Factors Influencing the Adoption of E-commerce in Saudi Arabia: Study of Online Shopping

Author: Abdullah Alqahtani

Alqahtani, Abdullah, 2016 Factors Influencing the Adoption of E-commerce in Saudi Arabia: Study of Online Shopping, Flinders University, School of Computer Science, Engineering and Mathematics

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The inventions of computer and internet have revolutionised the way people communicate, work and play in the modern world, and have transformed how we do business. Not only have computers and computer networks become fully integrated into most actual business operations, businesses have also moved into the virtual space available through the internet to offer products and services online.

The first e-commerce web sites began to appear in the 1980s, and with the development of the internet and its release in the early 1990s, shopping transactions online have grown steadily in sophistication and number worldwide. It is disappointing, therefore, that the Kingdom of Saudi Arabia (KSA) is lagging behind in the development of the e-commerce sector. The country is already a leading oil producer, and has made significant progress in the ICT sector in the Middle East in terms of both computer hardware and software. However, it is a matter of concern that such a wealthy country has such a low adoption of retail e-commerce, and an exploration of the reasons for the low take up of retail e-commerce (online shopping) was required, and has been undertaken in this study.

A review of the literature showed a lack of research into the adoption of e-commerce in developing countries, such as Saudi Arabia, and few studies have investigated the issue of online commerce from different perspectives. Published research lacks a comprehensive and coherent approach, and has not yet considered the views of the adopters and suppliers of retail e-commerce in a developing market like Saudi.

The major gaps in the literature are the result of a focus on the B2B model for e-commerce, and technological and environmental features, while ignoring human psychology and capacities. Another gap that of classifying the existing users into different user groups, was also identified. The research reported in this dissertation was an attempt to bridge these gaps by exploring the current situation of e-commerce (online shopping) in the Saudi Arabia, identifying the requisite factors for the adoption of e-commerce in Saudi Arabia, developing a statistical model to capture the relationship between e-commerce adoption and relevant factors from a B2C point-of-view, classifying different types of e-commerce adopters and investigating the influence of age, gender and knowledge on the adoption of e-commerce in Saudi Arabia.

In conducting the research, both qualitative (semi-structured interviews) and quantitative (online survey using Likert scaling) methods were used to generate data and the results were triangulated with existing research to observe the coherence, as well as contradictions and confirm the outcomes.

The study found that three classes of e-commerce users currently exist in the kingdom – those who frequently shop online, those who are moderate online shoppers and those who rarely go online to shop. The research also showed that Saudi women shop online more frequently than men because of Islamic culture and tradition. Greater online usage was also observed among young adults, who demonstrated a superior knowledge of ICT and the internet.

The qualitative findings highlighted the significance of the constructs in the model and emphasised the age, gender and knowledge issues specific to the Saudi Arabian cultural context. Additionally, qualitative data generation and analysis provided insight into the attitudes and feeling of users of e-commerce in Saudi Arabia. Ultimately, age, gender, ICT knowledge, payment, delivery system, product availability, trust, and prior experience all proved to be factors in the adoption of e-commerce in Saudi Arabia.

The research concluded by noting the practical implications, limitations and future directions for e-commerce in Saudi Arabia.

Keywords: E-commerce, E-commerce in Saudi Arabia, SEM,structural equation modelling, AMOS, Adoption of E-commerce.

Subject: Computer Science thesis

Thesis type: Doctor of Philosophy
Completed: 2016
School: School of Computer Science, Engineering and Mathematics