THE IMPACT OF INFORMATION OVERLOAD ON CONSUMERS’ ONLINE SHOPPING BEHAVIOR

ACASE STUDY OF JUMIA UGANDA

CHAPTER ONE

1.0 Background

The evolution of Information systems  has a long history however can be specifically traced from the invention of Herman Hollerith’s  census tabulator which was Invented to process the 1890 U.S. census this brought the first step in automation and development of the information systems Era. According to Pearlson et al., (2016) the UNIVAC I, was the first computer installed at the U.S. Bureau of the Census in 1951 which helped in administrative duties while in general electric the computers were installed for commercial purposes in 1954 this later paved way for the full scale adoption of personal computers globally in 1970s.

Information system has progressed through personal computer era to client server era and currently to enterprise internet, this has been spearheaded by the United States military department since 1945 whose main goal has been to eliminate communication barriers and enable better performance; however, this technological advancement has been adopted by most governments across the globe to help in the improvement of performance (Kim et al., 2009).

According to Ricci et al., (2015) the adoption of internet can be traced back with the invention of the World Wide Web in 1991. This gave way to the adoption of internet in government organizations like in including I Business.

Adoption of computers in Africa can be traced in 1960 with the introduction of the first IBM 1401 data processing system in Johannesburg South Africa which was installed in the IBM Service Bureau and was first unveiled in October 1959 (Dwivedi et al., 2015).

According to Barry Silverstein, (2002) Internet makes life simple and innovative. People are doing business online and trade has become more easy and fast due to this. Internet provides new ways to promote business. Website becomes the essence of online business as to show their services and products. Internet gathers all competitors and consumers in one place. It brings new lane to promote, advertise products and services in market.

Other African countries started using computers after South Africa especially by the late 1990s most of the government across the sub-Saharan Africa started adopting information systems in the running of the daily activities and as of 2017, Africa had more than 450 million internet users with specific countries like Nigeria individually having 98 million users and Egypt having Since the creation of the World Wide Web, people have gradually used the Internet for searching, learning, researching, sharing, and making sense. As a result, people are now increasingly dependent on online services to fulfil numerous types of information requirements. The transition from using the site only for searching based on single questions to using it to meet their information needs has been made more complicated by filtering. Nonetheless, the primary goal is to obtain information using several ranking documents for a specific query accurately and conveniently. Online search engines and other search tools are used. The study of the actual search process by the users who conduct a knowledge search directly is an essential aspect beyond the current scope of the search engines. Although search engines have developed more intelligently to keep track of the user search history and interests, so that searches are easily recommended and research findings customized, they do not rely on the user search mission.

Total global E-commerce sale in 2011 have grown to Euro 690 billion (USD 961 billion) and recorded an increase of 20 % with an estimation of increase in the coming years and to cross the 1 trillion Euro mark in 2013. Asia pacific region is leading in terms of growth as compared to mature markets like US, UK, Japan and European countries. Asia Pacific recorded 130 % growth specially China in 2011. The online retailing is becoming an integral part of an economy and country and worldwide increasingly seeing trust and confidence in purchasing online. (AadWeening, 2012)

According to Hoyer & MacInnis, 2010), when consumers have less knowledge of the product, personal resources tend to be used more to determine their choices of the products, however it has to be noted that around 4.62 billion people around the world now use social media, 424 million new users have come online within the last 12 months. The average daily time spent using social media is 2h 27m, this indicates that almost 70% of the global population is online and this affects their choices in choosing what they will purchase.

Consumers can be motivated by getting others’ opinions. Also, for products having hedonic and symbolic meanings such as fashions, music or furniture, consumers prefer to benefit from personal resources because they fear that they may be criticized by others for buying or using these products (Hoyer & MacInnis, 2010). Considering that User-Generated Content (UGC) is a very important personal resource, it is valuable to examine a consumer’s information search and evaluation process in UGC environments.

Despite its benefits, the information searching process via online channels could create some problems. One of the most outstanding problems is the huge amount of information that leads to the information overload created by the existence of the internet (Hawkins & Mothersbaugh,, 2010).

