get to know that my friends and

relatives are doing it without any problems

Data show that 66.24% of respondents will not have problem in shopping online if they get to

know that their relatives and friends are doing it without problems. Only 9.09% disagree with

that, and 24.68% are indecisive. Next few questions are about the behaviour of online buyers.

32

Figure 35 What is the Internet the mostly used for

As illustrated by the Figure 35, 32.47% of respondents most often use Internet for searching

information, 22.08% of them use Internet mostly for work, 16.88% of them for browsing,

12.99% for E-mailing, 10.39% for Social networking, and 5.19% of them for entertainment.

Figure 36 How many times have you bought electronic goods over the Internet

Figure 36 shows that 51.95% of respondents have bought electronic goods 1-5 times during the

past six months. 28.57% of respondents have not bought electronic goods during the same period.

11.69% of respondents have bought electronic goods 5-20 times during the past six months and

1.30% of respondents have done it more than 20 times during the same period.

33

Figure 37 How much do online buyers spend on online shopping of electronic goods per

month

When it comes to amounts respondents claimed to be willing to spend for online shopping,

looking at the Figure 37, it is clear that majority of respondents spend up to 50BAM per month.

This can be an indicator of either distrust towards online shopping or a general picture of

economic status of respondents. 34.72% of respondents spend from 50BAM to 200BAM and

only 5.56% spend more than 200BAM per month on buying electronics online. This is an

important detail for creating a Bosnian online shopping customer profile.

Figure 38 Crucial factors that affect online buyer’s decision making

As illustrated in Figure 38, 67.53% of respondents find that the main advantage of internet

shopping is purchase of products at lower prices, 66.23% of respondents purchase online because

34

of the lack of products at domestic market, 25.97% or respondents buy online because of the

ability of price comparison, 24.68% because of the ability of product review, and 19.48% of

respondents buy online because of convenience and time saving.

Figure 39 The way that online buyers find the sales channels

As Figure 39 shows, 42.67% of online buyers of electronics in Bosnia and Herzegovina find the

online sales channels through recommendation from their friends and families. 24.00% of

respondents find it through Social media advertising, 14.67% trough Google AdWords, 13.33%

through Web banners, 4.00% on TV, and 1.33% find it through flayers.

35

Figure 40 The main barriers which keep people away from shopping online

The most frequently cited risk associated with online shopping include financial risks. That is

why 49.35% of respondents find that the main barrier which keeps them away from shopping

online is safety of payment. 44.16% of them for the main barrier find high shipping costs,

25.97% find low trust level of online store/Brand, 22.08% find warranty and claims, 20.78% find

too slow delivery, 18.18% refund policy, 15.58% find value added tax/customs duty, and 10.39%

of respondents do not find none of the above as barriers.

3.1. Discussion

This study was conducted among 120 respondents from across the Bosnia and

Herzegovina. 102 of them completed the questionnaire and used it as valid. 54.22% of them are

male and 45.78% respondents are female; 31.33% are between 18-29 years old and 68.67%

respondents are between 30-49 years old. Most of them (72.30%) are highly educated having at

least college education. The most numerous respondents (35.37%) are those who have monthly

income between 1,001 and 1,500BAM (Bosnian Convertible Mark), followed by 21.95% of

those with income between 701BAM and 1,000BAM. It is interesting that 38.55% of the

respondents have been buying online for more than 3 years longer than one year and only

13.25% of respondents have been using Internet for shopping less than 6 month. During last six

month, 51.95% of respondents have bought electronic goods on the Internet, and 28.57% did not

36

do so during the same period. For only 11.69% of respondents we can say that they are frequent

buyers because they have bought online 5-20 times during last six months. Interesting is that

62.26% of buyers aged between 30 and 49 years have bought online 1-5 times during past six

month, and 41.67% of younger respondents have nothing bought online during that time.

Results show that online buyers use Internet mostly for searching information (32.47%) and

work (22.08%). When it comes to amounts, majority of respondents spend up to 50BAM per

month.

As the crucial factors which affect their decision making in the final selection of the product

respondents state the best prices (67.53%) and availability of products that are not available in

local stores (66.23%). And as the main barriers which keep respondents away from online

shopping are safety of payment (49.35%) and high shipping costs (44.16%).

Price

H3 is significantly supported because 67.53% of respondents find that the main advantage of

internet shopping is the purchase of products at lower prices which is the main factor that affects

consumer decision to purchase online. 66.23% of respondents buy online due to unavailability of

desired products at the especially domestic market. It is found that product price is more

important to younger buyers, aged between 18 and 29 (94.67%) than those between 30 and 49

years old (85.19%). But, both male and female respondents mostly will not purchase the product

when the price is not acceptable to them. Free gift is price advantage more for female (100%)

than for male (88.64%). Also, female respondents (64.71%) and younger buyers aged between

18 and 29 (66.67%) are more willing to pay higher price for products that are not available in

solid shops.

