FACTORS INFLUENCING CONSUMER PURCHASE DECISION ON THE RUSSIAN E-COMMERCE MARKET: THE CASE OF HOUSEHOLD GOODS
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Making 9
1.1 Consumer decision-making process 9
1.2 Modern research in e-commerce 11
1.3 Global and Russian E-commerce Trends: Market overview 21
1.4 Further research directions 26
1.5 Conclusions 28
Chapter 2. Research design development 30
2.1 Factor overview 30
2.2 Hypothesis development 36
2.3 Conceptual model and methodology 39
2.4 Questionnaire development 42
2.5 Conclusions 44
Chapter 3. Data analysis 45
3.1 Sample 45
3.2 Descriptive analysis 49
3.3 Exploratory factor analysis 54
3.4 Confirmatory factor analysis 57
3.5 Conclusions 59
Discussion and practical implication 61
Limitations and further research 64
Conclusions 65
References 67
APPENDICES 71
1.1 Consumer decision-making process 9
1.2 Modern research in e-commerce 11
1.3 Global and Russian E-commerce Trends: Market overview 21
1.4 Further research directions 26
1.5 Conclusions 28
Chapter 2. Research design development 30
2.1 Factor overview 30
2.2 Hypothesis development 36
2.3 Conceptual model and methodology 39
2.4 Questionnaire development 42
2.5 Conclusions 44
Chapter 3. Data analysis 45
3.1 Sample 45
3.2 Descriptive analysis 49
3.3 Exploratory factor analysis 54
3.4 Confirmatory factor analysis 57
3.5 Conclusions 59
Discussion and practical implication 61
Limitations and further research 64
Conclusions 65
References 67
APPENDICES 71
Research object: Russian customers above 18 years old, who buys household goods online
Research subject: factors that affect consumer purchase decision of household goods
Research goal: to identify factors that influence consumer purchase decision on the Russian e-commerce market for household goods. For achieving this goal several tasks were formulated:
1. Conduct a literature review of most recent articles and theory regarding consumer decision making in order to identify factors that potentially influence consumer decision¬making in the purchase of household goods
2. Provide market overview of Global and Russian e-commerce trends ito provide comprehensive understanding of the chosen area and key players on the Global and Russian e-commerce market
3. Develop research design and and research model of the factors
4. Collect data
5. Analyze the collected data in order to identify which factors influence consumer purchase decision on the Russian e-commerce market for household goods.
6. Provide discussion of results and write practical implications
7. Identify future research directions and research limitations
The Russian e-commerce market is growing rapidly. On the Global arena, Russia is holding the 9th place of world key markets in 2022 with internet penetration of 88%, volume of B2C online trade 84 billion dollars and 3.9% of share of online commerce in GDP (Data Insight, 2022).
In 2022 Russian customers made 2.8 billion orders in 2022 (64% more than in 2021). Moreover, in 2022, the e-commerce market grew by 1.55 trillion rubles. Half of this growth came from Wildberries, and in total the three largest marketplaces (Wildberries, Yandex Market and Ozone) provided more than 80% of the total market growth. Over the past 10 years, the market has developed very much: if in 2012, online sales of Russian buyers amounted to 320 billion rubles, then in 2022 they amounted to 5,660 billion rubles. In addition, the share of e-Commerce continues to grow: in 2022 it amounted to 14% of the retail market and 29% of the non-food retail market. In comparison, in 2017 it was 4% and 10%, respectively (Data Insight, 2022).
Research gap: there is a lack of research which explores factors that influence consumer purchase decision on the Russian e-commerce market for household goods.
Research subject: factors that affect consumer purchase decision of household goods
Research goal: to identify factors that influence consumer purchase decision on the Russian e-commerce market for household goods. For achieving this goal several tasks were formulated:
1. Conduct a literature review of most recent articles and theory regarding consumer decision making in order to identify factors that potentially influence consumer decision¬making in the purchase of household goods
2. Provide market overview of Global and Russian e-commerce trends ito provide comprehensive understanding of the chosen area and key players on the Global and Russian e-commerce market
3. Develop research design and and research model of the factors
4. Collect data
5. Analyze the collected data in order to identify which factors influence consumer purchase decision on the Russian e-commerce market for household goods.
