A PROJECT REPORT ON

CUSTOMER PERCEPTION TOWARDS ONLINE GROCERY

Dissertation submitted in partial fulfillment of the requirements for the

award of the two-year full time degree of
POST GRADUATE DIPLOMA IN MANAGEMENT
By
SAURAV KUMAR
GM20134

Under the guidance of

Dr. Amit Kumar
(Assistant Professor -Marketing)

GL BAJAJ INSTITUTE OF MANAGEMENT AND

RESEARCH
GREATER NOIDA, PGDM INSTITUTE
2020-22
 DECLARATION

I hereby declare that “CUSTOMER PERCEPTION TOWARDS ONLINE

GROCERY”

is the result of the project work carried out by me under the guidance of Dr. Amit

Kumar, Assistant Professor- Marketing, in partial fulfillment for the award of two-

year full time degree of POSTGRADUATE DIPLOMA IN MANAGEMENT from

GL Bajaj Institute of Management. PGDM INSTITUTE, Greater Noida.

I also declare that this project is the outcome of my own efforts and that it has not been

submitted to any other university or Institute for the award of any degree or Diploma or

Certificate.

Place: Greater Noida Name: Saurav Kumar

Date: 25 Jan2022 RollNo: GM20134

 GL BAJAJ INSTITUTE OF MANAGEMENT AND RESEARCH.

PGDM Institute

GREATER NOIDA

CERTIFICATE

This is to certify that the dissertation titled “Customer Perception Towards online Grocery” is

an original work of Mr. SAURAV KUMAR bearing Roll Number GM20134 and is being

submitted in partial fulfillment for the award of two year full time degree of POST

GRADUATE DIPLOMA IN MANAGEMENT from G L Bajaj Institute of Management

and Research PGDM Institute, Greater Noida.

The report has not been submitted earlier to this University / Institution for the

fulfillment of the requirement of a course of study.

 ACKNOWLEDGEMENT

I owe my gratitude to many people who helped and supported me during the entire

Dissertation Report.

My sincere thanks to Dr. Amit Kumar , ( Assistant Professor - Marketing) the Faculty

Guide of the project, for initiating and guiding the project with attention and care. He always

has been available for me to put me on track from time to time to bring the project to its

present form.

I am highly thankful to the Director Dr. Sapna Rakesh of the institute for her support

,motivation and continuous efforts in providing us the better learning environment and

opportunities to groom ourselves as per the expectations of the corporate world. Without her

support, it would not be possible for us to successfully complete our Dissertation Report.

I also thank all faculty members without whom this project would have been a distant reality.

Saurav Kumar

Place:

GreaterNoida

Date:25Jan2022
Executive Summary

Internet and Information technology have made tremendous contributions for business
transformation witnessed nowadays all over the world. This has given birth to E commerce
which encompasses several pre purchase and post purchase activities leading to exchange of
products or service or information over electronic systems such as the internet and the other
Telecommunication networks.

Analyzing the competitive advantage of E-Commerce it is observed that E-Commerce

enables simpler, faster and efficient business transactions. For developing countries like
India, E-Commerce offers considerable opportunity for growth.

E-commerce leads to a boon for the current economic downturn. As India's e-commerce
market is worth about Rs 50,000 crores in 2011. About 80% of this is travel related (airline
tickets, railway tickets, hotel bookings, online mobile recharge etc.).

Online retailing comprises about 15%. India has close to 10 million online shoppers and is
growing at an estimated 40-45% per annum.
The rapid growth of e-commerce in India is being driven by greater customer choice and
improved convenience.

As its market penetration accelerated throughout the COVID-19 pandemic, so have customers’
expectations. Online shoppers now expect the service they receive online to rival, or exceed, the in-
store experience.

The project will first study the attitude of customers towards online shopping, also
determining the factors which influence the consumer to purchase goods and services.

The second half of the project will depict the attributes of online shopping influencing the
purchase decision by the respondent. It will also determine the issues regarding online
shopping.

The third part of the project determines the purchase decision with respect to grocery. It will
determine the place preference of grocery shopping with respect to price, quality, variety,
proximity and offers/ discounts.

The project will also recommend the business operational plan which works with contracting
dealerships with the local kirana stores
Industry Introduction

The Internet is changing the way consumers shop and buy goods and services, and has
rapidly evolved into a global phenomenon. Many companies have started using the Internet
with the aim of cutting marketing costs, thereby reducing the price of their products and
services in order to stay ahead in highly competitive markets.

Companies also use the Internet to communicate and disseminate information, to sell the
product, to take feedback and also to conduct satisfaction surveys with customers.
Customers use the Internet not only to buy the product online, but also to compare prices,
product features and after sale service facilities the will receive if they purchase the product
from a particular store. Many experts are optimistic about the prospect of
online business. In addition to the tremendous potential of the E-commerce market, the
Internet provides a unique opportunity for companies to more efficiently reach existing and
potential customers
.
Although most of the revenue of online transactions comes from business-to-business
commerce, the practitioners of business-to-consumer commerce should not lose confidence.
It has been more than a decade since business-to-consumer E-commerce first evolved.
Scholars and practitioners of electronic commerce constantly strive to gain an improved
insight into consumer behavior in cyberspace.