Convenience

Results of testing H1 indicated that individual demands had positive influence on online

consumer purchase decision and behaviour. This survey indicated that the vast majority of

respondents (93.59%) used online shopping for buying products which are otherwise not easily

available in the nearby market or are unique. The majority of respondents (75.64%) shop online

37

as they get broader selection of products online. This convenience means more to female buyers

(82.36%) than male buyers (70.46%). The ability of easy price comparison in online shopping is

very important to 78.21% of respondents and 63.53% of respondents shop online as they get

user/expert reviews on the product. It is interesting that convenience of not having to leave

home for shopping is not so important for Bosnian buyers because only 31.17% of respondents

said that they shop online as they do not have to leave home for shopping. Also, only 17.95% of

respondents shop online as they can shop whenever they want, which makes us to conclude, that

they do not consider this convenience particularly important. But, time is an important factor for

75% of respondents in sense that they can take as much time as they want to decide.

Supporting the hypothesis H2 indicated that attitude of consumers towards online shopping

significantly affected their online shopping behavior. For majority online buyers online shopping

is easy (88.31%) and fun (76.62%). That is why it was expected that majority of respondents

disagree that online shopping is difficult. However, online buyers need to wait until their order

arrives, and data show that only 36.00% of respondents are impatient with waiting for online

purchase to arrive. Thus when a consumer has a significant attitude toward online shopping, this

will have effect on his/her shopping behavior.

Quality

Results show that H4 is supported because the majority of respondents (67.11%) find that they

cannot get to examine the product when they shop online. 64.93% of respondents think that is

hard to judge quality of merchandise over the Internet. Data show that this is something harder

for male (70.46%) than female buyers (57.57%).

Trust

H5 is supported because results show that respondents are mostly aware of possibility of losing

money and financial details, which have negative effect on attitude toward online shopping.

Before purchasing a product, a consumer considers the various risks associated with the purchase.

Also, the fear of non-delivery of order will have negative influence on attitude towards shopping

online even though only 46.06% of respondents are aware of possibility of not receiving the

38

product ordered online. In the respect of financial risk, data show that respondents are quite

careful because 55.27% of respondents do not purchase online if there is no money back

guarantee. Interesting is that 47.72% of male buyers and only 25% of female buyers feel that

their personal information given for transaction could be compromised by 3rd

party.

Bosnian people are very close to their friends and relatives, and their recommendation will have

a major impact on their trust in online buying. That is why majority of respondents (66.24%) said

that they would have no problem in shopping online if they got to know that their friends and

relatives were doing it without any problems. The way online buyers find sales channels is very

important for online marketers. The results of this survey show that respondents mostly find it

mostly through recommendation from their friends and families (42.67%) followed by Social

media advertising (24.00%), Google AdWords (14.67%), Web banners (13.33%), television

(4.00%) and flyers (1.33%).

3. CONCLUSION

Online shopping is becoming more popular day by day with the increase in the usage of

World Wide Web known as www. Understanding customer’s need for online selling has become

challenge for E-marketers. Specially understanding the consumer’s attitudes towards online

shopping , making improvement in the factors that influence consumers to shop online and

working on factors that affect consumers to shop online will help marketers to gain the

competitive edge over others. The growing use of Internet in Bosnia and Herzegovina provides a

developing prospect for E-marketers. Therefore this study has focused mainly on the factors

affecting online Bosnia and Herzegovina buyers’ behaviour. The main influencing factors have

been identified as Price, Trust and Convenience. The results of this research show that all set

hypothesis are supported.

Survey which is conducted in this work shows that online buyers in Bosnia and Herzegovina are

mostly highly educated, between 18 and 49 years old, with monthly income between 1000BAM

and 1500BAM.

39

In conclusion online buyers in Bosnia and Herzegovina are very price sensitive oriented

and convenience oriented. Regarding trust the most frequently cited risk include financial risks.

Online buyers are very cautious with risks associated with the purchase. We can suppose that this

is the reason why majority of respondents usually do not buy expensive goods and mostly spend

maximum 50BAM per month. It is found that there is no significant difference between male and

female purchasing behavior. Also, online buyers of different age have very similar behavior

which is a very important for e-marketers that easily can reach a wide target audience. Results

show that online buyers use Internet mostly for searching information and work. The main

reasons for buying online are best prices and availability of goods that are not available in local

market. Regarding convenience the most important for online buyers is ability to compare prices

easily and get users/experts reviews on products. In contrast to this, time saving in the sense that

they do not have to go out for shopping but can shop from home is not so important to them.

