E-PaymentsMIS304

Section 01Group 5

Claudia LopezNicole Sarmiento Arseney Woloschuk Michael BerberTommy Bito

Introduction Management Information Systems can improve the efficiency and effectiveness of business processes when technology is in alignment with the company's objectives. Strong business-IT alignment is when the business IT’s function directly supports business goals and to ensure business-information technology are closely aligned (Rainer & Prince 2017 60). Some of the characteristics of great business-IT alignment are when organizations view IT as a tool to continually transform the business by creating new revenue streams and consider customer service functions as an essential part of business objectives (Rainer & Prince 2017 60). One of the business processes that can improve revenue streams and address customer service function is by providing multiple E-payment methods. According to an article titled, How Electronic Payment Works, “A customer is more likely to return to the same e-commerce site where his or her information has already been entered or stored.” (Hord 2005)E-payment methods have become more popular over the years because it offers convenience and ease of use to conduct financial transactions. Over

the last decade, technological advancement provides more options on how to pay for goods and services, but it makes it more difficult for businesses to alight their IT payment systems and their business needs with customers’ e-payments method usage. The topic chosen for our research study is E-payments: Preference and Usage by the CSUSM community. We decided to research this topic because we want to determine if CSUSM businesses have a tight business-information technology alignment.Research ObjectivesThe purpose of this study is to collect, organize, and analyze quantitative and qualitative data by conducting in-person and online surveys on the CSUSM campus to 155 participants. Secondary sources, such as online research articles and in-class textbooks, as well as industry expert interviews, will be used to provide insight into business owners' perspectives. The survey questions include demographic questions such as age, gender, marital status, employment, and income level, types of e-payment methods the consumers have heard of, consumers' e-payments usage, and frequency. The industry expert interview questions include current job position, how e-payments affect the business operation, advantages and disadvantages of e-payments, barriers to offering different e-payment systems, and short subjective description of e-payment systems from the interviewees.

Survey responses will be evaluated and assessed for possible patterns and correlations that may affect the participants’ e-payments preferences and usage. The answers will be analyzed by computing all data and using descriptive statistics such as graphs and charts to represent quantitative and qualitative information. The results from the primary data and secondary sources will be used to formulate recommendations to CSUSM business owners on how to improve their business-information technology alignment by offering which e-payment systems best match its customers’ usage and preference and increase business process efficiency and revenue. Scope of the ProjectThe scope of the research study is limited to the CSUSM campus and its community members. The goal is to collect accurate and completed survey responses from 155 participants that will give essential data relating to E-payments usage on the CSUSM campus.Project Team: There are five researchers involved in this study, and each individual has different responsibilities that align with the individual’s strengths and interests. Project deliverables and requirements must be turned in on time per Dr. Kumar’s assigned due dates.

Project Deliverables: Primary Data Plan Outline, Primary Data Results from Survey, Analyzed Primary Data, Group Research Website, Final Report, and Group Presentations.Project Timeline: Tentative Group Project Due Dates set by the project

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Hypothesis:If the CSUSM population has a large percentage that prefers to use e-payments, then CSUSM campus business owners should adopt e-payment systems. Sub-hypotheses that assist in research:Age:H0: Age is not directly correlated to the use of e-payments in the CSUSM community.

H1: Age is directly correlated to the use of e-payments in the CSUSM community.Gender:H0: Gender is not directly correlated to the use of e-payments in the CSUSM community.H1: Gender is directly correlated to the use of e-payments in the CSUSM communityMarital Status:H0: Marital status is not directly correlated to the use of e-payments in the CSUSM community.H1: Marital status is directly correlated to the use of e-payments in the CSUSM community.Employment:H0: Employment is not directly correlated to the use of e-payments in the CSUSM community.H1: Employment is directly correlated to the use of e-payments in the CSUSM community.Income:H0: Income earned is not directly correlated to the use of e-payments in the CSUSM community.H1: Income earned is directly correlated to the use of e-payments in the CSUSM community.

Research MethodologyParticipants: The target sample population chosen for the research study are CSUSM community members; the majority are college students. The convenience sampling method is used to recruit and select survey participants.

Materials: Computers, paper, pen/pencils, and software programs such as Excel, Google Forms, and Google Sheets were used to analyze quantitative data from the survey responses.Procedure: E-payments survey containing ten instructions and questions relating to the frequency of usage and preference were given to 155 CSUSM community members in-person and online. Industry expert interviews were conducted to provide additional information from a business perspective. The data were sorted, organized, and analyzed using software programs listed above. The responses were coded to give numerical value so that results could be measured. Descriptive statistics such as bar graphs, pie charts, and the calculation of mean, median, and range were used to determine any correlation between variables. The results from the survey and secondary sources were used to propose recommendations to improve business-information technology alignment for CSUSM businesses by offering e-payment method systems that match customers' usage and preference.

