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Impact of digital marketing on consumer purchase behaviour; A case study on Dialog Axiata with specific reference to social media marketing.

APIIT Business, Law & Technology Conference, 2018
July 19th, 2018 | Colombo, Sri Lanka
Impact of digital marketing on consumer
purchase behaviour
A case study on Dialog Axiata with specific reference to social media marketing.
Naseeth Ahamed Nizar
School of business
BMS (Business management school)
Colombo 06, Sri Lanka
Chrishankar Janathanan
Dept. of Management,
BMS (Business management school)
Colombo 06, Sri Lanka
Title: Impact of digital marketing on consumer
purchase behaviour: A case study on Dialog Axiata
with specific reference to social media marketing.
Purpose – The purpose of this research is to identify
how the social media marketing impact on the
consumer purchase decision. The objective of this
research is that to define the term social media
marketing and consumer purchase behaviour, to
carry out a literature review on the subject of
consumer purchase behaviour and impact of social
media, to conduct a primary research with the help of
questionnaires and interviews on the impact of social
media advertising and consumer purchase behaviour,
and to review the findings and to make
recommendations to management of Dialog Axiata.
MethodologyThis research is based on survey
method, as the questionnaire was distributed to
gather data from the public for the research about
the impact of social media marketing on consumer
purchase behaviour. 184 responses were gathered
from the distribution of the google forms survey.
Likewise, the interview was conducted for further
finding to be evaluated. Interview was conducted
among three interviewees in Dialog Axiata. Further,
primary research also was conducted utilisation of
the journal articles from the previous researchers.
Moreover, the data for this research was analysed
through IBM SPSS statistics software.
Findings In this research Cronbach Alpha,
Regression for the independents variables,
Correlation for both dependent and independent and
descriptive statistics was found by using the SPSS
software for this research. The hypothesis that was
identified for this research were accepted. Likewise,
there was a significant positive correlation identified
in this research which help the study to prove its
overall value.
Value - This research helps to overcome the issues
encounter in the based articles. Also, this research
develops a much functional and less complexed
process to develop social media marketing in order
to predict the consumer purchase behaviour.
Keywords: digital marketing, consumer purchase
behaviour, Social media marketing
1.0 Introduction
1.1 Project rational and significance
In digital marketing, understanding
consumer behaviour is key for marketing success as
consumers have embraced utilising the internet and
online socialising tools (Vinerean, Cetina,
Dumitrescu, and Tichindelean, 2013). Consumer
purchase behaviour is influenced by having the
knowledge and being brand oriented. Also, brand
awareness is coupled with good brand perception and
loyalty result with a stronger brand image in
consumer’s mind, which will influence the
consumers positively and becomes part of their
purchase behaviour (Malik et al., 2013). Consumer
purchase behaviour is how individuals, organisations,
and groups select, buy and make use of product,
service, experience or ideas to satisfy their needs and
wants (Rasool Madni, 2014).
1.1.1 Project significance
This research is significant for a number of
stakeholders and parties who are involved in the
research process.
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Management - Management in the dialog have been
endlessly pushing their customers to adopt
technologies which will help to save up on cost and
successfully allow the customers to develop and
adopt operative methods of business management
and marketing.
Consumer associations - Consumer associations
have been unconvinced of the use of social media and
online features which have often misguided the users.
This research will clear the air, on understanding the
benefits, drawbacks, and enablers.
Regulators – It considers the use of social media and
online purchasing to be indicators of progressive
economies. As such, this does deliver the regulators
with an effective model for the transaction.
1.2 Company background
Dialog Axiata is one of the largest
telecommunication providers in Sri Lanka. In terms
of market capitalisation, it is listed as one the largest
company in Colombo Stock Exchange. Similarly, it is
also Sri Lanka's largest foreign direct investor with
investment totalling above USD 2.1Bn. Dialog, a
winner of six GSMA Mobile World Awards has the
distinction of being voted by Sri Lankan consumers
as the Telecom Service Provider of the Year for six
successive years and Internet Service Provider of the
Year at the SLIM Nielsen People's Choice Awards.
