THE ROLE OF THE INTERNET IN THE PROCESS

THE ROLE OF THE INTERNET IN THE PROCESS OF PURCHASING PASSENGER CARS IN BOSNIA AND HERZEGOVINA Kenan MAHMUTOVIĆ University of Bihać, Faculty of Economics Abstract Passenger cars belong to the group of expensive products that are rarely bought, so the consumers undertake complex buying behavior in the process of purchasing Making such purchasing decisions requires a great amount of information Consumers shopping for new and used passenger cars can quickly find a wealth of information and tools on auto manufacturer, dealer and third-party websites The Web gives consumers the power to compare, configure, calculate and communicate: the shopping experience is enhanced In addition the Internet has created a new communication model „many-to-many“, where all participants can not only directly communicate with each other, but also publish content on the Web User generated content (UGC), like online reviews or forum and blog posts, has become important in the „Car-Buying Game“, making social media more influential Recent surveys conducted in developing markets (Brazil, Russia, India and China), and mature markets (France, Germany, UK and USA) show that for all vehicle buyers the Internet is most used, most helpful and most influential information channel In this paper, we examine the case of Bosnia and Herzegovina, to determine the role of the Internet in the process of purchasing passenger cars The research was conducted using online survey (CAWI) on two classified web sites in Bosnia and Herzegovina (Automarket.ba and Nekretnine365.com) Keywords: Internet, Bosnia and Herzegovina, buying behavior, passenger cars Introduction To succeed in the competitive marketplace, companies research consumer behavior and use the results and recommendations of others’ research to improve business performance through customer-focused strategies Marketers who understand their customers can create better products and services, promote their products and services more effectively, and develop marketing plans and strategies that foster sustainable competitive advantages Their goal is to understand the general dynamics of consumer behavior that remain constant regardless of fads or trends People make hundreds of decisions each day Some of these decisions are trivial, such as clicking a Web site for the daily news, and others are complex, like deciding on new car buying Thus, consumer decision making is a multifaceted process that ranges from automatic to highly structured problem solving Consumer decision making considers two separate factors: processing effort and involvement (Assael, 1998) The first factor, processing effort, represents a continuum from automatic to systematic processing We could think of processing effort as primarily cognitive or thinkingoriented and involvement as more affective or feeling-oriented Figure depicts this two1237 dimensional model of consumer decision making, with its quadrants of brand laziness, brand loyalty, variety seeking, and problem solving Figure 1: Product examples by decision type Information Processing Involvement Low Low High Brand Laziness butter, ammonia, salt, flout cheese, toothpaste* Brand Loyalty jeans, athletic shoes, TV programs cigarettes, magazines, toothpaste* Variety Seeking High beer, candy, sport drinks, chewing gum, breakfast cereal, toothpaste* Problem Solving automobiles, appliances, furniture, airlines, consumer electronics, toothpaste Source: Adapted from Assael, H (1998) Consumer Behavior and Marketing Action Cincinnati, OH: South-Western Publishing Problem solving is type of decision that combines high involvement with high levels of information processing Decision making of this type typically involves unfamiliar, expensive products that are purchased infrequently Consumers who shop for automobiles are example of buyers who exhibit problem solving Because their emotional involvement is high and the search task is new, consumers try to collect as much information as possible and carefully evaluate each brand At this level of decision making, consumers need extensive information to understand the various brand attributes as well as the relative performance of these attributes for each brand According to Kotler et al (2005), and Engel et al (1995) buyer pass through five stages to reach buying decision: need recognition, information search, evaluation of alternatives, purchase decision and post-purchase behavior Buyer behavior is the result of the complex interplay of cultural, social, personal and psychological factors Similar, Turban et al (2002, p.88) state that purchase decision process consists of three steps: pre-purchase, actual purchase, and post-purchase step, which are further divided into six behavioral stages: need identification, consideration set development, information search and evaluation of alternatives, choice decision, configuration/personalization, upgrade/replacement The first stage, need recognition, occurs when a customer experiences a difference