2705. Service Performance Factors Affecting Customer Satisfaction: E-Grocery in. Jeddah, Saudi Arabia. Ahmad Hassan J Thabit. School of Computer Sciences, ...
International Journal of Applied Engineering Research ISSN 0973-4562 Volume 11, Number 4 (2016) pp2705-2710 © Research India Publications. http://www.ripublication.com
Service Performance Factors Affecting Customer Satisfaction: E-Grocery in Jeddah, Saudi Arabia Ahmad Hassan J Thabit School of Computer Sciences, Universiti Sains Malaysia (USM), 11800, Penang, Malaysia.
Ahmad Suhaimi Baharudin School of Computer Sciences, Universiti Sains Malaysia (USM), 11800, Penang, Malaysia.
Kamal Karkonasasi* School of Computer Sciences, Universiti Sains Malaysia (USM), 11800, Penang, Malaysia.
questions that are featured in the description of the company's background. The first question is, “What does e-grocery have to offer that traditional grocery outlets are not already providing?” The second question is, “Why would people change their grocery shopping habits?” Without a doubt, E-Grocery-KSA offers many benefits to customers, for example, it is a faster way to shop [1]; addresses the parking problems that customers face at traditional grocery stores; offers cheaper prices than those offered by traditional grocers [1]. In addition, the fresh goods at e-grocery shops have a higher quality than goods at traditional grocery stores. A research studies in Finland on the purchasing of tomatoes indicate that “each tomato is touched on average 11 times before it ends up in the home of the final customer, primarily because of the various stages in the supply chain and finally because of the people who want to squeeze tomatoes before buying them. With e-grocery, tomatoes are touched only three times before the final customer receives them” [2]. Moreover, it is more convenient for busy families, especially those with young children, and for people who do not have the time to wait in line as well [3]. The benefit of these time savings cannot be emphasised enough; saving time is a very important asset for potential customers of e-grocers over traditional grocers. According to research studies conducted in Finland, “Households visit shops on average 4.6 times a week, spending on average 48 minutes on weekdays and 58 minutes at weekends. A total of 57 percent of the time is spent in cars, and the rest is spent in shops, selecting and paying for the goods. This is approximately 200 hours per year, which means that households spend on average five full 40-hour working weeks annually doing their grocery shopping. In the case of combined trips the time spent on other shopping was eliminated, so the result is the actual extra time required for shopping for groceries” [2]. Theliterature review is provided in Section 2 and3. Proposed E-Grocery-KSA’s Model and research methodology is
Abstract The scope of this study includes customer satisfaction with traditional grocery and the intention to use the e-grocery store in the city of Jeddah, Saudi Arabia. The researchers conducted a study on e-grocery business in Jeddah City and obtained a sample of 400 participants. This survey-based study was based on the five service quality dimensions (i.e., tangibles, reliability, responsiveness, assurance and empathy) to test customer satisfaction with traditional grocery shopping in Jeddah City and the extent to which they would use e-grocery shopping if available. The result of the survey showed that tangibles, reliability and assurance are significant, while responsiveness and empathy are not significant. In addition, the result showed that 65.6% of participants in the survey agreed or strongly agreed that they would use e-grocery in Jeddah City in various parts of the city. Keywords: E-Grocery, Service quality dimensions, Tangibles, Reliability, Responsiveness, Assurance, Empathy
Introduction E-Grocery-KSA has been developed to exploit the business opportunity represented by e-grocery in Saudi Arabia called "E-Grocery-KSA". E-Grocery-KSA intends to introduce an egrocery business to the Kingdom of Saudi Arabia (K.S.A). EGrocery-KSA aims to become a preferred form of shopping for many people such as individuals with busy schedule, facing parking problems or preferred to order through the web. The company follows a business-to-consumer model (B2C). It will buy fresh food from suppliers and sell it to consumers who desire the service through a web. The company provides many practical conveniences for customers, such as enabling them to browse and select available products on the Internet, pay online with credit or debit cards and arrange for a company to deliver the products directly to customers. There are two important, basic
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International Journal of Applied Engineering Research ISSN 0973-4562 Volume 11, Number 4 (2016) pp2705-2710 © Research India Publications. http://www.ripublication.com presented in Section 3 and section 4. In Section 5, Data Analysis and Results are illustrated. Finally, the conclusion is brought in section 6.
