Online Shopping in Oman: Obstacles and Challenges

8/11/2019 Online Shopping in Oman: Obstacles and Challenges

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Online Shopping in Oman: Obstacles and Challenges

How can online shopping compete with in-store shopping in Oman and how can e-retailersconvince customers to shop online?

Master of Business Administration Thesis

By

Lina Abou Chahla

A thesis submitted in partial fulfillment of the requirements for the degree of Master of

Business Administration (MBA) of the Robert Kennedy College/University of Wales

(October 23, 2013)


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Online Shopping in Oman: Obstacles and Challenges Page 1

Abstract

Online shopping has flourished in the developed world and revolutionized the way people

shop. The developing nations lag far behind in this regard, although their governments have

taken several initiatives to encourage e-commerce. Oman is one of the countries that have an

advanced technological infrastructure and an active Internet user base. The internet usage

penetration in relation to population has increased dramatically in the past few years. However,

online shopping is yet to rise significantly considering the fact that people are reluctant to

purchase through internet.Nonetheless, not much research material is available in this regard

towards the factors that hamper online shopping in Oman. Thus, the thesis aims to study the

factors that act as barriers to the development of online shopping in Oman. It also attempts to

study consumers perceptions and attitudes towards online shopping through a combination of

quantitative and qualitative techniques. While the former was conducted using questionnaire

distributed via email and in person, the latter was collected through interviews, targeting internet

users. An exploration of the current status of online shopping in Oman was also a prominent pat

of this research which threw up potential insights on overcoming the obstacles and challenges

that are hindering its growth.

Keywords: Online Shopping, Risk Perception, Online Shopping Experience, Consumer

Confidence, e-retailers.


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Table of Contents

List of Abbreviations 6

Statement of originality 7Acknowledgement 7

Chapter 1 Introduction

1.1Introduction 8

1.2Background 8

1.3Problem Definition 10

1.4Motivations for Research 10

1.5Scope of Study 11

1.6Research Questions 12

1.7Research Objectives 12

1.8Method Outline 13

1.9Thesis Overview 14

Chapter 2 Literature Review

2.1Introduction 16

2.2The state of E-commerce: Online shopping trends 17

2.2.1 Internet Usage and Growth in the World 17

2.2.2 Internet Usage and Growth in Oman 18

2.2.3 Online Shopping Growth 20

2.2.4 Online Shopping Trends in Oman 21

2.3Factors Hindering Online Shopping Growth 23

2.3.1 Privacy and Security Concerns 23

2.3.2 Dominate Cash Culture 24

2.3.3 Unreliable Delivery 25

2.3.4 Lack of Individual Home Address 26

2.3.5 Consumer Cognition 26

2.4Consumer Behavior in Mall Environment 28


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2.5Lack of Local Shopping Portals 29

2.6Absence of Multichannel Retailing 30

2.7Conclusion 31

Chapter 3 Methodology

3.1Introduction 32

3.2 Problem Statement 32

3.3Research Objective 33

3.4Research Questions 33

3.5Research Approach 34

3.6Research Design 35

3.7Data Sampling 373.7.1 Research Population 37

3.7.2 Sampling Techniques 37

3.7.3 Sample Size 38

3.8 Data Collection 38

3.8.1 Methods of Data collection 38

3.8.2 Data Collection Instruments 39

3.8.3 Limitation 40

3.8.4 Questionnaire 41

3.8.4.1Questionnaire Testing 41

3.8.4.2Questionnaire Administration 41

3.8.4.3Questionnaire Design 42

3.8.4.3.1 Questionnaire Sections 43

3.8.5 Interviews 44

3.8.5.1Interview Sections 44

3.8.6 Ethical Consideration 45

3.9 Data Analysis Method 46

3.9.1 Quantitative Data Analysis 46

3.9.1.1Types of Data 46

3.9.2 Qualitative Data Analysis 47


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3.10 Conclusion 48

Chapter 4 Analysis and Findings

4.1Introduction 49

4.2Quantitative Data Analysis 49

4.2.1 Data Tabulation 49

4.2.2 Questionnaire Responses 50

4.2.3 Detailed Analysis of Questionnaire Results 51

4.3Qualitative Data Analysis 62

4.3.1 Detailed Analysis of Interview Results 62

4.4Conclusion 66

Chapter 5 Conclusion, Limitations and Recommendations

5.1Introduction 67

5.2Conclusion 67

5.3 Limitations of the Study 71

5.4 Recommendations 72

5.5Personal Thoughts 72

5.6 Further Researches 74

Appendix A 75

Appendix B 79

References 80

List of Tables

Table 1 Internet Usage and Growth in the World 18

Table 2 Middle East Internet Users and Population Statistics 19

Table 3 Oman Internet Usage Growth and Population Statistics 20

Table 4 Demographics scale 50


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List of Figures

Figure 1 Percentages of People Who Have Shopped Online by Area 20

Figure 2 Usability of Internet 51

Figure 3 Internet Usage on a Daily Basis 52

Figure 4 Purpose for Using the Internet 52

Figure 5 Factors hindering Online Shopping Growth 54

Figure 6 Convenience and Risk Perception 55

Figure 7 Spending Intentions - Single Purchase 56

Figure 8 Spending Intentions per Year 56

Figure 9 Payment Methods Preferred 57Figure 10 Respondents Gender 58

Figure 11 Male Buyers VS. Non-Buyers 59

Figure 12 Female Buyers VS. Non-Buyers 59

Figure 13 Respondents Age Groups 59

Figure 14 Online Buyers VS. Non-Buyers/Age Wise 59

Figure 15 Participants Educational Level 60

Figure 16 Online Buyers vs. Non-Buyers /Educational Level wise 60

Figure 17 Participants Employment Status 61

Figure 18 Online Buyers vs. Non-Buyers / Employment Status Wise 61

Figure 19 Respondents Income 61

Figure 20 Online Buyers vs. Non-Buyers /Income Wise 61


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List of Abbreviations

ATM: Automated Teller Machine

B2C: Business to Consumer

COD: Cash on Delivery

CBO: Central Bank of Oman

E-business: Electronic Business

E-Commerce: Electronic Commerce

E-Retailer: Electronic Retailer

E-Service: Electronic Service

MENA: Middle East and North Africa


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Statement of originality

This research is the final dissertation for Master of Business Administration (MBA) at Robert

Kennedy College/University of Wales. This is to certify that the content of this thesis is my own

work and that all the assistance received in preparing this thesis and sources have been

acknowledged.

Lina Abou Chahla

Muscat - Oman

October, 2013

Acknowledgement

Foremost, I would like to express my sincere gratitude to my thesis advisor Dr. M.S.Chagla for

hisinvaluable support, guidance and patience. His insightful comments helped me in all the time

of research and writing of this thesis.

In addition, I would like to thank all the participants for sparing the time to partake in the

questionnaire and the interview.

Finally, I would like to express my love and appreciation to Lama Al Chamaa for her support

and encouragement during this long journey. Also I thank my family and friends for their help in

distributing the questionnaire and for their encouragement throughout the course of this thesis.


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Chapter One

Introduction

1.1

Introduction

This chapter starts with a background on online shopping followed by the definition of problem.

It discusses the motivation for research and the scope of study besides the research questions and

research objectives. Moreover, it looks at the method outline and finally presents the thesis

overview.

1.2

Background

Online shopping is becoming increasingly popular, where more and more consumers around the

world are getting connected and comfortable with the online shopping experience. An increasing

number of retailers are now seeking growth through e-commerce. Businessmen are no longer

confined to their city or region.E-commerce has established itself in the developed countries;

however it is yet to make inroads in most of the developing countries (Dholakia, 2005).

