Evaluating Internet Marketing Effectiveness by Calculating Customer Transaction Cost and Analysis of its Attractiveness in the Flower and Plant Market in Iran

Document Type : Research Paper

Authors

Department of Agricultural Economics, Faculty of Agricultural Economics and Development, University of Tehran, Karaj, Iran

10.22059/ijaedr.2022.332478.669094

Abstract

In addition to improving market efficiency by increasing competition, Internet markets have contributed significantly to provide demand-oriented production. flower and plant market of Iran has a traditional structure and profit-seeking has added to the complexities of this market. Internet marketing is able to solve this problem and improve the efficiency and productivity of this market.



Methods

In this study, the flower and plant market will be investigated. The data is cross-sectional and related to the customers of both online and offline markets in 2017. The data collection is done by filling questionnaires by both online and offline customers. The main purpose of this study is to calculate the effectiveness of Internet marketing compared to offline. In addition, the logit model is estimated with the dependent variable of customer satisfaction from internet marketing in this market.



Results

The results showed that the transaction costs for customers in other provinces were higher than Tehran and Alborz in both markets and in the online market, were lower than the traditional market. Consequently, Internet marketing surplus in other provinces (except Tehran and Alborz) was higher and the transaction cost share from product prices was lower. According to the above results, internet market development will lead to improve the effectiveness of the flower and plant market. As a result of the logit model, incentives for cash discounts, social media pages (Instagram), easier online shopping, gender and regional effects have become significant.



Discussion

In the logit model, the factors affecting customer satisfaction with online flower shopping were estimated. As a result of the significance of the cash discounts incentives variable, suggested that an amount must be considered as a discount, especially for customers who have made more frequent purchases. Supporting electronic business will ultimately lead to a reduction in consumer costs and at the same time a boom in the domestic product market.

Keywords

Main Subjects

Iranian Journal of Agricultural Economics and Development Research

Articles in Press, Accepted Manuscript
Available Online from 31 October 2022

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