The company provides 2.5G and 3/3.5G Mobile as
well as 4G Communications networks supporting the
very latest in multimedia and mobile Internet services
(Dialog, 2016)
1.3 Current situation of the company
Recently dialog faced a network error which
caused them a big lost in their business. When the
error took place, the competitors have tended to
increase their market strategy which will tend to
decrease the market for dialog. Also, the competitor
Etisalat, Airtel and other competitors did more
marketing to gain more consumers.
Dialog Axiata announced that network error
was caused due to the service was fully restored in
less than 60minutes. Dialog stated that they regret the
inconvenience to customers arising from network
disturbances that took place. The Disturbance to
voice and SMS services occurred due to a power
systems failure at one of the key network nodes,
which resulted in congestion in other parts of the
network. Services were fully restored in less than an
hour. Dialog networks throughout the country
experienced a wide-ranging network failure due to
this problem (Daily mirror, 2017). Therefore, as a
token of gratitude dialog waived the charges for calls
and SMS along with the taxes fully and refunded as
top-up within a day.
1.4 Research aims and objective
The aim of this research is to analyse and
identify the impacts of social media marketing on
consumer purchase decision and also how social
media marketing help consumer in a purchase
Research objectives:
To define the term social media marketing
and consumer purchase behaviour.
To carry out a literature review on the
subject of consumer purchase behaviour and
impact of social media.
To conduct a primary research with the help
of questionnaires and interviews on the
impact of social media advertising and
consumer purchase behaviour.
To review the findings and to make
recommendations to management of Dialog
1.5 Research problems and questions
According to the theme that is chosen where
the discussion emerges on the impact of social media
marketing on consumer purchase behaviour. The
primary question here is does social media marketing
impacts on consumer purchase behaviour in the
current technologically advanced world.
1.5.1 Research questions
1. What defines social media marketing and
why do organisation use social media
2. Does social media marketing help the
consumers to choose the right product and
how it impacts on consumer purchase
3. Which is the best place to market on social
media by the organisation to gain more
4. Is it effective and efficient to use social
media marketing?
2.0 Initial Literature Review
Social media marketing is a part of digital
media marketing which can also be define as a
marketing of goods and services. As we can see in the
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recent years, the popularity of social networking sites
and social media has increased at a global level
(Kucuk and Krishnamurthy, 2007). For example,
Facebook is said to have more than a billion users
from the time it began in 2004. Social networks are
increasingly taking up a greater share of consumer
time spent online. Users are also using different
online formats to communicate, such as Blogs,
YouTube, Myspace, Instagram and Facebook to share
information about the product or service and also to
contact the other consumers who are also seen as a
more objective information source (Kozinet, 2002).
The unique aspect of social media and it immense
have revolutionized marketing practices such as
advertising and promotion (Hanna, Rohm and
Crittenden, 2011). Likewise, Kaplan and haenlein
(2010) state that, there are many advantages of using
social media marketing, it helps to connect business
to consumers, develop relationships, and foster those
relationship in a timely manner and at a low cost.
Social media websites gives an opportunity to the
organisations to connect and interface with potential
and current consumers, which will help to have a
strong customer relationship and also to build all-
important meaningful relationships with consumers
(Mersey, Malthouse and Calder, 2010), particularly in
the present business condition when consumer
loyalty can vanish at the smallest mistake, which can
moreover have on the online propagation of their
unfortunate encounter with a particular product,
service, brand or company.
Consumer purchase behaviour
Consumers have a tendency to take part in
relational behaviours to accomplish more efficiency
in their decision-making, to reduce information
processing, to achieve more cognitive consistency in
their decisions, and to reduce the perceived risks
associated with future choice (Sheth and Parvatiyar,
1995). A consumer begins to feel safe with the
service provider or supplier when transactions are
done successful (Ravald and Gro¨nroos, 1996). When
consumer trust the company, they realize that this
organization can satisfy their requirements and needs
and in the long run, they become committed to the
company. Consumer online purchase decisions have
mainly focused on identifying the factors that affect
the willingness of consumers to engage in internet
In the space of consumer behaviour research
here are general models of purchasing behaviour that
delineate the procedure which consumers use in
making a purchase decision. The online shopping
environment empowers consumers to reduce their
decision-making efforts by giving huge selection,
information screening, dependability, and product
comparison (Alba et al., 1997). Since the Web gives
screened and examination data for options,
consumers may likely to reduce the cost of
information on search and the effort in making
purchasing decisions.