In the U.S., Forrester Research shows that $248.7 billion online sales are expected by 2014; an

annual growth of 10 % (wwwmetrics, 2009). In Western Europe sales are expected to reach 14

billion Euros ($155.7 billion), a growth of 11 % annually (ibid). Furthermore, the head of


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Alibaba Group's strategy expects that large Chinese e-commerce transactions hosted by its main

shopping websites to triple to 3 trillion Yuan (US$473 billion) over the next five to seven years,

as the country's online retail market continues to expand (Osawa, 2012).

B2C (Business to Consumer) e-commerce sales in MENA (Middle East and North Africa) region

are expected to reach an estimated $15 billion in 2015, where UAE has the highest percentage of

internet users who shop online, compared to other countries in the Middle East (Dalakian, 2012).

However, in Oman, online shopping has not progressed at a similar pace. As of 2010, B2C e-

commerce sales reached only US$ 70 million (ibid).

According to a research published last September by CBRE (CBRE, 2012), the amount of global

online shopping is set to double in two years time, and 63% of retailers will convert into fully

integrated multichannel businesses within the same period. Despite postal services and other

factors hindering the fast growth of online shopping in the Middle East, two-thirds of

international retailers see their customers making orders online and picking up the items in stores

over the next two years, where multichannel shopping will support physical shopping, not

compete with it (Middle East Oil.net, 2012).

The Government of Sultanate of Oman has taken several initiatives. It has established a reliable

IT infrastructure and has provided incentives to the IT and telecommunications companies. In

2011, it adopted an e-governance strategy. Its main mission is to facilitate and lead government

e-service implementations thereby enhancing the efficiency of public sector using modern

technology and creating a digitally-enabled society in Oman (Omanuna, 2013).


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and offering better services. However, the advantages of the phenomenon of online shopping

enjoyed by developed countries, havent yet convinced the consumers in Oman. This study is

one such attempt to identify reasons behind the slow progress of online shopping in Oman. It

analyzes the various factors that act as barriers to growth and are believed to have an impact on

B2C e-commerce adoption in Oman. This thesis provides an understanding of the current

situation of online shopping in Oman. It gives insights about what drives people to shopping

carts and what puts them off. The study hopes to guide e-retailers on how to break down the

barriers to online shopping in Oman and how to gain consumers confidence and trust. This

dissertation will assist in enhancing online shopping experience in Oman and provides valuable

information about the current status of online shopping in the Sultanate.

1.5

Scope of Study

The scope of the study is to understand consumers needs and expectations related to the online

shopping experience. It explains consumers expectations from online shopping portals and what

makes online shopping a more convenient option over in-store purchasing option. This study

intends to find out why consumers are refraining from purchasing products over the internet, and

attempts to understand their attitudes and motivations to shop online. Due to the absence of any

reliable study about online shopping in Oman, literature is sought from neighboring countries

such as UAE, as the lifestyles and cultures are similar. However, the focus of the study will be in

Oman by collecting and analyzing data from Omanis and providing recommendations for Oman

retail market.


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1.6Research Questions

a) Primary Research Question:

What are the factors that hinder the growth of online shopping in Oman?

- The questionnaire survey and interview questions contribute to answering this major

question. Nevertheless, review of the literature is critical to complement the findings

of the primary research.

b) Secondary Research Questions:

1- What are the factors that act as barriers to online shopping in Oman?

- The data collected from questionnaire survey and interview questions explores these

factors.

2- What is the impact of online payment methods on consumers buying decision?

- The questionnaire survey and interview questions seek answers to this research

question. In addition, literature review provides insights in answering this question.

3- How can local e-retailers meet customers expectations and enhance online

shopping experience in Oman?

- The interviews and the literature review contribute to answering this question.

1.7

Research Objectives

The research objectives are concerned with determining the factors that are hindering the

progress of online shopping in Oman.This study focuses on the variables that are influencing

consumers perceptions towards online shopping that are found in researches done in various


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countries. The selection of these variables further took into account the local culture and life

style in Oman that influence consumers buying decision.

In order to achieve the main objectives, this study investigates:

Factors influencing consumers decisions towards online shopping

Risk perception

Influence of online payment options

Online shopping experience

This work identifies these variables and seeks ways to rectify them. It provides recommendations

on how to improve online shopping experience in Oman based on questionnaire survey and

interview findings.

1.8

Method Outline

The dissertation research consists of primary and secondary research. Since the main objective of

this study is to determine factors that contribute to the slow growth of online shopping in Oman,

it is first necessary to study the literature to understand the current situation regarding online

shopping behavior in the Middle East and Oman in particular. The primary research approach

will be mainly of a quantitative nature. In addition, qualitative questions will be asked through

interviews in order to help in providing deeper insights while interpreting the quantitative results.

In the quantitative approach the data is collected using a standard questionnaire with close ended

questions. The questionnaires are distributed to Omanis and expatriates internet users, as


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expatriates account for 19% of the total population (index mundi, 2012). The questionnaires are

distributed to all classes of the society.

Qualitative data is collected through interviews in which respondents were asked open ended

questions. This approach helps to provide rich data that responses to close ended questions may

not be able to achieve. The secondary research is based on various resources that have addressed

online shopping such as internet sources, journals and newspapers. As there is barely any

information, reports or articles about online shopping in Oman, the secondary research is based

on resources from the Middle East, especially neighboring countries such as UAE, which

exhibits similar culture and life style. The secondary data is helpful in designing subsequent

primary research and provides a baseline with which to compare primary data collection results.

Simple statistical analysis method is used to evaluate the data collected from primary research

using Microsoft Excel.The analysis focuses on the comparative evaluation of various factors that

influence the growth of online shopping in Oman.

1.9

Thesis Overview

This thesis consists of five chapters:

- Chapter 1

Introduction: Its purpose is to provide a general overview and structure of the thesis.

- Chapter 2

Literature Review: This chapter addresses the key issues related to online shopping in

Oman. It shows theories and recent researches related to the study. This chapter discusses


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factors hindering online growth in Oman and explains the state of e-commerce and online

shopping. Furthermore, it discusses consumer behavior in mall environment and the lack

of local shopping portals. Additionally, it describes the absence of multichannel retailing

in the Sultanate.

- Chapter 3

Methodology: This chapter dwells on the problem statement followed by research

questions. It also explains the research strategy followed by the research design. Chapter

three discusses the sampling techniques used in collecting the data.

- Chapter 4

Data Analysis and findings: In this chapter, the research data is analyzed.It discusses the

techniques used in the analysis and presents the findings that were drawn from the

analysis of the collected data. In addition, this chapter analyzes the collected data in the

context of the themes that have arisen from the literature review.

- Chapter 5

Conclusion, Limitations and Recommendations:This chapter presents the conclusions

based on the findings and assumptions discussed throughout the study. Chapter 5

attempts to answer the research questions and objectives. Moreover, it states the

limitations of the study. It provides recommendations on how to improve online shopping

experience based on questionnaire and interview findings and states the value of the

research. Finally it provides personal thoughts as the motivations for research are

personal. Nevertheless, the outcome of this research will be of great benefit to local

retailers.