6. Provide discussion of results and write practical implications
7. Identify future research directions and research limitations
The Russian e-commerce market is growing rapidly. On the Global arena, Russia is holding the 9th place of world key markets in 2022 with internet penetration of 88%, volume of B2C online trade 84 billion dollars and 3.9% of share of online commerce in GDP (Data Insight, 2022).
In 2022 Russian customers made 2.8 billion orders in 2022 (64% more than in 2021). Moreover, in 2022, the e-commerce market grew by 1.55 trillion rubles. Half of this growth came from Wildberries, and in total the three largest marketplaces (Wildberries, Yandex Market and Ozone) provided more than 80% of the total market growth. Over the past 10 years, the market has developed very much: if in 2012, online sales of Russian buyers amounted to 320 billion rubles, then in 2022 they amounted to 5,660 billion rubles. In addition, the share of e-Commerce continues to grow: in 2022 it amounted to 14% of the retail market and 29% of the non-food retail market. In comparison, in 2017 it was 4% and 10%, respectively (Data Insight, 2022).
Research gap: there is a lack of research which explores factors that influence consumer purchase decision on the Russian e-commerce market for household goods.
The aim of research was to identify factors that influence consumer purchase decision on the Russian e-commerce market for household goods. Achieved tasks:
1. Conduct a literature review of most recent articles and theory regarding consumer decision making in order to identify factors that potentially influence consumer decision-making in the purchase of household goods
During the literature review, theory on consumer decision-making process and consumer decision-making model by Engel et al. (1990) were taken as the basis for purchase decision factor. Moreover, were explored latest articles regarding consumer purchase decision and identified next factors from the literature:
- Reviews: quality of review, amount of visual information
- Technology: livestreaming and AR
- Product description: quality of description and mentioning recyclable and eco-friendly materials
Also an established research gap was established here - there is a lack of research which explores factors that influence consumer purchase decision on the Russian e-commerce market for household goods.
2. Provide market overview of Global and Russian e-commerce trends ito provide comprehensive understanding of the chosen area and key players on the Global and Russian e-commerce market
During market overview was established several insights about Russian e-commerce market. In in 2022, the e-commerce market grew by 1.55 trillion rubles. Half of this growth came from Wildberries, and in total the three largest marketplaces (Wildberries, Yandex Market and Ozone) provided more than 80% of the total market growth. Over the past 10 years, the market has developed very much: if in 2012, online sales of Russian buyers amounted to 320 billion rubles, then in 2022 they amounted to 5,660 billion rubles. In addition, the share of e-Commerce continues to grow: in 2022 it amounted to 14% of the retail market and 29% of the non-food retail market.
3. Develop research design and and research model of the factors
During research design development 8 hypotheses were formulated and developed research model. To test this model, SEM analysis was chosen.
4. Collect data
For collection primary data was developed a questionnaire, which was sent out and has collected 333 responses.
5. Analyze the collected data in order to identify which factors influence consumer purchase decision on the Russian e-commerce market for household goods.
The average age of the sample is 35 years old. The gender distribution represents the reality, where women buy household goods more than men: 64% of women in the sample vs 34% of men. Most of the respondents are from Saint Petersburg. 57% of respondents have either average or slightly above the average income. 85% of respondents have higher education. 47% of respondents are married and 40% are single. Top 3 popular platforms to buy household goods among respondents: Ozon, Wildberries, Yandex Market. Only 21% (71 respondents) work remotely. Therefore, there's no possibility to test hypothesis 7 and 8.During the EFA analysis it was established that all data is reliable. During CFA analysis was established a good reliability and goodness of fit of data. During testing the hypothesis was established that quality of review, amount of visual information and livestreaming don't have influence on purchase decision. While AR, mentioning recyclable materials and quality of product description factors have a positive significant influence on purchase decision.
6. Provide discussion of results and write practical implications
Quality of review, amount of visual information and livestreaming don't have an influence on purchase decision. While AR, mentioning recyclable materials and quality of product description factors have a positive significant influence on purchase decision. The practical implications divided into 2 categories: for business (marketplaces or a business) and for sellers (individual entrepreneurs that sell household goods on market places).
