Determinants of online purchase intention: a PLS-SEM approach: evidence from Indonesia
| Date | 21 December 2019 |
| Pages | 281-306 |
| Published date | 21 December 2019 |
| DOI | https://doi.org/10.1108/JABS-03-2019-0086 |
| Author | Citra Kusuma Dewi,Zurina Mohaidin,Mohsen Ali Murshid |
| Subject Matter | Strategy,International business |
Determinants of online purchase intention:
a PLS-SEM approach: evidence from
Indonesia
Citra Kusuma Dewi, Zurina Mohaidin and Mohsen Ali Murshid
Abstract
Purpose –The purpose of this paper is to identify the factors affecting consumers’online purchase
intention and to explore whether there was any significant difference between the path coefficients for
males and females.
Design/methodology/approach –Data werecollected by distributing questionnairesto 668 Indonesian
consumers who were actively using the internet. The data were analyzed using partial least squares
structuralequation modeling (PLS-SEM)and multi-group analysis (MGA) in SmartPLS3.0 software.
Findings –Results show that performance expectancy, effortexpectancy and personal innovativeness
are three influentialfactors and have a higher path coefficient in both the maleand female groups. Anxiety
shows a negative and significant relationship withonline purchase intention for female consumers than
for male consumers.Furthermore, the results of MGA analysis indicatethat most factor coefficients in the
determinantsof online purchase intentions are not significantlydifferent between males and females.
Practical implications –These results help the web retailers to consider the important factors in their
strategies when they make strategic decisions as key factors affectingonline buying intention. Besides
this, the strong relationship between anxiety and intention for females has important implications for
managers anddesigners should pay attention to this factor when designingthe content on their business
website.
Originality/value –Even though several marketing scholars discuss the factors influencing online
shopping behavior, a few studies haveshown the role of anxiety and personal innovativeness and their
effect on online purchasingthat fitted as supplements into the Unified Theory of Acceptance and Use of
Technology(UTAUT). In addition, so far, no studies have effectively made a comparativeanalysis across
gender, i.e.are personal and UTAUT factors in the determinants of onlinepurchase intention significantly
differentacross gender?
Keywords UTAUT, Purchase online intention, Male, Female, Indonesia, PLS, Comparative analysis,
Behavioural intention, Process innovation
Paper type Research paper
Introduction
Over the years, the emergence ofthe online shopping industry has attracted the attention of
researchers and practitioners in the world to obtain a better understanding of its
applications with respect to buying online by region (Statista, 2019a,2019b,2019c). The
growing online shopping market allows customers to use information technology with the
aim of doing the shopping activities, how easy it is to use and what are other people
perceptions about the system (Pahnila et al., 2011;Yang and Forney, 2013). It provides a
broad range of benefits such as time-saving, great promotions, wide product ranges and
lower and competitive prices, which significantly provoke online purchase intentions (Celik,
2016;Celik, 2011;Liu et al.,2013;Zhou et al.,2007). According to the data gathered by
eMarketer (2014), the retail e-commerce sales increased to $2.304tn in 2017, which
Citra Kusuma Dewi is
based at the Graduate
School of Business,
Universiti Sains Malaysia,
Penang, Malaysia and
School of Communication
and Business, Telkom
University, Bandung,
Indonesia. Zurina Mohaidin
is based at the Graduate
School of Business,
Universiti Sains Malaysia,
Penang, Malaysia.
Mohsen Ali Murshid is
based at the Graduate
School of Business,
Universiti Sains Malaysia,
Penang, Malaysia and
Faculty of Administrative
Sciences, Thamar
University, Dhamar, Yemen.
