Consumer perceptions of shopping channel attributes and risk factors influencing apparel purchases

200 Pages·2015·1.79 MB·English

by  N Cunningham

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How to cite this thesis
Surname, Initial(s). (2012) Title of the thesis or dissertation. PhD. (Chemistry)/ M.Sc. (Physics)/
M.A. (Philosophy)/M.Com. (Finance) etc. [Unpublished]: University of Johannesburg. Retrieved
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CONSUMER PERCEPTIONS OF SHOPPING CHANNEL ATTRIBUTES AND RISK
FACTORS INFLUENCING APPAREL PURCHASES

NICOLE CUNNINGHAM
200902158

Dissertation
submitted in fulfilment of the requirements
for the degree
MCom
in Marketing Management
in the
Faculty of Management
at the
University of Johannesburg

Supervisor: Prof CF De Meyer-Heydenrych

UNIVERSITY OF JOHANNESBURG

The financial assistance of the National Research Foundation (NRF) towards this
research is hereby acknowledged. Opinions expressed and conclusions arrived at,
are those of the author and are not necessarily to be attributes to the NRF.
DECLARATION

I certify that the dissertation submitted by me for the degree Master’s of Commerce
(Marketing Management) at the University of Johannesburg is my independent work and has
not been submitted by me for a degree at another university.

MS NICOLE CUNNINGHAM

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ACKNOWLEDGEMENTS
A sincere thank you to all the people who contributed to the completion of this study. My
particular gratitude is extended to the following:
The National Research Foundation (NRF) for awarding me a Scarce Skills Master’s
Scholarship which made this study possible.
Prof Christine De Meyer-Heydenrych, thank you so much for all the time you spent on my
MCom, for your guidance and support over the past year and a half and for always allowing
me to pop into your office to ask ‘one quick question’.
My mom, dad, sister and boyfriend, thank you for all your love, patience and encouragement
during this journey. I must extend a special thank you to my mom and dad for the
opportunities they gave me which made this degree possible.
To everyone at the department, thank you for all your encouragement during this process. A
special thank you to Mrs Schmidt who continuously made sure I was progressing.

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ABSTRACT

The South African apparel industry is growing tremendously with a sales value of R129.9
billion expected by 2019 (Marketline, 2015). This is due to the growth in the middle class, the
increase in disposable income, and the fact that the South African economy is focused on
technology, finance, and e-commerce (online shopping) (Marketline, 2013:2). Consumers
are being exposed to various shopping channel options, both offline and online, which has
been found to influence their purchase intention (Voinea & Filip, 2011:17). Retailers should
therefore aim to understand how the offline and online shopping channels they offer are
affecting consumers, and, in particular, they need to understand consumers’ reasons and
motivation for selecting one channel over another. The literature on the subject has found
that there are two main factors influencing shopping channel choice: shopping channel
attributes – cost, time, convenience, and customer service – and perceived risk factors –
delivery risk, product risk, and security risk (Al-Hawari & Mouakket, 2012:641; Lin & Sun,
2009:461; Martin & Camarero, 2008:629; Huang & Oppewal, 2006:347; van Dijk, Laing &
Minocha, 2005:1). Thus, by understanding the two sets of factors influencing shopping
channel choice, retailers will understand why consumers select one channel rather than
another – which will allow retailers to design appropriate shopping channels for their goods.
This will improve their efficiency and engagement as they will be offering consumers
shopping channels that appeal to them.

This study is aimed at determining how the perceptions consumers have about shopping
channel attributes and perceived risks influence purchase intention for offline and online
shopping. The study is descriptive in nature, with elements of quantitative research in the
form of administered questionnaires which were used to collect the data. The target
population of this study was consumers who purchased apparel using either offline or online
shopping channels, and the sampling units were individual consumers who purchased
apparel in Gauteng, Johannesburg, either offline or online in the six months prior to
participating in the survey. The sampling size was 450, but there were 397 questionnaires
useable for the statistical tests. Statistical tests used included: factor analysis (exploratory
and confirmatory) and multiple regression analysis. The statistical analysis revealed that
customer service and delivery risk influence offline purchase intention, while convenience
and delivery risk influence online purchase intention. The significance of the study is two-
fold: firstly, its theoretical significance is that it is a study that investigates both offline and
online shopping side by side. In doing this it adds to the scant literature available on the
South African apparel industry. Secondly, the practical significance of the study is that it
reveals which shopping channel attributes and perceived risk factors retailers should take
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into consideration to improve their efficiency and engagement with consumers: the study
offers information that retailers can use to introduce online shopping channels or to modify
their online shopping presence. Practically, in order to better the customer service
consumers receive in offline shopping retailers should ensure that their customer service is
satisfactory by training and motivating employees. Secondly, when assessing their online
shopping channels, retailers should ensure the highest level of convenience by making sure
that their websites are mobile-friendly and user-friendly. Doing this would allow the majority
of South African consumers (who mostly use mobile phones to access the Internet) the
ability to utilize their online shopping channels. Overall, this study will assist marketers in
creating feasible marketing strategies through the identification and understanding of the
factors influencing consumers’ choice of shopping channels.

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LIST OF KEY TERMS AND DEFINITIONS

Throughout this study, key terms will be used:
 Perceptions: Kotler and Armstrong (2010:159) refer to perception as the manner in
which people select, organize, and interpret information. Furthermore, the perceptions
consumers have are determined by experience and culture, which change over time.

 Online shopping: Javadi, Dolatabadi, Nourbakhsh, Poursaeedi and Asadollahi
(2012:81) state that online shopping is a process where consumers purchase products
and services using the Internet, as opposed to physically going to a store. South African
examples of online shopping include Zando and Spree – both retailers which use only
online channels.