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CHAPTER TWO

L I TERATURE REVIEW

2.1

Introduction

This chapter includes a review of available literature on factors that are hindering the growth of

online shopping in Oman. It focuses on consumersattitudes towards online shopping and

identifies what drives people to shopping carts and what puts them off. Absence of any reliable

study on consumers' online buying behavior and online shopping in Oman, makes this research a

more significant one. As Oman is located in the Middle East, the researcher considered

researches and reports about the MENA region (Middle East and North Africa) as reliable

sources. This literature review includes references to scholarly literature available on the barriers

as to why the Sultanate of Oman has not progressed the way it should have in terms of e-

shopping and e-commerce, and how its essentially cautious and conservative business approach

could be one of the reasons for the failure of e-commerce to gain much ground in the sultanate.

This chapter describes the state of e-commerce in Oman. It discusses the factors affecting online

shopping growth in the Sultanate. The literature review studiestheshopping behavior in mall

environment and describes the lack of local shopping portals. Then, it explains the absence of

multichannel retailing (physical store and online store) in Oman.


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Table 1: Internet Usage and Growth in the World

Source: Internet World Stats-www.internetworldstats.com/stats.htm

2.2.2 Internet Usage and Growth in Oman

The internet usage penetration in relation to population in Oman has increased dramatically in

the past decade, where it places Oman with the top five countries in the Middle East which have

the highest growth of internet usage. Oman has an advanced technological infrastructure to

support e-commerce and an active Internet user base. Many telecommunication companies are

providing a high-speed broadband Internet access to the major cities. However, the internet

service in the rural areas is still weak. The Internet World Stats as of June 2012, shows 68.8 %

of the population (about 2.1 million people) are connected to the Internet (table 2), where more

than half of Omani households own a PC. According to The World Bank (The World Bank,

2011), Oman income level is high, where its GDP is $71.78 billion and of total population 2.846

million. Omans GNI per capita as of 2010 is US$ 19,260 (ibid).


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Table 2: Middle East Internet Users and Population Statistics


The growth of internet usage in Oman has been phenomenal in the past three years. As shown in

table 3, the percentage has increased from 16.3% in 2009 to 68.8% in 2012. However, the trend

of shopping online seems to be slowly catching up in Oman. UAE has the highest percentage of

internet users who shop online, compared to other countries in the Middle East. In 2010, B2C

(Business-to-consumer) e-commercesales growth in the UAE was US $2 billion compared to

only US $70million in Oman (Dalakian, 2012).
http://www.arabianbusiness.com/online-shopping-surges-in-uae-survey-shows-387619.htmlhttp://www.arabianbusiness.com/online-shopping-surges-in-uae-survey-shows-387619.html


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Table 3: Oman Internet Usage Growth and Population Statistics


2.2.3 Online Shopping Growth

Throughout the world online buying has grown exponentially. A country's prospects for online

retail success are closely related to the number of internet users and how comfortable are they in

purchasing products online. Among internet users, the highest online shopping percentage is

found in Asia Pacific, where 87% of individuals with internet access shop online. However, in

the Middle East, only 53% make online purchases as shown in figure 1. Cultural and educational

factors could be reasons behind the slow growth of online shopping in the Middle East.

Figure 1: Percentages of People Who Have Shopped Online by Area

Source: Global Trends in Online Shopping: A Nielsen Global Report June2010

87% 85% 83% 81%

53%

Asia Pacific Europe North America South America Middle East

Percentage of People Who Have

Shopped Online by Area


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2.2.4 Online Shopping Trends in Oman

Oman's online market remains small at $111 million as of 2012 (AtKearney, 2012). Promoters of

e-commerce sites hope that the increase in internet penetration, from 16% to 68% in the last

three years is likely to further boost their businessby targeting Omans growing youth

population. The median age of Oman population is 24years, where 65.7% of Omans population

is between age 15 and 64 (index Mundi, 2012).

The trend of shopping online is slowly catching up in Oman where there are a few attempts in

adopting multichannel strategy. However, issues related to online payments and postal services

forced some retailers to change their sites from online shopping portal to that of a portal giving

information about products. For instance, in 2010, The Khimji Ramdas Group, has diversified

businesses, have changed their website www.khimjishopping.com from online shopping portal,

to that of a portal giving information about their products. Recently, few companies have

launched online shopping portals for their customers in Oman and started their business online.

Focusing mainly on youngsters in Muscat as they are the ones who are mostly online and want to

buy new products, these companies are trying to overcome the obstacles that faced Kimji

Ramdas, and are striving to succeed in their new field. Some of these portals are:

- www.alatoolmuscat.com:went live September 2012. It comes out with different deals

every day on electronic items, hotels, restaurants, spas and other services. The business

model of this site is to connect sellers and buyers and eliminate middlemen. Their

revenues mainly come in the form of commission from sellers.
http://www.alatoolmuscat.com/http://www.alatoolmuscat.com/


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- www.muscat360.com:The site went live on September 2012. This online portal sells

furniture where it connects sellers and buyers and eliminates mediators. On an average, it

gets 200 visitors a day, though only a few of them actually buy things.

- eplus.panasonic.om: On December 2012 Panasonic launched an online shopping portal

for its customers in Oman, a first-of-its-kind initiative by an electronics company in the

country. Purchased products would be delivered within 72 hours of ordering and carry a

one year warranty.

- www.Pizzahut.om:Pizza Hut launched its online service on December 2012. It offers

customers who buy online 15% off. It also offers cash on delivery where payment is

made at the time of delivery.

These sites are still not known widely in Oman and most of them have limited products.

Furthermore, only few of the customers who visit these sites actually buy from them. On the

contrary, Omanis have embraced the e-ticketing concept that has been offered through the

national carrier of the Sultanate of Oman, Oman Air, at a faster pace than other online products

and services.

- www.Omanair.com: It was launched in 2007 offering its frequent flyer program

Sindbad. At present, it offers online booking, frequent flyer program, holidays

packages, online check-in and special offers.
http://www.muscat360.com/http://www.pizzahut.om/http://www.pizzahut.om/http://www.muscat360.com/


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2.3Factors Hindering Online Shopping Growth

2.3.1 Privacy and Security Concerns

Consumer concerns on security and privacy issues, in the process of online transactions, are

major obstacles in the development of e-commerce.As a correct choice can only be identified in

the future, consumers are forced to deal with uncertainty, or take a risk with their choices

(Taylor, 1974). Vijayasarathy & Jones (2000) state that perceived risk influenced both attitudes

toward online shopping and intention to shop online.

Although many banks in Oman offer attractive schemes to purchase credit cards, and encourage

the use of it with less interest and more products, the majority of Omani consumers remain

reluctant to use their credit cards and give their financial details online.

According to a PaymentOnesurvey conducted by Javelin Strategy & Research released in

December 2011, the majority of active online shoppers are concerned that their credit card data

would be intercepted or that unauthorized parties would access the information saved in the

merchants database(Leggat, 2011). A study has revealed that 43% of internet users in the

Middle East have been put off buying products online because they do not trust online payment

systems (ibid). In April 2008, the Internet Crime Complaint Center reported that online payment

fraud complaints filed by consumers in 2007 reached $239 million compared to $198 million in

2006.

The CBO (Central Bank of Oman) advises citizens and residents to take the utmost caution when

carrying out electronic trading. Authorities send messages to warn and advise Omanis to take all

the preventive procedures to make sure of the identity of the seller, to deal only with the


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authorized credit card companies, and to avoid financial transactions with unauthorized websites

or individuals, as not to fall victim to scams.

According to Abramson and Hollingshead (1999), online consumers were also concerned that

online vendors may not deliver the goods ordered or that merchandise maybe inferior, incorrectly

selected, or may never arrive.

