Introduction
Impulsive purchases could be considered an unexpected acquisition of a particular product or service. This type of behavior carries significant importance in the contemporary world. Recent research suggests that this type of consumer behavior is attributable to 40-80 percent of total purchases made by clients. However, it should be noted that the number is also dependent on the product type. The research in impulsive behavior is attracting research within the context of business implementation and social and behavioral studies. This paper will partake in eliciting some of the core elements that have a positive relation to the impulsive buying behavior of customers within the context of live broadcasting e-commerce, which is gaining popularity in the Chinese market.
The progress in communication technology has transformed the current perception of social presence and buying behaviors. Currently, e-commerce is the leading type of retail transaction utilized globally due to various reasons such as convenience (simplified user interface, single click purchase), direct delivery programs, and low price. The overwhelming popularity of this retail type demonstrates the effectiveness of such purchases in attracting new customers and offering convenient methods for satisfying supply and demand. The marketing of products is no longer limited to conventional forms of advertising like mainstream print and electronic media.
Platforms for e-commerce make it easier to find product information, which facilitates comparisons and decision-making. To sway consumers’ purchase decisions, they try to mimic the experiences and interactions that customers have in stores. Therefore, in the internet-enabled market environment, interactive marketing is important. In this situation, consumer marketing methods entail increased interaction and the availability of information resources to foster learning and comprehend individual demands. Companies struggle to determine the most effective engagement and marketing methods that correspond with customer expectations and knowledge levels due to the fast rise in and sharing of information in online settings.
Therefore, traditional e-commerce is currently undergoing a transformation in the selling system. This development was caused by the growing popularity of live-stream commerce in the Eastern Market. In China, a number of vendors have begun to use live streaming to increase the effectiveness of their sales, which has led to the development of a new type of e-commerce known as live streaming commerce (Sun et al., 2019). China’s live streaming users reached 617 million at the end of December 2020, making up 62.4 percent of all Internet users in China, according to the Global Times (2021). There were 388 million live streaming business users among them, accounting for 39.2 percent of all Internet users (Global Times, 2021). The market for live streaming in China is predicted to be worth $305 billion in 2021, accounting for more than 15% of e-commerce sales there that year and more than 20% by 2022 (Hallanan, 2020).
Given how live streaming is changing consumer approach to shopping, there is still enormous potential for the expansion of this industry. In addition to seeing text messages and images, customers may now watch the real-time video and communicate with vendors in real-time. Nearly all of China’s main e-commerce platforms, including JD.com, Taobao.com, and Pingduoduo.com, have created live streaming commerce due to consumer interest in real-time engagement and rich content. A number of social media platforms have also embraced the new trend one by one.
The majority of researchers have linked impulsive buying with unplanned or accidental purchases. An unplanned purchase is crucial for determining if a purchase qualifies as impulsive. The same customer may experience an impulse purchase once or more. Impulse purchasers are less likely than regular, known shoppers to carefully consider their purchasing decisions and are not expected to feel that doing so would have any negative effects on their business (Sudha and Bharathi, 2018). They are more open to the idea of impulsive buying because they are more concerned with the immediate satisfaction of making a purchase. Impulsive purchasers are perpetually drawn to the issue that drives them to make a purchase. Additionally, Sudha and Bharathi (2018) pointed out that customers are impacted by both the inside and outside aspects of an impulsive purchase. As motivation is typically driven by impulsive action, the likelihood of impulsive purchase rises as a result of increasing exposure to certain external stimuli. These external variables explain both the impulsive purchasing patterns of consumers and the roles that businesses play in promoting impulsive behavior.
In this regard, this research considers that among external factors that may affect the behavior of the shoppers in the context of live streaming commerce, it is possible to elicit marketing strategies and social factors. Among live streaming marketing techniques, the most common approaches include time limit promotion and price promotion, while the social factors that mimic offline interaction popularized in this type of commerce are the social presence of broadcasters and viewers. These types of stimuli may create an inclination toward unexpected purchases along with extraversion as an inherent customer trait that contributes to impulsiveness. Consequently, the objectives of this research are to analyze the influence of these internal and external factors on impulsive buying behavior within the scope of the Chinese live streaming retail market.
Literature Review
Impulsive behaviour
Impulsive behavior has long been associated with immaturity, primitivism, and criminality (Freud 1911; Hilgard 1962). At the same time, many researchers have argued that impulsivity is a result of short-sightedness and a deficit in the personal will (Stigler and Becker 1977; Strotz 1956). Impulsiveness often has a derogatory connotation in consumer behavior, and impulsive consumption often has negative consequences. However, some researchers argue that impulsive spending is a common and normal behavior in some consumer scenarios and even has positive implications. For example, people suddenly decide to pay for a meal or take advantage of a sale in a shop to give a gift to a loved one. These acts often represent kindness and generosity, and impulsive consumption can show more positive effects when it is tied to moral standards (Rook and Fisher, 1995).
The terms impulse and impulsivity have been widely used within the fields of clinical psychology and developmental psychology (Rook and Fisher, 1995). Freud argues that impulsivity is a fundamental human characteristic, that impulse buying can tend to be conceptualized to varying degrees in different people, and that impulsivity as a consumer characteristic is a normal phenomenon (Freud 1911; Hilgard 1962). Impulsive buying behavior is when consumers make impulsive purchases outside of their original spending plans (Cangelosi & Dill, 1964; Liu & Li, 2008). According to (Parsad et al., 2019), impulse buying is a model in which the consumer perceives that the product or service creates a desired, persistent, and strong desire to buy.
Impulse shopping is, in fact, an irrational process, a spontaneous tendency of consumers to make purchases that are often unthinking and immediate. Many researchers tend to associate impulsiveness with immaturity. Consumers who tend to buy on impulse are willing to experience the pleasure of immediate gratification but are otherwise unreflective and overly self-centered in their pursuit of self-satisfaction. (Rook and Fisher, 1995). Most impulse consumers choose the outcome rather than the benefit. Most impulse consumers are driven solely by their senses or their minds and do not evaluate whether the purchase is justified (Stigler and Becker, 1977; Strotz, 1956). Context can have a huge impact on consumers’ decisions, and most impulse purchases are the result of unconstrained behavior. As there are no constraints, consumers can consume as they wish. However, for consumers who consider re-purchasing to be unacceptable, their manner is constrained by internal behavioral norms, which can act as a disincentive. (Eysenck and McGurk, 1980).
