Consumer Preferance Towards Online Grocery Stores

Consumer Preference Towards Online Grocery Retail Sreerupa Sarkar (FPB 1719/048)
INDUS BUSINESS ACADEMY

LAKSHMIPURA, THATAGUNI POST
KANAKPURA MAIN ROAD
BENGALURU 560062 , INDIA
www.iba.ac.in
A Research Report on “Consumer Preference Towards Online Grocery Retail’’

A Project Report for the partial fulfilment of the requirement for
Post Graduate Diploma in Management
Subject: Market Research
Under the supervision of
Dr. Vaishali Agarwal , Indus Business Academy , Bengaluru
Submitted by
Sreerupa Sarkar
FPB1719/048, Indus Business Academy, Bengaluru, India
Mobile: +918961022027 Email:fpb1719.048.sreerupa@gmail.com
Signature of Project Supervisor

Dr. Vaishali Agarwal
For Academic purpose only Page | 1

Declaration
I, Sreerupa Sarkar hereby declare that the project report entitled “Consumer Preference
Towards Online Grocery Retail” ” submitted in partial fulfilment of requirements for the
degree of Post-Graduate Diploma in Management (PGDM) of Indus Business Academy,
Bangalore is my original work and not submitted anywhere else for award of any
degree/diploma /fellowship any other similar title in any other institute or university
(Signature)
Name of the Student: Sreerupa Sarkar
Registration No: FPB1719/048
Date:

Acknowledgement
I find myself much obliged to express my profound sense of gratitude for the guidance and
support of so many people throughout my project. It is my pleasure to acknowledge their
contribution.
I would like to thank our CEO , Mr. Manish Jain and Dean, Dr. Subhash Sharma, Indus
Business Academy , Bangalore for being so encouraging and helpful throughout my report on
“Consumer preference towards Online Food and Grocery Retail”. I am grateful to all for
their constant support and encouragement throughout my market research course.
I express my sincere thanks to my mentor Mr. Manish Jain and Dr. Vaishali Agarwal whose
continuous guidance throughout the project inspired me to accomplish it.

Director Certificate
This is to certify that Ms. Sreerupa Sarkar is a bona fide student of Indus Business Academy,
Bangalore and is presently pursuing Post Graduate Diploma in Management.
Under my guidance she has submitted her project report titled “ Consumer preference
towards Online Grocery Retail” in partial fulfilment of requirement for the Term paper of
3rd Trimester project. This report has not been previously submitted as part of another degree
or diploma of another Business school or University.
Dr. Subhash Sharma

Director
Indus Business Academy,
Lakshmipura, Thataguni Post,
Bangalore-62
India

Mentor’s Certificate
This is to certify that Ms. Sreerupa Sarkar is a bona fide student of Indus Business Academy,
Bangalore and is presently pursuing Post Graduate Diploma in Management.
Under my guidance she has submitted her project report titled “ Consumer preference
towards Online Grocery Retail” in partial fulfilment of requirement for the Term paper of
3rd Trimester project.
To the best of my knowledge this report has not been previously submitted as part of another
degree or diploma of another Business school or University.
Mr. Manish Jain (CEO)

Mentor
Indus Business Academy,
Lakshmipura, Thataguni Post,
Bangalore-62
India

Contents
1. Executive Summary .......................................................................................................................... 7
2. Introduction ....................................................................................................................................... 8
2.1 What is E Commerce? ................................................................................................................ 8
2.2 Purpose of Study ......................................................................................................................... 8
2.3 Outline of Study .......................................................................................................................... 8
3. Background ....................................................................................................................................... 9
3.1 Why is there a need to know customer buying preference?.................................................... 9
3.2 Key drivers for success of E commerce ....................................................................................... 10
4. Review of Literature ....................................................................................................................... 10
4.1 Abstract.......................................................................................................................................... 10
4.2 Online Grocery retail: .............................................................................................................. 12
Online Grocery Shopping: ............................................................................................................. 13
4.3 Benefits of Online Grocery Shopping: .................................................................................... 13
4.4 Disadvantages of Online Grocery Shopping ........................................................................... 13
4.5 How Does Online food and grocery Shopping Work? .......................................................... 14
4.6 Indian players in the online grocery retail.............................................................................. 14
5. Research Plan .................................................................................................................................. 16
5.1 Research Objectives:- ............................................................................................................... 16
5.2 Research Scope:- ....................................................................................................................... 16
5.3 Gap Analysis .............................................................................................................................. 16
5.4 Research Design and Methodology ......................................................................................... 17
5.5 Sampling .................................................................................................................................... 17
5.6 Sample unit:- ............................................................................................................................. 17
5.7 Sampling Technique:- ............................................................................................................... 17
5.8 Hypothesis.................................................................................................................................. 18
Hypothesis 2..................................................................................................................................... 18
6. Analysis and Findings ..................................................................................................................... 18
7. Summary.......................................................................................................................................... 38
7.1 Limitations ................................................................................................................................. 38
7.2 Major Findings .......................................................................................................................... 38
7.3 Future Scope .............................................................................................................................. 39
APPENDICES ..................................................................................................................................... 40
Bibliography ........................................................................................................................................ 45

1. Executive Summary
Internet and Technology have made tremendous contribution towards business witnessed
nowadays all over the world. This has given rise to E commerce which encompases several
pre purchases activities leading to an exchange of products or services or information over
electronic system such as the internet and other telecommunication networks.
Analysing the competitive advantage it can be said that E commerce enables easier , faster
and efficient business transactions for its consumers. For developing countries like India and
many more , E commerce offers considerable opportunity for growth.
E commerce is a boon for the current economic downturn. As India’s E-commerce market is
worth about Rs 50,000 crores in 2012. About 80% of this is travel related (airline tickets,
railway tickets, hotel bookings, online mobile recharge)
Online retailing comprises about 15% . India has close to 11 million online shoppers and it is
growing at an estimated 40-45% per annum. The rapid growth of E commerce in India is
being driven by greater customer choice and improved convenience.
The project will first study the attitudes of customers towards online shopping, also
determining the factors which influence the consumer to purchase goods and services.
The project also depicts the attributes of online shopping influencing the purchase decision of
the respondent.It will also determine the issues regarding the online shopping.
The project determines the purchase decision with respect to grocery. It will determine the
place preference of grocery shopping with respect to price, quality, variety, proximity and
offers, discounts.

