Research Proposal

Electronic Commerce Models and Technologies

Kusworo Anindito

(5929496 / Ph.D-IT)

VINCENT MARY SCHOOL OF SCIENCE AND TECHNOLOGY

2017

The Influence of Technology, Social Interaction and Internal Factors on Impulse

Buying Behavior in Social Commerce in Indonesia

(Kusworo Anindito – ID: 5929496)

1. Introduction

Social commerce is an evolution of e-commerce where the activities and transactions

of e-commerce are conducted by utilizing social media technology (Lu et al, 2016). The social

media is also used by communities to interact, rate products, review other opinions, and share

experiences and recommendations on products and services (Shanmugam et al, 2016). The

interactive and social experience are used by consumers in making purchase decisions so that

both are essential to developing successful social commerce (Wang & Yu, 2017). The social

interactions also encourage consumers on these platforms to purchase impulsively (Xiang et

al., 2016).

Impulse buying is increasingly common in Indonesia. Nielsen stated that in 2011,

consumers in Indonesia who never bought goods outside the shopping list were only five

percent (Ramaun, 2011). Moreover, 21 percent of the consumers never made a shopping list at

all and 39 percent said that they always buy additional items. It is very interesting for producers

and sellers to know how to take advantages of the behavior of Indonesian consumers who tend

to purchase impulsively.

Currently, research on online impulse buying in Indonesia is very rare, likewise

research that explores the effect of social interaction on impulse buying behavior in social

commerce in Indonesia. Therefore, this study aims at how technology, social interaction and

internal factors influence the behavior of impulse buying in social commerce in Indonesia.

2. Literature Review

Impulse buying is a purchase that is done without a deep consideration of the reasons

why the product or service was purchased. There are two main components of impulse buying:

the process is unplanned and emotion is more dominant in making purchases than logical

reasoning (Verhagen & Dolen, 2011). Xiang et al. (2016) defines impulse buying as an

unplanned purchase, the result of a stimulus exposure, and decides on the spot. Impulse buying

occurs when a customer has an urge to buy a specific product without deeply considering the

motives and effects of the purchase (Huang, 2016). In social commerce, members' decision to

buy products are influenced by the community through online interaction (Shim & Altmann,

2016).

Intensive study of impulse buying, an unplanned purchase, was first conducted by

DuPont Company that examined purchases by customers in supermarkets in 1948-1965.

Impulse buying is categorized by Stern (1962) into four different types, namely pure, reminder,

suggestion, and planned. Pure impulse buying is a totally unplanned and without consideration.

A reminder impulse buying occurs when a customer sees an item and remembers if he or she

needs it. Suggested impulse buying occurs when a customer sees a product for the first time

and imagine a need for it, even though he or she has no knowledge of the item being purchased.

Planned impulse buying occurs if the customer makes a purchase based on special prices,

discounts, coupons, and the like.

Social commerce is a subset of e-commerce that involves customers in generating

content using social media through online communities, forums, reviews, recommendations,

and ratings. (Hajli, 2015; Hajli & Sims, 2015). It integrates social media in an e-commerce

platform, where social factors play an important role (Hajli & Sims, 2015). There are three

major attributes of social commerce: social technologies, community interactions and

commercial activities (Lu et al., 2016; Hajli, 2014). There are two ways to adopt social

commerce in business. First, expand the existing e-commerce website by using social media in

interaction with customers. Second, using the specific features for commercially provided by

social media (Hajli, 2014). Social commerce provides benefits to consumers because they can

share a product or service, provide opinions and recommendations. Companies or sellers also

benefit because they can develop strong relationships with their customers, promote, and know

the needs of products and services from customers.

Xiang et al (2016) conducted a study on impulse buying in social commerce based on

the Stimuli-Organism-Response (SOR) framework previously conducted by Parboteeah et al

(2009). They also added an important factor in social commerce: social relations, in this case,

parasocial relationship. The study showed that visual information and attraction features will

affect perceived usefulness and affective (perceived enjoyment) of the consumer, which in turn

will affect urge to buy impulsively. The study also produced evidence showing that parasocial

interaction affects perceived enjoyment and impulse buying tendencies that ultimately affect

urge to buy impulsively. Figure 1 shows the model proposed by Xiang et al (2016).

Figure 1. The model proposed by Xiang et al (2016)

Choi and Qu do a study to determine the effect of scarcity message in social commerce.

