Factors Driving Purchase Decision on Online Languages Learning Website Services in Saudi Arabia
In this chapter, the research problem has been put into perspective as existing literature related to the research topic have been reviewed. Precisely, it can be pointed out that the literature review focuses in three key areas that have been found to be important in the study. Thus, the first section of this literature review concentrates on the key concepts of consumer behavior specifically the decision-making element. Nevertheless, in order to have a better comprehension of the online consumer behavior, it is vital to also have a clear perspective of the customers in genera as well as the impacts that the internet has on their consumer behavior. On the other hand, the increased number of internet users has resulted to a new dimension of internet studies in perspective of the consumer and the information system aspect that researches behavior in the online environment.
Focus of the research
As explained by Chiu et al. (2012), the increased competition in the virtual marketplace has made studies investigating any aspect of consumer purchase behavior to be of high importance. This specific research seeks to establish the factors that drive purchasing decisions of online languages learning website services in Saudi Arabia. Nevertheless, even though the findings of this study are going to be considered to be of high importance to online websites offering online learning services in Saudi Arabia, it can also be pointed out that the finding will also be relevant for other online retailers in Saudi Arabia as well as other online businesses operating from different locations worldwide. Thus, apart from the literature on consumer behavior, literature from other disciplines will also be referred to in this literature review. Precisely, literature related to decision making and consumer behavior will be incorporated to offer an ideal and genuine comprehension of what purchasing decision procedure entails. However, it would be impossible to consider the behavioral aspect of the buying process to be completely reviewed without having a proper understanding of the process that the consumers follow when they are about to make a buying decision. In addition to that, past researches that have researched behavior or online consumer have also been reviewed in order to offer understanding on the engagements of the consumers with their environment. Thus, the three underlying dimensions of this literature review comprises of; studies on consumer behavior, studies on decision making, and studies on online consumer behavior.
Consumer behavior studies
Definition of consumer behavior
Even though there are different definitions on what consumer behavior entails, the definition given by Belch and Belch (1998) can be said to be the ideal definition since the scholars have explained consumer behavior as the process as well as the activities that people are involved in at the time they are looking for, selecting, buying, using, and assessing goods and services so that they are able to ensure that their needs and wants are satisfied and at times surpassed. From that definition, it is obvious that consumer behavior involves more than just making a purchase.
As discussed by Engel et al. (1995), consumer behavior was in the past overlooked and only drew serious attention from the scholars in the late 19060s. According to Smith and Rupp (2003) the consumer behavior aspect derived its concept from developed scientific subjects that among others comprises of sociology (study of groups), psychology (study of a person), and economics (study of how one is spending). Nevertheless, with the internet becoming popular, studies on information systems as well as technological advancements have also contributed to the advancement of consumer behavior.
Consumer decision making
Consumer decision making as has been explained by Du Plessis et al. (1991) entails the behavior patterns of the customers that determine and guide the decision process for buying of what one believes will be capable of fulfilling identified needs. For many years, researchers have investigated consumer decision making from different perspectives. As pointed by Engel et al. (1995), from a review of studies that have focused on consumer decision making from different perspectives, there is an agreement between the scholars that consumer decision making involves more than just making the purchase.
The process of purchase decision making
As noted by Su (2007) and Xia and Sudharshan (2002), the consumer purchase decision making involves a process that is driven by information. The reason why that is the case is due to the act that the before the customers can make a decision, they need to first look for information, assess it, and then make a decision. In that perspective, the purchase decision making process is going to differ from one customer to another since the customers will collect and even evaluate information pertaining to their purchase intentions differently (Su 2007).
Modelling the consumer purchase decision making process
Even though it is possible to understand the consumer behavior without necessarily referring to decision making concepts and by only using experimental concepts, it can be pointed out that the decision-making procedure is one of the key aspect in the researches that have focused on consumer behavior. Nevertheless, just as pointed by Livette (2006), models are the ideal approach to expound the consumer decision making process since they can visually depict how various variables as well as situations are connected by using the cause and effect approach. Moreover, a model assesses how the consumer decides between a variety of purchase choices. Thus, it depicts the phases that the customer has to go through in order to finally be at a position where he/she can make a purchase decision (Livette 2006).