2.1 Cost efficiency
Individuals argue that price will also play an
even lesser role on the internet, given the opportunity
for more nonprice data to be delivered. According to
this argument regarding the price, attribute is being
so visible and dominant, the option position, with the
absence of imperative on the amount of information,
is that consumer can spend more time going through
it and evaluating nonprice attribute information
(Lynch and Ariely 2000). Moreover, Brynjolfsson
and Smith (1999) state that in online purchasing
lower prices are being charged than in traditional
outlets. Also, wider prices are being charged for the
same product than in traditional retailing. They
estimated this may be the consequence of more
differences in non-price attributes and services; thus,
cost plays a less essential part in the consumer choice
Furthermore, when we attempt to deal with
the different expectations, the part of the cost in the
digital consumer's choice process is not clear. The
consumer in the digital market will have more
information about the products and services and that
the ease of search is higher: as a result, when
consumer making their product choice they will be
fully informed or will be having more opportunity to
be more fully informed. It is also important that
research also need to apply for a consumer choosing
across brands. Brynjolfsson and Smith’s (1999)
research seems to be more specific, which is more
focused on the role of price when deciding to shop
online for a particular product. The hypothesis for
the following would be:
H1a: Cost-efficient has impact on consumer purchase
2.2 Information satisfaction
Information satisfaction refers to consumer
satisfaction and dis satisfaction with an overall
information that is provided for the goods and
services (Crosby and Stephens, 1987). Which implies
exploring through Web pages and contents in an
online service context. It varies from the overall
satisfaction which refers to consumer’s overall
evaluation of an organization based on all encounters
and experience with that specific organisation (Jones
and Suh, 2000). According to the information system
literature, user information satisfaction can be
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affected by information quality and user interface
quality (DeLone and McLean, 1992). Information
that is provided by the online store needs to support
the customer service and product. These information
needs to be helpful and relevant in predicting the
quality and utility of a product or service
(Wolfinbarger and Gilly, 2001). In order to satisfy
consumer’s information needs, such information
needs to be up-to-date when offering products and
service, it should also be sufficient in order to help
the consumer when making a choice, consistent in
representing and formatting the content and also
make it easier to understand (Wang and Strong,
1996). Therefore, we can say that information
satisfaction will have an impact on consumer
purchase behaviour.
The hypothesis for the following would be:
H2a: Information satisfaction has an impact on
consumer purchase behaviour.
2.3 Consumer Trust
Some authors are in progress to examine the
influence of consumer trust in online marketing, due
to the lack of trust among online consumers, it is
considered as the main explanation for low electronic
commerce rates. When a consumer does a transaction
with an online web store that is portrayed to be
operating in an uncertain environment (Fung and
Lee, 1999) like the internet, Consumer is less
prospective to assume that everything about their
transaction is guaranteed and usual as associated to
their transactions with an offline store. It clearly
shows that the consumers have no any physical
interaction with the seller in online transactions. Due
to this, it is unable to evaluate effectively the
products which are on offer or to check the identity of
the seller. Moreover, it is also possible that
conceivable that the item received is not the one that
was ordered. In addition, the increasing problem with
spam, the continuous periodic reports on hacker
attacks and viruses and the existence of a legal
framework that is incomplete, heterogeneous and
ineffective (Koufaris and Hampton-Sousa, 2002). In
fact, online shopping is seen as being more dangerous
operations (Taylor Nelson Sofres Interactive, 2002)
also developing trust by using the internet is more
difficult than in traditional channels (Bitting and
Ghorbani, 2004). Therefore, we can say that
consumer trust will have an impact on consumer
purchase behaviour.
The hypothesis for the following would be:
H3a: Consumer trust has an impact on consumer
purchase behaviour.
2.4Internet shopping experience
Consumers with greater Internet experience
will probably utilize on the web channels to gather
item data because the cost of collecting information
is less costly than that from offline channels (Cook
and Coupey 1998). Consumers who have a greater
internet experience is likely to the various perception
of the attribute of the online channels from that of an
internet beginner and also the consumer will have a
higher confidence on the internet (Bart et al. 2005).