Global ecommerce sales are expected to total $5.5 trillion worldwide in 2022. This number is expected to continue growing over the next few years, proving that ecommerce is becoming an increasingly lucrative option for businesses. The total global retail sales in 2022, 20.3 percent is expected to come from online purchases. That is, more than $0.22 of every $1 spent on retail goods this year will be done over the internet. Online sales are expected to continue rising and take a larger piece of the retail pie. By 2025, it’s estimated that world retail ecommerce sales will exceed $7.3 trillion and the overall ecommerce share of retail sales will hit 23.6 percent (Economist, 2022).

The information processing capacity differs from one individual to another. Accordingly, the amount of information which is greater than the processing capacity leads to negative results in the decision-making functions of individuals. This is referred to as “Information Overload” (Eppler and Mengis, 2004). Huge amounts of online information and the convenience of obtaining the information lead to the problem of information overload. That overload leads to confusion and delays in decision making, sometimes even to postponing the act of buying.

1.2 Statement of the problem

The current consumers’ have got access to multiple information sources, some of these information sources include social media platforms like; facebook, wattasp, istagram, google, yahoo website, snapchat, Tiktok,twitter , newspapers , television sets. All these provide superfluous information. However the advent of social media has led to the global rise in Fake news whose intention is to mislead the public and the clients. To control fake News is something that both the government and the social media companies have been trying to fight with little or no success sometimes.

However in the age of superfluous information, the consumers are also faced with the challenge of correct decision making. This to a greater extend affects the decision making of the consumers, specifically their ability to make a good decision.

1.3 Objectives of this study

1. To examine the influence of consumers knowledge on consumers behavior.
2. To establish the role of information on purchase intention of consumers.

• To examine the role of Consumer Knowledge and Purchase Intention

1.4 Hypothesis

H₀:  consumers’ knowledge doesn’t influence consumers’ behavior

H₁: There is no relationship between availability of information and purchase intention of consumers.

H₂: Consumer Knowledge does not influence Purchase Intention

1.5 Scope of the study

This will be divided into different sections;

1.5.1 Time scope;

The study will be carried out from the stipulated time by the institution

1.5.2 Geographical scope

The study will be carried out in Kampala, specifically in the Headquarters of Jumia.

1.5.3 Content scope

The scope of the study will include;

The scope of the study will include; consumers knowledge on consumers behavior,  the role of information on purchase intention of consumers, and the role of Consumer Knowledge and Purchase Intention.

1.6 Significance of the study

The study will be significant in the following ways; in examining the influence of consumers’ knowledge on consumers’ behavior.

It will provide the policy makers with information regarding the role of information on purchase intention of consumers.

The study will provide information to the future scholars on role of Consumer Knowledge and Purchase Intention

CHAPTER ONE

LITERATURE REVIEW

2.0 Introduction

This section will discuss what other scholars have written about the impact of information overload on consumers’ online shopping behavior, but specifically in line with the study objectives; to examine the influence of consumers’ knowledge on consumers’ behavior, to establish the role of information on purchase intention of consumers and to examine the role of Consumer Knowledge and Purchase Intention

2.1 Consumers’ knowledge on consumers’ behavior

According to Ajuwon, (2015) Knowledge has become one of the most highly valued commodities in the modern economy. Further, knowledge is considered the principal tool of competitiveness and innovation in the composition of commodity chain to the broader processes of regional and national economic development. In line with Tarhini et al., (2015) the new paradigm is that, once consumers have knowledge of the product they become greatly empowered to make better choice and avoid manipulation from sellers.

Some of the most significant changes are the growing importance of knowledge as a catalyst of empowering consumers in the global community, the revolution of information and communication technology (ICT), the integration of the global labour market and worldwide socio-political transformations (Lwoga et al., 2016).

Access to and production of knowledge are essential prerequisite for participation in the global economy as noted by (Lwoga et al., 2016).

Information and communication technologies have significantly increased the speed of production, use and distribution of knowledge, thus making a country’s economic and social wellbeing dependant on how quickly it can adjust its capacity to share and generate knowledge.Transformations brought to different firms as a result of information systems offer many potential opportunities for both developed and developing nations (Komba et al., 2016). However, on the negative side, they also pose serious threats, and especially for developing nations. There is ample evidence that processes of globalization and the ascent of Manuel Castell’s ‘Information Society’ have given rise to new problems, such as the growing knowledge gap and digital divide between the information rich and the information poor among and within nations.