Apart from that, just as explained by Caine and Robson (1993), models tend to be make things easy and for that reason, they are ideal in making intricate topics east to understand. Online consumer behavior which is the focus of this study is an intricate research issue since it depends on collecting of information, assessing different types of information, making use of various decision-making approaches, and then making the actual purchase. In that perspective, by using the visual behavioral models, it becomes easy to understand the whole issue better. Apart from that, just as explained by Rickwood and White (2009), having theoretical knowledge and models is vital for organisations and offers them with means to better comprehend their customers and their needs thus increasing the chances of the businesses being successful in the respective markets that they are operating in.
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Types of consumer behavior models
From a review of the various studies that have been carried out in the past and have focused on consumer behavior, it can be explained that there are two major types of models pertaining to consumer behavior. The first type of model comprises of the main aspects of consumer behavior since it depicts the phases that are involved in the decision-making process, various influencing factors and how they are linked to the decision-making process. The other group of model depicts the manner in which consumer behavior is planned and attempts to make prediction of the consumer behavior. Precisely, in this group of model, the theory of planned behavior and the theory of reasoned action can be explained to be the leading theories in this category.
On a different perspective, it can be explained that the second group of models has been mainly discussed in information system literature depicting the reasons why the internet is mainly used as a channel to buy. The first group which seeks to expound the behavior of the customers during the actual decision-making process can be explained to be insufficiently developed when it comes to online purchasing. Thus, the knowledge on phases of consumer decision making process as well as the chronological order are restricted thus making it complex to have a clear understand of the online customers decision making process.
Since consumers cannot be same and thus have to be behave in a different manner, models of purchase decision making behavior are applied differently by various individuals. In the succeeding paragraphs, the differences in purchase behavior are explained as discussed in various literatures.
One of the differences in the purchase behavior entails differences in consumer search. As explained by Kaas (1982) and Moore and Lehmann (1980), the knowledge that the consumers have regarding the market as well as the regularity of purchase determine the manner in which the customers conduct the search. For example, in the event that the customers are not familiar with the product, Kaas (1982) has explained that the customers are going to get to the concept establishment phase where they get to acquaint themselves with the product as they seek to know the features of the product and what they need to look for when seeking for a product. After that, the customer is then going to move to brand information as he/she seeks to find out the best brand for the product that the customer is planning to buy. However, for a customer who buys the product at infrequent basis, the customer will commence the search process at the brand information phase. Precisely, in the brand information phase, the customers are going to seek information related to different brands and will thereafter proceed to the final phase of situational information which involves gathering information that is specific to a certain product (Kaas 1982). In view of online buying context, Sporoule and Archer (2000) has noted that the same search process as discussed by Kaas (1982) is applied.
In view of differences in purchase behavior, it can be explained that according to Kotler (2003), consumer behavior can be grouped into four different groups that are based on the buyer’s participation and the variations in brands, the value or product or service, and regularity of purchase. From that perspective, it can thus be explained that the consumer as well as the situation of the purchase impact the purchase behavior. A summary of various types of purchase behavior as derived from Kotler (2003) and Battman et al. (1991) has been featured in table 1.
Decision making science
In this part of the literature review, existing literature on decision science will be reviewed even though the main focus is going to be on the concepts that might be adopted in the consumer decision making behavior.
Decision making procedures are a critical element of the decision science literature. As discussed by different scholars, there are different types of decisions that can be made. One of the types of decisions that can be made comprises of programmed and non-programmed decisions (Simon 1960). According to Simon (1960), the programmed decisions tends to be well structured and those making these decisions have clear procedures that they follow when they are making the decision. On the other hand, non-programmed decisions, comprises of decisions that are made without following any criteria.