2. Introduction
2.1 What is E Commerce?
Information communication technology and the Internet have contributed in changing the
concept of business these days. There is paradigm shift of business model witnessed today all
over the world. The proliferation of internet has given birth to E business and subsequently E
commerce. While E commerce is confined to a transaction, E business encompasses several
pre purchase and post purchase activities leading to the exchange of products or service or
information over electronic systems such as the internet and other electronic mode including
telecommunication networks. Analysing the competitive advantage of E commerce it is
observed that it enables easier, faster and efficient business transactions compared to outdoor
shopping. It helps in developing low- costs leadership in existing markets and introduces
product differentiation and mass customisation. For a developing country like India E
commerce offers considerable opportunity for growth.
E commerce has entered almost every section of business and has influenced the retail sector
in a ways that had not been done earlier. The spread of Internet in remote corners of
developed as well as developing countries have proved to be conducive for a steady growth
of online market and commerce. The unserved and underserved sections of the society have
benefitted from it and have got the privilege to access a broader choice of commodities and
service.
2.2 Purpose of Study

India’s e commerce market is worth about Rs 80,000 crore in 2014 about 80% of this was
travel related ( airline, tickets, online phone recharge, hotel bookings etc) Online retailing
comprises about 15% . India has close to 10 million online shoppers and is growing at an
estimated 40-45% per annum. The rapid growth of e commerce in India is being driven by
greater customer choice and improved convenience.
2.3 Outline of Study

The project was undertaken to study the factors that influence the buying behaviour of
consumers towards online food retail compared to physical store in India. It had the following
objectives:-

 To study the attitudes of customers towards online shopping.

 To identify factors influencing consumer’s online purchase decision of goods and
services.
 To identify issues related to online shopping from the customers point of view.
 To study the place preference of of grocery and food shopping with respect to price,
quality, variety, proximity and offers, discounts.
3.Background
In today’s world where in urban areas 80% of the people are working there is a need to find
the required grocery and food stuff in just one click. Many still prefer to go to physical stores
and purchase such items keeping in mind the freshness and authenticity of the goods and also
factors such as physical examination of goods etc. This method of selling online grocery and
food items was started by Grofers and Big basket and now since Amazon has also received a
big nod from the government to enter into the food retail there is severe competition.
It has become very important for any company in this market to know the perceptions of
its customers, especially the urban people in this segment as they are always busy, running
after money and hardly get the time to shop for groceries and prefer buying these stuff
through online mode rather than outdoor shopping..
3.1 Why is there a need to know customer buying preference?

In today’s world the customer has been playing the vital role in deciding the role of the
company and also its existence in the market. There have been times where the company has
not worked towards the needs, likes and dislikes of a customer. So the companies need to
have a report of the changing likes and dislikes of the customer regularly, and work
accordingly to completely fulfil the satisfaction of the customers which can only be done by
surveys and various other methods. Hence knowing the customer buying preferences is very
much important.

3.2Key drivers for success of E commerce

Reduction in operational costs as the entire business can be moved online, the need for
physical stores has become obsolete. Less infrastructural investment and associated labour
costs drives up the profit margins. It is far easier and quicker to compare prices online,
arming the customer with the information to decide the right price for themselves. With
services like COD, the customers can trust the process of going online and purchasing.
Market penetration also becomes far more achievable with e-commerce , it is possible for a
merchant in Mumbai to extend his reach to North Eastern or even rural villages that are now
connected by the online network.
E commerce facilitates shopping anytime , anywhere and for almost anything desired. Busy
consumers prefer this to the restrictions of when a mall is open and the need to physically
travel to shop. Online businesses takes shopping a step further by taking itself to the
customer creating conveniences of shopping anywhere and at anytime.
In India with increasing propensity of social media, businesses have now begun to engage
their customers on social networking portals such as Facebook. These are likely to be rapidly
developing marketing channels for the future.
4. Review of Literature
Customer preference towards online retail is the most important and trending talks because in
today’s very busy world people mostly in tier one cities hardly have the time to go and shop
in the physical stores, they prefer goods being delivered at their doorstep, the online food
retail need to develop their good and services according the need of the customers.
4.1 Abstract
Factors influencing online shopping: An Empirical Study in Ahmedabad,