defined as the caring, individualised attention a firm provides its customers [6]. Figure 1 illustrates the research design for this study, which was based on Parasuraman et al. [6]. Customer satisfaction
Literature Review This study focuses on customer satisfaction. Under this keyword, there are five previous studies that are noteworthy. These studies have discussed satisfaction in terms of what customers need and want. As a result, the definitions of customer satisfaction discussed in these studies will be presented as well as how real-life businesses satisfied users or customers. In addition, E-Grocery-KSA’s definition of customer satisfaction is presented as well as how the company will satisfy its customers. Service quality and customer satisfaction are closely related constructs [4], [5]. More specifically, this study focuses on (1) measuring employee expectations and perceptions of service quality based on the SERVQUAL model and (2) examining service quality dimensions in predicting satisfaction and loyalty. Parasuraman et al., [6] decreased the service quality dimensions from 10 categories, including (1) reliability, (2) responsiveness, (3) competence, (4) access, (5) courtesy, (6) communication, (7) credibility, (8) security, (9) understanding/knowing and (10) tangibles, to five dimensions. The first of these dimensions is tangibles, which refers to physical facilities, equipment and the appearance of personnel. Reliability can be defined as the ability to perform the promised service dependably and accurately. Responsiveness is defined as the willingness to help customers and provide prompt service. Assurance is defined as the knowledge and politeness of employees and their ability to inspire trust and confidence. Empathy is
Tangibles
Reliability
Responsiveness
Tangible
Empathy
Assurance
Reliability
Responsivenes s
Figure 1. Measuring Service Quality to Research Employee Perceptions (Source: Munhurrun, Naidoo & Bhiwajee, 2010)
According to Negi, 2009, Friday & Cotts, 1995[7], [8]; defined customer satisfaction into two ways. The first definition “is a result of a cognitive and effective evaluation, where some comparison standard is compared to the actually perceived performance”. The second definition is as “the customer’s needs are met, product and services are satisfactory, and the customer’s experience is positive” [7]. Negi’s [8] study based on the SERVQUAL model [6] with additional dimensions, including tangibles, reliability, responsiveness, assurance, and empathy, as related to service quality (network quality, compliant handling, and service convenience). Figure 2 illustrates a framework for modelling the highest contributions to overall service quality and customer satisfaction.
Assurance
Empathy
Network Quality
Compliant Handling & Convenience
Overall Customer Satisfaction
Figure 2. Model for Overall Service Quality and Customer Satisfaction (Source: Negi, 2009) defined as banks satisfying customer needs and wants through technology. This is a study based on other studies on customer perceptions of banking institutions and whether and how their needs are satisfied. Figure 3 illustrates the framework for this study.
Mylonakis [9] has conducted research about customer satisfaction. The satisfied customers emerge as a result of Customer Relationship Management (CRM). The main finding of this study reveals that the majority of customers are satisfied with their bank. In this study, customer satisfaction is
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International Journal of Applied Engineering Research ISSN 0973-4562 Volume 11, Number 4 (2016) pp2705-2710 © Research India Publications. http://www.ripublication.com Customer satisfaction
Demographic factors
Bank competition
Bankinnovat ion
Communication technology
Bank communication effectiveness
Bank employee attitudes
Bank customers require coverage
The interest of banks
Figure 3. Customer Satisfaction Perceptions of Banking Institutions (Source: Mylonakis, 2009) Proposed E-Grocery-KSA’s Model Customer satisfaction with E-Grocery-KSA will be classified into two ways. The first involves customer intentions to adopt electronic grocery stores in the city of Jeddah, Saudi Arabia. The second method involves following the findings of previous studies to satisfy E-Grocery-KSA’s customers in Jeddah to address problems these customers have faced with respect to traditional grocers. These problems are as follows: (1) Infrastructure factors (i.e., parking issues and queue problems). (2) Personal factors (i.e., families have small children, busy scheduling, and time problems). (3) Product factors (i.e., quality problems and price issues).
A study is conducted by Nurul Huda Binti Ali [10] about customer satisfaction of her online laundry website. The website integrates online order, purchasing and delivery service for customers. The proposed framework is shown in figure 4. The findings of this study show that efficiency, reliability, responsiveness, price knowledge, assurance/trust and empathy have significant influence on customer satisfaction of theonline laundry website’s quality.