Most early researchers have focused their research on defining or redefining the concept of impulse buying (Badgaiyan & Verma, 2014). Weinberg and Gottwald (1982) state that impulse buying is a strong emotion generated by consumers in response to stimuli from the external environment and that this emotion leads to immediate purchase behavior during the shopping process. Rook (1987) argues that impulse buying is a situation in which consumer behavior is uncontrolled and in which consumers feel a sense of inner satisfaction. Some researchers have gradually shifted their focus on impulse buying in the middle of the study, moving from studying the objects of impulse buying to the reasons for impulse buying and, finally, how consumers make impulse purchases (Khawaja, 2018).
According to Nasreen et al. (2015), impulse buying factors can be summarized into two aspects, internal and external. Demographic factors are the most important factors influencing consumers’ impulse buying manner, followed by situational and personal factors. Li and Cui (2010) conducted a study on the contextual factors of consumer impulse buying and found that the contextual factors of consumer way of acting include material, temporal, marketing, environmental and psychological. These elements all contribute to consumers’ impulse buying behavior. Khawaja (2018) states that consumers’ impulse buying behavior is influenced by a variety of factors, including the environment in which they shop, their attributes and the characteristics of the product itself, and socio-cultural factors that influence impulse buying. In fact, impulse buying has become a widespread phenomenon and is becoming part of people’s lifestyles. Consumers are motivated to purchase goods when they are exposed to random, powerful, and persistent stimuli.
The researchers further suggest that the visualization of impulse shopping behavior can help researchers to predict the differences more clearly between actual impulse buying behavior and general impulsive purchases (Jones, Reynolds, Weun, & Beatty, 2003). Louis et al. (2016) showed that the quality of web design and promotions could also have an impact on consumers’ impulse buying behavior. Li et al. (2018a) found that the quality and quantity of product reviews can have an impact on consumers’ impulse buying. Many good product reviews can have a positive impact on consumers’ impulse buying. In addition to this gender, impulse buying can also have an impact, with research showing that female consumers are more likely to make impulse purchases. Due to women’s overwhelming consumer demand, some marketing efforts based on this will stimulate impulsive consumer behavior in the female consumer group. In addition to this, millennials are also a significant group of impulse consumers, with most of them having less self-control, which can also contribute to impulsive spending behavior (Yang & Lu, 2013).
A growing number of researchers have begun to explore the link between personality traits and impulse buying (Badgaiyan & Verma, 2014). Personality traits are physical and psychological states that influence a person’s state and response to society and are psychological traits and intraspecific mechanisms that are ordered and persistent. Most impulse purchases are a combination of situational and personal factors. Personal factors refer to a person’s own personality traits, while situational factors refer to the context of the shopping process, including changes in the consumer’s mind, marketing scenarios, product features, time of day, interaction, and others.
In the case of e-commerce, promotional activities and the quality of the website and product reputation constitute the factors that influence consumers’ impulse shopping. (Xiong, 2017). When contextual and personal factors combine to satisfy the consumer’s desire to consume, the consumer does not have sufficient self-control to produce impulsive consumption behavior. With the development of modern e-commerce, more and more e-commerce models can meet the needs of contextual factors. For example, live shopping can meet consumers’ demand for instantaneous and interactive shopping. Therefore, the impulse buying behavior of consumers is promoted (Rook and Fisher, 1995).
Personality Traits of Extraversion
Personality refers to “relatively enduring ways of thinking, feeling and behaving” (Costa, McCrae, and Kay, 1995, p. 124). Personality traits can be divided into five dimensions: Neuroticism, Extraversion, Openness to Experience, Agreeableness, and Conscientiousness (McCrae and Costa, 1989a). Initially, for the non-researcher lay-person personality could be defined in terms such as friendly, easily excited, and positive, which were the simplest way to summarise a person’s personality.
Many researchers have been exploring the field to standardize the definition of personality traits, and Auport and Odbert found that there are approximately 4,500 words used to describe personality. This large vocabulary illustrates the importance of personality traits, the fact that all individual differences can be expressed through vocabulary, and that personality traits can be coded. When one begins to decode specialized personality terms, the basic dimensions and factors of personality can be discovered (McCrae and John, 1992).
Different languages can also have an impact on the definition of personality traits. Although similar features were found when the personality rating scales were translated into Chinese, Japanese, or German, these findings were not entirely consistent. For example, the five personality factors in the Chinese language did not complete a one-to-one correspondence with the personality factors in English (Yang & Bond, 1990). Allport describes personality as a ‘real person’ and argues that it is a fundamental expression of a person’s inner activity. Personality is the combination of a person’s actions, thoughts, and feelings (Allport and Odbert, 1936). The classification of personality traits is changing. Allport (1938) divided personality traits into three categories: primary, central, and secondary traits.
Initially, there were over 60 adjectives used to describe personality, and eventually, personality traits were slowly narrowed down by research scholars (Thurstone, 1934, pp. 12-14). As research continued to develop and refine, many researchers (e.g., Goldberg, 1990; McCrae and Costa, 1992) classified personality traits into five categories: 1 extroversion; 2 agreeableness; 3 conscientiousness; 4 neuroticisms; and five openness. This categorization of personality traits has been used to date and has been the subject of most scholarly research. Borgatta (1964) and Smith (1967) identified five other personality factors likability, responsibility, emotionality, and intelligence.
In contrast, Eysenck (1991), who has been a proponent of primitive representations of personality, does not support the five-factor model, arguing that there are not five factors that describe human traits, specifically agreeableness and conscientiousness are only one branch of extroversion neuroticism and openness. Eysenck (1991) states that the main personality traits are extraversion, neuroticism, and psychopathy, and here openness traits are included in extraversion.