They develop a model of customer value-customer satisfaction-customer loyalty framework by

adding scarcity messages as determinants and urge to buy impulsively between customer value

and customer satisfaction. The study shows that scarcity messages will affect the customer

value (utilitarian value and hedonic value) which will subsequently affect urge to buy

impulsively, customer satisfaction, and finally customer loyalty. Figure 1 shows the model

proposed by Choi and Qu (2016).

Figure 2. The model proposed by Choi and Qu (2016)

Huang (2016) stated that research on impulse buying in social commerce was still

small, and even then very rarely pay attention to social factors. He made a study of impulse

buying and its influencing factors, namely flow and social capital. The study showed that peer

communication influenced by social capital affected urge to buy, which in turn affected

impulse buying. The study also showed that browsing activities influenced by content

attractiveness also affected the urge to buy that in turn affected impulse buying. He found that

SOR paradigm is suitable to be used in impulse buying and that social capital is more important

than content attractiveness. Figure 3 depicts the research model proposed by Huang.

Figure 3. The model proposed by Huang (2016)

A study conducted by Shim and Altmann (2016) was based on Theory of Plan Behavior

(TPB). They believed that external factors (such as marketing) and internal factors (such as

characteristics, as well as affective and cognitive factors) influenced the desire to buy

impulsively. The study showed that external factors influenced attitude and urge to buy

impulsively. The study also showed that attitude, subjective norm and perceived behavioral

controls influenced urge to buy impulsively. They concluded that price discounts and product

differentiation had a greater impact on the desire to buy impulsively than promotion. But large

discounts for luxury goods might not attract consumers to buy because of perceived behavioral

control factors. Figure 4 shows the research model proposed by Shim and Altmann.

Figure 4. The model proposed by Shim and Altmann (2016)

3. Research Model and Hypotheses

Someone who sees an interesting item often has a desire to buy the item without further

consideration. Furthermore, actual purchase tends to be done to fulfill this desires. (Huang,

2016). Therefore, some previous studies measured urge to buy impulsively rather than impulse

buying behavior (Chung et al., 2017; Huang, 2016; Xiang et al, 2016; Parboteeah et al., 2009)

like the relationship between intention and behavior in the technology acceptance model.

Content quality, information that accurate and visual appeal, is very important for users.

Better information for customers and visual appeal can increase the level of user believe that

he or she can perform activities in social commerce well and make he or she more enjoy in

doing the activities (Xiang et al, 2016; Huang, 2016). Thus, the following hypotheses are

proposed:

H1 : information fit-to-task has a positive effect on utilitarian value in social

commerce.

H2 : information fit-to-task has a positive effect on hedonic value in social

commerce.

H3 : visual appeal has a positive effect on utilitarian value in social commerce.

H4 : visual appeal has a positive effect on hedonic value in social commerce.

Scarcity messages are often used for promotions by emphasizing the existence of

special prices in limited time or quantities. Scarcity messages can affect customer value

(utilitarian and hedonic) and intention to buy impulsively (Choi & Qu, 2017). Hence, the

following hypotheses are proposed:

H5 : scarcity messages have a positive effect on utilitarian value in social

commerce.

H6 : scarcity messages have a positive effect on hedonic value in social commerce.

H7 : scarcity messages have a positive effect on urge to buy impulsively in social

commerce.

Integration of social media into e-commerce activities puts social relationships into an

important factor in social commerce (Xiang et al, 2016; Huang, 2016). Social capital refers to

resources in a social relationship that can provide economic value. There are two categories of

social capital: social bridging and social bonding. Individuals in social bridging get the value

with little emotional support in a relationship. Otherwise, social bonding involves emotionally

close relationship (Huang, 2016). Individuals in both social bridging and social bonding can

gain broader information and opportunities from the community. The social capital influences

the individuals to involve in peer communication. Thus following hypothesis is proposed:

H8 : social bridging has a positive effect on peer communication in social

commerce.

H9 : social bonding has a positive effect on peer communication in social

commerce.

Technological developments enable customers to search, view, compare, buy, and

deliver product more easily. Customers believe that he or she is able to do commerce activities

will increase the possibility of such customers to make impulse buying (Xiang et al, 2016;

Cheng & Wang, 2016; Rezaei et al, 2016; Choi & Qu, 2017). Customer who enjoys in using

social commerce will tend to explore a specific product that may increase urge to buy

impulsively (Xiang et al, 2016; Cheng & Wang, 2016; Rezaei et al, 2016; Zhou, 2016; Chung

et al, 2016; Choi & Qu, 2017). Confidence to be able to do all commerce activities with a

comfortable and safe will also increase the enjoyment in using social commerce (Xiang et al,

2016). Hence, the following hypotheses are proposed:

H10 : Utilitarian value in using social commerce has a positive effect on hedonic

value.