2.3.2 Dominate Cash Culture

A cash culture is still prevalent in the region with consumers still favoring traditional payment

methods, through concerns over the security of card payments. Although people are aware of

transaction facilities offered by available credit cards, they nevertheless remain dubious with

using credit cards comfortably for online and offline payments.

Cash is widely used in Oman; most Omanis pay for their daily needs in cash.Doctors and

hospitals often expect cash payment for health services. Many companies pay salaries in cash.

Small restaurants and coffee shops accept cash only.The majority in Oman prefer to get cash at

an ATM to pay for their needs rather than using a credit card.

A deep rooted cash culture is still highly influencing consumers buying behavior. A research

conducted by Ernst & Young (2012) in the MENA found that 60 % opt for cash when they asked

how would they like to pay when they shop online. However, only 19 % like to pay by credit

card and 18 % prefer to use debit cards for online purchases.


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People remain reluctant to buy online due to the lack of innovative payment options. In their

report, McAfees Dos and Donts of Online Shopping, McAfee (2008) consider that consumers

are rightfully concerned about providing their financial information online.

2.3.3 Unreliable Delivery

Delivery is the most integral part of the whole online shopping process. A business on the

internet is incomplete if the purchaser of that product or service does not receive it. Most online

shoppers in Oman face delay in receiving their products and some do not receive anything at all.

Dennis et al. (2002), explain that customers are put off online shopping by delivery procedures.

Customers also get frustrated by unsuitable times of delivery and unreliable delivery services.

Waiting days or weeks for goods would lead to abandon online shopping. Customers expect their

orders to be home on time and without failed risks, otherwise they will not buy again. A research

published by The Independenton January 2013 found that 60% of people shopping online last

year had problems with delivery of their items (Charlton, 2013).

Some of global online e-retailers do not offer shipping to certain countries, for instance, e-Bay

and Tesco do not ship to Oman. Besides, many online portals charge high shipping costs to

Oman which increases the total cost of the product.


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2.3.4 Lack of Individual Home Address

A survey conducted by Al-Solbi and Mayhew (2005)in Saudi Arabia considered the lack of

individual home addresses is another significant obstacle to online shopping growth. In Oman,

individuals have no uniquely identified addresses or mailboxes, and mail cannot be delivered to

homes or offices. Lack of a door-to-door postal service has a negative impact on online shopping

growth. Oman does not use a postal system that delivers to home addresses. If you need to

receive mail or packages in Oman you have to pay extra charges for alternate services which

provide mail tracking and more expedient service, such as Aramex and DHL (Oman Coast,

2012). Businesses in Oman use international shipping companies services like Aramex to

deliver safely on their contracts. Individuals use their work addresses, i.e. the address of the

company they work for, if they have to receive parcels from abroad. The location of a company

is easier to be identified by couriers than a home address.

2.3.5

Consumer Cognition

Consumer cognition is another important factor impact consumers buying decision. Online

transactions must be conducted through computer networks. Therefore, an online buyer must be

in the first place willing and capable to operate a computer. Beside the basic knowledge of

computer use, consumers also have to learn the skills needed to obtain the desired information on

the internet. Since learning-by-doing is an important to acquiring such skills, those who have the

most experience at shopping on the internet are likely to be the most skilled (Ratchford et al.,

2001). In 2011, the Sultanate of Oman has introduced Information Technology studies to

students in the early stages of education. It aims to develop education and raise its efficiency in


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the light of modern challenges and requirements of the future. This step helps Omanis to

improve their computer skills in the long run.

In addition to computer literacy, language is considered another barrier to online shopping.

Global portals offer content in the English language. Although English is widely spoken in the

urban areas of Oman, Arabic and Baluchi are the primary spoken languages in the rural areas.

Omans literacy rate has increased to 86.6 % as of 2008 (World Data Atlas, 2012) . Oman is

making strong efforts to teach English as the second language to the younger generation, and the

number of providers of English language training has expanded to meet the increased demand.

Another cognition factor that impacts online shopping growth is consumers previous

experience. Consumersprevious experiences with online purchases, or lack thereof, can be of

significant influence on their purchasing decisions. Negative experiences increases the level of

risk perception with online purchasing and hamper online shopping growth. Individual cognition

and consumer behavior have great impact on online shopping.

As deep-rooted traditional shopping habits prevail consumers make their purchasing decisions,

after they personally see, hear, touch, taste and try the product in question. Online shopping

could only provide visual and audio effects which influence consumer online buying decision.

Cconsumers buying behaviour and the resulting purchase decision are strongly influenced by

cultural, social, personal and psychological characteristics (Kotler et al, 2003).


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2.4 Consumer Behavior in Mall Environment

Shopping malls in Oman have become the modern day community centers, with so much to see,

try, spend, and consume all under one air conditioned roof (My Destination, 2013). Malls have

become more like full-service community centers, where mall shoppers have more than one

reason to go to malls; cinemas, restaurants, playing areas, spas, hair dressers, banks, art galleries,

education centers, and many more beside retail shops are located in a mall. Shopping malls are

viewed as a place not only for shopping but also for recreation and entertainment (Bloch et al.,

1994).

Most Omani consumers prefer to shop in malls, as they consider shopping mall is a place to meet

with friends and family and have fun. As Oman weather is hot almost throughout the year,

people do not have much outdoors options to spend time and have fun; thus, going to air-

conditioned shopping malls is the only option to spend good time and shop as well.

Velitchka and Barton (2006) find that recreational-oriented shoppers derive shopping value from

the shopping activity itself not necessarily buying a product. These shoppers love the fun and

fantasy of the shopping experience.Shoppers browse through the aisles and displays to find what

they want, sometimes finding things they were not even looking for; instant gratification is

always tempting (Paludan, 2012). Retail stores in the Middle East seem to appeal to larger

audience;they appreciate the experience of interacting with the people they meet while there.

Many young consumers, especially the students belonging to high schools, colleges and

universities, do not use credit cards as they do not have an independent income. Mostly they

depend on their families to support them during their period of study with a few exceptions like


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the ultra rich. Hence credit cards are not in their schema of things which eventually forbade them

from shopping online, so they may have no choice but to visit malls.

Being able to try, touch, and see products are some of the advantages of shopping in malls.

While shopping from physical stores,returning or changing purchases is an easy task. In

addition, consumers could have better bargain while buying from shopping malls. Nevertheless,

online shopping is fundamentally different from traditional shopping. While shopping online,

people miss the social dimension (Condon, 2012).

2.5

Lack of Local Shopping Portals

Online shoppers prefer to buy locally. According to the latest MasterCard Worldwide Survey on

Online Shopping Behavior, faster deliveries times, buying trusted and familiar brands and being

able to return goods easily, drives people to shop online from local stores (OCarroll, 2012).

Some markets have the technological infrastructure to support e-commerce, but poor in-country

dynamics such as logistics, digital laws, or cultural biases that make internet users wary of

purchasing online (Atkearney, 2012). Oman has an advanced technological infrastructure to

support e-commerce and an active Internet user base; however, managers of online shopping

sites say the growth in online shopping in Oman, although encouraging, is not as high as

expected. People still have a lot of questions and concerns about online payments. And so many

of them just prefer to get information about products on offer and actually physically visit stores

to check them out. says Shaheer Abbasan online retailer (Solomon & Joseph, 2013).

Retail stores in Muscat do not perceive online shopping as a challenge, at least for the time

being. People still like to experience the pleasure of physically visiting stores and buying stuff


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online shopping is still in its infancy and even those who shop online carry out traditional

shopping. So no, we do not perceive the growth of online shopping as a threat, says Renil

Markose, manager of a leading branded store chain (Solomon & Joseph, 2013). Very few local

retailers have launched shopping websites in Oman; however most of them do not meet

customers expectations.