Along with the development of E-retailing, researchers continue to explain E-consumers

behavior from different perspectives. Many of their studies have posited new emergent
factors or assumptions which are based on the traditional models of consumer behavior, and
then examine their validity in the Internet context.
Models of E-commerce

Business-to-Business (B2B):

B2B e-commerce is simply defined as e-commerce between companies. This is the type of e-
commerce that deals with relationships between and among businesses. About 80% of
ecommerce is of this type, and most experts predict that B2B ecommerce will continue to
grow faster than the B2C segment. Eg: indiamart.com, eindia business.com, tradeindia.com
etc.

Business-to-consumer (B2C):

Business-to-consumer e-commerce, or commerce between companies and consumers,

involves customers gathering information; purchasing physical goods (i.e., tangibles such as
books or consumer products) or information goods (or goods of electronic material or
digitized content, such as software, or e-books); and, for information goods, receiving
products over an electronic network.
It is the second largest and the earliest form of e-commerce. Its origins can be traced to online
retailing (or e-tailing). Thus, the more common B2C business models are the online retailing
companies such as flipkart.com Amazon.com, snapdeal.com etc

Business-to-Government (B2G):

Business-to-government e-commerce or B2G is generally defined as commerce between

companies and the public sector. It refers to the use of the Internet for public procurement,
licensing procedures, and other government-related operations. This kind of e-commerce has
two features: first, the public sector assumes a pilot/leading role in establishing e-commerce;
and second, it is assumed that the public sector has the greatest need for making its
procurement system more effective.

Web-based purchasing policies increase the transparency of the procurement process (and
reduce the risk of irregularities). To date, however, the size of the B2G e-commerce market as
a component of total e-commerce is insignificant, as government e-procurement systems
remain undeveloped.

Consumer-to-Consumer (C2C):

Consumer-to-consumer e-commerce or C2C is simply commerce between private individuals

or consumers. This type of e-commerce is characterized by the growth of electronic
marketplaces and online auctions, particularly in vertical industries where firms/businesses
can bid for what they want from among multiple suppliers. It perhaps has the greatest
potential for developing new markets. Online auction sites eBay, Yahoo! Auctions are a
couple of examples of C2C websites.
M-commerce

M-commerce (mobile commerce) is the buying and selling of goods and services through
wireless technology-i.e., handheld devices such as cellular telephones and personal digital
assistants (PDAs).

Mobile Commerce is any transaction, involving the transfer of ownership or rights to use
goods and services, which is initiated and/or completed by using mobile access to computer
mediated networks with the help of an electronic device.

Mobile Commerce in India

Mobile is growing in India with more than 800 million subscribers across the country. The
advancement in terms of adoption of smart phones with 3G enabled services is happening at a
rapid pace. This of course has opened up the gates to mobile advertising, mobile application
development and mobile commerce in India. According to BuzzCity's latest report, India is
top performing mobile advertising region in the whole of Asia. The growth in mobile
advertising globally is tremendous with ads served on a year-on-year growth of 139%. With
respect to some number crunching, more than 126 billion ads were served in 2011, compared
with 52 billion in 2010.

In India, Mobile Commerce is still in the development phase as the use of mobile phones for
carrying out transactions is very limited. However, the development is taking place at a nice
speed and in the coming years, Mobile Commerce is most likely to make its presence feel as
companies and businesses have started understanding the benefits of Mobile Commerce.
Some of the companies have even incorporated this technology. Airtel, ICICI, Reliance are
some of the companies/businesses that are using this technology as their users are allowed to
make limited purchases from their phones. For now, the users are mainly allowed to pay
phone bills, utility bills, book movie tickets, book travel tickets with their cell phones.

However, more services will be introduced in coming years. Security is one of the main
concerns of Mobile Commerce as it's very important to offer secure transactions and this is
the reason why Mobile Commerce is still in the development phase in
India. For now, users are mainly allowed to do Mobile Banking i.e. to access the bank
account with a cell phone in order to pay the utility bills. With the current rate of
development, users will be soon allowed to purchase products, advertise, to take part in
auctions and pay bills with the help of a cell phone, while they are on the move.
Online Shopping In India

The Indian economy is slated to grow by upward of 6 % annually in the next few years which
is among the highest rates of any big emerging economy. And quite a lot of this growth
would be on the back of domestic consumption of goods and services. E-commerce is
emerging at a great level given that organized retail is still not ubiquitous across the length
and breadth of the country with large retail chains making up less than 10% of the market.

E-commerce is helping people in smaller towns in India access quality products and services
similar to what people in the larger cities have access to. It's being forecast that close to 60%
of online shoppers would come from beyond the top eight large cities by the end of this year.
Increasing internet penetration has helped to expand the potential customer pool. Internet
penetration is only about 10% (or about 121 million users) as against about 81% in the US
and 36% in China. However this number continues to rise at a consistent pace because of
falling prices for broadband connections.

