Factors affecting online impulse buying behavior in fashion products in vietnam

The results indicate that all factors such as: impulsiveness, electronics word of mouth, hedonic shopping motivation, convenience orientation, sales promotion, website quality play signi

UNIVERSITY OF ECONOMICS HO CHI MINH CITY

International School of Business

-TRUONG KIM NGAN

FACTORS AFFECTING ONLINE IMPULSE BUYING BEHAVIOR IN FASHION PRODUCTS

IN VIETNAM

MASTER OF BUSINESS (Honours)

Ho Chi Minh – 2015

UNIVERSITY OF ECONOMICS HO CHI MINH CITY

International School of Business

-

TRUONG KIM NGAN

FACTORS AFFECTING ONLINE IMPULSE BUYING BEHAVIOR IN FASHION PRODUCTS

IN VIETNAM ID:22130044

MASTER OF BUSINESS (Honours) SUPERVISOR: Dr LE NHAT HANH

Ho Chi Minh – 2015

ACKNOWLEDGEMENTS

The completion of this thesis is a remarkable achieve in my life It has been several months and required a great effort for the research I would like to express my gratitude to all ISB staffs that supported necessary materials and helped summit my papers I also wish to express my deeply thank you for the support, patience and encouragement from my family, my colleagues and my classmates helped me to completing this thesis

Especially, I would like to give my special thanks to Doctor Le Nhat Hanh for supporting and guiding me with this research

STATEMENT OF AUTHENTICATION

(Candidate Certificate)

I certify that the work in the thesis entitled “Factors affecting online impulse buying behavior in fashion products in Vietnam” is the result of my own research and has not been submitted for a higher degree to any university or institution other than International School

of Business (ISB)

I also certify that the thesis has been written by me Any help and assistance that I have received in my thesis have been appropriately acknowledged

Ho Chi Minh City, 21 December 2015

Truong Kim Ngan

TABLE OF CONTENTS

CHAPTER I: INTRODUCTION 1

1.1.Research background 1

1.2 Research objectives 2

1.3 Research methodology and scope 3

1.4 Significance of the study 4

1.5 Structure of the study 4

CHAPTER II: LITERATURE REVIEW 5

2.1 Impulse Buying 5

2.1.1 Definition 5

2.1.2 Classification of impulse buying 7

2.1.3 Impulse buying model 8

2.2 Online Impulse Buying 10

2.3 Factors affecting online impulse buying 12

2.3.1 Impulsiveness 12

2.3.2 Electronic word of mouth 12

2.3.3 Hedonic shopping motivation 14

2.3.4 Convenience orientation 15

2.3.5 Sales promotion 16

2.3.6 Website quality 16

2.4 Hypothesis & Research Model 18

2.5 Consumer’s characteristics 19

CHAPTER III: RESEARCH METHODOLOGY 23

3.1 Research Process 23

3.2 Qualitative research 24

3.3 Quantitative research 27

3.3.1 Questionnaire 27

3.3.2 Data collection method 27

3.3.3 Sample size 28

3.3.4 Data analysis method 28

CHAPTER IV: ANALYSIS RESULTS 32

4.1 Sample description 32

4.2 Reliable analysis 33

4.3 Exploratory factor analysis 35

4.3.1 Exploratory Factor Analysis for independent variables 36

4.3.2 Exploratory Factor Analysis for online impulse buying behavior 41

4.4 Testing correlations between all constructs 43

4.5 Testing the research model and the hypotheses 43

4.6.1 Influence of gender 47

4.6.2 Influence of age 48

4.6.3 Influence of education 49

4.6.4 Influence of income 50

4.7 Discussions 51

CHAPTER V: CONCLUSIONS AND IMPLICATIONS 53

5.1 Conclusions 53

5.2 Implications 54

5.3 Limitations and implications for future research 57

REFERENCES 58

REFERENCE

APPENDIX

LIST OF ABBREVIATIONS

LIST OF TABLES

Table 3.1: Measurement scale ……… …… 26

Table 4.1: Demographic Characteristics of the Study……… 32

Table 4.2: Cronbach's Alpha measures of variables in the study……… …… 34

Table 4.3: KMO and Bartlett's Test (EFA for independent variables the first time)……… ……

36 Table 4.4: Total Variance Explained (EFA for independent variables the first time)……….………

37 Table 4.5: Rotated Component Matrix……… …… 38

Table 4.6: KMO and Bartlett's Test (EFA for independent variables the second time)……… ………

39 Table 4.7: Total Variance Explained (EFA for independent variables the second time)………

39 Table 4.8: Rotated Component Matrix……… …… 41

Table 4.9: KMO and Bartlett's Test (EFA for online impulse buying behavior)……… ………

42 Table 4.10: Total Variance Explained (EFA for online impulse buying behavior)……… ………

42 Table 4.11: Component Matrixa (EFA for online impulse buying behavior)……… ………

42 Table 4.12: Correlations……….… 43

Table 4.13a: ANOVA……… 44

Table 4.13b: Model Summary……… 44

Table 4.13c: Coefficients……… 47

Table 4.14a: Independent Samples Test (gender) ……….……… 48

Table 4.14b: Group Statistics (gender)……… 48

Table 4.15a: Test of Homogeneity of Variances (age)……… 48

Table 4.15b: ANOVA (age)……… 49

Table 4.15c: Report (age)……… 49

Table 4.17a: Test of Homogeneity of Variances (income)………… ……… 50

Table 4.17c: Report (income) ……… 51

LIST OF FIGURES

Figure 2.1: Churchill and Peter’s model of Impuse buying process 09

Figure 2.2: Research Model……….…….………19

Figure 3.1: Research Process……….….…….………… 23

Figure 4.1: Histogram……… … ………43

Figure 4.2: Scatter Diagrams……… …….………… 46

ABSTRACT

This study will broaden my understanding about online impulse buying in general as well as in fashion products category The research also enhances the main factors affecting impulse buying and propose implications to enhance customer’s impulse buying behavior The researcher validate factors affecting to online impulsive buying by analyzing data collected via a web-based questionnaire survey from 352 online customers The results indicate that all factors such as: impulsiveness, electronics word of mouth, hedonic shopping motivation, convenience orientation, sales promotion, website quality play significant role in online impulse buying beavior In addition, it provides that these main factors not only has a direct impact on online impulsive buying, but also an indirect influence through age, gender, income… This group of factors will not be examimed as hypothesis The study takes and simple testing the effect of this group factor impact to online impulsive buying behavior Besides, this study also presents about the method and research design used in the current study to explore these relationships The procedure to analyze the data collected will be mentioned this research Accordingly, the process includes test of cronbach‘s alpha coefficient of reliability, EFA and regression by SPSS software