Shahir Bhatt and Amola Bhatt; Nov 2012, Vol. 11 Issue 4, p51-65,15p
According to an Indian online landscape study (July,2010), the number of active internet
users in India stands at 262 million , of which 40 million are online shoppers indicating a
growth of 70% from the previous year. The statistics alone are enough to denote the potential
of e-commerce in India. However as the online market becomes crowded with players,
businesses need to have an edge in terms of customer satisfaction to gain a larger market
share. With the above mentioned objective in mind, a preliminary survey of online shoppers
was conducted in Ahmedabad and consumer perceptions were analysed using factor analysis

and Analysis of Variance (ANOVA) test. The paper has found that ease/attractiveness of
website, service quality of website and website security are the three main dominant factors
which influence consumer perception regarding their online purchasing experiences. Hence,
businesses which focusses on the three factors can attract more clicks. Also the paper has
proved that these factors are related to the various types of consumers classified as trial,
occasional, frequent and regular (based on their frequency of purchase). The authors have
found that regular buyers are most influenced by ease or attractiveness of website and service
quality of website while occasional buyers value website security more than categories of
consumers.
Get Inside the Lives of Your Customers: Harvard Business Review, Seybold PB,May 2001,
Vol.79 Issue 5, p80-89
Over the last decade, many companies have become adept at the art of customer relationship
management. They’ve collected and sifted mountains of data on preferences and behaviour,
divided buyers into ever-finer segments, and honed their products, services, and marketing
pitches. But something’s been missing from these efforts: the big picture. Few companies
have bothered to look carefully at the broad context in which customers select, buy, and use
products and services. They’ve been so focused on fine-tuning their own offerings that
they’ve failed to see how those products and services fit into the real lives of their customers.
As a result, companies have routinely missed chances to expand sales and deepen loyalty.
As a result, consultant Patricia Seybold maintains, they’ve routinely missed chances to
deepen loyalty and expand sales. In this article the author shows how effective three very
different companies have been at using customer scenarios as the centrepiece of their
marketing plans. Chip maker National Semiconductor looked beyond the purchasing agents
that buy in bulk to find ways to find ways to make it easier for engineers to design National’s
components into their specifications for mobile telephones. Each time they do so , it
translates into millions of dollars in orders. By developing a customer scenario that describes
how people actually shop for groceries, Tesco learned the importance of decentralising its
web shopping site and how the extra costs of decentralisation could be outweighed by the
higher profit margins online customers generate. And Buzzsaw.com—have used customer
scenarios as the centrepiece of their marketing plans, guiding the way they deliver value and

use the Internet to buttress and extend their customer relationships supplier to its customers.
Seybold lays out the steps managers can take to develop their own customer scenarios by
thinking broadly about the challenges your customers face she suggests you can almost find
ways to make their lives easier and thus earn their loyalty.
Consumer Perception of E-service quality,Dr. Zhilin Yang , Minjoon Jun,Huntsville, Vol 19,
Issue 1:- This exploratory study expands the knowledge concerning service quality
dimensions in the context of Internet commerce, from the differing perspectives of two
groups: Internet purchasers and Internet non- purchasers. Six primary service quality
dimensions perceived by internet purchasers were uncovered: Reliability, access, ease of use,
personalisation, security, responsiveness, . When examining the relative importance of each
dimension affecting overall service quality assessment, the “reliability “ factor was found to
be the most important dimension for Internet purchasers while Internet non-purchasers
consider “security” as their most critical concern.
The Internet commerce industry has gone through an initial period of focussing on new
customers to the present stage of both retaining and attracting customers. Instant price
comparisons on the Web, brought by powerful engines, make non price competitive
advantages, such as service quality, ever more critical in retaining and attracting customers.
What brings online customers back , primariy is a sense of loyalty that comes from an
Internet company’s offering better service than anyone else.
To offer better services, it is necessary for internet companies to investigate what existing
and potential customers expect for product/service quality. In the context of Internet
commerce, existing customers are those whp have utilised the internet as a channel to
purchase products and services.
4.2Online Grocery retail:

This market refers to the e-commerce companies where they sell groceries and food items
through online mode. Eg-: Amazon, Grofers, and Bigbasket

Online Grocery Shopping:

Providing that no sector of retail market is safe from online shopping revolution, it is now
possible for the humble hometown grocery store to become digitized and available on your
smartphones, tablet or computer. No longer checkout lines, counting the number of items to
see if you qualify for the express lane, forgetting your grocery list at home, or carrying heavy
bags up your front steps. Online grocery shopping is dramatically changing the customers
relationships with the food market and making a service that may have once felt luxurious
into an everyday convenience.
4.3 Benefits of Online Grocery Shopping:

The primary benefit of online grocery shopping is that it is very convenient. By ordering
online, one can quickly search for the products she needs and order them without having to
physically walk through miles. It also saves travel expenses and time going to the grocery
store. Considering the wide availability of the internet, it also means grocery shopping can be
done from remote locations or in the middle of doing other tasks. It is also very useful for
those who do not own a vehicle or may be physically unable to move around easily, since the
food is delivered right infront of their doors. Today online grocery stores are increasing in
popularity as more and more people become comfortable with using the internet is increasing
the purchases.
4.4Disadvantages of Online Grocery Shopping

Perhaps the biggest disadvantages of online grocery shopping is that it costs extra money,
since food must be delivered and that the food ordered is not obtained immediately. If
someone were making a certain recipe and discovered he needed an additional ingredient, he
would probably not be able to order it online and get it quickly enough to finish his dish. In
the same way it forces a person to plan his food buying in advance of when he will need if
deliver will take a day or two of essential foods available before he runs out. Another
disadvantage is that online shopping forces the customers to be home during a certain period
to collect the food when it is delivered. Also, online grocery stores will often only cover
specific delivery areas.