Indians are also increasingly taking to mobile devices for not only search but shopping as
well. The number of smartphone users is rapidly increasing in India and with 4G services
about to take off it's expected to get even more people going online. There are currently about
900 million mobile subscribers and this number is expected to touch 1.2 billion by 2015. Of
these about 27 million are estimated to be active mobile internet users. More importantly,
20% users indicated intent to buy products through their mobile phones as against the current
4% and this number is expected to only increase in the next two to three years.

Innovation is helping e-commerce companies break the inertia for online shopping by
offering benefits to customers not traditionally available in a brick and mortar store. Business
models include no question asked return policies ranging from 7 days to 30 days, free product
deliveries and the industry dynamics changing "cash on delivery" model. The last innovation
has really helped unlock the potential as people can now order products and pay when they
get physical delivery of the product.

This has been a tremendous success because Indians are still reluctant to give their
credit/debit card details online and want to have the psychological comfort that they would
actually get the product once payment has been made. These innovations have led to further
innovations downstream as ancillary businesses are developing to support these initiatives.
Some companies have begun to develop support mechanisms for the entire cash on delivery
model and are trying to reach the far flung corners of India, including in the interiors where
traditional logistics companies are still not completely present. The logistics companies are
also shoring up their act and have started to build specific verticals and expertise to address
the requirements of e-commerce companies.

Divyan Gupta is the Founder and CEO of Keshiha Services Pvt. Ltd, a company with
interests in the internet, telecom, healthcare, education and advanced technology businesses
has stated that acceptance of online shopping as a secure shopping mode has also helped to
increase e- commerce uptake.

Currently only about 10 million people do online transactions out of an approximate

population of 200 million credit and debit card holders. However the latest industry report by
First Data Corporation and ICICI Merchant Services indicate that there are about 150 million
users that
are ready for e-commerce.

More importantly, the report indicates that urban Indian consumers are now confident enough
to make online purchases of up to US$500 as against US$40-100 in the recent past. So not
only are the numbers of online shoppers projected to increase but there has been a real
increase in the total value being spent online.

So what happens next for an industry which is retailing everything online- from flowers to
baby products to books, coupons, apparels, music and electronic items to even houses, cars
and jewelry? While this e-commerce play is not like the earlier dot com bubble, there are
clear signs that order might be coming in amidst all the noise that is out there.

First a slow but sure consolidation is starting to take place in the industry. Experts say that
over the next 12-18 months there would be a couple of multi-product generalists who would
be successful along with a leader in single product category.

Second, Venture Capitalists are starting to be choosy about which business to invest in,
basing their decisions on performance as opposed to future predictions. Valuations which
went through the roof are now returning to normal levels. According to an Avendus report,
about US$829 million was pumped in the sector in the first 10 months in 2011. However this
came down to US$16 million in December 2011 and went up only marginally to. US$24
million in January of this year.

Despite all of this, it's been a very impressive story so far. The poster child of the Indian
ecommerce industry is Flipkart.com, a 4 year old venture which modeled itself
afterAmazon.com and is already commanding a valuation of US$ 500 million and is targeting
revenues of US$1 billion in the next two to three years. All of this has caught the attention of
Amazon.com which entered the market in February this year. It came in through
Junglee.com, a price comparison site and is already amongst the top 10 sites in the country.
Everyone is therefore trying to capitalize before the 800 pound gorilla comes in fully on its
own which is expected to be sometime around Q3/Q4 this year.

There is huge demand for top-notch professional grade web 2.0 consultancy and
development. Very few companies have a long term vision around customer acquisition,
retention and constant conversations. A lot more can be done in understanding the linkages
between design and functionality based on user experience and social integration. However,
to succeed in a tough market like India your company needs to be open to long term strategic
partnerships rather than an upfront "pay for services" model. The upside would be worth its
weight.

India has more than 3,311 running e-commerce centers, according to research conducted by
eBay India for its 2011 census. The Indian web is clouded with e-commerce (B2B, B2C,
B2G, and C2C type business models) start ups and increasing like mushrooms on the lawn.

India- an upcoming super power has more than 100 million internet users which keeps on
growing by introduction of 2G and 3G. They want to be online always by any internet
enabled gadgets. People are moving from street bargaining to online web bargaining. The
common Indian Mentality of ``seeing and believing" or "how it will look" is changing by
introducing some creative business models like "cash on delivery" by major e-commerce
sites.
Shopping has been an obsession of women across the globe. A new shop in the
neighborhood, a new shopping mall in the area, a new brand launched - women are first to
know and first to go. When it comes to shopping, women are more organized (45% of women
come to retail stores with shopping-lists as compared to 27% of men), regularized and they
show some definite trends in their buying behaviors. A woman is more likely to spend time in
a retail store (29%) as compared to her male counterpart (23%).
When a woman visits a retail store or any physical retail store she will consider a few
important factors such as:

● How conveniently the store is located

● Behavior of the staff
● Cleanliness (most of women are obsessed with it)
● Products put at an easy reach so that she can check the label, feel it (if required) and
physically compare it with a similar product from a different manufacturer
● Overall aesthetic decoration of the store
● And most importantly - freebies and discounts available with the products

Naturally, the same woman when she visits an online retail store will look for these factors in
her subconscious mind. She would love to get the same feeling as she derives from the
environment of her favorite retail store. She will unknowingly demand these from your
online shopping store. She would choose to stay and buy from your online store if you can
meet the following:

• Save time: You should give her the navigational freedom and easy roam around
options in your store; give her instantly whatever she wants.