The Big Five traits are a summary of hundreds of personality traits, such as extroversion, which corresponds to a talkative, decisive, and extroverted personality trait openness, neuroticism, which is a sensitive, fragile, self-centered, and emotionally unstable personality trait; and agreeableness, which is more moderate and kinder. The conscientiousness trait is a combination of rigor and trustworthiness, and most of these people are calm, analytical, and emotionally stable (Goldberg, 1993).
Another way of classifying personality is to divide it into introverted and extroverted personalities, with introverted personalities being rational and calm, preferring to be alone and more focused on themselves. Extroverted personalities are more emotional, social, and willing to express themselves and are often adventurous and optimistic (Moeller et al., 2001). Generally, extroverted personalities have more positive emotions than introverted personalities in a marketing environment, and they are more likely to contribute to buying behavior (Mooradian and Olver, 1997).
Extraverted Personality Traits and Impulsive Buying Behavior
People with an extroverted personality have a positive attitude towards life, are eager to socialize, want to be noticed, and are more interested in experiences and new things. Because of their social skills, they are more likely to relate to salespeople and are more likely to build trust and be persuaded. They are also risk-takers, so they are not afraid to take risks, and compared to other personality traits, extroverted personality traits have less self-control and are more prone to impulsive behavior (Badgaiyan & Verma, 2014). Extroversion is also a communicative and sharing trait, and extroverts are happy to share information with others, which gives them a sense of inner satisfaction.
In the past decade or so, some scholars have persistently studied the link between personality traits and impulsive personality, and in order to effectively study the topic, research scholars have introduced self-control as a medium, which is the ability to consistently control inner desires and emotions (Schmeichel and Macrae, 2014). Many extroverted personalities show a negative correlation between extroversion and self-control. Experiments have shown that most extroverted personalities have weak self-control and are easily guided by their environment or others, and when their environment changes or they receive strong stimuli, they usually lose control and engage in impulsive spending behavior (Mao et al., 2018)
Responsibility is also an essential consideration in influencing impulsive spending, with some studies showing that there is less of a link between extraverted personalities and responsibility and that a lack of a responsible state of mind can lead to impulsive spending behaviors (Thompson and Prendergast, 2015).
Extroverted personalities tend to have an upbeat personality. Aspinwall (1998) shows that the positive attitude of extroverts makes them prone to hedonism and thus motivates impulsive spending behavior. Fedorikin and Patrick (2010) found that positive emotions reduce the functionality of self-monitoring and self-control, that elevated emotions can awaken inner appeals and desires, and that this emotional state of mind weakens consumers’ ability to reason. In summary, researchers generally agree that extroverted personality traits have a positive association with impulsive buying. The Extraversion traits have a significant positive influence on impulse buying behavior. Therefore, the first hypothesis is that:
H1: The extraversion traits have a positive influence on impulse buying.
Live Streaming
Live streaming produce and disseminate content in real-time, with various forms of distribution such as singing, dancing, and gaming videos mainly focused on games and entertainment (Lin, Yao, and Chen, 2021). With the continuous development of the market, live streaming is slowly merging with commerce and thus promoting the development of live e-commerce, which can be divided into two main types. The first is the live streaming function embedded within e-commerce websites. For example, Taobao (one of China’s e-commerce giants) will have a live streaming function embedded in its department. The second type of social networking is sites or social apps with e-commerce functions, such as China’s TikTok âKuaishou short video platform or Instagram and Facebook for the United Kingdom, United States, and European countries.
Chinese Live E-Commerce Market
E-commerce in China dates back to the 1990s, a later development date compared to some Western countries (Hu and Chaudhry, 2020). However, with the continuous development of China’s e-commerce market and the popularity of the Internet, China’s e-commerce market is showing a steady growth pattern. 46.3% of China’s online retail market will be reached by 2022, with a gradual growth trend shown in the chart below (Statista, 2022).
According to Figure 2, the size of China’s online shoppers shows an expansion trend from 2015 to 2020 to reach a market share of 780 million in 2020. The market growth rate also shows a steady growth trend from 2017 to 2019. Growth is slowing down from 2019 onwards due to COVID-19. However, the e-commerce market still holds a significant market share in China compared to other traditional business models.
The continuous development of e-commerce has also driven the development of China’s live e-commerce industry, which can show a growing trend to reach 24.3% in 2023, as shown in Figure 3. In fact, due to the huge market potential of live e-commerce and the revenue, it can generate, Chinese e-commerce platforms are increasingly developing live streaming businesses. For example, leading e-commerce companies such as Jindong and Alibaba already have mature e-commerce live streaming profit models and systems. Furthermore, an increasing amount of small and medium-sized e-commerce platforms are seeking to gain market share in the live streaming market.
Live Streaming Marketing
With the growing popularity of live e-commerce, impulse buying has become a common behavior when shopping online. Impulse buying is defined by many researchers in the field of e-commerce as “a form of unplanned purchase” where consumers make an on-the-spot decision after being stimulated (Iyer, Blut, Xiao, and Grewal, 2019). Impulse purchases can be divided into four types: pure impulse purchases, suggested impulse purchases, reminded impulse purchases, and planned impulse purchases. The impulse purchase types of consumers in live e-commerce are mostly related to the first three types (Zheng, Men, Yang, and Gong, 2019).
Compared to traditional e-commerce, live e-commerce is more likely to stimulate impulse buying behavior, driven by a variety of live marketing strategies (Lee and Chen, 2021). Firstly, the real-time and interactive nature of live marketing allows users to see the products more directly from different perspectives and to interact with them better (Xue, Liang, Xie, and Wang, 2020). For example, viewers can interact with other viewers through chat boxes. At the same time, e-commerce live streaming can also increase the interactivity with users through interactive strategies and activities to trigger consumers’ desire to buy, such as adding interactive games to the live stream to increase the fun of the broadcast. Secondly, promotional marketing strategies in live streaming can increase the sense of urgency and thus induce impulse buying behavior (Xue, Liang, Xie, and Wang, 2020). For example, in order to increase consumers’ desire to purchase, coupons can be issued, or limited-time coupons can be used to increase the sense of urgency and thus increase the impulse purchase rate.