It implies that the online retailer have to pay attention to improve their advantages compettiton such as: sales promotion-the most important factor affecting online impulse buying behavior, some actions can express an impulsiveness customer characteristics Others factors e-WOM, website quality also play an important role Therefore, online retailers who want to encourage their customers to buy impulsively should pay great attention to these dimensions The research findings also engage with some limitations in the strength of measurement scale, the sampling method as well as the fitness between the research model and data It results in the valuable directions for further researches in future

In recent years, e-commerce development in Vietnam maintained a strong pace forward due to the booming of Internet In parallel with massive internet application trend, e-commerce has been getting into various branches of business and daily life, becoming a significant tool for enterprises and residents The rapid expansion of the country’s e-commerce sector, thanks to the fast growth rate of Internet users, has forced The Vietnam E-Commerce and Information Technology Agency (VECITA) to revise its 2015 forecast for the sector from $1.3 billion to over $4 billion in revenue (Vietnam e-commerce report 2014)

Given the current Internet population of more than 30 million, economic development will grant Internet access to even more people in the next two years With 40-45 percent of its population forecasted to use the Internet by 2015, VECITA foretold that every Vietnamese person will spend at least $150 on e-commerce purchases per year A survey of 781 online shoppers in 2014 conducted by tuoitrenews.vn indicated that 61 percent of them purchased items via e-commerce websites, 51 percent through group-buying websites, 45 percent by means of social forums, 19 percent by way of e-marketplace websites, and six percent via mobile applications The most popular online product categories were fashion, shoes and

cosmetics, making up 62 percent Second ranked technology products (35 percent), followed

by household products (32 percent), and flight tickets (25 percent)

The growth of electronic commerce has led to a number of research studies aimed at understanding how traditional offline consumer behavior manifests in an e-commerce domain In the offline contexts, impulse buying can account for between 30 and 50 percent

of all retail sales (Hausman, 2000) Given the prominence of impulse buying in offline retail environments, impulse buying has been identified as a phenomenon that is also prevalent in online contexts (Li, H., C Kuo, and M G Russell., 1999) Understanding of impulse buying

is further confounded by the prevalence of online retailing, an easily available mode for making impulse purchases Online retailing eliminates the constraints of time and space that often face shoppers And recent study found that Internet shoppers are more impulsive than in-store shoppers However, consumer behavior on the Internet is not well understood Furthermore, most of conceptualizations do not account for impulse purchases online Despite the fast growth of e-commerce, the number of studies were conducted about online shopping Vietnam is very little In addition, there is no research studying about online impulse buying Therefore, it is necessary to conduct a study to broaden the concept of impulse purchasing and examine impulsive purchasing online in Vietnam e-commerce online market

As mentioned above, research on impulse buying has been based on various conceptual definition and mostly focused on in-store retailing In this research, researcher attempt to broaden the concept of impulse buying behavior and explore the factors affect impulse buying

on the Internet With the booming of online retailing, it would seem appropriate to expand the concept of impulse buying to accurately capture online impulse purchasing behavior Therefore, this research will try to figure out the main factors affecting impulse buying and propose implications to enhance customer’s impulse buying behavior

atmosphere of store, or enticing product arrangements This is widely understood via many studies However, little is known about the identity and nature of factors that may trigger or inhibit impulse buying during online transactions Questions pertaining to which factors significant effects on impulse buying in online setting have not been conclusively answered According to above discussion, this study is formulated to obtain following objectives:

(1) To understand clearly about impulsive buying and online impulsive buying

(2) To identify and test various factors such as impulsiveness, electronic word of mouth, hedonic shopping motivation, convenience orientation, sales promotion, website quality that may influence online impulse buying in fashion product in Vietnam

(3) How do these factors affect to the impulsive buying behavior when people go shopping online, especially fashion product market

1.3 Research methodology and scope

The research is conducted on online consumers in Ho Chi Minh City, the biggest city

in Vietnam Particularly, data is collected from indepth interview from two types of person one was from young officers of company and another was from student of University in Ho Chi Minh The researcher then validate factors affecting to online impulsive buying by analyzing data collected via a web-based questionnaire survey from 400 online customers Content of questionnaire focus on fashion product, the most popular online product in Vietnamese e-commerce market

The researcher will use Microsoft Excel and SPSS to handle the collected data and to perform the research Then, using SPSS to test the scale reliability (Cronbach’s Alpha), Factor analysis to determine which of a large set of items were answered most similarly by the respondents, using Multiple Regression to check the relationship between independent variables and dependent variables

1.4 Significance of the study

This study will broaden understanding about online impulse buying in general as well

as in fashion products category Furthermore, online retailers would have a tool that could be employed to examine current and potential patrons, thereby providing guidance for store design and marketing communications strategy

1.5 Structure of the study

This study is organized into five chapters:

Chapter I: Introduction

This chapter presents the research background of the study, research objectives, research scopes and methodology, the significance of the study, and the research structure

Chapter II: Literature review and hypotheses

In this chapter, the researcher presents the fundamental theories and definition of each mentioned concept and theoretical modeling with the proposed hypotheses In this chapter, the conceptual model of the study is also presented

Chapter III: Research Methodology

This chapter mentions about the research design, research methodology and illustrate the process of conducting the research

Chapter IV: Analysis Results

For this chapter, the researcher summaries the characteristics of collected samples and presents the result of the research after analyzing collected data Based on that result, the researcher draws the conclusions for the research hypotheses proposed in Chapter 2

Chapter V: Conclusions and implications

This chapter performs the main results of the research, the contribution of the study in management theory and practice as well as the limitations of the study for future research direction

CHAPTER II: LITERATURE REVIEW

In this chapter, some literatures are reviewed concerning the impulse buying and online impulse buying This research will continue by presenting some popular model related to impulse buying Finally, based on literature and model presented, the research model of impulse buying in fashion in Vietnam will be presented

