Essay: Factors that affect the consumer purchase intention toward mobile shopping

CHAPTER 1: INTRODUCTION.

1.1 Background of the Study

In this globalized 21st century, using mobile phone to purchase product or services online is very common as many people have found that it is simply easier to purchase items online. Some of the people prefer to purchase product or services from shopping website through mobile phone because they can purchase the goods without going out and it brings a lot of benefits to them. Because of the rapid growth in information technology, market, and competitors, mobile shopping not only sell goods to the customers, it also build and retains long term relationship among the customers. Mobile commerce has frequently been proclaimed the new service frontier (Kleijnen et al., 2007). Increased mobile usage in recent years is a clear example of the system’s growth, significance and the opportunities it offers as an independent sales channel, and therefore merits special attention from researchers(Joaquin Aldas-Manzano, 2008)

Mobile Shopping is a the process consumers go through to purchase products or services over the internet using the mobile phone such as PDA, Smartphone, HTC and etc. Besides that, mobile shopping or mobile purchasing also known as M-shopping(online shopping goes mobile). Besides that, mobile shopping allows customers to shop online at any time in any location. Customers can browse and order products while using a cheap, secure payment method. Instead of using paper catalogues, retailers can send customers a list of products that the customer would be interested in, directly to their mobile device or consumers can visit a mobile version of a retailers ecommerce site. Additionally, retailers will also be able to track customers at all times and notify them of discounts at local stores that the customer would be interested in(PriceGabbers.com, Consumer Behavior Report 2009).

Mobile Shopping is set to revolutionize mainstream online shopping by enabling customers to shop for virtually anything from clothing to appliances by using their hand-held mobile phones. Aside from an attempt to boost its revenues, mobile online shopping hopes to widen the mobile phone user base by pushing them to use their cellular phones for data services such as Internet surfing and video and music downloads. Online shopping has long been a mainstay in the World Wide Web however mobile commerce has yet to push the slow adoption of online shopping into Web-surfing using mobile phones.

As the number of mobile telecom users increases, the decline in conventional voice service tariffs has reduced the average revenue per user making mobile value-added services, like mobile shopping, a new opportunity for providers to increase revenue (Kuo and Yen, 2009).

By encouraging customers to use their mobile phones for mobile shopping, mobile industry revenues are likely to increase exponentially considering the convenience and ease that it’s provides as compared to mainstream online shopping This will also increase the investments that online advertisers will make in the mobile industry.

When using Mobile Shopping, users can conveniently search for a particular product at the lowest price or browse for products by retailer or category. Once the particular product is selected, customers can email product details to themselves for future reference, forward it to a friend or buy the product directly using their cellular phone. Other than that, Mobile users using the several kind of technologies such as 3G, Wi-Fi and GPRS to shop online through the mobile phone.

3G is the third generation of mobile phone standards and technology. 3G supersedes 2G technology and precedes 4G technology. 2.5G was a temporary bridge between 2G and 3G. 3G technologies enabled faster data-transmission speeds, greater network capacity and more advanced network services(Adam Fendelman, 2006).

Wi-Fi cell phones are those that can connect to two different kinds of voice data networks to make and receive calls. Such phones improve phone reception and reduce dropped calls. Wi-Fi cell phone technology is derived from VoIP (voice over internet protocol) technology, such as Skype, that allows users to make free calls over their internet connection. Many cell phones have Wi-Fi capabilities allowing them to connect to the internet to browse websites and download applications(Maxwell Payne, 2006).

General Packet Radio Services (GPRS) is a packet-based wireless communication service that promises data rates from 56 up to 114 Kbps and continuous connection to the Internet for mobile phone and computer users. The higher data rates allow users to take part in video conferences and interact with multimedia Web sites and similar applications using mobile handheld devices as well as notebook computers. GPRS is based on Global System for Mobile (GSM) communication and complements existing services such circuit-switched cellular phone connections and the Short Message Service (SMS).

1.2 Problem statement

Most of the people like to use the computer to surf the internet for purchasing product and services rather than the mobile phone. Some people using the mobile phone to surfing internet need to waiting 10 -15 second then only appear the website but at the same time, it will charge the money for surfing internet on mobile phone. So the people think that it’s quite expensive when shopping on internet through mobile phone.

With the improvement in technology and wide use of internet, mobile shopping will getting popular around the world and the percentage of customers making purchase through the internet using the mobile phone will be increasing. So the mobile shopping is playing important role in affecting the consumer purchase intention. Customers do not only buy the product but they also enjoy using the mobile phone and on focused on the mobile shopping service provided by the mobile companies.

1.3 Objective of Study

The main objective of this study is to find out the introduction and history of mobile commerce and mobile shopping and factors that affect the consumer purchase intention toward mobile shopping. The main objective can be complemented by three objectives which is :

i. To study the background and history of mobile shopping.

Before we want to find what is the factor that affect the consumer purchase intention towards mobile shopping, we have to study what is the background and history mobile shopping. Besides that, most of the people in the world have using the mobile phone to surfing internet, making a call, send message and etc and mobile phone has become a part of their life.

ii. To investigating the factor that affect the consumer purchase intention towards mobile shopping.