4.5How Does Online food and grocery Shopping Work?
Following is the basic parameter that determines the working of online food shopping.
Creating the website

The most important part of online grocery shopping is the website itself. The website should
have a complete list of groceries that are able to be delivered as well as the price of each item.
This website should then have a shopping cart where a user can add items to a list of things to
be ordered, as well as view and edit items that she is planning to purchase. Finally, this
website should have the ability for the user to enter her address and pay for the order.
Filling the Order and Shipping
The next step is to take the submitted order and use it to collect and deliver the items on the
list. In general, fulfilment of the grocery and food order needs to be done manually by a stock
boy or other employee. This process can be made easier by having a well organised room
where the products cans be easily and efficiently located. The stock person should also check
to make sure the items placed in the order match the list that the user created.
Then , once the order has been completed the collection of foods needs to be placed in a
vehicle and delivered to the customer.
Restocking and Processing Payments Clearly

It is essential to know for the customers that all the items listed on the website are in stock
and able to be shipped.As a result the stock rooms needs to be carefully checked to ensure
inventory levels are sufficient. Also, it is important to have the ability to obtain and process
payments made by credit card. Also in order to encourage repeat customers it can be helpful
to require customers to have a user name which would allow information to be stored. This
can also help customers create carts of items they oftenly purchase.
4.6Indian players in the online grocery retail
Bigbasket.com:
Bigbasket.com (Innovative Retail Concepts Private Limited) is India’s largest online food
and grocery store. With over 18,000 products and over a 1000 brands in our catalogue you
will find everything you are looking for. Right from fresh Fruits and Vegetables, Rice and
Dals, Spices and Seasonings to Packaged products, Beverages, Personal care products, Meats
– they have it all.Bigbasket.com allows you to walk away from the drudgery of grocery
shopping and welcome an easy relaxed way of browsing and shopping for groceries.
Grofers:
Grofers is an Indian on-demand online grocery delivery service. It was founded in December
2013 and is based in Gurgaon.Grofers is a low-price online supermarket that gets products
across categories like grocery, fruits & vegetables, beauty & wellness, household care, baby
care, pet care and meats & seafood delivered to your doorstep. Here customers can choose
from over 5,000 products at prices lower than supermarkets every day and schedule delivery
are also as per the customers convenience.
Amazon:-
Amazon is one of the biggest e-commerce industries and it recently entered the online food
retail segment in India named Amazon Fresh. It provides a wide range of food products at
best prices, they also provide two hour delivery of products such as fruits and vegetables.
They deal with all kinds of gourmet food, daily essentials, cooking, beverages, mushroom,
truffles and many more.
Farm2kitchen.com:-
Farm2kitchen team is led by Seema Dholi (founder and CEO) , a woman entrepreneur who is
committed to the betterment of the lives of Indian families . She started Farm2kitchenwith
only one mission – to enhance the quality of lifer Indian families. It deals with only organic
groceries. They support organic farming and agriculture as organic farming is a holistic
approach to food production. Some of the cities which will be covered under Farm2kitchen’s
umbrella for organic food are- New Delhi, Mumbai, Bangalore, Kolkata, and Gurgaon.
Nature’s Basket:-
Godrej Nature’s Basket is India’s pioneering and premium food destination from the 119-
year young Godrej Group. They started in 2005 as a single store in Mumbai and has now
transformed itself into an omni-channel retail business. They are present through physical
retail stores across India in neighbourhoods, this combined with an online portal and a mobile
application.

Their aim is to redefine India’s freshest and finest food experience by sourcing and serving
the very best be it the freshest fruits & vegetables, authentic delicatessen, the finest meats,
irresistible bakery products and more. For them their customers’ needs come first and to
serve them better and offer the best in terms of quality, benefits, flavour and taste they have
grown and nurtured their brands over the years.
5.Research Plan
5.1 Research Objectives:-

 To study the attitudes of customers while shopping online.
 To identify the issues faced by the customer while shopping online.
 Identify the parameters which influence the purchase behaviour of the online food
retail.
5.2Research Scope:-
 To determine which factor influences the consumer to go for online shopping.
 To find out which feature of the company attracts the user to purchase the product
from the e-store.
 To find out whether the grocery online shopping is beneficial for the user.
 To analyse which factors influence the user to buy online grocery.
5.3Gap Analysis
Thepresent research is proposed to study and analyse the factors which influence the
behaviour of consumer with respect to online grocery in Bangalore. Studies on analysis of
consumer’s behaviour found from time to time. The studies have given a mixed outcome
which at times were positive and at times negative. In view of this there is ample scope for a
new study to analyse and study the consumer’s behaviour. The revelation from survey of
literature make it evident that consumers are becoming more and more aware about online
grocery services and there is a trend and a will among them to go for it. A study on this
aspect is necessary to update the knowledge regarding the same.

5.4Research Design and Methodology

The sources of data used in this Market research will be both primary and secondary data.
 Primary data- It will consist of original information gathered from a sample of

around 70-75 respondents residing in Bangalore, India.
 Secondary data-It consists of information that already exists and that which was
collected in the past for some other purpose.
5.5 Sampling
Sampling Design
 Sample size- The sample size selected for the research is 75 in the area of
Bangalore.
 Parameters of interests-The major parameter of interests is the subgroup of people
who are professional workers , students and engaged in self- service as they prefer
buying most of their goods online and have an experience in online grocery
shopping.
5.6 Sample unit:-

 Working people (men and women)
 Housewives
 College students
 Senior citizens
5.7 Sampling Technique:-
Quota Sampling-It is a method for selecting survey participants. In quota sampling, a

population is first segmented into mutually exclusive subgroups, just as in stratified sampling.
Then judgement is used to select the subjects or units from each segment based on a specified
proportion.

