Personal cultulral orientations on the intention of online purchase books empirical evidence from vietnam

UNIVERSITY OF ECONOMICS HO CHI MINH CITYInternational School of Business ---HUYNH NHAT TRUONG PERSONAL CULTULRAL ORIENTATIONS ON THE INTENTION OF ONLINE PURCHASE BOOKS: EMPIRICAL EVI

UNIVERSITY OF ECONOMICS HO CHI MINH CITY

International School of Business

-HUYNH NHAT TRUONG

PERSONAL CULTULRAL ORIENTATIONS ON THE INTENTION OF ONLINE PURCHASE

BOOKS: EMPIRICAL EVIDENCE FROM

VIETNAM

MASTER OF BUSINESS ADMINISTRATION

Ho Chi Minh City – Year 2019

UNIVERSITY OF ECONOMICS HO CHI MINH CITY

International School of Business

-HUYNH NHAT TRUONG

PERSONAL CULTULRAL ORIENTATIONS ON THE INTENTION OF ONLINE PURCHASE

BOOKS: EMPIRICAL EVIDENCE FROM

VIETNAM

MASTER OF BUSINESS ADMINISTRATION

SUPERVISOR: Prof Pham Ngoc Thuy

Ho Chi Minh City – Year 2019

Introduction

The e-commerce becomes one of the most popoular shoping method in the world

in the recents year (Wu &Liu, 2011) It was showed in the the results of rate of

e-commerce consumstion and the revenue from the online retailer is increasing (Ozen & Engizek, 2014) However, the rate of Vietnamese comsumers involves in the e-commerce

is lower than some contries in the areas and in the world Vietnam had the rank 15 in comparison with 198 countries about the internet user in 2014 According to Do (2013) Vietnam had the most online user in SEA (Southeast Asia) From 2010, Vietnam is

considered as the country with the emerging global economy with the potential doing the online business However, the factors that affect the online consumer behaviors are very different among countries The Vietnamese people value the local context and unique characteristics of Vietnam culture, however the online shop retailers just copied all the concept from the Western in the online business

The potention of shopping online increasingly base on the increase in the use internet nowadays The consumers using the online shopping base on the information search easily and for the entertainment The sensitivity of the consumer toward the

culture assists in personalization of content, which leads to the increase in loyalty of the customers and sales volume (Singh, 2006; Tixier, 2005) Because of the intensify of the competion in the online shopping, it is considered a key factor for online retailers to determine the antecedents of online shopping acceptance from consumers

The previous researchs about online shopping determined the factors which affect the online shopping and the motivationm, value and prehistoric factors of the intention of online shopping behavior There has been some different affected factor for the purchase intention base on the Theory of Planned Behavior (TPB) Which is developed by Ajen (1991) base on the Theory of Reasoned Action-TRA (Fishbein & Ajen, 1975) The

behavior awareness reflects the difficulty when making decision, it depends on the

resources and chances to make the decision (Ajen, 1991) In the literature reviews, there has been a lot research conducted about how the cultural orientation affect the online shopping In the purpose of comprehending the values of cultural, many researchers used many kind of the cultural frameworks, namely Hofstede (1980), Hall (1977, 1984) or Schwartz (1999) for the online shopping behavior Junyean, Doren & Surinder (2008) has develop the frameworks for the further development in the model of Hofstede’s (1980), the frameworks of the affect of culture, type of product and price influces on the purchase intenion of consumers to the buy personalised product online In the culture dimensions, the authurs define the dimensions of cultural as “individualism, uncertainty avoindance, power distance, and masculinity.” In 2010, Sharma developed the Hosfstede’s model the uncertainty avoidance factor by two different separate dimension as “risk aversion” and

“ambiguity intolerance.” Sharma (2010) argues the many mixed findings of previous studies about the different individually in the degree of the “perceived risk” and the

“ambiguity” about a given context or product information The research of Sharma

(2010), fulfill the importants gap of in context of cross cultural context about Hofstede’s

by extending the multi-dimensional conceptualization of nation-level culture as the

twelve “personal cultural orientations (PCO)” at individual level In the same research of Sharma (2010), the author also developed his scale model on the behavior intention as the given product of imported cars And athur also asked for more implications in different area base on his research This thesis is the empirical on another products such as book and in the market of Vietnam is a different market in comparison with the the sample of Chinese market in Sharma (2010) research The book is the lower value product with the imported car and with different market that will have another results

