Mobile commerce (M-commerce) is any transaction, involving
the transfer of ownership or rights to use goods and services, which is
initiated and/or completed by using mobile access to computer-mediated networks
with the help of an electronic device, such as a mobile phone, a PDA or
a smart phone (Tiwari
& Buse 2007). The Generation Y refers to a specific cohort of individuals born, roughly, between
1980-1994 who are now entering colleges and universities
(McCrindle Research 2008). It is argued that there are generally higher usage and familiarity with communications,
media, and digital technologies in the Generation Y than the previous
Generation X (Junco & Mastrodicasa 2007). Kazakhstan,
a central Asian nation with 16 millions people, has an Internet penetration
rate of 34.3%, a mobile phone penetration rate of 100% (International Telecommunication Union 2009) and a population median age of 29.5 (CIA- The World
Factbook 2013), representing an ideal environment to study M-commerce adoption
among the Generation Y. Due to its inherent
characteristics such as ubiquity, personalization and flexibility, M - commerce
promises businesses unprecedented market potential (Siau & Shen 2003). However, there is only marginal use of mobile devices for
transaction purposes in Kazakhstan (Halyk Bank Press Service 2009).
This study investigates:
i) The determinants of behavioural intent to adopt
M-commerce among the Generation Y in Kazakhstan.
ii) Whether gender has an impact on the determinants of
behavioural intent to adopt M-commerce in Kazakhstan?
Conceptual model
According to the Diffusion of Innovation (DOI) theory (Rogers 1983), technological innovation is communicated through particular channels, among
members of a social system over time, working through five stages: Knowledge,
persuasion, decision, implementation and confirmation. There are five perceived
characteristics of innovation that can be used to form a
favourable/unfavourable attitude toward the innovation at the persuasion stage:
i) Compatibility: The degree to
which an innovation is perceived as consistent with the existing values, past experiences,
and the needs of potential adopters. Incompatibility
with the values and norms of a social system leads to poor or slower adoption.
ii) Complexity: New ideas that are simpler to understand
are adopted more rapidly than innovations that require the adopter to develop
new skills and understandings.
iii) Observability: The degree
to which the use and benefits of the innovation are visible to others, and
therefore act as a further stimulus to uptake by others.
iv) Trialability: An innovation that is trialable
represents less uncertainty to the individual who is considering it for adoption,
who can learn by doing.
v) Relative advantage: The greater the perceived
relative advantage of an innovation over the one it supersedes, the more rapid
its rate of adoption will be.
Rogers’ DOI (1983) has been
adopted and widely studied in mobile setting. For instance, Wu and Wang (2005) indicate that perceived relative advantage and compatibility
influence favourable attitude towards M-commerce. Similarly, empirical study by
Tanakinjal, Deans and Gray (2010) suggest that compatibility, complexity,
trialability and relative advantage affect behavioral
intention towards mobile marketing in Malaysia (observability was excluded). Recent case study by Borg and Persson (2010) supported the
relevancy of all five perceived characteristics of innovation in Rogers’ DOI in forming favourable attitude towards mobile transaction in South Africa.
Correspondingly, the following hypotheses are proposed:
H1: Compatibility determines the behavioural intent to
adopt M-commerce among the Generation Y in Kazakhstan
H2: Complexity determines the behavioural intent to adopt
M-commerce among the Generation Y in Kazakhstan
H3: Observability determines the behavioural intent to
adopt M-commerce among the Generation Y in Kazakhstan
H4: Trialability determines the behavioural intent to
adopt M-commerce among the Generation Y in Kazakhstan
H5: Relative advantage determines the behavioural intent
to adopt M-commerce among the Generation Y in Kazakhstan
One limitation of the Rogers' DOI (1983) is that it does not
identify social factors such as trust, that may influence users’ attitude
towards new innovation. According to Siau and Chen (2003), trust is one of the major factors
influencing peoples’ decisions to provide their personal data via an electronic
medium. Studies by Joubert and
Van Belle (2009) and Tanakinjal et al. (2010)
indicate that trust influences
intention to adopt M - commerce. In addition, perceived
risk is a necessary antecedent for trust to be operative and an outcome of
trust building is a reduction in the perceived risk of the transaction or
relationship (Mitchell 1999). Perceived
risk is an uncertainty regarding the possible negative consequences of using a
product or service and is a combination of uncertainty with the possibility of
serious of outcome (Bauer 1967). Wu and Wang (2005) and Tanakinjal et al. (2010) view
perceived risk as influential determinant of behavioural intent to adopt
M-commerce. Taking the perspective that trust is a
willing dependency on another’s action and that the outcome of trust is an
evaluation of the congruence between expectations of the trusted party and
actions (Hupcey et al. 2001), this study
proposed:
H6: Trustworthiness determines the behavioural intent to
adopt M-commerce among the Generation Y in Kazakhstan
H7: Perceived riskdetermines
the behavioural intent to adopt M-commerce among the Generation Y in Kazakhstan
Research methodology
Questionnaire
and samplings
The
pre-tested questionnaire using 7-point Likert scale comprised of measurement
variables related to demographic, trustworthiness, perceived risk and Rogers’ (1983) five perceived characteristics of innovation. The measurement variables
related to trustworthiness and perceived risks were adapted from Hupcey et
al. (2001) and Bauer et al. (2005) respectively.