For an Internet beginner, in contrast, utilizing the
online information may evoke perceptions of
uncertainty and complexity. Therefore, Internet
experience may moderate the assessment of online
information. Hence, consumers with more internet
shopping experience will be using the internet as
their primary information source and also more likely
to have a greater confidence on the internet.
Furthermore, they are also more likely influenced by
the online reviews. Therefore, we can say that
internet shopping experience will have an impact on
consumer purchase behaviour.
The hypothesis for the following would be:
H4a: Internet shopping experience has an impact on
consumer purchase behaviour.
3.0 Methodology
3.1 Introduction to research methodology
Research is defined as a systematic and
scientific which helps in data collection compilation,
analysis, interpretation, and implication pertaining to
any business problems. Likewise, Research
methodology is the systematic, theoretical analysis of
the techniques which is also applied in the field of
study. In addition, the methodology also involves a
method of describing, explaining and forecasting
phenomena which will help to solve the upcoming
and current problems. By doing this research it does
not provide solutions for the problems but it does
offer a theoretical foundation for understanding
which method of procedure, set of procedure which
can be applied to a specific case. Research
methodology also contains concepts such as research
designs, target population, sample size and sampling
procedure, data collection instruments and data
analysis procedure (Kothari, 2014).
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3.2Conceptual framework
The purpose of the conceptual framework in
research is that which will identify and outline the
possible course of action and also present a preferred
approach to an idea or thought. Jabareen (2009),
states that conceptual frameworks are the products
which is a qualitative process of theorization. Which
will also explore the process of building conceptual
Independent variables Dependent variable
Cost efficient
Consumer purchase
Information satisfaction
Consumer trust
Internet shopping
3.3 Research onion
Research onion use to illustrate the stages
that need to be covered when developing a research
strategy. It also provides an effective advancement by
which a research methodology can be well designed.
The five important layers are research philosophy,
research approach, research strategy, and time
horizon and data collection. This will help to design
the research methodology effectively and efficiently
(Saunder, Lewis and Thornhill, 2007).
The researcher has chosen a positivism
research philosophy. The positivism depends on
quantifiable observation which will lead to a
statistical analysis. Likewise, positivism is in
accordance with empiricist view that learning
originates from human experience. Laroche, Habibi
and Richard (2012) also have stated that quantitative
methods which are the questionnaire and hypothesis
have been used in their research, therefore it is
justified that positivism can be used by the
researcher. Jankowicz, (2005), states that they have
used positivism in their research because this method
helps the researcher to find the truths of the
observation by using hypothesis deductive methods.
As the positivism relies on the quantitative data
collection method which the author believes is more
reliable than qualitative research. Likewise, the
quantitative research is more trustworthy as it is
collects the data that is needed for the specifically
wanted for the research. Also, the when the research
undertakes positivism research it is more structured
during the studies and discussion.
According to this research project, the
researcher has used deductive approach. The
deductive approach will also contain qualitative
research and quantitative research. Reyes, (2004)
states that deductive is fully based on testing
hypothesis and the negative side of this is that it
would not encourage contrast thinking and also limits
the creativeness. Another journal also stated that in
order to get the answer for the project, the
questionnaire was done by the researcher. Also, the
conceptual framework and its relationship have been
explained by the hypothesis. Likewise, when the
research uses deductive research it clearly defines the
both dependent and independent variables. Thus, the
relationship between the concept and variables can be
found therefore, the hypothesis of each variable can
would be accepted (Taher et al, 2015). Further, with
the use of deductive research the risk that is occurred
in the research can be avoided as the deductive
research clearly test on the hypothesis.
In this research project, the researcher has
undertaken survey strategy. By using survey strategy,
it will help the researcher to obtain information about
practices, circumstances or perspectives at one point
in time through questionnaires and interviews. In
addition, the use of survey strategy will help the
researcher to study more variables at one time than is
normally conceivable in field experiments and while
data can be gathered about real-world environments.
