A NEW HORIZON BECKONS FOR SAUDI ARABIA IN THE
TECHNOLOGICAL AGE OF E-COMMERCE & ON-LINE
SHOPPING
Khalid Al-Diri, Dave Hobbs
Informatics school, Bradford University, Bradford, UK
Rami Qahwaji
Informatics school, Bradford University, Bradford, UK
Keywords: E-Commerce, E-Vendor, Internet, Online Shopping, Saudi Arabia.
Abstract: Electronic commerce is a worldwide phenomenon. Its diffusion has apparently taken different paths in
different nations. This is partially because of the significant differing characteristics of national
infrastructural and the political and socio-economic environments for e-commerce adoption. The growing
use of the Internet in Saudi Arabia provides a developing prospect for e-shopping. Despite the high potential
of online shopping in Saudi Arabia, there is still a lack of understanding concerning the subject matter and
its potential impact on consumer. This paper is part of larger study, and aims to establish a preliminary
assessment, evaluation and understanding of the characteristics of online shopping in Saudi Arabia, based
on a sample of 144 Internet users, it explores their information-seeking patterns as well as their motivations
and concerns for online shopping. Consumers in Saudi Arabia still lack of trust in the vendors’ websites
when utilizing the Internet as a shopping channel. They are mainly concerned about issues related to
security and privacy when dealing with online vendors, and also about issues regarding the Saudi Internet
network, English language as a dominant Internet language. While the most motivators for Saudis to utilize
the online shopping were convenience, product/service not available offline, and the price respectively. We
present and discuss our findings, and identify changes that will be required for broader acceptance and
diffusion of online shopping in Saudi Arabia.
1 INTRODUCTION
The arrival of the Internet has affected today’s world
in the same way that the industrial revolution
affected the societies of previous centuries. The role
of new information and communication technologies
(ICT) and e-commerce in driving the global
economy is widely recognized. ICT and the Internet
reach many people, have a wide geographical
coverage and are efficient in terms of time and cost.
They facilitate access to markets, commercial
information, new processing technologies and
knowledge; they helped foster an environment that
promotes the globalization of markets throughout
the world.
Most of the research relating to e-commerce has
been carried out in the West, mainly in the US.
Despite its growing importance, academic research
in this area is particularly lacking in Saudi Arabia.
Considering that online shopping in the context
of Saudi Arabia is still at the early stage of
development, little is known about consumer
attitudes toward adopting this new shopping channel
and factors that influence their attitudes towards it.
Therefore, this study, part of a larger investigation of
Saudi Internet users, aimed to examine the current
users of online shopping in Saudi Arabia with the
intention of establishing a preliminary assessment,
evaluation and understanding of the characteristics
of online shoppers in Saudi Arabia. Towards this
end, the study was carried out to try to establish the
extent of the use of Internet technology by Saudi
people, the motivating factors for using online
shopping, the barriers that prevent Saudi users from
using Internet technology for their shopping, the
362
Al-Diri K., Hobbs D. and Qahwaji R. (2007).
A NEW HORIZON BECKONS FOR SAUDI ARABIA IN THE TECHNOLOGICAL AGE OF E-COMMERCE & ON-LINE SHOPPING.
In Proceedings of the Second International Conference on Signal Processing and Multimedia Applications, pages 352-357
DOI: 10.5220/0002134303520357
Copyright
c
 SciTePress

most trusted online shopping sites (Arabic or
foreign).
2 LITERATURE REVIEW
2.1 Profiles of Online Shoppers
Demographics and lifestyle characteristics play an
important role in customer buying habits and in on-
line shopping behaviour. Many Internet studies
(Swinyard and Smith, 2003, Bellman, Lohse, and
Johnson, 1999) show that the on-line population is
relatively younger, more educated, and wealthier
than the general population, more computer literate
and more likely to spend time on the computer, and
more likely to find online shopping to be easy and
entertaining. This profile is not very different from
Internet shoppers in Asian regions (Technowledge
Asia, 2000). Finally, one must reckon with the
influence of cultural variables, as exemplified by the
tremendous differences between the on-line
shopping behaviour of customers in developed and
developing countries.
2.2 Motivation Factors for E-Shopping
2.2.1 Price
The first dominant factor that influences consumers
to shop online is the competitive prices and deals
offered by online vendors (Lorek, 2003; Magee,
2003; Maloy, 2003; Retail Merchandiser, 2003;
Starkov & Price, 2003, Rowley and Okelberry,
2000). Online retailers are able to offer cheaper
prices because of the shrinking cost of information
processing, lower operating costs and global reach
provided by the Internet (Rowley, 2000). Other
reasons for competitive prices online are competitive
pressure, especially from new online retailers who
can use price as a main competitive tactic to attract
customers (Hanson, 1999), and the facility afforded
by the Internet for efficient price searching and
comparison (Haubl and Trifts, 2000).