After we know what is the background of mobile shopping and history, we have to find more journal or article as much as we can in order to investigate what is the most suitable factor that affect the consumer purchase intention towards mobile shopping.

iii. To identify most suitable variable and affect the consumer purchase intention toward mobile shopping.

After find the journal and article from the website, we have to identify which variable are most suitable independent variable that affect the consumer purchase intention towards mobile shopping. We also can refer other useful journal such as mobile commerce, mobile internet, technology acceptance model(TAM) related to the mobile shopping.

1.4 Justification of Study

This research studies the conduct of using mobile phone for online purchase and factors that affect the consumer purchase intention. The implication in discussed based on the importance of mobile shopping and also the responses of the customers toward mobile shopping. Previous research studies on the factor of affect the consumer purchase intention toward mobile shopping. This research however studies of 8 variables which are mobile skillfulness, ease of use, usefulness, compatibility, enjoyment, price, information content, privacy and security. It is to noted that previous studies have different variables, there are some variables which have not yet been developed by other research, such as price, internet experience and information content. As such, this motivates the present research. Since the mobile shopping is becoming a new trend of transaction, this research will determine the factors that affect the consumer purchase intention toward mobile shopping.

1.5 Methodology

This study is carried out based on primary data and secondary data collection.

Primary data is obtained through questionnaire surveys and interview .The study consist of a survey which is related to the factor that affect the consumer purchase intention towards mobile shopping.

The survey which consists of 200 questionnaires is designed to certify the research topic and to collect the information and opinion of the group of people about the factor that affect the consumer purchase intention towards mobile shopping.

An interview is conducted on a sample population who are around 15 to 25 years old who are also mobile users, having the experience in using mobile phone purchasing through online. These populations are secondary school, high school, MMU students, working and etc.

Besides that, to measure the dependent and independent variables, a system called SPSS is used to analyze the data collected through the survey. Besides that, SPSS system is also used to test the relationship between the dependent variable and independent variable which will be selected. SPSS is also used to support and determine the most appropriate the hypothesis.

On the other hand, secondary data is obtained through references such as relevant books, journals, articles, dissertations, information from internet and other information found that related to identify, guide and support the title of study and topic in the research, Li and Reima (2007) states that literature review is a necessary step in structuring a research field and forming an integral part of any research conducted.

Literature review is a valid approach, which helps to identify the conceptual content in mobile shopping and guides towards the theoretical development in mobile shopping field. Besides that, (Cooper, H. (1998) state that the literature review should consist synthesis that informs the reader of the state of play respecting the topic, i.e., what is–and what is not–currently known about it ; Statements identifying points of scholarly contention concerning the topic and statements which point to areas in need of further research. Further details on methodology will be discussed in Chapter 3.

1.6 Organisation of Research Project

This study consisted of three chapters. The outline of this research is as following:

 

Chapter 1: Introduction

The chapter 1 which is introduction begins with an overview of the topic which is history of mobile internet and definition of mobile shopping. The next is the problem statement states the key issues that arise in order to understand the factors that affect the consumer purchase intention on mobile shopping. The objectives of study conducted that is needed to find out followed by the justification of study which states the reasons needed to do this research.

 

Chapter 2: Literature Review.

This chapter is mainly about the proof reading of literatures relevant to the area of interest of study. According to Cooper (1988), a literature review uses as its database reports of primary or original scholarship, and does not report new primary scholarship itself. The primary reports used in the literature may be verbal, but in the vast majority of cases reports are written documents. The types of scholarship may be empirical, theoretical, critical/analytic, or methodological in nature. Second a literature review seeks to describe, summarize, evaluate, clarify and/or integrate the content of primary reports. The review of relevant literature is nearly always a standard chapter of a thesis or dissertation. The review forms an important chapter in a thesis where its purpose is to provide the background to and justification for the research undertaken (Bruce, 1994) Literature review serves as a foundation for any research study. It provides an insight to the subject of a particular study. Most of these literatures are retrieved from relevant journals and articles. This review of pertinent literature covers the individual behavior as driver of using mobile shopping, affect the consumer purchase intention and various studies on mobile shopping and acceptance of mobile internet, done by past researchers in different countries.

 

Chapter 3: Methodology.

In this chapter, the samples of population and research methodology are defined. Sample size, data collection methods and evaluation periods are defined in detail. A discussion on the respondents will also take place in this chapter.

 

CHAPTER 2: LITERATURE REVIEW

2.1 Introduction

This chapter discusses the history of mobile commerce and mobile internet, acceptance of purchase the goods and services through internet using mobile phone, how it comes about, how it developed, and how it is measured. In addition, the list of factors that affect the customer purchase intention on mobile shopping web site are provided in this chapter. The research framework that is used to guide the study is shown in the next chapter, which suggests that mobile skillfulness, ease of use, usefulness, compatibility, enjoyment, price, information content and privacy and security that affect the consumer purchase intention towards mobile shopping . This section elaborates on the theory base and derives the hypotheses.