This survey needs to be sent through the link, the
information gathered from this strategy will not be
accurate and honest as there is no seriousness
(Fowler, 2009). Ahmad, Ahmed, Rizwan and Haq
(2014), justifies that they have used surveying and
case study for their research strategy in a research
project. Lodhi and Shoaib (2017) state that the data is
gathered through the Google form questionnaire in
order to collect data for the survey in their research
project. As this research is survey based the
questionnaire needs to be distributed within the
Colombo districted. Questionnaire can be developed
by using Google form and 384 responses needs to
collected and before launching the questionnaire the
pilot testing needs to be done among 20 respondents
in order to identify that questions are clear and
understandable for the responses. Survey is data
collection with less costly and less time consuming.
Further, it is capable to collect large number of
The cross-sectional will be utilized over the
research period of time. The benefit of using cross-
sectional design is that it allows the researcher to
compare different variables at the same time. Ahmad,
Ahmed, Rizwan and Haq (2014), has used cross
sectional in their research which is similar to the
author’s research. Likewise, in this research also the
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author has used cross sectional method in order to
conduct the research further, whereas the research
will be completed within a year in a broader topic.
Time period to complete the research is within a year
therefore, the cross-sectional method will help the
author to accomplish the objectives of the research
and complete the research within the specific
deadline that is given. Cross sectional is less costly to
perform and does not require more time in pursuing.
Furthermore, in cross sectional method multiple
variables can be used at the same time.
Likewise, in this research project all kind of
data collection method is used in order to gather
information and data. The main data sources result
from the primary and secondary research. As a
primary research for this project will be carried by
using questionnaire, interviews, and sampling.
Moreover, as secondary research data and
information will be collected from internet, books,
journal articles, and observation. The research results
will be taken based on 384 questionnaires and 05
interviews will be taken as the primary data
collection. Balakrishnan, Dahnil and Yi, (2014)
justifies that observation and secondary data methods
can also be used to gather the information through
secondary data and then to analyse the results gained.
Interviews also can be used as it is a clear way of
communicating between two parties. Taher et al
(2015) also states that they have used sampling and
structured questionnaire in order to get the feedback
from the respondents, therefore, it is justified that
sampling and questionnaires can also be used in this
research. Questionnaire for this research needs to
done using the Google form software and distributed
among Colombo. The secondary data is time saving
and helps to make the primary research data
collection more specific with the help of data
gathered from the secondary data. Through, certified
sampling method it is chosen that BMS as the
population, and 384 as the sample size through
analysing Morgan table.
4.0 Finding and analysis
Findings and analysis provides a
comprehensive analysis from the data gathered. A
total of 184 questionnaire responses has been
gathered for this research by using google forms.
Also, IBM statistical package for social science
(SPSS) has been used to comprehensive analyses the
data that has been gathered. The analysis that is done
for the comprehensive outlook is divided into
separate segments. Firstly, the author will evaluate on
the sample profile, validity, reliability analysis by
using Cronbach alpha statistic, test for normality,
linearity, correlation and regression will be carried
out. Then a deep discussion will be analysed on the
data collection on the research. A hypothesis test is
set about as part of study.
In order to measure the reliability in this
research Cronbach Alpha test has been used. By
using Cronbach alpha, it dominant measures of how
reliable the data is within the statistic test. A construct
or variable is reliable if the Cronbach Alpha is more
than 0.6 (Bryman and Bell, 2007). The Cronbach’s
Alpha in this research is .961 which is greater than
0.6, therefore this shows that these variables are
reliable for the research work.
Reliability Statistics
Cronbach's Alpha N of Items
.961 4
Pearson correlation indicates the relationship
between two variables. It shows the quality of
connections and the heading of the relationship that
will be taken. This shows that summary of the
correlation of both dependent and independent
variable. As the independent variable of cost efficient
is 0.868 which is similar to the result of Lynch and
Ariely (2000), information satisfaction 0.841 868
which is similar to the result of Crosby and Stephens
(1987), consumer trust is 0.878 which is similar to
the result of Bitting and Ghorbani (2004) and internet
shopping experience 0.875 which is similar to the
result of Bart et al. (2005).