Knowledge Management (KM) has attracted the attention of researchers over the last decade since it is considered an important tool to achieve innovation and sustainable competitive advantage as consumers have knowledge of what they need to consume they are self relient  (Meeker, 2015). Takieddine & Sun (2015) noted that in highly unstable economies the only sure source of lasting competitive advantage is knowledge.  Firms that adopt knowledge management practices perform better than competing firms that do not (Bayero, 2015), on the same line of thought, Ukachi, (2015) further asserts that knowledge management practices have been implemented in different industries both service and manufacturing to enhance better performance and increased output.

The adoption of computers in education is not a new phenomenon, Ahmadi (2013) asserts that in the 1970’s, its promoters claimed that it would transform and save education.

According to Ludeman & Erlanson, (2013) the late 1980’s saw a growing shift towards computer integration which emphasized the use of computers in most of the government’s daily work like the preparation of reports, accountability and monitoring of government projects which changed from manual to automated.

According to Busagala (2013) 1990’s saw a heightened focus on increasing the use of computer technology in Health, defence and Education departments of most governments across the globe., the author further notes that there is growing attention and pressure to implement technology in education, one of the most significant features of the technological or digital era of much relevance to education is the Internet.

2.4The Information Systems infrastructure on consumes behavior

Wachira(2015) the use of computer systems software to determine the behavior of consumes is what is being done now days by major global players. Firstly, the computers improve the level of coordination between sellers and consumers.

Wachira  (2015) further contends that Information systems infrastructure also improves on speed and reliability of information to the consumers’. Organizational transfer and processing of information among members (Lavers & Hickey, 2016).

The use of internet services as an effective Information systems infrastructure in organizations to hep in the coordination of information with consumes has helped organization in being able to reliabily transfer information to the consumers (Ukachi, 2015).

Lavers  & Hickey  (2016) indicates that Nigerian government agencies have been blamed for poor response to the needs of the citizens and high costs of the paper work involved in the government administration.

Rotich  (2015) also believes that the adoption of computers  in the organization is to provide better and an effective communication between different departments in the organization and also between the organization and the outside world. The government’s effort to use computers in the monitoring of public agencies is to ensure that business between the government and the citizens is effective and fast.

Wilson et al., (2015) states that the use of websites is to enable long-term relationship between the organization and the customers, he further asserts that websites is where customers keep checking on the major changes in the organizational products. The public sector websites provide information to the customers about the products the organization has.

Government across Sub-Saharan Africa have acquired advanced software in key government agencies like Taxation and water management systems, this is to enable government manage public utilities better.

Paul & Pascale(2013) the government of Ghana was able to realize an increase in revenue collection due to the use of advanced software and internet services, using this system, the public could pay for their taxes online. With the use of systems infrastructural facilities, Ghana was able to realize an increase in revenue collection by 22% in 2017 this was estimated at GH¢13.2 billion against the target of GH¢12.8 billion.

Information systems used in the

Electronic Data Interchange (EDI)

EDI is a technique based on agreed standards, which enables computers in different organizations to successfully send business information of transaction from one to another. They emphasize that EDI reduces on the lead-time simply because transactions are faster and more accurate (Lysons and Farrington, 2006).

According to Chaffey (2007), EDI involves business transactions like, placing orders, invoices, delivery and payment transactions. EDI works according to standards implying that the organizations using it have to agree on the systems and the soft ware that they are to use (Chaffey, 2007).

Chaffey (2007) identifies that EDI approach is associated with Electronic Point of Sale (EPOS) he cites an example in a supermarkets, when a product is purchased the check out operator scans the bar code on the label and automatically registers the price on the cash. In the same way in case of stock replenishment, the machine can order automatically as the stock reaches the re order level.

According to Sollish et-al 2007, shows that EDI. Works as follows;

• Company A sets a purchase order using its internal business software
• EDI soft ware transforms the order from the internal format to a standard 850-purchase order document format.
• Company A sends the 850 standard purchase orders to company B over a third party value added network.
• Company B receives 850 purchase order document and will translate it from EDI to its proprietary format.