• Get a better selection: Your product should be the best in the designated price
bracket

• Complete product details: Do not describe your products in single words; give as
much detail as possible.

• Better value/offer: Your freebies should be 'useful' enough and the discount should
be noticeable

• Logistics: You must deliver the product right at her doorsteps and nowhere else!

• Flexible return policy: Many times a woman takes a second opinion and you should
respect this nature. Be flexible if she asks you to replace what she has bought.
Online Grocery Shopping

Proving that no sector of the retail market is safe from the online shopping revolution, it is
now possible for the humble hometown grocery store to become digitized and available on
your smartphone, tablet, or computer. Just think: no more long checkout lines, counting the
number of items to see if you qualify for the Express Lane, forgetting your grocery list at
home, or carrying heavy bags up your front steps. Online grocery shopping is dramatically
changing the consumer's relationship with the food market and making a service that may
have once felt luxurious into an everyday convenience.

Ordering Food Online

An online grocery store is a website that allows users to purchase food over the Internet to be
delivered to the person at a later time. Ordering food on the Internet is similar to ordering any
other product--the desired food items can be searched for specifically, or one can browse
through listings of products or sections, similar to sections one might walk through at an
actual grocery store. The products offered by an online grocery store are identical to a normal
grocery store. When one has finished shopping, checkout is made with a credit card, and the
buyer must specify certain hours that he will be available to receive the food for delivery.
Since Internet groceries must deliver the food to the customers, they typically pay a fee for
delivery based on the amount of food they buy.

Benefits of Online Grocery Shopping

The primary benefit of online grocery shopping is convenience. By ordering online, one can
quickly search for the products she needs and order them without having to physically walk
through expansive aisles. It also saves travel expenses and time going to the grocery store.
Considering the wide availability of the Internet, it also means grocery shopping can be done
from remote locations or in the middle of doing other tasks. For instance, using an online
grocery store can allow a person to do all her grocery shopping during her lunch break at
work. It is also very useful for those without a car or who may be physically unable to move
around easily, since the food is delivered right to their doors. The use of online-based grocery
stores is increasing in popularity as more and more people become comfortable with using the
Internet to make purchases.

Disadvantages of Online Grocery Shopping

Perhaps the largest disadvantages of shopping online are that it costs extra money, since food
must be delivered, and that the food ordered is not obtained immediately. If someone were
making a certain recipe and discovered he needed an additional ingredient, he would probably
not be able to order it online and get it quickly enough to finish his dish. In the same way, it
forces a person to plan his food buying in advance of when he will need it--if delivery will
take a day or two, a person needs to plan to have an extra day or two of essential foods
available before he runs out. Another disadvantage is that online shopping forces the
customer to be home during a certain period to collect the food when it is delivered. Also,
online grocery stores will often only cover specific delivery areas.
How Does Online Grocery Shopping Work?

Following are the basic parameters that determine the working of online grocery shopping.

Creating the Website

The most important part of online grocery shopping is the website itself. The website should
have a complete list of groceries that are able to be delivered as well as the prices for each item.

This website should then have a "shopping cart" where a user can add items to a list of things
to be ordered, as well as view and edit items that she is planning to purchase. Finally, this
website should have the ability for the user to enter her address and pay for the order.

Filling the Order and Shipping

The next step is to take the submitted order and use it to collect and deliver the items on the
list. In general, fulfillment of the grocery order needs to be done manually by a stock boy or
other employee.

This process can be made easier by having a well-organized room where the products can be
easily and efficiently located. The stock person should also check to make sure that the items
placed in the order match the list that the user created.

Then, once the order has been compiled, the collection of food needs to be placed in a vehicle
and delivered to the customer.

Restocking and Processing Payments

Clearly, it is critical to ensure that all the items listed on the website are in stock and able to
be shipped. As a result, the stockroom needs to be carefully checked to ensure inventory
levels are sufficient.

Also, it is important to have the ability to obtain and process payments made by credit card.
Also, in order to encourage repeat customers, it can be helpful to require customers to have a
username, which would allow information to be stored. This can also help create "suggested"
carts of food items they commonly purchase.
Indian Players in Online Grocery Shopping

FreshnDaily

Fresh N Daily is Mumbai's first online fruits and vegetable store. Our endeavor is to service
you at the comfort of your home with the best quality products and at the best possible prices.

They procure goods directly from the farmers/ brand owners and ensure there are no
intermediaries. Moreover, unlike a physical store - supermarket/ neighborhood kirana store/
sabziwala - we are an online store. This means that the cost structure is very lean: low rental
costs, low manpower costs, low overheads etc. The prices are therefore the most competitive.