2.2.2 Convenience
Consumers can save time and find shopping more
convenient by using online merchants to service
their needs personally. The issue of convenience and
speed seem to be the most obvious reasons why
shoppers prefer online shopping in contrast to
‘offline’ traditional bricks-and-mortar shopping
(Starkov & Price, 2003), (Rohm & Swaminathan,
2004). Consumers have been described as time
savers; thus they prefer the immediacy of online
shopping (Parsons, 2002). The 24-hour, 7 days per
week availability, location and purchasing processes
through the Internet are much superior to other
traditional shopping methods (Alreck and Settle,
2002, Bhatnagar et al., 2000). There are many types
of convenience such as time saving, time flexibility,
physical effort saving etc. Many studies cite
convenience, as the key reason for the increase in
online shopping (Lorek, 2003; Magee, 2003; Maloy,
2003; Retail Merchandiser, 2003; Rowley and
Okelberry, 2000).
2.2.3 Ease of Gathering Product
Information
Gathering product-service information easily is one
of the factors that motivates consumers to shop
online. In online shopping, searching for product
information is much more effective and efficient as
compared to traditional channels. This is achieved
by employing browser and intelligent search agents
that make the searching process on the Internet
much simpler for consumers (Lorek, 2003; Magee,
2003; Maloy, 2003; Retail Merchandiser, 2003;
Rowley and Okelberry, 2000, Rowley, 2000).
2.2.4 The Wider Availability of Product
Choices
Another factor that motivates online consumers to
use online shopping over the Internet is the good
selection and wider availability of product and
service choices offered by online vendors (Rohm &
Swaminathan, 2004). Online vendors are able to
provide wide ranging collections of products as there
is no storage limitation compared to traditional
shopping. There are many examples, like e-Bay,
Yahoo.com, and Amazon.com, who are able to offer
their customers millions of products and services on
their websites. Furthermore, the number of shopping
sites that consumers are able to visit online far
exceeds that of physical stores, thus, providing them
with a wider selection and choices.
2.3 Obstacles for E-Shopping
2.3.1 Trust
In spite of the many motivators for Internet
shopping, many consumers are still wary of
shopping online. Trust in online shopping still
represents a significant barrier for Internet users
impeding the growth the e-commerce environment
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ON-LINE SHOPPING
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(Wang, et al. 2006).
Trust is even more important in e-commerce than
in traditional commerce because of the paucity of
rules and customs regulating e-commerce, since
online services and products typically are not
immediately verifiable (Gefen and Straub 2004).
Furthermore, online transactions lack the assurance
provided in traditional settings through formal
proceedings and receipts (Gefen 2000). In the
traditional bricks-and-mortar world, consumers may
examine a merchant’s credentials and reputation in
assessing the degree to which they could trust the
vendor. In Asia, as mentioned in Wee and
Ramachandra’s (2000) study, the reasons cited for
not buying online were similar – lack of security,
lack of physical contact, uncertainty about product
quality and distrust of retailer. It is therefore obvious
that establishing consumer trust or feeling of
security is an integral part for successful online
marketing. On the other hand, privacy has been of
great concern for Internet shoppers (Grabner-
Kraeuter, 2002, Yianakos, 2002). Another type of
risk in online shopping according to Bhatnagar et al.
(2000) is that consumers may not be buying due to
the risks associated with Internet shopping, such as
the inability to touch or feel something before
buying it, including the problems when returning
products that fail to meet expectations.
2.3.2 English language
It was recently estimated that more than 60% of the
content of the Internet is in languages other than
English. It was also suggested that at least 30% of
web users prefer to conduct their on-line activities in
non-English languages, and that only one-third of
Internet businesses use English for on-line
communication (www.saudinic.net.sa). One of the
obstacles facing the growth of this penetration is the
English language barrier (www.saudinic.net.sa) since
few web users will possess the linguistic skills to
cope with information in all these languages.
Linguistic incompatibility between the information
seeker and the information provider can adversely
affect interface mastery, selection of search terms
and browsing through hypertext links, as well as
reading any actual information retrieved. The
English-speaking world does dominate the Web, but
non-English speakers are joining the Web faster than
English speakers; the usage growth from 2000-2007
is 240.7% and they have grown to represent a 35.6 %
of the world usage in 2007 (internetworldstats.com).
In this situation, language itself may become a
barrier to full exploitation of web resources. Surveys
carried out in non-English countries, for instance in
China (CNNIC, 2001), support the criticism that the
Internet is too English. This begs the question
whether the English language has been the obstacle
to Saudi Arabia’s Internet use in this English-
dominated country. In order to explore this and the
previously raised issues in respect of Saudi Arabia a
dedicated and targeted large-scale study was carried
out.