2.2 Mobile commerce

2.2.1 History

Mobile Commerce is any transaction, involving the transfer of ownership or rights to use goods and services, which is initiated and/or completed by using mobile access to computer-mediated networks with the help of an electronic device. The product and services available in mobile commerce such as mobile ticketing, mobile vouchers, coupon and loyalty cards, mobile shopping, mobile banking, mobile marketing and advertising and etc. Because of mobile shopping is a subset of mobile commerce, so we have to know what is the mobile commerce and how it developed.

As mobile commerce is a relatively new concept, there have been various definitions of m-commerce. Abu Bakar and Osman (2005) defined m-commerce as exchange or buying and selling of commodities and services through wireless handheld devices such as cellular telephones and personal digital assistant (PDAs). Moshin et al. (2003) stated that the most common definition of m-commerce actually represents the extension of e-commerce. Previous researchers suggested that m-commerce is more than e- commerce due to its different interaction style, usage pattern and value chain and new and innovative business opportunity with its own unique characteristics and functions, such as mobility and broad reachability. Feng et al. (2006)

In Korea, there has been a rapid increase in the number of mobile phone users
since the late 1990s, a trend that has been continuously and strongly upward (National Computerization Agency, 2004). Under this circumstance, new needs for using the Internet beyond time and place brought mobile Internet (m-Internet) to the world. Belonging only to a specific individual, a mobile device allows users to access service more conveniently as well as to have more personalized services than those of the existing wired Internet. Especially in Korea, m-commerce market shows rapid growth thanks to the penetration of m-Internet; in 2006, Korean m-Internet subscribers total about 14.4 million, approximately 31.6 per cent of the Korean population over the age of
six (NIDA (2007)). The accessibility of m-commerce is an advantage over e-commerce as e-commerce applications usually need a wired end-user device (Schwiderski-Grosche
and Knospe , 2002). Given that mobile devices are usually owned by individual and not shared between different users, m-commerce allows the services to be catered towards the users’ needs (e.g. ringtones) (Schwiderski-Grosche and Knospe, 2002).

2.2.2 Mobile Internet

Mobile shopping is using mobile phone to shop online. That means mobile internet also a play key important role for the mobile shopping. So we have to know what is the mobile internet and how it is related with the mobile shopping.

The Mobile Web refers to browser-based access to the Internet or web applications using a mobile device connected to a wireless network. Traditional web access in comparison is desktop computer based via a fixed landline connection. The total number of mobile web users grew past the total number of desktop computer based internet users for the first time in 2008 (Tomi Ahonen Almanac, 2009).

However, Mobile Web access today still suffers from interoperability and usability problems. Interoperability issues stem from the platform fragmentation of mobile device devices, mobile operating systems, and browsers. Usability problems are centered around the small physical size of the mobile form factor (limited resolution screens and user input/operating limitations).

Moving forward, the distinction between the Mobile Web and native mobile applications is anticipated to become increasingly blurred, as mobile browsers increasingly gain direct access to the hardware of mobile devices (including accelerometers and GPS chips), and the performance of browser based applications improve (speed- and capability-wise). Persistent storage and access to sophisticated User Interface graphics functions may further reduce the need for the development of platform-specific native applications.( Tomi Ahonen Almanac, 2009)

It was very convenient and easier to using mobile phone to shop online through mobile internet, we just clicked some button and then can direct surfing the internet such as Wi-Fi , GPRS, and 3G to shop online.

2.2.3 Current trend in United States

Mobile technology may finally have reached an inflection point where the mobile Internet could be another viable consumer resource for online shopping and purchasing.

According to PriceGrabber.com’s Mobile Shopping Behavior Survey, 58 percent of US
online consumers already own a Web-enabled mobile phone. Furthermore, of those consumers that own a Web-enabled mobile phone, one in 10 has purchased products and/or services with their device. Although online consumers said the lengthy purchase process (38%) and challenges they face with completing a purchase transaction (28%) are preventing them from purchasing online from their mobile phone, 17 percent indicated they still engage in online shopping activities. As Web-enabled phone adoption continues to grow, with improvements in smartphone hardware and advances in mobile network service, more and more online consumers will interact with and purchase from the Web via their device. Mobile Internet consumer adoption is more widespread in the UK compared to that of the United States. More than two-thirds of UK online consumers own a mobile phone capable of connecting with the Internet and 64 percent own a 3G compatible Web-enabled mobile phone enabling them to make more secure and substantial purchases with their credit cards from their mobile phones.

PriceGrabber.com provides insight on current and future mobile Internet usage, specific to online consumers’ shopping and purchasing behaviors. This study is based on the Mobile Shopping Behavior Survey findings from 3,865 online consumers with mobile phones in the United States and the United Kingdom. While the mobile Internet has not developed as quickly on a global scale as many predicted, online consumers have made significant headway in Web-enabled mobile phone adoption and mobile Internet usage(PriceGrabber.com).

