Sales Distance and Choice of Online Distribution Channel: A Case Study of Mongolian Consumers

• Main Authors: JADAMBA,SOLONGO, 彩容
• Other Authors: Carol Troy
• Format: Others
• Language: en_US
• Published: 2016
• Online Access: http://ndltd.ncl.edu.tw/handle/8zn5hz

碩士 === 大葉大學 === 國際企業管理學系碩士班 === 104 === Online sales can be transacted at varying distances from the consumer. The most distant are cross-border transactions carried out entirely over the internet, with all product information conveyed electronically, and no face-to-face contact between customers and sales staff. A closer option is “click and mortar” shops, domestic businesses that allow consumers to buy products either on the internet or from an associated brick-and-mortar store. When a desired product is available from both a cross-border vendor and a click-and-mortar shop, the customer faces a choice of distribution channel. The customer then decides not what to buy but how to buy what they want. In developing countries such as Mongolia, this choice of distribution channel poses interesting tradeoffs for consumers. In Mongolia, the large purely online shopping sites, such as Amazon, are all foreign. The most popular domestic online sites are click-and-mortar shops, which have features of both online and brick-and-mortar shops. This study investigates the factors that influence Mongolian consumers’ choice of online distribution channel in the purchase of international brand name products. Using a Likert questionnaire, we obtain data from 302 respondents in the capital city, Ulaan Bataar. The survey assesses respondents’ willingness to purchase goods through two channels at differing distance from the consumer: MMARKET and Amazon. The data are incorporated into a probit model in which the dependent variable is channel choice and the independent variables represent the consumer’s need for a “close-up” shopping experience, characterized by “face to face” contact with sales staff and physical/tactile handling of products to gain haptic information. The dependent variable is represented by either absolute willingness to shop (e.g., at MMARKET, when no alternative channel has been specified) or relative willingness to shop (e.g., at Amazon, when the alternative is MMARKET). Since click-and-mortar shops are the most proximate to the user and foreign online shops are the most distant, the latter measure represents the consumer’s preference for the more distant sales channel. The control variables include customer demographics, technological experience, and other factors known to influence online shopping behavior. The models output shows that trust is the most important factor influence willingness to shop when Mongolians favor both distant and closer shopping channels while they also assume usefulness with ease of use is determinant. Our result indicates that Mongolians consider haptic is important they prefer closer domestic option while they assume haptic is unnecessary distant option is their choice. Furthermore, higher face-to-face preference leads Mongolians to shop at Amazon. Demographic factors such as income, education, professional area also exert a powerful influence.