Received 16 March 2019
Revised 5 June 2019
Accepted 17 June 2019
DOI 10.1108/JABS-03-2019-0086 VOL. 14 NO. 3 2020, pp. 281-306, ©Emerald Publishing Limited, ISSN 1558-7894 jJOURNAL OF ASIA BUSINESS STUDIES jPAGE 281
corresponds to a 24.8 per cent increase with respect to the year of 2016. eMarketer (2015,
2014) reports show that digital retailsales in the Asia-Pacific region are growing 10 per cent
faster compared to the worldwide average rate and indicate that over half of online retail
sales happen in the Asia-Pacific region. This indicates a vibrant e-commerce in the Asia-
Pacific region driven by China, India and Indonesia as major e-commerce players with the
latter two leading with 129.5 per cent and 65.6 per cent, respectively, in 2015 (Kalia et al.,
2016).
As for Indonesia, the e-commerce market is expected to soon become the third biggest in
Southeast Asia (Kshetri, 2018). Statistics estimates show that internet retail in Indonesia has
grown 60-70 per cent annually since 2014 andis set to rise from $8b in 2016 to $60b by the
end of 2022 (Macquarie Research, 2017). In addition, most online consumers (79 per cent)
use mobile devices for e-commerce (Hoppe et al.,2016). Because of the booming e-
commerce market in Indonesia,most global companies are focused on larger markets such
as Indonesia to an extent that online retailers in Indonesia are adapting their business
model to survive (Embracing the E-commerce Revolution in Asia and the Pacific, EERAP,
2018). A challenge in the massive and growing Indonesian market is to identify potential
consumers through appropriate marketing strategies and market segmentation. Although
the Government of Indonesia’Vision 2020 has put in much efforts such as the learning-
exchange program through leadership workshopsand global logistics service providers
such as e-commerce companies, Amazon and Alibaba, to prosper the virtual shopping
platform, the traditional storeremains as the instinctive choice for the majority of consumers
(Embracing the E-commerce Revolutionin Asia and the Pacific, EERAP, 2018).
The development of e-commerce in Indonesia has changed the behavior of consumersand
even brought out a new type of consumers, namely, the connected consumers, and their
behavior will shape the future ofthe retail market, specifically the online retail market. Based
on The Connected Asian Consumer research in 2017, these types of consumers have
increased in number from year to year in Asia, including Indonesia. These types of
consumers are experienced with the internet and more innovative than those in the past
(Keimas, 2017).
Unfortunately, there are some Indonesian consumers reluctant to use the internet for
purchasing and it has to hamper the growth of the e-commerce activities in Indonesia
(APJII, 2017; Suwan and Lily, 2017). Even the number of Indonesia’s internet users has
risen sharply over the past few years (Statista, 2019a,2019b,2019c), 36.5 per cent of them
have never done purchasing on online as reported by the Indonesian Internet Service
Providers Association (APJII, 2016). This condition will restrict the development of e-
commerce as targeted by the government. However, there is the dearth of research that
examines the key factors influencing the online shopping intention and profiles of
Indonesian e-shoppers (Primabud and Samopa, 2017). To gain the advantage of this
tremendous opportunity, web businesses should identify online customer’s shopping
motivations.
Against the rise of e-commerce activities, it is important to identify the factors influencing
consumers’intention toward the online purchase; recent conceptual and empirical
researchers examined online purchasing behavior pertaining to e-commerce applications
and industries, in more detail, in particular in the context of the online shopping behavior
(Chang et al.,2016), intention to use internet marketing (Tan et al.,2013), online purchase
intention of content services (Wang et al., 2013), mobile shopping adoption (Yang and
Forney, 2013) and online hypermarket shopping (Yeganegi and Elias, 2016). Even though
many studies have been done in the online retail shopping context and Unified Theory of
Acceptance and Use of Technology(UTAUT) has been tested, there is a dearth of research
on how variables of the UTAUT content and other variables affect purchase intention,
whereas UTAUT antecedents play in (Bashir and Madhavaiah, 2015;Chang et al.,2016;
PAGE 282 jJOURNAL OF ASIA BUSINESS STUDIES jVOL. 14 NO. 3 2020
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