2.2.4 Simple Mobile Shopping(SMS) in United States

The Aruntx is a web site that provide the SMS Simple Mobile Shopping. Shop From Mobile Telephones. Aruntx offers safe, secure mobile shopping entitled SMS Simple Mobile Shopping. Shop anytime. Shop anywhere. The industry is flooding the market with a range of new devices that aim to bring the internet to handheld mobile users, and Aruntx Publishing Company, a Microsoft Solutions Provider has teamed up with Avaya, Motorola and Nokia to deliver to the marketplace outstanding server applications with no additional software need on the user device to browse the shopping centre, select a chosen item and purchase the item. Today, more than three million people in the United States use Blackberry’s and the rush for the mobile commerce holiday shopping season has begun. “We are absolutely entering the consumer segment,” said Jennifer Ledger Scott in a recent press interview. “It’s not just about work anymore but about life. Consumers want something they can take out and use socially – not necessarily the more bulky traditional sets, something that can deliver instantly”(http://aruntx.com/html/128.html).

2.3 Measuring the acceptance of mobile shopping

In measuring the acceptance of mobile shopping, Fred Davis and Richard Bagozzi (Bagozzi et al., 1992; Davis et al., 1989) the Technology Acceptance Model( TAM) which is an adaptation of the Theory of Reasoned Action (TRA) to the field of IS. TAM posits that perceived usefulness and perceived ease of use determine an individual’s intention to use a system with intention to use serving as a mediator of actual system use. Perceived usefulness is also seen as being directly impacted by perceived ease of use. Researchers have simplified TAM by removing the attitude construct found in TRA from the current specification (Venkatesh et. al., 2003). Attempts to extend TAM have generally taken one of three approaches: by introducing factors from related models, by introducing additional or alternative belief factors, and by examining antecedents and moderators of perceived usefulness and perceived ease of use (Wixom and Todd,2005).

TRA and TAM, both of which have strong behavioral elements, assume that when someone forms an intention to act, that they will be free to act without limitation. In practice constraints such as limited ability, time, environmental or organisational limits, and unconscious habits will limit the freedom to act

Earlier research on the diffusion of innovations also suggested a prominent role for perceived ease of use. analyzed the adoption, finding that compatibility, relative advantage, and complexity had the most significant relationships with adoption across a broad range of innovation types(Tornatzky and Klein (1982). Eason studied perceived usefulness in terms of a fit between systems, tasks and job profiles, using the terms “task fit” to describe the metric (Stewart, 1986).

2.4 Definition of independent variables

2.4.1 Mobile skillfulness

In this study, mobile skillfulness refers to the individual’s assessment of his/her ability to perform a specific task well while using a mobile phone. Bandura (1977, p. 193) also pointed out that “individuals can believe that a particular course of action will produce certain outcomes, but if individuals entertain serious doubts about whether they can perform the necessary activities, such information [about outcomes] does not influence their behavior”. It is necessary to understand the impact of one’s perceived level of skillfulness on the expectations of the usefulness of mobile shopping. The relationship between a person’s specific self-efficacy and a system’s usefulness and enjoyment has been supported in several previous studies (Huang and Liaw, 2005; Staples et al., 1999).

2.4.2 Ease of use (EOU)

Ease of use is an individual’s assessment of the extent to which interaction with a specific information system or technology is free of mental effort (Davis, 1989). The ease of use for a system is defined as the degree to which an individual believes that using a particular technology will be free of effort. Ease of use has been considered as an important determinant in adoption of past information technologies such as intranet (Chang, 2004), 3G (Liao et al., 2007), online banking (Guriting and Ndubisi, 2006; Jahangir and Begum, 2008), wireless internet (Lu et al., 2003), internet commerce (Cho et al., 2007) and m-commerce (Lin and Wang, 2005; Wang and Barnes, 2007; Kurnia et al., 2006; Mallat et al., 2006; Luarn and Lin, 2005). Extensive research since the late 1990s provides evidence of the significant effect. For example, several studies examined that user’s perceived ease of use perception influences significantly user’s intrinsic motivation (Hsu and Lu, 2007; Moon and Kim, 2001).

Ease of use has been shown to play an important role in determining the intention to use (Mao et al., 2005; Ong et al., 2004; Pijpers and van Montfort, 2005). Davis (1989) identified the freedom from effort in using a system as an important predictor for its adoption and subsequent usefulness. Much research has confirmed that the construct of freedom from effort has a strong effect on usefulness (Igbaria et al., 1997; Luarn and Lin, 2005; McFarland and Hamilton, 2006).

Besides that, Davis et al. (1989) proposed that Ease of use is an antecedent of perceived usefulness. Results from previous research revealed the significant relationship between two constructs, namely perceived ease of use on perceived usefulness (Davis et al., 1989; Kleijnen et al., 2004; Wang et al.2003).So perceived ease of use is a variable that will affect the consumer purchase intention towards mobile shopping and also will affect the usefulness of mobile shopping intention. It is one of the major behavioral beliefs influencing user intention to technology acceptance in both original and the revised TAM models and it has been included in this study to determine the consumer purchase intention towards mobile shopping as well.

