Customer Satisfaction and Loyalty in Retail

This assignment focuses on understanding customer satisfaction and loyalty in retail environments. It analyzes several research articles that explore the relationship between service quality, customer perceived value, satisfaction, and loyalty. The papers delve into various retail contexts like shopping malls, supermarkets, and hospitality enterprises, highlighting the importance of delivering excellent customer experiences to drive business success.

Running head: APPPLIED BUSINESS RESEARCH
Applied Business Research
Name of the Student
Name of the University
Author Note

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Table of Contents
Introduction......................................................................................................................................2
Literature Review............................................................................................................................3
The Concept Related to Customer Satisfaction...........................................................................3
Customer satisfaction in supermarket Retail Industry.................................................................5
Conclusion.......................................................................................................................................7
Reference.........................................................................................................................................9

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Introduction
The chosen business organization for the current study is Countdown supermarket chain,
which is one of the largest retail units operating in New Zealand. The business firm is one of the
subsidiary units of the Woolworths Limited, which is the largest retail supermarket chain of
Australia. Countdown has the largest number of retail stores in all over New Zealand with a total
number of 275 franchise shops. The company was established in the year 1981 and is currently
having its headquarters in Auckland. The owner ship of the company is with the group of
Progressive Enterprise. However, in the initial stage the ownership was under Rattrays
Wholesale Group. The ownership shifted to Progressive Enterprise in the year 2002, which
occurred after the group decided to buy the Woolworths Limited enterprise (Countdown, 2017).
Hence, it is evident that the Countdown has undergone several organization changes from
1993-2005. This had great impact of the organizational decision making process and upon the
quality of service and products that are sold the company. The company has been able to build
their reputation in the consumer market of New Zealand due to the effective and quality level of
customer service. This has allowed the company to build high level of brand reputation over the
years, as the customers are able to have high level of trust over the service and the products. The
company has also been able to gain high level of competitive advantage with the help of the
better level of customer service.
In the recent times however, due to the poor quality of customer service, it is not possible
for the company to maintain high level of customer satisfaction, thereby compromising on the
level of brand reputation and brand popularity of the company. The aim and scope of the current
study is to discuss about the existing literature that is related to various parameters that can

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ultimately affect level of customer satisfaction. It is important for a business organization to
focus upon these factors as it can help in improving upon the brand popularity of a company. The
scope of the existing literature is to discuss about the expectation level of the customers, which is
believe to be the primary factors for implementing high level of customer satisfaction. It is also
important to understand about the fact that in the recent days the customers have the option to
switch over different brands if they are not satisfied with the quality of service and products. In
this context, the scope of the current study will include about the matters related to that of
competitive environment that has huge influence over the matters related to that of customer
satisfaction. The study will also discuss about the factors that are related to high level of
customer satisfaction in the supermarket retail industry of New Zealand.
Literature Review
The Concept Related to Customer Satisfaction
The concept of customer satisfaction is one of the basic elements of marketing plan.
Satisfaction is believed to be one of the major outcomes of the marketing activity and is believed
to serve a link between culminating purchase and consumption. This is also believed to be one of
the major factors that decide upon the customer buying behaviour. As a customer chooses a
brand and decides to stick with the same for longer period, it gives rise to the concept of brand
loyalty. This concept is important due to the fact that can help a company to maintain brand
reputation. As said by Haumann et al., (2014), the concept of brand loyalty is entirely dependent
upon the satisfaction level of the customer. Hence it is essential for all business organisations to
satisfy the needs of the customers, which can be achieved by considering several factors of
business.

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Rogers et al., (2015), have mentioned that customer satisfaction can also help to measure
and monitor the quality of product or service that is sold in market. It can also help to measure
the extent to which company has been able to fulfil the expectation level of the customer. Chen
et al., (2015), have defined the concept of customer satisfaction as a shared process of
understanding the nature of service or product that is available in the market. It can also help to
understand the level information that is being provided to the customers about the ultimate
experience of the service or product. On the other hand Pizam et al., (2016), have suggested that
customer satisfaction can be achieved by enhancing the feeling that are experienced by an
individual after using a product or service. The consumer’s perception is also one of the
important aspects of customer satisfaction, which helps to fulfil all the concerned related to the
quality of the product.
Bansal, and Taylor (2015), have mentioned about the concept of desired and adequate
level of service, which is believed to be one of the primary essential for understanding the level
of customer satisfaction. It can be said that if the desired an adequate level of the product quality
are not fulfilled, it is never possible to achieve high level of customer satisfaction.
Dominici and Palumbo (2013), have added about the various levels that are involved in
achieving customer satisfaction. The primary level there is negative disconfirmation, where the
quality of the service ends up being much worse than expected level of customer. In the
following step is a positive confirmation, where company is able to better the quality of service
buy meeting up with the minimum level of customer’s expectation. In the later stages, it is
possible for the company to go beyond the level of customer satisfaction by bringing about new
changes in the protocol of customer service. This type is essential in maintaining sustainability in
business and ensuring that the company is able to retain old customers.