Electronic Fund Transfer (EFT)

According to Lysons and Farrington (2006), EFT is based non-electronic transmission of receipts and payments between banks and their customers or the purchasers and suppliers. It enables paperless payments to be made to suppliers “here money travels not paper”.  EFT involves automated digital transmission of money between organizations and banks. Lysons and Farrington (2006) state that the buying organization will make payment to the supplier using EFT, in a more convenient and accurate way.

According to Chaffey (2007), EFT is associated with the following advantages;

• Reduction of costs due to elimination of cheque writing receipt canceling.
• Increased speed of fund transmission. This is fast, accurate and safe.

However, it is also associated with some disadvantages like; Difficulty to implement especially where purchasers and suppliers may prefer to make and receive payments by cheque. It may cause problems especially with digital signatures.

Electronic Mail (e-mail)

E-mail is a process by which letters, orders or other documents are sent by a computer along telecommunication lines to appear on the Visual Display Unit (VDU) at their destination. They emphasize that incase buyers use this technique in the process of buying, sending and receiving of messages can take minutes instead of days. (leanders et-al, 1998)

According to Chaffey (2007), e-mail will be based on sending and receiving of electronic messages, he states that e-mail will be available in the internet for over 20 years.

Chaffey (2007) emphasizes that the recent innovation is the use of websites, which provide free         e-mail facilities, and does not require any software other than the web browser.

Kennedy (2000), describes internet based on e-mail and stresses that the internet messages are sent through e-mail and thus gives examples like;

• Hot mail (www. hot mail.Com)
• Yahoo mail! (www.yahoo.com)

Kennedy (2000), further categorizes e-mail broadly into in-bound and outbound. Inbound e-mail is received from outside the organization such as from suppliers. Outbound e-mail is sent from the organization to another an example is from the buyer to the supplier, e-mail reduces on costs associated with movement thus resulting to efficiency on procurement activities.

Smart Cards.

Smart cards are integrated circuit chips used to store customer specific information including electronic money. They have ability to provide intelligence and store significant amount of information of up to 20 pages of text.  Smart cards will be used to purchase goods or services, store information, and above all, they can be availed to all potential users.  (Lysons 2006)

The following are the benefits of using smart cards;

• They offer convenience since they are of the same size like credit cards.
• They store reasonable amount of information and thus will be easier to be accessed by the organization for use at any time.
• They are economical and thus reduce on the handling fraud.
• They provide confidentiality and security of information

According to Enslow (2006), smart cards provide effective and efficient means of storage and compatibility, especially with EDI, which facilitates easy movement and exchange of information. The global use of smart cards will depend on the introduction of global payment standards that are currently being developed.

Electronic Hubs (E-hubs)

This device connects several networks together. As used in e-business it means a central repository exchange such as the star network. In the network, a server is a control computer that holds database and programs and programs for many computers (Herper and Thompson 2005). According to Herper and Thompson (2005), the buyers PCs will be connected together with the suppliers PCs and information regarding business transactions will be conducted, since all the information is kept in the server computer.

E-Market place

Lysons (2006) asserts that, e-market is a web site that enables procurement officers to select the best suppliers in the market electronically. In this situation, a procurer is in control especially in open market places. This enables procurer to evaluate all potential suppliers for a particular product or service and make informed buying decisions regarding what and where to buy.  This brings efficiency in procurement since the best-evaluated bidders will be given contracts to supply.

According to Chaffey (2007), e-market is applicable where; the market is large enough, product specification and information are subject to rapid changes, suppliers have difficulties in comparing similar products from different vendors, the cost of locating, appraising and evaluating suppliers is high.

Electronic- catalogs

E-catalogs are web pages that provide information on products and services offered and sold by the vendors. (Lysons 2006). According to Lysons (2006), e-catalogs mainly include; sell side catalogs; buy side catalogs and third party catalogs, E-catalogs support online transactions especially ordering and payment capabilities.  The advantages of e-catalogs includes; facilitation of real time communication between buyers and sellers; Allows room for the development of closer buyer-supplier relationship due to improved vendor services. Enables suppliers, respond quickly to market conditions by adjusting   repackaging (Lysons, 2006). According to Accenture (2006), e-catalogs, reduces procurement fraud by providing easy communication and the real product in the market.