between his or her actual state and some desired state (Kotler et al., 2005, p.279) The need can be triggered by internal or external stimuli like watching web display ad or television commercial After identifying a need, the customer searches for information Consumer search activity increases as the consumer moves from decision that involve limited problem solving to those that involve extensive problem solving Consumer can obtain information from several sources (Kotler et al., 2005, p.281): personal sources (family, friends, and neighbors), commercial sources (advertising, salespeople, the Internet, packaging, display), public sources (mass media, consumer-rating organizations, and experiential sources (handling, examining, using the product) Information search results in the list of alternatives, which buyer than compare and evaluate In the evaluation stage, consumer ranks alternatives 1238 (brands) and forms purchase intension Generally, consumer purchase decision will be to buy the most preferred alternative (brand) Finally, there is post-purchase stage where the customer evaluates the product and its usefulness based on his expectation of the product, where expectation is based on the messages he received and information he collect from friends and the seller Consumers in the online environment are significantly different from the traditional offline consumers, both in their approach to purchasing, as well as in responses to marketing activities Online consumers are more powerful, in terms of greater bargaining power under the influence of several processes:  Internet increases the bargaining power of consumers through greater price transparency;  Thanks to easier find of new suppliers on the Internet, consumers have more choices;  By easier and quicker gathering information about products and companies via the Internet, consumers have higher level of knowledge; In the Internet market environment, three things are important to consumers: time, privacy and trust Online consumers have growing expectations They set higher standards in the field of service quality, convenience, speed of delivery, price and choice According to Chaffey and Smith (2008, p.152) by observing the purchase decision process, we can identify ways how the online environment is changing consumer behavior:  Search marketing has significantly compressed buying cycle - buying process often begins with generic search on web search engine;  Search for suppliers is also compressed - specialized website for comparing products and companies, with good search engines, significantly reducing the time and changing the way of using this time in the purchasing stage;  Recommendations by other users through user-generated content (UGC) have a significant impact on purchasing decisions;  The brand has become a significant factor in the later stages of the buying process, as it ensures confidence According to a framework build by O`Keefe and McEachern (1998), each of the stages in the purchasing model can be supported by generic Internet and Web facilities 1239 Figure 2: The buying process and how it can be supported by site content Source: Chaffey, D., Smith, PR., (2008), eMarketing eXcellence: Planning and Optimizing Your Digital Marketing, Elsevier Butterworth-Heinemann, Amsterdam, p.153 Figure summarizes how content on site can support the buying process Obviously the process above applies best to high-involvement purchases like a car purchase The Role of the Internet in the Passengers Cars Purchase Process Passenger cars belong to the group of expensive products that are rarely bought, so the consumers undertake complex buying behavior in the process of purchasing Making such purchasing decisions requires a great amount of information Consumers shopping for new and used passenger cars can quickly find a wealth of information and tools on auto manufacturer, dealer and third-party websites The Web gives consumers the power to compare, configure, calculate and communicate: the shopping experience is enhanced In addition the Internet has created a new communication model „many-to-many“, where all participants can not only directly communicate with each other, but also publish content on the Web User generated content (UGC), like online reviews or forum and blog posts, has become important in the „Car-Buying Game“, making social media more influential Recent surveys conducted in developing markets (Brazil, Russia, India and China), and mature markets (France, Germany, UK and USA) show that for all vehicle buyers the Internet is most used, most helpful and most influential information channel According to the findings from the “Automotive Buying Influence Study”1 of recent car buyers conducted in the U.S in September and October 2010, seventy-one percent of consumers use Internet while shopping for new and used vehicles; more than double the usage of any other information source More important, the majority of buyers said the Internet was most influential source leading to their purchase