Vietnam is considered as the very potential for the activities of e-commerce with the high population The aim of this study is finding how the PCO factors affects the intention of purchase books online in Vietnam With such that knowledge about essential

to customer relationship management, this will lead to an effective way for manager to use as business strategy to get more successfully achieve in the online book market

Literature review Culture and Intention to purchase

The online purchases behavour is a broad area for research, however, only fews research have been conducted about the cultural influences on the online purchases sphere (Moon, 2008; Park, 2003; Lopez, 2005; Chai, 2004) The online purchase

intention related to degree mesurement of the customer’s intente to make a behaviour of particular purchasing through the internet (Salisbury, Pearson, Pearson and Miller, 2001) Online purchase intention is defined as the customers’s desire to reach the final purchase

on the online shop retailer (El-Ansary and Roushdy, 2013) The purpose of this study is

to explore the personal cultural orientation on the online shopping in the context of

Vietnamese market In this thesis, four items adopted form Zarrad and Debabi (2012) to measure online purchase intention Spears and Singh (2004) cited that purchase intentions are the effort to purchase the specific brand by the individual’s conscious plan Online shopping is something like a system that customers can view then make a purchase of the goods or services through over the Internet (Milong, 2010) Online shopping can produce the convenience for customers to purchase good or services, save time and effort which can meet the customers demand of comfortable in purchasing (Wenjie, 2010)

According to Hofstede (1991), the culture is defined as “assemble mind

programming which can determine the group members or category” The key culture values are something that we studied from the childhood (Hofstede, 1980) and then

Ajiferuke and Boddewyn (1970) developed that from this generation to another

generation Culture is the gathering of a purpose share of members from groups society, the traditon, the customs, the norms Culture implies the knowledge share and implies the assumption of the values, the beliefs and other needed construct to clarify and cruise various spheres (Hong, 2000)

According to Allen (2002), culture is the beliefs complexity on societies, their roles, the behaviour, the values, the traditions, and the customs of people Culture is an conspicuously crucial concept to comprehend the behaviour of consumers toward a given products or services The knowledge of cultural constructs the basic for an social

reality of the individual; and the introduction that describe this reality are passed on during their child memory and are built up by intercommunicate with the others (Lau, 2001) From the culture effect on intention of consumer has dramatically increased and broadened, the globalization of the market spurred and diversificated the of consumer segments (Douglas and Craig, 1997) The differences in consumer behaviours across the cultural orientation are quitely big (DeMooij, 2003) that will lead to needs of the

empirical research of each country to understand the affect of cultural over the intention

of consumer behaviors

According to Levitt's (1983), globalization has created a increasingly more

common in the market of the world, with a developing number of customers from broad geographic destination and backgrounds of cultural have the similar preferences

According to Zou and Cavusgil (1996), there are some point of view that people from around the world who live in a more patten of uniform has expedited into the relatively emerged global brands with customised strategies of marketing across cultural barriers However, many researchers declared some evidences of increased alteration, especially among developed countries (Usunier, 1997) Suh and Kwon (2002) informed that

customers come from the different cultures background have different approachs of consideration to buy imported products even after much acknowledgement to the

globalization

The four cultural dimensions are pointed out in Hofstede's (1980) seminal work as dimensions for the explantion of cross-cultural differences in consumer buying

intentions Hofstede’s (1980, 1991) describes five dimension of the cultural, namely

“uncertainty avoidance, masculinity, and long-term orientation individualism, power distance” (Bearden et al 2006a; Soares, 2007) Individualism implies a loosely stick framework of social in which imply the “I”, which will prefer the personal decision over the group decision In contrast, collectivism implies a constricted social framework that implies the “We ” which consider the group decisions seriously People from highly societies of the individualistic appraisal a personal life, personal decisions, autonomy, and variety In the other hand, people in highly societies of collectivist emphasises the decisions, order, and security of the group For instance, In society of Chinese people they have historically focused on the group harmony and conformity in predisposing all inter-personal relations, in the meanwhile decreasing the goals of any personal