In situations where the decision being made is not quite complex, the decision maker might opt to use the adaptive decision-making approach where a decision-making approach that has been used in the past would be adopted and used in this specific situation. According to Foxall (1993), the purchase decision making process can be classified to entail adaptive decision-making approach since when customers are making a purchase decision they have to consider some of the past purchase decision making process even if what they are buying at a given time is different to what they purchased in the past. Thus, through the use of adaptive decision making process, the different customers tend to use different processes when it comes to purchase decision making.
On a different note, Keeney (1982) has discussed that when making decision, complexity is unavoidable and it tend to be part of the problem rather than been part of the solution as many expects. Nevertheless, Keeney (1982) has noted that the degree to which decisions are going to be complex differs since there are various factors that are going to determine whether the decision making is going to be complex or not. Among others, some of these issues comprises of; the available options, the magnitude of the decision that is being made, risks involved in the decision that is being made, and information available that could help in aiding the decision-making process.
In view of online purchase decision making, it can be explained that the fact that the internet is a highly intricate environment makes the purchase decision making process a complicated issue. The reason why that is the case is due to the fact that making the purchase decision in such a situation involves various types of inter related issues. However, through modelling, it is possible to simplify the decision-making process. As has been explained by Papamichail and Robertson (2003), the process modelling could be important in capturing the key stages of a process, minimizing the related difficulty, and making it easy to smoothen the identification of process constructs.
Online customers behaviors
The past discussions have provided an overview of consumer behavior with emphasis being on consumer decision making processes when referring to existing literature on consumer behavior as well as decision science. In this part of the literature review, the focus is specifically on online consumer behavior since. The reason why focus is on online consumer behavior is due to the fact that there is a high chance that online consumer behavior is totally different to traditional consumer behavior. On another perspective, it can be pointed out that there is a shortage on literature discussing online customer behavior and it is for that reason that this specific research was carried out with the intention of adding to the existing literature on online customer purchase behavior. Moreover, it is also important to explain that any literature discussing online consumer behavior is going to be of great importance in the 21st Century since with the number of internet users being on the increase constantly and many businesses now going virtual, the businesses want to have a clear understanding of how they can influence the online customers buying behavior so that the customers ends up buying the products or services that they are offering online.
Online customers and opportunities offered for business embracing e-business strategies
In order for any business to be able to convince customers to buy the products or services that it offers online at the expense of other online competitors, the online business needs to have a better understanding of the online customers. According to Dennis et al. (2009), online businesses have faced challenges when it comes to fulfilling the needs of the customers and using making the most of the online business environment. Moreover, Dennis et al. (2009) has also pointed out there is less understanding when it comes to the manner in which customer make purchase decisions online as well as how they search for information in the online environment. According to Koufaris (2003), online customers are different to customers buying from a physical or brick and mortar store since apart from being online customers, they are also internet users who undertake a purchase linked task to serve their purchase needs. Moreover, they need engagement with the internet while at the same time directing the purchase process how they want it to be. Their actions are impacted by the general purchase linked aspects as well as the manner in which they engage with the internet. From that perspective, it is thus important that the needs and concerns of online customers are understood since such an understanding could then be capitalized upon in order to ensure that the online customers have a good online shopping experience that satisfies them and in the process, convert them to loyal customers (Agarwal and Lucas 2011).
Features of the internet
The manner in which those buying through the internet behave has for some time being the subject of interest to scholars. As explained by Moon (2004), the internet has become a dynamic element that impacts the buying behavior due to the fact that among others, it makes it easy to access loads of information that could be used in the decision making process, it makes it possible for customers to have access to the products or services without having to physically visit the brick and mortar store, and makes it easy for customers to get feedback from fellow customers who have used the same product in the past. Thus, it can be noted that the internet has the capability to enhance the customer experience as it offers convivence, customized products and services, and on some cases the opportunity for low prices (Moon 2004). Apart from that, just as discussed by Jarett (2008), the web 2.0 characteristics of the internet have made it a vibrant platform as the business can be able to interact with the customers and ensure that the customers feel that their views and opinions are highly valued thus increases the chances of customer satisfaction. All these aspects of the internet will have an impact on the customer purchase decision as well as the customer satisfaction.