Tangible is defined as refers to physical facilities, equipment and the appearance of personnel. Reliability is defined as the ability to perform the promised service dependably and accurately. Responsiveness is defined as the willingness to help customers and provide prompt service. Assurance is defined as the knowledge and politeness of employees and their ability to inspire trust and confidence. Empathy is defined as the caring and individualised attention that a firm provides its customers. Figure 5 illustrates the research design for the study on E-Grocery-KSA’s study.
Figure 4. The proposed model for online laundry website’s customer satisfaction
Customer satisfaction
Empathy
Assurance
Responsiveness
Reliabilit y
Tangibles
Figure 5. Research Design for E-Grocery-KSA Based on this research design, the following hypothesizes are formulated: H1: There is a positive relationship between tangible and customer satisfaction. H2: There is a positive relationship between reliability and customer satisfaction. H3: There is a positive relationship between responsiveness and customer satisfaction.
H4: There is a positive relationship between assurance and customer satisfaction. H5: There is a positive relationship between empathy and customer satisfaction.
Research Methodology
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International Journal of Applied Engineering Research ISSN 0973-4562 Volume 11, Number 4 (2016) pp2705-2710 © Research India Publications. http://www.ripublication.com 46.3% of them work between 8 to 9 hours per day. The majority of employees group in this survey earn a monthly income of more than 8000 SR that is 40.8% of participants. There are 53.5% of the participants of this survey reside in the northern Jeddah. The majority of participants who buy from the suppliers in this survey are 74.3% of participants. The majority of others who buy from the suppliers in this survey are mothers that are 7% of participants. The majority of participants who purchased chicken in this survey are 94.8%. In addition, 48.5% of the respondents preferred purchasing chicken which were stored in freezers. In terms of its brands, 41.8% of them opted for Radwah. On the other hand, 38.5% of the participants preferred chicken of 900 gm. Besides, a vast proportion of 94.8% of the participants purchased four pieces of chicken per week in this survey. 96.8% of the participants agreed that they do purchase vegetables for their daily food. Relatively, 96.3% of the participants agreed that they consume fruits as part of their food. Meat was also consumed by these participants and 78.3% chose to say so. 74% of the participants preferred buying fresh meat rather than frozen ones. With regard to the types of meat consumed, there are 65% of them consumed mutton. In addition, 55.1% of the participants in this survey preferred buying 5kg of meat every week. There are 86% of the participants of this survey chose egrocery as their preference by justifying that they do not have enough time to go to supermarkets. In terms of online transactions, 65.8% of them chose to say that online shopping is the best alternative. The descriptive statistics for each variable is shown in Table 1. The scale measurement use 7-point Likert scale for each variable: Tangible, reliability, responsiveness, assurance, empathy, customer satisfaction, and intention to adopt egrocery. Each variable in this study become with minimum scale 1 and maximum scale 7. Based on the Table 2, the higher mean score in this study is customer satisfaction which is 5.20 and the lower mean score in this study is responsiveness that is 3.81. The higher standard deviation in this study is tangible which is 1.42 and the lower standard deviation in this study is assurance which is 1.25.
To make this research successful, a survey questionnaire on egrocery has been designed for distribution to individuals in Jeddah City. The findings from this questionnaire should reveal the number of people in Jeddah who would use this type of business. This study thus seeks to obtain this information by adapting the SERVQUAL model to explore the factors predicting satisfaction with and loyalty to traditional grocery stores. The questionnaire was distributed online. The link to online questionnaire was sent to inhabitants of Jeddah City through e-mail and people who receive it been asked to send it to their friends and families. This technique of data collection is known as snowball sampling. The questions for this questionnaire are presented in both Arabic and English languages.