(Neelankavil, 2000) On the other hand, in the culture that show the strong individualistic such as North America and Europe, consumers are expected to emphasise their own individuality decision or the thinking of people are more strongly than those in the

collectivist societies

Accordingly, we presume that consumers reaction differentially to personalized given products across cultures with differences(Hofstede, 1980), and the differences among the culture dimensions may affect consumer responses to personalized online products between the two different countries

Personal Cultural Orientations

The differences of cultural around the world from almost research in behaviour of consumer engage the PCO for consumers’s individuals depended on the national scales of Hofstede’s (1980, 1991) Hofstede’s (2001) culture typology offers a approriate

theoretical backgroup to explore differences of cultural around the world with the

differences in behavior of consumers It includes four cultural orientations value, namely masculinity-femininity, and uncertainty avoidance individualism-collectivism, power distance According to Bond (1988), a fifth cultural value was added, the orientation is devided into the long term bahaviour and short term behaviour Some studies have cited that cultural values of the national scores relate to the level of individual degree and were used to explain the differences of the differences of cultural around the world with the differences in behavior of consumers (Birgelen, 2002; Ladhari, 2011)

Sharma (2010) re-conceptualized Hofstede’s five value of the orientations cultural

as ten scale of PCO which have the degree of individual and developed a

multi-dimensional scale the personal cultural orientations measurement Base on Sharma

(2010), instead of viewing individualism-collectivism from Hofstede’s concept as two opposite single dimensionintroduced two separate dimensions for the PCO, namely

“independence (IND) and interdependence (INT)” by Markus and Kitayama’s (1991) Accordingly, the Hofsteded’s power distance dimension are implied by two different dimensions namely power (POW) and ocial inequality (IEQ) These PCO supplies a broadener cultural differences range at the level of individual, however, and this thesis

suggest that INT, IND, RIS and AMB, TRD, INN will be considered as the useful factor

in explaining the differences in the purchase books online intetion

Interdependence & Independence

The literature about tradion of Vietnamese culture focus on the enduring

influence of Confucian values and ideologies The Confucianism tend to make the

person to adapt to the groups decision as collectivity, control their desires and emotions, govern self-interest for the benefit of the members group, avoid conflict and keep the harmony (Kirkbridge and Tang, 1992) The interest of the group, family, or the whole society must be higher than the interests of any individuals interest Hofstede’s (1980) cited that the people in the individualistic societies prefer to the private life, individual decision, meanwhile in the societies of collective prefer to the group or harmony

decisions The consumer in the individualistic culture intent to use the personalized products, on the other hand, the consumers from collective culture intend to use the

standards products In the high context or collectivistic cultures, context, wel-fare of the group, and casual reasoning are more importatnt in decision making In other words, in the collectivistic cultures will be affected by the group in the decision making, for

example includes the decision for buying a give product In the contrast, personal success

is the hightest importance in individual culture (Hall, 1976)

Therefore, we propose:

H1 The interdependence is positively related to online purchase books intention

H2 The independence is positively related to online purchase books intention

affectiveness of the anxiety to the acceptance of individual and technology of information usage The anxiety itself have the direct negative affect on the behaviors intention (Chiu and Wang, 2008; Fillion, 2012) Anxiety negatively affects the consumers perceptions of the effort requirements and conduct on the technology usage In addition, behaviors intention mediates the effect of anxiety outcomes on the actual behaviors We propose:

H3: The risk aversion is negatively related to online purchase books intention

Ambiguity Intolerance

Computer anxiety is state of anxiety changing itself to the transitory fearful tendency, the uneasy and aggressive when using the functional mechanical aspects of computers Russell and Bradley (1997) stated that the computer anxiety includes the apprehension of completing the task related to the computer This type of task anxiety is contiguously related to the intention to online shopping As it requires the affect with the internet’s infrastructure communication such as personal computer or mobile devices, the specific task with running the system or the web browsers, transfer and transmission the money and some other multiple tasks to shop online which different from the traditional shopping Vijayasarathy (2004) added some factors such as the difficulties inaccess, the problem of navigational, inconvenient of checkout procedures, poorly designs of the interface and out of date information content will contribute to the anxiety of the

perceived ease of use of online shopping

H4 The ambiguity intolerance is negatively related to online purchase books intention