2.1 Impulse Buying

2.1.1 Definition

In the traditional decision-making model, the consumer carefully searches for information on the product, weights the pros and cons, and eventually makes an informed decision This process is elaborate and therefore not applied for all decisions It is not a correct portrayal for many buying decisions Some decisions are made under low involvement conditions Many of these decisions are a learned response to environmental factors and specific stimuli Actions like these are called the impulse buying behavior Consumer engage

in impulse buying when they feel the need to buy something immediately without concerning the consequences Here, the decision is driven by emotions than by rational thinking According to many researchers, impulse buying account for a substantial percentage of the product turnover across a broad range of product One study suggest that impulsive buyer account for 1% to 8% of the population, while others claim that 90% of all consumer make impulse buying Fashion and related products, such as accessories and shoes, are one of the top categories to be bought on impulse (Nguyen Thi Tuyet Mai et al 2003)

The importance of impulse buying in the marketing literature was first identified over seventy years ago with the research of Clover (1950) And a futher of researchers have made important contributions to our understanding of impulse purchasing According to Stern

(1962), unplanned buying refers to purchases that were not planned in advance, and includes

impulse buying Stern (1962) classified impulse buying into four types: pure, reminder, suggestion and planned Stern’s concept is quite significant, because even today most research studies use his concept of impulse purchase as a starting point Over time, researchers began

to look at consumer characteristics parallel with product characteristics or stimuli as it was agreed that impulse purchasing is not confined to any particular product or product category Then Rook (1987) suggests impulse buying occurs: “when a consumer experiences a sudden, often persistent urge to buy something immediately The impulse to buy is hedonically complex and may stimulate emotional conflict Also, impulse buying is prone to occur with diminished regard for its consequences” This definition has acquired much wider acceptance than the other previously discussed definitions However, many have viewed impulse buying negatively, perhaps due to the lack of perceived behavioral control that is associated with impulsivity However, Piron (1991) argues Rook’s definition is too narrow since it implies that emotional and cognitive reactions must accompany the purchase, because whether or not customer experiences emotional and cognitive reactions may depend on the economic, personality, and cultural factors on behalf of the customer and characteristics and price on behalf of the product Piron (1991) defined that impulse buying as “a purchase that is unplanned, the result of an exposure to a stimulus, and decided on the spot” After 8 years, Beatty and Ferrell (1998) provided a more extensive definition in that impulse buying is considered as sudden and immediate purchase with no pre-shopping intentions either to buy the specific product category or to fulfill a specific buying task The behavior occurs after experiencing an urge to buy and it tends to be spontaneous and without a lot of reflection It does not include the purchase of a simple reminder item, which is an item that is simply out-of-stock at home Similar to Rook’s definition this definition does not consider the role of stimuli in the impulse purchase decision While early impulse purchase research focused on the product as stimuli, it is likely that advertisements, articles and word of mouth can act as stimuli Futhermore, Wells, Parboteeah, and Valacich (2011) revealed that impulse buying depends on individual characteristics and environmental characteristics Individual characteristics represent the traits that remain relatively stable across situations Environment characteristics have also been found to influence impulse buying in that an individual may experience the urge to buy impulsively when he or she is stimulated by certain circumstantial

factors during a shopping interaction Following that, Muruganantham & Bhakat (2013)

suggested four set of factors influence impulsive buying include: (1) External stimuli, (2)

Internal Stimuli, (3) Situational and Product Related Factors, (4) Demographics and Cultural Factors External stimuli refer to marketing cues or stimuli that are placed and controlled by the marketer in an attempt to lure consumers into purchase behavior External Stimuli are related to the shopping and the marketing environment Internal Stimuli are related

Socio-to the different personality related facSocio-tors which characterises an individual rather than the shopping environment or stimuli Internal factors of impulse buying denote the individual’s internal cues and characteristics that make customers engage in impulse buying Situational predictors of impulse buying include the retail location, time of shopping, seasons and shopping habits The research found that the characteristics of consumers and their demographics influence the impulse purchasing Local market conditions and various cultural forces could also impact the way consumer; go for impulse purchasing Impulse buyers are less likely to consider the consequences of buying on impulse and less likely to thoroughly evaluate their purchase decisions than a typical informed shopper (Rook 1987) They are more willing to accept spontaneous buying ideas and are more focused on the immediate gratification of purchasing the product Impulse buyers are often drawn to a mysterious attraction of the product which motivates the buyer to purchase the item (Rook 1987)

The studies mentioned above contributed greatly to our understanding of impulse buying Although there are certain controversies related cause impulse buying, most of the research has come up with the following general points:

 First, impulse buying is an unplanned decision to buy a product or service, made just before a purchase

 Second, consumers are affected by both internal and external factors of impulse buying Impulse buying is a result of a purchaser’s immediate reaction to external stimuli and will not the same due to consumer’s characteristics

2.1.2 Classification of impulse buying

Stern (1962) classified impulse buying into four types: pure, reminder, suggestion and planned Consistent with the preceding definition, a pure impulse purchase occurs when an individual makes an unplanned purchase after exposure to a stimulus This type of impulse

purchase is characterized by a total lack of planning before the purchase occurs, and represents a novelty purchase that breaks a normal buying pattern In an online context, a customer without an a priori shopping goal, and deciding to purchase a book on tiki.vn would

be considered a pure impulse purchase Secondly, a reminder impulse purchase occurs when

an individual makes a purchase only after being prompted by seeing the product or some other relevant cue The individual did not plan to make a purchase until he or she remembered a previous experience with or a need for the product when exposed to it For instance, a reminder impulse purchase would be if an individual purchases a perfume after seeing it on the website and realizing that he or she is running out of that product.In contrast to a reminder impulse purchase, a suggestive impulse purchase occurs when an individual visualizes a need for a product after seeing it for the first time (i.e., the individual had neither prior knowledge

of nor desire for the product) For instance, an unplanned purchase of a new product made at www.amazon.com based on the recommendations of the website would be considered a suggestive impulse purchase Finally, a planned impulse purchase is when an individual does not plan a purchase, but searches for or takes advantage of promotions The individual goes into a shopping environment with a shopping list, but has the intention of making purchases based on coupons or promotions For instance, such a purchase would result if an individual visited www.nike.com on Black Friday in search of good deals In this situation, an individual enters a shopping environment with little to no knowledge of certain products and no explicit intention to buy them, but may very well purchase them based on the terms of the deal (low price, free accessories, etc.) The common thread across these different types of impulse purchases is the unplanned nature of the behavior, whereby the individual buys the product impulsively after being exposed to This paragraph aims to enhance the knowledges of impulse buying base on Stern research