2.6

Absence of Multichannel Retailing

Multichannel retailing allows the consumer to transact via a variety of connected channels such

as in-store, online over a computer, and via a mobile site or app. According to The Gulf (2012),

growth in multichannel in the Middle East is being constrained by a lack of content, with many

local retailers failing to offer online product catalogues or purchase facilities on their websites.

Other barriers include a level of mistrust of local retailers, poor customer service, and absence of

an established and trusted postal system.

The absence of multichannel retailing (physical store and online store) in Oman is impacting

online growth. Although many leading brands are available in the sultanate, however none of

them have adopted the multichannel strategy.

Multichannel shopping complements physical shopping, not compete with it.E-commerce and

multichannel integration in emerging markets offer tremendous opportunities at potentially lower

risk on investment than building bricks-and-mortar stores (Atkearney, 2012).With a dearth of

postal services hampering the growth of online shopping in many parts of the Middle East, and

the mall-environment set in the daily activities of the Middle East residents, two thirds of


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retailers see their customers making orders online and picking up the items in stores, over the

next two years.

According to research published on September 2012 by CBRE (CBRE, 2012), a property

consultant based in the U.S, when asked how they would do more business online, 80% of

respondents said they would offer shoppers the chance to use online kiosks in their stores. To

be successful, online retailers will have to become more creative in their offer in order to entice

shoppers away from organized formats. said Matthew Green, the head of research and

consultancy for CBRE Middle East (Waqas, 2013).

According to CBREresearch (CBRE, 2012), 63% of retailers will convert into fully integrated

multichannel businesses in the coming two years. Many multichannel shoppers like to research

online, but more still prefer to buy products at a physical store.

2.7 Conclusion

Based on the detailed review of literature on the factors hindering online shopping growth in

Oman, a research is prepared to investigate these factors and to understand the current situation

of online shopping in the Sultanate. The following chapter discusses the instruments used for the

purposes of this research.


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3.3Research Objective

The purpose of research is very important in deciding research approach, strategy, data collection

method and analysis of data. According to Sunders, Lewis and Thornhill (2003),a research can

be categorized as Basic research and Applied research depending on purpose and context.

- Basic researchis generally conducted by academic organizations or individuals with self

defined objectives in a flexible time scale with the purpose of expanding knowledge of

business and management processes which has significance to society in general.

-

Applied researchis conducted by people from different sections of the society in

consideration with different interest groups, with a limited time scale. Its purpose is to

improve understanding of a particular business or a management problem, acquiring new

knowledge that leads to solutions for the interest groups.

As the purpose of this study is to acquire new knowledge and gain better understanding of online

shopping experience in Oman, this research is categorized as Applied Research.

3.4

Research Questions

a) Primary research question:

- What are the factors that hinder the growth of online shopping in Oman?

As online shopping is booming around the world whilst growing slowly in Oman, it was

critical to find out the factors hindering fast growth, and to identify why consumers remain

somewhat reluctant to use online channels for shopping.


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b) Secondary questions:

1- What are the factors that act as barriers to online shopping in Oman??

2- What is the impact of online payment methods on consumers buying decision?

3- How can local e-retailers meet customers expectations and enhance online shopping

experience in Oman?

Finding answers to these questions through this study will lead to answer the major question on

what are the factors that affecting the growth of online shopping in Oman and how to enhance

online shopping experience in the Sultanate.

3.5

Research Approach

As any other research, this study requires an adequate approach to fulfill all the requirements of

the research based on the study nature. According to Saunders et al. (2003), there are two

approaches that must be considered to select either one or both of them in a desired study, which

are Quantitative Approach and Qualitative Approach.

- Quantitative Approachinvolves the use of structured questions where the response

options have been predetermined and a large number of respondents are involved.

Measurement must be objective, quantitative and statistically valid (Saunders et al.,

2003).Quantitative data refers to number organized data and can be expressed

numerically giving the framework with numerical value (Lancaster, 2005).

- Qualitative Approachis based on collecting, analyzing, and interpreting data by

observing what people do and say. Qualitative Approach is much more subjectivethan

Quantitative Approach. Ituses different methods of collecting information, mainly


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individual, in-depth interviews and focus groups (Saunders et al., 2003). Therefore, those

data has usage and utilization in investigation about people's opinion, attitude, fears and

hopes which cannot be numerically analyzed.

Theresearch approach is of quantitative and qualitative analysis. The quantitative approach is

based on a questionnaire survey targeting locals and expatriates internet users. The respondents

were expected to respond to certain questions in a given scale. In order to help interpret

quantitative results in a deeper insight and strengthen the research responses, a qualitative data

was gathered as well; respondents were asked open ended questions and were free to give their

own opinions.

3.6Research Design

The research design is used to address the research questions which were taken into

consideration in this study. According to Sunders et al. (2003), the research design is a general

plan, of how the main objectives being examined in the thesis, were determined. This requires to

clearly stating the objective of research questions, source from which data is to be collected and

the constraints in relation to time, access and ethical issues. There is several research designs

used in different scenarios; however,the purpose of the study enables the choice of a strategy,

which sometimes could be more than one design as well. In the view of Saunders et al. (2003),

there are three various types of research design followed as: Exploratory, Descriptive and

Explanatory.

- Exploratory: Exploratory research is constructed to find out what is happening, to seek

new insights, to ask questions and to assess new phenomena (Saunders et al., 2003). The


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usage of this approach is essentially useful for understanding the problem expressing. It is

the most suitable research design for new studies. The main steps to conduct an

exploratory research: searching and studying the literature, talking to experts in the

subject and conducting focus group interviews (ibid). This concept is characterized as

flexible and adaptable to daily changes as a result of new information upcoming or new

hypothesis appearing.

- Descriptive:Descriptive concept tends to answer on questions such as "who", "where",

"how many" and "how much". According toSaunders et al. (2003), theconcept of

descriptive research implies design addressed to reveal validate profile of persons, events

or situations. It is useful and crucial when the researcher achievement focuses on details

and description of phenomena or when it should show prediction about specific findings.

In addition, such approach tries to describe present conditions, events or systems based

on the impressions or reactions of the respondents of the research (Creswell, 1994).

-

Explanatory: Explanatory research is conducted for answering the "how" and "why"

questions. It focuses on finding casual relationships between variables. The concept of

this approach use qualitative way of research such as case studies, histories and

experiments. It aims to describe relationships expressing the cause and effect of a

particular incident (Saunders et al., 2003).

The descriptive research design was chosen for this study because it aims to present facts which

focus on the nature and status of a situation as it exists at the time of the study (Creswell, 1994).

Therefore, this research is of a descriptive nature as it was developed in order to gain a deeper

understanding of factors influencing online shopping growth in Oman.In addition, such


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approach is useful in this study because it enables the researcher to focus on the current

perception of the respondents towards online shopping in the Sultanate.

3.7

Data Sampling

3.7.1 Research Population

The survey was conducted to different age groups of internet users in Muscat, the capital of

Sultanate of Oman, and its surroundings. Omanis and expatriates partook in the questionnaire,

who might or might not been online consumers. Interviews were conducted to internet users who

have online shopping experience and to those who are reluctant to purchase online, including

Omanis and expatriates. Interviews were scheduled to cover the information that is important to

this study. Valid data came from accomplished questionnaires and interviews.