A total of 670 questionnaires were randomly distributed in three private institutions
of higher learning in two of the most populated cities in Kazakhstan. Out of the 345 questionnaires returned, 233 were from Almaty and
112 from Astana. The respondents were equally distributed across gender.
Statistical
analysis
Analysis of the surveys consisted of four phases. In Phase 1,
histograms of data distribution showed reasonable normal distributions
(bell-shaped curve) for all measurement variables. Its descriptive statistics
are shown in Table 1. In Phase 2, the multivariate analysis of variance showed
no significant different in all measurement variables in term of gender
(p>.05, two-tail test). Similarly, no major differences between Almaty and
Astana were found with all measurement variables. In Phase 3, exploratory
factor analysis (principal component analysis, varimax rotation) using
Statistical Package for Social Science v. 14 extracted seven factors,
representing 73.18% of the total variance explained. Variables in five
extracted factors correspond to Rogers’ (1983) five perceived innovation
characteristics. Its Kaiser-Meyer-Olkin (KMO) index value for
sampling adequacy was 0.859, and the Bartlett’s Test of Sphericity was significant
(Sig= 0.0), supporting the factorability of the dataset. The factor component
scores for all seven factors are shown in Table 2. The Average Variance
Extracted (AVE) for all seven factors was above the recommended threshold of
0.5 (Hair et al. 2010) for satisfactory convergent validity. All factors
showed internal consistency with
Composite Reliability (CR) >.7 as recommended by Hair et al. 2010).
In phase 4, Structural Equation Modeling (SEM) using AMOS 7.0 revealed
sufficient evidence of goodness-of-fit between the measuring models and the
sample data (factor validity test). Subsequent structural test produced good
fit statistics (χ2/df =1.800,
RMSEA=0.048, CFI=0.954, GFI=0.903), providing the basis for further
hypothesis testing. The factor analysis component
scores, reliability and
SEM statistics are presented in Figure
1.
Table 1: Descriptive statistics of measurement variables
Measurement variables
(code)
Mean S.D
I think it is safe to do a transaction/purchase via the mobile phone
(Risk4)
5.12 .82
I feel the current regulations on mobile communication in Kazakhstan minimise my privacy risks (Risk2)
5.19 .90
There is no more privacy risk involved in receiving marketing messages
via mobile phone than there is when getting marketing messages via email or
TV advertisement (Risk3)
5.25 .78
I think mobile
commerce will not put my privacy at risk (Risk1)
5.33 .97
Mobile commerce is a trustworthy source of information (T2)
4.84 .91
I consider mobile
commerce as a reliable way to receive relevant information (T1)
4.92 .92
Mobile commerce is reliable because mobile marketing messages are
up-to-date (T4)
5.12 .84
Provided that my permission is given, I consider mobile commerce as a trustworthy source of
personalised marketing messages (T3)
5.68 .93
People using mobile commerce are better informed than those using the
TV, newspaper and magazines about the product/service they
intended to purchase (OB4)
3.34 .97
Many people have started using mobile commerce (OB2)
3.41 .80
People using mobile
marketing services performed better communicating to their customers than
those doing business the traditional ways (OB3)
3.51 .99
There are many mobile
services that I can use (OB1)
3.91 .75
If I were to adopt mobile commerce, the quality of my information
would improve (RA2)
4.91 1.38
If I were to adopt mobile commerce, it would enhance my effectiveness
on information gathering (RA3)
4.96 1.29
If I were to adopt
mobile commerce, it would enable me to get product/service information more quickly (RA1)
5.56 1.39
If I were to adopt mobile commerce, it would fit well with the way I
like to seek relevant product and services information (COM3)
5.29 1.26
If I were to adopt
mobile commerce, it would be compatible with my Internet searching methods
(COM1)
5.37 1.10
If I were to adopt
mobile commerce, it would fit my product and services information gathering
style (COM2)
5.56 1.07
If I were to adopt
mobile commerce, it would be easy for me to adapt (CPLX2)
5.26 1.38
Learning to use
mobile commerce would be easy for me (CPLX1)
5.41 1.49