The site-user understanding dimension reflects the consumer’s perception of the navigation on the site as a two-way relationship with the site. Like a personal relationship, consumers expect it to evolve in intimacy and understanding during the navigation. Shopping online essentially consists of a series of frequent actions by the shopper, such as clicking on links, buttons or entering words in a search, and reactions by the website, such as returning the page requested or the results to a search. So It’s easier for the consumer using the mobile phone to make a purchase such as download video clips, MP3, ringtones, software, and etc on the website.

2.4.3 Usefulness (U)

The usefulness in the TAM model was originally defined as the extent to which a person believes that using the mobile shopping would enhance his or her job performance and effectiveness( Davis, 1989) . The effect of PU on IU has been validated in many existing studies (Luarn and Lin, 2005; Lin and Wang, 2005; Guriting and Ndubisi, 2006). The ability to have immediate access to information about products or services anywhere, anytime, may be attractive to customers. The choice of mobile internet access also makes online shopping more effective. and previous researchers found that PU positively influences online purchase intentions and mobile internet activity, respectively(Cheong and Park, 2005; Chiu et al. 2005). There is extensive research in the information system that provides evidence of the significant effect of perceived usefulness on usage intention (Davis et al, 1989, Venkatesh & Morris, 2000). Numerous empirical studies have provided support for the proposition that perceived usefulness is the primary predictor of information technology usage (Davis, 1989; Davis et al., 1992; Igbaria et al., 1997; Gefen and Straub, 1997, 2000; Venkatesh, 2000; Venkatesh and Davis, 2000; Gefen, 2003; Hsu and Lu, 2004; Ong et al., 2004). Besides that, other researcher state that PU has a positive effect on USINTs of mobile banking customers (Luarn and Lin ,2005),.

Based on Chau’s modified TAM model, Jiang et.al (2000) developed that utilization of internet technology is to explore user acceptance of internet. Testing the utilization of the internet technology model confirmed that utilization of the internet technology is positively related to perceived usefulness.

2.4.4 Compatibility

Compatible capable of being used with or connected to other devices or components without modification and The ability of one device or program to work with another device or program. The term compatible implies different degrees of partnership. For instance, a printer and a computer are said to be compatible if they can be connected to each other. Recently, mobile communication has become pervasive and has reached almost every domain of modern people’s activities, including work, education, social relationships, and even entertainment. The diffusion of mobile technology will continue to construct the experiences and values of people’s lives.

Compatibility, one determinant of Rogers’s diffusion of innovation (DOI) theory, has been extensively quoted in studies that examine what facilitates the diffusion of innovative systems (Niina et al., 2008; Chen et al. 2002). Compatibility refers to the degree to which an innovation is perceived to be consistent with the values, past experiences, and needs of potential adopters (Roger, 1995). Mobile technology is already deeply integrated into many people’s lives. One prior empirical study (Niina et al., 2008) suggested that the compatibility of a mobile ticketing service with consumer behavior is a major determinant of adoption. (Sooryamoorthy et al. 2008) pointed out, consumers can be characterized as users of multiple communications media: mobile phones are becoming a part of their “technology cluster” involving computers, connectivity, internet and e-mail use. Previous researcher report similar adoption patterns for mobile phone and internet use (Rice and Katz, 2003). This finding highlights the complementarily of technologies in which users tend to adopt other innovations with broadly similar functions.

2.4.5 Enjoyment

Enjoyment is the condition of enjoying anything; pleasure or satisfaction, as in the possession or occupancy of anything; possession and use; as, the enjoyment of an estate(www.yourdictionary.com). A person will be more motivated to do or repeat an enjoyable activity that I enjoyable more as compared to the same activity which is not enjoyable.

Mobile phones provide a wide range of online display media, such as product descriptions, pictures, background music, videos, commercial flash animations, and marketing games. Customers can have fun searching for products and services while interacting with media provided by the mobile internet. (Davis et al. 1992) found both extrinsic and intrinsic factors affect consumers’ motivations to use information technology systems. Beside that, (Venkatesh, 1999) game-based training study found that high-level intrinsic motivations led to a sustained behavioral intention to use information software. In this study, enjoyment refers to the customers’ direct experience of immediate pleasure and joy from using the mobile shopping(Davis et al., 1992). (Hsu and Lu 2007) suggested that enjoyment positively affects the loyalty of online game customers.

2.4.6 Price

Price can defined as The sum or amount of money at which a thing is valued, or the value which a seller sets on his goods in market; that for which something is bought or sold, or offered for sale; equivalent in money or other means of exchange; current value or rate paid or demanded in market or in barter; cost. .Beside that, previous researchers state that price play important role in the choice and decision and also is the major factor of measuring consumer sensitivity(Krishnarmurthi and Raj, 1998).So the cost of using the internet also will affect the consumer purchase intention towards mobile shopping.

In the mobile internet context, the cost of using the internet through mobile phone include into two parts. First, the customer pay for the device that enables them to connect to the mobile network. Second, they also pay for subscribing the service. It could be fixed monthly charges, per-minute charges, per-packet charges or mixed(Je Ho Cheong and Myeong-Cheol Park, 2004). So very few people are using the mobile phone to shop online because of the cost of using internet through mobile phone are much higher.

