The Impact of Country of Origin, Trust, and Satisfaction on Online Purchase Intention in Emerging Markets: An Indian Perspective

 

From Jindal Journal of BusinessResearch

India is an emerging market where the online retailing marketplace has been growing steadily since its inception in 2000. Due to increased internet penetration and the COVID-19 pandemic, the online retail market has grown faster in recent years. Online users in India have increased by 23%, with online shopping accounting for 40% of total online activities in 2019–2020 (Sharma, 2020). Additionally, the lockdown during the COVID-19 pandemic has had a significant impact on the retail market. During the curfew, consumers cannot shop in physical stores, providing an opportunity for e-tailers to acquire and retain customers. E-tailers, namely, Flipkart (31.96%), Amazon (31.2%), Myntra (4.7%), Paytm Mall (3.3%), Snapdeal (1.9%), and others (28%), dominate the Indian online retail space. Amongst the top five e-tailers—Flipkart, Myntra, Paytm Mall, Snapdeal, and BigBasket have headquarters in India, while Amazon India is a US-based Amazon Inc.’s subsidiary.

Though online retailing penetration has been growing over the years, prior research has shown that unethical practices by e-tailers have been detrimental to its growth. Previous studies have found that consumers are worried about various unethical practices, such as privacy, security, deception, fulfillment, and customer services, during online shopping. However, trust and satisfaction with online retailers have resulted in consumer purchase intention. This study investigates consumer online purchase intentions in emerging markets by focusing on the impact of country of origin (COO), trust, and satisfaction. Here, COO cues act as a trust builder, leading to the online purchase transaction and enhancing post-purchase satisfaction, further leading to increased consumer confidence.

There has been a growing interest in understanding consumer behavior toward online shopping in emerging markets. However, research on understanding the impact of COO on purchase intention is relatively underexplored. Analyzing the effect of COO in an emerging market context like India is essential, as it is the fifth largest global destination in the retail space (IBEF, 2021). The Indian online retail market is poised to grow from $ 60 billion in 2020 to $73 billion by 2022 (Statista, 2021). Opportunities in the online retailing sector have resulted in foreign players, like Amazon and eBay, entering the Indian market. However, there is no concrete information available on consumers’ marketplace behavior toward domestic and foreign retailer brands. Therefore, the present research was conducted to understand the impact of COO on consumer behavior in Indian online retailing.