 Offline shopping: Levin, Levin and Heath (2003:85) state that offline shopping refers to
purchasing products and services without using the Internet. South African examples
would include YDE and Stuttafords – both retailers that do not offer an online shopping
component.

 Apparel: Spencer (2013) refers to apparel as leather goods, footwear, clothes and
textiles – including luxury and basic items for women, men, and children.

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TABLE OF CONTENTS

DECLARATION ...................................................................................................... i

ACKNOWLEDGEMENTS ..................................................................................... ii

ABSTRACT ............................................................................................................. iii

LIST OF KEY TERMS AND DEFINITIONS ....................................................... v

LIST OF TABLES .................................................................................................. xv

LIST OF FIGURES ................................................................................................ xvii

CHAPTER 1: INTRODUCTION TO THE STUDY

1.1 INTRODUCTION .................................................................................................... 1

1.2 BACKROUND TO THE STUDY .......................................................................... 1

1.3 LITERATURE REVIEW ......................................................................................... 2

1.3.1 Shopping channels ................................................................................................ 3

1.3.1.1 Offline shopping ...................................................................................................... 3

1.3.1.2 Online shopping ...................................................................................................... 5

1.3.2 Factors influencing the choice of shopping channel ......................................... 7

1.3.2.1 Shopping channel attributes ................................................................................. 7

1.3.2.2 Perceived risk factors ............................................................................................. 8

1.3.3 The apparel Industry .............................................................................................. 9

1.4 PROBLEM STATEMENT ..................................................................................... 10

1.5 OBJECTIVES.......................................................................................................... 12

1.5.1 Primary objective .................................................................................................... 12

1.5.2 Secondary objectives ............................................................................................. 12

1.6 HYPOTHESES........................................................................................................ 13

1.7 RESEARCH METHODOLOGY ............................................................................ 15

1.7.1 Research design ..................................................................................................... 15

1.7.2 Population and sample .......................................................................................... 16
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1.7.3 Measuring instrument ........................................................................................... 17

1.8 DATA ANALYSIS .................................................................................................. 18

1.9 CHAPTER LAYOUT .............................................................................................. 19

1.10 CONCLUSION ........................................................................................................ 20

CHAPTER 2: THE SOUTH AFRICAN APPAREL INDUSTRY

2.1 INTRODUCTION .................................................................................................... 22

2.2 THE RETAIL SECTOR .......................................................................................... 22

2.2.1 The global retail sector .......................................................................................... 22

2.2.2 The South African retail sector ............................................................................. 23

2.3 THE APPAREL INDUSTRY ................................................................................. 24

2.3.1 Textiles ..................................................................................................................... 24

2.3.2 Apparel ..................................................................................................................... 25

2.3.3 Footwear .................................................................................................................. 26

2.3.4 Leather goods ......................................................................................................... 26

2.4 THE MAJOR APPAREL RETAILERS IN THE SOUTH AFRICAN RETAIL
INDUSTRY .............................................................................................................. 27

2.4.1 Edcon ....................................................................................................................... 28

2.4.2 Mr Price Group ........................................................................................................ 28

2.4.3 Foschini Group ........................................................................................................ 29

2.4.4 Woolworths Holdings ............................................................................................. 29

2.4.5 Truworths International .......................................................................................... 30

2.5 THE SOUTH AFRICAN APPAREL INDUSTRY IN COMPARISON TO
THE GLOBAL APPAREL INDUSTRY ............................................................... 30

2.6 TRENDS IN THE APPAREL INDUSTRY ........................................................... 31

2.6.1 Sustained shopping ................................................................................................ 31

2.6.2 Increases in costs ................................................................................................... 31

2.6.2.1 Strike costs .............................................................................................................. 31

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2.6.2.2 Manufacturing costs ............................................................................................... 32

2.6.2.3 Wages ...................................................................................................................... 32

2.6.2.4 Worker compensation ............................................................................................ 33

2.6.3 The influences of technology ................................................................................ 33

2.7 CONCLUSION ........................................................................................................ 34

CHAPTER 3: CONSUMER PERCEPTIONS, SHOPPING CHANNEL ATTRIBUTES,
PERCEIVED RISK FACTORS AND GENERAL PURCHASE INTENTION

3.1 INTRODUCTION .................................................................................................... 35

3.2 CONSUMER PERCEPTIONS .............................................................................. 35

3.2.1 Defining consumer perceptions ............................................................................ 36

3.3 FACTORS INFLUENCING CONSUMER PERCEPTIONS ............................. 36

3.3.1 Type of shopping channel ..................................................................................... 36

3.3.2 Word-of-mouth ........................................................................................................ 37

3.3.3 Trust .......................................................................................................................... 37

3.3.4 Subjective norms .................................................................................................... 38

3.3.5 Consumer past perceptions .................................................................................. 38

3.4 SHOPPING CHANNEL ATTRIBUTES ............................................................... 39

3.4.1 Cost ........................................................................................................................... 39

3.4.2 Time .......................................................................................................................... 39

3.4.3 Convenience............................................................................................................ 40

3.4.4 Customer service .................................................................................................... 40

3.5 FACTORS INFLUENCING SHOPPING CHANNEL ATTRIBUTES .............. 41

3.5.1 Product category ..................................................................................................... 41

3.5.2 Retailer’s reputation ............................................................................................... 43

3.5.3 Purchase frequency ............................................................................................... 44

3.6 PERCEIVED RISK FACTORS ............................................................................. 46

3.6.1 Delivery risk ............................................................................................................. 47
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