The Impact of Social Presence on Impulse Spending
The interactive marketing strategy of live streaming is one of the most critical factors in increasing consumer impulse buying, and there are many ways to create interactivity. Social presence refers to “the role of interpersonal relationships as expressed through the salience of interaction” (Parker, Short, Williams, and Christie, 1978). Social presence plays a vital role in live e-commerce, which we analyze in detail here by combining it with the key medium of live broadcast, the anchor. The social presence of live streaming refers to the process of interaction between the consumer’s internal perception and the anchor. The most remarkable function of live streaming is that it enables direct communication and interaction between the broadcaster and the consumer across time and space (Johnson and Hong, 2020).
Despite the fact that non-verbal signals and social context cues are said to be rare in computer-mediated communication (CMC), the study by Gunawardena (1995) shows that it is possible to generate social presence. It is done by projecting identities and forging online communities. Although his study was conducted in relation to online conferences, the findings are applicable in the context of live streaming commerce. Therefore, According to Gunawardena (1995), it is crucial that streaming moderators foster the construction of suitable environments in order to promote engagement and collaboration to foster the needs of the streaming (commerce and promotion). Participants in CMC can learn how to establish a social presence and foster a feeling of community through text-based communication (Gunawardena, 1995). Moderators should begin the conference with introductions and social exchanges; if a conferencing system is being utilized, moderators should designate a distinct space for social chit-talk (Gunawardena, 1995). This way, it is possible to avoid overcrowding issues and provide a sustainable and entertaining streaming environment.
Enhancing interaction and communication in computer streaming will need to account for various factors. These factors may include the creation of protocols for CMC interaction, procedures for logging on and utilizing the system, discussion etiquette for CMCs, and methods for dealing with information overload (Gunawardena, 1995). In order to stimulate talks, conference moderators should acknowledge each participant’s input at the outset, summarize often, and connect various points. The responsibility for establishing codes or legends for the idiomatic and colloquial language they employ that might only be understood in one particular culture would fall on the individual participants when the computer conference is made up of a cross-cultural group (Gunawardena, 1995). Many participants will have the chance to engage in both intellectual and social engagement in a welcoming and safe CMC environment (Gunawardena, 1995).
Many designers of remote learning have been interested in creating CMC settings that support collaborative learning. Constructivism has just started to have an impact on how technologically mediated learning environments are created. According to constructivists, thinking is based on observation of physical and social events, which the mind alone is able to understand (Jonassen in Gunawardena, 1995). The mind creates mental representations that justify what the person has seen. Then, things in the actual world are explained, predicted, or inferred using these models. A large portion of reality, according to constructivists, is shared via social negotiation.
CMC settings may be created to offer many viewpoints and examples from the actual world, promote reflection and facilitate social negotiation for the joint building of knowledge by utilizing constructivist ideas (Gunawardena, 1995). However, only if participants can relate to one another, feel a sense of community, and have a common objective can such learning settings encourage collaborative learning, which entails the active production of knowledge through social bargaining. Promoting collaborative learning and knowledge creation requires the growth of social presence and a feeling of an online community.
However, if one were to transfer the theory of Gunawardena onto the subspace of live stream commerce, the majority of his findings could be addressed as recommendations for increasing interactivity and engagement. This way, it would be possible to expand upon the existing systems for e-commerce and design a model of live stream commerce that would allow to conduct business and promote the necessary product safely. Thus, it is essential to secure social presence via a common desire for the product and a sense of community by pressing on to the regional emphasis of the stream. At the same time, since reality is socially negotiable, the reality of the purchase experience online could be understood as one filled with real thrill and entertainment akin to an offline event. Therefore, it is possible that live streaming commerce is growing in popularity due to the large social presence and strong perception as a real experience of buying.
Live broadcasters can communicate and interact directly with consumers, and as live businesses are upgraded, more and more live broadcasts offer a wider variety of personalized services and features. Therefore, live e-commerce can show a more social immersion. Compared to traditional e-commerce, live e-commerce offers consumers more possibilities to increase the sense of social interaction through conversation (Lu, Fan, and Zhou, 2016). Live broadcasters play a vital role in interactive marketing strategies. As the products recommended and explained by the broadcasters are random and often not urgently needed by the consumers, they are guided by the broadcasters to generate impulse buying behavior.
In addition, some scholars have indicated that interpersonal interactions influence consumers’ impulse buying behavior to some extent (Shen & Zhao, 2018). According to Larose (2001), information sharing and feedback from purchasers about products also affect consumers’ purchasing decisions. Zhang and Wei (2019) found that interaction between users enhances impulse purchase thoughts and influences their decisions. In a live e-commerce scenario, users can share and exchange their buying experience with other buyers and viewers in a chat box. Such a real-time interaction helps consumers better understand the product and thus make an impulse purchase decision.
The social presence is an intangible but perceivable interaction within the field and with different actors. In the case of live e-commerce only two actors remain: broadcaster and viewers. The cooperation between consumers in the evaluation of the product, or broadcasters themselves allows to determine trust worthiness and either encourage or discourage purchases. Perhaps this research may underscore the importance of such interactions in the development of impulsive behavior.
In the Chinese live streaming market, many live streaming platforms have developed chat features such as emojis to increase the interaction between consumers in order to promote purchases. They have also created different types of anchors, such as celebrity anchors or social media influencer anchors, in order to attract the attention of consumers (Wu, 2021). Therefore, the following hypotheses are proposed:
H2: Interaction between anchor and consumer has a positive impact on consumer impulse purchase.
H3: Interaction between consumers has positive impact on consumer impulse purchases in Chinese market.
