The introduction of e-commerce into the vast range of tools used for selling and purchasing products has changed how people perceive companies and choose products. The idea of shopping as a process that involves direct interactions with shop assistants and physical contact with a selected product has been redefined as the environment of e-commerce excludes face-to-face, tangible experiences (Lai 2017). Therefore, to improve the efficacy of marketing and promotion as well as increase customer loyalty, an organisation will require an in-depth analysis of the changes under discussion.
Determining the effects of e-commerce on customer behaviour is especially important for an organisation that offers medicated products (MP). In particular, potential customers seem more inclined to buy this category of goods online (Wang, Wang & Liu 2016). In addition, the availability of product recommendations to aid online shoppers is important in selecting needed MP. The tools and services that a firm chooses to provide can make the companies producing the goods on offer seem sympathetic and caring to their customers, in turn leading to a steep rise in customer loyalty to the brand (Kim & Peterson 2017). However, the changes in consumer behaviour that can be attributed to the introduction of e-commerce are more nuanced than merely a shift towards a less frequent use of retail outlets.
To explore the effects of e-commerce on customer behaviour in the MP industry, it is necessary to begin by defining the phenomenon of e-commerce. According to Hajli (2015), the broad definition of e-commerce includes a vast array of activities and interactions that involve promoting a product to buyers who go on to make purchases, as well as the subsequent delivery of the products to the customers’ homes (Huang et al. 2017). In the context of the MP industry, this definition can be stretched to include options for searching for new and better choices in the form of personal care items (Hajli 2015). The E-Commerce Success Model (ECSM) framework suggests that the quality of data management and the company’s infrastructure define the efficacy of e-commerce and the identification of tools for meeting customers’ needs. Thus, a steep rise in product quality and customer satisfaction levels can be expected in the case of a firm’s strict attention to matters of quality.
In addition, the problem should be approached from the perspective of the Commitment–Trust Theory (CTT), which sheds light on the relationship between a customer and a company producing a particular product, in this case MP. Such a perspective will allow for a deep understanding of how a bond between a customer and an organisation is formed. For this reason, a profound analysis of the opportunities and threats faced by a company offering MP to its buyers will be conducted.
Consumer Behaviour: Challenges and Determinants Worldwide
In considering the problems and opportunities that an organisation may have in general when transferring its business to the online setting, it is first necessary to consider the importance of using the Theory of Reasoned Action (TRA). Established in 1979 by H.C. Triandis, the framework implies that a buyer can be persuaded to purchase a certain product or service if conditioned to a specific choice accordingly (Fawzy & Salam 2015). In other words, by creating an environment in which buyers will opt for a particular mode of action, a company can successfully market its goods and services (Oni et al. 2017). Despite its relative age, Triandis’s theory is applicable to the contemporary global market. Indeed, because of the abundance of products and options available today, consumers may fail to notice a new and innovative product or service unless they are encouraged to buy it under particular circumstances. For example, promoting healthy habits and the importance of maintaining skin hydration allows a firm to successfully sell skincare products (e.g. creams, lotions and more).
The Theory of Planned Behaviour (TPB) also plays an important part in developing an understanding of the forces that shape customers’ attitudes towards a particular brand. Unlike the TRA, the TPB helps to connect the choices that customers make, not to external conditions but to buyers’ intrinsic characteristics: primarily, their beliefs, values and philosophies (Cheung & To 2017). Therefore, the application of the TPB helps in establishing a significantly better understanding of customers. However, this approach lacks analysis of the effects that external factors may have on customer behaviour in a particular market. Therefore, it is necessary to combine the TPB with the TRA approach to embrace the full array of the factors that determine people’s choices. The TBA was constructed by Icek Ajzen in 1985 (Kim et al. 2016).
The Expectation Confirmation Theory (ECT), created by Richard L. Oliver in the late 1970s (Oghuma et al. 2016), can also be seen as a major addition to the set of theoretical frameworks that help to explain the changes in consumer behaviours caused by e-commerce. This theory places an especially powerful emphasis on the level of satisfaction a buyer might experience after making a purchase.
The impact of innovation on people’s shopping habits is not to be underrated, either. Viewing the problem through the lens of the Innovative Diffusion Theory (IDT) yields the idea that selling a new product or service to buyers is a crucial determinant of behaviour change (Agag & El-Masry 2016). This phenomenon is especially evident when a disruptive innovation is introduced into a target market. Also considered non-incremental, a disruptive innovation changes customers’ perception of a certain problem by introducing a means of resolution standing apart from other products that address the issue (Agag & El-Masry 2016). Although Everett Rogers is typically mentioned as the founder of the theory, the concept of IDT was built in the 19th century by Gabriel Trade. Rogers primarily expanded and perfected the ideas proposed by Trade.
Finally, the Technology Acceptance Model (TAM) must be listed among the determinants of changes in customer behaviour in the global market. Linked directly to how people perceive disruptive technologies in the context of market relationships, this theoretical framework offers an important framework for exploring alterations in the behaviours of customers based on the characteristics of products, such as perceived usefulness and ease of use (Park et al. 2014). Created by Fred Davis and Richard Bagozzi, the model can be viewed as an extension of the TRA (Escobar-Rodríguez & Carvajal-Trujillo 2014). Among its benefits is the fact that it can take culture-specific factors into consideration when analysing changes in customers’ behaviours.