3.7.2 Sampling Techniques

According to Saunders et al. (2003), it is impossible for a researcher to collect and analyze all the

data available due to restrictions in time, money and often access. However, sampling techniques

provide various methods that enable the researcher to reduce the amount of data to be gathered

by considering only data from a part of population yet, still get the appropriate results to

generalize the findings.

Data for this study was collected randomly from internet users. Initially the participants were

asked if they were internet users, only then the questionnaires were distributed and interviews

were conducted.


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3.7.3 Sample Size

When conducting a survey, the sample chosen should represent the rest of population; therefore,

for this study purpose, 150 questionnaires were distributed to different sections of society at

different locations such as social gatherings, malls, companies, clinics and universities.

Questionnaires were distributed in person, and via online survey using email invitations.

Interviews were conducted by random selection of online and non online shoppers.

3.8

Data Collection

3.8.1 Methods of Data Collection

Data collection method is one of the most important elements in research project. According to

Saunders et al. (2003), there are various forms of information which can be distinguished in two

main groups as primary data and secondary data.

- Primary Data:Primary data refers to collection of data by researchers in order to gather

valuable data necessary for researchers' projects. The data under this category can be

collected using the various methods and techniques such as interviews, questionnaires,

case studies, observations, experiments or any other method appropriate to the

researchers subject matter.

- Secondary data: Lancaster (2005) stated that the secondary data are "second hand" data

which already are collected and used by other researchers for the purpose of previous

researches and giving hypothesis on other issues. Therefore, secondary data can be


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collected from previous studies, surveys or literature. It has qualitative and quantitative

nature and it is useful in both descriptive and explanatory research.

This study is based on primary data collection as its main purpose is to study the current status of

online shopping market in Oman. Moreover, secondary data has been used to present the

theoretical and conceptual part of the study and designing the questionnaire. It was also useful in

providing relevant and recent statistics and facts about online shopping.

3.8.2 Data Collection Instruments

There are various data collection instruments that are used depending upon the type of research

proposal. The researcher may use one or more of the instruments in combination for the purpose.

Such tools or instruments of data collection include interviews, questionnaire, and observation.

Therefore, data can be collected using:

-

Interviews: An interview is a direct face-to-face attempt to obtain reliable and valid

information verbally from one or more respondents. Interview can be done in person or

over the telephone.

- Questionnaire:A questionnaire is a preplanned set of questions designed to yield specific

information such as thoughts, feelings, attitudes, perceptions, and behavioral intentions of

research participants, to meet a particular need for research information about a pertinent

topic.

- Observation:observation is the watching of peoples behavior in certain situations to

obtain specific information about the phenomenon of interest.


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In order to meet the objectives of this study, two instruments were used; a questionnaire and

interviews. Closed forum questionnaire was distributed consisting of a series of questions for the

purpose of gathering information from respondents. Furthermore, structured interviews were

conducted in orderto strengthen the validity and reliability of the findings and to find out

answers to some of the research questions.

3.8.3 Limitation

Since the target population is not much aware of the value of such researches they generally don't

show much interest in participating in the process. To convince them to partake in the

questionnaire was not any easy task. Moreover, many people are not interested in disclosing or

sharing their personal information, therefore, the personal information questions were asked

towards the end of the questionnaire, where respondents would have developed an interest in the

subject by this stage, and complete the questionnaire. In addition, the time available to distribute

the questionnaire, conduct the interviews, and complete the data collection and entry was quite

limited.


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3.8.4 Questionnaire

3.8.4.1 Questionnaire Testing

Prior distributing the questionnaire, it was tested to ensure the validity and reliability of the

instruments used, and necessary adjustment has been made to it. The questionnaire has been

piloted to determine how realistic the questions were to the ability of the participants. Seven

internet users completed it, then based on their feedback on what was clear and what was not,

further amendments has been made. In order to keep the questions clear and relevant to

participants of various educational levels, few questions were simplified and simpler English

words were used. The design of one of the likert scale question has been adjusted in order to

keep the question clear and unambiguous. Furthermore, leading questions was altered in order to

limit the bias of the results. The purpose of the questions was to drive generalized results in order

to ensure the validity and reliability of the study results.

3.8.4.2 Questionnaire Administration

A questionnaire is a series of written questions in which participants respond to the same set of

questions in predetermined order. Questionnaires are the most widely used techniques in the

social sciences to collect data,where it can be sent to a large number of people and saves the

researcher time and money. People are more truthful while responding to the questionnaires

regarding controversial issues in particular due to the fact that their responses are anonymous

(Leedy & Ormord, 2001).


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Ways of administering questionnaires:

- Self-Administering Questionnaire: The self-administered questionnaire is a questionnaire

that a respondent completes on his/her own, either on paper or via computer.It can be

conducted in a number of waysincluding individually, by mail and online.

- Interviewer Administered Questionnaire:The interviewer administrated questionnaire is

a questionnaire that a respondent completes in the presence of the interviewer.It can be

conducted via the telephone or face to face.

For the purpose of this study, Self-Administering questionnaire was used, where the

questionnaire was distributed in-person and online, and were collected in the same manner.

3.8.4.3 Questionnaire Design

The questionnaire was designed to fulfill the objectives of the study. It intends to collect required

data with a minimum number of questions. It consists of five sections: Internet Usage,

Convenience and Risk Perception, Spending Intentions, Payment Methods Preferred and

Personal Information. The questionnaire consists of various types of closed ended questions; this

includes cumulative scale questions, ordinal and dichotomous. In addition two questions were

formulated with five-point Likert scaling (Strongly Disagree = 1; Disagree = 2; Dont Know = 3;

Agree = 4; Strongly Agree = 5).


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3.8.4.3.1 Questionnaire Sections

- Section A: Internet Usage

This section focused on measuring how many internet users shop online. It intends to

give an idea about the online shopping market in Oman. It also aims to discover the

respondents availability and accessibility to Internet.

- Section B: Convenience and Risk Perception

This section dealt with the factors hindering consumers from buying online. It seeks the

influence of perceived risk, convenience, cost and enjoyment on online consumers

buying decisions.

- Section C: Spending Intentions

This section sought the spending intentions of online consumers. It intends to identify the

online purchasing power of online consumers in Oman, and its influence on the growth of

online shopping.

- Section D: Payment Methods Preferred

The question under this section focused on payment methods preferred by online users. It

intends to show which of the payment methods increases customers confidence online

and drives them to purchase over the internet.

- Section E: Personal Information

This section sought personal information i.e. gender, age, income, educational level,

employment status, and monthly income. This information helps the researcher to find

out the relationship between the demographic information and other variables impacting

online shopping growth.


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3.8.5 Interviews

Saunders et al. (1997) describe an interview as a purposeful discussion between two or more

people. Interviews are meant to elicit primary data responses through direct questioning.

Interviews can be conducted in different ways such as structured, semi- structured and un-

structured interview. Through conducting interviews the researcher gets new information or

knowledge which results in identification of several factors influencing the problem under study.

As this research is of a descriptive nature, structured interviews were conducted, where same

questions were asked to all respondents. According to David and Sutton (2004), the strength of

structured interviews is that prompting can be included with the questions, where the interviewer

can ask the interviewee to explain the answers, if found vague.

Interviews for the purpose of this study were conducted in person and over the telephone. Data

collected using interviews has strengthened the validity and reliability of the data collected

through the questionnaire. In addition, it gave more clarification to some of the research

questions.

3.8.5.1 Interview Sections

- Section A: This section focuses on respondents shopping experience. It aims to

investigate which shopping method they prefer and identifies factors influencing their

buying decision.