decision In addition, the Internet is also seen as the most helpful information source Two-thirds of consumers rated the Internet as “extremely helpful” (score of “9” or “10” on 10-point scale) In comparison, only about onehalf of used and new vehicle shoppers rated a referral from a friend or family as extremely helpful and other sources (e.g., TV, radio, direct mail) scored much lower Regarding the influence of social media sites, 97 percent of buyers who use Internet to shop indicated that social media did not influence their vehicle purchase The most important reasons why Automotive Buying Influence Study contains findings from 4.005 U.S respondents who purchased a new or used vehicle from a dealer September and October 2010 1240 vehicle shoppers use the Internet are research pricing of car models and makes and ability to compare According to “Automotive Buying Influence Study 2013”, Internet usage increased significantly, with three-quarters of buyers indicating they used the Internet in their carshopping process – up from 71 percent in 2011 Automotive shopping behavior study by Google, Compete and Polk from 20112 shows that vehicle shoppers research and decide what to buy faster than ever They use a diverse set of online tools in their research process and have high expectations from brands throughout the path to purchase Shoppers search to navigate and compare, and they expect dealer sites to be as helpful as OEM sites Finally they watch videos to discover and compare brands According to findings from this study online sources used to research in-vehicle technologies were: car manufacturer websites (37%), dealership websites (30%), professional automotive review websites (26%), search engines (20%), third-party automotive websites (18%) and consumer generated online reviews (12%) Search engines were helpful in obtaining general information (51%), in comparing features across companies (42%), in understanding specific features (35%) and in making decision which company to purchase from (19%) Data Driven Marketing Asia (DDMA) has conducted a year-long study “The Influence Online Information has on Chinese Consumer Buying Behavior”3 among Chinese consumers in Shanghai in 2011 in order to isolate, determine and measure the impact that Internet has on shopping behavior and on marketing communication Findings from a sample of over 500 respondents in Shanghai showed that across 24 most popular product categories listed, an average of 34 percent of respondents stated that they had bought consumer products where online information was the greatest influence on their final purchase decision Fourteen percent of respondents had bought a car in the past 12 months where online information had the greatest influence on their final purchase decision China consumers who were planning to purchase a passenger car consider the information collected from BBS websites and specialist websites such as “Chinacars” to be most important source of online information Capgemini`s “Cars Online 12/13” research4 with more than 8.000 respondents from Brazil, China, France, Germany, India, Russia, United Kingdom, and the United States, confirms the growing role of the Internet in the process of purchasing a car, and the growing influence of social networks According to findings from this study 94 percent of shoppers browse online first In 2002, only 20 percent of survey participants went online before purchasing a car OEM websites (47%), car dealer websites (56%), information web sites (39%) and search engines (39%) are top sources of information to buyers Social media influence consumers Checking out Facebook, Twitter, Youtube, and other social media channels are common practice among today`s car shoppers Survey discovered some differences among consumers in developing markets versus those in mature markets related to social media influence: 83 percent respondents in developing markets rated user-generated content as “important” or “very important” (in mature markets, 59 percent said the same) http://www.thinkwithgoogle.com/research-studies/automotive-shopping-behavior-study-2011.html http://www.ddm-asia.com/en/published_studies/online_impact_study_2011/introduction.html http://www.capgemini.com/resource-file-access/resource/pdf/carsonline_12-13_final_web_1.pdf 1241 Figure 3: Use of information Sources to Research Vehicles (% saying) Source: Capgemini Valicon study conducted in 2013 in Croatia5, polled more than 3,000 respondents (i.e 1700 customers) in five categories of products and services: buying a car, consumer electronics, arranging travel and leisure, banking and insurance When buying a car of customers in Croatia and two of three customers in Slovenia need almost six months for a decision Most requested information when buying a car are prices, information on fuel consumption, maintenance costs, features and design of the car Valicon survey also confirmed the growing importance of "word of mouth", given that about 90 percent of today's consumers prefer to share their