Consumer Behaviour: Global Challenges and Determinants for Medicated Products
Despite the plethora of theories attempting to explain changes in customer behaviour, in general, alterations that are observable in the context of the online environment and under the influence of the factors involved in e-commerce require specific study. This need is justified by the fact that the economic realm created with the help of e-commerce is significantly different from that established by the environment of real-life interactions. Because of the introduction of business-to-customer (B2C) relationships, the connection between buyers and companies is becoming much closer and more intimate (Fawzy & Salam 2015). As a result, organisations have been able to build trust in their relationships with buyers (Hajli 2015). The change under discussion is especially important in the context of the MP industry, where the choice of a product is connected directly to customers’ personal health-related and culture-specific needs.
As already established, a combination of environmental factors, personal needs and the perceived image of a product, including its usefulness and ease of use, serve as the primary determinants for shaping buyers’ behaviour in an online context in general. When applying these ideas to the setting of an MP industry, it is necessary to recognise certain deviations from the models described above. In particular, the impact of personal needs is often shifted into the background and substituted by the power of persuasion of modern media (Oliveira et al. 2017). In this scenario, influential factors include those associated with the perceived image of a product, which may be erroneous due to misleading information provided by media. As a result, the image of beauty and the concept of health management standards reinforced in modern media become essential determinants of buyers’ choices, along with personal needs and any perceived usefulness of MP-related goods.
In addition, among the crucial external factors that shape customers’ choices in an e-commerce setting, it is necessary to consider the importance of a strong and meaningful brand. Since competition levels are becoming increasingly high in the e-commerce environment, it is essential to construct a memorable and relatable brand image that target audiences will perceive as the representation of the organisation (Maity & Dass 2014). Thus, the choice of branding strategies and tools, as well as the final product – in other words, brand image and story – can be seen as paramount to the overall efficacy of an organisation operating in the MP realm. This determinant of buyers’ behaviours implies the challenges associated with creating a product that will be both useful and marketable to target audiences.
The propensity among companies to engage in a race to the bottom, which can be described in terms of the process of competing by setting the lowest possible price, also has a negative effect on overall success in establishing good company–customer relationships and improving the quality of MP products. In their attempt to set prices that will encourage buyers to purchase their products, MP companies affect consumers’ perception of their goods, reinforcing the belief that the products represent low quality. As a result, the foundation for building consumers’ trust erodes and prevents other firms in the MP realm from building a loyal consumer base.
Finally, e-commerce trends have affected customers’ perception of MP in general. Specifically, modern buyers will typically seek MP related to both health enhancement and beauty (Oliveira et al. 2017). This propensity implies that consumers will set high expectations for MP companies and are unlikely to buy care products that will fail in fulfilling either health- or beauty-related opportunities. Such a change in buyers’ behaviours promises difficult challenges for MP companies to overcome since it puts significant pressure on their research and development (R&D) capacities, forcing MP-related firms to produce new solutions to a relatively complex issue (Maity & Dass 2014) (see Table 1). Therefore, while the trends in customer behaviour cannot be seen as entirely positive, they also are creating a setting in which organisations feel inclined to evolve and improve the quality of their services and products.
Table 1. E-commerce and Consumer Behaviour: Challenges and Determinants.
Consumer Behaviour: Challenges and Determinants for Medicated Products in the UAE
In the UAE, the market for MP appears comparable to the overall conditions observed in the global MP market. It is possible to discern similar trends regarding the effects of media on buyers’ perception of beauty and care, as well as changes in customers’ habits due to the transfer to the online environment (Assawavichairoj & Taghian 2017). However, apart from the specified trends, state- and culture-specific tendencies are observable as well. For example, with the introduction of e-commerce tools in the MP industry in the UAE, buyers seem to have favoured international companies as opposed to UAE-based firms (Makki & Chang 2015). This change indicates that UAE organisations selling MP will have to focus on the quality of their products as well as pricing and communication issues (AlGhamdi, Alfarraj & Bahaddad 2014). Indeed, according to a recent study, the lack of physical interaction between customers and retailers in the online environment is leading to the need to enhance communication (Makki & Chang 2015).
The active use of smart devices can also be counted among essential changes for UAE-based customers in the process of shopping for MP. Residents of the UAE prefer to carry out their online shopping using not only personal computers but also mobile tools. In fact, the percentage of mobile users is taking up an increasingly larger share of the market compared to consumers using other tools (Kamaladevi & Vanithamani 2016). As a recent report indicates, around 80% of UAE citizens buy items online using their smartphones and similar mobile devices, and these purchases include MP products (Ghamdi, Alfarraj & Bahaddad 2014).
This tendency also affects how UAE residents view the process of making purchases. Instead of calling on the services of consultants and healthcare practitioners regarding the choice of appropriate care products, people are engaging in the process of self-medication (Hasan et al. 2016). The observed change can be considered a troubling tendency since the specified decision may result in failing to locate appropriate MP and even lead to making less healthy choices (Ghamdi, Alfarraj & Bahaddad 2014). Therefore, it is important for a company operating in the UAE MP industry to ensure that customers are not misled by false advertising and that consultations are available for buyers who are seeking specific MP. As a result, a significant rise in customer loyalty rates can be expected. Creating a customer-friendly setting will enable companies to successfully cater to buyers’ needs and provide them with the best possible customer experience.
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