Thirty-year-old Vikas Chauhan, who quit an IT company, has a delivery van that procures
vegetables from local mandi, brands them with FreshnDaily packets and delivers to areas it
has identified as key zones. It has just two delivery boys who supply in key zones. For the
rest, it is tied up with small nooks and corner shops. At Ghatkopar, for example, the helper of
the corner mobile recharge shop collects the vegetables from the delivery van and delivers
them door to door. FreshnDaily pays the errand boy a monthly salary and the mobile shop
gets the boy's services for free. The shop even gets an incentive when deliveries cross Rs
5,000 a day.
Aaramshop.com

New Delhi based start-up Aaramshop.com has launched an e-

commerce site for buying groceries. Still in beta, the website
only caters to New Delhi residents and yet to be commercially
launched.

Daily essentials such as laundry supplies, cereals, butter, jam,

rice, atta (flour), lentils, cooking oil, biscuits, chocolates,
sweets, milk, spices, coffee and tea are available on the
website. The website allows you to search for the nearest
neighborhood local grocery stores - either by name, by pin
codes, location,
maps or view all the *Aaramshops' available and select one. Once this shop is selected,
delivery timings can be chosen. Once the user selects the items needed, adds them to the
shopping bag and checks out, a confirmation email and text message is sent with the amount
and time of delivery.

There is no online bank transaction involved and the user has to pay cash on delivery of
goods by the shop.

They target 25 to 45 year old urban, well-educated and tech-savvy females and males.
Currently operating in Delhi, they have plans to expand its services in 12 cities including
Mumbai, Bangalore, Pune Hyderabad and other metros in coming months. The sales force of
six people will tie-up with retailers. They claim to have roped in more than 100 kirana stores
in its network and are adding a considerable number to it daily and have over 100 FMCG
brands and 32 categories of products.

Vijay Singh, Founder and CEO, AaramShop.com, said that the portal will keep the consumer
much more informed about various other brands that are available for the same product and
also their pricing to enable them to opt for a much better choice for the same. Other than
using Facebook to buy grocery items, users can directly access Aaramshop.com to order
items from nearby grocery stores. The user will be required to create a user identity or
become a member of AaramShop.com by filling in the required details.
Zopnow

Zopnow.com, an online retail store

exclusively aimed to cater grocery
and FMCG needs of people launched
its service in Bangalore. Zopnow
with punch line "Be Lazy, Buy Easy"
plans to deliver grocery items at
consumer's doorstep in less than 3
hours or at a predefined time
specified by the customer.

However, currently zopnow is

offering 1501 products to some
selected areas of south Bangalore. Zop now is founded by serial entrepreneur B.K
BirlaandMukesh Singh, erstwhile CTO, Makemytrip.

According to the company website, it wants to build a customer centric online store that will
leverage the hybrid model of online, call center, mobile application and physical touch.
Zopnow claims to deliver great customer experience by providing customers a convenient
way to shop and in the process cut down the time at the checkout counter, traffic and parking.

At present Zopnow offers cash on delivery (COD) option and are in the process of adding
card, debit card, Sodexo and Ticket Restaurant vouchers, however Sodexo and Ticket
Restaurant vouchers would be applicable only for food items. It offers free shipment for a
minimum order value of INR 500 and above, however shipping cost of INR 30 is added to all
shipments below INR 500.
Farm2Kitchen.com

Farm 2 Kitchen Team is lead by Seema Dholi (Founder & CEO), a woman entrepreneur who
is committed to betterment of lives for Indian families. She started Farm2Kitchen with only
one mission - To enhance the quality of life for Indian families and provide the best customer
service possible.

Farm2kitchen.com, which deals only in organic groceries and textiles, and caters to Gurgaon
and surrounding areas. Founder SeemaDholi, who hails from Pearl Academy of Fashion and
has several other ventures in her basket, such as Divavee and Fashion Per Inch India, wants to
educate local consumers about the benefits of organic groceries and then spread the message
to the rest of the country. Set up in 2011, Farm2kitchen is now looking for funds but even
before that, Seema wants to expand operations and go pan-India.

They support organic farming & agriculture as organic farming is a holistic approach to food
production, making use of crop rotation, environmental management and good animal
husbandry to control pests and diseases.

Some of the cities which will be covered under Farm2Kitchen's umbrella for organic food are
- Organic food stores/shops in New Delhi, Mumbai, Chennai, Kolkata, Bangalore, Gurgaon,
Hyderabad, Pune, Aurangabad, Ahmedabad, Kolkata, Nasik, Vadodara, Gandhinagar
(Gujarat), Visakhapatnam, Chandigarh, Bhopal, Jaipur, Lucknow, Dehradun,
Thiruvananthapuram.
Veggi Bazaar

Veggibazaar is India's first online vegetable & fruits store, launched in the year 2009,
founded by R Venkatesan. It is the perfect environment for purchasing fruits, vegetables. Its
procurement begins at farms and we adhere to stringent policies that enable us to maintain the
freshness of all our products.

Veggibazaar.com takes orders online and delivers the very next day. This not only ensures
freshness of the products—an essential feature of the company—but also means that he does
not have to worry about bulk storage space and associated facilities, which is a huge saving.