3 METHODOLOGY
3.1 Research Design
A descriptive design was used in this study, chosen
because it would help describe the current status,
and the nature and the scope of Internet use in
shopping. A survey was used to collect the data for
this study, and provided a basis for the subsequent
generalisation of the results to the whole population.
3.2 Population and Sample
A total of 144 responses were used for the final
analysis. Of these, 72 were from males and 72 were
from females.
Sampling was used to collect data from the
current Internet users in Riyadh, the capital of Saudi
Arabia, which has the highest concentration of
Internet users. The research focused on IT training
institutes, chosen because of the good mix of major
groups and levels of education and income
distribution which could affect the attitude towards
Internet usage and online purchasing. The sampling
frame targeted an equal distribution of the sexes.
4 RESULTS AND DISCUSSION
4.1 Participants Profile
The SPSS statistical analysis computer package was
used to analyse participants' responses. A variety of
statistical methods were used to analyse the data
collected in this study. Subject ages ranged from 18
to above 50 years, the majority of people being
between 18 and 25 (43.1%) followed closely by
those between 26 and 35 years (39.6%). Only 2.8%
were below 18, and no one was over 50 years. In
terms of the respondent's level of education, 43.1%
of respondents held a bachelor's degree, 29.9% %
held a two year college diploma or less, and 14.6%
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held a master's degree while 11.8% held high school
degrees, and one participant (0.7%) held a doctoral
degree.
4.2 Internet Usage
The first research question was designed to provide
information on the current status of Internet use
among the Saudi people in Riyadh. All 144
respondents indicated that they had access to the
Internet technology, 80.6% used the Internet
frequently, against 19.4% who used it occasionally.
In terms of time, 41.7% spent 1-5 hrs per week on
the Internet, 27.8% spend 6-10 hrs, 14.6% spent
between 11-20 hrs and 16.8% spent more than 20
hrs. Overall, the 144 study participants had easy
access to Internet enabling technology (i.e. . PC and
telecommunication connection to an ISP). All
participants were asked to rank several objectives of
using the Internet in terms of their importance to
them using the Likert scale from 1 to 5 (1 = Strongly
Disagree, 2 = Disagree, 3 = Neutral, 4 = Agree, and
5 = Strongly Agree). The results showed that
electronic mail (e-mail), searching for information,
online banking, and online shopping were the most
frequently used Internet tasks carried out by the
participants, with a slight difference between male
and female in the rank of their usage. The three
most popular Internet based activities were: e-mail
(mean 4.49 out of 5), searching for information
(4.44), online banking (3.56), while online shopping
was ranked fourth (2.95). When analysing the
differences in responses to the objectives of using
the Internet among participants’ gender, age, and
educational levels, Friedman two-way ANOVA
indicated that the differences were significant at the
.05 level of significance between gender, age,
educational levels and the main objectives of using
the Internet. It was clear that the majority of
participants, regardless of their gender or age or
educational levels, tended to make very high usage
of the Internet for activities such as e-mail, and
information gathering. Using the Internet for more
advanced applications such as online banking was
increasing among participants and tends to be high
usage, while for the online shopping the results
indicated only a moderate usage. In general, the
respondents’ usage for online games, chatting and
forums was low.
4.3 Motivation Factors for E-Shopping
All participants were asked to rank several reasons
for using online shopping in terms of their
importance to them with 1 being most important and
5 being least important. Collectively, the main
reason given for using online shopping was
‘convenience’. ‘Unavailability of product or service
offline’ was the second main reason given, while
‘better prices’ was the third. ‘Curiosity’ was the least
important reason for conducting online shopping
from the perspective of participants. These findings
are consistent with those of previous studies
(Grunert and Ramus, 2005; Keh and Shieh, 2001),
where convenience was also the most cited reason
for Internet shopping. But in contrast with other
studies (Starkov & Price, 2003, Lorek, 2003; Magee,
2003) the current study found unavailability of
products or services offline to be the second most
important reason, possibly explainable by the fact
that Saudi Arabia is a developing country with
limited markets. In consequence, some of the
internationally famous brands may not exist yet in
the conventional shops, resulting in consumers
turning to online shopping to widen their choice.
With respect to ‘price’, which came in third place,
this result may be due to Saudi Arabia having a
strong economy with a relatively higher GDP than
that of other Middle East countries so that its
shoppers can afford better quality products. When
analysing the differences in responses for online
shopping among participants’ gender, age,
educational levels, and time spent on the Internet,
Friedman two-way ANOVA indicated that the
differences were significant at the .05 level of
significance.. This finding is consistent with other
studies (Swinyard and Smith, 2003) where online
shoppers were also younger, wealthier, better
educated, more computer literate, more likely to
spend time on the computer and more likely to find
online shopping to be easy.