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Customer satisfaction in supermarket Retail Industry
With the growing competition in the supermarket Retail Industry of New Zealand, the
customer satisfaction level is one of the primary essential concerns that can help the companies
to achieve competitive advantage. For large-scale Supermarket Giants like Countdown, it is
highly essential to bring about changes in the quality of customer service, as they are always
encountering the threat of new competitors, who are incorporating innovative ideas in providing
efficient and high quality of customer service. Saeidi et al., (2015), have highlighted up on the
importance of getting feedback from the customer, which can help to bring about necessary
changes for large scale business organisations. It is often highly challenge for large scale
supermarket retail stores to investigate upon the primary needs of the customers. This is mainly
due to the fact that need and expectation level of the customers vary hugely in different places.
For example, the need of the customer in Rotorua from Countdown store may be different from
that of Auckland. Hence, it is necessary to provide customer satisfaction at different level
depending upon the needs of the local customers.
In the middle of tough and fiery competition in the grocery retail sector of New Zealand,
it is important to provide wide range of options for the customers. This is believed to be one of
the effective ways that can help large scale industries to retain the old customers. Yadav et al.,
(2014), have mentioned about the importance of implementing digital form of marketing, which
can help the large scale Supermarket companies to easily communicate with the customers. This
is also believed to be one of the effective ways to maintain high level of customer satisfaction as

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the company are able to collect direct feedback. The major level of expectation of the customers
is primarily to get fast and accurate service. Hence, it is highly necessary to resolve all the issues
that are encountered by the customers while purchasing products. It is important to mention that
better level of after sale service is also believed to be one of the key to retain customers.
Due to tremendous growth in the service of Retail Industry, it is highly challenging for
the supermarket chains like Countdown in Rotorua to enhance the rate of productivity that is
necessary to meet up with the growing demand of the customers. Oreland Kara (2014), have
suggested that understanding and giving priority to the needs of every group of customers at
primary level can easily help the supermarket franchise to deal with the complex level of
challenges that they face while retaining customers. Kursunluoglu (2014), has also mentioned the
importance of digital form of communication, which is Highly Effective in the modern days to
establish effective business relationship with the customers.
It is essential for the marketing agents of the Countdown Supermarket to identify the root
cause of all the service related issues. This can be achieved with the help of extensive level of
market investigation that focuses upon the recent crisis and economic loss. Jahanshani et al.,
(2014), have mentioned about the importance of implementing the tool of Porter's five forces,
which can help to understand methods that exist in external business environment and has the
potential to disrupt the level of customer satisfaction. It is important to mention in this context
that with the growing number of organisations in the grocery and retail sector, the customers
have the choice to switch over to other brands if the encounter any issues with the level and
quality of customer service. The maintenance of brand loyalty is believed to be one of the
primary essential needs for maintaining high level of customer satisfaction, thereby ensuring
about the fact of customer retention.

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It is also important for the Countdown supermarket retail unit to regularly monitor the
level of their customer service, which is an important part of market investigation. Holistic mode
of evaluation is believed to be highly essential that help them to identify the gaps in the existing
customer service, which are causing them to lose customers. As mentioned earlier, digital mode
of communication can be useful in collecting feedback from the customers. These feedbacks are
the primary information that is necessary in market investigation work related to customer
satisfaction (Paparoidamis et al., 2015).
It is ultimately important to consider the parameter of customer satisfaction as the
primary goal of all business and marketing strategies. Only with the help of high level of
customer satisfaction, it is possible for Countdown to achieve their organisational objectives and
improve upon the total revenue of the company. As the popularity of the brand will be raised
through high level of customer satisfaction, it will be possible for the company to sustain for
longer periods in the fast growing changes of the current age.
Research Questions
 What is the importance of maintaining high level of customer service for Countdown
Supermarket?
 What are the factors that need to be considered by the Countdown Supermarket for
improving the level of customer satisfaction?

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Conclusion
From the section of literature review it is clear that customer satisfaction is one of the
essential goals of all business and marketing strategies. For Large scale Supermarket retail units,
it is highly important to maintain high level of customer satisfaction. This can help them to retain
customers thereby helping them to achieve competitive edge in the tough and fast changing
sector of retail units. At initial stage, it is important for the companies to understand the concept
and underlying cause for customer satisfaction. Having a clear concept of customer satisfaction,
it is possible for the companies to implement upon different strategies in customer service and
understanding the relationship between brand loyalty and customer satisfaction.
From the review section it is also clear that the fast growing network of Supermarket
grocery chain in New Zealand is one of the primary challenges that barrier to understand the
expectation level of customer. Implementation of digital form of business communication is
believed to be one of the primary goals of that can help the companies to collect feedbacks from
the customers. With the help of the information from the customer’s feedbacks, it is possible for
business to bring about changes in the quality and features that are associated with the customer
service. This will ultimately help in the market investigation work that is necessary to maintain
and retain customers.

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Reference
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food safety management schemes in New Zealand: A survey of the food and beverage
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comparative analysis of the effectiveness of customer satisfaction and customer–
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