Tradition and Consumer Innovativeness

According to Bond (1988) long term and the short term orientation firstly called

“Confucian dynamism”, the orientation of long term is the develop the orientation toward something in the future such as “reward, perseverance and thrift” (Hofstede 2001; p 359) The orientation of short-term implies the “stability, saving face, respect for

tradition, and concentrate on the past or the present” (Donthu and Yoo, 1998) According

to Hofstede (2001), the Confucian ethics affect the long-term oriented with dilligent, restrench, compassion, morality and social awareness In contrast, long-term orientation emphasise the society with the confucian dynamism of the confucian as the future

planning for the future in the respect of tradition Practical behaviour, the future

orientation rather than the near perspective or history (Hofstede, 2001) The consumers with future orientaion will prefer the global brands which will lead to the long-term

relationship with these brands In the meanwhile, de Mooij and Hofstede (2002) cited that the short orientation consumers tend to choose the private brandd because of short and immediate demand or benefit with lower price Long-term oriented people are actively in thinking, accepting abrupt changes; coupled with Confucian ethics of dilligent

The a short term value is the respect for tradition and persistence as a long term value Therefore, some studies argued from that the values norm Confucian Dynamism definion as the future plann, tradition respect, orientation for benefit of future, and

constancy; and are defined as the values of lorn term (Bearden, 2006) They redefine long and short term value as the “cultural value of viewing time holistically, valuing both the

past and the future, rather than deeming actions important only for their effects in the here and now or the short term”

Finally, according van Everdingen and Waarts (2003) to the influences

innovativeness of customer complaint behavior from the scale can explain the intention

of online shopping Therefore, we propose:

H5: The tradition is negatively related to online purchase books intention

H6: The consumer innovative is positively related to online purchase books intention

Figure 1 The conceptual model Consumer

Innovativeness

Methodology Data Collection

The research method for this thesis is divided into two parts, quality research and the quantitative research The quality research was conducted to confirm the

dimensions, items the interpretation of the dimensions, items, and how the interviewee understand the dimensions The definition of cultural orientation is explained and

discussed with a group discussion of two participants for the semi-structured

questionnaire of an in-depth interview Among the semi-structures questionnaire, there are guiding notes, key words that lead the interviews to the main purpose of the needed information The participant was the professor in research method and business

management sphere to make sure the interviewees of the in-depth conversation

understanding the definition and the purpose of the research After the group discussion for the semi-structure questionnaires of the in-depth interview, all the simplified

definition and the list of items were introduced to multi-national experienced

sales/marketing in General Marketing and E-commerce to confirm the definitions

The expectation of this research is 200 valid questionnaires for the data

analysis They were distributed to random people who have variable age, gender in the Hochiminh city The questionaire is narrowed down by the response who has the

intention for purchase books A group of economics students were hired to interview and collect information for the research These students were trained by the researcher to

make sure they understand the question and the needed information for the research The questionnaire in the interview are at first conducted in English and then translate into

Vietnamese Likers scales (5) has been used to ranging from strongly agree (1) to

strongly disagree(5) The code for the items question is in the appendix 1

The structural equation modeling was used to test the hypotheses Using the Amos software with 6 factors and 28 items Testing the confirmation factor analyses to test the unidimensionality of the measurement scales Check items if they share a single underlying factor Check the EFA find the extracted with eigenvalue of 1

86

3

119

41.35 1.44 57.21

5-15 millions/month 15-40 millions/month

23

132

23

11.06 63.46 11.06

Over 40 millions/month 30 14.42

23-34 35-60

13

178

17

6.25 85.58 8.17 Education High-School

Colleages &Universities Post-graduate

96

96

17

46.15 46.15 8.17 Marriage Status Single

Marriage, no child Marrigage, have child/chilredn

165

40

3

79.33 19.23 1.44 Table 1 Sample collection with the percentage of demographic categories

