The significance of key constructs on consumer purchase intention in online retail in a Covid-19 climate

Abstract

The Covid-19 pandemic has added to the complexity of an already changing world due to its unexpected, rapid, and fatal impact. Countries, industries, businesses, societies, and individuals were not able to predict or plan for such an event. However, an unintended consequence of the pandemic is its impact on online retail, both electronic and mobile commerce. In South African, the online retail market is in its infancy, with a significantly lower online retail to total retail share than global markets. Therefore, there is an opportunity for businesses to capitalise in the current environment to increase activity and transactions in online retail. This study aims to conduct a quantitative analysis to identify the significance of key constructs associated with online retail consumer purchase intention (PI) in South Africa (SA) in a Covid-19 environment. The extended Technology Acceptance Model (TAM) and the Unified Theory of Acceptance and Use of Technology-2 (UTAUT2) model were used as a basis of the study. The key constructs in these models are risk, trust, Perceived Usefulness (PU), Perceived Ease of Use (PEOU), price value (PV),and Facilitating Conditions (FC). The models were adapted further by including Covid-19, a situational factor, as a key construct in determining consumer PI in online retail. The moderation impact of Covid-19 on risk, trust, PU, PEOU, PV, and FC on consumer online PI was also tested in this research. The research employed a quantitative statistical modelling technique. An online survey using the Qualtrics platform was conducted with a sample size of 368 adult participants with online shopping experience based in SA. The main structural equation model was tested using maximum likelihood covariance-based modelling. This study shows that the most significant constructs in determining consumers’ online retail PI in the current environment in SA are Covid-19 and PEOU. In addition, online shopping experience was an additional factor with a significant impact. This factor was initially included as a control variable and ultimately in the final model. The moderation impact of Covid-19 was significant on risk, trust, PU, PEOU, and PV. The implications of this study provide many opportunities for businesses to focus on to become agile and innovative to drive their online sales. The key constructs that businesses can focus on in the short term are exploiting the opportunities presented by Covid-19, placing emphasis on consumers PEOU, and encouraging consumers to gain online retail experience. This needs to be done without overlooking the hygiene factors of trust, risk, PU,PV, and FC, which still need to be in place. The results of following such an approach will provide new sales, repeat purchases, and growth of the customer base. The role of SA’s Government is just as critical as that of businesses in driving online retail. If anything Government can be the catalyst that can ignite businesses to become innovative and drive the online retail sector. This can be done by improving the FC of online retail through infrastructure, regulation and promotion of e-services, thereby providing digital access to consumers and increasing their online experience. The concerted effort by both the private and public sector will result in lasting social and economic benefits for business, consumers and the country