Table 1.

Summary of the Seven Hypotheses and Outcomes

Hypothesis Outcome

H0: There is a relationship between factors affecting consumer behaviour and

online shopping.

Supported

H1: Individual demands have positive influence on online consumer

purchase decision and behaviour.

Supported

H2: Consumers attitude has influence on online consumer purchase decision

and behaviour.

Supported

H3: Reasonable price strategy has positive influence on online consumer

purchase decision and behaviour.

Supported

H4: Product quality has positive influence on online consumer purchase

decision and behaviour.

Supported

H5: Web trust has positive influence on online consumer purchase decision

and behaviour.

Supported

H6: Online consumer purchase decision and behaviour has positive influence

on repeated purchase bahaviour.

Supported

40

Understanding relationships between these factors and the profile of online buyers can provide

further development of e-marketers and their marketing strategies to convert Internet users into

online buyers while retaining existent online customers

Literature Review

This literature review section refers to a range of papers that are relevant to the current

situation of online shopping. The research papers have been chosen as they identify the factors

that affect online shopping of electronic goods. Many previous papers have analyzed online

shopping behaviour: for example, Hunt (2007) discussed the various methods of online

shopping; Wolfinbarger (2001) studied the situations involved in online shopping; and Kimberly

(2007) talked about the difference between online shopping and retail shopping. These papers

discussed online shopping behaviour of many kinds of consumers in connection with a wide

product range. This study focuses more specifically on how electronics are purchased by

Bosnians. The electronics is chosen as the focus of this study as it has become a necessary part of

our modern culture. Electronic industry is developing rapidly and as technology develops,

electronics become progressively cheaper while performance increases (Weiser, 1999).

Much research has been concentrated on the online shopping in the world. However, there is still

a need for closer examination on the online shopping buying behaviour in specific countries.

While both established and new, large and small scale businesses are now using the Internet as a

medium of sales of their products and services. The products variety, services, efficiency,

security and popularity of online shopping also develop quickly, it is necessary for the online

shopping industry to have continuous improvement to meet consumers changing needs and

expectations. Still there is a huge research gap not only between countries, but especially

between developed and developing countries, which may differ significantly between countries

that limit the generalization of research results from developed countries to developing country

contexts.

41

Appendices

Questionnaire for participants of the survey

Section-1: In this section you will be asked about demographics.

1. Do you live in Bosnia and Herzegovina?

a. Yes

b. No

2. What is your gender?

a. Male

b. Female

3. What is your age?

a. 18-29 years old

b. 30-49 years old

c. over 50 years old

4. What is the highest level of education you have completed?

a. High school

b. College

c. Bachelor

d. Postgraduate or more

5. What is your monthly income?

a. Up to 700KM

b. 701-1000KM

c. 1001-1500KM

d. 1501-3000KM

e. More than 3000KM

6. For how long you have been using Internet for shopping:

a. Less than 6 Months

b. 6 - 12 Months

c. 1 - 3 Years

d. More than 3 Years

e. Do not use at all

42

Section-2: In this section you will be asked about price factor. Please indicate the number that

best indicates the degree to which you agree or disagree with each of the following statements.

1 means "Strongly Disagree", 2 means "Disagree", 3 means "Indecisive", 4 means "Agree" and 5

means "Strongly Agree".

7. The lower price of the same product at solid shops is an advantage when I shop online.

1 2 3 4 5

8. Free delivery charge is a price advantage when I shop online.

1 2 3 4 5

9. Product price is important to me when I shop online.

1 2 3 4 5

10. I am willing to pay for a higher price for product(s) that is/are not available in solid

shops.

1 2 3 4 5

11. Free gift is a price advantage when I shop online.

1 2 3 4 5

12. I will not purchase the product when the price is not acceptable to me when I shop

online.

1 2 3 4 5

Section-3: In this section you will be asked about convenience of online shopping. Please

indicate the number that best indicates the degree to which you agree or disagree with each of the

following statements. 1 means "Strongly Disagree", 2 means "Disagree", 3 means "Indecisive", 4

means "Agree" and 5 means "Strongly Agree".

13. I shop online as I do not have to leave home for shopping

1 2 3 4 5

14. I shop online as I can shop whenever I want

1 2 3 4 5

15. I shop online as I can get detailed product information online

1 2 3 4 5

16. I shop online as I get broader selection of products online

1 2 3 4 5

17. Online shopping gives facility of easy price comparison (Hence, price advantage)

1 2 3 4 5

18. I shop online as I get user/expert reviews on the product

1 2 3 4 5

43

19. I shop online as I can take as much time as I want to decide

1 2 3 4 5

20. I use online shopping for buying products which are otherwise not easily available in

the nearby market or are unique (new)

1 2 3 4 5

21. Online shopping makes my shopping easy

1 2 3 4 5

22. Online shopping procedure is cumbersome and frustrating

1 2 3 4 5

Section-4: In this section you will be asked about perceived risks, shopping habits and shipping

of online shopping. Please indicate the number best indicates the degree to which you agree or

disagree with each of the following statements. 1 means "Strongly Disagree", 2 means

"Disagree", 3 means "Indecisive", 4 means "Agree" and 5 means "Strongly Agree".