The service cost used in most previous researches, is not objective term, but subjective term because it refers to the perceived level of value that individuals are willing to pay for the service. Previous researchers examined that the price has significant impact in the development of initial willingness to e-shop on the internet.(Liao and Cheung, 2001).

2.4.7 Information content

Information content defined as term with many meanings depending on context, but is as a rule closely related to such concepts as meaning, knowledge, instruction, communication, representation, and mental stimulus. Information content will be affect the consumer purchase intention towards mobile shopping because without the product’s information, the consumer will think that it’s unsafely and won’t shop online through the mobile phone.

A key feature of the internet lies in its role of facilitating those information searches for consumers (Brown, Pope and Voges, 2001). According to them, the product acquisition process is enhanced by enabling consumers to access a greater amount of detailed information with regard to product attributes, comparative pricing, availability, and overall value proposition, particularly when the Internet is used in conjunction with a search through conventional retail channels.

According to (Crosby and Stephens,1987), navigating through web pages and its contents in an online service context could lead to “information satisfaction” which refers to the consumers’ satisfaction or dissatisfaction with an overall information service encounter. Information quality and user interface quality are believed to affect user information satisfaction (DeLone and McLean, 1992; Wang and Strong, 1996). Other researcher suggested that information presented by online stores should support customer service and product search as well as be helpful and relevant in predicting the quality and utility of a product or service (Park and Kim, 2003))

While the Internet becomes readily accessible, more consumers learn to look for product information from the Internet prior to making purchases. Many early online marketers used price as bait, along with detailed product information, to lure consumers to their sites (Chen and Chang, 2003).

The task of designing adequately predictive information sources is complicated by the heterogeneity of consumer information requirements (Kolesar and Galbraith, 2003). For example, for some consumers, price may be more important than style or perceived quality but for others, price may be less important than qualitative considerations. E-retail sites that fail to satisfy a consumer’s specific search and evaluation preferences risk being abandoned for sites that do satisfy them. (Kolesar and Galbraith, 2003).

According to (Madu, 2002), websites that offer too many choices may not necessarily mean a good thing and could lead to confusion. They also identified a lack of context and lack of organization of information as among six major potential problems in web designs.

2.4.8 Privacy and Security

For over 200 years, J.P.Morgan respecting and protecting individual client privacy has been vital to our business. By sharing our Privacy Principles, we trust that our individual clients will better understand how we keep client information private and secure while using it to provide services and products. Privacy and security is a recognized as the main attribute of an online store providing information to customer to make decisions. There are several method prvided by J.P.Morgan that why the privacy and security is very important in business or web site which is:

• • We protect client information.

 

• • We endeavor to collect, use and maintain client information only for appropriate purposes.

 

• • We share client information with affiliates and with others when we believe it will enhance the services and products we can provide to clients or for legal and routine business reasons.

 

• We provide clients with relevant and appropriate choices regarding the sharing of information with our affiliates and others.

When the consumer using the mobile phone to surfing internet to purchase goods and services such as download MP3, radio, video clip, and etc, they more prefer the awareness of security and data privacy of the mobile shopping web site. If the consumer finish download the MP3 or video clip and then their mobile phone get the virus after they playing the MP3 and video clip. It will affect the consumer intention to shop online through the mobile phone. Privacy and security have been a great concern for Internet shoppers (Grabner-Kraeuter, 2002; James, 1999; Kiely, 1997; Yianakos, 2002). Inadequate infrastructure, lack of trust, and privacy and security concerns often lead to lost sales (Yianakos, 2002; Grabner-Kraeuter, 2002).

Contextual factors like security and privacy have an impact on consumer trust in shopping on the Internet (Lee and Turban, 2001). A high level of security and privacy in the mobile shopping experience has a positive effect on consumer trust, owing to the lowered risk involved with exchanging information. In general, the level of trust, interpersonal as well as institutional, is positively related to consumers’ attitude and intention to shop on the Internet through mobile phone. previous researcher demonstrated that clarifying security and privacy policies leads to the customers developing trust in the bank(Yousafzai et al. (2005). According to previous researcher, providing privacy (and security) disclosures is an effective way for online retailers to develop cooperative relationships with shoppers. (Wang et al. 2004). As perceptions of security and privacy risk decrease, satisfaction with the information service is expected to increase (Ha, 2004; Park and Kim, 2006).

 

CHAPTER 3 METHODOLOGY

3.1 Introductions

In this chapter, methods used to test the variables are through primary and secondary data. The report is focus on the factors that affect the consumer purchase intention towards mobile shopping. The content that will be covered is theoretical frameworks, hypothesis development, data source and collection, sample selection. Then, data measurement scale, data analysis and small conclusion are covered in this chapter. Both primary and secondary data were collected in the present study. Secondary information was collected from existing research and literature. Next, a small conclusion will be developed at the end of this chapter.

3.2 Theoretical Frameworks

ADAPTED BY Yarnold, P. R., & Soltysik, R. C(2005); Walter, S. D., Eliasziw, M., & Donner, A. (1998); Je Ho Cheong and Myeong-Cheol Park(2004).