If I were to adopt mobile commerce, it would be easy due to my
previous experience with mobile phone usage (CPLX3)
5.43 1.44
Before deciding on
whether or not to adopt mobile commerce, I would be able to use it on a trial
basis (TRY1)
5.13 1.52
I would be permitted to use mobile commerce on a trial basis long
enough to see what it can do (TRY3)
5.19 1.58
Before deciding on
whether or not to adopt mobile commerce, I would be able to test the suitability of the services (TRY2)
5.20 1.45
Table 2: Factor analysis component scores of
measurement variables
Factor scale
AVE
CR
Item (code)
Loading
Perceived risk
.61
.86
I think mobile commerce will not put my privacy
at risk (Risk1)
.848
I think it is
safe to do a transaction/purchase via the mobile phone (Risk4)
.828
I feel the
current regulations on mobile communication in Kazakhstan minimise my privacy
risks (Risk2)
.801
There is no more
privacy risk involved in receiving marketing messages via mobile phone than
there is when getting marketing messages via email or TV advertisement
(Risk3)
.729
Trustworthiness
.60
.85
Provided that my
permission is given, I consider mobile commerce as a trustworthy source of personalised
marketing messages (T3)
.843
Mobile commerce
is a trustworthy source of information (T2)
.826
Mobile commerce
is reliable because mobile marketing messages are up-to-date (T4)
.774
I consider mobile commerce as a reliable
way to receive relevant infor. (T1)
.631
Observability
.50
.72
People using mobile marketing services
performed better communicating to their customers than those doing business
the traditional ways (OB3)
.784
There are many mobile services
that I can use (OB1)
.758
Many
people have started using mobile commerce (OB2)
.752
People
using mobile commerce are better informed than those using the TV, newspaper and magazines about the product/service they
intended to purchase (OB4)
.651
Rel. Advantage
.57
.79
If I were to
adopt mobile commerce, the quality of my information would improve (RA2)
.849
If I were to
adopt mobile commerce, it would enhance my effectiveness on information gathering
(RA3)
.805
If I were to adopt mobile commerce, it would
enable me to get product/service information more quickly (RA1)
.781
Compatibility
.72
.88
If I were to adopt mobile commerce, it would
fit my product and services information gathering style (COM2)
.846
If I were to
adopt mobile commerce, it would fit well with the way I like to seek relevant
product and services information (COM3)
.793
If I were to adopt mobile commerce, it would
be compatible with my Internet searching methods (COM1)
.783
Complexity
.76
.90
Learning to use mobile commerce would be
easy for me (CPLX1)
.867
If I were to adopt mobile commerce, it would
be easy for me to adapt (CPLX2)
.854
If I were to
adopt mobile commerce, it would be easy due to my previous experience with
mobile phone usage (CPLX3)
.784
Trialability
.70
.87
Before deciding on whether or not to adopt
mobile commerce, I would be able to use it on a trial basis (TRY1)
.836
Before deciding on whether or not to adopt
mobile commerce, I would be able to test the suitability of the services
(TRY2)
.830
I would be
permitted to use mobile commerce on a trial basis long enough to see what it
can do (TRY3)
.829
Figure 1. SEM statistics of the research conceptual model
Findings
and discussion
Hypothesis 1: Compatibilitydetermines
the behavioural intent to adopt M-commerce among the Generation Y in Kazakhstan generated the second highest regression weight of 0.76 amongst the various
determinants. This result replicated Wu and Wang (2005) and Borg and Persson (2010) that compatibility
affects behavioural intention to adopt M- commerce. Hypothesis 2: Complexity
determines the behavioural intent to adopt M-commerce among the Generation Y in
Kazakhstan generated a significant regression weight of 0.66. Respondents
indicated that it would be easy for them to learn (mean=5.41) and adapt to
M-commerce (mean=5.26) because of their previous experience with mobile phone
usage (mean=5.43). These findings reflected the techno savvy characteristics of
the Generation Y. There was moderate support for Hypothesis H3:
Observability determines the behavioural intent to adopt M-commerce among the
Generation Y in Kazakhstan (regression weight=.22), possibly because M-commerce is currently in its infancy in Kazakhstan.