2.1.3 Impulse buying model

The researcher will review some famous model involves impulse buying to help us have a clear picture of factors affecting impulse buying

2.1.3.1 Churchill and Peter (1998)

According to Churchill and Peter (1998), impulse buying behavior is affected by both internal and external factors Churchill and Peter’s model also describe the impulse buying process by omitting several steps, such as need recognition, information search, and alternative evaluation The impulse buying process starts with product awareness Impulse buyers begin browsing without having an intention to purchase a certain item or visiting a certain store As consumers browse, they are exposed to the stimuli, which triggers customers’ urge to buy on impulse When impulse buyers feel the desire to buy, they make a purchase decision without searching for information or evaluating alternatives Then, consumers may experience positive or negative consequences by the post-purchase evaluation after the purchase on impulse In this process, consumers are influenced by internal (mood/need/desire, hedonic pleasure, cognitive/affective evaluation) and external factors (visual merchandising, window display, in-store form display, floor merchandising, promotional signage) that trigger their impulse purchase behavior These factors provide information regarding new products, fashion trends or coordination tips

Figure 2.1: Churchill and Peter’s model of Impuse buying process

Source: Churchill and Peter (1998)

2.1.3.2 Impulse buying model of urban customers in Vietnam

Nguyen Thi Tuyet Mai et al (2003) conducted an exploratory study that included both qualitative and quantitative methods to provide a general understanding of urban Vietnamese consumers’ impulse buying behaviors Results show that individualism, age, and income are significantly related to impulse buying behaviors of Vietnamese consumers In addition, personal-use products are the most common impulse purchase items, despite the collectivist nature of consumers in Vietnam The authors’ findings suggest that, at least with respect to impulse buying and despite cultural differences, consumers from transitional economies such

as Vietnam may share some common tendencies and behaviors with consumers in advanced economies

2.2 Online Impulse Buying

Most of researchs in online impulse buying was conduct in 2000s when the internet and e-commerce is booming But the number of research in online impulse buying is very limited because online buying is a new field with lots of differences compared to traditional buying Preceding research on online impulse buying give us the following points: Donthu and Garcia (1999) found online shoppers to be more impulsive than non-online shoppers This result of this research was confimed by later research of LaRose (2001) and Koski (2004)

LaRose (2001) indentified features of a website like product recommendations, suggested items, price point categories, notice of sales, etc That would encourage unregulated buying (which includes impulse buying) Costa and Laran (2003) have modeled quantitatively the experiences and consequences of internet impulse buying, suggesting that online environment affects the level of impulsiveness, in-store browsing and the occurrence of impulse purchases, as well as a relationship between impulse purchases and positive emotions Besides, Koski (2004) identified five features of online websites that encourage impulse buying One, shopping online provides anonymity; consumers can shop impulsively without embarrassment Two, the internet provides easy access; consumers can make a purchase 24/7 Third, the internet provides a greater variety of goods Fourth, direct marketing and personalized promotions lead consumers to impulse buying Fifth, consumers can use credit cards online that encourages impulse purchases Likewise in a more recent study on

impulse buying online, Rhee (2006) found that online impulse buyers showed significantly higher involvement with apparel and a more positive evaluation of the website attributes in terms of website design, product presentation, promotion and product search/policy information Zhang et al (2006) in their study about the online impulse purchase suggest that both consumer’s inherent trait (gender) and environment characteristic (subjective norms) have positive impact on impulse buying Depends on previous studies, Dawson and Kim (2009) in their research about cues on apparel websites that trigger impulse purchases has found two categories of external impulse buying cues present on apparel websites that entice people to impulsively buy Such cues include various sales promotions, gift with purchase, free shipping, contests or sweepstakes, easy return policies, or idea cues including new styles, featured items, top picks, and gift ideas to Malee a few The findings of the study suggest that online shoppers may value different types of external cues on a web site more than others Promotional offers and purchase ideas were desired the most However, some researchers considered orther internal factors As mentioned above, Wells et al (2011) suggested that impulse buying depends on individual characteristics and environmental characteristics The study found that individuals who frequently engage in impulse purchases often share common personality traits and characteristics Individual characteristics include age, hedonic shopping motivation, self-discrepancy and impulsiveness Environment factors have also been found to influence impulse buying in that an individual may experience the urge to buy impulsively when he or she is stimulated by certain circumstantial factors during a shopping interaction

In addition, Chaudhuri (2015) proved the impact of hedonic shopping motivation and demographic characteristics (age, income and gender) on the customers in the impulse buying behavior

The preceding reviews suggested two set of factors affecting impulse buying include: consumer’s characteristics (age, income, gender, hedonic shopping motivation, impulsiveness) and environment’s characteristics (website, promotion, features related to online buying) However, most of preceding research only investigate one or two factors that affecting impulse buying There is no comprehensive study on this issue Another point is that

no study have been conduct in Vietnam market Therefore, it is necessary to evaluate and

select appropriate factors that affecting online impulse buying in Vietnam In the next part, researcher will propose the study’s hypothesis and build the conceptual model based on available literature and studies

