Novia Purna Ekawati Student Date Approved by: Dr

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By

Novia Purna Ekawati 2-1553-008

MASTER’S DEGREE in

BUSINESS ADMINISTRATION

FACULTY OF BUSINESS ADMINISTRATION & HUMANITIES

SWISS GERMAN UNIVERSITY The Prominance Tower

Jalan Jalur Sutera Barat No. 15, Alam Sutera Tangerang, Banten 15143 - Indonesia

Revision after the Thesis Defense on 11^th August 2017

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Novia Purna Ekawati STATEMENT BY THE AUTHOR

I hereby declare that this submission is my own work and to the best of my knowledge, it contains no material previously published or written by another person, nor material which to a substantial extent has been accepted for the award of any other degree or diploma at any educational institution, except where due acknowledgement is made in the thesis.

Novia Purna Ekawati

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Student Date

Approved by:

Dr. Antonius TP. Siahaan, SE., Akt., MM.

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Thesis Advisor Date

Parhimpunan Simatupang, SE., MBA.

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Thesis Co-Advisor Date

Dr. Nila K. Hidayat, SE., MM.

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Dean Date

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Novia Purna Ekawati ABSTRACT

The Influence of Perceived Usefulness, Perceived Ease of Use, and Cultural Dimensions towards Actual Use of E-Commerce in Indonesia

By

Novia Purna Ekawati

Dr. Antonius TP. Siahaan, SE., Akt., MM., Advisor Parhimpunan Simatupang, SE., MBA., Co-Advisor

SWISS GERMAN UNIVERSITY

In a globalization stage, e-commerce has a lot of devotees and becomes the innovation strategy for company gain marketing. Indonesian appears that not all internet users decided to become internet buyer. The interesting part is not merely that country has the similar behavior and culture to accept the e-commerce. This research examines about the influence of perceived usefulness, perceived ease of use, cultural dimensions (power distance, individualism, masculinity, uncertainty avoidance, long- term orientation, and indulgence) towards actual use of e-commerce, particularly in Indonesia. The culture dimension is following Hofstede and Minkov theory. The technology acceptance model is following Davis and Venkantesh theory. Perceived usefulness, perceived ease of use, power distance, individualism, masculinity, uncertainty avoidance, long-term orientation becomes independent variable. Intention to use becomes intervening to relate independent variable to dependent variable, in this research is actual use. The data were collected to 410 respondents using online and offline method deployment. The respondents are coming from Bandung, Medan, Jakarta, Makassar, Pontianak, and Bali. In which, those city is selected by the high percentage of internet user, population, and also capital city. As for analytic data, partial least square – structural equation modeling was used for test hypothesis. The results indicates that perceived usefulness, perceived ease of use, power distance, and masculinity influence intention to use and intention to use influence actual use of e-

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Novia Purna Ekawati commerce. Other variables such as individualism show positive influence. As for uncertainty avoidance, long-term orientation, and indulgence shows insignificant influence result to intention to use e-commerce. These results add to research on how perceived usefulness, perceived ease of use can be considering the e-commerce practices by marketing strategy. Also, the strategy can be considered about culture in Indonesia in which power distance and masculinity shows negatively significant to e- commerce.

Keywords: E-Commerce, Perceived Usefulness, Perceived Ease of Use, Power Distance, Individualism, Masculinity, Uncertainty Avoidance, Long-Term Orientation, Indulgence

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Novia Purna Ekawati

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Novia Purna Ekawati DEDICATION

I dedicate this thesis to my beloved parents, my brother, my boyfriend, and my friends. I would not here without each of them.

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Novia Purna Ekawati ACKNOWLEDGEMENTS

First and foremost, Alhamdulillah, thanks to Allah SWT, for His showers of blessings throughout my research work to complete the research successfully.

I would like to express my deep and sincere gratitude to my advisor, Dr. Antonius TP.

Siahaan, SE., Akt., MM., for his invaluable guidance throughout this research and for all the invested time in the supervision of my thesis. Furthermore, I would like to express my deep and sincere gratitude to my co-advisor, Parhimpunan Simatupang, SE., MBA., for his support and all knowledge that he shared with me.

I would like to thanks to all my fellow friends in batch 27 Master of Business Administration SGU to support throughout this research work and big solidarity. I am very grateful to have friends like all of you. Also, special thanks to Kiki Melvasari who always help, support and give me some advices when it necessary.

I would also like to thanks to my parents for their love, prayers, caring sacrifices for educating and preparing me for my future. Also I express my thanks to my brother for his support and valuable prayers. I am very much thankful to my boyfriend for his love, understanding, prayers, continuing support to complete this research work. Last but not least, thanks also to my best friend for their kindness and genuine support.

At the end, my thanks go to all the people who have supported me to complete the research work directly or indirectly.