Literature Review (Secondary Source)In the scholarly article titled, “The moderating role of income on consumers' preferences and usage for online and offline payment methods," it examined the reasons affecting e-payments preference and usage. The article mentioned how demographic factors play an essential role in choosing what type of payment methods are used by the participants. According to the report, "the higher a person's income and educational level, the more "modern" their payment behavior," and their research analysis results showed that income and education were related to consumers’ frequency of usage. (See-To et al. 192-194) Another source of information used for this project is the Management Information Systems textbook assigned in-class to help guide our research on what kind of information to obtain and which strategy to use to improve our research. Also, results from online searches led to the discovery of the latest e-payment method offered online through the CSUSM University Bookstore. This piece of information reflects the findings in the survey results.

Survey Questions (Primary Source)Nicole created the survey questions that capture data needed for the e-payment research. She encountered difficulties asking male respondents to participate in the survey. Still, with her persistence, Nicole was able to obtain the desired number of male respondents to even out the gender ratio as close as possible. As a result, Nicole reached the target number of sample populations with five extra respondents than our group had initially planned; this is why our sample population increased to 155 participants.

In-person surveys were given in-class and on the CSUSM campus to 85 CSUSM students.

70 online surveys were sent via Google Forms.

Software used for Data Analysis: MS Excel

Descriptive Statistics: Graphs, charts and correlation analysis

Demographics: Analysis/ResultsAge and E-Payments Preference

Conclusion

The graph shows that people ages 25-34 use more cash payments than ages 18-24. Both age groups use more e-payments than cash payments.

The relationship between age and e-payments usage showed that the highest percentage of respondents prefer to use both cash payments and e-payments. Participants ages 25-34, had a higher rate of preferring cash payments over e-payments than those in a younger age bracket 18-24. Not enough data prevented the group from analyzing e-payment usage within 30 days; however, based on the results, ages 25-34 used e-payments more frequently than 18-24-year-old.

Demographics: Analysis/Results Age and E-Payments AwarenessMales have heard of more e-payments than females.

Females have used more e-payments in-store.

Males reported using more e-payments online.

ConclusionThe demographics results show that the majority of the population has heard the following e-payment methods: Debit/Credit Card, Apple Pay, Google Pay, Android Pay, PayPal, and other e-payment systems not included in the survey such as Venmo, Cash App, Amazon Pay, and Vimeo. Although the respondents have heard of the e-payment methods mentioned above, it does not mean they use it. 

Demographics: Analysis/Results E-Payments Used In-Store

The graph illustrates the e-payment types used in-store by 155 CSUSM community membersAll participants have used debit/credit card in-store, followed by Apple Pay and PayPal

ConclusionNot surprisingly, the most commonly used form of e-payment method used in-store is debit/credit cards, followed by Apple Pay and then PayPal. The reason could be due to Apple Pay’s mobile payment method that allows users to store credit cards and debit cards in the app to be used for in-store payments, which makes it convenient and efficient.

Demographics: Analysis/ResultsIncome and E-Payments Preference

The graph illustrates the e-payment types used in-store by 155 CSUSM community membersAll participants have used debit/credit card in-store, followed by Apple Pay and PayPal

ConclusionParticipants who fall under a higher income bracket, prefer using e-payments over cash payments, in comparison to lower-income participants who prefer the option to both types of payment methods—cash and e-payments.

Demographics: Analysis/ResultsE-Payments Used Online

This graph shows the type of e-payments method used for online purchases by 155 CSUSM community members

ConclusionThe survey results show that all participants have used credit/debit cards for online transactions, followed by PayPal and Apple Pay. PayPal The data analysis results for in-store payments showed that 100% of the responses use Debit/Credit card as their primary method of payments, followed by Apple Pay at 34% and PayPal at 8%. Online payment usage remains the same for debit/credit card users at 100%, but PayPal's usage increased to 35%, followed by Apple Pay online payment decreased to 23%.Survey Response Correlation Analysis Correlation doesn’t mean causation, and each relationship shown in the correlation tables state whether there is a positive (strong) relationship or negative (weak) relationship between variables. Gender and E-Payments Usage

Gender E-payment In Store - SUM E-payment Online - SUM PreferenceGender 1E-payment In Store - SUM -0.10002032 1E-payment Online - SUM 0.0559935 0.479566219 1Preference -0.05306212 -0.017494841 0.034803853 1

ConclusionThis table shows the correlations between Gender and E-Payments Usage In-Store and Online

Gender (E-Payments In-Store): As gender increases from 0 to 1 (0 being female,1 being male), there is a small negative correlation within the usage of e-payments in store. Meaning women use more e-payments in store.Gender (E-Payments Online): As gender increases from 0 to 1, there is a small positive correlation with the usage of e-payments online. Meaning men use more e-payments online. Gender (Preference): There is a negative correlation between gender and preference. It means that women prefer to use e-payments slightly more than men.Survey Response Correlation Analysis Marital Status and E-Payments Usage

