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The Effects of Changing Technology on Shopping Trends and Social Behavior of Customers

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The Effects of Changing Technology on Shopping Trends and Social Behavior of Customers


1.1 Application Area

Retail

1.2 PESTLE Perspective

Social

1.3 Research Topic Question

How has technology changed and affected shopping trends and the social
behaviour of customers?

2.0 Preface/Abstract

The purpose of this report is to analysis the PESTLE analysis; this
report will contain one context of an Application Area, and then
choose a research question based on both. In this case am talking
about the social aspect and the retailing area. I will also being
looking at how IT technology has changed shopping trends and how its
affects the social behavior of customers.

I will also be talking about several issues that answer my research
question, mainly talking about the social perception of things. As
that is my main area of interest. I will cover such issues as credit/
debit, on-line shopping, bar code scanners, customer shopping trends,
and many more issues that are related to IT technology and retailing
and social factors.

2.1 Introduction

Aim of this project is to construct an individual report, relating IT
impacts to customers and then relating it to their behavior and how
technology has affected their behavior, looking mainly at the negative
aspects of their life. Having the latest technology innovations has
improved the image of many large and small organizations and in some
aspects the living standards of some people too.

After the construction of this report, I expect the readers to obtain
a clear view of how IT impacts are linked to customer shopping and how
that affects their social behavior as well.

3.0 The ICT industry

The ICT industry has grown very fast, over the years, these days
everything is being done on the commuters, and not manually anymore.
The ICT industry is a permanent state of evolution; it’s always
continuously changing. The product cycles seems to be getting shorter
and shorter. Customers are demanding faster response times for
delivery and repairs, and there is a consistent requirement for a
reduction in stock levels and inventory costs.

3.1 The Growth Of ICT In The Retailing Industry Over The Years

An explanation of how Technology has changed in retailing (shopping
trends) and the social aspects of people’s life.

§ Technology has invented newer things that you wouldn’t have found 30
years ago.

§ Technology has improved our methods of interacting with one another,
e.g. like mobile phones, internet, portable computers, video
conferencing etc.

§ Inventions to latest technology such as on-line shopping and credits
cards means that the information about the customers isn’t secure and
their may be a problem, where others may hack their personal
information. That’s where the data protection act comes into practice.

§ Technology has changed our everyday life, such as health care,
education, social life, our working environment, and leisure
activities.

§ Technology helps us to do things at a faster pace, whereas as before
we wouldn’t be able to do things and would have to do them mainly,
e.g. computers, help us to work better and faster.

3.2 Customer Shopping Habits/Trends

London’s west end is a key location in national and global cultures of
retailing, in particular fashion. Its retailing outlets have formed a
focus for generations of fashions producers and consumers, influencing
the ways in which manufacturers around the world display and promote
goods and individual construct their social identities. Over the years
shopping trends have changed drastically, from manufacturing sector to
retailing services.

Before there would have been human labour used and manpower in
manufacturing sectors, that’s why people wouldn’t have required
retailing services, but now the increase and demand has driven the
retailing industries to expand nation-wide and world-wide, e.g. due to
people shopping on-line customers shopping habits have changed from
going into shops from actually shopping on the web.

This affects the buying trends of customers as well, when a customer
sees that when they have purchased items over the web and the quality
of the goods are good and last long, this will help them to buy more,
and if the price is cheaper compared to buying from the actual shop
then customer will want to buy more. So if the price is low then there
is more demand for the items, and this affects the customers shopping
behaviour, as they will be buying more.

Looking at the fashion aspect of retailing, fashion changes every year
and so does the buyers needs change with it as well, this changes
their social behaviour in many aspects and changes their shopping
patterns. Therefore more people are using the retailing sector, which
means that they are using the latest technology too, such as chip and
pin, and bar-code scanner.

4.0 How Has Technology Changed and Affected Shopping Trends?

4.1 ICT Innovations

There are many IT innovations that have changed everything around us,
the way we live, the way we shop and the way we associate with each
other. Below are the some of the main innovations, which have been
outlined and stated in depth.

4.2 Types Of Cards

From cash to cards; the trends for payments methods have changed,
people prefer to pay by credit cards or store credits cards, to shop
for good over the internet, or purchase goods over the phone, where
cash wouldn’t be an appropriate method to pay for goods. However
couple of years ago this facility wasn’t offered to or available for
customers.

4.3 Credit/Debit Cards

Most retailing outlets, have introduced the chip and pin, whereas
couple of years ago they wouldn’t have that. Chip and pin is a new,
secure way to pay with a credit or debit card or charge card, due to
ICT advancements and latest technology you will simply tap in your
four digit pin number rather having to sign a receipt. For example
Safeway (food retailing) was the first UK store to introduce chip and
PIN technology

The chip is a microchip on your debit/credit card, which stores tour
card sate more securely than then a magnetic stripe, which is much
harder to copy the data from.