2.3 Factors affecting online impulse buying

2.3.1 Impulsiveness

Impulsiveness or consumer’s impulse buying tendency has been defined as “both the tendencies to experience spontaneous and sudden urges to make on-the-spot purchases and to act on these felt urges with little deliberation or evaluation of consequence” (Beatty and Ferrell, 1998) Another definition from study of Rook and Fisher (1995), impulse buying tendency or impulsiveness was defined as “a consumer’s tendency to buy spontaneously, unreflectively, immediately, and kinetically” Impulsiveness has received considerable attention from researchers in both traditional and online shopping contexts Wells et al (2001) found that impulsiveness will act as a precursor variable of online impulse buying behavior Another study of Zhang et al (2006) found that impulsiveness has also been found to positively influence the intention to shop online Wood (1998) believes that the core definition

of impulse is weakness of will These kinds of consumers make decisions using unplanned, careless thinking, often followed by affection or emotional status The final decisions are usually against optimal judgment An individual who rated higher on the impulsiveness scale have been found to be more likely to experience urges to buy impulsively and to act on these urges (Dholakia, 2000) These kinds of consumers are weak-willed (Wood) Compared to low impulsivity consumers, high impulsivity consumers easily connect external information to internal emotion, incurring impulse buying Therefore, this study assumes that high impulsivity consumers will have more online impulse buying behavior than will low impulsivity consumers Based on the above arguments, researcher propose the following hypothesis:

H1: Impulsiveness has positive impact on online impulse buying

2.3.2 Electronic word of mouth

After Arndt (1967) clearly pointed out that word of mouth is an important variable influencing consumers’ decision-making and behavior, word of mouth really caused the attention and in-depth research of scholars in the field of marketing With the development of Internet, word-of-mouth spread to network space, forming online word of mouth, online word of mouth is also known as electronic word of mouth (eWOM) The power of WOM to influence consumers’ decision-making processes has long been known to researchers and practitioners;

it has recently become even more important with the advance of the internet Product review websites, retailers’ websites, brands’ websites, personal blogs, message boards and social networking sites are all examples of the types of eWOM

In traditional shopping environment, the impulsive buying behavior is generally regarded as a behavior caused by environmental stimuli, personal traits, time, budget and so

on But there are a lot of difference between the network retail background and traditional retail background In the context of online buying, consumers can't touch and try products, but they can make up the defects through the commodity display, buyers’ use experience, and the product recommendation system As the auxiliary decision-making reason increasing, consumers will have more courage to make a buying decision Chatterjee (2001) first proposed that online reviews made possible impact on consumers shopping from a marketing perspective Chatterjee thinks that with a high transparency of network information, consumers can research any relevant product information based on their require, and then make their buying decisions, which takes more advantage than traditional word of mouth whether in the accessibility, scope, source and time And he believes that online comments will affect the receiver's cognition, beliefs, attitudes and actual decisions Moreover, LaRose (2001), as one of the earliest researchers of the online impulse buying, pointed out that product comments, suggestions and promotion can promote the non-binding network purchase QinWu (2009) confirmed that online reviews are an important dimension affecting online impulse buying behavior, and he also confirmed that the form, the date and the content of the online comments will significantly impact the online impulse buying Ya-ping Chang (2012) suggested that the number of degree of online reviews may stimulate consumers online impulsive buying when they read positive comments Recently, Y Huang et al (2013) found

that Electronic Word-of-Mouth tends to increase consumers’ merchandise awareness and has significant effect on consumer behavior So, based on the above arguments, researcher propose the following hypothesis:

H2: Electronics word of mouth has positive impact on online impulse buying

2.3.3 Hedonic shopping motivation

Hedonic shopping motivation is influence by an individual’s hedonic consumption needs Hedonic shopping motivation was defined as a need to satisfy an individual subjective fun, and pleasure when shopping According to Arnold and Reynolds (2003), hedonic motivation is categorized to six categories Maleely adventure shopping, social shopping, gratification shopping, idea shopping, role shopping, and value shopping According to Cinjarević and Petric (2011), adventure shopping, gratification shopping, idea shopping, and value shopping has the most effect on impulse buying behaviour on consumers The findings indicated that consumers engaged in impulse buying behaviour because they see it as a stimulation to feel excited and self-fulfilled, to feel better and to pampered oneself, to keep

up with the latest trends, technological innovations, and fashions in the market, and to get the best deals in the market Other than hedonic motivation, experts also mentioned that utilitarian motivation is also one of the reasons customers involve in shopping While hedonic motivation explains more about customers’ feelings, fun and pleasure fulfilments when shopping for goods and services, utilitarian motivation explains more about customers’ purchasing decisions that is deemed to be useful, wise, rational, and foolish when shopping for goods and services Customers who are influenced by utilitarian motivation usually purchase goods on a regular basis such as food, clothing, toiletries, and many other necessity goods, whereas customers who are influenced by hedonic motivation purchase goods on less than a regular basis such as luxury goods, and other functional goods

As both hedonic and utilitarian motivations are both involve in customers’ decision making, however, in this research, we would be only focusing on hedonic motivation because utilitarian motivation has not been an area of focus for impulse buying in past researchers (Cinjarevic, Tatic, and Petric, 2011; Kim and Eastin, 2011) Hedonic motivation is most

relevant for this research because it explores customers’ feelings and emotions when shopping From these points of view, we can build the following conceptual hypothesis:

H3: Hedonic shopping motivation has positive impact on online impulse buying

2.3.4 Convenience orientation

In the marketing literature, the concept of convenience was introduced by Copeland (1923), who referred to convenience goods as those that the consumer purchases frequently and immediately at easily accessible stores Much of the literature on consumer convenience

in a traditional retailing environment has revealed two factors of primary importance in delivering convenient service to customers: timesaving and effort minimization efforts Berry

et al (2002) have concluded that the greater the time costs associated with a service, the lower the degree of consumers’ perceived service convenience They have further posited that consumer perceptions of convenience are negatively influenced by their perceptions of the cognitive, physical, and emotional effort associated with the shopping effort

Convenience orientation is defined as consumers’ attitudes or perceptions towards saving time and effort related to planning, buying orusing products or services According to Fitch (2004), there is an increasing importance of convenience orientation in the consumer’s buying behavior and store patronage The Internet serves as a convenient shopping channel, and can be seen as an alternative impulsive channel The increased convenience in online shopping compared to traditional brick and mortar shopping is advantageous to many shoppers, such convenience may also encourage impulse buying Although, there are many studies conducted to examine the impact of convenience orientation on buying behavior (Fitch, 2004; Jones et al., 2003), but, just a few studies consider the impact of convenience orientation on impulse buying Moreover, there is no study was conduct in the online context Study of Hansen and Olsen (2015) has proved a significant direct influence of convenience orientation on impulse buying in online context Therefore, it is necessary to examine the relationship between convenience orientation and online impulse buying We have the following hypothesis:

H4: Convenience orientation has positive impact on online impulse buying

2.3.5 Sales promotion

According to many researchers (Dholakia, 2000; Sandy Dawson and Minjeong Kim, 2009; Peter Hulten and Vladimir Vanyushyn, 2014), sales promotion is an important external stimulus to trigger impulse buying in the context of e-commerce Online retailers provide diverse sales promotions, such as free gifts, discounts, or free shipping to attract shoppers to their websites In online shopping, it is very likely that a shopper has no knowledge of certain products and no explicit intention to buy them, but may very well buy them, having been stimulated by the terms of the deal A promotion serves as an immediate economic incentive

to purchase a product Most online shoppers tend to believe that product prices in online stores are often lower than in physical retail Promotions are important to inform consumers of the availability of a product, to generate public awareness of the marketing activities of a retailer,

to encourage revisits to the retailer, and to increase buying behavior

In addition, the internet offers more opportunities for the retailer to target more specifically certain customers with direct marketing and with more personalized promotions (e.g by sending an e-mail suggesting certain new items based on the purchase history of the customer) In addition, the consumer can face a banner ad and be immediately transported to the site selling the product It has been suggested that this might increase impulse buying However, at the same time consumers are more in control of what marketing messages they see, so the effect of the increased possibilities of marketing promotions and direct marketing

on impulse buying is still controversial Thus, in this study, researcher eager to examine the impact of sales promotion on impulse buying with the following hypothesis:

H5: Sales promotion has positive impact on online impulse buying

2.3.6 Website quality

Cues from the environment have also been found to influence impulse buying in that

an individual may experience the impulse buying when he or she is stimulated by certain circumstantial factors during a shopping interaction (Youn and Faber, 2000) In a traditional

shopping context, marketers manipulate atmospheric cues in retail settings to trigger impulse purchases (Rook and Fisher, 1995) Similarly, in an online context, several researchers have examined the characteristics of the online environment that lead to impulse purchases (e.g., Adelaar et al., 2003; Kukar-Kinney et al., 2009; Parboteeah et al., 2009) Such environmental cues often manifest themselves as various website characteristics that influence the consumer’s behavior Eroglu and colleagues (2001) proposed a categorization of these characteristics, such that the online environment consists of Task-relevant cues and Mood-relevant cues

Task-relevant cues include “all the site descriptors which facilitate and enable the consumer’s shopping goal attainment” Because these cues are crucial in the completion of

the shopping task, we will refer to them as Task-relevant cues Examples of Task-relevant

cues include merchandise description and navigation aids that directly facilitate the consumer’s task Prior research has identified Task-relevant cues that likely play a major role

in an online context For example, the top priority of any online user when completing online transactions has been found to be security Download delay is also an important Web characteristic because Web users are unwilling to wait for more than a few seconds for a response from a website In the pre-purchase stage, ease of navigation is crucial in determining which websites users normally commit to or abandon There are various web characteristics that can be classified as Task-relevant cues The intention of this review is not

to offer an exhaustive list of Task-relevant cues but to suggest that websites have these cues, and they may vary in how they are presented to and perceived by online users

In contrast, Mood-relevant cues are crucial in creating “an atmosphere that has the potential to make the shopping experience more pleasurable”, but are “relatively inconsequential to the completion of the shopping task” (Eroglu et al., 2001) Thus, Mood-relevant cues can be used to create a mood at a website to influence an online user’s emotion and, ultimately, his or her shopping behavior In other words, while these cues do not directly affect the fulfillment of a shopping task, they may increase the hedonic value of the online

experience Given the importance of these cues in creating a mood at a website, we will refer

to them as Mood-relevant cues

Website quality, thus, depends on the presence of these various characteristics All websites contain Task-relevant and Mood-relevant cues at differing levels As such, a website that provides environmental cues (i.e., both high and low task-relevant cues) at a high quality level constitutes an online interface of high quality, while a website of poorer quality includes lower quality environmental cues High quality environmental cues have been found to influence online impulse buying (Parboteeah et al., 2009)

Based on preceding literature review, we can build the following conceptual hypothesis:

H6: Task-relevant cues (website quality) has positive impact on online impulse buying

H7: Mood-relevant cues (website quality) has positive impact on online impulse buying

2.4 Hypothesis & Research Model

Based on the preceding review, researcher extract the summary that there are five main factors influent customer’s online impulse buying include impulsiveness, electronic word of mouth, hedonic shopping motivation, convenience orientation, sales promotion and website quality (Task-relavent cues and Mood-relavant cues) The following hypothesis are proposed:

H1: Impulsiveness has positive impact on online impulse buying

H2: Electronics word of mouth has positive impact on online impulse buying

H3: Hedonic shopping motivation has positive impact on online impulse buying

H4: Convenience orientation has positive impact on online impulse buying

H5: Sales promotion has positive impact on online impulse buying

H6: Task-relevant-cues (website quality) has positive impact on online impulse buying

H7: Mood-relevant-cues (website quality) has positive impact on online impulse buying

This study will also examine the influence of other factors (age, gender, income…) to online impulse buying behavior Based on above literature reviews, the relationship between factors affect impulse buying behavior is briefly described in the following figure:

Figure 2.2: Research Model

2.5 Consumer’s characteristics

This study will also examine the influence of other factors (age, gender, income…) to online impulse buying behavior This group of factors will not be examimed as hypothesis The study takes and simple testing the effect of this group factor impact to online impulsive buying behavior

2.5.1 Gender

Gender is found as an important cause for impulse buying (Chien-Wen, 2010; Lai, 2010; Pentecost & Andrews, 2010; Chavosha et al., 2011; Bashir et al., 2013) Literature

identifies inconsistent results on the effect of gender on impulse buying There are studies that declare women as more impulsive in buying than men (Priyanka & Rooble, 2012; Kollat & Willett, 1967; Dittmar et al., 1995; Melnikas & Smaliukiene, 2007; Jalees, 2009; Virvilaite et al., 2009) On the other hand, some findings suggest that men show more impulse buying than women do because women carefully plan their purchases (Cobb & Hoyer, 1986; Mai et al., 2003) Still there are few who found no significant relationship between gender and impulse buying (Bellenger et al., 1978; Gutierrez, 2004; Ghani et al., 2011) This research focus on fashion product with the majority of clients are women Therefore, researcher is eager to examine the difference between genders to advance knowledge about online impulse buying