Perceived Risks:

23. I feel that my credit-card details may be compromised and misused if I shop online

1 2 3 4 5

24. I feel that my personal information given for transaction to the retailer may be

compromised to 3rd party

1 2 3 4 5

Product Risk:

25. I might not get what I ordered through online shopping

1 2 3 4 5

26. It is hard to judge the quality of merchandise over Internet

1 2 3 4 5 6 7

Convenience Risk:

27. Finding right product online is difficult

1 2 3 4 5

28. If I shop online I cannot wait till the product arrives

1 2 3 4 5

29. I cannot get to examine the product when I shop online

1 2 3 4 5

Non-delivery Risk:

30. I might not receive the product ordered online

1 2 3 4 5

44

Return Policy:

31. I purchase online only when I can return the product without any frills or strings

attached

1 2 3 4 5

32. I do not purchase online if there is no money back guarantee

1 2 3 4 5

Section-5: The following questions try to assess some factors that are likely to influence your

online shopping intention. Please indicate the number best indicates the degree to which you

agree or disagree with each of the following statements. 1 means "Strongly Disagree", 2 means

"Disagree", 3 means "Indecisive", 4 means "Agree" and 5 means "Strongly Agree".

33. Using Internet for online shopping is easy

1 2 3 4 5

34. Shopping online is fun and I enjoy it

1 2 3 4 5

35. I will have no problem in shopping online if I get to know that my friends and relatives

are doing it without any problems

1 2 3 4 5

Section-6:

Part-1: The following part will just ask you about your online behavior. Please mark one of the

14 below options in terms of times spent or frequency of use. (Example: If you spend maximum

out of total time spent on Internet in information search then mark it).

36. I use the Internet mostly for:

a. Browsing

b. Information search

c. E-mails

d. Chatting

e. Work

f. Social networking

g. Blogging

h. Entertainment

i. Buying

j. Banking

k. Product Search

45

l. Do not use

Part-2: The following part will just ask you about some more questions on your online behavior.

(Please select the one you find most appropriate in your case).

37. If you have, then how many times have you bought electronic goods on Internet (during

the past six months)?

a. Never

b. 1-5 times

c. 5-20 times

d. More than 20 times

e. Not sure

38. How much do you spend on online shopping of electronic goods per month?

a. Up to 50KM

b. 50-200KM

c. More than 200KM

39. What are the crucial factors which affect your decision making in the final

selection of the product ( Select all of the answers that apply)

a. The Best prices

b. Convenience & Time saving

c. Not available in local stores

d. Price comparison available

e. Product reviews available

40. How did you find the online sales channel?

a. Recommendation from may family/friends

b. Social media advertising

c. Web banner

d. Google AdWords

e. TV

f. Radio

g. Newspapers/Magazines

h. Flyer

46

i. Mobile advertising

41.What are the main barriers which keep you away from shopping online?

a. Safety of payment

b. Low trust level of online store / Brand

c. Value added tax / customs duty

d. High Shipping Cost

e. Refund Policy

f. Warranty and claims

g. Delivery too slow

h. None of the above

47

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8. Hoffman, D.L., Novak, T. P. and Peralta, M., “Building consumer trust online”,

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Vita

Biljana Lukić was born in Gradiška, Bosnia and Herzegovina on 25th of March

1976. She attended Faculty of Technology at University of Banja Luka from 1994 to 2003 and

received Master of Science in Textile Engineering. After the graduation she was working in

“BHV Consulting” from Croatia for four years. As a general director she started up the

business in the Bosnia and Herzegovina and had a good cooperation with eminent universities

and organizations from all over the World. Looking for new challenges, she continued her

career in the retail chain "Pevec" as a Director of Marketing and PR Department where she

gained a lot of experience in the field of marketing and public relations. For the last four years

she has been running Marketing, Communications and PR Department at “Triglav Insurance”.

In the year 2011, she completed “Triglav International Business Academy”, school for

prospective employees of Triglav Group at the University of Ljubljana. Beside numerous

seminars and trainings in the field of marketing, public relations and management, in 2012 she

attended “Marketing Academy of Triglav Group”. In the fall of 2012 she began her work for

her Master’s Degree in Business Administration at American University in Bosnia and

Herzegovina.