7. Identify future research directions and research limitations
The limitations for research are: focus mostly on Saint Petersburg, area household goods, average age of respondents is 35 years.
Future research directions are: investigate the influence of these factors in other regions of Russia, explore the moderation effect of remote work on these factors, investigate the intermediate role of quality of reviews and amount of visual information on purchase decision of household goods, investigating the quality and context of visual information, longitude research for livestreaming, explore the influence of livestreaming on purchase decision a couple years later, exploring ways to increase consumer engagement with livestreaming, explore the impact of different types of reviews.
1. Conduct a literature review of most recent articles and theory regarding consumer decision making in order to identify factors that potentially influence consumer decision-making in the purchase of household goods
During the literature review, theory on consumer decision-making process and consumer decision-making model by Engel et al. (1990) were taken as the basis for purchase decision factor. Moreover, were explored latest articles regarding consumer purchase decision and identified next factors from the literature:
- Reviews: quality of review, amount of visual information
- Technology: livestreaming and AR
- Product description: quality of description and mentioning recyclable and eco-friendly materials
Also an established research gap was established here - there is a lack of research which explores factors that influence consumer purchase decision on the Russian e-commerce market for household goods.
2. Provide market overview of Global and Russian e-commerce trends ito provide comprehensive understanding of the chosen area and key players on the Global and Russian e-commerce market
During market overview was established several insights about Russian e-commerce market. In in 2022, the e-commerce market grew by 1.55 trillion rubles. Half of this growth came from Wildberries, and in total the three largest marketplaces (Wildberries, Yandex Market and Ozone) provided more than 80% of the total market growth. Over the past 10 years, the market has developed very much: if in 2012, online sales of Russian buyers amounted to 320 billion rubles, then in 2022 they amounted to 5,660 billion rubles. In addition, the share of e-Commerce continues to grow: in 2022 it amounted to 14% of the retail market and 29% of the non-food retail market.
3. Develop research design and and research model of the factors
During research design development 8 hypotheses were formulated and developed research model. To test this model, SEM analysis was chosen.
4. Collect data
For collection primary data was developed a questionnaire, which was sent out and has collected 333 responses.
5. Analyze the collected data in order to identify which factors influence consumer purchase decision on the Russian e-commerce market for household goods.
The average age of the sample is 35 years old. The gender distribution represents the reality, where women buy household goods more than men: 64% of women in the sample vs 34% of men. Most of the respondents are from Saint Petersburg. 57% of respondents have either average or slightly above the average income. 85% of respondents have higher education. 47% of respondents are married and 40% are single. Top 3 popular platforms to buy household goods among respondents: Ozon, Wildberries, Yandex Market. Only 21% (71 respondents) work remotely. Therefore, there's no possibility to test hypothesis 7 and 8.During the EFA analysis it was established that all data is reliable. During CFA analysis was established a good reliability and goodness of fit of data. During testing the hypothesis was established that quality of review, amount of visual information and livestreaming don't have influence on purchase decision. While AR, mentioning recyclable materials and quality of product description factors have a positive significant influence on purchase decision.
6. Provide discussion of results and write practical implications
Quality of review, amount of visual information and livestreaming don't have an influence on purchase decision. While AR, mentioning recyclable materials and quality of product description factors have a positive significant influence on purchase decision. The practical implications divided into 2 categories: for business (marketplaces or a business) and for sellers (individual entrepreneurs that sell household goods on market places).
7. Identify future research directions and research limitations
The limitations for research are: focus mostly on Saint Petersburg, area household goods, average age of respondents is 35 years.
Future research directions are: investigate the influence of these factors in other regions of Russia, explore the moderation effect of remote work on these factors, investigate the intermediate role of quality of reviews and amount of visual information on purchase decision of household goods, investigating the quality and context of visual information, longitude research for livestreaming, explore the influence of livestreaming on purchase decision a couple years later, exploring ways to increase consumer engagement with livestreaming, explore the impact of different types of reviews.
Stages of Hierarchy of Effects Model by Lavidge and Steiner [Source: Lavidge, R. J., & Steiner, G. A.