According to Hill (1998), the suitable number of sample respondents for the behavior research is from 30 to 500 In this research, 250 questionnaires were distributes and 240 sample respondent were collected 9 respondent samples were removed because

of missing obove two questions 8 sample were removed because of the same answer in all questions and 15 sample were removed because response time below 4 minutes The average response time to alll the question is 10 minutes As the results, we have 208 valid samples

As the results shown in the table 1, the demographic percentage that represents the nature the books reader with percentage of each follow: The purpose of buying books

reading (41.35), give as gifts (1.44%), both reading & give as gifts (57.21%) Gender with Male (55.77%) & Female (44.23%) The income with 3-5 millions/month

(11.06%), 5-15 (63.46%), 15-40 (11.06%), Over 40 (14.42%) The age of 18-22 (6.25%), 23-34 (85.58%), 35-60 (8.17%) According to Taylor (2014), the age of 23-34 spend around eight-teen hours a day surfing from the internet They might have more chances

on the purchase book intention The education and the marriage status also represent the wide range of the respondent

Measurement method

All the items were tested for their reliability by runing the Cronbach’s alphas

in IBM SPSS software Item Int1 is deleted by the low correlation (.099) After remove item int1, the results of Cronbach’s alpha value are in the acceptable range; from 713 to 885 This range of value is consider as acceptable when higher than 7 (Pallant, 2005) When all the measurement items were confirmed, exploratory factor analysis was

conducted to check the discriminant of the group of items The Principal Component Analysis and Varimax Rotation in SPSS were used The items ind4, risk4, risk5, amb5 were removed After remove two items, the Cronbach Alphas were tested again as the results with the range from 713 to 883 and the KMO is 841 and p=.000 < 0.001 that lead to the sufficient relations for a meaningful CFA The TVE of 7 component is

Corrected Item-Total Correlation

Cronbach's Alpha if Item Deleted

int1 9.62 6.814 099 713

int2 10.82 4.313 506 494

int3 11.22 3.977 529 471

int4 10.81 3.675 525 474

Table 2 The results of Cronbach’s Anpha test for the “interdependent” variable

Confimatory Factor Analysis

Figure1 The measurement model combining all variables

1 Root Means Square Error Approximation

(RMSEA)

.073 <.08 (Browne &

Cudeck, 1993)

2 Goodness of Fit Index (GFI) 820 >.90 (Joreskog &

Sorbom, 1984)

3 Comparative fit index (CFI) 898 >.9 (Benler, 1990)

4 Tucker-Lewis Index (TLI) 881 >.9 (Benler &

As the results shown in table 2, we can see the construct validity can not

achieve the Fitness Indexes for the require of the construct

The unidimensionality of the construct can achieved when the measuring items have the acceptable of factor loading >.6 (Nunnally, 1978) Item ind4, inn1, inn2 were respectively remove out of the construct

Table 3 The results of Average Variance Extracted (AVE) and Composite Reliability (CR)

As we can see in the table 3, the AVE of RIS is lower than 0.4 and RIS (.365) were removed from the structure The AVE of INT, IND, AMB, INN are below 5,

however, according to Fornell and Larcker (1981), if AVE is below 5 but greater than 4 and have the composite reliability greater than 6 will be considered as acceptable As the results, we keep the INT,IND,AMB,INN for process

After removing the RIS variable out of the construct (AVE < 4) Construct validity is achieved when the Fitness Indexes for a construct achieved the required level The fitness indexes and the level of requirement are as follow:

1 Mean Square of Error Approximation (RMSEA)=.071

2 Comparative Fit Index (CFI)= 904

3 Chi Square/Degrees of Freedom=2.054

4 Chi Square=622.388

We can come as conclusion that that measurement model had a good fit to the data After checking the confirmation factor analysis the model construct were test by Amos for analysis using SEM

Structural Equation Modeling (SEM)

With model fit and validity accepted with Confirmation Factor Analysis, the SEM were used to the test the hypotheses of the model

Figure 2 The results of SEM model after checking the confirmation factor analysis After running the SEM on AMOS, we have the results of:

1 Mean Square of Error Approximation (RMSEA)=.088

2 Comparative Fit Index (CFI)= 824

3 Goodness of Fit Index (GFI)=.839

4 Chi Square/Degrees of Freedom=2.848

The CFI <.9, CFI <.9; GFI <.9, RMSEA >.9 means that the model can not fit the incides

H1 INT→ INTENTION -.09 136 -.085 .506 Rejected

H2 IND→ INTENTION -.08 103 -3.305 .932 Rejected

Table 4 The Regression Weights for INTENTION from INT, IND variables

As we can see in the table 4, we have the results that two varible that were removed base on the p value >.05 (p = 506 (INT) & p= 932 (IND)) After that, we run the SEM again with the raimaining variable, as we can see the SEM results in figure 3

Figure 3 The results of SEM model after remove variable Int & Ind

1 Root Means Square Error Approximation

(RMSEA)

.068

Table 5 The results of SEM model with the reamaing variables

In figure 3, and table 5, we can see the construct get the Fitness Indexes The results in table 5 shown that the p value of all the regression weight values were

significant (p>.001) The standardized beta estimate from TRA affect on the

INTENTION is -.25 standardized beta estimate from AMB -.24 on the INTENTION and 31 on the INTENTION It preresents the contribution of the independent variable (TRA, AMB, INN) on the INTENTION is 25% (negatively), 24% (negatively) and 31%

(positively) It all supported the three hypotheses:

H4: The ambiguity intolerance is negatively related to online purchase books intention H5: The tradition is negatively related to online purchase books intention

H6: The consummer innovation is positively related to online purchase books intention

H4 TRA → INTENTION -.25 102 -3.755 000 Supported

H5 AMB→ INTENTION -.24 103 -3.305 000 Supported

H6 INN→ INTENTION 31 093 4.168 000 Supported

Table 5 The Regression Weights for INTENTION from IRA, AMB, INN variables

Findings & Discussion

This study is a research personal cultural orientation of purchase online book intention apart from the known model of TPA Base on the concept model of Sharma (2010), this study contributes to empirical evidence about personal scale orientation Base

on the prior hypotheses, the results of the study shown the empirical of Vietnamese

online books market Although, there are some limitation of the study, the results also shown the affection of cultural orientation on the online purchase books intention Three

hypotheseses are not supprted are Independence & Interdependence and Risk Aversion Can explain to that, the scale personal cultural oriention of Sharma (2010) base on the high-end of respondent that preresent culture of collectivism (Chinese) and Individualism (Westerns) and ignore all perspective from other countries And the example from

Sharma(2010) can not present all the market, especially Vietnam in the intention of

buying books online It might that Vietnamse can both have the “I” and the “We” as showed in the literature review About the results of the Risk Aversion, this findings added to the significant gap that Sharma (2010) developed from the Hofstede model in the “mix findings” due to individual differentces in the levels of perceived risk and ambiguity in the information for a given product We can see the diffenent that affect the customers behaviors base on the scale concept of Risk Aversion and Ambiguity

Intolerance The Risk Aversion in sharma (2010) model has the affect on the behaviors intention on the imported car However, in this research the risk aversion can not affect the purchase of buying a book online Because it might because of the low prices and

value of a book in comparision with the imported car

The findings of this reseach shown that there were affection of the personal cultural orientations on the online purchase book intention Negatively with the Tradition and Ambiguity, positively with the Consummer Innovativeness on the intention of

puchasing online books The results can show more about the open picture how the

cultural orienation can affect the online purchase book intentions to help them with the business decision for this potention market This can have the practical implication for

website designers or online marketing to customise their website with the elements

related to the tradion of Vietnam (the color, the images, website accessibility, etc) For instance, the colour of red is consider a sign of happiness for Chinese people but in the meanwhile, with culture of American the colour of red represents the associated with dange (Kang & Kovacevic, 2012) The image of one culture is different with the image in anothers culture (Charkraborty, 2019) If we just only adapt the content of the e-comerce

in the world might lead the fail in the adaption of Vietnamese culture The business of online book must have the more detail research about the tradition of Vietnamese people

It can also focus to develop the type of books with something related to tradition like literary novel