The
hypothesis H4:
Trialability determines the behavioural intent to adopt M-commerce among the
Generation Y in Kazakhstan was also supported (regression
weight=.67) suggesting that behavioural intent to adopt M-commerce among this
cohort in Kazakhstan is dependent on their pre-adoption ability to use it on a
trial basis (mean=5.13), to test the suitability of mobile services (mean=5.20)
and the possibility to use M-commerce on a trial basis long enough to see what
it can do (mean=5.19). There was significant support
for Hypothesis H5: Relative advantage determines the
behavioural intent to adopt M-commerce among the Generation Y in Kazakhstan (regression weight=.50), a finding
consistent with that of Wu and Wang (2005).
Hypothesis H6: Trustworthiness
determines the behavioural intent to adopt M-commerce among the Generation Y in
Kazakhstan,generated the third highest regression weight of .70. In particular,
the variable ‘Provided that my permission is given, I
consider mobile commerce as a trustworthy source of
personalised marketing messages’ is the highest mean score in this study. Finally, H7: Perceived riskdetermines the behavioural intent to
adopt M-commerce among the Generation Y in Kazakhstan generated the highest
regression weight of .97 among the various determinants. There was evidence to
suggest that perceived risk is inversely related to trialability (regression
wt=-33) and relative advantage (regression wt=-24). However, gender has no significant affect on adoption intention.
Possible explanations for this finding could be that gender equality, in terms
of education exists in Kazakhstan (99.5% literacy rate, CIA FactBooks 2009) and
that women play a central role in daily economic
life of Kazakhs (Barfield 1993).
Marketing implications
The high penetration rate of mobile telecommunication and the strong
empirical evidence in support of all hypotheses in this study suggested the
viability of M-commerce in Kazakhstan. While this study showed moderate support
for observability as determinant of behavioural intent towards M-commerce
adoption, marketers need to recognise that adoption decisions are frequently
influence by peers and existing fads or fashion amongst member of a social
network (Abrahamson 1996). In this regard, mobile service providers need to
enlist more retailers to support the use of mobile devices for customer transaction,
so as to increase the observability and trialability of M-commerce.
As perceived risk was found to be the main determinant of
behavioural intent to adopt M-commerce, a physical flagship store or
distribution centre in Kazakhstan may allay customer fears of transacting
virtually and to project observability. A short trial using mobile device for
customer transaction may positively affect user’s attitude towards the practicality,
convenience and perception of risk in M-commerce. Trustworthiness was also
found to be significant determinant of behavioural intent to adopt M-commerce.
This is especially so with regards to permission for personalised marketing messages,
which was the highest scored variable in this study. One
solution to address this concern is to employ permission based mobile marketing
so that M-commerce users are in control of the types and volume of marketing messages they receive through
their mobile phones. Getting consumers permission before sending them personalised marketing messages can reduce
concerns about privacy violation, thus developing trust in the mobile service
providers. Personalised marketing messages can be seen as a strategy to reduce
clutter and improving targeting precision for marketers (Krishnamurthy 2001).
Conclusion
and research limitations
This study showed that perceived risk and
trustworthiness, in conjunction with Rogers’ (1983) five perceived characteristics
of innovations are important determinants of behavioural intent to adopt
M-commerce among the Generation Y in Kazakhstan. Gender has no significant
affect on adoption intention. Implications for
marketers and mobile service providers are discussed. In particular, the issue of
risks, privacy violation and permission-based marketing in M-commerce are
important factors to consider. The limitations of this study are that it has
not yet explore other potential factors (technology enabler, network
aggregator, content provider and wireless operators) that may determine
behavioural intention towards the adoption of M-commerce. Overall, this study
contributes to our understanding of mobile commerce adoption among the
Generation Y in Kazakhstan.
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