The above framework depicts the conceptual model of this research. The research attempts to investigate how the 8 independent variable which is mobile skillfulness, ease of use, usefulness, compatibility, enjoyment, price, information content and privacy and security finding are affect the consumer purchase intention towards mobile shopping.

3.2.1 Independent Variables

Independent variables are information used to predict the outcome of a study.

From the research framework, it could be identified that the independent variable

of this study is as below:

1. Mobile skillfulness
2. Ease of use
3. Usefulness
4. Compatibility
5. Enjoyment
6. Price
7. Information content
8. Privacy and security

3.2.2 Dependent Variables

Dependent Variables are the primary interest of the researcher to measure the

effects of the independent variables. Here, the dependent variable of this research

is to study the mobile shopping intention.

3.2.3 Moderating Variables

Moderating variables would have a strong contingent effect on the relationship of

independent variables and dependent variables. The presence of demographic factor such as religion as moderating variable in this study will modify the original relationship between independent and dependent variable, hence affect the consumer purchase intention towards mobile shopping.

3.3 Hypothesis of study

From the discussion of the theoretical framework, nine hypotheses are formulated to test the relationship between each of the nine independent variables and dependent variables. The nine hypotheses guiding this study are as follows:

Age is the part of the demographic background that will affect the consumer purchase intention towards mobile shopping because of the person who are 30 years old and above think that it was wasting the time when using mobile phone for online shopping and the person who are under 30 years old and have experience for online purchasing will think that it was the special and new and then they will try to using the mobile phone for online shopping.

Hypothesis 1

H1 : Age are significantly affect the consumer purchase intention towards mobile shopping

Hypothesis 2

H2 : Gender are significantly affect the consumer purchase intention towards mobile shopping

Mobile skillfulness is a independent variable that refers to the individual’s assessment of his/her ability to perform a specific task well while using the mobile phone to shop online. So mobile skillfulness also will affect the consumer purchase intention towards mobile shopping. Customer will know how to purchase online with the mobile phone if the customer can perform good skill in using mobile phone.

Hypothesis 3

H3: Mobile skillfulness are significantly positively affect consumer purchase intention using mobile shopping.

Ease of use explained and determine by technology acceptance model(TAM) refer the degree to which a customer using the mobile phone to purchase online will be free to effort. So it also an independent variables that will affect the consumer purchase intention using mobile shopping.

Hypotheses 4

H4: Ease of use are significantly positively affect consumer purchase intention using mobile shopping.

Not only the ease of use is key determinant of technology acceptance but also usefulness is determined by the technology acceptance model(TAM).

Hypotheses 5

H5: Usefulness are significantly positively affect consumer purchase intention towards mobile shopping.

Internet compatibility also is an independence variable that affect the consumer purchase intention towards mobile shopping as dependent variables.

Hypotheses 6

H6: Compatibility are significantly positively affect consumer purchase intention using mobile shopping.

After the consumer ability to know how to shop online on internet through the mobile phone, they will feel enjoy, satisfied and have fun searching for products and services while interacting with media provided by the mobile internet.

Hypotheses 7

H7: Enjoyment are significantly positive affect consumer purchase intention using mobile shopping.

The customer using mobile phone to surfing internet via GPRS. It will charge fixed monthly charges, per-minute charges, per-packet charges or mixed for the customer using GPRS through mobile phone. So price perception is an independent variable that will affect the consumer purchase intention towards mobile shopping.

Hypotheses 8

H8: Price are significantly affect consumer purchase intention using mobile shopping

Privacy and security is also most important independent variable that affect the consumer purchase intention towards mobile shopping because customer satisfaction with the greater awareness and data privacy more likely to using the mobile phone to shop online.

Hypotheses 9

H9: Privacy and security are significantly affect consumer purchase intention using mobile shopping

The increase availability of information on the web has the potential to result in more knowledgeable consumers, who are then able to make better quality decisions and will then experience greater satisfaction with any purchases made (Cook and Coupey, 1998). Information content will relate to the purchasing decision as the website’s content is often related to the impression given by the website. Well written contents can be instrumental in selling your products and services to the potential customers as it can influence the size of the target audience the website is trying to reach by helping to improve the search engine rankings (Dominic, 2006).

Hypotheses 10

H10: Information content are significantly positive affect consumer purchase intention using mobile shopping

3.4 Data Source and Collection

In a research, there are usually two main sources of information and data, which are primary data and secondary data (Garino 2000).

3.4.1 Primary Data

The primary data consist of questionnaires.

a) Questionnaires

Questionnaires is a written or printed form used in gathering information on some subject or subjects, consisting of a set of questions to be submitted to one or more persons. The open-ended question which the respondent reply in his or her own words and closed-ended question which requires the respondent to make a selection from a list of question are used in questionnaire design.

The first part of the questionnaire focused on demographic data, such as age, acquires services, gender, education, race and so on, while the second part required what kind of internet services they use to purchase product through mobile phone. The third part will focus on the response of the respondent factors affect their purchase intention towards mobile shopping. A questionnaire is also an important method because it is a paper form which has a list of questions used during survey or interview (Das and Teng, 2001).