5.8 Hypothesis
Hypothesis 1
Null Hypothesis:-Consumers face less inconvenience in online retail.
Alternate Hypothesis:- Consumers face more inconvenience in online retail.
Hypothesis 2
Null Hypothesis:- Consumers prefer online retail as they get better value for money.
Alternate Hypothesis:- Consumers prefer offline retail as they get better value for money.
Hypothesis 3
Null Hypothesis:- Consumers prefer online retail as they get better value for money.
Alternative Hypothesis:- Online retail is not more beneficial as it does not provide so many
value proposition.
6.Analysis and Findings
Demographic Observations
Gender
Male 47 Female 28 Total 75

Interpretation
The above diagram depicts that out of the 75respondents 37.3 % of the respondents were
females and 62.7% were men as our objective was to know the consumer behaviour of both
men and women as to infer from it, it’s necessary to know the response of both the genders.
Age Brackets
Age Respondents
18-24 28
25-30 33
31-39 7
40 and above 10
Figure: Age Distribution of Sample

Age
10
7 28
18-24
25-30
31-39
40 & above
33
Interpretation
The above diagram illustrates that the maximum number of respondents were aged 18-24 and
then 25-30 as this is the age group where people are more tech savvy and prefer buying
things online instead of stepping out.
Occupation
Occupation Respondents
Student 16
Service 35
Homemaker 9
Business 18
Figure: Occupation distribution of sample

40
35
30
25
20
15
10
0
Business Homemaker Service Student
Interpretation
The above diagram illustrates that the maximum number of respondents are service and
business people and the rest are homemaker and students. As our goal was to study mostly
the behaviour pattern of these groups because they are the one’s running after money and find
it hard to take out time for grocery shopping and prefer doing it online.
Questionnaire Analysis
Q1) Which items you shop online?
Graphical Representation:-

Interpretation-
 The above diagram shows that electronics highest item sold in the online shopping.
 Apparels and food has the second highest number of transactions in online shopping.
 The other items that are sold in the online shopping are music , games and other
mostly preferred by male respondents.
Q2) Where do you prefer to buy your groceries from?
Always Ocassionally Never

Local Kirana 25 28 8
Sabzi Mandi 23 29 7
Supermarts 35 28 5
Online Sites 19 30 15
Others 7 17 29

Interpretation
 Respondents have mostly agreed that they shop most from Super marts then from
local kiranas and sabzi mandis.
 The figure above also illustrates that the people are mostly inclined to buy in Super
Marts and they still at times prefer to shop food and grocery items online.
Q3) If given an option to buy groceries online, would you like to buy?
No. of Respondents
Yes 49
No 8
May be 18
Interpretation
The figure above illustrates that majority have agreed to buy groceries online if they had an
option and a least number have disagreed to it.

Q4) How much money you spend in online shopping ?
Per purchase Daily Monthly

100-500 34 7 6
500-1000 12 8 28
1000-5000 8 7 36
5000 & above 6 4 28
Interpretation-
The figure above illustrates that the maximum number of respondents spend an amount of Rs
100-500 in their every purchase and an amount Rs 5000 and above monthly .
Q5) When do you feel the need to shop online?

Strongly Agree Neutral Strongly
Agree Disagree Disagree
When I want something unique 24 32 18 1 0

and physical
Value for money 29 39 5 2 0

When I don’t have the

time to buy in physical stores 31 34 9 1 0
Others 8 27 27 7 0
Interpretation
 The figure above illustrates the major reasons to shop online is when people do not
have the time to go and visit physical stores and they want value for money.
 The other reasons are when they want something unique and physical they prefer
shopping online
Q6) While shopping what satisfies you the most?

No. of Respondents
Cash on delivery 37
Credit/ debit card payment 3
Free shipping 21
Value of the product 12
Others2

Interpretation
 The above figure depicts that around 49.3% of the respondents feel that cash on
delivery satisfies them the most.
 The value of the products is the second most reason and 28% of the respondents
believe it. Then we have free shipping and credit/debit card payment which is found
to be satisfactory by rest of the respondents.
Q7) What issues do you face while shopping online?
Strongly Strongly
Agree Agree Neutral Disagree Disagree
No guarantee 19 27 19 3 7
Possibility of forgery 15 40 13 6 1
High price of products 15 21 27 10 2
Security Issue 8 32 24 9 2
Others 7 23 28 10 7

Interpretation
 Here, the majority of the respondents have said that the major issues they face while
shopping online is no guarantee.
 The second most reason is high price of products then the possibility of forgery.
 Very less people tend to have agreed to security reasons as one of the issues
Q8) Do you think buying grocery online is beneficial?
No. of respondents
Yes 40
No 10
May be 25

Interpretation
 The above figure illustrates that 53.3% people have agreed to online grocery retail
being beneficial to them.
 13.3% have disagreed to it.
 33.3% have said that may be it is beneficial or may be not.
Q9) If no, why do you feel so?

No. of Respondents
No authenticity 12
Stock out of items 12
Cash is not accepted 10
Unfreshness of the product 21
Others 20

Interpretation
The above figure illustrates the major reasons behind online grocery being considered not so
beneficial. The major reasons where 28% of the respondents have agreed is that they the
grocery items may turn out to be unfresh. 26.7% have mentioned other reasons for so . 16%
believe that there is no authenticity of the products and also there is a stock out of items the
rest 13.3% believe that the sites where cash is not accepted that is why they are not benefitted
from it.
Q10) Which of the following reasons describe your reasons for grocery shopping online?
Strongly Strongly
My preferred supermarket is
Faraway its easier for me as I 25 31 12 2 0
do not have to carry heavy
bags
It helps me to order 19 37 14 1 0
itemsin bulk
I do not own a vehicle so its 20 35 15 0 1

difficult for me
My local shopping centre 15 24 20 10 2

does not meet my needs
I am a working person so
online shopping is helpful 12 27 22 4 2
to me
Other reasons 10 21 20 8 5
Interpretation
 The above figure illustrates that around 25 of the respondents agree that one of the
primary reasons for them to shop online is that their preferred supermarket is faraway.
 20 respondents have agreed that they do not own a vehicle so they shop online.
 19 respondents believe that online grocery shopping helps them order in bulk.
 15 respondents feel that their existing supermarket is unable to fulfil their needs so
they prefer buying online.
 12 respondents agree that as they are working professionals they like buying online.