experience with other people Passengers car market in Bosnia and Herzegovina Bosnia and Herzegovina is characterized by very adverse political, social and economic environment that affects most of the markets, including the passenger cars market The most common source of financing the purchase of car is a bank loan Bank loans are characterized by high interest rates and required extensive credit insurance in the form of guarantors The average monthly salary recorded in the first quarter of 2013 was 421 EUR, while the annual rate of unemployment in the same period was 27.5 percent The bad economic situation with a very unfavorable political situation and the general feeling of insecurity influenced the market of passenger cars reducing the number of new passenger cars sold in the last two years Customers are mostly opting for import of used cars from abroad or buying used cars in the country http://www.valicon.net/hr/valicon/aktualnosti/novosti/263/gotovo_svi_hrvatski_potrosaci_istrazuju_najbolju_p onudu_prije_donosenja_odluke_o_kupnji.html 1242 Table 2: The main economic indicators for Bosnia and Herzegovina Indicators 2009 2010 2011 Nominal GDP (billions EUR) GDP per capita (EUR) The real growth rate of GDP (%) The growth rate of industrial production (%) The average net salary (EUR) The annual rate of inflation (%) The annual unemployment rate (%) Population (millions) 2012 I-IV 2013 12.3 3194 -2.9 -3.3 12.7 3296 1.3 1.6 13.1 3419 1.0 5.6 13.1 3419 -1.1 -5.2 n/a n/a n/a 7.0 404 -0.4 24.1 3.84 408 2.1 27.2 3.84 417 3.7 27.6 3.84 422 2.1 28.0 3.84 421 0.6 27.5 3.84 Source: Central Bank of Bosnia and Herzegovina The total number of registered road motor vehicles in Bosnia and Herzegovina in 2012 was 1,096,232, which presents an increase of 69,978 vehicles (6.82%) as compared to 2011 The number of registered new road motor vehicles in the 2012 totaled 9505, 6923 of which were new passenger vehicles (72.84%) During the 2012 the number of new passenger vehicles sold was reduced by 1827 vehicles (20.88%) compared to 2011 The number of first time registered vehicles in 2012 (new vehicles and imported used vehicles) amounted to 61958 vehicles, of which 51051 were passenger cars.6 According to BIHAMK research, in 2012 the best selling makes of new cars in Bosnia and Herzegovina were: Škoda (1324), Volkswagen (1244), Opel (591), Chevrolet (466), Renault (464), Citroen (343), Dacia (326), Audi (291), Ford (257), Toyota (236), Peugeot (217) and Hyundai (179) According to the data of the Indirect Taxation Authority in Bosnia and Herzegovina (UNO BH), during the 2013 a total of 58407 passenger vehicles (570 million BAM) were imported.7 The number of Internet users in Bosnia and Herzegovina in 2012 amounted to 2,184,500 users, while number of Internet subscribers was 551,037 Table 3: The number of Internet users in Bosnia and Herzegovina (2007-2012) Year 2007 2008 2009 2010 2011 2012 No of Internet Users 1.055.000 1.307.585 1.421.540 2.000.000 2.113.100 2.184.500 Index 111,05 123,94 108,71 140,69 105,66 103,38 Source: Communications Regulatory Agency BH BH Auto Moto Club (BIHAMK): Information on the total number of registered and sold new motor vehicles in Bosnia and Herzegovina in the period January - December 2012 http://dnevni-list.ba/web1/2014/02/04/poboljsan-vozni-park-u-bih-u-2013-uvezeno-automobila-u-vrijednosticak-570-milijuna-maraka/ 1243 The Internet penetration rate in Bosnia and Herzegovina in 2012 was 57 percent, representing an increase of percent compared to the previous year, and increase of percent compared to 2010 Statement of the problem Traditionally, buying a passenger car implied numerous visits to car showrooms, comparison of characteristics based on information from catalogs and magazines, seeking opinions from family and friends, word-of-mouth from friends and acquaintances and finally experiences the car through the test drive Development of information and communication technologies (ICT), particularly the Internet and mobile communications, has enabled customers easier and faster access to more information relevant when purchasing a passenger car, such as information on prices, characteristics of vehicles, dealers, financing opportunities, etc Some of the previous studies have shown significant differences in the application and importance of the Internet in purchasing passenger cars among buyers from developing countries and developed countries As there has been no research on this topic in Bosnia and Herzegovina, scientific problem can be defined as the need for examination of role of the Internet in the purchase decision making process for passenger cars in Bosnia and Herzegovina Based on problem analysis above, we identified the main hypothesis that will serve as the foundation for the purpose of this paper: H0 - For passenger car buyers in Bosnia and Herzegovina, the Internet is most used, most helpful and most influential information channel that supports their purchase decisions To make it easier to read the paper and make clearer