4.4 E-Shopping Obstacles
A mean scores analysis was utilised to ascertain
consumer attitudes toward factors impeding or
hindering online purchasing. The degree of barrier
effect was again measured on a five-point Likert
scale from 1 to 5 (Strongly Disagree - Strongly
Agree). Overall, the respondents indicated they had
various concerns regarding the trustworthiness of
vendors’ websites, including issues related to
security, privacy, complexity of the websites,
complexity of instructions and applications forms,
and information overload. This finding is consistent
with much research (e.g. Wang, et al.2006, (Krauter,
et al.2006) that emphasises the great importance of
trust. A high mean score with regard to not feeling
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secure and in respect of privacy concerns when
buying online are in line with the findings of other
studies (e.g. Magee, 2003; Grabner-Kraeuter, 2002;
Yianakos, 2002; Morganosky and Cude, 2000) who
found that many of their respondents also had
concerns about the security and privacy of online
buying transactions. The findings also reveal
respondents’ concerns about the cost and reliability
of the Saudi Internet network and communication
problems, since dial-up access is still one of the
major ways for citizens to access the Internet in
Saudi Arabia. Many of them cannot receive
interactive online shopping advertisements due to
limitations on bandwidth and the slow speed of
connection. Many other studies confirm that the
quality of Internet service providers (ISPs) has a
significant effect on Internet shopping experience
(Chen, Chang, 2003). English language problems
also showed a high level of importance (mean =
3.71) which is understandable given that English
was not the subjects’ native language. Thus the use
of the English language may represent an obstacle
for the Internet and its applications in Saudi Arabia.
4.5 The Most Trusted Shopping Sites
The data showed that 52.8% of male respondents
trusted the foreign website used in the study, while
47.2% of them trusted the Arabic website. In
contrast, 55.6% female respondents trusted the
foreign website, while 44.4% of them trusted the
Arabic website. Since e-commerce has been initially
created in developed countries, specifically in the
US, these countries have had more time to establish
the protocols and procedures, both legal and
financial, which control this kind of application.
Most of the online shopping companies are in these
countries, and therefore it is not surprising that they
are more trusted than Arabic shopping sites that are
still in their early stages in developing countries.
5 CONCLUSIONS
Despite the growth of e-commerce and its
applications such as online shopping in Saudi
Arabia, there is still a lack of understanding
concerning the characteristics of online shoppers in
this country and its potential impact on consumer
marketing. This may be attributable to the fact that
online shopping in Saudi Arabia is still in its infancy
and the volume of Internet buying is still too low to
assure that profitable growth will occur in the long
run. In this study, empirical research on online
shopping was analysed, and many important
variables were investigated. In order to support the
development of online shopping and attract
customers to buy online, there was a need to
understand the dynamics of the adoption of online
shopping in order to benefit its promotion and help
in the transition to a society more heavily involved
in electronic commerce. In profiling the
characteristics of online shopping users in Saudi
Arabia, the study revealed that online shoppers are
younger, wealthier, better educated, have higher
computer literacy, and spend more time on their
computer, and on the Internet. Information from this
kind of study can be usefully employed by online
vendors to develop different marketing programs
targeting this segment of society and devise
marketing strategies accordingly. One objective of
the study was to establish online shopping users’
preferences in choosing online shopping. The
findings suggested that consumers are influenced by
convenience when they shop online, searching for
products and services that are not available offline,
looking for cheaper prices, and more expecting
greater privacy, especially in the case of female
consumers, making these the dominant factors that
motivate online consumers in Saudi Arabia to shop
online. Based on the survey data, these motivating
factors for online shopping appear similar to those
for globally surveyed online shoppers. The next
objective of the study was to identify and examine
the major areas of concern and issues currently faced
by users of online shopping, since barriers are
different in different countries. In line with much
research into the factors that impede consumers from
online purchasing, the results particularly found that
lack of trust of vendors’ website, issues relating to
the cost and quality of service of the Saudi Internet
network, and problems concerning the use of
English language, to be in respectively the dominant
factors which discourage consumers from online
purchasing. The findings of the study imply that the
lack of trust in vendors’ websites was the biggest
barrier to online shopping, which includes: security
concerns associated with online purchasing, privacy
concerns, complexity of the web sites, the
complexity of instructions and applications forms
and general information overload problems. An
interesting and important finding was that the
majority of respondents trusted the foreign website
more than the Arabic website. Finally most of the
respondents expressed positive views about the
future of e-commerce and its applications in Saudi
Arabia.
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