Vegetables reach the company's Alwarpet office in Chennai by 6.30 a.m. the following day
and, after a quality check, they are sorted, cleaned, chopped, packed and delivered between 3
p.m. and 9 p.m. Venkatesan has 25 employees to do these jobs. Clients can pay online through
debit/credit cards or pay cash on delivery.

Venkatesan has also started providing additional facilities, such as nutritional specific packages
and loyalty points which customers can redeem against future purchases.
GROCERY MARKET-

A million wholesalers and distributors,1 and a multitiered structure, the Indian retail
ecosystem is one of the most complex in the world. Over the past ten years, gradual shifts—
such as the onslaught of modern trade, the entry of cash and carry, the advent of the e-
commerce revolution, and, more recently, the growth in new-age B2B providers—have
begun to transform this ecosystem.
To add to it, the Indian consumer has been evolving dynamically in their quest for
convenience, health, and value. The pandemic that forced everyone to stay home further
accelerated many of these trends. The year 2020 was defined by sinusoidal changes and
uncertainties for the Indian consumer, and consequently for grocery retailers as well.

The grocery landscape has a transformation under way, with three factors guiding this shift.

● Digital adoption: Approximately 500 million Indians are connected on the internet, and
more than 100 million transact on it and India has seen one of the fastest accelerations
in digital adoption anywhere in the world

● “Innovation for India”: A connected India has led to the birth of start-ups, which have
built or adapted their operating models to the local context.

● Emergence of ecosystems: Direct-to-consumer ecosystems have become a market-

shifting force (exhibit).
Literature Review

Over the years, technology has taken a vast turn. As a boon, almost everything has been made
available to people online. Online Grocery being one of them. For people to adapt to a change
it takes a while. It was found that price consciousness, convenience, variety and easy
payment options were a few factors that impacted the consumers to shop online. However,
most of the consumers were worried about the security oftheir payment details. (Gurleen,
2012)

Online grocery services have been trying to take a hold in the market however due to the lack
of availability in some areas and due to the traditional habits of the consumers, a large
audience has not been able to gain the benefits of it. It was observed that people use OGS due
to the perceived ease of use. Nevertheless, onlinegrocery shopping is still a new concept and
therefore people cannot relate to it or they do not have a clear understanding of the risks
involved in it. (Sherah Kurnia, Ai-Wen Jenny Chien, 2003)

As online grocery services have not been able to cater to the rural areas and towns, the
awareness about the same is also limited in such areas. There is a huge section of the
audience who is unaware about such services. Significant differences were found in various
demographic traits regarding the awareness of the OGS. Factors that influenced the decision
of the consumers greatly were found to be perceived risk, perceived cost, perceived
convenience and perceived enjoyment. (Ajit Kaushal, 2015)

Tatiana Marceda Bach identifies the influence of three latent constructs that might affect
online purchase behaviors and also identifies risks associated with the latent and its effects on
consumers buying behavior.The need to reassess the strategies adopted by companies that sell
online to reduce risks and consequently increase trust in decision making were highlighted.
(Veiga, 2020)
"E-commerce: A boon for the current economic downturn"

First Data Corporation and ICICI Merchant Services, has laid down some facts that the
ecommerce market in India had clocked close to Rs 50,000 cores by the end of 2011.
(Jonathan Taylor 2001)

Even though there are less than 10 million internet users who are actually engaging in e-
commerce activities, there are about 150 million internet users in India or around 75 million
households that are ready for e-commerce.

With entry and operational costs being comparatively low than the other countries like US,
the second half of 2011 and the beginning of the current calendar have seen the launch of a
good number of new e-commerce sites spanning across a variety of businesses - women's
fashion, men's fashion, shoes, followed by accessories, groceries, sports, toys, home
furnishings, jewelry, automotive, bicycles, electronics and electrical equipment etc.(Eva
Antilla 2003)

Key drivers for success for e-commerce

Reduction in operational cost as the entire business can be moved online, the need for
physical stores has become obsolete. Less infrastructural investment and associated labor
costs drives up the profit margin.(Jason Thomas 2002)

It is far easier and quicker to compare prices of goods online, equipping the customer with
the information to decide the right price or terms for themselves. With services like COD,
customers can trust the process of going online and purchasing.
Market penetration also becomes far more achievable with e-commerce; it is possible for a
merchant in Mumbai to extend his reach to north-eastern cities or even rural villages that are
now connected by the online network.(Marie Alan 1999)

E-commerce facilitates shopping anytime, anywhere and for almost anything desired. Busy
consumers prefer this to the restrictions of when a mall/shop is open and the need to
physically travel to a shop. Online business takes shopping a step further by taking itself to
the customer creating conveniences of shopping anywhere and at any time.

In India, with the increasing propensity of social media, businesses have now begun to
engage their customers on social networking portals such as Facebook. These are likely to be
rapidly developing marketing channels for the future.

"These businesses are difficult to turn into profitable ventures due to the low margins
and the logistics costs involved."