assumptions, the main hypothesis is divided into three-part hypotheses H0:1 - For passenger car buyers in Bosnia and Herzegovina, the Internet is most used information channel that supports their purchase decisions H0:2 - For passenger car buyers in Bosnia and Herzegovina, the Internet is most helpful information channel that supports their purchase decisions H0:3 - For passenger car buyers in Bosnia and Herzegovina, the Internet is most influential information channel that supports their purchase decisions Objectives of research To determine which information sources are preferred to gather information when purchasing a passenger car in Bosnia and Herzegovina To determine which information sources are the most influential on customers in making purchase decision for a passenger car in Bosnia and Herzegovina To determine which information sources are the most helpful for customers in making purchase decision for a passenger car in Bosnia and Herzegovina To determine does user-generated content (UGO) on social networks and forums influences the customers when making a decision about buying a passenger car in Bosnia and Herzegovina To determine for which type of information on passenger cars buyers usually search on the Internet 1244 Research methodology The study is exploratory in nature and based on primary and secondary information Secondary information, mostly used for problem definition is collected from different reports, the Internet and periodicals Primary information is gathered using online survey methods Previous research has examined a large number of factors that increase response rates and improve data quality In terms of online surveys, the most important factors to consider are follow-ups, incentives, personalization and length and presentation of the questionnaire (Church, 1993; Dillman, 2000; Fox et al., 1988; Yammarino et al., 1991) To elicit the responses, a detailed structured questionnaire with 16 questions has been designed and surveyed online using “Lime Survey” web application We have used „phpList 3.0.5.“ web application for e-mail marketing to sent short email requests with web survey link to 30.000 registered members of two websites: www.automarket.ba (car classifieds website) and www.nekretnine365.com (real estate classifieds website) E-mail messages were personalized to each person by name (e.g., "Dear John Smith") Each participant who completes the survey has been offered to participate in a drawing for three prizes (smart phone Samsung Galaxy S4, Sony mp3 Player, IronMan USB memory sticks 32gb) by submitting his e-mail address or phone number on last page of the web survey After the survey has been completed, the winners have been randomly selected from the table with participants’ e-mails and phone numbers In the e-mail message we stated who is conducting the survey and how obtained information will be used Three types of questions were used in the survey To test consumer attitudes about the influence, frequency of use and usefulness of different sources of information in purchasing a passenger car, as well the attitudes about the importance of certain options on the website that sells vehicles, we used point Likert`s item questions (strongly agree, agree, neutral, disagree, and strongly disagree) The score was indicating the option “strongly disagree”, and the score on the scale, shows the category “strongly agree”, for all questions To collect data about the source of information used when buying a passenger car and specially the purpose of using the Internet when buying a passenger car, we used “multiple choices with multiple answers” questions Single choice survey questions have been used to collect demographic data and information about the frequency of use of the Internet and the status of the user in terms of purchasing a car Statistics from “phpList” application shows that from 30.000 e-mail messages sent, 4617 email messages were viewed (15.39%) This information should be taken with caution because “phpList” is using a method of placing an invisible image in e-mail messages to register who has opened the message, so this provides a minimum statistic, as many email clients with privacy or security policies block images (gmail, thunderbird, and others) Total of 1211 responses were received (4 percent response rate8), of which 934 full responses (3.11 percent response rate) and 277 incomplete responses We have analyzed only the full responses data through SPSS 19 package The results of empirical findings and major findings of the survey are as follows: Response rate is calculated on the total number of sent e-mail messages The response rate to the total number of viewed e-mail messages was 26.2 percent 1245 Data analysis and interpretation The data collected is tabulated in Table on demographic characteristics of the respondents Table 4: Demographic characteristics of the sample Gender male female total Marital Status married unmarried Education primary school secondary school college university degree master's