The Impact of Marketing Strategy On Impulse Spending
Promotions are one of the essential marketing tools for merchants and can help them generate sales in a short period (Mandolfo, Bettiga, Lamberti, and Noci, 2022). Wang et al. (2014) found that in live e-commerce, many merchants use promotions for better and faster profits. Typically, in live marketing, merchants use various forms of promotions to help drive sales, such as limited-time discounts and hefty discounts to promote consumer purchases.
Promotions with significant discounts are the most direct and quickest way to show results. The lower the price of the product, the less risky it is for the consumer to perceive, and in this case, the consumer will usually make an impulse purchase. Limited-time promotions are also a very effective way to motivate consumers. According to Liberman and Sagristano (2002), people’s reactions and attitudes to things depend on internal state representations. When the psychological distance between an individual’s perception and the target is considerable, people are more rational and willing to think and understand things from a core perspective. However, when the psychological distance between perception and target is small, people tend to think in an emotional state and in the external form of things (Liu et al., 2012).
Lu et al. (2013) revealed that in live e-commerce, when speed-limited promotions are used, it is likely to create time pressure on consumers, and the sense of time urgency can create the illusion that they are closer to the product. As a result, consumers tend to think in an emotional way. They tend to focus on superficial information and do not think objectively about the product and manage their needs rationally, all of which can contribute to impulsive shopping behavior. In addition to this, consumers may lose the opportunity to purchase goods at a lower price if they do not complete the transaction within the specified promotional period. Therefore, often consumers are willing to exaggerate their internal perceptions to maximize their benefits and forgo predicting risk and rational analysis (Cui, 2019). Based on the above, we formulate the following hypotheses:
H4: Price promotions have a positive impact on consumer impulse purchases in Chinese market.
H5: Limited-time promotions have a positive impact on consumer impulse purchases in Chinese market.
Methodology
The conceptual framework of this essay is as follows:
Research Design
This essay uses a quantitative approach to investigate the impact of Extroversion traits and the impact of interactive marketing strategy and promotion marketing strategy on consumer impulse purchases in the Chinese live streaming market. An online questionnaire was used as the research tool to collect data online to support the underlying data. Questionnaires are generally used in quantitative research, where researchers collect data on respondents’ attitudes, behaviors, predictions or perceptions, and attitudes towards the research topic.
Measurement and Scales
In this study, the influence of extroverted personality on impulse shopping was investigated, in which extroverted personality traits were the independent variable and impulse buying was the dependent variable. In order to make the measurement more accurate, people with experience of live shopping are first screened for the survey through this method, and all respondents must have had the experience of live shopping in the past. This questionnaire will use the NEO-FFI-3 measures to validate Personality traits (Costa and McCrae, 2010)
The NEO-FFI-3 theory consists of 60 psychological personality scales, and in this study, the focus is on the relationship between extroverted personality traits and live impulse consumption. Therefore only eight items from the NEO-FFI-3 will be selected for testing. The impact of social presence on Impulsive Buying Behavior is measured in two dimensions: the social presence of viewers and the Social Presence of the broadcaster (Johnson and Hong, 2020). In the marketing strategy, this level specifically will be studied from the perspective of price promotion and limited-time promotion, respectively. Three items are selected for investigation, and there are four items measured for live e-commerce impulse buying (Liu, 2016), as shown in the Tables below.
All research questions will be measured on a 5-point Likert scale, and respondents will select the following options: 1. Strongly disagree; 2. Disagree; 3. Neither agree nor disagree; 4. Agree; 5. Strongly agree (Malhotra, 2010). Respondents made their choices based on their level of approval, and this made it easier for respondents to understand. In addition, as the study is about live streaming in the Chinese market, this questionnaire will be translated into Mandarin.
Sampling And Data Collection
The first part of the questionnaire consisted of collecting personal information about the respondents, including their gender, age, income, frequency of live streaming, frequency of shopping through live channels, and the highest level of education. The data is disaggregated to make it more accurate, as differences in income, age, and gender can have a different impact on the results. Secondly, a 5-point Likert scale measuring variables from strongly disagree (1) to strongly agree (5) was used to gather information for the survey. At the data analysis level, this experiment will use SPSS 10.0 to analyze this data. For some complex data research, SPSS has some advantages. SPSS is a statistical software used in social sciences that helps the researcher to analyze the data and helps the researcher to analyze the relationship between the variables and the dependent variable using simple linear regression. (Cousineau, 2020).
Analysis and Results
Demographic Profile
As shown in Table 1, the final valid sample for this study was 228, of which 124 were female, accounting for 54.39%, and 104 were male, accounting for 45.61%. In terms of age group, there were relatively more “18-25 years old” in the sample, accounting for 31.14%, followed by the 26-30 age group with 20.18%. In terms of education level, the largest number of respondents had a bachelor’s degree, accounting for 51.75% of the sample. In terms of time spent on live streaming per week, 67.11% of the sample spent “less than 3 hours.” In terms of the distribution of monthly spending on live streaming, most of the sample spent “RMB 2001-4000”, with a proportion of 38.60%, and “less than RMB 2000” with 35.53%.
Reliability and Validity
Cronbach’s alpha is a reasonable index to test the reliability of questionnaires and is widely used in empirical data analysis. Generally speaking, when the Cronbach alpha value of the scale designed by the questionnaire is even lower than 0.7, it means that the internal consistency of the variables of the scale is poor, and the scale needs to be recompiled. When the Cronbach alpha value of the scale is higher than 0.7, it can mean that for the scale, the internal consistency of the constructed variables is good. Furthermore, if the Cronbach alpha value of the scale can be higher than 0.9, it means that the scale is designed for the scale. The internal consistency of variables was excellent, and the measurement reliability was very high (Fornell and Larcker, 1981).
The results of this study showed that the Cronbach Alpha (CR) value of the ET(Extraversion traits) variable was 0.921; for SPB(Social Presence of the broadcaster) variable was 0.875; for SPV(Social presence of viewers) variable was 0.882; for PP(Price promotions) variable was 0.907; for the LTP(Limited-time promotions) variable was 0.908; for the IBB (Impulsive Buying Behavior)variable was 0.930. The Cronbach Alpha value of each variable was greater than 0.7, indicating that the internal consistency of each variable in this study was good, and the data passed the reliability test.
