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Literature review on service quality and customer satisfaction

Added on - 21 Jan 2022

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Table of Contents
ABSTRACT..........................................................................................................................................1
ACKNOWLEDGEMENT.......................................................................................................................2
CHAPTER 1: INTRODUCTION.............................................................................................................3
1.1The rationale of the research:..............................................................................................3
1.2Research objectives:...............................................................................................................4
1.3The scope of the study:..........................................................................................................5
1.4The methodology of the study:..............................................................................................5
1.5Ethics in research:...................................................................................................................6
1.6The structure of the thesis:....................................................................................................6
CHAPTER 2:LITERATURE REVIEW ONSERVICE QUALITY AND CUSTOMER SATISFACTION................7
2.1Customer satisfaction:.....................................................................................................7
2.1.1 Definitions:.......................................................................................................................7
2.2Concepts of service quality:.............................................................................................9
2.2.1 Definitions:.......................................................................................................................9
2.2.2 Theoretical models.........................................................................................................12
2.3Prior studies on the relationshipamong service quality, customer satisfaction and
customer loyalty:........................................................................................................................23
2.4Conclusion:......................................................................................................................28
CHAPTER 3: RESEACH METHODOLOGY...........................................................................................28
3.1 Research approach:..............................................................................................................28
3.2Research method..................................................................................................................29
3.2.1 Quantitative research method......................................................................................29
3.2.2 Qualitative research method.........................................................................................29
3.3Research design....................................................................................................................30
3.3.1 The procedure of the research:......................................................................................30
3.3.2 Preparing the questionnaire:.........................................................................................31
3.3.3 Official research model..................................................................................................31
3.3.4 Data collection...............................................................................................................32
CHAPTER 4: DATA ANALYSIS AND RESEARCH FINDINGS.................................................................33
4.1Data analysis:........................................................................................................................33
4.1.1Scale Test on each variable.....................................................................................33
4.1.2 Exploratory Factor Analysis...........................................................................................38
4.2Research findings..................................................................................................................40
4.2.1 Confirmatory factor Analysis:........................................................................................40
4.2.2 Structural Equation Modelling (SEM)............................................................................41
4.2.3 Findings of the research: Regression Weights..............................................................43
CHAPTER 5: DISCUSSIONS AND RECOMMENDATIONS....................................................................46
5.1Discussions:...........................................................................................................................46
5.2 Recommendations:...............................................................................................................47
APPENDIX........................................................................................................................................50
REFERENCES....................................................................................................................................56
ABSTRACT
The study is executed with the aim of finding out factors affecting customer
satisfaction with the E – commerce websiteFado.vnin Vietnam. The data is
collected from 248 people. After the data collection step, a process of four steps:
Scale test, Exploratory Factor Analysis (EFA), Confirmatory Factor Analysis (CFA) and
Structural Equation Modelling (SEM) is undertaken. The study’s final result showed
that all five independent variables including Tangibility, Assurance, Empathy,
Responsiveness and Reliability have a positive correlation with Customer
satisfaction.
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ACKNOWLEDGEMENT
This research may probably marks an end to my four – year course at Foreign Trade
University. If things go right, I can receive a Business Administration bachelor’s
degree after submitting this thesis.
I want to send my most sincere thank and highest gratitude to Dr. Cao Dinh Kien -
Vice Dean of Faculty of Business Administration, Foreign Trade University, for
providing me with plenty of invaluable instructions to help me complete this
graduation thesis successfully. Other honorable mentions are made to Mrs. Nguyen
Thuy Anh in particular, and all the other lecturers of the Faculty of Business
Administration, Foreign Trade University in general for supporting me a lot to finish
this thesis.
Sincerely,
Le Nhat Duy
May, 2019
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CHAPTER 1: INTRODUCTION
1.1The rationale of the research:
The 21stcentury isdefinitely thecentury of Internet. In 2017, for the very first time,
more than half of the world’s population (51.7%) have used the internet on their
devices and by the end of March 2019, it is estimated that more than 4.3 billion
people all around the world have had access to the internet. Internet’s growth is
inevitable due to plenty of different great benefits for mankind, one of which isE-
commerce.