3.5 Sample Selection

A total of 150 respondents are selected and made to complete surveys (n=150). Reasons for nonparticipation were either due to don’t using the mobile phone to online shopping or a lack of time to complete the survey.

Because the study is concerned about the, so respondents who usually using mobile phone to shop online are encouraged to be selected in this survey(Jennifer Rowley, 2006). Respondents ranged from 15 to 35 years old may come from different demography such as sex, age and race which include Chinese, Malay, India and other races. Thus, the respondents selected are those who study in secondary school, MMU (Multimedia University), working and so on.

3.6 Data Measurement Scale

The data measurement scale consists of four basic level of measurement which is nominal level of measurement, ordinal level of measurement, interval level of measurement, and ratio level of measurement. The overall design of the questionnaire is mainly around two type level of measurement, which is nominal and Ordinal. The research text book, nominal scale is a scale to identify objects, individuals, events or group, determinate of equality or inequality and are most commonly using in the research. Nominal scales are used in the questions which are in the demographic information section such as female or male, buyer or non buyer. Meanwhile, the research text book, ordinal scales is in addition to identification which provides information about the relative amount of some characteristic possessed by an event or object, and to determine of the greater or lesser. For each question, respondents were asked to circle the response which best described their level of agreement with the statements. Besides that, all items were measured using a five-point Likert-type scale (ranging from 1 =strongly disagree, 2= disagree, 3= neutral , 4= agree to 5 = strongly agree) (Sekaran, 2000)

3.7 Data Analysis

The hypothesized relationships were tested using the multiple regression analysis of SPSS 16.0 for Windows. The SPSS 16.0 is a system which includes t-test, one-way ANOVA, cross tabulations, chi-square, and correlation analysis was conducted to identify differences among user groups. Besides that, SPSS can generate useful tables and graphs such as line charts, pie charts, bar charts and so on for better decision-making (Chong, 2006). With SPSS, it is easy to understand the variable among the effect of e-service quality. The system will change all reported independent and dependent variable to numeric codes.

a) Descriptive Statistics

Statistics used to describe only the observed group or sample from which they were derived; summary statistics such as percent, averages, and measures of variability that are computed on a particular group of individuals(Elsevier, 2004). Besides that, it also Mathematical methods (such as mean, median, standard deviation) that summarize and interpret some of the properties of a set of data (sample) but do not infer the properties of the population from which the sample was drawn. ( Business Dictionary.com).

b) One way ANOVAs

From the research text book, one way ANOVAs is a statistical test that is used to test the null hypothesis of equality of two or more population means. If the test shows significance, the null hypothesis is rejected and conclusion can be made that there is a difference between the population means. In this study, for example, age and gender are tested to examine the main effect of consumer purchase intention towards mobile shopping. If significant value (at confidence level of 95%) is less than 0.05, it shows that the age and the gender are the significantly positive affect the consumer purchase intention towards mobile shopping.

c) Reliability Analysis

Reliability refers to the extent to which a scale produces consistent results, if the measurements are repeated a number of times. The analysis on reliability is called reliability analysis. Reliability Analysis is determined by obtaining the proportion of systematic variation in a scale, which can be done by determining the association between the scores obtained from different administrations of the scale. Thus, if the association in reliability analysis is high, the scale yields consistent results and is therefore reliable. Researcher such as Yarnold, P. R., & Soltysik, R. C. (2005); Walter, S. D., Eliasziw, M., & Donner, A. (1998) has use this method for studies.

d) Correlation Coefficient(Pearson Correlation)

The correlation coefficient, sometimes also called the cross-correlation coefficient, is a quantity that gives the quality of a least squares fitting to the original data(Edwards, 1976). From the Electirc Statistic textbook, it show that correlation is a measure of the relation between two or more variables. The measurement scales used should be at least interval scales, but other correlation coefficients are available to handle other types of data. Correlation coefficients can range from -1.00 to +1.00. The value of -1.00 represents a perfect negative correlation while a value of +1.00 represents a perfect positive correlation. A value of 0.00 represents a lack of correlation.Other than that, from this textbook also show that Pearson correaltion (also known as simple linear correlation) which assumes that the two variables are measured on at least interval scales and it determines the extent to which values of the two variables are “proportional” to each other.

e) Multiple Regression

Multiple regression” is a technique that allows additional factors to enter the analysis separately so that the effect of each can be estimated. It is valuable for quantifying the impact of various simultaneous influences upon a single dependent variable. Further, because of omitted variables bias with simple regression, multiple regression is often essential even when the investigator is only interested in the effects of one of the independent variables (Sykes, A.O, 1995).

 

3.8 Conclusions

This chapter discusses the method used to determine the list of variables most suitable to affection the consumer purchase intention towards mobile shopping when they shop online through mobile phone. The primary data such as survey and questionnaire and secondary data just as journal are used to test the list of variables. Besides that, the system which is called SPSS 16.0 is a system which includes a list of testing tools such as correlation analysis, multiple regression analysis used in distributing the questionnaire and can provide a clear map for more understanding and support the topic.

 

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