Nevertheless, as explained by Lee (2002), there are also some concerns that are raised by the customers who are contemplating to make their purchases online. For example, the fact that there is no face-to-face contacts while there is also the risk of an online shopper ending up being a victim of cybercrimes means that some customers who might be contemplating making an online purchase might be hesitant to make the purchases. As explained by Moe and Fader (2002), the various risks involved in online shopping tend to be the main hindrances for many customers to make online purchases. Apart from that, Moe and Fader (2002) expounded that the fact that a consumer does not need to pay anything access an online store also delays the purchase decision making process since the customer can frequent the online store as many times as need and even postpone making the purchases a number of times without there being any inconveniences while that might not be the case if one was to physically visit a brick and mortar store.
How the internet influences the purchase decision making process
Even though there are some people who might argue that the online purchase process is similar to the traditional purchase process, the reality is that the two are totally different to each other since as pointed out by McGaughey and Mason (1998), the internet impacts all the phases of the buying process that are consumer goes through. For example, looking for information, looking for various options, and even making the purchases and the payments are all different in an online set up. Thus, just as highlighted by Moon (2004), the internet has revolutionized consumer behavior since it offers the consumers convenience that they are not offered during traditional buying. Therefore, the online buying environment could have a major influence in how the online customers go about making their purchase decisions (Choudhury and Karahanna, 2008).
Mick et al. (2004) and Bakos (1997) agree that information overload is one of the major issues that the online customers face since they need to make a decision after having access to a lot of information where they might not be in a position to evaluate some of the information. Normally, to evaluate the loads of information available online, Haubl and Trifts (2000) explained that the customers use two phase processes. The first phase involves reviewing the products or services available online generally and then select a few choices that are perceived to be ideal. After that, the few choices are looked at in an in-depth manner that is determined by the purchase criteria resulting to a choice on the product or service to be purchased being made.
Moreover, Wand and Benbasat (2008), various supporting aspects made possible by the internet also impacts the purchase decisions. For example, customers can now use price comparison features, product comparison aspects, and even reviews by other users to make the purchase decisions. Specifically, these features are mainly used in situations where the buyer is not well conversant with the features of the product or services and is thus using these features to become more acquainted with the product or services being offered.
From the above discussions, it is obvious that the online buying process is going to be different to the traditional buying process. Apart from that, as explained by Court et al. (2009), studies carried out have also shown that online customers are different to traditional customers since they are more informed and as a result, they end up being more demanding and having high bargaining power.
Aspects of online purchase decision making process
As has been discussed, the online customer behavior cannot be similar to the purchasing behavior on a traditional customer that has been discussed and research upon in great detail by scholars in the past. Specifically, the online purchase decision making process can be explained to entail to some degree ad-hoc, formal and informal processes, and it is different from one customer to another. Indeed, there is no laid-out process to be followed and the process is unstructured with the online retailer and the online buyer both having an impact in the purchase decision to be made.
The aim of this study is to investigate the factors driving purchasing decisions of online languages learning website services in Saudi Arabia. However, there have been no studies focusing on the same research topic and for that reason, the literature review section has mainly drawn on existing literature that have discussed online purchase behavior from different perspective. From the literature review, it is obvious that once online customers have accessed the information on the services or products offered, there are three main factors that drive the purchase decisions. These factors comprise of brand name, price and product variety. From that perspective, the primary research to be carried out will be carried out with the objective of testing the following hypothesis:
- H1: The brand name of the service providers impacts the purchasing decisions of online languages learning website services in Saudi Arabia
- H2: The price that online languages learning website services in Saudi Arabia impacts the purchase decisions of the customers
- H3: The variety of the services offered by online languages learning website services in Saudi Arabia
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