Q11) To what extent do you agree or disagree with the following statements?
Strongly Strongly
Online shopping help control

myspending habits 19 25 20 10 1
It is a much quicker/convenient
process than visiting the
supermart 17 45 9 4 0
Online shopping is too

much hassle I prefer to visit
the Supermart 16 36 10 5 8

Interpretation
The figure above illustrates that 19 respondents have agreed that online shopping also helps
them to control their spending habits. 17 respondents have agreed that it is a quicker and time
saving process and hence convenient to them. And 16 respondents have opposed as they
believe that buying in supermarts is more convenient for them.
Q12) Which of the following online grocery retailers you prefer?
Yes No Sometimes
Amazon 45 20 10
Grofers 20 35 20
Big Basket 41 16 18
Farm2kitchen 11 49 15
Others 17 41 17
Q13) From a scale of 1 to 5 how would you rate the online grocery sites? ( 1 being very poor
and 5 being excellent)
No. Of Respondents
1 (very poor) 0

2 (Poor) 3
3 (Satisfactory) 21
4 (Good) 32
5 (Excellent) 19
Interpretation
The above figure illustrates that a majority of 42.7% people have voted good to online
grocery sites.
28% have voted satisfactory to it.
Ho:- Consumers face less inconvenience in online retail

Ha:- Consumers face more inconvenience in online retail
Neither agree nor Strongly Strongly

Agree Disagree disagree agree disagree Total
No Guarantee 6 3 3 2 2 16
Possibility of
Forgery 3 4 2 2 3 14
High Price of
Products 2 3 3 1 1 10
Security Issues 3 3 1 3 2 12
Physical
Examination 2 4 2 2 3 13
Others 4 3 2 3 1 13
20 20 13 13 12 78

Table:As calculated value is lesser than table value so null hypothesis is accepted. This
Expected Value {(O-E)*(O-
Observed Value (O) (E) (O-E) {(O-E)*(O-E)} E)}/E
6 4.102564103 1.897435897 3.600262985 0.877564103
3 4.102564103 -1.102564103 1.2156476 0.296314103
3 2.666666667 0.333333333 0.111111111 0.041666667
2 2.666666667 -0.666666667 0.444444444 0.166666667
2 2.461538462 -0.461538462 0.213017751 0.086538462
3 3.58974359 -0.58974359 0.347797502 0.096886447
4 3.58974359 0.41025641 0.168310322 0.046886447
2 2.333333333 -0.333333333 0.111111111 0.047619048
2 2.333333333 -0.333333333 0.111111111 0.047619048
3 2.153846154 0.846153846 0.715976331 0.332417582
2 2.564102564 -0.564102564 0.318211703 0.124102564
3 2.564102564 0.435897436 0.190006575 0.074102564
3 1.666666667 1.333333333 1.777777778 1.066666667
1 1.666666667 -0.666666667 0.444444444 0.266666667
1 1.538461538 -0.538461538 0.289940828 0.188461538
3 3.076923077 -0.076923077 0.00591716 0.001923077
3 3.076923077 -0.076923077 0.00591716 0.001923077
1 2.00000000 -1 1 0.5
3 2.00000000 1 1 0.5
2 1.846153846 0.153846154 0.023668639 0.012820513
2 3.333333333 -1.333333333 1.777777778 0.533333333
4 3.333333333 0.666666667 0.444444444 0.133333333
2 2.166666667 -0.166666667 0.027777778 0.012820513
2 2.166666667 -0.166666667 0.027777778 0.012820513
3 2.00000000 1 1 0.5
4 3.333333333 0.666666667 0.444444444 0.133333333
3 3.333333333 -0.333333333 0.111111111 0.033333333
2 2.166666667 -0.166666667 0.027777778 0.012820513
3 2.166666667 0.833333333 0.694444444 0.320512821
1 2 -1 1 0.5
Calculated Value 6.96915293
illustrates the first hypothesis that in online retail consumers face lesser inconvenience
compared to physical stores.

Ho:- Consumers prefer online retail as they get better value for money.
Ha:- Consumers prefer offline retail as they get better value for money.
Value for Money

Agree Disagree Neither agree nor disagree Strongly agree Total
18-24 18 0 2 13 33
25-30 15 1 3 9 28
31-39 3 0 0 4 7
40 &
above 4 2 0 4 10
40 3 5 30 78
Rows 4
Coloumns 4
df 9
Alpha
Value 0.05
Table
Value 16.92
Observed Expected {(O-E)*(O-

Value (O) Value (E) (O-E) {(O-E)*(O-E)} E)}/E
18 16.92307692 1.076923077 1.159763314 0.068531469
0 1.269230769 -1.269230769 1.610946746 1.269230769
2 2.115384615 -0.115384615 0.013313609 0.006293706
13 12.69230769 0.307692308 0.094674556 0.007459207
15 14.35897436 0.641025641 0.410913872 0.028617216
1 1.076923077 -0.076923077 0.00591716 0.005494505
3 1.794871795 1.205128205 1.452333991 0.809157509
9 10.76923077 -1.769230769 3.130177515 0.290659341
3 3.58974359 -0.58974359 0.347797502 0.096886447
0 0.269230769 -0.269230769 0.072485207 0.269230769
0 0.448717949 -0.448717949 0.201347798 0.448717949
4 2.692307692 1.307692308 1.710059172 0.635164835
4 5.128205128 -1.128205128 1.272846811 0.248205128
2 0.384615385 1.615384615 2.609467456 6.784615385
0 0.641025641 -0.641025641 0.410913872 0.641025641
4 3.846153846 0.153846154 0.023668639 0.006153846
Calculated
Value 11.61544372
Table: As, calculated value is lesser than the table value, so the null hypothesis is accepted.
Ho:- Consumers prefer online retail as they get better value for money.