CHAPTER THREE

RESEARCH METHODOLOGY

3.1 INTRODUCTION

This chapter covers research design, study population, sampling design, sources of data collection, methods of data collection, procedure of data collection, data quality control, data processing, presentation, and analysis and finally limitations anticipated.

3.2 Research design

The study will use descriptive research design. The researcher will employee descriptive research design since it provide the opinion of people about the subject knowledge on the impact of information overload on consumers’ online shopping behavior.. The design will availe the researcher with comprehensive information about the research study as a way to get solutions. Descriptive approach, in this case will be used because the study seeks descriptive analysis of information.

3.3 Study population

The population of the study will be 25 people who will include; the staffs of Jumia Uganda from different departments. The researcher will choose to take the above study population due to insufficient resources to manage a large number of respondents.

 3.4 Sampling design.

Sampling design will consist of the sampling size and   sampling techniques.

3.4.1 Sampling size

The population under consideration will be 25 staffs from different department of Jumia Uganda, like Procurement department, stores department, finance department, marketing and other department. The researcher will consider members of staff who have worked for at least six months and above in the organization.

3.4.2 Sampling technique.

The sampling technique will be purposive sampling and this will be used to select workers form Procurement department, stores department, finance department, marketing. Simple random sampling will also be used to select respondents from other department.

Random sampling will be also be used in order to give equal chance to population of the study and business firms to be selected. The method will be chosen to save cash and time.

3.5 Sources of data collection

This will include both primary and secondary sources

3.5.1 Primary sources

The primary data will be obtained through questionnaires. This involves distributing questionnaires to chosen respondents. Primary data will be used to compare whether what was in the literature matches with respondent’s views.

3.4.2 Secondary data

The researcher will obtain data from written documents like reports which has already been compiled by other persons and will be obtained from journals, text books, magazines, and various documents through review of related literature from 1990 up to date. This will be used to supplement on primary data and also to compare primary data with literature review.

3.6 Methods of data collection

This will include questionnaires and interviews that will be used to gather data on the impact of information and communication technology on procurement fraud in Jumia Uganda.

3.6.1    Questionnaires

The researcher will form close ended and open ended questionnaires designed to collect data on the impact of information and communication technology on procurement fraud in Jumia Uganda, hat will be sent to respondents for them to answer. The researcher will collect questionnaires back for analysis; data will then be coded into understandable and meaningful information. This method will be chosen because it is easier to gather information; it gives the respondents enough time to answer the questions since questionnaires will be dropped to the respondents and then collected after 10 days.

3.6.2 Observation

This involved a researcher going to the field, and observe critically what will be in the field, recorded the finding and then conclusion will be drawn. The method give more reliable and accurate information. It gives first-hand impression that removes doubt, it enables researcher to clarify some questions on the spot.   

3.7 Research variables

The variables of the study will be independent and dependent variables. Information and communication technology will be independent variable while procurement fraud will be a dependent variable.

3.8 Procedure for data collection.

The researcher will acquire an introductory letter from the University and will be presented to the organization where the research will be conducted from.

3.9 Data quality control

The detailed information concerning the study will be analyzed in a way that reflected what will be answered by the respondents. This will help the researcher to come up with accurate and correct results about the study variables.

 3.10 Data analysis and presentation

The findings of the data will be presented by use of tables, by arranging describing data in relation to the objectives of the study. Editing will be done to ensure completeness of questioner and to eliminate misrepresentation of questionnaires.

3.11 Ethical consideration

The information got will be kept confidential and strictly used academic purpose in writing the report.

3.12. Anticipated limitations.

The researcher will face the following limitations in the process of conducting the study;

• Limited time to conduct the study because of other activities however this will be solved through proper planning and time budgeting.
• Language barrier between the researcher and the respondents and this problem will be solved through encouraging respondents to guide them in terms of narrating.
• Limited financial support to the study this was solved through borrowing from fellow students.