H11 : Utilitarian value in using social commerce has a positive effect on urge to buy

impulsively.

H12 : Hedonic value in using social commerce has a positive effect on the urge to

buy impulsively.

During communication in the community, consumers learn and share new information,

opinion, knowledge, and purchase behavior. This learning process can influence consumers’

desire to purchase impulsively (Huang, 2016). Thus, the following hypothesis is proposed:

H13 : peer communication has a positive effect to urge to buy impulsively in social

commerce.

Social pressure in the form of opinions of people around the customer to his or her

actions affects his or her desire to make purchases impulsively (Shim & Altmann, 2016). Thus,

the following hypothesis is proposed:

H14 : subjective norm has a positive effect to urge to buy impulsively in social

commerce.

The limitations that a customer has, such as time or money, also can influence his desire

to buy impulsively (Shim & Altmann, 2016). Hence, the following hypothesis is proposed:

H15 : perceived behavioral control has a positive effect to urge to buy impulsively

in social commerce.

Figure 5 depicts the research model of this study. There are seven exogenous variables

that affect other variables but not influenced by any variable (information fit-to-task, visual

appeal, scarcity messages, social bridging, social bonding, subjective norm, and perceived

behavioral control); three intervening variables (utilitarian value, hedonic value, and peer

communication); and one independent variables (urge to buy impulsively). It shows that urge

to buy impulsively is determined by utilitarian value, hedonic value, peer communication,

subjective norm, and perceived behavioral control. Information fit-to-task, visual appeal, and

scarcity messages affect utilitarian value and hedonic value. Peer communication is influenced

by social bridging and social bonding.

Utilitarian Value

Hedonic Value

Visual Appeal

Information Fit-to-Task

Urge to buy impulsively

H1

H4

H2

H3

H10

H12

Peer Communication

Social Bridging

Social Bonding

H13H8

H9

Scarcity Messages

H5

H6

H11

Subjective Norm

Perceived Behavioral

Control

H14

H15

H7

Figure 5. Proposed Research Model.

4. Research Methodology

Research procedure and methods planned to use in this study are as follow:

1. Development of a proposed theoretical model

Based on prior studies about impulse buying and social commerce, a theoretical model

is developed. Variables and their definition, and causal relationship among the variables

are defined.

2. Development of a questionnaire

A structured questionnaire is developed to measure the variables of the theoretical

model and to determine a personal profile of respondents. The questionnaire is prepared

in both English and Bahasa Indonesia languages.

3. Sampling procedure

The target population exceeds 100,000, therefore, to meet the 95 percent confidence

level with a precision of 5 percent, then the minimum size of the sample is 400

(http://www.webcitation.org/66kKEIC0b). The respondents are Indonesians who are at

least 17 years old and have experience using social commerce. The distribution and

collection of questionnaires are done online and offline. Google Form is used as a tool

to conduct online surveys. While the offline survey is conducted by distributing the

questionnaire to several cities in Indonesia.

4. Data preparation and preliminary descriptive analyses

There are steps to prepare and analyze the data of questionnaire responses:

a. Data Entry, Missing Values, and Outliers.

b. Construct validity.

c. Internal consistency reliability.

d. Preliminary descriptive analysis.

5. Analysis and development of the final model

Analysis and development of the final model are conducted using Structural Equation

Modeling (SEM) technique using SPSS and Amos software.

6. Interpretation of the results and conclusions

Finally, the results of the analyses are interpreted regarding the relationship of findings

and prior studies, any new findings, theoretical and practical implications, and

suggestions for future research. Limitations of the study are discussed.

5. Expected Contribution

This study is expected to contribute to research by providing a valid model that can be

used to learn about impulse buying that involves technology, community, external stimuli, and

internal factors from consumers. This study is also expected to contribute to practice by

providing strategic suggestions to companies or the sellers on how to make more customers

who make purchases impulsively to increase their profits. Instead, this study also provides

suggestion to consumers on how to avoid impulsive purchases that might be disadvantageous

them.

6. Future Research

The study will focus on social commerce with members who have the same position (peer), no

famous figures who have a very strong influence on his fans (parasocial). Future studies can

be done by comparing the magnitude of the effect of comments from well-known figures versus

close friends or family so that sellers can make a better strategy for their business.

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