Ha:- Online retail is not more beneficial as it does not provide so many value propositions.
Satisfaction Variables
Cash on Credit/Debit Card Free Value of the Oth Tot
Delivery Payment Shipping Product ers al
18-24 20 0 7 5 1 33
25-30 10 2 3 12 1 28
31-39 4 0 1 2 0 7
40 & 4 2 1 3 0 10
Above
38 4 12 22 2 78
Rows 4
Columns 5
df 12
Alpha
Value 0.05
Table
Value 21.03
Observed Value {(O-E)*(O-

(O) Expected Value (E) (O-E) {(O-E)*(O-E)} E)}/E
20 16.07692308 3.923076923 15.39053254 0.957305852
0 1.692307692 -1.692307692 2.863905325 1.692307692
7 5.076923077 1.923076923 3.698224852 0.728438228
5 9.307692308 -4.307692308 18.55621302 1.993642721
1 0.846153846 0.153846154 0.023668639 0.027972028
10 13.64102564 -3.641025641 13.25706772 0.971852709
2 1.435897436 0.564102564 0.318211703 0.221611722
3 4.307692308 -1.307692308 1.710059172 0.396978022
12 7.897435897 4.102564103 16.83103222 2.131202131
1 0.717948718 0.282051282 0.079552926 0.110805861
4 3.41025641 0.58974359 0.347797502 0.101985734
0 0.358974359 -0.358974359 0.12886259 0.358974359
1 1.076923077 -0.076923077 0.00591716 0.005494505
2 1.974358974 0.025641026 0.000657462 0.000333
0 0.179487179 -0.179487179 0.032215648 0.179487179
4 4.871794872 -0.871794872 0.760026298 0.156005398
2 0.512820513 1.487179487 2.211702827 4.312820513
1 1.538461538 -0.538461538 0.289940828 0.188461538
3 2.820512821 0.179487179 0.032215648 0.011421911
0 0.256410256 -0.256410256 0.06574622 0.256410256
Table:As, calculated value is lesser than the table value, so the null hypothesis is accepted.

7.Summary
From the above data analysis we can conclude that consumer buys goods from the online
shopping website on the basis of factors like variety and value of online products, convenient
payment options such as cash on delivery or debit/credit card.
The hypothesis framed for the project Consumer Perception towards Online Grocery shopping
stores are beneficial for the consumer.
From the above data analysis it can be determined that most of the respondents would agree to
buy grocery online rather than shopping grocery the traditional way.
Out of the agreed respondents to buy online grocery most of the respondents think that it would
be beneficial to shop grocery online on the basis of factors like time saving, can be ordered in
bulk, better quality with reasonable price. We can also conclude by saying that there is a still
huge scope on online grocery to grow in India and research shows that it is already growing as
more and more consumers are being aware of it and showing an inclination towards online
grocery shopping.
7.1Limitations
The first limitation caused during the market research was to find out the respondents who
shop online and are web savvy.
The second limitation caused during the research was searching professionals who shop
grocery products along with the experience of online shopping.
Other limitation caused in the market research was that the research will only study the
consumer perception towards online grocery shopping and not the dealers, wholesalers,
retailers perception towards online shopping which acts as an agent to the online retail
industry to support its business operations.
7.2Major Findings
 From the collected data we can observe that there is an increase in the number of
respondents in online shopping as there is increasing awareness about this concept in
the market and the will to try it
 Certain parameters which motivates the user to shop online are:
 Cash on delivery
 Value of the product at a reasonable rate

 Various payment options
 Discounts and deals offered
 Physical examination is one of the primary issues in online buying which determines
the tangibility of the product
 The data depicts that supermarts are the preferred shopping destination where
customers prefer to buy their requirements as it offers all the basic aspects as price,
quality, variety etc
 From the above data collection we can determine most of the respondents agree to
buy grocery online if the option is given
 The data also determine the factors which are beneficial for the consumer to shop
grocery online which are variety, saves time and energy and avoids travelling and
waiting in long queues.
7.3 Future Scope

Experts have predicted a promising and glorious future for E commerce in the 21st century. In
the foreseeable future E commerce will further become a major tool for sale of commodities.
Day by day with the advancement of technology E shopping is becoming more natural and
popular. Simultaneously , severe rivalry in the sector of E commerce services will intensify.
Thus prevailing future trends of E commerce will be the growth of Internet sales and
evolution.
Each year number of E commerce service and deals grows largely. Sales volumes of online
stores are more than comparable with those of brick and mortar ones. And the trend will
continue as a lot of people who are burdened by work and household duties will avail the
services as it is time saving and saves efforts of actually having to go and shop.
The quantity to quality tendency of E commerce is also becoming more obvious as it has
removed geographical factors from sale (irrespective of where the seller is situated he can
sell) . To increase their customer base E store owners will have to strategise and plan
accordingly to pay more attention to such elements like appealing goods presentation,

attractive design , they will have to employ modern technologies for their business to become
parts of E commerce in future.
APPENDICES
Questionnaire on Online Grocery Store
Name:-
Gender:-
o Male
o Female
Age:-
o 18-24
o 25-30
o 31-39
o 40 and above
Occupation:-
o Student
o Service
o Business
o Homemaker
Q1) Which items do you shop online?
ALWAYS OCCASSIONALY NEVER

Apparel o o o
Electronics o o o
Food o o o
Games o o o
Music o o o
Others o o o

Q2) Where do you prefer to buy your groceries from?
ALWAYS OCCASSIONALY NEVER

o o
Local Kirana o
o o
Sabzi Mandi o
o o
Supermarts o
o o
Online sites o
Q3) If given an option to buy grocery online would like to buy?
o Yes
o No
o May be
Q4) How much money do you spend in online shopping? (Rupees)
Per Purchase Monthly Daily
100-500 o o o
500-1000 o o o
1000-5000 o o o
5000 & above o o o
Q5) When do you feel the need to shop online?