degree PhD does not want to declare Age below 24 25 – 32 33 – 47 48 – 66 above 66 Employment employed in public company employed in private company independent craftsman retired unemployed Family income (per month) below 1000 BAM 1001 – 1500 BAM 1501 – 2000 BAM 2001 – 2500 BAM 2501 – 3000 BAM 3001 – 3500 BAM 3501 – 4000 BAM above 4000 BAM does not want to declare Current place of residence Bosnia and Herzegovina European Union Some other country/region No of Respondents % 717 217 934 76.8 23.2 100 662 272 70.9 29.1 328 122 379 63 30 0.3 35.1 13.1 40.6 6.7 1.0 3.2 40 250 454 180 10 4.2 26.8 48.6 19.3 1.1 274 339 123 43 155 29.3 36.3 13.2 4.6 16.6 204 191 143 84 68 29 24 37 154 21.8 20.4 15.3 9.0 7.3 3.1 2.6 4.0 16.5 771 84 79 82.5 8.5 The data in Table shows the presence of males (76.8%) as majority of respondents with half of respondents falling in the age category of between 33-47 years (Gen X), and one quarter of respondents falling in the age category of between 25-32 years (Older Millenials) Most of the respondents were married (70.9%), and employed (78.8%) The family income of the majority of respondents was found to be below 2000 BAM per month (57.5%), while 16 percent of respondents did not want to declare the amount of monthly income The two largest categories in terms of education level are persons with a university degree (40.6%) and persons who completed secondary school (35.1%) 1246 Table 5: Average daily Internet usage by gender Usage time Less than 30 minutes 31 - 60 minutes - 1,5 hours 1,5 - 2,5 hours 2,5 - 3,5 hours More than hours Total Count % within gender % of Total Count % within gender % of Total Count % within gender % of Total Count % within gender % of Total Count % within gender % of Total Count % within gender % of Total Count % of Total Gender female 14 6,5% 1,5% 35 16,1% 3,7% 48 22,1% 5,1% 39 18,0% 4,2% 29 13,4% 3,1% 52 24,0% 5,6% 217 23,2% male 32 4,5% 3,4% 114 15,9% 12,2% 179 25,0% 19,2% 171 23,8% 18,3% 83 11,6% 8,9% 138 19,2% 14,8% 717 76,8% Total 46 4,9% 4,9% 149 16,0% 16,0% 227 24,3% 24,3% 210 22,5% 22,5% 112 12,0% 12,0% 190 20,3% 20,3% 934 100,0% One fifth of total respondents are using the Internet less than 60 minutes per day (20.9%), and one fifth declared that they use Internet more than hours per day (20.3%) Similarly, 24.3 percent of respondents are using the Internet between and 1.5 hours per day, and 22.5 percent of them between 1.5 and 2.5 hours per day, while 12 percent of respondents are using the Internet between 2,5 and 3.5 hours per day Respondents were asked about their status in relation to the purchase of new and used passenger cars The data in Table shows that 73.7 percent of respondents (688) have recently bought or they intend to buy a new or used passenger car, of which 77.8 percent have bought or intends to buy used passenger car (535) and 22.2 percent have bought or intends to buy new passenger car Table 6: Status of the respondents regarding purchasing passenger cars Count Recently bought or intends to buy a % within country/region new passenger car % of Total Count Recently bought or intends to buy a % within country/region used passenger car % of Total Count Not recently bought nor intends to buy % within country/region in this year a new or used passenger car % of Total Count % within country/region Total % of Total Current place of residence Other BiH EU country 115 17 21 14,9% 20,2% 26,6% 12,3% 1,8% 2,2% 467 34 34 60,6% 40,5% 43,0% 50,0% 3,6% 3,6% 189 33 24 24,5% 39,3% 30,4% 20,2% 3,5% 2,6% 771 84 79 100,0% 100,0% 100,0% 82,5% 9,0% 8,5% Total 153 16,4% 16,4% 535 57,3% 57,3% 246 26,3% 26,3% 934 100,0% 100,0% 1247 Table 7: Use of different information sources for passenger car purchase Responses Percent of Cases N Percent Newspapers (classifieds), magazines, television 202 11,1% 21,6% Internet 817 45,1% 87,5% Family, friends and relatives 281 15,5% 30,1% Dealers 231 12,7% 24,7% Automobile mechanic 174 9,6% 18,6% Car market 71 3,9% 7,6% Auto Expo/Exhibition 26 1,4% 2,8% Buyers without information search 10 0,6% 1,1% 1812 100,0% 194,0% Total Table shows that majority of respondents (98.9% i.e 924 out of 934) found to make a prior search from various information sources such as newspapers, Internet, family and friends, car dealers, car mechanics etc before taking a buying decision From the table is clear that majority of purchasers of passenger cars in Bosnia and Herzegovina (87.5%) relies on information obtained over the Internet Other vastly used information sources are family, friends and relatives (30.1%), dealers (24.7%), car advertisements in newspapers, magazines and on TV (21.6%) and automobile mechanics (18.6%) We have asked respondents to express their agreement or disagreement with the statement that specific source of information has a significant influence on their decision to purchase passenger car in Bosnia and Herzegovina As explained earlier, we used point Likert`s item questions The results are shown in Table Table 8: Information sources and their influence on decision making