The PIN (Personal Identification Number) is a four-digit number you
tap in to verifiability of a transactions made by customers.

4.4 Bar Code Scanners

[IMAGE]Trends have changed; most retailers now use bar-coding
scanners. Computers can not read bar codes. For a computer to make use
of the information contained in the bar code, the bar code data must
be captured and decoded into a data format that the computer can
process. The device that reads or captures the bar code information
and sends it to the decoder is known as the bar code reader, generally
called bar code scanner.

Due to recent technology there many various types of bar code scanners
that have been implemented in many retailing outlets, such as Pen Type
Readers or Bar Code wands, Laser Barcode Scanners, CCD Barcode
Scanners, Camera Based Barcode Readers.

4.5 Touch Screen Tills

Touch screen till are a modern way to till in data, this again is
using ICT to help customers to pay for their goods, after they have
finished shopping. Is just a matter of touching the button and it does
the whole calculation summary automatically for the goods that the
customer has purchased.

4.6 Loyalty Cards/Store Cards

[IMAGE]

Trends have changed over the years due to the invention of store cards
being introduced, before if a customer purchased anything in a store,
they wouldn’t get any discounts or any benefits of shopping from that
particular store. These cards normally work according to the shopping
habits of each customer, for example if a customer buys goods worth a
lot of money they will receive more points on their store card.

Illustration 4.6 Shows Loyalty/store cards


Whereas if a customer purchases less goods they will receive less
points. Also companies have invented different types of cards for
different customers, again this looks at the shopping patterns of
customers, there are cards which give customers points every time they
purchase an item, and then they can buy items using those points. Then
on the other hand there are store cards that offer you the same
facilities as credit cards, where you can buy now and shop later.

4.7 On-Line Shopping

On-line shopping facilities available now- trends have changed from
customers actually buying goods in store, from shopping on the
internet; this gives them the flexibility to shop anytime and
anywhere, whereas before they would have to go out and travel to do
their shopping and wouldn’t have the flexibility or the facility to
shop at their own convenience and at home.

On-line shopping has potential advantages to customers, as it’s a very
popular method of shopping these days. Some of the main benefits have
been outlined below:

§ Decrease in price: items and goods are cheaper on the internet, this
due to the reason that warehouse and staff costs are lower, and also
because on-line shops or retailing outlets want to attract and retain
more customers.

§ Customer convenience: shopping on the internet is an easier method
of shopping. It can be done at home in your own convenient time and
also it’s is much faster.

§ Faster and quicker delivery: most companies’ websites deliver within
a few days, e.g. Amazon shopping catalogue, which have a next day
delivery process.

4.8 Sales Figures


[IMAGE]


Here, shopping refers to actually making purchases over the Web.


A high percentage of users (46.4%) have never used the Web for online
shopping, but 33.5% have used it a few times. An even higher
percentage of users in Europe have never used the Web for shopping
(58.8%).


Illustration 4.8 graph showing the frequency of shopping by location



[IMAGE]Respondents in the 19-25 age range are least likely to have
used the Web for shopping at least once (53.0% never have), compared
to approximately 41% who never have in the other age categories.

Illustration 4.9 graph showing the frequency of shopping by age


5.0 How has technology changed and affected the social behaviour of
customers?

Below are the main factors that have affected the society and the
social behaviour of customers such a major way.

5.1 On-Line Shopping

The social behavior of customers have changes a lot of the years, due
to all the recent IT innovations, it has affected the life’s of many
people in certain ways. On-line is one of the ICT innovations that has
affected our life’s drastically, this due to the fact that people are
relying too much on on-line shopping and aren’t stepping outside the
house to do their shopping.

This affect that it has on people is very bad as, as its making
interact with others less, more anti-social behavior is being shown.
And there health is being affected by it as well, where people used to
walk to go out to do their daily shopping, which was a god source of
exercising and maintaining their health, now they are sitting at home
and using the internet to do their shopping.

Overall interact shopping has reduced the chance of communication form
individual to individual, it has made the society become to reliant on
it. And therefore people have an anti-social behavior towards life and
people, due to the fact they are always home and not going out, even
it’s a five minutes work to the shop they still won’t go out.

Social implications on online shopping

Another factor to consider is that are social implications because of
on-line shopping. This is because the data that is stored about
customers is very confidential, and many retailers have taken drastic
steps to make that customer data is secure. To ensure that retailers
have kept the data secure, they have brought in the Data Protection
Act 1998.

Implicit understanding of the Data Protection Act 1998

The Data Protection Act of 1998 contains eight Data Protection
Principles:

1. Personal data shall be processed fairly and lawfully.

2. Personal data shall be obtained only for one or more specified
and lawful purposes, and shall not be further processed in any
manner incompatible with that purpose or those purposes.