E-commerceis the activity of buying or selling ofproductson online services or over
theInternet. Electronic commerce draws on technologies such asmobile
commerce,electronic funds transfer,supply chain management,Internet
marketing,online transaction processing,electronic data
interchange(EDI),inventory management systems, and automateddata collection
systems.
Modern electronic commerce typically uses theWorld Wide Webfor at least one
part of the transaction's life cycle although it may also use other technologies such
ase-mail. Typical e-commerce transactions include the purchase of online books
(such asAmazon) and music purchases (music downloadin the form ofdigital
distributionsuch asiTunes Store), and to a less extent, customized/personalized
onlineliquor storeinventoryservices.There are three areas of e-commerce: online
retailing, electric markets, and online auctions. E-commerce is supported
byelectronic business.
E-commerce businesses may also employ some or all of the followings:
Online shoppingforretail sales directto consumers viaWeb sitesandmobile
apps, andconversational commercevialive chat,chatbots, andvoice assistants.
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Providing or participating inonline marketplaces, which process third-party
business-to-consumer or consumer-to-consumer sales
Business-to-businessbuying and selling;
Gathering and using demographic data through web contacts and social
media
Business-to-business (B2B)electronic data interchange
Marketing to prospective and established customers by e-mail or fax (for
example, withnewsletters)
Engaging inpretailfor launching new products and services
Online financial exchanges for currency exchanges or trading purposes.
E-Commerce websites are websites through whichconsumers can watch, gather
information and make purchasing decisions.Ever since the introduction of e-
commercein the 1990s thanks to the World Wide Web(WWW), online trading has
taken the world bystorm. During their business implementation, E-commerce
website owners realize that they have to cope withmanymoreissues than they
originally thought they would,which results in some awkward efforts to solve such
problems.Among theaforementioned issues, perhaps the most serious one is the
challenge ofensuring customer’s satisfaction and developing customers’ trust of e-
commerce services. In fact, plenty of previous researches have showed that many
e-retailers struggle tokeep customers loyal to their services, whichresults from the
fact that they have not thoroughly understood their customers’ insight, including
what they want, what they need and what they are willing to pay.
Being aware of this challenge that many e-retailers, along withthe fact thatI intend
toopen my own online businessin the future, I have decided to conduct the
following study,whose name is“Factors affecting customerssatisfactionof E-
commerce websites”.This study will aim atcollecting, analyzing, discussing data
andproviding possible recommendations based on the research’s result.
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1.2Research objectives:
This research is conducted with the aim of obtaining the following objectives:
First,itsystemizesthetheoreticalbasis aboutcustomers’ satisfaction.
Secondly, itexaminesthe factors effecting customers’ satisfaction of e-commerce
websites.
Thirdly, itprovides some recommendations for individual or institutional e-retailers
to increase customers’ satisfaction, thus helpingto improvetheir overall business
performance.
1.3The scope of the study:
The study investigatesfactors’ effecting customer satisfactionwith E – commerce
website:Fado.vn. The survey is conducted inHanoi from 15thMay to 22ndMay,
2019.
1.4The methodology of the study:
Usingdeductive research approach, the research receives scholars’ theoretical
frameworkasafoundationandbasedonwhich,conceptualframeworkis
formulated. All hypotheses that forms conceptual framework are then tested to
confirm causal relationship between variables.
Causal relationship research is to be based on primary data to analyze determinants
contributingtoorinfluencedcustomersatisfaction.Theresearchutilized
quantitative data analysis, in which Cronbach’s Alpha will be deployed to analyze
the reliability of unidimensional scale, EFA to explore factors, CFA to confirm factors
and structural equation modelling (SEM) to clarify relationship between latent
variables and observed variables.
The software programs employed are IBM SPSS and IBM AMOS. IBM SPSS provides
Scale Test to understand internal consistency, and Exploratory Factor Analysis to
reduce dimensions and comprehend patterns of factors. Likewise, IBM AMOS offers
Confirmatory Factor Analysis to test the Goodness of Fit of measurement models
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