Variables Pearson
ur and Indep_cost_efficient
ur and
ur and Indep_consumer_trust
ur and
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Model Summary
Adjusted R
Std. Error
of the
1 .920a.846 .843 .39896
a. Predictors: (Constant),
According to the table above it provides R
and R2 values. The R value represents the simple
correlation and which is 0.920 which also represented
a higher degree of correlation (The R column). The
R2 value which represents the consumer purchase
behaviour which can be explained by the independent
variables, cost efficient, information trust, consumer
trust and internet shopping experience are shown in
the R square column which can be predicted as
Model Sum of
df Mean
F Sig.
156.927 4 39.232 246.
28.491 179 .159
Total 185.418 183
a. Dependent Variable:
b. Predictors: (Constant),
The significance value which is indicated in
this is at .000 which is a good P value. This model
also shows a good significant between the model
The equation of the regression is:
Y= mx + C
Y = mx1 + mx2 + mx3 +mx4+ C
Y (Consumer purchase behaviour) = m (cost
efficient) + m (information satisfaction) + m
(consumer trust) + m (internet shopping experience)
+ c(-.74)
Likewise, it also interprets the objectives of
this research with use of quantitative methods.
Results that is gathered using the Google forms is
analysed and discussed in the following chapter. A
proper analysis simplifies a complication which is
associated with a last number of data collected in a
comprehensive manner such as image, rational to the
question and comparison of each variables are
considered in research (Silverman, 2013). Author has
mentioned the relation between the literatures with
the indicators of the questionnaire analysis at the end
of the research.
The purpose this chapter to evaluate the
independent variable questions: cost efficiency,
information satisfaction, consumer trust and internet
shopping experience, also the dependent variable
consumer purchase behaviour questions have been
evaluated. As the social media advertisement is
developing these days this research will review about
the social media marketing that is used by the Dialog
Axiata and how it impacts on the day to day
consumer purchase behaviour. Likewise, four
hypothesis have been identified in this research with
the utilisation of SPSS software and it will provided
to effectively drive a clear process. In order to under
each variable used in this research effectively SPSS
software has been used for clear understanding of
cost efficiency, information satisfaction, consumer
trust and internet shopping experience. And also, with
the use of SPSS the significant amount for each
variable is found which is most important in a
5.0 Conclusion and recommendation
Recommendations for Dialog is provided
based on the results that is gathered for this research.
As from the data collection which is analysed in the
previous chapter. The problem that is found from this
research for this Dialog Axiata are,
Risk 1 - 10.9% of the respondents have mentioned
that Dialog does not charge affordable prices for their
service that is provided for the customers.
Recommendation - Dodds et al. (1991) states that
consumer’s perception of value characterises a trade-
off between the quality and the benefits that they will
receive from the product relative to sacrifice they will
perceive in the paying the price for the good.
Likewise, the market perceived quality is adjusted by
the companies for relative product price (Gale, 1994).
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Therefore, Dialog has to provide the goods at the
affordable rate that consumer can purchase and also,
they have to check the competitors price and come up
with a pricing strategy in order for the consumer to
purchase their product at affordable rate.
Risk 2 - 9.3% of the respondents says that Dialog
does not provide a standard quality of services.
Recommendation - Customers satisfaction and dis
satisfaction about the product information and quality
is much important when consumer purchasing goods
and services. Information satisfaction can also affect
the quality of goods that is offered by Dialog
(DeLone and McLean, 1992). Wang, Lo and
Yang, (2004) also states that the impact of service
quality and consumer purchase behaviours on
behavioural aims of customers are joined and
analysed in an integrated framework. Therefore,
Dialog can improve their service quality of 4G
network in order to improve the quality of service
standard and also, they are about to launch the 5G
network, hence it will increase the quality of Dialog
Axiata and the consumer can use the service of
Dialog effectively and efficiently.
Risk 3 - 9.8% of the respondent’s states that there is
no impact of consumer purchase behaviour on online
Recommendation - The online shopping pages
engages customers to decrease their basic leadership
endeavours by giving immense choice, data
screening, steadfastness, and item examination (Alba
et al., 1997). Likewise, online shopping has more
dangerous operation when consumer buy goods from
online site and also companies developing trust by
online shopping is complicated than in normal outlets
(Bitting and Ghorbani, 2004). Therefore, Companies
needs to provide proper information and creates a
trust for the consumer that the page is originated by
the company and the transactions will be done much
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