- Section B: This section investigates the interviewees risk perception. It aims to find out

the influence of the payment methods and delivery options offered by e-retailers on their

buying decision.


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- Section C: It focuses on the role of multichannel market in enhancing online shopping.

This section intends to investigate the respondentsinterest in multichannel shopping

(buy online and pick in-store).

- Section D: Questions in this section focuses on respondents online buying experience. It

intends to investigate the drawbacks they faced while shopping over the internet.

- Section E:It covered the respondents personal information. It aims to find out

relationships between demographic information and other variables impacting online

shopping growth.

3.8.6 Ethical Consideration

Apart from instrumentation and procedural concerns, collecting data from people raise ethical

concerns. These include taking care to avoid harming people, keeping participants information

confidential, and respecting them as individuals (Goddard & Melville, 2007). Any survey should

be conducted in an ethical manner. Therefore, when the questionnaire was conducted, two

important ethical issues were taken into consideration; confidentiality and informed consent. The

participants were fully informed about the aims of the questionnaire. Their permissions were

taken before distributing the questionnaire. Furthermore, all data participants provided are kept

completely confidential and used only for the purpose of this research.


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3.9Data Analysis Method

Data analysis methods help to understand facts, observe patterns, come up with explanations, and

try out hypotheses. There are various methods to analyze data, this includes charts, graphs, and

write-ups in text form. These methods are designed to interpret and refine the data, so that the

end users can obtain useful information.

3.9.1 Quantitative Data Analysis

This is the process of presenting and interpreting numerical data .This analysis could range from

simple diagrams that show frequency of occurrences, to diagrams that show relationships

between variables or more complex relationships.The outcome of quantitative data analysis

often contains descriptive statistics and inferential statistics. The data collected for the purpose of

this study were analyzed using MS Excel where logical links between the variables were created.

3.9.1.1 Types of Data

When analyzing quantitative data, the appropriate methods for summary and display depend on

the purpose of the study and the type of the research questions. Appropriate statistical test should

be employed in order to ensure the accuracy of the results. According to Saunders et al. (2003),

the quantitative data can be divided into two groups: categorical and Quantifiable.

- Categorical Data: Those values cannot be measured numerically but can be classified

into sets according to their characteristics. The variances of this type of data are:


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o Nominal: No inherent order in categories; such as eye color, ethnicity, etc.

(University of the West of England, 2007).

o Ordinal: Categories have inherent order; such as age groups (ibid).

o Binary: Two categories; such as gender (ibid).

- Quantifiable Data:Those values can be measured numerically. The variances of this type

of data are:

o Discrete: Usually whole numbers; such as number of business books: ratio

(University of the West of England, 2007).

o Continuous: Can take any value in a range, although necessarily recorded to a

predetermined degree of precision; such as temperature C/F: interval; height:

ratio (ibid).

Therefore, the data collected through the questionnaire was of quantifiabletype, where the data

was more precise and easy to analyze.

3.9.2 Qualitative Data Analysis

Qualitative data consists of words and observations rather than numbers. Analysis and

interpretation requires creativity, discipline and systematic approach in order to bring good

understanding to the end users (Taylor-Powell & Renner, 2003).In order to analyze the results of

such data it is important to categorize them in a meaningful way; this depends on the type and

nature of the questions.

For the purpose of this study structured interviews were conducted, where the data collected

through the interviews was categorized according to the requirements of the research questions.


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3.10 Conclusion

This research is categorized as applied research. Theresearch approach is of quantitative and

qualitative analysis and it is of a descriptive nature. This study is based on primary data

collection and on secondary data. Two instruments were used to collect the primary data; a

questionnaire and interviews. Data collected were analyzed and displayed using the appropriate

methods. The next chapter presents the data analysis and displays the findings of the research.


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Chapter Four

Analysis and F indings

4.1

Introduction

This Chapter presents and analyzes the data collected through the questionnaire that was

prepared and distributed for the purpose of this study. In addition, it presents and analyzes the

data gathered through the structured interviews. It explores why Omani consumers have not yet

embraced online shopping and still much rather prefer to shop in-store.

4.2

Quantitative Data Analysis

4.2.1

Data Tabulation

The data gathered were tabulated using Microsoft Office Excel 2007. Microsoft Excel features

were used to enter the available data, design the graphs and to create links between variables. As

the data was quantifiable, the demographics and personal information (i.e. age and monthly

income) scale of five were further tabulated to create a three scale measurement for interpretation

and presentation as shown below:


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Table 4: Demographics scale

For ease of interpretation the Likert Scale, data were grouped into two new categories. Ratings of

Strongly Disagreeand Disagreewere grouped together into one category called Disagree.

Ratings of Strongly Agreeand Agreewere grouped together into one category called Agree.

However, ratings of Dont Know were not counted. Links between non-online buyers and

factors keeping them from buying online was established to identify the most influential factors

that affect their buying decision. Another link between online buyers and perceptions towards

online shopping were created. Moreover, a relationship was created between demographic

factors and online shopping experience. The analysis of data gathered was done using functions,

sorting, filtering and graphical presentation.

4.2.2 Questionnaire Responses

All participants who partook in the questionnaire are internet users, have easy access to internet,

and familiar enough to use it for useful purposes. Participants do not have any language barrier,

and have good level of English language skills. There were 150 questionnaires distributed to

different sections of society, Omanis and expatriates, 135 completed questionnaires were

received. There were 10 questionnaires left out of study due to incomplete information, where it

Old Aged

Under 18 18 - 29 30 -39 40-49 over 49

Low

less 300 300 - 700 701 - 1000 1001 - 1500 More than 1500

Age Group

Young Aged Middle Aged

Moderate High

Monthly Income in O.R.


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couldntbe accounted as valid questionnaires. There were 125 questionnaires valid and ready to

be analyzed for the purpose of this study.

4.2.3 Detailed Analysis of Questionnaire Results

The quantitative data gathered through questionnaire is presented in graphical form with a brief

description for each graph in order to explain the results of each question.

Section A: Internet Usage

In this section, questions about internet usage have been covered in order to know the

respondents availability and accessibility to internet, and their purpose of using the internet.

Figure 2: Usability of Internet

83% of the participants have been using the internet for more than five years as shown in figure

2. This result shows that most participants have good experience with the internet. Internet

experience is not a barrier to online shopping in Oman.

7%

10%

83%

How many years have you been using the web?

Less than 3 years

3 - 5 years

More than 5 years


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The research revealed that only 27% of participants use the internet to shop online. The majority

of internet users use the internet for sending and receiving emails, and for searching information.

The study found that 73% access social networking sites while connected to the internet and 40%

use the internet to play games online and to access other entertainment sites. These figures reflect

that even though Omanis have internet facility, use smart phones with internet connectivity, yet

they use the internet only for viewing and downloading movies, songs, social networking sites

for connecting with new friends and communicating with them. Rarely do they use it for

shopping online.

Section B: Convenience and Risk Perception

In order to investigate consumers perception towards online shopping, this section was divided

into two main questions; one question targeted non-online buyers and the second question

targeted online buyers.

- Data collected from non-online buyers is grouped together and shown in figure 5.


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Figure 5: Factors hindering Online Shopping Growth

Amongst the top factors keeping them from buying online, respondents chose risk of credit card

fraud (82%), unavailability of COD(Cash on Delivery) payment option (74%), lack of a door-

to-door postal delivery service (71%) and risk of not receiving the products they purchased

online (70%).