Strongly Agree Neither disagree Strongly

Agree agree nor disagree
disagree
When I want o o o o o o
something
unique and
physical
Value for o o o o o o
money
When I don’t o o o o o o
have the time
to buy in
physical
stores
Others o o o o o o
Q6) What features in online shopping attracts you?
o The design of a website

o Celebrities endorsing it
o Discounts offered
o Advertisement
o Variety of brands offered
o Others (please specify)
Q7) While shopping what satisfies you the most?
o Cash on delivery
o Credit/ debit card payment
o Free shipping
o Value of the product

o Others
Q8) What issues do you face while shopping online?
Strongly Agree Neither agree Disagree

Agree nor disagree Strongly
disagree
No guarantee
Possibility of
forgery
High price of
products
Security Issue
Physical
examination
Any other
Q9) Do you think buying grocery online is beneficial?
o Yes
o No
o May be
Q10) If no, why do you feel so?
o No authenticity
o Stock out of items
o Cash is not accepted
o Unfreshness of the product

o Others (please specify)
Q11) Which of the following reasons describe your reasons for grocery shopping online?
Strongly Agree Strongly Disagree
Agree Disagree
My preferred o o o o
supermarket is
faraway
Its easier for me as o o o o
I do not have to
carry heavy bags
It helps me to order o o o o
items in bulk
I do not own a o o o o
vehicle so its
difficult for me
My local shopping o o o o
centre does not
meet my needs
I am a working o o o o
person so online
shopping is helpful
to me
Other reasons o o o o
Q13) To what extent do you agree or disagree with the following statements?
Completely Agree Strongly Disagree

Agree Disagree

Online shopping help o o o o

control my spending
habits
It is a much o o o o
quicker/convenient
process than visiting the
supermart
Online shopping is too o o o o
much hassle I prefer to
visit a supermart.
Q14) Which of the following online grocery retailers you prefer?
Yes No Sometimes
Amazon o o o
Grofers o o o
Big Basket o o o
Farm2kitchen o o o
Others o o o
Q15) From a scale of 1 to 5 how would you rate the online grocery sites? ( 1 being very poor
and 5 being excellent)
o 1 (Very poor)
o 2 (Poor)
o 3 ( Fair)
o 4 (Good)
o 5 (Excellent)
Bibliography
Reference books-
Marketing Management by Philip Kotler

Basics Of Marketing By Dr. P.C Pardeshi
Web links-
https://papers.ssrn.com/sol3/papers.cfm?abstract_id=2285350
https://surface.syr.edu/ischool_other/57/
Reference Links
IUP journal of marketing management

Journal of Business Strategies



Consumer Preferance Towards Online Grocery Stores

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Consumer Preference Towards Online Grocery Retail Sreerupa Sarkar (FPB 1719/048)

INDUS BUSINESS ACADEMY

A Research Report on “Consumer Preference Towards Online Grocery Retail’’

Signature of Project Supervisor

For Academic purpose only Page | 1

For Academic purpose only Page | 2

For Academic purpose only Page | 3

Dr. Subhash Sharma

For Academic purpose only Page | 4

Mr. Manish Jain (CEO)

For Academic purpose only Page | 5

For Academic purpose only Page | 6

For Academic purpose only Page | 7

2.2 Purpose of Study

2.3 Outline of Study

For Academic purpose only Page | 8

 To study the attitudes of customers towards online shopping.

3.1 Why is there a need to know customer buying preference?

For Academic purpose only Page | 9

3.2Key drivers for success of E commerce

Factors influencing online shopping: An Empirical Study in Ahmedabad,

For Academic purpose only Page | 10

For Academic purpose only Page | 11

4.2Online Grocery retail:

For Academic purpose only Page | 12

Online Grocery Shopping:

4.3 Benefits of Online Grocery Shopping:

4.4Disadvantages of Online Grocery Shopping

For Academic purpose only Page | 13

4.5How Does Online food and grocery Shopping Work?

Creating the website

Restocking and Processing Payments Clearly

4.6Indian players in the online grocery retail

For Academic purpose only Page | 15

5.1 Research Objectives:-

For Academic purpose only Page | 16

5.4Research Design and Methodology

 Primary data- It will consist of original information gathered from a sample of

5.6 Sample unit:-

5.7 Sampling Technique:-

Quota Sampling-It is a method for selecting survey participants. In quota sampling, a

For Academic purpose only Page | 17

Alternate Hypothesis:- Consumers face more inconvenience in online retail.

6.Analysis and Findings

For Academic purpose only Page | 18

Figure: Age Distribution of Sample

For Academic purpose only Page | 19

Figure: Occupation distribution of sample

For Academic purpose only Page | 20

Q1) Which items you shop online?

For Academic purpose only Page | 21

Q2) Where do you prefer to buy your groceries from?

Always Ocassionally Never

For Academic purpose only Page | 22

For Academic purpose only Page | 23

Q4) How much money you spend in online shopping ?

Per purchase Daily Monthly

Q5) When do you feel the need to shop online?

When I want something unique 24 32 18 1 0

Value for money 29 39 5 2 0

For Academic purpose only Page | 24

When I don’t have the

Q6) While shopping what satisfies you the most?