3. Personal data shall be adequate, relevant and not excessive in
relation to the purpose or purposes for which they are processed.

4. Personal data shall be accurate and, where necessary, kept up to
date.

5. Personal data processed for any purpose or purposes shall not be
kept for longer than is necessary for that purpose or those
purposes.

6. Personal data shall be processed in accordance with the rights of
data subjects under this Act.

7. Appropriate technical and organizational measures shall be taken
against unauthorised or unlawful processing of personal data and
against accidental loss or destruction of, or damage to, personal
data.

8. Personal data shall not be transferred to a country or territory
outside the European Economic Area unless that country or
territory ensures an adequate level of protection for the rights
and freedoms of data subjects in relation to the processing of
personal data.

Act was obtained from source
http://www.watchfire.com/legislation/dpa.aspx

5.2 Credit/Debit Cards

Credit cards/debit cards and loyalty cards are another method which
has affected the social behaviour of customer or shoppers. This is
because more and more customers s seem to be making payments by phone
for the goods they have purchased, so for example if someone orders a
pizza they will make a payment on the on the phone via card, this is
making them lazy and to reliant on the phone.

Again this is making them anti-social staying at home and not
interacting with others, not going out and understanding what going on
with the society.

[IMAGE]

Even in stores when people shop or over the internet, they intend to
use cards these days, just because they find it a hassle to go to the
cash point and withdraw. Again this is making them lazy. But however
what people don’t really understand is that the more they are shopping
with credit/ debit card and less with cash, the more the credit card
frauds risk are increasing, that’s why most retailer are introducing
pin and chip which is reducing fraud.

Illustration 5.2 graph showing card fraud rate in UK

The graph bellow shows that credit card fraud in the U.K. is growing
rapidly and currently costs the industry over £400 million a year -
equivalent to £4 for every credit and debit card issued in the
country. Over the next two years, fraud levels are expected to rise to
over £800 million.

5.3 Environmental And Transportation Issues

Another aspect in which technology is being used in retailing is via
transport, e.g. cars and tracks being used to distribute retail goods
to companies or external entities, this is also good for individuals
as well who wish to go where ever they want, without this they
wouldn’t be able to do get anywhere and carry out their day to days
tasks if they are far. For example going to work or picking up their
children from school.

But however there is a down side to having transport inventions,
because it has a social affect on people, even for the smallest things
they are using cars, if someone wanted to go to the local newsagents,
which is a 5minutes walk they will use a car. Again this is bad for
their health as they aren’t walking or exercising. Also using the car
all the times means that cars are producing more car exhaust
pollution, which isn’t good for the environment or people.

Also road traffic is a major cause of both air pollution and noise.
All motor vehicles emit fumes which reduce local air quality, add to
low level ozone and can cause health problems.

Diesel exhaust is being linked to asthma and causes most of the black
soot which discolours buildings. All exhaust fumes contribute to
global warming and cause acid rain.

Last two paragraphs taken from the sources
http://www.eastherts.gov.uk/poll/car_pollution.htm

6.0 Conclusion

Overall, the technology has changed the modern society in many
different ways, as people tend to advance along with the technology.
These changes have led to people being more communicative to each
other and work together in a way that they choose to. They have more
control over the things they do. Technology brings people closer
everyday. Since new technology comes out quickly people are forced to
buy them even if they don’t need these goods. The marketing power of
these new technology products is immense.

Most of the work these days is done from home and things like the
Internet shopping, Online banking, Mobile Phones, Portable computers,
and Online chat has helped people to stay in touch and brings them
closer and enables them to keep in touch with their friends and
families.

It also makes our life more complicated and we have access to a great
deal of information than before. The retail industry has taken
advantage of these new technologies and using it to its full
potential. The current advancement in these technologies is driving
the people to buy new things often and make them feel happy about it.

The products of technology are available to almost everyone in
society. Cars influence the ways communities are developing.

It’s the modern day social backbone of communities without it some
remote communities wont exist

Cars and trucks are essential for transport of the retail goods and
give the people the freedom to go anywhere they want

7.0 Bibliography

All the data used in this report was obtained from the following
sources;

www.pinpad.co.uk/ industry/background.html


http://www.cc.gatech.edu/gvu/user_surveys/survey-04-1996/graphs/use/shopping.html


www.tnt.com/country/en_generic/ services/industry/ictindustry..html


http://www.btplc.com/Societyandenvironment/Socialandenvironmentreport/Economics/Indirectimpacts/Growthandproductivity.htm


http://www.watchfire.com/legislation/dpa.aspx

http://www.eastherts.gov.uk/poll/car_pollution.htm

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