68% of the participants said that they do not purchase their needs over the internet as they are not

able to touch the products. 64% of the respondents agreed that lack of trustworthiness of e-

vendors is one of the factors that keep them from buying online, and 61% prefer buying from

shopping malls to shopping over the internet. The absence of local shopping portals keeps 44%

from buying online. 40% said they had undergone a bad experience in the past. However, only

16% do not purchase online because they are not skillful with internet.

Not skillful with internet

Undergone a bad experience in the past

Absence of local shopping portals

Prefer to shop in shopping malls

Lack of trustworthiness of e-vendors

Not being able to touch the product

Risk of not receiving the product I bought online

Lack of a door to door postal delivery service

Unavailability of 'Cash on Delivery'

Risk of credit card fraud

16%

40%

44%

61%

64%

68%

70%

71%

74%

82%

% of Participants agreed

What factors refrain/keep you from buying online?


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These figures show that inconvenient payment methods, lack of a door-to-door postal service,

and unreliable delivery methods have a significant impact on consumers online buying decision.

Additionally, the habit of touch and see the product before buying it has a high impact factor on

consumers decision. Lack of trustworthiness of e-vendors and the temptations of shopping

malls are important factors hindering online shopping in Oman.

- Data collected from online buyers is grouped together and shown in figure 6.

Figure 6: Convenience and Risk Perception

More than 80% agreed on online shopping is any where any time, saves time, and gives them

access to global brands. 77% indicated that when they buy online, they have concerns about their

credit card and personal information being stolen, and 73% consider shopping online is risky.

Online shopping is 'anywhere anytime' shopping

Shopping online saves time

Shopping online is risky

I am concerned about my credit card and personal information being

stolen

Selecting, buying and paying on online stores is complicated

A long time is required for the delivery of products

I prefer to buy online from brands that have physical stores in Oman

I have access to global brands

Online Purchasing is a money saving option

8%

15%

27%

18%

79%

32%

52%

16%

32%

92%

84%

73%

77%

19%

52%

40%

82%

55%

Convenience and Risk Perception Agree Disagree


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9%

21%

33%

37%

Amount Spend on a Single Purchase

le ss than O.R. 30 O.R. 31 - 5 0 O.R. 5 1 - 1 00 O. R. 10 1 & above

9%

37%

33%

21%

Amount Spend per Year on Online purchases

L ess than O.R 100 O.R 101 - 300 O.R 301 - 700 O.R 701 & above

The research found that 55% of online shoppers consider online purchasing is a money saving

option. In addition, 52% agreed that a long time is required for the delivery of products on the

internet, and 40% prefer to buy from brands that have physical stores in Oman. 79% of online

buyers consider selecting, buying and paying on online stores an easy task.

The survey found that although they buy online, more than 70% of online buyers indicated that

they always have concerns about online fraud and consider shopping over the internet is risky.

Section C: Spending Intentions

This section focuses on online buyers spending intentions in order to evaluate online purchasing

power in Oman.

Figure 7: Spending Intentions - Single Purchase Figure 8: Spending Intentions per Year

The research found that 37% of respondents would spend more than a100 O.R on a single online

purchase and 33% would spend between maximum amounts of 51 to 100 O.R. on a single


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0%

10%

20%

30%

40%

50%

60%

Billing to

mobile

phones

Cash on

Delivery

Credit Card Wire

transfer

%o

fPartic

ipants

payment methods chosen as the most preferred option

Most preferred payment methods

purchase. Moreover, 37% would spend an approximate maximum amount of 101to 300 O.R. per

year on online purchases and 33% said they would spend up to 700 O.R. per year on online

purchases. The survey revealed that online buyers spending intentions are of moderate level.

Section D: Payment Methods Preferred

This section aims to find out the preferred payment methods for online purchases. Participants

were asked to rate the methods on a scale of 1-4, where 1 being the most preferable method. The

percentage of participants who chose each payment method as number 1 is shown in the figure

below:

Figure 9: Payment Methods Preferred

The survey explored that 56% of respondents prefer to use Cash on Delivery when they intend

to buy over the internet, however, 35% considered credit card a preferable payment option for


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46%

54%

GenderMale Female

online shopping. Only 6% indicated that wire transfer payment option is the most preferable, and

2% chose billing to mobile phones as the most convenient option. The study found that Omanis

consider COD payment method is one of the most convenient online payment options.

Section E: Personal Information

The last section covered demographics and personal questions to gather information about the

respondents which could help the researcher to find relationships between demographic factors

and other variables.

a) Respondent Gender

The respondents were a mix of online buyers and non-online buyers. Male and female

respondents partook in the questionnaire as shown in the figure below.

Figure 10: Respondents Gender

54% of respondents were females and 46% were males.


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35%

65%

Male Respondents

online Buyers Non-online Buyers

21%

79%

Female Respondents

Online Buyers Non-online Buyers

37%

35%

28%

Age Groups

18-29

30-49

over 49

0

5

10

15

20

25

30

35

40

18-29 30-49 over 49

No.

ofParticipants

Online Buyers

Non-Online Buyers

Figure 11: Male Buyers VS. Non-Buyers Figure 12: Female Buyers VS. Non-Buyers

35% of male respondents said they bought online; however only 21% of female respondents

were online shoppers. This result shows that males have the interest in online shopping more

than females.

b) Respondent Age

The respondents were of different age groups as shown in the figures below.

Figure 13: Respondents Age Groups Figure 14: Online Buyers VS. Non-BuyersAge Wise


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High School

26%

College/Dipl

oma

27%

Bachelors

25%

Masters or

higher

22%

Educational Level

0

510

15

20

25

30

35

No.

ofParticipants

Educational Level

Online Buyers

Non-Online Buyers

The survey targeted different age groups as shown in figure 13. Most of the middle and old age

respondents were employed. Many of the young participants were students and/or employed.

The survey revealed that online buyers are mostly of age 30-49 as shown in figure 14.

c) Respondent Educational level

Figure 15: Participants Educational Level Figure 16: Online Buyers vs. Non-BuyersEducational Level wise

Participants of different educational levels partook in the survey as shown in figure 15.

The research found that educational level has high impact on online shopping adoption. As

shown in figure 16, the greatest portion of online buyers in Oman has high educational level as

Bachelors or higher. This result indicates that qualification is an important element influencing

consumers buying decision.


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19%

55%

9%

17%

Employment status

Student

Employed

Retired

House wife/Husband

0

10

20

30

40

50

No.

ofParticipants

Employment Statu

Online Buyers

Non-Online Buye

23%

50%

27%

Monthly Income

less than 300 300-1000 over 1000

0

10

20

30

40

50

le ss than 30 0 3 00 -1 00 0 ove r 1 00 0

No.

ofParticipants

Monthly Income in O.R.

Monthly Income

Online Buyers

Non-Online Buyers

d) Respondent Employment Status

Figure 17: Participants Employment Status Figure 18: Online Buyers vs. Non-BuyersEmployment Status Wise

As shown in figure 17, people of various employment statuses participated in the survey. The

survey revealed that employed respondents were the most online buyers. Students, retired and

house wife/husband rarely buy online as shown in figure 18.

e) Respondent Monthly Income

The participants were of various monthly income levels as shown in the figures below:

Figure 19: Respondents Income Figure 20: Online Buyers vs. Non-BuyersIncome Wise


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Figure 19 shows that respondents were of high, moderate and low income level. The majority of

online buyers were of moderate and high income levels as shown in figure 20. The research

found that income level has impact on online shoppi

Documents

Online Shopping in Oman: Obstacles and Challenges