Gaurav Saraf, director of Epiphany Ventures says that, the concept of online grocery
shopping faces the problem of turning their business into profitable ventures as the concept is
new in the market which leads to low margin along with low margin high cost is involved
when it comes
to logistics. In addition to these problems the perishable items such as fruits & vegetables
have a short shelf life, if these items are not delivered before the expiry of their shelf life it
could cause wastage and also add up the cost. From the above comment a conclusion is
arrived that these business ventures have a very thin margin when it comes to business
operations.

"Connecting the local kirana stores with the buyers while storing inventories on the
Cloud"

Vijay Singh, CEO & MD of Aaramshop.com says that in order to reduce the cost to their
business operation they applied the concept of cloud computing, where it connects the local
kirana shops with the buyers. It enables the business to reduce the inventory cost as all the
inventories are handled by the local vendor.

“Create a work-life balance"

Vijay Singh, CEO & MD of Aaramshop.com states that the concept of online grocery
shopping creates the work-life balance in urban areas where the urban couples are busy in
their work culture and cannot give time towards their daily life needs.

"It is a difficult venture and these challenges make investors more cautious while
evaluating such initiatives."

Singhal of SAIF Partners, explains that it is difficult for the investor to invest in these types
of business where the market is extremely fragmented.

Such a venture can only survive on repeat purchases and that's what one needs to target. If a
company knows what it needs to stock, how much it needs to stock and where it needs to
deliver, the business will become simpler to manage and run. The firm needs to find a strong
value proposition and target market to survive the cut-throat competition

The solution to the above problem stated can be that in order to survive in the market the
business should target the satisfied consumer to create repeat purchases. Also inventory
management should be applied to these organizations. It will enable them to know what it
needs to stock, how much it needs to stock and where it needs to deliver, this will allow it to
operate its business operation smoothly.
Research Objectives:
 To study attitude of customers towards buying groceries online

 To find out the preferences of the consumer regarding the attributes of online
shopping websites.

 To identify the issues faced by the user while online shopping.

Scope of the research:

 To determine which factor influences the consumer to go for online shopping

 To find out which feature of the website attracts the user to purchase the groceries
online.

 To find out whether grocery online shopping is beneficial for the user.

 To analyze which factors influence the user to buy online groceries.

Limitations:

The first limitation caused during the market research was to find out the respondent who shop
online and are web savvy.

The second limitation caused during the research was searching the women respondents who
shop grocery products along with the experience of online shopping

Another limitation caused in the market research was that the research will only study the
consumer perception towards online grocery shopping and not the dealers, wholesalers or
retailers' perception towards online shopping which acts as an agent to the online retail
industry to support its business operations.

Research Design and Methodology:

The sources of data used in this project report are both primary and secondary data.
Primary data

Primary data consists of original information gathered from a sample size of 102 respondents
residing in India.

Secondary data

Secondary data consists of information that already exists and that was collected in the past for
some other purposes.

Sources of secondary data are as follows-

Economic times
Mckinsey.com
Think global health

Sample Design:
Size of Sample: The sample size selected for the research is 102 in the area of India

Parameters of Interests:

The major parameter of interest is the subgroup of people who are working professional and
web savvy having an experience in online shopping. The two other subsidiary parameters of
interest are:

The respondent should also have experience grocery shopping. o And the female respondent
who has an online shopping experience.

Sampling Technique:

TARGET AUDIENCE:-

A target audience is a group of people identified as being likely customers of a business.

Over here the target audience are taken while working, having an experience in online
shopping and are ready to adopt changes. Also women respondents are taken as they are the
user who shop for grocery items than the male.

Data Collection Tool Used:

Questionnaire
The data collection tool used for the research is “Questionnaires" to get the primary data for
the empirical research on consumer preference on online grocery shopping.
The Questionnaire which is attached in the next page consists of a number of questions
printed in a definite order on a form which the respondents read.
Data Interpretation
Out of the 102 respondent, 101 respondents have filled the age questionnaire and out of the
101 respondent mostly are in the age category of 18-24.

Out of the 102 respondent, 100 respondents have filled the gender questionnaire and out of
the 100 respondent mostly are in the male category and the category of women is 40 percent
Out of 102 respondents ,100 respondents have filled the question of occupation, mostly of
them are student, It determines that the students shop more online groceries than the
professional and business persons
Out of 102 respondents ,101 respondents have filled the questionnaire and out of the following-

 About 80 percent people have said yes that they have online facility that means there is
accessibility of online items and online delivery system

 Only 20 percent of people have replied in negative that means there is none availability
of online delivery system.
Out of the 102 respondent ,100 respondent have responded the questionnaire and out of them-

 51 percent said that they buy groceries online

 34 percent said that they buy groceries from supermarket
 15 percent said that they buy groceries from local kirana shops.

Out of the 102 respondent 95 respondent have responded the questionnaire and out of them-

 37 percent of people purchase groceries online due to convenience features.