2.5.2 Age

Age is an individual characteristic that has been found to influence impulse buying, whereby younger people tend to be more impulsive than older people (Bellenger et al., 1978) Young people use the Internet for activities like schoolwork and socializing For many adolescents these days, online shopping is a rapidly growing phenomenon Today's multitude

of online access points and often, parental encouragement, allow adolescents to explore and

to learn as online shoppers Moreover, young people embrace technologies in general (e.g., cellphones, tablet, social networks) Not surprisingly, today's youth are skilled online consumers In the context of online shopping, the study of Hill and Beatty (2011) show the influence of age to impulse buying whereby young people tend to make more online impulse shopping than elderly do Therefore, researcher will also examine the difference between age group to advance knowledge about online impulse buying

2.5.3 Income

Previous studies suggest that higher income level is one of numerous factors, which accounts for advance stage of impulsive purchasing comparing America to many countries of the world (Abratt & Goodey 1990) The impulse buying is found as a superior for the consumers who can afford it “Income level positively influences on consumers” impulse purchasing behavior (Wells, Farley & Armstrong 2007) Consumer who wants to buy products is dependent on his/her income The consumers with higher income level are less

sensitive than consumers with lower income and consumers with higher income would mostly involve into Impulsive purchase (Butkeviciene, Stravinskiene & Rutelione 2008) According

to preceding arguments, it is reasonable to examine the impact of income to online impulse buying in this study

Summary

In this chapter, some literatures are reviewed concerning the impulse buying, online impulse buying and factors affecting online impulse buying Accordingly the existing researches employed various approaches to measure impulsive buying by customer However, the online impulse buying applied the development which is specifically designed for this particular context but has not tested in previous yet Therefore, this research measured

by six components such as: impulsiveness, electronic word of mouth, hedonic shopping motivation, convenience orientation, sales promotion, website quality, especially in fashion Vietnam market The relationship among these concept will be explain more detail in this chapter First of all, the researcher give the whole picture about impulse buying based on present theoretical foundations Then this research will be presented the developing impulse buying in online market and fashion product Following these opinions, a research model is set up with seven hypotheses:

H1: Impulsiveness has positive impact on online impulse buying

H2: Electronics word of mouth has positive impact on online impulse buying

H3: Hedonic shopping motivation has positive impact on online impulse buying

H4: Convenience orientation has positive impact on online impulse buying

H5: Sales promotion has positive impact on online impulse buying

H6: Task-relevant-cues (website quality) has positive impact on online impulse buying

H7: Mood-relevant-cues (website quality) has positive impact on online impulse buying

Besides, the researcher also consider characteristic of customer affect to online impulsive buying behavior With different gender, age, income and education, how these

characteristic impact to their intention

CHAPTER III: RESEARCH METHODOLOGY

This chapter presents brief description of the research methodology used for the research This includes the research process, research measurement, sample selection methods, data collection methods and data analysis methods

3.1 Research Process

The research process of this study is described in the following figure:

Figure 3.1: Research process

Firstly, research problem was defined, and then research objective and research questions were identified to be the target of solving defined research problem After that, this study conducted a literature review to review some relevant theories about factors affecting impulse buying behavior to build the model and hypothesis for this research From this, a preliminary questionnaire was developed based on measurement used in some previous studies In the next step, the research will have 2 sub-steps: Qualitative research and Quantitative research

3.2 Qualitative research

Based on literature from previous research about the factors affecting impulse buying

in fashion products in Vietnam, the researcher proposed seven hypotheses which were proposed in Chapter 2 After that, the author adjusted the model and selected the preliminary the scale for questionnaire of the study After finishing the preliminary questionnaire, the researcher conducted the indepth interviews with 10 people in Ho Chi Minh City to obtain the correct items in the context of Vietnamese consumers, check the content and meaning of words used in the initial measurement scales and modify them to be more suitable and understanding Although most of the measures of the constructs were mentioned in the previous literature, this step is necessary to make them appropriate and easy to understand in the context of studying During the interview, the researcher had received some significant feedback and suggestions from the interviewees to make the improvement for the official questionnaire

Qualitative research were conduct by researcher (with help from two colleagues) at a coffee shop in district 1 – Ho Chi Minh City Interviewees were selected from researcher’s company staff and last year students based on the interview script prepared in advance The duration of meeting is 2 hours Interviewed participants were divided into two types The first type is officers with 3 from mobile game company and 2 others officers who study MBA at ISB with the researcher The second type is student with 5 students were from the University

Of Economic Ho Chi Minh City All interviewers have age from 18 to 35 and financial independence Among these participants, there were 7 of them have had online purchases

action and three have never tried The guideline for qualitative in-depth interview was predetermined and put in Appendix 1 Researchers would be an active instructor and suggest for participants can understand easily Interviewees gave a rough idea of their personal opinions about the questions in the script Some of them criticized the previous ideas, gave the question and new ideas until all of participants could completely understand the script The researchers summarized the censures and assure that the contents reach an agreement between the interviewees

The findings of the indepth interview with the agreement of the people interviewed about some of the content, indicated that they have confirmed that the elements such as: Electronic word of mouth, Convenience orientation, Hedonic shopping motivation, Sales promotion, Task-relevant cues, Mood-relevant cues, Impulsive Buying Behavior in this study are meaningful and necessary for the results of online impulsive buying However, the scale can measure some things was not in concordance with Vietnam's market The researcher need

to be amended to according to Vietnam's conditions

Based on the qualitative research findings, measurement scales were modified before being ustilized for main survey in quantitative research Impulsiveness consisted of 4 items Electronic word of mouth included 6 items Convenience orientation contained 7 items Hedonic shopping motivation comprised 11 items Sales promotion scale encompassed 5 items Task-relevant cues and Mood-relevant cues were the same with 3 items for any one Finally Impuse Buying Behavior was measured by 3 items Based on the literature, the researcher setted up the survey instrument, using scales that were already validated in previous studies Impulsiveness was adapted from Rook and Fisher (1995) and modified through four items Electronic word of mouth will be measured by six items according to Eugenia Y Huang et al (2013) Convenience orientation was adapted from Mathieson (1991) with seven items Hedonic shopping motivation will be measured by eleven items according

to Babin, Darden and Griffin (1994) Sales promotion scale was adapted from Alkharabsheh

et al, 2011; Lai and Vinh, 2012 with five items Task-relevant cues and Mood-relevant cues

are the same and will be measured by three items according to Loiacono et al (2007) Finally Impuse Buying Behavior was adapted from Parboteeah et al., (2009) with three items