Confirmatory factor analysis (CFA) was performed using AMOS23.0 software, and convergent validity of the scale was analyzed with combined reliability (CR) and mean extraction of variance (AVE) (Gefen, Straub and Boudreau, 2000). It can be seen from Table 2 that the standardized factor loadings of the 24 measurement indicators in the model range from 0.694 to 0.942. Each is greater than 0.50, and the corresponding significant P values are all less than 0.05, indicating that each latent variable has a significant influence on the observed variable. The topics corresponding to each latent variable are highly representative; at the same time, the average variance extraction value of each latent variable AVE is between 0.594 and 0.775, which are all greater than 0.5, and the combined reliability CR value is between 0.876 and 0.931. All of them are greater than 0.7, indicating that the convergent validity of each variable in this study is ideal.
Table 2. Reliability and validity test results
Hypothesized Direct Relationship
This essay adopts Multiple Linear Regression to analyze the data. This approach allows the researcher to analyze more clearly whether the hypothesis is valid and the relationship between the independent and dependent variables (Preacher, Curran, and Bauer, 2006). Taking ET(Extraversion traits), SPB(Social Presence of the broadcaster), SPV(Social presence of viewers), PP(Price promotions), and LTP(Limited-time promotions) as independent variables and IBB(Impulsive Buying Behavior) as a dependent variable, the regression model of this study was obtained by multiple linear regression. The adjusted R2 value of the model is 0.317, which means that ET, SPB, SPV, PP, and LTP in this study can explain 31.7% of the changes in IBB. When the F-test was performed on the model, it was found that the model passed the F-test (F=22.093, p=0.000<0.05), indicating that at least one of ET, SPB, SPV, PP, and LTP would have an impact on IBB, and the model was valid. Moreover, the DW value is 1.944, which is near the number 2, which means that there is no autocorrelation in the model, there is no correlation between the sample data, and the model could be considered superior.
It can be seen from the path coefficient results that ET will have a significant positive impact on IBB ( ÎČ =0.146, t=2.269, p=0.024<0.05), so it is assumed that H1 is established; SPB will have a significant positive impact on IBB relationship ( ÎČ =0.182, t=2.915, p=0.004<0.05), so H2 is assumed to hold; SPV will have a significant positive effect on IBB relationship ( ÎČ =0.162, t=2.576, p=0.011<0.05) , so it is assumed that H3 is established; PP will have a significant positive effect on IBB ( ÎČ = 0.172, t = 2.805, p = 0.005 < 0.05), so H4 is assumed to be established; LTP will have a significant positive effect on IBB. There is a direct influence relationship ( ÎČ = 0.182, t = 2.969, p = 0.003 < 0.05), so the hypothesis H5 is established.
Table 4. Hypothesized Direct Relationship
Discussion and Conclusion
Discussion
This study examined the effects of extroverted personality, social presence (Social presence of viewers, Social Presence of the broadcaster), and Marketing Strategy (Price promotions, Limited-time promotions) on Chinese consumers’ impulse buying behavior during live shopping. The experiment was conducted with 228 Chinese consumers who had a live shopping experience spread across all regions of China, and the following findings were obtained through validation.
The influence of extroverted personality on Impulsive Buying Behavior
The results of the experiment confirmed a positive correlation between extroversion and impulse buying. This result suggests that people with an extroverted personality (good with people and willing to express their opinions) are more likely to interact with the anchor because they are sociable and are guided by the anchor to make impulse purchases. Based on this finding, it is therefore important that both marketers and retail salespeople target extroverts at the marketing level, as this group is easily persuaded, and marketing strategies that target extroverts can increase sales conversions for companies. Moreover, because they are receptive to new things, live streaming is a particularly innovative form of broadcasting that can stimulate the interest and desire of extroverts to make impulse purchases. For anchors (marketers), it is important to target consumers based on their attributes, with a particular focus on extroverted consumers.
In terms of marketing strategies, it is recommended that operators adopt more innovative sales channels and methods to stimulate the curiosity of extroverted consumers in order to promote the conversion of extroverted consumers better and thus increase sales. The use of live streaming, for example, and the use of offline pop-up stores, for example, are innovative ways to stimulate consumers’ desire to buy. Secondly, the marketing content can also be innovative. For example, live broadcast is not only limited to the daily ordinary live broadcast but also can plan some thematic live broadcast to increase the degree of innovation of live broadcast. For example, many brands nowadays will carry out immersive live broadcasts through the scene and the environment to make the live scene more with a sense of reality, but also so that the product can match the product and the environment for sales (for example, beach live scene selling drinks). Alibaba (China’s largest e-commerce trading platform) organizes immersive live-streaming events every year for specific promotional holidays, and each time it generates excellent revenue (FlippingBook, 2022).
At a consumer level, people with an extroverted personality are likely to have a high frequency of impulsive purchases, and consumers should be careful to avoid impulsive purchases due to weak self-control, which often result in impulsive purchases with low suitability (Badgaiyan & Verma, 2014). Therefore, consumers who score higher on the extrovert personality scale are more open to everything, and therefore these traits lead them to make impulsive purchases.
Impulsive consumption is actually a form of irrational consumption, which is a form of overconsumption due to the consumer’s own personality and lack of self-control (Bhakat and Muruganantham, 2013). There are ways that extroverted consumers can try to reduce their impulsive spending behavior, such as adopting a delayed gratification approach, where delayed gratification can help to control short-term spending desires to a certain extent. It has been shown that many impulse purchases are made on the spur of the moment, so when the desire to consume is delayed for a certain amount of time, the consumer loses some interest in the product and can then make a rational decision as to whether to purchase the product (Funder, Block, and Block, 1983). Consumers can also control their impulse buying behavior by diverting their attention, for example, by reducing the rate at which they watch live e-commerce streams to reduce their desire to consume.