Marital Status E-payment In Store - SUM E-payment Online - SUM PreferenceMarital Status 1E-payment In Store - SUM -0.079104035 1E-payment Online - SUM -0.00585769 0.479566219 1Preference -0.031998809 -0.017494841 0.034803853 1

This table shows the correlations between Marital Status and E-Payment Usage

ConclusionMarital Status: The data shows that there is a negative correlation in both online and in-store payment usage as marital status increases, meaning getting married or being in a domestic partnership. Marital Status (E-Payments In-Store)- There is a slight correlation between marital status and e-payment usage in-store.Marital Status (E-Payments Online)- There is no correlation between marital status and e-payment usage online.

Survey Response Correlation Analysis Employment E-payment In Store - SUM E-payment Online - SUM Preference

Employment 1E-payment In Store - SUM 0.000268861 1E-payment Online - SUM -0.023777055 0.479566219 1Preference 0.115830112 -0.017494841 0.034803853 1Conclusion

Employment (E-Payment in Store): There is a positive correlation between employment and using e-payments in store. It means as people become employed, they use e-payments more in store.Employment (E-Payment Online): There is a negative correlation between employment and e-payments online. It means that as employment increases, people are using fewer e-payments online. Employment (Preference): There is a positive correlation between employment status and preference. It means that as people become employed, they prefer e-payments or both cash and e-payments as opposed to just cash.

Survey Response Correlation Analysis Income and E-Payment Usage

Income E-payment In Store - SUM E-payment Online - SUM PreferenceIncome 1E-payment In Store - SUM -0.001390688 1E-payment Online - SUM 0.17296056 0.479566219 1Preference 0.130842881 -0.017494841 0.034803853 1

ConclusionIncome (E-payment in-store): There is a very slight negative correlation between income and e-payments in store. It means that income has a minimal effect on e-payments in-store to the fact that there is almost no correlation.Income (E-Payments Online): There is a positive correlation between income and e-payments online. It means that as income increases, the use of e-payments online increases.Income (Preference): There is a strong positive correlation between income and preference. It means that as a population's income rises, there is more of a preferential usage on e-payments or both cash and e-payments as opposed to just cash.

 

Industry Expert Questions/ Responses

Based on the interview responses, industry experts are in favor of e-payment methods because of the following advantages: efficiency, ease of use, convenience, tracking, and record-keeping. However, merchant fees cost business operating expenses.

RecommendationsBased on the results, Apple Pay and PayPal are the most commonly used e-payments among the CSUSM community. With this knowledge, we think it would be beneficial for CSUSM businesses to offer Apple Pay and PayPal to align their e-payment systems with customers' usage and maximize their business efficiency. Upon further research, the CSUSM University Store recently started accepting PayPal payments online, which reflects the outcome of our study.

CSUSM University Store Webpagehttps://www.bkstr.com/csusanmarcosstore/home

Now Accepts PayPal Credit

Further Scope of Work For future study relating to e-payments, a larger sample population would yield more accurate statistical results, lower margin of error, and an in-depth study of the correlation between demographics and frequency of e-payments usage preferences. Also, further detailed research on how e-payments via mobile relates to demographics and the future of e-payments. Other possible topics that relate to this research can expand to mobile app payments, mobile app ordering systems, business-IT alignment for small businesses, and emerging new technology in payment systems. The study should include the advantages and disadvantages of adopting new payment systems. Interviewing more business owners will also give insight into the barriers to adopting and offering different e-payment methods. Some of the shortcomings in our research study are as follows: Interviewing CSUSM community members whether they prefer using mobile e-payments and which specific e-payment methods should CSUSM

offer on campus. Our survey questions could have been more specific with the questions asked to provide more precise qualitative results.

BibliographyEfollett, https://www.bkstr.com/csusanmarcosstore/home.Jennifer Hord "How Electronic Payment Works," 19 October 2005.HowStuffWorks.com. <https://money.howstuffworks.com/personal-finance/online-banking/electronic-payment.htm> 10 November 2019See-To, Eric, W. Papagiannidis, and K. Westland. "The Moderating Role of Income on Consumers’ Preferences and Usage for Online and Offline Payment Methods." Electronic Commerce Research 14.2 (2014): 189-213. Web.Rainer, Rex Kelly., and Brad Prince. Introduction to Information Systems: Supporting and Transforming Business. John Wiley & Sons, 2016.

AppendicesDemographics: Analysis/Results

Male survey participants made up 57.4 % of the sample population which outnumbered 42.6% female participants

The graph shows that the majority of the participants are between 18-24 years old

AppendicesDemographics: Analysis/Results

62.3% of the survey participants are CSUSM students who are employed part-time