Table 3.1: Measurement scale

Impulsiveness - four items according to Rook and Fisher (1995)

IPS1

IPS2

IPS3

IPS4

- “Just do it” describes the way I buy things

- I often buy things without thinking

- “I see it, I buy it” describes me

- “Buy now, think about it later” describes me

Electronic word of mouth - six items according to Eugenia Y Huang et al (2013)

- I often read the eWOM to ensure that I can buy the right goods or brand

- When I do not know or do not know much on a product, in order to increase the understanding of it, I will read some of the product eWOM

- I often use the eWOM information to help me make the best choice of goods

- I frequently read the experience of others share on the network before I buy

- I think that most of the eWOM information is credible

- When the eWOM content of product more consistent, the more I believe these eWOM information

Convenience orientation - seven items according to Mathieson (1991)

- Online shopping would provide me on time delivery

- Online shopping provides me with product information & other customs feedback

- Online shopping allows me ordering product easily

- Online shopping allows me to obtain information on product easily

- Online shopping would provide me with information 24-hours a day

- Online shopping provides me with more value than money that spends

- Online shopping provides me in-depth information

Hedonic shopping motivation - eleven items according to Babin, Darden and Griffin (1994)

- Shopping to me is truly a joy

- I shop not because I have to, but because I want to

- Shopping is like an escape from my daily routine life

- The time spent in shopping is truly enjoyable to me

- I enjoy being immersed in exciting new products while shopping

- I enjoy shopping for its own sake and not because of that I need to purchase something

- While shopping, I am able to act on the spur of the moment

- While shopping I can feel the excitement of the hunt

- While shopping, I am able to forget my other problems

- While shopping I feel a sense of adventure

- Any shopping is a very nice time out to me

Sales promotion - five items according to Alkharabsheh et al, 2011; Lai and Vinh, 2012

PR1

PR2

PR3

PR4

- Information about sales promotion on my most favorite online retailer’s website is accurate

- Information about sales promotion on my most favorite online retailer’s website is very fast

- Information about sales promotion on my most favorite online retailer’s website is clarifies and details

- Information about sales promotion on my most favorite online retailer’s website is attractive

- PR5 Information about sales promotion on my most favorite online retailer’s website is useful

- Information on my most favorite online retailer’s website is effective

- My most favorite online retailer’s website adequately meets my information needs

- The information on my most favorite online retailer’s website is pretty much what I need to carry out my tasks

Mood-relevant cues - three items according to Loiacono et al (2007)

LTR1

LTR2

LTR3

- My most favorite online retailer’s website is visually pleasing

- My most favorite online retailer’s website displays visually pleasing design

- My most favorite online retailer’s website is visually appealing

Impuse Buying Behavior - three items according to Parboteeah et al., (2009)

to distribute to respondents

3.3.2 Data collection method

When the questionnaire was designed properly, the main survey was conducted widely

by using many methods such as sending online survey through Google Docs, email, social network, or sending the hard copy of survey directly to online customer at university school and 3 Coopmart super market in district 7, district 1 and district 3 Data collection was expected to be done within two weeks later

After that, collected data was cleaned and used to test reliability of scale and validity

of questionnaire through Cronbach’s alpha coefficient and Exploratory Factor Analysis (EFA) method Multiple regression method was used to evaluate the hypotheses which the implication and finding were stated and reported

3.3.3 Sample size

The result of many study suggested that the size of the sample depends on the method

of estimate the sample According to Hair et al (2010), a general rule, the sample size should

be 100 or greater and the minimum sample is 5 observations for each scale The model in this study consisted of 8 factors with 42 scales so that the minimum sample size should be: 42*5

= 210 observations

For standard multiple regression analysis, the required sample was recommended by Tabachnick and Fidell (1991) should be n>50+8m (where m=number of independent variables) There were 7 independent variables in this research Hence, the minimum sample required to run multiple regression in this study is n > 50+ 8*7= 106 observations

In this study, to fulfill the preceding requirement, the researcher expected to collect data from 400 customers This sample size was appropriate for EFA and multiple regression analysis Sampling was conducted based on convenience sampling All respondents were asked to know about buying fashion products online before answering the questionnaire

3.3.4 Data analysis method

SPSS Version 20 (Statistical package for Social Science) was used to analyze the collected data in which Cronbach’s alpha reliability analysis, EFA and multiple regression analysis function were enabled to support this research

3.3.4.1 Descriptive analysis

Descriptive analysis was used to describe general view of the sample characteristics,

in which the mean scores of the measurement scales were calculated to show customers’ assessment on different facets influencing online impulse buying Using 5-point Likert scale,

when the score was equal to 3 referred to acceptable/neutral, the score was greater than 3 was considered good or agreement, whereas when the score was lower than 3, it was considered not good and need to be improved or as an disagreement

3.3.4.3 Exploratory Factor Analysis (EFA)

The primary objectives of EFA was to determine the number of factors affecting the measures and the strength of the relationship between each factor and each observed measure (DeCoster, J., 2004) In this research, Principal Component Analysis (PCA) was used as a method to extract the factors with Varimax as a rotation technique

The result was considered to be acceptable when following conditions were met (Pallant, 2005):

 The sample size should be equal to or greater than 150, and there should be at least five cases for each variable In this research, 47 variables are used, hence the required minimum sample size for EFA is 235 The valid responses are 270, therefore data of this research were considered valid for EFA

 Factor analysis was appropriate to data if:

 The Kaiser-Meyer-Olkin value (KMO) is 0.6 or greater

 The Bartlett’s test of sphericity is statistically significant: p < 0.05

 The number of factors was determined when:

 The components have an eigenvalue of 1 or more

 The total variance explained by these components should be above 50%

 Factor loading criteria should be 0.5 or more to ensure a practical significance