Data Analysis and Results The data collected were analysed using the software “Statistical Package for the Social Sciences” (SPSS), version 17.00. Descriptive statistics were used to describe respondents, while frontal statistics were used to analyse the relationships between dependent and independent variables. Based on the questionnaire, Pearson’s correlation analysis was used and also reliability analysis was used to analyse dependent and independent variables. The Multiple regression analysis using the enter method was employed to investigate dependent and independent variables with a significant level of 5%. The highest proportions of gender group in this survey are males 74.3% of total participants. Those aged from the range of 30-50 years old that amounted to 47.7% of participants. Social status of the most of the respondents in this survey is married that is 67.5% of participants. Number of family members of many of the sampling population ranged between 4-6 persons and in terms of percentage, it was 46.8% of total respondents. Number of children category in this survey was between 1-3 children that is 55.6% of the total number of participants involved. 42.8% of all the respondents of this survey were fathers. In terms of education level, a major portion of them were in undergraduate level which was 58% of the total amount. 40.3% of participants in this survey are of Bandah which is one of the best traditional grocery stores. The majority of feathers of the supermarket group in this survey are near to the respondents’ and 49% of the participants chose to say so. A proportion 33.8% of participants stated that they frequented the supermarkets for twice a month. The fresh grocery group in this survey from 200-500 SR that is 55% of participants said they spend weekly on fresh grocery. On the other hand, a vast majority of 59.8% prefer advertisement through SMS messages. The credit card group of this survey agreed upon the usage of credit cards and this was 52.8% of participants. About 29.3% of the participants stated that they use it for emergency purposes. Of all the credit cards available, Master Card was the choice of 29.8% of the participants. There are 70.3 % of the participants claimed that they were employees. According to them, 45.8% of them stated that they work for 5 days in a week and in terms of working hours,
Table 1. Descriptive Statistics for Each Variable Items Who Needs the egrocery Shopping In Jeddah City
Variables Frequency Those who do not have 344 time to go to the supermarket Those who have 204 younger children and cannot bring them to the supermarket Those who do not like 212 to wait in line Those who find it 171 difficult to find parking Those who dislike 243 travelling during rush hour Best Method for From the website is 263 Purchase from e- best purchasing
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Percent % 86%
51%
53% 42.80%
60.80%
65.80%
International Journal of Applied Engineering Research ISSN 0973-4562 Volume 11, Number 4 (2016) pp2705-2710 © Research India Publications. http://www.ripublication.com grocery
method SMS messages is best 34 purchasing method By phone call is best 96 purchasing method By fax is best 5 purchasing method
Correlation Analysis: Table 4 provides a summary of the results from correlation analysis. The result from the correlation analysis between satisfaction (the dependent variable) and reliability, responsiveness, assurance, empathy, tangibles and intention to engage in e-grocery shopping in Jeddah City (the independent variables) are provided. Result from the correlation analysis between satisfaction (DV) and reliability, responsiveness, assurance, empathy, tangibles and intention to make e-grocery shopping in Jeddah city (ID) are correlated. The satisfaction is correlated to reliability that is 0.576 at p < 0.01. The satisfaction is correlated to responsiveness that is 0.252 at p < 0.01. The satisfaction is correlated to assurance that is 0.607 at p < 0.01. The satisfaction is correlated to empathy that is 0.373 at p < 0.01. The satisfaction is correlated to tangible that is 0.750 at p < 0.01. The satisfaction is correlated to intention to adopt e-grocery that is 0.385 at p < 0.01.
8.50% 24% 1.30%
Table 2: Descriptive Analysis for Study Variables (IVs – DV) Variables
N Minimum Maximum Mean Standard Deviation 400 1 7 5.0400 1.42951 400 1 7 4.6275 1.28978 400 1 7 3.8175 1.36869 400 1 7 4.5038 1.25344 400 1 7 4.0525 1.32738 400 1 7 5.2050 1.37442
Tangible Reliability Responsiveness Assurance Empathy Customer satisfaction Intention to adopt 400 1 e-grocery
7
4.7874 1.25354
Table 4. Correlations between Variables Satisfacti Reliabil Responsiven Assuran Empat Tangibl Intenti on ity ess ce hy es on
Reliability Test: The six factors resulting from exploratory factor analyses were analysed individually, and each was treated as a single variable. Therefore, each variable was tested for reliability before being considered in the subsequent analysis. The reliability of measures was estimated using the internal consistency approach. Moreover, this study utilised Cronbach’s alpha. To test the internal consistency of the measurement of the survey instrument, reliability analysis was conducted on the extracted factors using the recommendations of Paterson [11]. For the purpose of this study, a minimum reliability (or Cronbach’s Alpha) value of.60 was set, which is in line with Nunnaly [12]. The minimum of.60 is consistent with other researchers such as Murphy and Davidshofer [13]. A Cronbach’s alpha value below.60 is unacceptable. Meanwhile,.70 is low, and .80 to.90 is moderate. A value greater than .90 is considered high. The coefficient of reliability for each variable is shown in Table 3.