Newspaper, Magazines, Internet TV N Mean Std Error of Mean Median Mode Std Deviation Variance Range Minimum Maximum % agree with significant influence % not agree with significant influence % neutral Friends, Family, Relatives Dealers Auto Expo / Car market Automobile Exibitions in my city mechanic Other source 934 3,40 ,033 4,00 1,021 1,042 55.8 934 4,26 ,027 4,00 ,820 ,673 90.5 934 3,84 ,031 4,00 ,953 ,909 74.4 934 3,29 ,035 3,00 1,080 1,167 48.7 934 3,02 ,035 3,00 1,080 1,167 33.6 934 2,67 ,036 3,00 1,108 1,228 24.2 934 3,58 ,036 4,00 1,115 1,242 64.9 934 2,98 ,032 3,00 ,985 ,971 25 18.3 4.3 10.3 22.8 27.7 42.7 17.7 21.9 25.9 5.2 15.3 28.5 38.7 33.1 17.5 53.1 1248 From the Table 8, it is evident that most influential source of information for passenger car buyers in Bosnia and Herzegovina was the Internet with a mean of 4.26 and mode of Almost half of the respondents (48.3%) agree with the statement that the Internet has a significant influence on their decision to purchase passenger cars, while 42.2 percent strongly agree with this statement Second most influential source of information is “friends, family and relatives” with a mean of 3.84 and mode of Three quarters of respondents (74.4%) agreed with the statement that friends, family and relatives have a significant impact on their purchase decision (51.5% agree, 22.9% strongly agree) Third information source by its influence on purchase decision is automobile mechanics with a mean of 3.58 and mode of 4, where 64.9 percent of respondents agree that this information source has significant influence on their decision (46.8% agree, 18.1% strongly agree) Newspapers, magazines and TV are considered as very influent sources of information for 55.8 percent of respondents In addition to the influence of certain sources of information, we wanted to find out which one is the most useful source of information for the customers when making a decision about buying a passenger car Table 9: Usefulness of specific information source for passenger car purchase Internet N Mean Std Error of Mean Median Mode Std Deviation Variance Skewness Std Error of Skewness Kurtosis Std Error of Kurtosis Range Minimum Maximum % agree with significant usefulness % not agree with significant usefulness % neutral 934 4,35 ,030 5,00 ,910 ,828 -2,039 ,080 4,644 ,160 92.4 Newspapers, Friends, magazines, family, TV relatives 934 934 3,46 3,79 ,033 ,032 4,00 4,00 4 1,004 ,986 1,008 ,972 -,754 -1,010 ,080 ,080 ,013 ,848 ,160 ,160 4 1 5 60 73 Dealers 934 3,24 ,036 3,00 1,094 1,197 -,434 ,080 -,512 ,160 47 Auto Expo Car Automobile / market in mechanic Exibitions my city 934 934 934 3,01 2,72 3,55 ,035 ,036 ,037 3,00 3,00 4,00 3 1,085 1,101 1,117 1,177 1,211 1,249 -,243 ,013 -,799 ,080 ,080 ,080 -,507 -,784 -,087 ,160 ,160 ,160 4 1 5 33.7 25.3 64.4 Other source 934 2,98 ,032 3,00 ,971 ,943 -,342 ,080 ,213 ,160 24.9 6.2 18.2 11.5 24.1 27.7 40.9 18.6 21.1 1.4 21.8 15.5 28.9 38.6 33.8 17 54 The analysis shows that most useful source of information for passenger car buyers in Bosnia and Herzegovina was the Internet with a mean of 4.35 and mode of More than half of the respondents (52.1%) strongly agree with the statement that the Internet was especially useful information source for their decision to purchase a passenger car, while 40.3 percent agree with this statement Second most useful source of information is “friends, family and relatives” with a mean of 3.79 and mode of Three quarters of respondents (73%) agreed with the statement that friends, family and relatives are especially useful for their purchase decision (52% agree, 21% strongly agree) Third information source by its usefulness on purchase decision is automobile mechanic with a mean of 3.55 and mode of 4, where 64.4 percent of respondents agree that this information source was very useful for their purchase decision (46.8% agree, 18.1% strongly agree) Newspapers, magazines and TV are considered as very useful sources of information for 60 percent of respondents 1249 Analysis of the usefulness of information sources confirms the findings of previous analyzes of the influence of certain sources, ranking the Internet in the first place as the most influential and the most useful source of information for passenger car buyers in Bosnia and Herzegovina Table 10: Most influential and most useful sources of information for passenger car buyers Rank Source Internet Friends, Family, Relatives Automobile mechanic Newspapers, magazines, TV Average mean (very influential and useful) (min 1, max 5) 4.3 3.8 3.6 3.4 Average mode (very influential and useful) (min 1, max 5) 4.5 4 To find out how often respondents use different Internet sources in process of making passenger car purchase decision, we have used Likert`s item question for each Internet source to test the respondent agreement or disagreement with the statement that he visited very often that Internet source when buying a passenger car Internet encyclopedia Blogs 934 2,83 3,00 1,072 1,148 ,000 ,080 934 3,01 3,00 1,085 1,178 -,184 ,080 934 934 2,46 2,63 3,00 3,00 3 1,004 1,015 1,008 1,030 ,202 ,053 ,080 ,080 -,010 ,160 -,607 2,713 ,160 ,160 5 RSS feeds Video and photo sharing services 934 3,04 3,00 1,071 1,147 -,158 ,080 Microbloging services Online car magazines 934 3,43 4,00 1,032 1,065 -,558 ,080 Web forums Social networks Search engines 934 2,62 3,00 1,123 1,262 ,182 ,080 Internet classifieds 934 934 934 934 934 3,62 3,26 4,16 3,84 3,66 4,00 3,00 4,00 4,00 4,00 4 4 1,124 1,107 ,876 1,043 1,071 1,263 1,224 ,767 1,089 1,147 -,862 -,425 -1,430 -,901 -,692 ,080 ,080 ,080 ,080 ,080 Dealer websites N Mean Median Mode Std Deviation Variance Skewness Std Error of Skewness Kurtosis Std Error of Kurtosis Range Minimum Maximum Manufacturer websites Table 11: Very often used Internet sources when buying passenger car ,359 ,160 -,052 ,160 -,670 ,160 -,326 ,160 -,629 ,160 -,583 ,160 -,663 ,160 -,281 ,160 -,313 ,160 5 5 5 5 1250 Figure 4: Do you agree with the statement that you visit very often given Internet source? Figure shows that most visited Internet sources for passenger car buyers in Bosnia and Herzegovina are: Internet classifieds websites, search engines, dealer websites, Internet forums (discussion groups), online car magazines and manufacturer websites One fifth of the respondents (20.8%) visit very often social networks like Facebook while searching for car information, and one fourth of respondents (26.3%) that in online encyclopedias One third of respondents (33.4%) are visiting often online car blogs, and only 11 percent are searching car information on microbloging services like Twitter To sindicate car information from different websites, 15.6 percent of respondents are using RSS feeds Figure provides an overview of ten most used applications of the Internet in the process of gathering information on passenger cars Figure 5:Why passenger car shopers use the Internet (% of total respondents) Figure shows how respondents see the importance of certain options on the website of car dealers/manufacturers 1251 Figure 6:Very important website options for passenger car buyers (% of respondents agree) Conclusion Passenger cars belong to a group of expensive products that are rarely bought, so the consumers undertake complex buying behavior in the process of purchasing, which requires a great amount of information The investigation of the paper has revealed that majority of passenger car buyers in Bosnia and Herzegovina (98.9%) make a prior search from various information sources such as newspapers, magazines and TV (21.6%), the Internet (87,5%), family, friends and relatives (30.1%), car dealers (24.7%), automobile mechanics (18.6%) etc before making a buying decision The Internet in Bosnia and Herzegovina becomes one of the most consumed media, with 79 percent of respondents using it more than hour a day, and 32.3 percent of respondents using it more than 2.5 hours a day It is evident that the Internet has become an increasingly important component of the passenger car purchase process, as it is three times more used by passenger car buyers in relation to any other source of information, which confirms our auxiliary hypothesis H0:1 The investigation also shows that majority of passenger car buyers in Bosnia and Herzegovina agree that the Internet was the most influential (90.5%) and most helpful (92.4%) information source, which confirms our auxiliary hypotheses H0:2 and H0:3 Two reference groups that play an important role in buying decision of passenger cars with significant influence on buyers are “family, relatives and friends” (74.4%) and automobile mechanics (64.9%) Both reference groups are also seen as very useful information sources To invest wisely in their online presence, it`s important that car dealers, car manufacturers and third-party sites understand why and how consumers use the Internet during the car buying process Car buyers use a variety of Internet sources to gather information, and this paper shows that six most visited (most used) sources are: internet classifieds (86.1%), search engines (71.3%), dealer web sites (67.9%), Internet forums (63%), online car magazines (56.5%) and manufacturer websites (49%) In addition to the Internet forums, other social platforms such as services for video and photo sharing (36.1%), blogs (35.7%), the online encyclopedia (26.3%), social networks (20.8%) and microbloging services (11%) are not very often used by a larger number of car buyers in the process of gathering information Most important reasons why passenger car buyers in Bosnia and Herzegovina are using the Internet are: research car pricing (82%), finding/locating specific car (64.1%), view interior/exterior car photos (63.40%), compare cars (57.8%) and read car reviews (53.2%) The implications to car dealers in Bosnia and Herzegovina and car manufacturers are clear: leverage the Internet to influence a buyer`s consideration set and create visibility for your 1252 brand Give buyers not only information on 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