 21 percent of people purchased groceries online due to saving their time.
 18 percent people purchase groceries from online due to cost and variety
 24 percent of people purchase groceries from online due to safety.
Out of the 102 respondent only 82 respondent have responded this-

 29 percent uses fresh n daily

 20 percent uses aaramshop.com

 14.6perecent uses zopnow

 11percent uses farm2kitchen

 9perecent uses veggi bazaar

 Rest are the users of others applications

Out of 102 respondents only 91 respondents have responded and out of them-

 60perecent people uses weekly

 39percent people uses monthly

Out of 102 respondents only 94 respondents have responded and out of them-

 37 percent are attracted for online groceries due to home delivery

 43 percent are attracted for online groceries due to variety
 19 percent are attracted for online groceries due to discounts and offers

Out of 102 respondents only 93 respondents have responded and out of them

 28 percent feels that online groceries shopping is as replacement

 43 percent feels that online groceries shopping is as alternative

 29 percent feels that online groceries shopping is as additional option

Out of 102 respondents only 93 respondents have responded and out of them
 74 percent of respondents are satisfied and happy from buying online groceries.

 25 percent of respondents are not satisfied.

Out of 102 respondents only 94 respondents have responded and out of them
 20 percent respondent are facing the issues of no guarantee
 36 percent respondent are facing the issues of price
 20 percent respondent are facing the issues of security
 23 percent respondent are facing the issues of physical examination
Conclusion:

- From the above data analysis it can be conclude that consumer buys goods from the online
shopping website on the basis of factors like offers and discounts, variety of product
available, free home delivery, website user friendliness and cash of delivery payment option.

- From the above data analysis it can be determined that most of the respondent would agree
to buy grocery online rather than shopping of grocery with the traditional method.

- Out of the agreed respondent to buy online grocery, most of the respondent would think that
it would be beneficial to shop grocery online on the basis of factors like easy to order,
variety, discounts/ offers, saves time and avoid long queues and safety.

-The recommended business operation will not only beneficial for the consumer but also to
the firm, as it allows the firm to maintain its low operating expenses and for the consumer.

-The future of India’s online grocery sector looks promising even given it drawbacks that are
being continuously overcome by current participants, which is an opportunity to make
significant profits.

-As many respondents are facing issues in the physical examination and guarantee of the
product thus this is necessary for buildings consumer loyalty as they must trust the website
they are purchasing from.
FINDINGS-

 Mainly respondents are male in terms of online grocery shopping and we can clearly see that in the
age group of 18-24 there are mainly students who buy groceries online.

 From the data collected we can clearly see that there is an increase in number because of the
availability of online groceries service in most of the areas.

 Physical examination and price are the most common issues faced by the respondents.

 Mainly respondents are agreed by the home delivery and variety of products for buying groceries
online.

 Out of the respondent 42 percent people are seeing it as an alternative while the rest are seeing it as
replacement and additional value.

 Out of the respondents, mostly respondents are happy and they ordered the online groceries in weekly
mode.

 From the above data collection we can determine most of the respondents agree to buy grocery online
if the option is given.

 The data also determines the factors which will be beneficial for the consumer to shop grocery online
which are a variety at one shop, saves time and avoid long queues

 No guarantee of the quality of the product and the lack of physical examination are two things that the
customers see as a hindrance in the online grocery shopping platforms.

 Though online grocery services are available in most of the cities, it lacks approach in the rural areas.
This means that there is still a large audience that is not being targeted by the industry. People have
started to adapt to the new way of buying groceries. However, a larger chunk still believes in the
traditional methods of buying groceries.

 Though online grocery services are available in most of the cities, it lacks approach in the rural areas.
This means that there is still a large audience that is not being targeted by the industry. People have
started to adapt to the new way of buying groceries. However, a larger chunk still believes in the
traditional methods of buying groceries.

 India’s online grocery sector looks promising even given its drawbacks that are being continuously
overcome by current participants, which is an opportunity to make significant profits.

 With over 400 million mobile users, the growth rate will be exponential. The ability of the mobile
phone to provide access anywhere and anytime will change the way people shop in the future.
Recommendations:

Business Operational

When it comes to operational aspects of the business, the firm should consider the following
business operation model:

 Instead of going the regular eCommerce way of Grocery shopping, the firm should
start up by bringing existing retailers online.

 For the purchase of the grocery item user can choose their nearby Kirana Store from
the listed stores along with a convenient time of the delivery.

 The local store would be informed about the order and it would be delivered to the
address at the time mentioned with the payment of cash only on delivery.

Following are the important aspects of the proposed business plan:

 The firm will have a low operating cost compared to other online grocery websites, as
they don't have to stock any inventory of grocery products.

 The firm's main cost will include the cost of dealerships from the local retailers.

 Other costs will include the cost related to website designing, HR personal, computer
database hardware & software, building cost etc.

 It will allow the firm to eliminate the cost of brand loyalty of the branded grocery item
which reduces the operating cost to a great extent.

-It will develop a better relationship between their neighborhood retailer and the
consumers.

-It will allow more user interference, when the consumer can order their groceries from the
trusted local retailer, than an unknown player in the market.
Also it will protect the local retailer from diminishing from the market due the presence of
supermarkets and foreign players in the market.

-In order to increase the productivity of the site, the firm should offer special discounts with
respect to seasons like Diwali, Ganapati, Holi etc., also special packages should be created as
monthly ration.
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ml

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Economy-Moves-Online.html?storyInSinglePage=true
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