Number of items (after deducting items dropped) Satisfaction 9 Reliability 5 Responsiveness 3 Assurance 4 Empathy 3 Tangibles 3 Intention to engage in 8 e-grocery shopping in Jeddah City
Items Cronbach’s dropped Alpha
2 1 -
1
.576 (**)
.252 (**)
.607 (**)
.373 (**)
.750 (**)
Reliability
.576 (**)
1
.487 (**)
.663 (**)
.538 (**)
.644 (**)
Responsiven ess
.252 (**)
.487 (**)
1
.539 (**)
.613 (**)
.323 (**)
Assurance
.607 (**)
.663 (**)
.539 (**)
1
.657 (**)
.637 (**)
Empathy
.373 (**)
.538 (**)
.613 (**)
.657 (**)
1
.469 (**)
Tangibles
.750 (**)
.644 (**)
.323 (**)
.637 (**)
.469 (**)
1
Intention
.385 (**)
.385 (**)
1
Regression Analysis: Multiple-regression analysis was used to test the hypothesised relationships between the independent variables (or predictors) and the dependent variables (or criteria) (Hair, Anderson, Tatham & Black, 2006). Table 5 provides a summary of the results from regression analysis.
Table 3. Reliability Coefficients for the Major Variables Variable
Satisfaction
Table 5. Regression Analysis between the Dependent Variable and Independent Variables Independent Variables Reliability Responsiveness Assurance Empathy Tangibles R2 F value Durbin-Watson
.934 .881 .772 .800 .808 .863 .853
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Standardize Beta Model I 0.116* -0.083 0.262** -0.079 0.572** 0.604 120.421 1.977
International Journal of Applied Engineering Research ISSN 0973-4562 Volume 11, Number 4 (2016) pp2705-2710 © Research India Publications. http://www.ripublication.com The model is significant with R2 = 0.604 and F Value = 120.421. Upon examining the independent variable that is most significant is Tangibles (β = 0.572** at p < 0.01) and less significant is Reliability (β = 0.116* at p < 0.01). Based on the Table 5 will show which hypothesizes are supported and which are not supported: H1: There is a positive relationship between tangible and customer satisfaction is supported. H2: There is a positive relationship between reliability and customer satisfaction is supported. H3: There is a positive relationship between responsiveness and customer satisfaction is not supported. H4: There is a positive relationship between assurance and customer satisfaction is supported. H5: There is a positive relationship between empathy and customer satisfaction is not supported.
References [1]
[2]
[3]
[4]
Based on the Table 5 results, the independent variables tangible, reliability and assurance are significant with dependent variable customer satisfaction and applied to the hypothesis as mentioned in the E-Grocery-KSA model. Tangible has the highest impact on customers’ satisfaction with Beta = 0.572 (p < 0.01). The second higher impact is the assurance with Beta = 0.262, at (p < 0.01), and reliability with Beta = 0.116, at (p < 0.01).
[5]
[6]
[7]
Conclusion This study comprises customer satisfaction with traditional grocery and the intention to use the e-grocery store in the city of Jeddah, Saudi Arabia. The study is conducted about egrocery business in Jeddah City. This survey-based study adopted the five service quality dimensions to test customer satisfaction with traditional grocery shopping in Jeddah City and the extent to which they would use e-grocery shopping if available. The findings of this survey proved that tangibles, reliability and assurance are significant factors for customer satisfaction. Meanwhile, responsiveness and empathy are not significant factors. Moreover, the result of this study stated that the majority of participants in the survey agreed or strongly agreed that they would use e-grocery in Jeddah City in various parts of the city.
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Acknowledgement [13]
The authors would like to acknowledge Universiti Sains Malaysia (USM) as this research has been supported from the Short Term Research Grant [Account Number: 304/PKOMP/6312103] and from the Research University Grant (RUI) [Account Number: 1001/PKOMP/811251] from the Universiti Sains Malaysia. Special Thanks to Mr. Mohammad Ali Bagheri for his help and contribution in preparing and publishing this paper.
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