In summary, consumers with a high extrovert personality score are more likely to make impulsive purchases, which can be used to help make a quick profit from a business perspective, while consumers need a better way to discourage impulsive purchases and think more rationally to make purchasing decisions.
The Influence of Social Presence on Impulsive Buying Behaviour
Prior studies on live streaming commerce have emphasized various aspects that drive viewers and streamers to engage in live streaming (Chen and Lin, 2018). Studies have looked at perceived values, utilitarian or hedonic motives, and perceived utility (Cai et al., 2018; Wongkitrungrueng and Assarut, 2018), while others have examined the role of system elements in live streaming commerce, such as the gift-giving function or user experience and interface design (Xu et al., 2020). However, one of the key components of live streaming commerce is presence, which is insufficiently discussed in the body of existing research.
Consumer engagement in e-commerce is likely to be limited by the lack of presence (Hamari et al., 2016), but live streaming commerce has improved presence due to technological advancements (Liu et al., 2020). Telepresence and social presence enable customers to build stronger relationships with online suppliers and gain a deeper understanding of the service or item they are looking for (Ye et al., 2020). Social presence can lead to impulsive purchasing behaviors, which is extremely typical in live streaming commerce (Shen and Khalifa, 2012). (Zahari et al., 2021). This essay adds additional confirmation about the positive effect of social presence on the impulsive behavior of consumers.
Social Presence of Viewers
Online shoppers cannot physically touch or feel the thing, unlike those who buy in stores; instead, they can only visualize the goods through photographs or text descriptions of the products (Jiang et al., 2019). Simultaneously, it is possible to consider buying as a form of social interaction. Online purchase becomes more sociable when customers interact with one another, which lessens the feeling of alienation associated with purchasing (Pavlou et al., 2007). Viewers can learn more about items or live streaming in live streaming commerce by reading the comments of other viewers. Viewers are more likely to trust live streamers and the things they advertise if peer reviews are positive because persuasion is more effective when it comes from others who share similar values (Lu et al., 2016).
Previous research has demonstrated that purchasers’ social presence may favorably increase consumer trust (Ye et al., 2020). Live streaming shopping also benefits from the arrangement, given that viewers are potential customers. As was mentioned before, text-based chat channels and live video material are combined in live streaming commerce. Through the chat channel, viewers may co-experience live streaming and influence one another’s viewing experiences (Lim et al., 2012). The interaction between chat box users improves viewers’ feelings of social presence (Kim, 2015), enticing them to engage in and become fully involved in the information exchange (Li et al., 2018).
From the results of the questionnaire, it was established that the proposed hypotheses H2 and H3 are valid. In other words, the interaction between the anchor and consumer and the interaction among consumers have a positive impact on consumer impulse purchases in the reviewed Chinese market. However, there is a plausibility of the universality of the hypothesis, meaning that the data results could be similar or compared with other countries’ live e-commerce markets.
Social Presence of Broadcasters
In the subject of live e-commerce impulsive purchases, the effect of social presence is also a crucial element. The existing corpus of research often recognizes that consumer trust in online commerce is likely to be impacted by various factors. These factors include the standing of sellers, the absence of face-to-face communication, low psychological connections, and human warmth (Oliveira et al., 2017; Ye et al., 2020). Because live streamers can show items in-depth through video, engage with viewers in real time, and provide individualized assistance to them, live streaming commerce has a higher feeling of social presence (Wongkitrungrueng and Assarut, 2018). Some researchers recognize that the social presence of streamers reduces the psychological gap between viewers and streamers and can increase viewers’ sense of trust by assisting viewers in better understanding the product they want (Jiang et al., 2019). Previous research has examined the effects that vendors’ social presence has on consumer trust (Ye et al., 2020). The social presence of live streamers and customer trust are seen to be related as they may also be thought of as salespeople.
This research found plausibility in the social presence of broadcasters and its positive influence on impulsive behavior in Chinses live-stream commerce. However, the origin remains the subject of debate. However, the available literature offers some explanations on this subject. For example, because broadcasters can better tailor their offerings to viewers’ needs thanks to their social presence, viewers are more focused on live streaming commerce (Yim et al., 2017). More human features in live streaming commerce, where consumers may interact with broadcasters and contact them in real-time as if they were conversing face-to-face, can also boost consumers’ enjoyment of purchasing (Liu et al., 2020). According to BrĂŒndl et al. (2017), social live streaming platforms may be seen as hedonic information systems. According to Wirtz and Göttel (2016), consumers’ perceived delight is a crucial driver for viewers to engage in live streaming commerce. Flow state may be produced by increasing focus and enjoying oneself while shopping. Prior studies have demonstrated that social presence can raise customers’ reported satisfaction and cognitive absorption levels (Shen, 2012; Leong, 2011).
Moreover, if celebrities are chosen as the representatives for the product, their influence or fan base may prefer completing an impulsive purchase due to the personal attribution of credibility to a particular celebrity. In other words, the presence of a celebrity triggers an appeal to authority which may influence the decision to purchase a particular product. This is a common marketing strategy that is utilized globally for product or service advertisements.
The Influence of Marketing Strategy on Impulsive Buying Behavior
Marketing strategies in online commerce focus on exploiting various design features of the internet. Specifically, impulsivity is brought on by the ease of access to the purchase of goods, the absence of social restraints, and the lack of delivery attempts. The literature on marketing demonstrates that the mindset induced by the online purchasing environment may be used to study impulse purchases. The irrationality of impulse purchase decision-making from the perspective of the internet purchasing environment has been shown in prior studies. Namely, the argument is that impulsive online purchases are made in an unreasonable manner without giving the need for the goods careful attention. More specifically, this illogical impulse purchase decision-making is characterized by two key factors. First, there is no cognitive thought or planning involved in the process. Second, the impulsive purchase process is dominated by emotions. However, it is undeniable that online marketers try to enhance the impulsivity of their customers through various techniques. This study has identified that Price Promotion and Limited Time Promotion both have an effect on promoting impulsive buying behavior.