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Novia Purna Ekawati TABLE OF CONTENTS

Page

STATEMENT BY THE AUTHOR ... 2

ABSTRACT ... 3

DEDICATION ... 6

ACKNOWLEDGMENTS ... 7

TABLE OF CONTENTS ... 8

LIST OF FIGURES ... 12

LIST OF TABLES ... 14

CHAPTER 1 - INTRODUCTION ... 15

1.1 Background ... 15

1.2 Research Problem ... 20

1.3 Research Questions ... 21

1.4 Research Objective ... 22

1.5 Significance of Study ... 22

1.6 Scope and Limitation ... 23

1.7 Chapter Summary ... 24

CHAPTER 2 – LITERATURE REVIEW ... 25

2.1 Theoretical Perspectives ... 25

2.1.1 Marketing ... 25

2.1.2 E-Commerce Overview ... 26

2.1.1.1 Definition of E-Commerce ... 26

2.1.1.2 Classification of E-Commerce by Nature of the Transactions and the Relationship Among Participants ... 26

2.1.1.3 The Benefits of E-Commerce ... 29

2.1.3 Technology Acceptance Model ... 32

2.1.4 Cultural Dimensions ... 34

2.1.4.1 Power Distance (PD) ... 35

2.1.4.2 Individualism versus Collectivism (IDV) ... 35

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Novia Purna Ekawati

2.1.4.3 Masculinity versus Feminine (MAS) ... 35

2.1.4.4 Uncertainty Avoidance (UA) ... 36

2.1.4.5 Long-Term Orientation versus Short-Term Orientation (LTO) ... 36

2.1.4.6 Indulgence versus Restrain (IND) ... 36

2.1.5 Actual System Use ... 37

2.1.6 Relationship Between Variable ... 37

2.1.6.1 Perceived Usefulness and Intention to Use ... 38

2.1.6.2 Perceived Ease of use and Intention to Use ... 38

2.1.6.3 Cultural Dimensions and Intention to Use ... 38

2.1.6.3.1 Power Distance ... 39

2.1.6.3.2 Individualism ... 39

2.1.6.3.3 Masculinity ... 40

2.1.6.3.4 Uncertainty Avoidance ... 40

2.1.6.3.5 Long-Term Orientation ... 41

2.1.6.3.6 Indulgence ... 41

2.1.6.4 Intention to Use and Actual System Use ... 42

2.1.7 Data Source and Collection ... 42

2.1.8 Research Methodology ... 42

2.1.8.1 Quantitative Research Methods ... 43

2.1.8.2 Qualitative Research Methods ... 43

2.1.9 Variables ... 43

2.1.10 Partial Least Squares (PLS-SEM) ... 44

2.2 Previous Studies ... 45

2.2.1 The Role of Perceived Substitution and Individual in The Adoption of Electronic Newspapers in Scandinavia by Nicolai Pogrebnyakov and Mikael Bachmann in 2014 ... 45

2.2.2 The Influence of Culture on Consumer-Oriented Electronic Commerce Adoption by Craig Van Slyke, Hao Lao, France Belanger and Varadharjan Sridhar in 2010 ... 46

2.2.3 The Effects of National Culture Values on Consumer Acceptance of E- Commerce: Online Shoppers in China by Yoon in 2009 ... 47

2.3 Summary of Differentiation Previous Research ... 48

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CHAPTER 3 – RESEARCH METHODS ... 53

3.1 Scope of Research ... 53

3.2 Time Frame of Research ... 54

3.3 Research Framework ... 54

3.4 Research Model ... 55

3.4.1 Framework of Model ... 56

3.4.2 Hypothesis... 56

3.5 Population and Sample ... 57

3.5.1 Population ... 57

3.5.2 Sample... 58

3.6 Questionnaire Design ... 59

3.7 Validity and Reliability Test ... 64

3.7.1 Validity Test... 65

3.7.2 Reliability Test ... 65

3.8 Method of Analysis ... 66

3.8.1 Descriptive Analysis ... 66

3.8.2 Inference Statistic... 66

CHAPTER 4 – RESULT AND DISCUSSIONS ... 69

4.1 Pre-Test ... 69

4.1.1 The Result of Validity Test ... 69

4.1.2 The Result of Reliability Test ... 71

4.2 Post-Test ... 72

4.3 The Result of Descriptive Statistic ... 72

4.4 The Result of Inference Statistic ... 78

4.4.1 Outer Model (Measurement Loading) ... 79

4.4.1.1 Convergent Validity ... 79

4.4.1.2 Discriminant Validity... 84

4.4.1.3 Composite Reliability ... 89

4.4.2 Inner Model ... 91

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4.4.3 Hypothesis Test ... 92

4.4.4 Discussion ... 93

4.4.4.1 Perceived Usefulness ... 93

4.4.4.2 Perceived Ease of Use ... 94

4.4.4.3 Power Distance ... 94

4.4.4.4 Individualism ... 95

4.4.4.5 Masculinity ... 96

4.4.4.6 Uncertainty Avoidance ... 97

4.4.4.7 Long-Term Orientation ... 97

4.4.4.8 Indulgence ... 98

4.4.4.9 Intention to Use ... 98

CHAPTER 5 – CONCLUSIONS AND RECOMENDATIONS... 100

5.1 Conclusions ... 101

5.2 Recommendations ... 102

GLOSSARY ... 103

REFERENCES ... 104

APPENDIX 1 (Pre-Test Questionnaire) ... 113

APPENDIX 2 (Post-Test Questionnaire) ... 123

APPENDIX 3 (Frequency Table) ... 133

CURRICULUM VITAE ... 142