Price Promotion
Discounts are often applied as part of the price promotion strategies. In this approach, consumers are provided the product popular in one retailer at a lower price (Xu and Huang, 2014). After seeing the goods at a store, whether online or off, consumers frequently make purchases on the internet because they want to save money and get the best deal possible (Schneider and Zielke, 2020). Additionally, given that price reduction is argued to be a more effective indicator of the intention to make an impulsive purchase (Xu and Huang, 2014), and the variety of price options offered by online retailers is claimed to have a significant impact on impulsive online purchases (Park et al., 2012). This research recognizes the effectiveness of price promotion strategies as it appears that there is a positive correlation between the strategy and online impulsive purchasing behavior.
Limited Time Promotion
Limited Time Promotion has a significant impact on the impulsive purchases of the customers. The research body on this marketing strategy has demonstrated successful implementation in enticing customers’ impulsive purchases. This trend could be seen globally via such events as Black Friday or Singles’ Day. The latter event originated in China and was marked as an unofficial holiday that celebrates people that are not in a relationship and a shopping season (Carsten, 2015). To commemorate the occasion, Alibaba, the biggest e-commerce company in China, began to offer steep discounts (Carsten, 2015). After that, this shopping occasion grew rapidly and is currently a worldwide shopping festival. The firm made $14.3 billion in under 24 hours on Singles’ Day 2015, with $5 billion coming in during the first 90 minutes of the sale on Taobao.com and Tmall.com.com (La Monica, 2015). Online stores used the limited-quantity and limited-time marketing method, in which a limited number of items are on sale within a certain time period, to attract impulsive purchases on 11/11.
The promotional offer is limited in terms of offer lifespan and is specifically made accessible for a set number of goods. After the set period, the special offer becomes unavailable to the customer. Scarcity appears to instil a sense of urgency in consumers, which leads to larger purchases, fewer searches, and more satisfaction with the items actually made, thereby supporting impulsive purchases. This marketing technique is more noticeable and effective in online platforms in contrast to the offline buying environment. Customers may monitor real-time changes in the amount of inventory that is depleting and experience the strain of time by seeing the changing availability display. Online and offline environments exhibit varied patterns of the message of scarcity. It might be readily constructed to affect scarce perceptions that might be harder to control offline.
Limited-supply communications elicit a sense of urgency and are the main sources of stimulation in the online world. IT-manipulated scarcity messages create an online shopping environment that influences consumers’ hasty buying decisions. It is possible to observe the popularity of such tactics on Chinses aggregate markets made by Alibaba group such as Tmall and Taobao. The website greets its user with numerous messages expression time limited promo discounts and other incentive to promote purchases. These practices are popular across all major Chinese online retailers that combine efforts of numerous manufacturers and sellers.
Conclusion
The first objective of this study was to examine the relationship between extraversion traits and impulsive buying behavior. The study identified a positive relationship between the two factors, which aligned with the first hypothesis. Impulsive purchases could be harmful to individuals as they are, by definition, unaccountable purchases that happen for immediate gratification. These purchases have a positive effect on the retail market but may create financial difficulties for consumers due to excessive spending. Therefore, it is possible to suggest marketers pay close attention to people with extraverted personalities as they are more susceptible to impulsive purchases. At the same time, for people possessing extraverted personality traits, restrictions on impulsive buying should be placed to avoid unnecessary purchases.
The second objective of the study was to analyse the relationship between social presence and IBB. Specifically, to analyse how the interaction between anchor and customer affects the latterâs impulsive purchasing within the Chinese live-stream commerce market along with the effect of interaction between consumers. According to the results of the present study, SPB has the second most significant impact on IBB, while SPV is the fourth among the chosen variables. Nevertheless, both results support hypotheses 2 and 3, rendering them essential in the promotion of impulsive behavior in the chosen region.
It is essential to enhance the interactivity and communication with the customers using the social presence of broadcasters. They inevitably contribute to the entertainment of the customers affecting their emotional state and increasing their feelings of excitement. They could provide detailed information about the goods on sale and visual or practical demonstration of the product of interest. Finally, given that celebrities would be invited to conduct the broadcasting, it is possible to observe the effect of an appeal to authority where trust in the celebrity acts as a proxy towards IBB.
The impact of communication between customers is lesser due to the nature of live broadcasting instruments. They are limited in the number of comments available for display, and the speed of commentaries is dependent on the number of viewers. In other words, the high number of viewers may mostly hinder the experience of live commerce. Moreover, positive comments that may help to choose a good product or entice others the purchase one are not guaranteed. Consequently, the social presence of viewers has a lesser impact on the customers.
The final objective of this study focused on the marketing strategies that may have an effect on IBB. Consequently, limited-time promotion and price promotion techniques that were common in the live broadcasting retail environment were chosen for this research. According to the research results, both indicators demonstrated high results in the hypothesized direct relationship test, which signified the validity of hypotheses 4 and 5. Limited time promotion has had the greatest impact among the five variables selected for this research.
It is possible to attribute this influence to the effectiveness of implementation within the online commercial environment. This environment provides necessary tools such as the countdown indicating the lifespan of a particular discount offer vividly on the display of the customer and acts as leverage pressuring the customer to act rashly. Consequently, the customers are often prompted to act impulsively as their emotions are enticed by the sudden pressure of urgency. After the purchase, the customers are filled with elevated feelings of gratification since a perceived beneficial deal was conducted. A similar effect could be traced to the price promotion strategy. The fourth hypothesis claimed that factors related to price promotion had a favorable impact on online impulsive purchasing behavior. Given that it produces a meaningful consequence, the result shows that this hypothesis is viable.
In conclusion, according to the results of the research, the hypothesis concerning limited time promotion has the highest grade of validity among the five proposed independent variables. Nevertheless, each theory underwent the validity test and passed the minimal threshold for reliability consideration. Furthermore, the results of this essay could be utilized beyond the regional scope of China due to the universality of the subject implementation within the frames of an internet commerce.
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